EXHIBIT 99.1










                   ADVISED REVOLVING LINE OF CREDIT AGREEMENT

                                 BY AND BETWEEN

            AMSOUTH BANK, a bank organized under the laws of Alabama

                                      AND

              CARROLL FULMER & COMPANY, INC. a Florida corporation
       CAROLINA PACIFIC DISTRIBUTORS, INC., a North Carolina corporation
                CAPITOL WAREHOUSE, INC., a Kentucky corporation
                 SERVICE EXPRESS, INC., an Alabama corporation



                 

                          DATED AS OF DECEMBER 18, 1997


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ARTICLE I - DEFINITIONS...................................................1
         Section 1.1.  Capital Expenditures...............................1
         Section 1.2.  Capitalization.....................................2
         Section 1.3.  Current Assets.....................................2
         Section 1.4.  Current Liabilities................................2
         Section 1.5.  Debt...............................................2
         Section 1.6.  Event of Default...................................2
         Section 1.7.  Generally Accepted Accounting Principles...........2
         Section 1.8.  Interest Expense...................................3
         Section 1.9.  Liabilities........................................3
         Section 1.10. LIBOR Reserve Requirement..........................3
         Section 1.11. Loan Documents.....................................3
         Section 1.12. Net Cash Flow. ....................................3
         Section 1.13. Net Income Available for Debt Service..............3
         Section 1.14. Net Income Available for Interest Payments.........3
         Section 1.15. Net Worth..........................................4
         Section 1.16. Permitted Contests.................................4
         Section 1.17. Qualified Investments..............................4
         Section 1.18. Receivables........................................4
         Section 1.19. Reserve Adjusted LIBOR Rate........................5
         Section 1.20. Tangible Net Worth.................................5
         Section 1.21. Total Liabilities..................................5

ARTICLE II - AMOUNT AND TERMS OF LOAN.....................................6
         Section 2.1.  Amount.............................................6
         Section 2.2.  Note...............................................6
         Section 2.3.  Interest and Principal.............................6
         Section 2.4.  Increased Costs, Illegality, Etc...................6
         Section 2.5.  Funding Limitations................................7

ARTICLES III - SECURITY AND GUARANTY......................................8
         Section 3.1.  Security Interest..................................8
         Section 3.2.  Guaranty...........................................8
         Section 3.3.  Security Documents.................................8
         Section 3.4.  Filing and Recording...............................9

ARTICLE IV - BORROWER'S AND GUARANTOR'S REPRESENTATIONS AND
         WARRANTIES.......................................................9
         Section 4.1.  Organization and Standing of Carroll Fulmer........9
         Section 4.2.  Organization and Standing of Carolina Pacific......9
         Section 4.3.  Organization and Standing of Capitol Warehouse....10
         Section 4.4.  Organization and Standing of Service Express......10
         Section 4.5.  Organization and Standing of Guarantor............10
         Section 4.6.  Corporate Power and Authority.....................10

                                                   
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         Section 4.7.  Valid and Binding Obligations.....................10
         Section 4.8.  Consent or Filing.................................11
         Section 4.9.  Financial Condition of the Borrower...............11
         Section 4.10. Litigation. ......................................11
         Section 4.11. Disclosure and No Untrue Statements. .............11
         Section 4.12. Title to Collateral...............................12
         Section 4.13. Payment of Taxes. ................................12
         Section 4.14. Agreement or Contract Restrictions. ..............12
         Section 4.15. Patents, Trademarks, Etc. ........................12
         Section 4.16. Investment Company Act; Regulation................12
         Section 4.17. Labor Matters. ...................................13
         Section 4.18. ERISA Requirement. ...............................13
         Section 4.19. Compliance With Environmental Requirements. ......13
         Section 4.20. Use of Credit. ...................................14

ARTICLE V - CONDITIONS PRECEDENT.........................................14
         Section 5.1.  Documents and Instruments.........................14
         Section 5.2.  Correctness of Warranties.........................15
         Section 5.3.  Certificates of Resolution........................15
         Section 5.4.  Expenses of Lender................................15
         Section 5.5.  Supporting Documents. ............................15
         Section 5.6.  Opinion of the Borrower's Counsel. ...............16

ARTICLE VI - BORROWER'S AND GUARANTOR'S AFFIRMATIVE COVENANTS............16
         Section 6.1.  Corporate Existence and Qualification.............16
         Section 6.2.  Financial Statements..............................17
         Section 6.3.  Executive Officer's Certificates..................17
         Section 6.4.  Taxes and Claims..................................17
         Section 6.5.  Pay Indebtedness to Lender and Perform 
                         Other Covenants.................................18
         Section 6.6.  Litigation........................................18
         Section 6.7.  Right of Inspection; Discussions. ................18
         Section 6.8.  Notices.  ........................................18
         Section 6.9.  ERISA Benefit Plans. .............................19
         Section 6.10. Insurance.........................................19
         Section 6.11. Main Bank of Account..............................20
         Section 6.12. Net Worth Requirement.............................20
         Section 6.13. Leverage Ratio....................................20
         Section 6.14. Interest Coverage Ratio...........................20
         Section 6.15. Lockbox and Accounts Receivable...................20
         Section 6.16. Field Audits......................................23
         Section 6.17. Collateral Reporting..............................23
         Section 6.18. Observance of Laws. ..............................24
         Section 6.19. Subsidiaries......................................24
         Section 6.20. Capitalization Ratio..............................24


                                                   
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ARTICLE VII - BORROWER'S NEGATIVE COVENANTS..............................24
         Section 7.1.  Type of Business..................................24
         Section 7.2.  Change in Ownership or Management.................24
         Section 7.3.  Acquisitions and Mergers..........................24
         Section 7.4.  Capital Expenditures..............................25
         Section 7.5.  Guaranty..........................................25
         Section 7.6.  Investment and Loans..............................25
         Section 7.7.  Disposition or Encumbrance of Receivables.........25
         Section 7.8.  Sale-Leasebacks...................................25
         Section 7.9.  Leases............................................25
         Section 7.10. Liens.............................................26
         Section 7.11. Take or Pay Contracts.............................26
         Section 7.12. Other Special Covenants...........................27

ARTICLE VIII - EVENTS OF DEFAULT.........................................27
         Section 8.1.  Events............................................27
                  (a)  Payment of Obligations to Lender. ................27
                  (b)  Representation or Warranty. ......................27
                  (c)  Covenants. .......................................27
                  (d)  The Borrower's Liquidation; Dissolution;
                          Bankruptcy; Etc. ..............................27
                  (e)  Order of Dissolution. ............................28
                  (f)  Reports and Certificates. ........................28
                  (g)  Judgments. .......................................28
                  (h)  Liens Imposed by Law. ............................28
                  (i)  Corporate Existence. .............................28
         Section 8.2.  Rights and Remedies Cumulative....................29
         Section 8.3.  Rights and Remedies Not Waived....................29
         Section 8.4.  Waiver of Default.................................29

ARTICLE IX - MISCELLANEOUS...............................................30
         Section 9.1.  Course of Dealing; Amendments; Waiver. ...........30
         Section 9.2.  Lien; Setoff By Lender............................30
         Section 9.3.  Liability of Lender to Third Parties..............30
         Section 9.4.  Waivers...........................................30
         Section 9.5.  Assignment and Participation......................31
         Section 9.6.  Funds Not Assignable..............................31
         Section 9.7.  Indemnity.........................................31
         Section 9.8.  Termination by the Borrower.......................32
         Section 9.9.  Arbitration.  ....................................32
         Section 9.10. Notices...........................................32
         Section 9.11. Controlling Agreement.............................32
         Section 9.12. Titles............................................32
         Section 9.13. Venue and Jurisdiction. ..........................33
         Section 9.14. Governing Law. ...................................33

                                                   
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         Section 9.15. Legal or Governmental Limitations. ...............33
         Section 9.16. Counterparts. ....................................33
         Section 9.17. Waiver of Trial By Jury...........................33
         Section 9.18. Confidentiality...................................34
         Section 9.19. Total Liability of Each Co-Borrower...............34



                                                   
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                   ADVISED REVOLVING LINE OF CREDIT AGREEMENT


       THIS AGREEMENT dated as of the 18th day of December, 1997, by and between
AMSOUTH BANK, a bank organized under the laws of Alabama,  whose mailing address
is Post Office Box 588001,  Orlando,  Florida 32858 (the "Lender"),  and CARROLL
FULMER & COMPANY, INC., a Florida corporation,  whose address is P. O. Box 5000,
Groveland,   Florida   34736-5000   ("Carroll   Fulmer")  and  CAROLINA  PACIFIC
DISTRIBUTORS,  INC., a North Carolina corporation, whose address is 5625 Surrett
Drive Extension, Archdale, North Carolina 27263 ("Carolina Pacific") and CAPITOL
WAREHOUSE,  INC., a Kentucky  corporation,  whose address is 403 W. Main Street,
Frankfurt,  Kentucky 40601 ("Capitol  Warehouse") and SERVICE EXPRESS,  INC., an
Alabama corporation,  whose address is P.O. Box 1009, Tuscaloosa,  Alabama 35403
("Service  Express")  (Carroll Fulmer,  Carolina Pacific,  Capitol Warehouse and
Service  Express are  together  hereinafter  referred to as the  "Borrower"  and
individually  referred to as a "Co-Borrower";  references applicable to Borrower
shall also be  applicable  to each  Co-Borrower),  and TRANSIT  GROUP,  INC.,  a
Florida corporation, whose address is Overlook III, 2859 Paces Ferry Road, Suite
1740, Atlanta, Georgia 30339 (the "Guarantor").


                              W I T N E S S E T H:

         WHEREAS,  the Borrower has requested the Lender to lend to Borrower for
the purpose of supporting working capital needs and acquisitions; and

         WHEREAS,  the  Guarantor  will  derive a  benefit  from  such  loan and
therefore  has agreed to guarantee the debt of Borrower to Lender and enter into
this Agreement; and

         WHEREAS,  subject  to the  continued  acceptability  of the  collateral
referred to herein and subject to the  compliance  by the Borrower and Guarantor
with all of the terms and conditions  hereof, the Lender is willing to make such
loan on the terms and conditions and on the security hereinafter set forth.

         NOW,  THEREFORE,  in consideration of the mutual promises,  conditions,
representations  and  warranties  hereinafter  set forth and for other  good and
valuable consideration, the parties hereto have mutually agreed as follows:


                             ARTICLE I - DEFINITIONS

         Section 1.1.      Capital Expenditures.

         Capital Expenditures means any expenditures for fixed assets or that is
properly  chargeable to capital  account in accordance  with generally  accepted
accounting principles.



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         Section 1.2.      Capitalization.

         Capitalization means Net Worth plus Debt.

         Section 1.3.      Current Assets.

         Current Assets means assets that, in accordance with generally accepted
accounting  principles,   are  current  assets;  provided,   however,  that  (1)
inventories  shall be taken into account on the basis of cost or current  market
value,  whichever is lower, or, to the extent that such inventories are required
for delivery under then-existing  contracts,  the applicable contract price, (2)
current  assets shall not include any intangible  assets or any securities  that
are not readily  marketable,  (3) securities included as current assets shall be
taken into account at the current market price  thereof,  and (4) current assets
shall not  include any  amounts  due from or owed by any  shareholder,  partner,
member (as applicable) or affiliate of the Guarantor, the Co-Borrowers or any of
its Subsidiaries.

         Section 1.4.      Current Liabilities.

         Current  Liabilities  means, as of the date of determination,  all Debt
maturing  on demand or within one year from,  and that is not  renewable  at the
option of the obligor to a date later than one year after,  the date as of which
such  determination  is made and all other  items  (including  taxes  accrued as
estimated) that, in accordance with generally  accepted  accounting  principles,
would be included as current liabilities.

         Section 1.5.      Debt.

         Debt  of  any  person  means  (1)  all  indebtedness,  whether  or  not
represented by bonds, debentures,  notes or other securities,  for the repayment
of borrowed money, (2) all deferred indebtedness for the payment of the purchase
price of property or assets purchased,  except trade accounts  payable,  (3) all
capitalized lease obligations,  (4) all indebtedness  secured by any Lien on any
property of such person,  whether or not  indebtedness  secured thereby has been
assumed,  (5) all obligations  with respect to any conditional  sale contract or
title retention  agreement,  (6) all indebtedness and obligations  arising under
acceptance  facilities or in connection  with surety or similar  bonds,  and the
outstanding  amount of all  letters  of credit  issued  for the  account of such
person, and (7) all obligations with respect to interest rate swap agreements.

         Section 1.6.      Event of Default.

         "Event of Default"  means  any of the events  specified in  Section 8.1
hereof.

         Section 1.7.      Generally Accepted Accounting Principles.

         "Generally  Accepted  Accounting  Principles" means those principles of
accounting set forth in Opinions of the Financial  Accounting Standards Board of
the American Institute of Certified

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Public Accountants or which have other substantial authoritative support and are
applicable in the  circumstances as of the date of any report required herein or
as of the date of an application of such principles as required herein.

         Section 1.8.      Interest Expense.

         Interest  Expense means  interest  payable on Debt during the period in
question.

         Section 1.9.      Liabilities.

         Liabilities means all Debt and all other items (including taxes accrued
as estimated) that, in accordance with generally accepted accounting principles,
would be included in determining  total  liabilities as shown on the liabilities
side of a balance sheet.

         Section 1.10.     LIBOR Reserve Requirement.

         "LIBOR  Reserve  Requirement"  means,  for any  day,  the rate at which
reserves  (including,   without  limitation,  any  marginal,   supplemental,  or
emergency reserves) are required to be maintained by member banks of the Federal
Reserve  System on such day against  Eurocurrency  liabilities,  expressed  as a
decimal.

         Section 1.11.     Loan Documents.

         "Loan  Documents"  means and includes  the Note,  this  Agreement,  the
corporate  resolution,  and any and all other  documents  executed in connection
with this loan accommodation.

         Section 1.12.     Net Cash Flow.

         Net Cash Flow for any period means net income (or the net  deficit,  if
expenses and charges exceed  revenues and other proper income  credits) for such
period,  plus  amounts  that have been  deducted  for (1)  depreciation  and (2)
amortization in determining net income for such period.

         Section 1.13.     Net Income Available for Debt Service.

         Net Income  Available  for Debt Service for any period means net income
(or the net deficit,  if expenses and charges  exceed  revenues and other proper
income  credits) for such period,  plus amounts that have been  deducted for (1)
depreciation,  (2)  amortization  and (3) Interest  Expense in  determining  net
income for such period.

         Section 1.14.     Net Income Available for Interest Payments.

         Net Income Available for Interest Payments means net income (or the net
deficit,  if expenses  and  charges  exceed  revenues  and other  proper  income
credits) for such period plus amounts that

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have been deducted for (1) Interest  Expense,  (2) income and profit taxes,  and
(3) amortization of debt discount in determining net income for such period.

         Section 1.15.     Net Worth.

         Net Worth means the sum of the  amounts set forth on the balance  sheet
as  shareholders'  equity  (including the par or stated value of all outstanding
capital stock,  retained earnings,  additional paid-in capital,  capital surplus
and earned surplus).

         Section 1.16.     Permitted Contests.

         Permitted  Contests  means  litigation  or  administrative  proceedings
pursued by Borrower in good faith regarding taxes or construction liens.

         Section 1.17.     Qualified Investments.

         Qualified Investments means:

                  (1) direct obligations of, or obligations the payment of which
is guaranteed by the United States of America ("Federal Securities"),

                  (2) an  interest in any trust or fund that  invests  solely in
Federal Securities,

                  (3)  a   certificate   of   deposit   issued   by,   or  other
interest-bearing  deposit with, any bank organized  under the laws of the United
States of America or any state thereof, provided that (A) such bank has capital,
surplus and undivided profits of not less that $50,000,000,  (B) such deposit is
insured by the Federal  Deposit  Insurance  Corporation,  or (C) such deposit is
collaterally secured by such bank by pledging Federal Securities having a market
value  (exclusive  of accrued  interest)  not less than the face  amount of such
deposit  (less  the  amount  of such  deposit  insured  by the  Federal  Deposit
Insurance Corporation), and

                  (4) a purchase  agreement with respect to Federal  Securities,
provided that the Federal  Securities  subject to such repurchase  agreement are
held by or under the control of the  Co-borrowers  free and clear of third-party
Liens.

         Section 1.18.     Receivables.

         "Receivables"  means and  includes  all  present  and future  accounts,
commissions,   contract  rights,  lease  payment,  chattel  paper,  instruments,
documents,  tax  refunds  payable  to  Borrower,   license  fees  and  proceeds,
royalties,   insurance  proceeds  and  general  intangibles  and  all  forms  of
obligations  owing,   together  with  all  documents  or  instruments  of  title
representing  the same and  rights in any  merchandise  or goods  which the same
represent, together with all right, title, security and guarantees, with respect
to each of the Receivables, including any right of stoppage in transit,

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whether the same are now or hereafter  owned.  "Receivables"  also  specifically
include all rights of Borrower  under any patent  license  agreement,  technical
assistance contract,  product supply contract, or similar agreement and includes
all trade names,  trademarks,  license  agreements and all records pertaining to
the accounts,  debtors,  and collateral and all computer software  pertaining to
the Receivables of Borrower.

         Section 1.19.     Reserve Adjusted LIBOR Rate.

         "Reserve  Adjusted  LIBOR Rate" means,  for any  "Interest  Period" (as
defined in the Note),  an interest  rate per annum  obtained by dividing (i) the
rate quoted on the Telerate  page 3750 as of 11:00 a.m.  London time, on the day
that is two London  banking days prior to the first day of the Interest  Period,
in an amount  substantially  equal to the "LIBOR-Based  Rate" (as defined in the
Note) and with a term  substantially  equal to such Interest Period,  by (ii) an
amount equal to 1 minus the LIBOR Reserve  Requirement for such Interest Period.
In the event the rate quoted by Telerate is  discontinued  or the rate otherwise
cannot be identified,  the Lender shall  determine the  LIBOR-Based  Rate on the
basis of quotes by major  banks in the London  interbank  Eurodollar  market for
dollar deposits in an amount substantially equal to and for a term substantially
equal to the Interest Period selected.

         Section 1.20.     Tangible Net Worth.

         Tangible  Net  Worth  means  the sum of the  amounts  set  forth on the
balance sheet as shareholders'  equity (including the par or stated value of all
outstanding  capital  stock,  retained  earnings,  additional  paid-in  capital,
capital  surplus  and  earned  surplus),  less the sum of (1) any  amount of any
write-up of assets, (2) goodwill, (3) patents, trademarks, copyrights, leasehold
improvements  not recoverable at the expiration of a lease, and deferred charges
(including  unamortized  debt,  discount  and  expense,  organization  expenses,
experimental and developmental  expenses,  but excluding prepaid expenses),  (4)
any amounts at which shares of capital  stock of such person appear on the asset
side  of the  balance  sheet  and  (A)  any  amounts  due  from  or  owed by any
shareholder or affiliate.

         Section 1.21.     Total Liabilities.

         Total  Liabilities  means all Debt and all other items (including taxes
accrued as estimated)  that, in accordance  with generally  accepted  accounting
principles,  would be included in determining  total liabilities as shown on the
liabilities side of a balance sheet.



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                      ARTICLE II - AMOUNT AND TERMS OF LOAN

         Section 2.1.      Amount.

         The Lender agrees,  on the terms and conditions of this  Agreement,  to
lend to Borrower in an aggregate  principal  amount not to exceed TWENTY MILLION
DOLLARS  ($20,000,000.00)  (hereinafter  sometimes  referred to as the "Loan" or
"Line of Credit").

         Section 2.2.      Note.

         The  obligation  to repay the loan is evidenced  by a revolving  credit
note in the principal sum of TWENTY MILLION DOLLARS ($20,000,000.00) (the "Note"
or "Revolving  Credit Note").  Under the Loan, the Borrower may,  subject to the
terms,  conditions herein set forth and subject to the approval of an officer of
Lender,  borrow from Lender,  at such time and in such amounts not exceeding the
total amount of TWENTY MILLION DOLLARS ($20,000,000.00).

         Section 2.3.      Interest and Principal.

         The interest on and  principal of the Note shall be paid in  accordance
with the terms and conditions more particularly set forth in the Note.

         Section 2.4.      Increased Costs, Illegality, Etc.

                  (a) If either (i) the introduction of or any change in any law
or  regulation  or in  the  interpretation  or  administration  of  any  law  or
regulation by any court or administrative or governmental authority charged with
the  interpretation or  administration  thereof from the date hereof or (ii) the
compliance with any guideline  enacted after the date hereof or request from any
such governmental  authority,  including,  without limitation,  any central bank
(whether  or not  having  the  force of law),  which is not  caused by an act or
omission  of Lender,  including  without  limitation,  its  failure to  maintain
adequate capital,  (x) subjects Lender or any corporation  controlling Lender to
any tax of any kind whatsoever  with respect to this  Agreement,  or changes the
basis of  taxation  of  payments  to Lender  of  principal,  commissions,  fees,
interest,  or any other  amount  payable  hereunder  (except for (A) taxes on or
measured  by the  overall  net  income of Lender or  branch,  office,  or agency
through which Lender is acting for purposes of this  Agreement or (B) changes in
the rate of such taxes); (y) imposes, modifies, or holds applicable any reserve,
special deposit, compulsory loan, or similar requirement against assets held by,
or deposits or other liabilities in or for the account of, advances or loans by,
or other credit or commitment  therefor extended by, or any other acquisition of
funds  by,  any  office  of  Lender  which  are not  otherwise  included  in any
determination  of the  Reserve  Adjusted  LIBOR Rate or other  interest  payable
hereunder;  or (z) imposes on Lender or the corporation  controlling  Lender any
other  condition,  and as a result  there  shall be any  increase in the cost to
Lender of agreeing to make or making,  funding,  or  maintaining  advances by an
amount  deemed by Lender to be material,  then the  Borrower  shall from time to
time,  upon  demand  by  Lender,  pay  directly  to  Lender  additional  amounts
sufficient to compensate Lender for such increased

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cost. A certificate  as to the amount of such increased  cost,  submitted to the
Borrower by Lender,  shall be conclusive  and binding for all  purposes,  absent
manifest error.

                  (b) If  Lender  determines  that  compliance  with  any law or
regulation  or with any  guideline  or request  from any  central  bank or other
governmental  authority subsequent to the date hereof (whether or not having the
force of law)  concerning  capital  adequacy or otherwise  has or would have the
effect  of  reducing  the  rate  of  return  on the  capital  of  Lender  or the
corporation  controlling  Lender as a consequence  of, or with reference to, the
facilities hereunder, by an amount deemed by Lender to be material, the Borrower
shall from time to time, upon demand by Lender, pay to Lender additional amounts
sufficient to compensate Lender or such other corporation for such reduction.  A
certificate  as to such amounts,  submitted to the Borrower by Lender,  shall be
conclusive and binding for all purposes, absent manifest error.

                  (c) In the  event  the  LIBOR  Reserve  Requirement  increases
subsequent to the date hereof, the interest rate applicable to the Note shall be
the Reserve Adjusted LIBOR Rate.

         Section 2.5.      Funding Limitations.

         Until May 1, 1999, the maximum principal amount that may be outstanding
from time to time  under the Line of Credit  shall not  exceed the lesser of the
following:  (a) TWENTY  MILLION  DOLLARS  ($20,000,000.00);  or (b)  eighty-five
percent (85%) of the Co-Borrower's eligible Receivables.  After May 1, 1999, the
maximum  principal  amount that may be  outstanding  from time to time under the
Line of Credit shall not exceed the lesser of the following:  (a) TWENTY MILLION
DOLLARS  ($20,000,000.00);  or (b)  fifty  percent  (50%)  of the  Co-Borrower's
eligible accounts receivable. Eligible accounts receivable shall not include any
ineligible accounts receivable including those receivables  described below. For
purposes of determining the funding  limitations,  each Co-Borrower's  borrowing
base of eligible accounts receivable shall be determined  separately and funding
eligibility  will be  determined  separately  and accounts  receivable  from one
Co-Borrower  may  not be  used to  calculate  the  borrowing  base  for  another
Co-Borrower.  The monies  disbursed  under the Line of Credit will be  disbursed
based on such  Co-Borrower's  borrowing base and disbursements may be made based
on verbal or written request to Lender in Lender's sole discretion.

         The Lender shall have the right, in the good faith exercise of its sole
discretion,  to deem any specific accounts receivable ineligible for the purpose
of calculating the maximum principal amount that may be outstanding from time to
time  under  the Note,  including  but not  limited  to the  following  types of
Receivables:  (1) invoices aged ninety (90) days or more past invoice date;  (2)
accounts  that have over  thirty-five  percent  (35%) of the total  balance aged
ninety  (90)  days or more  past  invoice  date;  (3)  Receivables  due from any
government  agency  to the  extent  that  such  Receivables  exceed  15% of each
Co-Borrower's eligible accounts receivable;  and (4) credit balances aged ninety
(90) days or more past invoice date;  (5) accounts owed by foreign  corporations
which are not fully  insured  under the current  credit  insurance  policy;  (6)
accounts  owed by or due from  affiliates,  related  parties,  stockholders,  or
employees;  (7) accounts that could be subject to the right of offset, including
but not limited to contra  accounts;  (8) invoices issued for services  rendered
prior to the actual rendering of the services (i.e.,  pre-billed invoices);  (9)
post dated invoices; (10) any Receivables due

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from any entity to the extent that such Receivables exceed 15% of the Borrowers'
eligible  Receivables;  and (11) any Receivables  resulting from any transaction
not in the ordinary course of business.  Lender shall have no obligation to fund
if an Event of Default exists.


                      ARTICLES III - SECURITY AND GUARANTY

         As  security  for the full and  timely  payment  of the  principal  and
interest under the Note and for any and all other  indebtedness  or liability of
the Borrower to the Lender,  whether now  existing or hereafter  arising (all of
which indebtedness is hereby referred to as "Indebtedness"), the Borrower grants
and/or agrees to the following:

         Section 3.1.      Security Interest.

         The Borrower  hereby grants the Lender and shall cause to be granted to
the Lender a first  prior and  exclusive  lien and  security  interest  in and a
continuing  first  lien  upon the  following  property  (all of which is  herein
referred to collectively as the "Collateral"):

         (a)  All "Receivables", as defined in Section 1.18 hereof, of Borrower;
and

         (b)  All  proceeds,  products  and  accessions  of  and  to  all of the
foregoing.

         Section 3.2.      Guaranty.

         The  Borrower  shall cause to be duly  executed  and  delivered  to the
Lender the unlimited guaranty of the Guarantor, whereby the Guarantor guarantees
the  Borrower's  obligations  under the Note,  this  Agreement  and the Security
Documents  as  hereinafter  defined.  The  Guarantor,  by its  execution of this
Agreement, agrees that any and all loans, indebtedness or other liability of the
Borrower to the Guarantor shall at all times be subordinate to the  indebtedness
of the Borrower to the Lender.

         Section 3.3.      Security Documents.

         The Borrower, in order to describe the terms and conditions under which
the  Collateral  will be held by the  Lender,  shall  execute and deliver to the
Lender, in form and substance  satisfactory to the Lender,  any and all security
agreements,  financing  statements,  and any  other  documents  relating  to any
security as the Lender shall require from time to time (all herein together with
the  Note  and  this  Agreement   referred  to  collectively  as  the  "Security
Documents").  Concurrent  with the  execution of the Note,  the  Borrower  shall
deliver to the Lender executed Security  Documents  covering the items described
in Sections 3.1 and 3.2 in form and substance satisfactory to the Lender.


                                        8

<PAGE>



         Section 3.4.      Filing and Recording.

         The Borrower shall, at its cost and expense,  cause all instruments and
documents  given as security  pursuant  to this  Agreement  to be duly  recorded
and/or filed in all places  necessary,  in the opinion of the Lender, to perfect
and protect the security interest of the Lender in the property covered thereby.
The Borrower  hereby  authorizes  the Lender to file any financing  statement in
respect of any security interest created pursuant to this Agreement which may at
any time be required or which, in the opinion of the Lender,  may at any time be
desirable,  although the same may have been executed only by the Lender,  or, at
the option of the  Lender,  to sign such  financing  statement  on behalf of the
Borrower and file the same, and the Borrower hereby  irrevocably  designates the
Lender,   its   agents,    representatives   and   designees   as   agents   and
attorneys-in-fact  for the  Borrower  for this  purpose.  In the event  that any
recording or refiling  thereof (or the filing of any statements of  continuation
or assignment  of any  financing  statement) is required to protect and preserve
security interest,  the Borrower shall, at its cost and expense,  cause the same
to be re-recorded  and/or refiled at the time and in the manner requested by the
Lender.


           ARTICLE IV - BORROWER'S AND GUARANTOR'S REPRESENTATIONS AND
                                   WARRANTIES

         To induce the Lender to enter into this  Agreement,  the  Borrower  and
Guarantor  make the  following  representations  and  warranties  which shall be
deemed to be  continuous  representations  and  warranties so long as any credit
hereunder  remains  available or any  indebtedness of the Borrower to the Lender
remains unpaid:

         Section 4.1.      Organization and Standing of Carroll Fulmer.

         Carroll  Fulmer is a corporation  duly organized and existing under the
laws of the State of Florida and is duly  qualified  to do business in the State
of Florida and in each  jurisdiction  where the failure to be so qualified would
have a material  adverse  effect on  Borrower.  To the best of Carroll  Fulmer's
knowledge and belief, it is in material  compliance with all applicable laws and
regulations governing the conduct of its business and governing  consummation of
the  transactions and its principal place of business is located in the State of
Florida.

         Section 4.2.      Organization and Standing of Carolina Pacific.

         Carolina Pacific is a corporation duly organized and existing under the
laws of the State of North  Carolina and is duly qualified to do business in the
State of North  Carolina  and in each  jurisdiction  where the  failure to be so
qualified  would  have a material  adverse  effect on  Borrower.  To the best of
Carolina Pacific's  knowledge and belief, it is in material  compliance with all
applicable  laws and  regulations  governing  the  conduct of its  business  and
governing  consummation of the  transactions and its principal place of business
is located in the State of North Carolina.


                                        9

<PAGE>



         Section 4.3.      Organization and Standing of Capitol Warehouse.

         Capitol  Warehouse is a corporation  duly  organized and existing under
the laws of the State of Kentucky  and is duly  qualified  to do business in the
State of Kentucky and in each jurisdiction  where the failure to be so qualified
would  have a  material  adverse  effect  on  Borrower.  To the best of  Capitol
Warehouse's  knowledge  and  belief,  it  is in  material  compliance  with  all
applicable  laws and  regulations  governing  the  conduct of its  business  and
governing  consummation of the  transactions and its principal place of business
is located in the State of Kentucky.

         Section 4.4.      Organization and Standing of Service Express.

         Service Express is a corporation  duly organized and existing under the
laws of the State of Alabama and is duly  qualified  to do business in the State
of Alabama and in each  jurisdiction  where the failure to be so qualified would
have a material  adverse  effect on  Borrower.  To the best of Service  Express'
knowledge and belief, it is in material  compliance with all applicable laws and
regulations governing the conduct of its business and governing  consummation of
the  transactions and its principal place of business is located in the State of
Alabama.

         Section 4.5.      Organization and Standing of Guarantor.

         The Guarantor is a corporation  duly  organized and existing  under the
laws of the  State of  Florida  and is duly  qualified  to do  business  in each
jurisdiction in which the conduct of its business  requires such  qualification,
including  the State of Florida.  To the best of the  Guarantor's  knowledge and
belief,  it is in compliance with all applicable laws and regulations  governing
the conduct of its  business  and  governing  consummation  of the  transactions
contemplated hereby.

         Section 4.6.      Corporate Power and Authority.

         The  execution,  delivery and  performance  of this  Agreement  and any
Security Documents by the Borrower and Guarantor are within its corporate powers
and have been duly authorized by all necessary corporate and shareholder action,
are not in  contravention  of law or the terms of their  respective  Articles of
Incorporation or By-Laws or any amendment thereto,  or any indenture,  agreement
or undertaking to which they are a party or by which they are bound, except such
obligations which will be fully satisfied at the initial funding hereunder.

         Section 4.7.      Valid and Binding Obligations.

         This  Agreement,  the  Note,  the  Security  Documents  and  any  other
documents  required  hereunder,  when  executed  and  delivered  by Borrower and
Guarantor will constitute the legal, valid and binding respective obligations of
the Borrower and Guarantor, subject to applicable bankruptcy and insolvency laws
and laws affecting creditors' rights and the enforcement thereof generally.


                                       10

<PAGE>



         Section 4.8.      Consent or Filing.

         No consent, approval or authorization of, or registration,  declaration
or filing with any court, any governmental  body or authority or other person or
entity  is  required  in  connection  with  the  valid  execution,  delivery  or
performance of this  Agreement or any document  required by this Agreement or in
connection with any of the transactions  contemplated thereby, except the filing
of the financing statements contemplated hereunder.

         Section 4.9.      Financial Condition of the Borrower.

         (a) The financial  statements of the Borrower, a copy of which has been
furnished to the Lender, are materially  correct,  complete,  and fairly present
the  financial  condition  of the  Borrower  as at  the  date  of the  financial
statements  and fairly present the results of the operations of the Borrower for
the period covered thereby.

         (b) The  Borrower  has no material  direct or  contingent  liabilities,
liabilities  for  taxes,  long-term  leases,  or unusual  forward  or  long-term
commitments as of the date of the Agreement which are not disclosed by, provided
for, or reserved  against in the  financial  statements  or referred to in notes
thereto, and at such date there are no material unrealized or anticipated losses
from any  unfavorable  commitments  of the Borrower.  The  financial  statements
furnished to the Lender have been prepared in accordance with Generally Accepted
Accounting  Principles  applied on a consistent basis maintained  throughout the
period  involved.  There has been no material  adverse  change in the  business,
properties or condition,  financial or otherwise, of the Borrower since the date
of such financial statements.

         Section 4.10.     Litigation.

         There  is  no  suit  or  proceeding  at  law  or in  equity  (including
proceedings, by or before any court, arbitrator,  governmental or administrative
commission,  board or bureau, or other administrative agency) pending, or to the
knowledge of the Borrower or  Guarantor  threatened,  by or against or involving
the Borrower or Guarantor or against any of its properties,  or existence which,
if adversely  determined,  would have a material adverse effect on the property,
assets,  or  business  or on  the  condition,  financial  or  otherwise,  of the
Borrower.

         Section 4.11.     Disclosure and No Untrue Statements.

         No  representation  or  warranty  made  by the  Borrower  in  the  Loan
Documents  or which will be made by the Borrower  from time to time  pursuant to
Officer's   Certificates   (a)   contains   or   will   contain   any   material
misrepresentation  or material  untrue  statement of fact;  or (b) omits or will
omit to state any material  fact  necessary to make the  statements  therein not
misleading,  unless  otherwise  disclosed in writing to the Lender.  There is no
fact known to the  Borrower or any of its  executive  financial  officers  which
materially and adversely affects the business, assets, properties, or condition,
financial or otherwise, of the Borrower.

                                       11

<PAGE>



         Section 4.12.     Title to Collateral.

         The Borrower has good and marketable title to, and is the holder of all
of the interests in, all of the Collateral given as security to the Lender, free
and clear of all pledges,  liens, security interests or other encumbrances.  The
Borrower and Guarantor will warrant and defend the Collateral against the claims
and demands of all persons.

         Section 4.13.     Payment of Taxes.

         The Borrower has filed or caused to be filed all  federal,  state,  and
local tax returns which are required to be filed by it and has paid or caused to
be paid all taxes as shown on said returns or on any assessment  received by it,
to the extent that such taxes have become due, except as otherwise  permitted by
the provisions  hereof, and no controversy in respect of additional income taxes
which could have a material  adverse  effect on the Borrower is pending,  or, to
the knowledge of the Borrower, threatened, unless adequate reserve has been made
therefor. The Borrower has set up reserves which are believed by its officers to
be adequate  for the payment of all taxes for which a notice of  assessment  has
been received and for the payment of such taxes for the years that have not been
audited by the respective tax authorities.

         Section 4.14.     Agreement or Contract Restrictions.

         The  Borrower  is not a party to,  nor is it bound by,  any  agreement,
contract,  or  instrument  or  subject  to any  charter  or other  corporate  or
partnership   restriction  which  materially  adversely  affects  the  business,
properties, assets, operations, or financial condition of the Borrower except as
disclosed in the financial statements and notes thereto described in Section 6.2
hereof. The Borrower is not in material default in the performance,  observance,
or fulfillment of any  obligations,  covenants,  or conditions  contained in any
agreement  or  instrument  to which it is a party,  which  would have a material
adverse affect on Borrower performing hereunder.

         Section 4.15.     Patents, Trademarks, Etc.

         The Borrower  owns,  possesses,  or has the right to use all  necessary
patents,  patent rights,  licenses,  trademarks,  trademark rights, trade names,
trade name rights,  and  copyrights  to conduct its  business as now  conducted,
without  known  conflict  with any patent,  patent  right,  license,  trademark,
trademark right,  trade name, trade name right, or copyright of any other person
or entity.

         Section 4.16.     Investment Company Act; Regulation.

          (a)  The  Borrower  is not an  "investment  company,"  an  "affiliated
person" of any investment  company," or a company "controlled" by an "investment
company,"  and the  Borrower is not an  "investment  advisor" or an  "affiliated
person" of an  "investment  advisor"  (as each of the quoted terms is defined or
used in the Investment Company Act of 1940, as amended).

         (b) The Borrower is not subject to regulation  under any state or local
public utilities code or

                                       12

<PAGE>



federal,  state,  or local  statute or  regulation  limiting  the ability of the
Borrower to incur indebtedness for money borrowed.

         Section 4.17.     Labor Matters.

         There are no strikes or other labor  disputes  against the  Borrower or
Guarantor pending or, to the Borrower's or Guarantor's knowledge, threatened. To
the knowledge of Borrower,  hours worked by and payment made to employees of the
Borrower have not been in violation of the Fair Labor Standards Act or any other
applicable  law dealing with such  matters.  All material  payments due from the
Borrower on account of employee  health and welfare  insurance have been paid or
accrued as a liability on its books.

         Section 4.18.     ERISA Requirement.

         Except as previously  disclosed to Lender in writing, the Borrower does
not have in force any written or oral bonus plan,  stock option  plan,  employee
welfare,  pension  or  profit  sharing  plan,  or  any  other  employee  benefit
arrangement or understanding.  In addition,  the Borrower and any predecessor of
the  Borrower  is not  now or was not  formerly  during  the  five  year  period
immediately  preceding  the  effective  date of this  Agreement a  participating
employer in any multi employer or "multiple  employer"  plans within the meaning
of Sections 4001 (1)(a)(3),  4063, and 4064 of ERISA. Each employee benefit plan
subject to the requirements of ERISA complies in all material  respects with all
of the  requirements  of ERISA  and  those  plans  which  are  subject  to being
"qualified"  under Sections 401 (a) and 501 (a) of the Internal  Revenue Code of
1986, as amended from time to time,  have since their adoption been  "qualified"
and have  received  favorable  determination  letters from the Internal  Revenue
Service so holding.  There is no matter known to Borrower which would  adversely
affect the qualified tax exempt status of any such trust or plan,  and except as
previously disclosed to the Lender, there are no deficiencies or liabilities for
any such plan or trust.  No employee  benefit plan sponsored by the Borrower has
engaged in a nonexempt "prohibited transaction" as defined in ERISA.

         Section 4.19.     Compliance With Environmental Requirements.

         The Borrower  warrants and represents to the Lender that to the best of
Borrower's  knowledge,  the real  property  owned by  Borrower is now and at all
times hereafter will continue to be in full  compliance with all federal,  state
and local  environmental laws and regulations as they now exist or are hereafter
enacted  and/or  amended,  including,  but not  limited  to,  the  Comprehensive
Environmental  Response,  Compensation  and Liability Act of 1980, as amended by
the  Superfund   Amendments  and  Reauthorization  Act  of  1986,  the  Resource
Conservation  and Recovery Act of 1976, as amended by the Used Oil Recycling Act
of 1980, and the Hazardous and Solid Waste  Amendments of 1984, as amended.  The
Borrower shall  indemnify and hold the Lender  harmless from and against any and
all  damages,  penalties,  fines,  claims,  liens,  suits,  liabilities,   costs
(including  cleanup  costs),   judgments  and  expenses  (including  attorneys',
consultants' or experts' fees and expenses) of every kind and nature suffered by
or asserted against the Lender as a direct or indirect result of any warranty or
representation made by the Borrower in this paragraph being false or untrue

                                       13

<PAGE>



in any  material  respect  or any  requirement  under  any  law,  regulation  or
ordinance,  whether local,  state or federal,  which requires the elimination or
removal of any hazardous materials,  substances, wastes or other environmentally
regulated substances.  The Borrower's obligations hereunder shall not be limited
to any extent by the term of the indebtedness secured hereby, and, as to any act
or  occurrence  prior to payment in full and  satisfaction  of the  indebtedness
which gives rise to liability hereunder,  shall continue,  survive and remain in
full force and effect  notwithstanding  payment in full and  satisfaction of the
indebtedness.

         Section 4.20.     Use of Credit.

         The Loan  shall  be used  exclusively  for the  purpose  of  supporting
working  capital  needs and  acquisitions.  The  Borrower  is not engaged in the
business of extending  credit for the purpose of purchasing or carrying  "margin
stock" (within the meaning of Regulation U,  Regulation X or Regulation G of the
Board of Governors of the Federal Reserve  System),  and no part of the proceeds
of any advance  hereunder will be used to purchase or carry any "margin  stock,"
to extend credit to others for the purpose of purchasing or carrying any "margin
stock," or for any other  purpose  which might  constitute  this  transaction  a
"purpose credit" within the meaning of Regulation U, Regulation X, or Regulation
G.  Neither the  Borrower  nor any person  acting on behalf of the  Borrower has
taken or will take any  action  which  might  cause  the Note or any other  Loan
Documents,  including this Agreement,  to violate Regulation U, Regulation X, or
Regulation  G or any other  regulation  of the Board of Governors of the Federal
Reserve system or violate  Section 8 of the  Securities  Exchange Act of 1934 or
any rule or regulation thereunder, in each case as now in effect as the same may
hereinafter  be in effect.  The Borrower owns no "margin  stock" except for that
described in the financial  statements referred to in Section 6.2 hereof and, as
of the date  hereof,  the  aggregate  value of all "margin  stock"  owned by the
Borrower  does not exceed  twenty-five  percent (25%) of the value of all of the
Borrower's  assets.  In connection with the Loan, the Borrower will upon request
of the  Lender  deliver  to the  Lender  a  statement  in  conformity  with  the
requirements of Federal Reserve Form U-1 referred to in said Regulation.


                        ARTICLE V - CONDITIONS PRECEDENT

         The  effectiveness  of this Agreement and the obligations of the Lender
to consummate any of the  transactions  contemplated  hereby shall be subject to
the satisfaction of the following conditions precedent,  at or prior to the time
of the funding of the loan or any part thereof:

         Section 5.1.      Documents and Instruments.

         The Lender  shall have  received  all the  instruments,  documents  and
property  contemplated to be delivered by the Borrower  hereunder,  and the same
shall be in full force and effect.


                                       14

<PAGE>



         Section 5.2.      Correctness of Warranties.

         All representations  and warranties  contained herein or otherwise made
to the Lender in connection herewith shall be true and correct.

         Section 5.3.      Certificates of Resolution.

         The  Board  of  Directors  of  the  Borrower  and  Guarantor   and,  if
shareholder  approval is deemed  necessary by any party, the shareholders of the
Borrower and Guarantor,  shall have passed specific resolutions  authorizing the
execution and delivery of all documents and the taking of all actions called for
by this  Agreement,  and the Borrower and Guarantor  shall have furnished to the
Lender copies of such resolutions, certified by its Secretary.

         Section 5.4.      Expenses of Lender.

         The  Borrower  promises  to  reimburse  the  Lender  promptly  for  all
reasonable  out-of-pocket expenses of every nature which the Lender may incur in
connection  with this  Agreement and the Note,  the making of any loans provided
for herein or the collection of the Borrower's indebtedness,  including, but not
limited to, any filing fees and documentary  stamps. Such expenses shall be paid
at closing or in a reasonable time thereafter upon receipt of written  invoices.
The Borrower  shall also pay  reasonable  postclosing  expenses  incurred by the
Lender on behalf of the Borrower,  including, but not limited to, preparation of
documents to terminate the loan and release the security therefor.  Furthermore,
the Borrower shall be liable for post-closing  collection  expenses,  including,
but not limited to, the  collection of  obligations  of the Borrower  hereunder,
including   reasonable   attorneys'  fees,   including  appellate   proceedings,
post-judgment proceedings and bankruptcy proceedings.  In the event the Borrower
fails to pay such expenses  within a reasonable  time, the Lender may either (a)
disburse  to itself  under the terms of the Note any sums  payable to Lender and
such disbursement  shall be considered with like effect as if same had been made
to Borrower,  or (b) pay such expenses on the  Borrower's  behalf and charge the
Borrower's account.

         Section 5.5.      Supporting Documents.

         On or prior to the closing  date,  the Lender  shall have  received the
following documents satisfactory in form and substance to the Lender and counsel
for the Lender  and,  as  requested  by the  Lender,  certified  by  appropriate
corporate or governmental authorities:

                  (a) a certificate of good standing of each Borrower  certified
by the Secretary of State, or other appropriate  governmental  authority, of the
state of incorporation;

                  (b) a copy of the articles of  incorporation  of each Borrower
certified by an  appropriate  officer of the Borrower  that the copy is complete
and  that the  articles  of  incorporation  have  not  been  amended,  annulled,
rescinded, or revoked;


                                       15

<PAGE>



                  (c) a copy of the  bylaws  of each  Borrower  in effect on the
date of this Agreement, accompanied by a certificate from an appropriate officer
of the Borrower that the copy is true and complete, and that the bylaws have not
been amended,  annulled,  rescinded,  or revoked since the date of the bylaws or
the last amendment reflected in the copy, if any;

                  (d) a copy of  resolutions  of the Board of  Directors  of the
Borrower  authorizing  the  execution,  delivery,  and  performance  of the Loan
Documents and the borrowing  thereunder,  and specifying the officer or officers
of the  Borrower  authorized  to execute the Loan  Documents,  accompanied  by a
certificate  from an  appropriate  officer  that  the  resolutions  are true and
complete,  were duly  adopted  at a duly  called  meeting  in which a quorum was
present and acting throughout,  or were duly adopted by written action, and have
not been amended,  annulled,  rescinded, or revoked in any respect and remain in
full force and effect on the date of the certificate;

                  (e) an incumbency  certificate containing the names and titles
of all duly  elected  officers  and  directors of the Borrower as of the date of
this Agreement,  accompanied by a certificate  from an appropriate  officer that
the information is true and complete;

                  (f) such  additional  supporting  documents  as the Lender may
request.

         Section 5.6.      Opinion of the Borrower's Counsel.

         On or prior to the  closing  date,  and to the extent  required  by the
Lender at the time of any  borrowing  hereunder,  the Lender shall have received
the favorable  opinion of counsel for Borrower  indicating  that the  execution,
delivery  and  performance  of this  Agreement  by the  Borrower  are within its
corporate  powers and  authorized,  in form and  substance  satisfactory  to the
Lender.


          ARTICLE VI - BORROWER'S AND GUARANTOR'S AFFIRMATIVE COVENANTS

         The Borrower and Guarantor,  jointly and severally,  covenant and agree
that until the Note,  together with interest and all other  indebtedness  to the
Lender under the terms of this Agreement,  is paid in full, unless  specifically
waived by the Lender in writing:

         Section 6.1.      Corporate Existence and Qualification.

         The Borrower  and  Guarantor  will do, or cause to be done,  all things
necessary  to  preserve,  renew and keep in full force and effect its  corporate
existence,  its material rights, licenses and permits and comply in all material
respects with all laws  applicable  to it,  operate its business in a proper and
reasonable  businesslike  manner and  substantially  as  presently  operated  or
proposed to be  operated;  and at all times  maintain,  preserve and protect all
franchises  and trade  names and  preserve  all  property  used or useful in the
conduct of its  business,  and keep the same in good repair,  working  order and
condition,  and from time to time make,  or cause to be made,  all  needful  and
proper repairs,  renewals,  replacements,  betterments and improvements thereto,
all as reasonably

                                       16

<PAGE>



necessary  so that  the  business  carried  on in  connection  therewith  may be
properly and advantageously conducted at all times.

         Section 6.2.      Financial Statements.

         Borrower  and  Guarantor  will  each keep  their  books of  account  in
accordance with generally accepted accounting  practices applied on a consistent
basis and will furnish to Lender the following:

         (a) Monthly financial  statements of each Co-Borrower and Guarantor and
subsidiaries  including,  at a minimum,  a balance sheet,  an income and expense
statement and a year-to-date  financial statement presenting  individual as well
as consolidating and consolidated  financial information on each Co-Borrower and
Guarantor and its subsidiaries, submitted within forty-five (45) days of the end
of each month prepared by and certified as such by the chief  financial  officer
of the applicable  Co-Borrower  and Guarantor  stating "the  undersigned  hereby
certifies  that the attached  financial  information is true and correct" in all
material  respects,  subject to audit  adjustments;  and containing  information
required  by  Lender,  including  monthly  accounts  receivable  agings for each
Co-Borrower  aged by invoice date as of the end of each month,  accounts payable
agings for each Co-Borrower as of the end of each month,  daily updated accounts
receivable balances for each Co-Borrower and customer address listings as Lender
may request from time to time; and

         (b) Annual  financial  statements  of each  Co-Borrower  and  Guarantor
including,  at a minimum,  a balance  sheet and an income and expense  statement
presenting  individual  as  well as  consolidating  and  consolidated  financial
information on the Borrower and Guarantor and its subsidiaries, submitted within
ninety (90) days from the end of each fiscal year end, prepared by and certified
as such by an independent certified public accountant acceptable to Lender which
may be satisfied by delivery of Guarantor's  Annual Report on Form 10-K as filed
with the Securities and Exchange Commission.

The Borrower and Guarantor also, with  reasonable  promptness,  shall furnish to
the Lender such other data as the Lender may reasonably request.

         Section 6.3.      Executive Officer's Certificates.

         The financial statements of Borrower,  called for by Section 6.2(a) and
(b), shall be  accompanied  by a certificate  of one of the principal  executive
officers of  Guarantor  stating that there exists no Event of Default as defined
in this  Agreement  and no event which,  with the giving of notice or passage of
time, or both, would constitute such an Event of Default, or, if this is not the
case,  that one or more specified  events of default or  above-specified  events
have occurred.

         Section 6.4.      Taxes and Claims.

         The Borrower and Guarantor shall properly pay and discharge: all taxes,

                                       17

<PAGE>



assessments and governmental charges upon or against any of them or their assets
prior to the date on which penalties  attach thereto, unless  and to the  extent
that such taxes are being diligently contested in good faith  and by appropriate
proceedings and appropriate reserves therefor have been established.

         Section 6.5.   Pay Indebtedness to Lender and Perform Other Covenants.

         The Borrower shall:  (a) make full and timely payments of the principal
of and  interest on the Note and all other  indebtedness  of the Borrower to the
Lender,  whether now existing or hereafter arising; and (b) duly comply with all
the terms and covenants contained in each of the instruments and documents given
to the Lender  pursuant to this  Agreement or of the times and places and in the
manner set forth herein.

         Section 6.6.      Litigation.

         The Borrower and  Guarantor  will  promptly  notify the Lender upon the
commencement of any action,  suit, claim,  counterclaim or proceeding against or
known  investigation of the Borrower (except when the alleged liability is fully
covered by insurance): (a) the result of which could materially adversely affect
the  business  of the  Borrower;  or (b) which  questions  the  validity of this
Agreement or any other  document  executed in connection  herewith or any action
taken or to be taken pursuant to any of the foregoing.

         Section 6.7.      Right of Inspection; Discussions.

         The Borrower will permit any person  designated  by the Lender,  at the
Borrower's  expense, to visit and inspect any of the property,  books,  records,
papers,  and  financial  reports of the  Borrower,  including  the making of any
copies thereof and abstracts  therefrom,  and to discuss its affairs,  finances,
and accounts with its principal  officers,  all at such reasonable  times and as
often as the Lender may  reasonably  request.  The Borrower will also permit the
Lender,  or its designated  representative,  to audit its financial and business
records.  Without limiting the foregoing in any way, the Borrower also agrees to
allow the Lender and/or certified public accountants  satisfactory to the Lender
to review the Borrower's financial statements, books, and records.

         Section 6.8.      Notices.

         The Borrower will promptly give notice to the Lender of:

                  (a) the  occurrence  of any  default or Event of  Default  (or
event  which  would  constitute  a  default  or  Event  of  Default  but for the
requirement that notice be given or time elapse or both) hereunder in which case
such notice shall specify the nature thereof,  the period of existence  thereof,
and the action that the Borrower proposes to take with respect thereto;


                                       18

<PAGE>



                  (b) the occurrence of any material casualty to any property of
the Borrower or any other force  majeure  (including,  without  limitation,  any
strike or other labor disturbance)  materially  affecting the operation or value
of the Borrower  (specifying  whether or not such  casualty or force  majeure is
covered by insurance); and

                  (c) the  commencement  or any material change in the nature or
status of any material litigation,  dispute,  investigation,  of proceeding that
may involve a claim for damages, injunctive relief, enforcement, or other relief
pending, being instituted,  or threatened by, against or involving the Borrower,
or any  attachment,  levy,  execution,  or other process being  instituted by or
against any assets of the  Borrower,  or any other  adverse  change  which might
materially  impair the conduct of the  Borrower's  business or might  materially
affect financially or otherwise its business,  operations,  assets,  properties,
prospects, or condition.

         Section 6.9.      ERISA Benefit Plans.

         The Borrower will comply with all  requirements of ERISA  applicable to
it and will not materially  increase its liabilities  under or violate the terms
of any  present or future  benefit  plans  maintained  by it  without  the prior
approval  of the  Lender.  The  Borrower  will  furnish to the Lender as soon as
possible and in any event within 10 days after the Borrower or a duly  appointed
administrator  of a plan (as defined in ERISA)  knows or has reason to know that
any reportable event, funding deficiency,  or prohibited transaction (as defined
in ERISA)  with  respect  to any plan has  occurred,  a  statement  of the chief
financial  officer  of  the  Borrower   describing  in  reasonable  detail  such
reportable event, funding deficiency,  or prohibited  transaction and any action
which Borrower  proposes to take with respect  thereof,  together with a copy of
the notice of such event given to the Pension  Benefit  Guaranty  Corporation or
the Internal  Revenue Service or a statement that said notice will be filed with
the annual report of the United States  Department of Labor with respect to such
plan if such filing has been authorized.

         Section 6.10.     Insurance.

         (a) The Borrower shall at all times maintain  hazard,  public liability
insurance  and Workers  Compensation  policies  insuring  against all claims for
personal or bodily injury,  death or property damage occurring upon, in or about
any  property of the  Borrower in amounts  not less than  $2,000,000.00  (with a
maximum  deductible  of  $1,000.00)  for  injury or damage to any one person and
$2,000,000.00 (with a maximum deductible of $1,000.00) for injury or damage from
any one accident and $100,000.00 for property  damage.  Such insurance  coverage
shall be in form and with existing carriers at current levels.

         (b) The Borrower  shall furnish to Lender  evidence that such insurance
is in effect, upon request, at no cost to Lender, including, but not limited to,
such originals or copies as the Lender may request of policies,  certificates of
insurance,  riders and  endorsements  relating  to such  insurance  and proof of
premium payments. The Lender shall be under no duty to examine such certificates
or to advise the Borrower in case the insurance is not in  compliance  herewith.
All such policies shall

                                       19

<PAGE>



name Lender as an additional insured.

         (c) The Borrower shall maintain existing credit insurance with existing
carrier at the current level of $5,000,000 and shall provide at closing a binder
from the existing  carrier  committing to issue credit insurance for Borrower at
the level of $10,000,000  effective  January 1, 1998.  Thereafter and throughout
the term of this Loan,  Borrower will maintain  such  insurance  with the Lender
being  named as Loss  Payee  for such  insurance  and  shall  furnish  to Lender
evidence  of same and  deliver  said  policy to Lender on or before  January 15,
1998.

         Section 6.11.     Main Bank of Account.

         During  the  term of this  Agreement  and so  long as the  Borrower  is
obligated to the Lender under the Note, AMSOUTH BANK, a bank organized under the
laws of Alabama,  shall be the  primary  bank of account  for the  Borrower  and
Guarantor  other than Capitol  Warehouse  and Carolina  Pacific.  Failure of the
Borrower or Guarantor to comply with this provision  shall  constitute a default
under the terms of this  Agreement,  entitling  the  Lender to all  remedies  of
default hereunder.

         Section 6.12.     Net Worth Requirement.

         The Guarantor  shall maintain a Net Worth of not less than  TWENTY-FOUR
MILLION  DOLLARS  ($24,000,000.00)  by the  end of the  1998  fiscal  year.  The
Tangible Net Worth must not be less than a negative  ($11,000,000) at the end of
the 1998 fiscal year end and a negative ($11,000,000) plus 25% of the net income
at the end of the 1999  fiscal  year and all  subsequent  years and at all times
thereafter.

         Section 6.13.     Leverage Ratio.

         The  Guarantor  shall not permit  its ratio of Total  Debt to  Earnings
Before Interest,  Taxes,  Depreciation  and Amortization  (EBITDA) to be greater
than 3.50:1.0 for the 1998 fiscal year end and 3.0:1.0 at all times thereafter.

         Section 6.14.     Interest Coverage Ratio.

         The Guarantor shall not permit its ratio of Earnings  Before  Interest,
Taxes and  Amortization  to Interest  Expense for the 1998 fiscal year end to be
less than 1.50:1.0 and less than 2.0:1.0 for the fiscal year end 1999 and at all
times thereafter.

         Section 6.15.     Lockbox and Accounts Receivable.

         The Borrower shall utilize  Lender's  lockbox  service  located at Post
Office Box  628062,  Orlando,  Florida  32862-8062,  or such other  place as the
Lender may designate in writing,  in the  collection of its accounts  receivable
and may be  charged  a  reasonable  fee.  Lockbox  remittances,  and  collection
inadvertently  remitted directly to the Borrower, and all other cash collections
including

                                       20

<PAGE>



but not limited to collections from governmental agencies will be deposited into
a bank-owned  collection  account,  where they will be held for one business day
prior  to being  used to  paydown  the  Line of  Credit.  Should  transfer  from
collection  account  to  paydown  Line of  Credit  create an  uncollected  funds
position in collection account,  interest charges for the uncollected funds will
be charged to account analysis.  In no case, will bank incur loss on transfer of
funds from  collection  account to Line of Credit.  All proceeds from Collateral
including  collections  of  Receivables  shall be  applied  directly  to  reduce
outstanding indebtedness on the Line of Credit.

         (a) At any time, and from time to time, upon Lender's  written request,
at the  Borrower's  expense,  Borrower  will  promptly  execute and deliver such
further  agreements  and documents and take such further  action as Lender shall
reasonably  deem  necessary or desirable in obtaining  the full benefits of this
Agreement and of the rights and powers herein granted.

         (b) If any of Borrower's  Receivables shall arise out of contracts with
the United States of America or any state thereof or any political  subdivision,
department,  agency or  instrumentality  of such  federal  or state  government,
Borrower  will,  if requested  by Lender,  in addition to the  requirements  and
conditions set forth above, execute any instruments and take any action required
by Lender in order that all  monies  due or to become  due under such  contracts
shall be assigned to Lender and notice thereof given to such federal  government
under the Federal Assignment of Claims Act, or in the case of a state statute or
local ordinance  analogous to said Claims Act, to such state government,  or the
appropriate political subdivision,  and Lender is hereby expressly authorized as
Borrower's agent to execute any such instruments and to take any such action.

         (c) Lender shall have the right to endorse  Borrower's  name on any and
all checks,  drafts,  or other forms of payment received  whenever  necessary to
collect the same, and Borrower will confirm  Lender's title thereto by executing
such instruments as Lender may from time to time require.  At Lender's  request,
Borrower  shall give notice of Lender's  security  interest  in  Receivables  to
Borrower's  debtors in such form and at such times as Lender  may  require,  and
Lender  may give such  notice  to  Borrower's  debtors  at any time or times and
collect the  Receivables  in Lender's  name.  In the event that any expenses are
incurred by Lender in collecting Receivables,  including the cost of maintaining
any  lockbox  and any  reasonable  legal fees,  such shall be an  obligation  of
Borrower's as is herein defined.

         (d) Borrower agrees to repay and remain liable for the repayment of all
loans  and  advances  made to or for the  Borrower's  account  and for all other
obligations.  It is expressly  agreed that any credits given as herein  provided
shall be conditioned  upon final payment to Lender in cash or solvent credits of
the item giving rise  thereto and  regarding  any item that is not so paid,  the
amount  of any  credit  given  shall  be  reversed,  whether  or not the item is
returned.

         (e) As of the close of each  calendar  month,  Lender  shall  render to
Borrower an  accounting  to Borrower as to the amount  which  Lender  shall have
advanced to Borrower and as to the amount received for Borrower's  account,  and
each account  rendered shall be deemed  acceptable to and binding upon us unless
Borrower submits to Lender in writing notice of any exception thereto

                                       21

<PAGE>



within ninety (90) days after the date thereof.

         (f) Borrower will not issue or grant any discount,  credit or allowance
as to  Borrower's  Receivables  other than that which is usual and normal in the
course of business  unless such is shown on  Borrower's  invoice and reported to
Lender as a deduction  from the  Receivables  against which Lender shall make an
advance.

         (g) Borrower shall immediately  advise Lender of any disputes or claims
as to the Receivables which Borrower believes to be substantial, and adjust them
promptly at Borrower's expense.

         (h) Upon the happening of any Event of Default as hereinabove provided,
then and in any such events, Lender shall have the following rights, in addition
to Lender's  rights and remedies  under this  Agreement  and at law all of which
shall be exercised in a commercially  reasonable  manner:  (i) Lender shall have
the right to incur  reasonable  attorneys' fees and legal expenses and any other
necessary expenditures in the taking of possession,  sale and/or preservation of
the Collateral,  which Borrower does hereby agree to pay, together with interest
thereon  from the date of such  expenditures;  (ii) Lender shall then and at all
times  thereafter  have the  right,  without  notice to  Borrower,  to  collect,
litigate, extend the time of payment of, compromise,  settle for cash, credit or
otherwise, and upon any terms or conditions,  all or any part of the Receivables
and thereby discharge and/or release the debtor and all others who may be liable
for the payment of such  Receivables or any part thereof;  (iii) Lender may sell
the  Collateral,  including  Receivables  or any in which Lender may then have a
security  interest,  in bulk or in separate  lots,  at either  public or private
sale, without  advertisement  which is hereby waived, and upon sending notice to
Borrower ten (10) days prior to such sale or other  disposition,  at such prices
and upon such terms and  conditions as Lender may determine and Lender is hereby
authorized to be a bidder and purchaser at any such public sale and/or sales.

         (i) Borrower  shall be entitled to credit only for the actual amount of
the cash received by Lender as a result of its exercise of such rights, less all
Lender's costs and expenses  including  collection and legal expenses,  storage,
processing,  transportation  and  sale.  If there be a surplus  remaining  after
applying the net proceeds of any such collection of Receivables  and/or sales of
the  Collateral  to Borrower's  obligations,  Lender shall remit such surplus to
Borrower and if there be a  deficiency,  Borrower  shall remain liable to Lender
therefor. The rights herein granted to Lender shall be in addition to and not in
lieu of all other rights to which Lender is entitled under this Agreement or any
supplement or amendment  hereto,  or at law; and resort to security shall not be
required at any time.

         (j) Borrower hereby constitutes any person whom Lender may designate as
Borrower's  attorney-in-fact  with power to send  request  for  verification  of
account to any debtor of Borrower  and, (a) to receive,  open and dispose of all
mail  addressed  to  Borrower;  (b) to  endorse  Borrower's  name  on any  notes
acceptances,  checks,  drafts,  money  orders or other  evidences  of payment or
collateral that may come into Lender's  possession;  (c) in the event of default
by Borrower hereunder to sign

                                       22

<PAGE>



Borrower's name on any invoices  relating to any Receivables,  or drafts against
debtors,  assignments and verifications of accounts and notices to debtors;  and
(d) in the event of  default  by  Borrower  hereunder  to do all other  acts and
things necessary to carry out this Agreement.  All acts of such attorney-in-fact
or designee  shall not be liable for any acts of  commission or omission nor for
any error of judgment or mistake of fact or law other than gross  negligence  or
willful misconduct.  This power, being coupled with an interest,  is irrevocable
while any obligation shall remain unpaid.

         (k)  Borrower  hereby  irrevocably  authorizes  and directs any and all
accountants  at any time acting for Borrower to give Lender any  information  it
may from time to time request  concerning the financial  affairs of Borrower and
to furnish  Lender with copies of any and all  statements,  documents,  records,
paper, etc. in their possession  pertaining  thereto.  Borrower will maintain at
its own cost and  expense  complete  records  with  respect to the  Receivables,
including but not limited to records of payment received and all credits granted
with respect thereto,  all adjustments thereof, and all other dealings affecting
any of the  Receivables.  Borrower  agrees that  Lender has a separate  security
interest  in all of the books  and  records  pertaining  to the  Collateral  and
Borrower does hereby  assign the same to Lender.  Following an Event of Default,
Borrower will deliver any such books and records to Lender or its representative
at any time upon Lender's demand at Borrower's cost. During any periodic audits,
Lender may inspect and make extracts  from all of  Borrower's  books and records
upon its premises.

         (l) Borrower  further  agrees from time to time at Lender's  request to
deliver to Lender any or all original or other  documents which form any part of
the  Receivables  including but not limited to all original  contracts,  orders,
invoices, bills of lading, and shipping receipts and Lender shall succeed to all
rights,  remedies,  securities and liens which Borrower may have with respect to
the  Receivables,  including  guaranties of  Receivables  or other  contracts of
suretyship with respect  thereto,  and Borrower shall deliver to Lender separate
written instruments confirming Lender's security interest in (or assignments of)
any of the same.

         Section 6.16.     Field Audits.

         Borrower agrees to quarterly asset based examinations of the Borrower's
books,  records  and  operations,  at  Borrower's  expense,  by the  Lender or a
representative  of the Lender and reserves  the right to require a  satisfactory
field examination  prior to funding (other than the initial funding  hereunder).
The Lender  also may  conduct  periodic  verifications  of  accounts  receivable
balances by both written and telephone communication methods.

         Section 6.17.     Collateral Reporting.

         The  Borrower  shall  provide  the Lender  with the  following:  (1) an
updated  accounts  receivable  balance  submitted  on a daily  basis in form and
substance acceptable to Lender; (2) an accounts receivable aging each month aged
by invoice  date, as of the end of each month within ten (10) days after the end
of the month;  (3) a  customer  address  list the Lender  will from time to time
require;  and (4) an accounts  payable  aging each month,  as of the end of each
month within twenty

                                       23

<PAGE>



(20) days after the end of the  month;  and (5) any other  information  that the
Lender may from time to time require.

         Section 6.18.     Observance of Laws.

         The Borrower will conform to and duly observe in all material  respects
all  laws,  regulations,  and  other  valid  requirements  of  any  governmental
authority with respect to the conduct of its business, including but not limited
to, applicable ERISA, environmental and transportation laws.

         Section 6.19.     Subsidiaries.

         The  Borrower and  Guarantor  shall cause each of its  subsidiaries  to
observe and perform each covenant and agreement.  All  computations  required in
connection with such financial covenants shall be made for the Guarantor and its
subsidiaries  on  a  combined  or  consolidated   basis,  after  elimination  of
intercompany items.

         Section 6.20.     Capitalization Ratio.

         The Guarantor and its  subsidiaries  on a consolidated  basis shall not
permit its ratio of Debt to Capitalization to exceed 65.0%.


                   ARTICLE VII - BORROWER'S NEGATIVE COVENANTS

         Borrower covenants and agrees from the date hereof and until payment in
full of the principal of and interest on the Note, and all other indebtedness to
the Lender under this Agreement,  unless the Lender shall  otherwise  consent in
writing, which will not be unreasonably withheld or delayed, it will not, either
directly or indirectly:

         Section 7.1.      Type of Business.

         Engage  in any  business  not  authorized  by  Borrower's  Articles  of
Incorporation or by applicable law.

         Section 7.2.      Change in Ownership or Management.

         The Guarantor  shall not,  either  directly or  indirectly,  permit any
change in its Senior  management or in the  management of its business,  without
the prior written consent of the Lender.

         Section 7.3.      Acquisitions and Mergers.

         The Borrower shall not merge or  consolidate or transfer  substantially
all of their assets  (other than in a  reorganization  or other  transaction  in
which  no  change  in  control  occurs  and  such  organizations  remain  in the

                                       24

<PAGE>



transportation business) without the prior written approval of the Lender.

         Section 7.4.      Capital Expenditures.

         The Guarantor and its subsidiaries  may not make Capital  Expenditures,
excluding expenditures for rolling stock, in an aggregate amount per fiscal year
in excess of FIVE  HUNDRED  THOUSAND  DOLLARS  ($500,000.00),  without the prior
written consent of the Lender.

         Section 7.5.      Guaranty.

         The Guarantor and its  subsidiaries  will not guarantee or otherwise in
any way  become  responsible  for  obligations  of any other  person or  entity,
whether by  agreement  to purchase  the  indebtedness  of any other  person,  or
agreement for the  furnishing to funds to any other person  through the purchase
of goods, supply of services (or by way of stock purchase, contribution, advance
or loan) for the purpose of paying or discharging the  indebtedness of any other
person, or otherwise, except those approved in writing by Lender.

         Section 7.6.      Investment and Loans.

         The Borrower and Guarantor will not,  directly or indirectly,  acquire,
purchase or otherwise  make any  investment  in or make any loans to acquire any
interest whatsoever in, any other person in an amount in excess of $1,000,000 in
cash per  acquisition or an aggregate  amount of $5,000,000 in cash;  except (1)
Qualified  Investments,  or (2) the stock of any existing subsidiaries disclosed
to the Lender in writing in the Loan application, or (3) acquisitions solely for
stock of the  Guarantor,  or (4)  upon  obtaining  written  consent  of  Lender,
provided  in each case  that all such  organizations  are in the  transportation
business.

         Section 7.7.      Disposition or Encumbrance of Receivables.

         The Borrower will not sell, assign or discount,  or grant or permit any
lien on any of its  accounts or notes  receivables,  other than the  discount of
such notes in the ordinary course of the Borrower's business.

         Section 7.8.      Sale-Leasebacks.

         Other than rolling  stock,  the Borrower  will not sell or transfer any
property and lease it back for the same use,  provided  however,  Borrower shall
not  have  off  balance  sheet   transactions   exceeding  ONE  MILLION  DOLLARS
($1,000,000.00) in the aggregate each year.

         Section 7.9.      Leases.

         The  Borrower  will  not  enter  into  any  future  lease  (other  than
capitalized leases that are otherwise  permitted under this commitment or leases
for  rolling  stock),  as  lessee,  if  such  lease  (a) has an  unexpired  term
(including renewals at the option of the lessee) of more than seven years, (b)

                                       25

<PAGE>



provides  for  aggregate  rental  payments  during any fiscal  year in excess of
$100,000, or (c) if the rental payments thereunder, together with all other such
leases,  would provide for aggregate  rental  payments during any fiscal year in
excess of $500,000, without prior written approval of the Lender.

         Section 7.10.     Liens.

         The  Borrower  will not  permit  any lien on any of its  properties  or
assets,  whether now owned or hereafter acquired,  other than any liens mutually
agreed upon prior to closing or outside the normal  course of business and those
listed below:

                  (a)      liens in favor of Lender;

                  (b) existing liens identified in the Co-Borrower's application
for this Loan,  including any liens  relating to the  restructuring  of existing
fixed asset and/or vehicle financing with another financial institution;

                  (c)  deposits  under  workmen's   compensation,   unemployment
insurance and Social Security laws;

                  (d) liens imposed by law, such as carriers', warehousemen's or
mechanics'  and  materialmen's  liens,  incurred  in good faith in the  ordinary
course of business and that are not  delinquent or that are subject to Permitted
Contests;

                  (e) any lien arising out of any litigation,  legal  proceeding
or judgement that is subject to a Permitted Contest, and any pledges or deposits
to secure,  or in lieu of, any surety,  stay or appeal bond with  respect to any
such litigation, legal proceeding or judgement;

                  (f) liens for taxes, assessments or other governmental charges
or levies that are not delinquent or that are subject to Permitted Contests;

                  (g)  liens  created  after  the Loan  closing  to  secure  the
acquisition  cost of vehicles and fixed assets for use in the ordinary course of
business,  provided  that (1) any such lien is confined  to the fixed  assets so
acquired;  and (2) the  indebtedness  secured  by such lien does not  exceed the
purchase  price or fair market value,  whichever is less, of the fixed assets so
acquired at the time of their acquisition; and

                  (h) liens  created  by loans to  shareholders  secured  by the
shareholders  restricted stock, so long as each Co-Borrower and Guarantor are in
compliance with all financial covenants.

         Section 7.11.     Take or Pay Contracts.

         The Borrower will not enter into any take or pay contract.


                                       26

<PAGE>



         Section 7.12.     Other Special Covenants.

         The Borrower and Guarantor will not allow any  modifications  involving
the inclusion of Receivables of additional  subsidiaries  to be made to eligible
receivables in the event  additional  acquisitions  are made,  without the prior
written approval of Lender.


                        ARTICLE VIII - EVENTS OF DEFAULT

         Section 8.1.      Events.

         In the event:

                  (a)      Payment of Obligations to Lender.

                  The  Borrower  or  Guarantor  fails  to  make  payment  of any
principal,  interest,  or other amount due on any  indebtedness  owed the Lender
hereunder within ten (10) days of the due date thereof without further notice or
demand,  or  fails to make any  other  payment  to the  Lender  as  contemplated
hereunder either by the terms hereof or otherwise; or

                  (b)      Representation or Warranty.

                  Any  representation  or  warranty  made or deemed  made by the
Borrower or Guarantor  herein or in any writing  furnished in connection with or
pursuant  to the  loan  application  and  loan  commitment  for  the  Loan or in
connection  with  or  pursuant  to any  certificate  delivered  under  the  Loan
Documents  shall be false in any material  adverse respect on the date when made
or when deemed made; or

                  (c)      Covenants.

                  The  Borrower  or  Guarantor  defaults in the  performance  or
observance of or breaches any agreement, covenant, term, or condition binding on
it  contained  in the Loan  Documents  for a period  of thirty  (30) days  after
written  demand  (provided  no written  demand  shall be required  for breach of
Borrower's  obligations  to notify Lender of events of defaults set forth herein
which require Borrower to notify Lender of same); or

                  (d)  The Borrower's Liquidation; Dissolution; Bankruptcy; Etc.

                  Any  liquidation  or dissolution of the Borrower or Guarantor,
suspension of the business of the Borrower, or the filing or commencement by the
Borrower of a voluntary  petition,  case,  proceeding,  or other action  seeking
reorganization,  arrangement,  readjustment  of its debts,  or any other  relief
under any existing or future law of any jurisdiction, domestic or foreign, state
or federal,  relating to  bankruptcy,  insolvency,  reorganization  or relief of
debtors, or any other action

                                       27

<PAGE>



of the Borrower  indicating its consent to, approval of, or acquiescence in, any
such petition,  case,  proceeding,  or other action seeking to have an order for
relief entered with respect to it or its debts;  the application by the Borrower
for, or the  appointment,  by consent or acquiescence  of, a receiver,  trustee,
custodian,  or  other  similar  official  for  the  Borrower  or  for  all  or a
substantial  part of its  property;  the making by the Borrower of an assignment
for the benefit of creditors;  or the inability of the Borrower or the admission
by the Borrower in writing of its inability to pay its debts as they mature; or

                  (e)      Order of Dissolution.

                  Any order is entered in any  proceedings  against the Borrower
or Guarantor decreeing the dissolution or split-up of the Borrower or Guarantor,
and such order remains in effect for more than sixty (60) days; or

                  (f)      Reports and Certificates.

                  Any report,  certificate or financial  statement  delivered to
the Lender by the  Borrower is at any time false or  misleading  in any material
adverse respect; or

                  (g)      Judgments.

                  The  rendition  of a  final  uninsured  judgment  against  the
Borrower for the payment of damages or money in excess of Five Hundred  Thousand
Dollars  ($500,000.00) if the same is not discharged,  bonded off or transferred
to other  security or if a writ of execution  or similar  process is issued with
respect  thereto  and is not stayed  within  the time  allowed by law for filing
notice of appeal of the final judgment; or

                  (h)      Liens Imposed by Law.

                  The  violation  of  any  law or any  act  or  omission  by the
Borrower that results in the  imposition of a lien by operation of law on any of
its property, if the lien is not discharged,  bonded off or transferred to other
security within sixty (60) days after it has attached and if the lien relates to
a claim for the payment of damages or money in excess of Five  Hundred  Thousand
Dollars ($500,000.00); or

                  (i)      Corporate Existence.

                  Any act or omission  (formal or  informal)  of the Borrower or
Guarantor or its officers,  directors,  shareholders, or partners leading to, or
resulting  in, the  termination,  invalidation  (partial or total),  revocation,
suspension,  interruption, or unenforceability of its existence, or the transfer
or disposition  (whether by sale, lease, or otherwise) to any person of all or a
substantial part of its property.


                                       28

<PAGE>



         THEN:

         In any of the above mentioned  events,  any holder of the Note executed
pursuant  hereto with notice to Borrower may, at such holder's  option,  declare
the said Note to be fully  due and  payable  and the same  shall  thereupon  all
immediately  become due and payable in their  aggregate  amounts and Lender,  in
addition to any other remedy  permitted by law,  may, at its option,  proceed to
protect  and enforce its rights by an action at law or in equity or by any other
appropriate proceedings, whether for the specific performance of any covenant or
agreement  contained in this  Agreement,  or in aid of the exercise of any power
granted in this  Agreement,  or proceed to enforce the payment of the Note or to
enforce  any other  legal,  or  equitable  rights of Lender,  including  but not
limited  to, the rights of Lender  pursuant to the  Florida  Statutes  and other
applicable  law. The events of default and remedies  after  default set forth in
this  Section 8.1 are intended to be in addition to the  provisions  in the Note
under the captions "Events of Default" and "Remedies After Default".

         Section 8.2.      Rights and Remedies Cumulative.

         No right or remedy herein  conferred  upon the Lender is intended to be
exclusive  of any other  right or remedy  contained  herein,  in the Note,  Loan
Documents  or in any  instrument  or document  delivered in  connection  with or
pursuant to this  Agreement,  and every such right or remedy shall be cumulative
and shall be in addition to every  other such right or remedy  contained  herein
and  therein or now or  hereafter  existing at law or in equity or by statute or
otherwise.

         Section 8.3.      Rights and Remedies Not Waived.

         No course of dealing between the Borrower and the Lender or any failure
or delay  on the  part of the  Lender  in  exercising  any  rights  or  remedies
hereunder  shall operate as a waiver of any rights or remedies of the Lender and
no single or partial exercise of any rights or remedies  hereunder shall operate
as a waiver or preclude the exercise of any other rights or remedies hereunder.

         Section 8.4.      Waiver of Default.

         The  Lender at any time may waive any  default  or any Event of Default
which shall have occurred and any of its consequences, in which case the parties
hereto shall be restored to their former  positions  and rights and  obligations
hereunder,  respectively;  but no such waiver shall extend to any  subsequent or
other default or impair any right consequent  thereon,  and no such waiver shall
be effective  unless it is in a written  document  executed by a duly authorized
officer and then only to the extent specifically recited therein.



                                       29

<PAGE>



                           ARTICLE IX - MISCELLANEOUS

         Section 9.1.      Course of Dealing; Amendments; Waiver.

         No course of dealing  between the parties  hereto shall be effective to
amend,  modify,  or change any  provision  of this  Agreement  or any other Loan
Document. No amendment or waiver of any provision of this Agreement or any other
Loan Document, nor consent to any departure by the Borrower therefrom,  shall in
any event be effective unless the same shall be in writing and signed by Lender,
unless otherwise specifically provided, and each such waiver or consent shall be
effective only in the specific  instance and for the specific  purpose for which
given.

         Section 9.2.      Lien; Setoff By Lender.

         The  Borrower  hereby  grants to the Lender a  continuing  lien for all
indebtedness  and other  liabilities  of the Borrower to the Lender upon any and
all moneys,  securities,  and other  property of the  Borrower  and the proceeds
thereof,  now or hereafter held or received by or in transit to, the Lender from
or for the Borrower,  whether for safekeeping,  custody,  pledge,  transmission,
collection or otherwise, and also upon any and all deposits (general or special)
and credits of the Borrower with, and any and all claims of the Borrower against
the Lender at any time  existing.  Upon the  occurrence of any Event of Default,
the  Lender is  hereby  authorized  at any time and from  time to time,  without
notice  to the  Borrower,  to  setoff,  appropriate,  and apply any or all items
hereinabove  referred to against all indebtedness  and other  liabilities of the
Borrower to the Lender,  whether under this Agreement or otherwise,  and whether
now existing or hereafter arising.

         Section 9.3.      Liability of Lender to Third Parties.

         The  Lender  shall in no event be  responsible  or liable to any person
other than the  Borrower and  Guarantor  for its  disbursement  of or failure to
disburse the funds or any part  thereof,  and others shall not have any claim or
right  against the Lender under this  Agreement  or the Lender's  administration
thereof.

         Section 9.4.      Waivers.

         Except as provided  herein,  the Borrower waives  presentment,  demand,
protest, notice of default,  nonpayment,  partial payments and all other notices
and  formalities  relating to this  Agreement  other than  notices  specifically
required  hereunder.  The Borrower consents to and waives notice of the granting
of  indulgences  or  extensions  of time of payment,  the taking or releasing of
security,  the addition or release of persons primarily or secondarily liable on
or with respect to liabilities of the Borrower to the Lender, all in such manner
and at such time or times as the Lender may deem  advisable.  No act or omission
of the  Lender  shall in any way  impair or affect  any of the  indebtedness  or
liabilities  of the  Borrower  to the  Lender  or  rights  of the  Lender in any
security.  No delay  by the  Lender  to  exercise  any  right,  power or  remedy
hereunder  or under  any  security  agreement,  and no  indulgence  given to the
Borrower in case of any default, shall impair any such

                                       30

<PAGE>



right,  power or remedy or be construed as having created a course of dealing or
performance contrary to the specific provisions of this Agreement or as a waiver
of any default by the Borrower or any acquiescence  therein or as a violation of
any of the terms or  provisions  of this  Agreement.  The Lender  shall have the
right at all times to enforce the  provisions  of this  Agreement  and all other
documents executed in connection herewith in strict accordance with their terms,
notwithstanding any course of dealing or performance by the Lender in refraining
from so doing at any time and  notwithstanding  any custom in the banking trade.
No course of dealing  between the  Borrower  and the Lender  shall  operate as a
waiver of any of the Lender's rights.

         Section 9.5.      Assignment and Participation.

         This Loan may not be assigned by the Co-Borrowers  without the Lender's
prior  written  consent.  At  any  time,  the  Lender  may  grant  one  or  more
participations  of 49% or less in this Loan to participants  of its choice.  Any
such  participant  may exercise  rights of setoff and banker's  lien against the
Co-Borrower with respect to its participation as if it had made a direct loan to
the Co-Borrower.  The Lender may divulge to any such participant any information
the Lender may obtain with  respect to the  Co-Borrower,  the  Guarantor  or any
Collateral in connection with this Loan.  Notwithstanding the foregoing,  Lender
may sell any or all of the Loan if said Loan is in default.

         Section 9.6.      Funds Not Assignable.

         The  proceeds  of the loan shall not be assigned  by the  Borrower  nor
subject to the process of any court upon legal action by or against the Borrower
or by or against anyone claiming under or through Borrower,  and for the purpose
of this  Agreement,  the funds  shall  remain  and be  considered  the money and
property of the Lender until the Borrower is entitled to have them  disbursed as
provided  herein.  Nothing  herein  contained  shall be  considered as in anyway
modifying,  or subordinating the obligations  previously given or to be given by
the Borrower as security for the loan and such  obligations  shall be and remain
in full force and effect,  this  Agreement  being  intended  only as  additional
security  for the loan and to insure its use for the  purposes  intended  by the
Lender and Borrower.

         Section 9.7.      Indemnity.

         The Borrower  agrees to indemnify and hold the Lender harmless from and
against all damages, claims, actions, causes of action, losses, costs, expenses,
liability,  penalties  and interest  (including  attorney's  fees and  expenses)
directly or indirectly  resulting from,  occurring in connection with or arising
out of (a) any  inaccurate  representation  or warranty  made by or on behalf of
Borrower to Lender in connection  with this Loan; (b) any breach by the Borrower
of any of its  obligations  under this Loan or the Loan  Documents;  or (c) this
Loan and the  transactions  contemplated  by this Loan.  This  Section 9.7 shall
survive the  execution and delivery of the Loan  Documents,  the closing of this
Loan and the payment of this Loan in full.


                                       31

<PAGE>



         Section 9.8.      Termination by the Borrower.

         The Borrower may terminate  this Agreement in its entirety by giving at
least ten (10) days  prior  notice of its  intention  so to do and by payment in
full  of all  obligations  hereunder  outstanding  on  the  date  specified  for
termination.

         Section 9.9.      Arbitration.

         Any  controversy,  claim,  dispute or disagreement  arising out of this
commitment or the Loan will be settled by  arbitration  in  accordance  with the
Commercial Arbitration Rules of the American Arbitration Association.  Judgement
on any  award  rendered  by the  arbitrator(s)  in any such  arbitration  may be
entered in any court  having  jurisdiction  thereof.  The  Co-Borrowers  and the
Lender  specifically  acknowledge  and agree  that this  commitment  involves  a
"transaction   involving  commerce"  under  the  Federal  Arbitration  Act.  Any
arbitration shall take place in Orlando, Florida at the Lender's election.

         Section 9.10.     Notices.

         Any written  notice,  demand or request  that is required to be made in
any of the Loan  Documents  shall be  served  in  person,  or by  registered  or
certified mail, return receipt requested,  or by express mail or similar carrier
service,  addressed  to the party to be served at the  address  set forth in the
first  paragraph  hereof.  The addresses  stated herein may be changed as to the
applicable party by providing the other party with notice of such address change
in the manner  provided in this  paragraph.  In the event that  written  notice,
demand or request is made as provided in this paragraph,  then in the event that
such notice is returned to the sender by the United  States postal system or the
courier service  because of insufficient  address or because the party has moved
or  otherwise,  other than for  insufficient  postage or payment to the courier,
such writing  shall be deemed to have been  received by the party to whom it was
addressed  on the date that such  writing  was  initially  placed in the  United
States postal system or deposited  with the courier  service with the postage or
cost thereof prepaid in full by the sender.

         Section 9.11.     Controlling Agreement.

         In the event any provision of this Agreement is  inconsistent  with any
provision  of any other  document,  whether  heretofore  executed,  required  or
executed  pursuant  to this  Agreement  or  otherwise,  the  provisions  of this
Agreement shall be controlling.

         Section 9.12.     Titles.

         Titles to the sections of this Agreement are solely for the convenience
of the parties hereto and are not an aid in the interpretation of this Agreement
or any part thereof.


                                       32

<PAGE>



         Section 9.13.     Venue and Jurisdiction.

         In any  litigation in connection  with or to enforce this  Agreement or
any of the other  Loan  Documents,  the  Borrower  irrevocably  consents  to and
confers  personal  jurisdiction on the courts of the State of Florida located in
Orange County or the United States courts located within the Middle  District of
the State of Florida, expressly waives any objections as to venue in any of such
courts,  and  agrees  that  service of process  may be made on the  Borrower  by
mailing a copy of the summons and  complaint by  registered  or certified  mail,
return receipt requested,  to the address set forth herein below the name of the
Borrower  on the  signature  page  hereto (or  otherwise  expressly  provided in
writing).  Nothing  contained  herein  shall,  however,  prevent the Lender from
bringing any action or  exercising  any rights within any other court in Florida
or  from  obtaining  personal  jurisdiction  by any  other  means  available  by
applicable law.

         Section 9.14.     Governing Law.

         The validity, interpretation, and enforcement of this Agreement, of the
rights  and  obligations  of the  parties  hereto,  and of the  other  documents
delivered  in  connection  herewith  shall be  governed  by, and  construed  and
interpreted  in  accordance  with,  the laws of the State of Florida,  excluding
those laws  relating to the  resolution  of conflicts  between laws of different
jurisdictions.

         Section 9.15.     Legal or Governmental Limitations.

         Anything  contained in this Agreement to the contrary  notwithstanding,
the  Lender  shall not be  obligated  to extend  credit or make any loans to the
Borrower in an amount in violation of any limitations or  prohibitions  provided
by any applicable statute or regulation.

         Section 9.16.     Counterparts.

         This  Agreement  and any  amendment  hereof may be  executed in several
counterparts and by each party on a separate counterpart,  each of which when so
executed and delivered  shall be an original,  and all of which  together  shall
constitute one instrument.

         Section 9.17.     Waiver of Trial By Jury.

         The Borrower,  the Guarantor and the Lender knowingly,  voluntarily and
intentionally waive the right any of them may have to a trial by jury in respect
of any litigation  based hereon,  or arising out of, under or in connection with
the Loan Documents and any agreement  contemplated to be executed in conjunction
therewith,  or any course of  conduct,  course of dealing,  statements  (whether
verbal or  written)  or  actions  of any  party.  This  provision  is a material
inducement  for  the  Lender  entering  into  the  loan  evidenced  by the  Loan
Documents.


                                       33

<PAGE>



         Section 9.18.     Confidentiality.

         Lender  acknowledges  that  Guarantor is a Reporting  Company under the
Exchange Act of 1934, as amended, and agrees to keep confidential and not to use
in any manner  other  than in  connection  with this  Agreement,  any  nonpublic
information obtained by the Lender in connection herewith.

         Section 9.19.     Total Liability of Each Co-Borrower.

         Notwithstanding  anything to the  contrary in the Loan  Documents,  the
total  liability of each  Co-Borrower  under the Loan Documents shall not exceed
the amount disbursed to or on behalf of such Co-Borrower  together with interest
costs and attorney fees.  Nothing  contained in this  paragraph  shall limit the
liability of the Guarantor pursuant to the Guaranty.

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

Signed, sealed and delivered             AMSOUTH BANK, a bank organized under
in the presence of:                      the laws of Alabama


                                         By: /s/ Anthony Stiffler
                                         Anthony Stiffler,
                                         Vice President

                                                    "Lender"


                                         CARROLL FULMER & COMPANY, INC.,
                                         a Florida corporation


                                         By: /s/ Philip A. Belyew 
                                         Philip A. Belyew,
                                         Chairman of the Board



                                         CAROLINA PACIFIC DISTRIBUTORS, INC.,
                                         a North Carolina corporation


                                         By: /s/ Philip A. Belyew
                                         Philip A. Belyew,
                                         Chairman of the Board


                                       34

<PAGE>

                                         CAPITOL WAREHOUSE, INC.,
                                         a Kentucky corporation


                                         By: /s/ Philip A. Belyew
                                         Philip A. Belyew,
                                         Chairman of the Board



                                         SERVICE EXPRESS, INC.,
                                         an Alabama corporation


                                         By: /s/ Philip A. Belyew 
                                         Philip A. Belyew,
                                         Chairman of the Board

                                                   "Borrower"


                                         TRANSIT GROUP, INC.,
                                         a Florida corporation


                                         By: /s/ Philip A. Belyew
                                         Philip A. Belyew,
                                         President and Chief Executive Officer

                                                   "Guarantor"




STATE OF GEORGIA

COUNTY OF ________________

         The foregoing  instrument was acknowledged  before me this _____ day of
December,  1997, by Anthony  Stiffler as Vice  President of AmSouth Bank, a bank
organized  under the laws of Alabama,  on behalf of the bank.  He is  personally
known to me or has produced _______________________________ as identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:

                                       35

<PAGE>

STATE OF GEORGIA

COUNTY OF ________________

         The foregoing  instrument was acknowledged  before me this _____ day of
December,  1997, by Philip A. Belyew, as Chairman of the Board of Carroll Fulmer
& Company,  Inc., a Florida  corporation,  on behalf of the  corporation.  He is
personally  known  to  me or  has  produced  _______________________________  as
identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:



STATE OF GEORGIA

COUNTY OF _____________

         The foregoing  instrument was acknowledged  before me this _____ day of
December,  1997,  by Philip A.  Belyew,  as  Chairman  of the Board of  Carolina
Pacific  Distributors,  Inc.,  a North  Carolina  corporation,  on behalf of the
corporation.    He   is    personally    known    to   me   or   has    produced
_______________________________ as identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:


STATE OF GEORGIA

COUNTY OF _____________

         The foregoing  instrument was acknowledged  before me this _____ day of
December,  1997,  by Philip  A.  Belyew,  as  Chairman  of the Board of  Capitol
Warehouse,  Inc., a Kentucky  corporation,  on behalf of the corporation.  He is
personally  known  to  me or  has  produced  _______________________________  as
identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:


                                       36

<PAGE>

                                      
STATE OF GEORGIA

COUNTY OF _____________

         The foregoing  instrument was acknowledged  before me this _____ day of
December,  1997,  by Philip  A.  Belyew,  as  Chairman  of the Board of  Service
Express,  Inc.,  an Alabama  corporation,  on behalf of the  corporation.  He is
personally  known  to  me or  has  produced  _______________________________  as
identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:



STATE OF GEORGIA

COUNTY OF _____________

         The foregoing  instrument was acknowledged  before me this _____ day of
December, 1997, by Philip A. Belyew, as President and Chief Executive Officer of
Transit Group, Inc., a Florida corporation,  on behalf of the corporation. He is
personally  known  to  me or  has  produced  _______________________________  as
identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:











                                       37
<PAGE>


             AMENDMENT TO ADVISED REVOLVING LINE OF CREDIT AGREEMENT


         THIS  AGREEMENT  dated  as of the  14th day of  January,  1998,  by and
between AMSOUTH BANK, a bank organized under the laws of Alabama,  whose mailing
address is Post Office Box 588001,  Orlando,  Florida 32858 (the "Lender"),  and
CARROLL FULMER & COMPANY,  INC., a Florida  corporation,  whose address is P. O.
Box 5000, Groveland,  Florida 34736-5000 ("Carroll Fulmer") and CAROLINA PACIFIC
DISTRIBUTORS,  INC., a North Carolina corporation, whose address is 5625 Surrett
Drive Extension, Archdale, North Carolina 27263 ("Carolina Pacific") and CAPITOL
WAREHOUSE,  INC., a Kentucky  corporation,  whose address is 403 W. Main Street,
Frankfurt,  Kentucky 40601 ("Capitol  Warehouse") and SERVICE EXPRESS,  INC., an
Alabama corporation,  whose address is P.O. Box 1009, Tuscaloosa,  Alabama 35403
("Service  Express")  (Carroll Fulmer,  Carolina Pacific,  Capitol Warehouse and
Service  Express are  together  hereinafter  referred to as the  "Borrower"  and
individually  referred to as a "Co-Borrower";  references applicable to Borrower
shall also be  applicable  to each  Co-Borrower),  and TRANSIT  GROUP,  INC.,  a
Florida corporation, whose address is Overlook III, 2859 Paces Ferry Road, Suite
1740, Atlanta, Georgia 30339 (the "Guarantor").


                              W I T N E S S E T H:

         WHEREAS, the Lender, the Borrower and Guarantor entered into an Advised
Revolving  Line of Credit  Agreement  dated as of  December  18, 1997 (the "Loan
Agreement"),  which Loan  Agreement  provides  that the Borrower may borrow from
Lender and repay and reborrow a principal  amount not to exceed  TWENTY  MILLION
DOLLARS ($20,000,000.00); and

         WHEREAS,  the Lender,  the Borrower and the Guarantor  desire to modify
the terms and  conditions of the Loan  Agreement in the manner  hereinafter  set
forth to permit other  subsidiaries  of Transit Group,  Inc. to join in the Loan
Agreement from time to time and be bound by its terms; and

         WHEREAS,  the loan  arrangement  made pursuant to the Loan Agreement is
evidenced  by a Revolving  Credit Note in the  principal  sum of TWENTY  MILLION
DOLLARS ($20,000,000.00) (the "Note") as may be amended or restated from time to
time; and

         WHEREAS,  the Guarantor  hereby confirms its guaranty of payment of the
indebtedness of Borrower to Lender in accordance  with the guaranty  executed by
Guarantor.

         NOW,  THEREFORE,  in consideration of the mutual promises,  conditions,
representations  and  warranties  hereinafter  set forth and for other  good and
valuable  considerations,  the  receipt  and  sufficiency  of which  are  hereby
acknowledged, the parties hereto have mutually agreed as follows:


                                        1

<PAGE>



         1. The definitions of "Borrower" and  "Co-Borrower"  are hereby amended
and are restated in their entireties as follows:

                  CARROLL  FULMER  &  COMPANY,   INC.,  a  Florida   corporation
                  ("Carroll Fulmer"), and CAROLINA PACIFIC DISTRIBUTORS, INC., a
                  North Carolina corporation  ("Carolina Pacific"),  and CAPITOL
                  WAREHOUSE, INC., a Kentucky corporation ("Capitol Warehouse"),
                  SERVICE  EXPRESS,   INC.,  an  Alabama  corporation  ("Service
                  Express"),   RAINBOW  TRUCKING  SERVICES,   INC.,  an  Indiana
                  corporation   ("Rainbow  Trucking")  and  any  and  all  other
                  subsidiaries  of Transit  Group,  Inc., a Florida  corporation
                  (together   herein   referred   to  as  the   "Subsidiaries"or
                  individually as the  "Subsidiary")  which  subsequently  enter
                  into a Joinder to Advised  Revolving Line of Credit  Agreement
                  and Joinder to Security  Agreement  (Carroll Fulmer,  Carolina
                  Pacific, Capitol Warehouse,  Service Express, Rainbow Trucking
                  and Subsidiaries are together  hereinafter  referred to as the
                  "Borrower" and  individually  referred to as a  "Co-Borrower";
                  references  applicable to Borrower shall also be applicable to
                  each Co-Borrower).

         2. Section 8.1 Events,  subparagraph (i), of the Advised Revolving Line
of Credit Agreement is hereby amended and restated in its entirety as follows:

                  "(i)     Corporate Existence.

                  Any act or omission  (formal or  informal)  of the Borrower or
Guarantor or its officers,  directors,  shareholders, or partners leading to, or
resulting  in, the  termination,  invalidation  (partial or total),  revocation,
suspension,  interruption, or unenforceability of its existence, or the transfer
or disposition  (whether by sale, lease, or otherwise) to any person of all or a
substantial part of its property; or"

         3. The Advised  Revolving Line of Credit Agreement is hereby amended by
adding Section 8.1 Events subparagraph (j) in its entirety as follows:

                  "(j)     Execution of Guaranty; Opinion of Counsel.

                  The  Board  of  Directors  of the  Guarantor  fails  to pass a
resolution   authorizing   the  execution  by  Guarantor  of  a  Continuing  and
Unconditional  Guaranty  in the form  attached  hereto as Exhibit  "A" (the "New
Guaranty")  which shall replace and supersede the Continuing  and  Unconditional
Guaranty  dated as of December  18,  1997,  and deliver  the New  Guaranty  duly
executed by Guarantor  and a certified  copy of such  resolution to Lender on or
before  March 15,  1998,  accompanied  by a  favorable  opinion of  counsel  for
Guarantor indicating that the corporate resolution has been properly executed by
the Guarantor and the execution and delivery of such  corporate  resolution  are
within its corporate powers and authorized,  in form and substance  satisfactory
to the Lender."


                                        2

<PAGE>



         4. Subsidiaries may join in this credit accommodation by:

                  a.       executing  and  delivering to Lender with the consent
                           of Lender the  Joinder to Advised  Revolving  Line of
                           Credit Agreement and Joinder to Security Agreement in
                           the form attached hereto as Exhibit "B"; and

                  b.       executing and  delivering to Lender an Allonge in the
                           form  attached  hereto as  Exhibit  "C"  whereas  the
                           Subsidiary becomes a Maker on the Note; and

                  c.       executing and delivering to Lender a UCC-1  Financing
                           Statement  perfecting the pledge of the  Subsidiary's
                           Collateral as security for the Note; and

                  d.       executing  and  delivering  to Lender a tax indemnity
                           agreement,  out-of-state closing affidavit, corporate
                           borrowing resolution,  certification  certificate and
                           other  documents or  affidavits as may be required by
                           Lender; and

                  e.       delivering  to  Lender  an  opinion  of  Subsidiary's
                           counsel in form and content satisfactory to Lender.

         5. Nothing herein  invalidates or shall impair or release any covenant,
condition,  agreement or stipulation in the Loan Agreement, and the same, except
as herein  modified,  shall  continue in full force and effect and the  Borrower
further  covenants  and agrees to perform  and comply with each and every of the
covenants,  agreements,  conditions and stipulations of the Loan Agreement which
are not inconsistent herewith.

         6. The Guarantor  joins in the  execution of this  Amendment to Advised
Revolving Line of Credit Agreement  ("Amendment") to specifically consent to the
terms  and  conditions  hereof  and to  reconfirm  its  guaranty  of  Borrower's
obligations under the Loan Agreement and Note.

         7. Except as herein  amended,  the Loan  Agreement  is confirmed in its
entirety.

         8.  In the  case  of  conflict  between  the  provisions  of  the  Loan
Agreement,  on the  one  hand,  and  this  Amendment,  on the  other  hand,  the
provisions of this Amendment shall prevail.

         9. This Amendment may be executed in any number of counterparts  and by
the parties hereto on separate counterparts,  each of which when so executed and
delivered shall be an original,  but all of which shall together  constitute one
and the same Amendment.


                                        3

<PAGE>



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

Signed, sealed and delivered             AMSOUTH BANK, a bank organized under
in the presence of:                      the laws of Alabama


                                         By: /s/ Anthony Stiffler
                                         Anthony Stiffler,
                                         Vice President

                                                  "Lender"


                                         CARROLL FULMER & COMPANY, INC.,
                                         a Florida corporation


                                         By: /s/ Philip A. Belyew
                                         Philip A. Belyew,
                                         Chairman of the Board


                                         CAROLINA PACIFIC DISTRIBUTORS, INC.,
                                         a North Carolina corporation


                                         By: /s/ Philip A. Belyew
                                         Philip A. Belyew,
                                         Chairman of the Board



                                         CAPITOL WAREHOUSE, INC., 
                                         a Kentucky corporation


                                         By: /s/ Philip A. Belyew
                                         Philip A. Belyew,
                                         Chairman of the Board




                                        4

<PAGE>


                                         SERVICE EXPRESS, INC., 
                                         an Alabama corporation


                                         By: /s/ Philip A. Belyew
                                         Philip A. Belyew,
                                         Chairman of the Board

                                                 "Borrower"


                                         TRANSIT GROUP, INC., 
                                         a Florida corporation


                                         By: /s/ Philip A. Belyew
                                         Philip A. Belyew,
                                         President and Chief Executive Officer
                                         
                                                 "Guarantor"




STATE OF GEORGIA

COUNTY OF ________________

         The foregoing  instrument was acknowledged  before me this _____ day of
January,  1998,  by Anthony  Stiffler as Vice  President of AmSouth Bank, a bank
organized  under the laws of Alabama,  on behalf of the bank.  He is  personally
known to me or has produced _______________________________ as identification.


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

                                         Notary Public
                                         My Commission Expires:


                                        5

<PAGE>

STATE OF GEORGIA

COUNTY OF ________________

         The foregoing  instrument was acknowledged  before me this _____ day of
January, 1998, by Philip A. Belyew, as Chairman of the Board of Carroll Fulmer &
Company,  Inc.,  a Florida  corporation,  on behalf  of the  corporation.  He is
personally  known  to  me or  has  produced  _______________________________  as
identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:


STATE OF GEORGIA

COUNTY OF _____________

         The foregoing  instrument was acknowledged  before me this _____ day of
January, 1998, by Philip A. Belyew, as Chairman of the Board of Carolina Pacific
Distributors,  Inc., a North Carolina corporation, on behalf of the corporation.
He is personally known to me or has produced  _______________________________ as
identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:



STATE OF GEORGIA

COUNTY OF _____________

         The foregoing  instrument was acknowledged  before me this _____ day of
January,  1998,  by Philip  A.  Belyew,  as  Chairman  of the  Board of  Capitol
Warehouse,  Inc., a Kentucky  corporation,  on behalf of the corporation.  He is
personally  known  to  me or  has  produced  _______________________________  as
identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:


                                        6
<PAGE>

STATE OF GEORGIA

COUNTY OF _____________

         The foregoing  instrument was acknowledged  before me this _____ day of
January, 1998, by Philip A. Belyew, as Chairman of the Board of Service Express,
Inc., an Alabama  corporation,  on behalf of the  corporation.  He is personally
known to me or has produced _______________________________ as identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:



STATE OF GEORGIA

COUNTY OF _____________

         The foregoing  instrument was acknowledged  before me this _____ day of
January,  1998, by Philip A. Belyew, as President and Chief Executive Officer of
Transit Group, Inc., a Florida corporation,  on behalf of the corporation. He is
personally  known  to  me or  has  produced  _______________________________  as
identification.


                                         ------------------------------------
                                         Notary Public
                                         My Commission Expires:




                                        7