<PAGE>

                                                                    Exhibit 10.6
Bank of America, N.A.

                                                          Date: December 9, 1999

                     CONTINUING AND UNCONDITIONAL GUARANTY

================================================================================
  Bank:                                   Guarantor:

  Bank of America, N.A.
  Banking Center:


     Commercial Lending                    USA LEASING, L.L.C.
     380 Knollwood Street                  104 CAMBRIDGE PLAZA DRIVE
     Winston-Salem, Forsyth Co., NC 27103  WINSTON-SALEM, FORSYTH CO., NC 27104





  (Street address including county)       (Name and street address, including
                                           county)
================================================================================

"Borrower": BLUE RHINO CORPORATION
           ---------------------------------------------------------------------
                                         (Borrower's Name)

1.   Guaranty. FOR VALUE RECEIVED, and to induce Bank of America, N.A. (Attn: J.
Thomas Johnson, Jr.) ("Bank") to make loans or advances or to extend credit or
other financial accommodations or benefits, with or without security, to or for
the account of Borrower, the undersigned "Guarantor", if more than one, then
each of them jointly and severally, hereby becomes surety for the irrevocably
and unconditionally guarantees to Bank the full and prompt payment when due,
whether by acceleration or otherwise, of any and all Liabilities of Borrower to
Bank. This Guaranty is continuing and unlimited as to the amount, and is
cumulative to and does not supersede any other guaranties.

Guarantor further unconditionally guarantees the faithful, prompt and complete
compliance by Borrower with all Obligations (as hereinafter defined). The
undertakings of Guarantor hereunder are independent of the Liabilities and
Obligations of Borrower and a separate action or actions for payment, damages or
performance may be brought or prosecuted against Guarantor, whether or not an
action is brought against Borrower or to realize upon the security for the
Liabilities and/or Obligations, whether or not Borrower is joined in any such
action or actions, and whether or not notice is given or demand is made upon
Borrower.

Bank shall not be required to proceed first against Borrower, or any other
person or entity, whether primarily or secondarily liable, or against any
collateral held by it, before resorting to Guarantor for payment, and Guarantor
shall not be entitled to assert as a defense to the enforceability of the
Guaranty any defense of Borrower with respect to any Liabilities or Obligations.

2.   Paragraph Headings, Governing Law and Binding Effect. Guarantor agrees that
the paragraph headings in this Guaranty are for convenience only and that they
will not limit any of the provisions of this Guaranty. Guarantor further agrees
that this Guaranty shall be governed by and construed in accordance with the
laws of the State of North Carolina and applicable United States federal law.
Guarantor further agrees that this Guaranty shall be deemed to have been made in
the State of North Carolina at Bank's address indicated above, and shall be
governed by, and construed in accordance with, the laws of the State of North
Carolina, or the United States courts located within the State of North
Carolina, and is performable in the State of North Carolina. This Guaranty is
binding upon Guarantor, his, their or its executors, administrators, successor
or assigns, and shall inure to the benefit of Bank, its successors, indorsees or
assigns. Anyone executing this Guaranty shall be bound by the terms hereof
without regard to execution by anyone else.

3.   Definitions.

     A. "Guarantor" shall mean Guarantor or any one or more of them.

     B. "Liability" or "Liabilities" shall mean without limitation, all
liabilities, overdrafts, indebtedness, and obligations of Borrower and/or
Guarantor to Bank, whether direct or indirect, absolute or contingent, joint or
several, secured or unsecured, due or not due, contractual or tortious,
liquidated or unliquidated, arising by operation of law or otherwise, now or
hereafter existing, or held or to be held by Bank for its own account or as
agent for another or others, whether created directly, indirectly, or acquired
by assignment or otherwise, including but not limited to all extensions or
renewals thereof, and all sums payable under or by virtue thereof, including
without limitation, all amounts of principal and interest, all expenses
(including reasonable attorney's fees and cost of collection) incurred in the
collection thereof or the enforcement of rights thereunder (including without
limitation, any liability arising from failure to comply with state or federal
laws, rules and regulations concerning the control of hazardous waste or
substances at or with respect to any real estate securing any loan guaranteed
hereby), whether arising in the ordinary course of business or otherwise. If
Borrower is a partnership, corporation or other entity the term "Liability" or
"Liabilities" as used herein shall include all Liabilities to Bank of any
successor entity or entities.

     C. "Loan Documents" shall mean all deeds in secure debt, deeds of trust,
mortgages, security agreements and other documents securing payment of the
Liabilities and all notes and other agreements, documents, and instruments
evidencing or relating to the Liabilities and Obligations.

     D. "Obligation" or "Obligations" shall mean all terms, conditions,
covenants, agreements and undertakings of Borrower and/or Guarantor under all
notes and other documents evidencing the Liabilities, and under all deeds to
secure debt, deeds of trust, mortgages, security agreements and other
agreements, documents and instruments executed in connection with the
Liabilities or related thereto.

4.   Waivers by Guarantor. Guarantor waives notice of acceptance of this
Guaranty, notice of any Liabilities or Obligations to which it may apply,
presentment, demand for payment, protest, notice of dishonor or nonpayment of
any liabilities, notice of intent to accelerate, notice of acceleration, and
notice of any suit or the taking of other action by Bank against Borrower,
Guarantor or any other person, any applicable statute of limitations and any
other notice to any party liable on any Loan Document (including Guarantor).

Each Guarantor also hereby waives any claim, right or remedy which such
Guarantor may now have or hereafter acquire against Borrower that arises
hereunder and/or from the performance by any other Guarantor hereunder
including, without limitation, any claim, remedy or right of subrogation,
reimbursement, exoneration, contribution, indemnification, or participation in
any claim, right or remedy of Bank against Borrower or against any security
which Bank now has or hereafter acquires, whether or not such claim, right or
remedy arises in equity, under contract, by statute, under common law or
otherwise.

Guarantor also waives the benefits of any provision of law requiring that Bank
exhaust any right or remedy, or take any action, against Borrower, any
Guarantor, any other person and/or property including but not limited to the
provisions of N.C. Gen. Stat. Sec. 26-7 through Sec. 26-9, inclusive as amended,
or otherwise.

Bank of America, N.A.                                                   Guaranty
North Carolina (Commercial)                -1-                              2/98

<PAGE>

Bank may at any time and from time to time (whether before or after revocation
or termination of this Guaranty) without notice to Guarantor (except as required
by law), without incurring responsibility to Guarantor, without impairing,
releasing or otherwise affecting the Obligations of Guarantor, in whole or in
part, and without the indorsement or execution by Guarantor of any additional
consent, waiver or guaranty: (a) change the manner, place or terms of payment,
or change or extend the time of or renew, or change any interest rate or alter
any Liability or Obligation or installment thereof, or any security therefor;
(b) loan additional monies or extend additional credit to Borrower, with or
without security, thereby creating new Liabilities or Obligations the payment or
performance of which shall be guaranteed hereunder, and the Guaranty herein made
shall apply to the Liabilities or Obligations as so changed, extended,
surrendered, realized upon or otherwise altered; (c) sell, exchange, release,
surrender, realize upon or otherwise deal with in any manner and in any order
any property at any time pledged or mortgaged to secure the Liabilities or
Obligations and any offset there against; (d) exercise or refrain from
exercising any rights against Borrower or others (including Guarantor) or act or
refrain from acting in any other manner; (e) settle or compromise any Liability
or Obligation or any security therefor and subordinate the payment of all or any
part thereof to the payment of any Liability or Obligation of any other parties
primarily or secondarily liable on any of the Liabilities or Obligations; (f)
release or compromise any Liability of Guarantor hereunder or any Liability or
Obligation of any other parties primarily or secondarily liable on any of the
Liabilities or Obligations; or (g) apply any sums from any sources to any
Liability without regard to any Liabilities remaining unpaid.

5.  Subordination. Upon demand of Bank, Guarantor agrees that it will not
demand, take or receive from Borrower, by set-off or in any other manner,
payment of any debt, now and at any time or times hereafter owing by Borrower to
Guarantor unless and until all the Liabilities and Obligations shall have been
fully paid and performed, and any security interest, liens or encumbrances which
Guarantor now has and from time to time hereafter may have upon any of the
assets of Borrower shall be made subordinate, junior and inferior and postponed
in priority, operation and effect to any security interest of Bank in such
assets.

6.  Waivers by Bank. No delay on the part of Bank in exercising any of its
options, powers or rights, and no partial or single exercise thereof, shall
constitute a waiver thereof. No waiver of any of its rights hereunder, and no
modification or amendment of this Guaranty, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; and each
such waiver, if any, shall apply only with respect to the specific instance
involved, and shall in no way impair the rights of Bank or the obligations of
Guarantor to Bank in any other respect at any other time.

7.  Termination. This Guaranty shall be binding on each Guarantor until written
notice of revocation signed by such Guarantor or written notice of the
dissolution of such Guarantor shall have been received by Bank, notwithstanding
change in name, location, composition or structure of, or the dissolution,
termination or increase, decrease or change in personnel, owners or partners of
Borrower, or any one or more of Guarantors. No notice of revocation or
termination hereof shall affect in any manner rights arising under this Guaranty
with respect to Liabilities or Obligations that shall have been committed,
created, contracted, assumed or incurred prior to receipt of such written notice
pursuant to any agreement entered into by Bank prior to receipt of such notice.
The sole effect of such notice of revocation or termination hereof shall be to
exclude from this Guaranty, Liabilities or Obligations thereafter arising that
are unconnected with Liabilities or Obligations theretofore arising or
transactions entered into theretofore.

8.  Partial invalidity and/or Enforceability of Guaranty. The unenforceability
or invalidity of any provision of this Guaranty shall not affect the
enforceability or validity of any other provision herein and the invalidity or
unenforceability of any provision of any Loan Document as it may apply to any
person or circumstance shall not affect the enforceability or validity of such
provision as it may apply to other persons or circumstances.

In the event Bank is required to relinquish or return the payments, the
collateral or the proceeds thereof, in whole or in part, which had been
previously applied to or retained for application against any Liability, by
reason of a proceeding arising under the Bankruptcy Code, or for any other
reason, this Guaranty shall automatically continue to be effective
notwithstanding any previous cancellation or release effected by Bank.

9.  Change of Status. Guarantor will not become a party to a merger or
consolidation with any other company, except where Guarantor is the surviving
corporation or entity, and all covenants under this Guaranty are assumed by the
surviving entity. Further, Guarantor may not change its legal structure, without
the written consent of Bank and all covenants under this Guaranty are assumed by
the new or surviving entity. Guarantor further agrees that this Guaranty shall
be binding, legal and enforceable against Guarantor in the event Borrower
changes its name, status or type of entity.

10. Financial and Other Information. Guarantor agrees to furnish to Bank any and
all financial information and any other information regarding Guarantor and/or
collateral requested in writing by Bank written ten (10) days of the date of the
request. Guarantor has made an independent investigation of the financial
condition and affairs of Borrower prior to entering into this Guaranty, and
Guarantor will continue to make such investigation; and in entering into this
Guaranty Guarantor has not relied upon any representation of Bank as to the
financial condition, operation or creditworthiness of Borrower. Guarantor
further agrees that Bank shall have no duty or responsibility now or hereafter
to make any investigation or appraisal of Borrower on behalf of Guarantor or to
provide Guarantor with any credit or other information which may come to its
attention now or hereafter.

11. Notices. Notice shall be deemed reasonable if mailed postage prepaid at
least five (5) days before the related action to the address of Guarantor or
Bank, at their respective addresses indicated at the beginning of this Guaranty,
or to such other address as any party may designate by written notice to the
other party. Each notice, request and demand shall be deemed given or made, if
sent by mail, upon the earlier of the date of receipt or five (5) days after
deposit in the U.S. Mail, first class postage prepaid, or if sent by any other
means, upon delivery.

12. Guarantor Duties. Guarantor shall upon notice or demand by Bank promptly and
with due diligence pay all Liabilities and perform and satisfy all Obligations
for the benefit of Bank in the event of (a) the occurrence of any default under
any Loan Documents; (b) the failure of any Borrower or Guarantor to perform any
obligation or pay any liability or indebtedness of any Borrower or Guarantor to
Bank, or to any affiliate of Bank, whether under any Note, Guaranty, or any
other agreement, now or hereafter existing, as and when due (whether upon
demand, at maturity or by acceleration); (c) the failure of any Borrower or
Guarantor to pay or perform any other liability, obligation or indebtedness of
any Borrower or Guarantor to any other party; (d) the death of any Borrower or
Guarantor (if an individual); (e) the resignation or withdrawal of any partner
or a material owner/Guarantor of Borrower, as determined by Bank in its sole
discretion; (f) the commencement of a proceeding against any Borrower or
Guarantor for dissolution or liquidation, the voluntary or involuntary
termination or dissolution of any Borrower or Guarantor or the merger or
consolidation of any Borrower or Guarantor with or into another entity; (g) the
insolvency, or the business failure of, or the appointment of a custodian,
trustee, liquidator or receive for or of any of the property of, or the
assignment for the benefit of creditors by, or the filing of a petition under
bankruptcy, insolvency or debtor's relief law or the filing of a petition for
any adjustment of indebtedness, composition or extension by or against any
Borrower or Guarantor; (h) the sole determination by Bank that any
representation or warranty to Bank in any Loan Document or otherwise to Bank was
untrue or materially misleading when made; (i) the failure of Guarantor or
Borrower to timely deliver such financial statements including tax returns and
all schedules, or other statements of condition or other information, as Bank
shall request from time to time; (j) the entry of a judgment against Borrower or
Guarantor which Bank deems to be of a material nature in the sole discretion of
Bank; (k) the seizure or forfeiture of any of Borrower or Guarantor's property,
or the issuance of any writ of possession, garnishment or attachment, or any
turnover order; (l) any lien or additional security interest being placed upon
any collateral which is security for any Loan Document; or (m) the failure of
Borrower's business to comply with any law or regulation controlling the
operation of Borrower's business, the failure to comply with which would result
in a material adverse effect on Borrower.

13. Remedies. Upon the failure of Guarantor to fulfill its duty to pay all
Liabilities and perform and satisfy all Obligations as required hereunder, Bank
shall have all of the remedies of a creditor and, to the extent applicable, of a
secured party, under all applicable law, and without limiting the generality of
the foregoing, Bank may, at its option and without notice or demand; (a) declare
any Liability due and payable at once; (b) take possession of any collateral
pledged by Borrower or Guarantor wherever located, and sell, resell, assign,
transfer and deliver all or any part of said collateral of Borrower or Guarantor
at any public or private sale or otherwise dispose of any or all of the
collateral in its then condition, for cash or on credit or for future delivery,
and in connection therewith Bank may impose reasonable conditions upon any such
sale, and Bank, unless prohibited by law the provisions of which cannot be
waived, may purchase all or any part of said collateral to be sold, free from
and discharged of all trusts, claims, rights or redemption and equities of
Borrower or Guarantor whatsoever; Guarantor acknowledges and agrees that the
sale of any collateral through any nationally recognized

Bank of America, N.A.                                                   Guaranty
North Carolina [Commercial]           -2-                                   2/96
<PAGE>

broker-dealer, investment banker or any other method common in the securities
industry shall be deemed a commercially reasonable sale under the Uniform
Commercial Code or any other equivalent statute or federal law, and expressly
waives notice thereof except as provided herein; and (c) set-off against any or
all liabilities of Guarantor all money owed by Bank or any of its agents or
affiliates in any capacity to Guarantor whether or not due, and also set-off
against all other Liabilities of Guarantor to Bank all money owed by Bank in
any capacity to Guarantor, and if exercised by Bank, Bank shall be deemed to
have exercised such right of set-off and to have made a charge against any such
money immediately upon the occurrence of such default although made or entered
on the books subsequent thereto.

Bank shall have a properly perfected security interest in all of Guarantor's
funds on deposit with Bank to secure the balance of any Liabilities and/or
Obligations that Guarantor may now or in the future owe Bank. Bank is granted a
contractual right of set-off and will not be liable for dishonoring checks or
withdrawals where the exercise of Bank's contractual right of set-off or
security interest results in insufficient funds in Guarantor's account. As
authorized by law, Guarantor grants to Bank this contractual right of set-off
and security in all property of Guarantor now or at anytime hereafter in the
possession of Bank, including but not limited to any joint account, special
account, account by the entireties, tenancy in common, and all dividends and
distributions now or hereafter in the possession or control of Bank.

14.  Attorney Fees, Cost and Expenses. Guarantor shall pay all costs of
collection and reasonable attorney's fees, including reasonable attorney's fees
in connection with any suit, mediation or arbitration proceeding, out of Court
payment agreement, trial, appeal, bankruptcy proceedings or otherwise, incurred
or paid by Bank in enforcing the payment of any Liability or defending this
agreement.

15.  Collateral.

[X] Check if applicable. Guarantor hereby pledges, assigns and grants to Bank a
security interest in and title to the collateral described in the security
agreement, deed of trust, deed to secure debt, mortgage or other collateral
instrument dated of even date herewith, which collateral, except for any margin
stock (as defined in Regulation U of the Board of Governors of the Federal
Reserve System), shall secure this Guaranty, whether currently existing or
arising in the future. Guarantor agrees to execute such security agreements,
financing statements and other documents as Bank may reasonably require or
request to obtain and perfect its security interest in said collateral.

16.  Preservation of Property. Bank shall not be bound to take any steps
necessary to preserve any rights in any property pledged as collateral to Bank
to secure Borrower and/or Guarantor's Liabilities and Obligations as against
prior parties who may be liable in connection therewith, and Borrower and
Guarantor hereby agree to take any such steps. Bank, nevertheless, at any time,
may (a) take any action it deems appropriate for the care or preservation of
such property or of any rights of Borrower and/or Guarantor or Bank therein; (b)
demand, sue for, collect or receive any money or property at any time due,
payable or receivable on account of or in exchange for any property pledged as
collateral to Bank to secure Borrower and/or Guarantor's Liabilities to Bank;
(c) compromise and settle with any person liable on such property; or (d) extend
the time of payment or otherwise change the terms of the Loan Documents as to
any party liable on the Loan Documents, all without notice to, without incurring
responsibility to, and without affecting any of the Obligations or Liabilities
of Guarantor.

17.  ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.

     A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE COUNTY OF ANY
BORROWER'S DOMICILE, OR IF THERE IS REAL OR PERSONAL PROPERTY COLLATERAL, IN THE
COUNTY WHERE SUCH REAL OR PERSONAL PROPERTY IS LOCATED AT THE TIME OF THE
EXECUTION OF THIS INSTRUMENT, AGREEMENT OR DOCUMENT AND ADMINISTERED BY J.A.M.S.
WHO WILL APPOINT AN ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM
ADMINISTERING THE ARBITRATION, THEN THE AMERICAN ARBITRATION ASSOCIATION WILL
SERVE. ALL ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS OF THE DEMAND
FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE
PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60
DAYS.

     B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.

18.  Controlling Document. To the extent that this Guaranty conflicts with or is
in any way incompatible with any other Loan Document concerning this Obligation,
any promissory note shall control over any other document, and if such
promissory note does not address an issue, then each other document shall
control to the extent that it deals most specifically with an issue.

19.  Execution Under Seal. This Guaranty is being executed under seal by
Guarantor.

20.  NOTICE OF FINAL AGREEMENT. THIS WRITTEN GUARANTY REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.



Bank of America, N.A.                                                   Guaranty
North Carolina [Commercial]           -3-                                   2/96

<PAGE>

IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be executed
under seal on this 9th day of December, 1999.

Witnessed By:                             Guarantor:

/s/ Mark Castaneda                     -----------------------------------(Seal)

/s/Mark Castaneda, CFU
----------------------------------     ------------------------------------
Print Name and Title                        Print Individual's Name


                                       Corporate or Partnership Guarantor:


                                       USA LEASING, L.L.C.          (SEAL)


                                       By: /s/ Billy D. Prim              (Seal)
                                          ---------------------------------
                                       Name:    Billy D. Prim
                                            -------------------------------
                                       Title:   Manager
                                             ------------------------------


Acknowledgment

State of North Carolina   )
                          )
County of Stokes          )

This instrument was acknowledged before me on December 9th, 1999, by Billy D.
                                                                     --------
Prim                 , of USA LEASING, LLC, a Delaware limited liability
---------------------
company, on behalf of said company.

[SEAL]   OFFICIAL SEAL
        LORETTA C. HALL
  Notary Public-North Carolina
        STOKES COUNTY
    My Commission Expires              /s/ Loretta C. Hall
          11/26/01                     --------------------------------------
                                       Notary Public
                                       in and for the State of North Carolina
                                                               --------------
November 26, 2001                      Loretta C. Hall
---------------------                  --------------------------------------
My Commission Expires                  Print Name of Notary




Bank of America, N.A.                                                   Guaranty
North Carolina (Commercial)              -4-                                2/96

<PAGE>
                                                                    Exhibit 10.3
Bank of America, N.A.

                                PROMISSORY NOTE

Date: DECEMBER 9th, 1999        [_] New  [X] Renewal       Amount $25,000,000.00

                                                  Maturity Date: AUGUST 31, 2001
================================================================================

Bank:                                       Borrower:

Bank of America, N.A.
Banking Center:

     Commercial Landing                     BLUE RHINO CORPORATION
     380 Knollwood Street                   104 CAMBRIDGE PLAZA DR.
     Winston-Salem, Forsyth Co., NC 27103   WINSTON-SALEM, FORSYTH CO., NC 27104


(Street address including county)    (Name and street address, including county)
================================================================================

FOR VALUE RECEIVED, the undersigned Borrower unconditionally (and jointly and
severally, if more than one) promises to pay to the order of Bank, its successor
and assigns, without setoff, at its offices indicated at the beginning of this
Note, or at such other place as may be designated by Bank, the principal amount
of UP TO TWENTY-FIVE MILLION AND NO/100 DOLLARS ($25,000,000.00), or so much
   -------------------------------------------------------------
thereof as may be advanced from time to time in immediately available funds,
together with interest computed daily on the outstanding principal balance
hereunder, at an annual interest rate, and in accordance with the payment
schedule, indicated below.

[This Note contains some provisions preceded by boxes. If a box is marked, the
provision applies to this transaction; if it is not marked, the provision does
not apply to this transaction.]

1.   Rate.

[_] Prime Rate.  The Rate shall be the Prime Rate, plus _____________ percent,
per annum. The "Prime Rate" is the fluctuating rate of interest established by
Bank from time to time, at its discretion, whether or not such rate shall be
otherwise published. The Prime Rate is established by Bank as an Index and may
or may not at any time be the best or lowest rate charged by Bank on any loan.

[_] Fixed Rate.  The Rate shall be fixed at _____________ percent per annum.

[X] Other.  The rate shall be thirty-day LIBOR, plus two hundred basis points
(2.00%) per annum, as such Rate is determined by the Bank and changes from time
to time.

Notwithstanding any provision of this Note, Bank does not intend to charge and
Borrower shall not be required to pay any amount of interest or other charges in
excess of the maximum permitted by the applicable law of the State of North
Carolina; if any higher rate calling is lawful, then that higher rate calling
shall apply. Any payment in excess of such maximum shall be refunded to Borrower
or credited against principal, at the option of Bank.

2.   Accrual Method.  Unless otherwise indicated, interest at the Rate set
forth above will be calculated  by the 365/360 day method (a daily amount of
interest is computed for a hypothetical year of 360 days; that amount is
multiplied by the actual number of days for which any principal is outstanding
hereunder). If interest is not to be computed using this method, the method
shall be: _____________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________.

3.   Rate Change Date.  Any Rate based on a fluctuating index or base rate will
change, unless otherwise provided, each time and as of the date that the index
or base rate changes. The Rate may also change in accordance with the interest
rate provisions of the Loan Agreement of even date herewith between the Borrower
and the Bank (the "Loan Agreement"). In the event any index is discontinued,
Bank shall substitute an index determined by Bank to be comparable, in its sole
discretion.

4.   Payment Schedule.  All payments received hereunder shall be applied first
to the payment of any expense or charges payable hereunder or under any other
loan documents executed in connection with this Note, then to interest due and
payable, with the balance applied to principal, or in such other order as Bank
shall determine at its option.

[_] Principal Plus Accrued Interest.  Principal shall be paid in consecutive
equal installments of $_____________, plus accrued interest payable [_] monthly,
[_] quarterly or [_]_____________________________, commencing on ______________,
19___, and continuing on the [_] same day, [_] last day of each successive
month, quarter or other period (as applicable) thereafter, with a final payment
of all unpaid principal and accrued interest due on _________________, 19___.

[_] Fixed Principal and Interest.  Principal and interest shall be paid in
consecutive equal installments of $_______________, payable [_] monthly, [_]
quarterly or [_] _______________________________, commencing on _____________,
19___, and continuing on the [_] same day, [_] last day of each successive
month, quarter or other period (as applicable) thereafter, with a final payment
of all unpaid principal and interest due thereon on _______________________,
19___. If, on any payment date, accrued interest exceeds the installment amount
set forth above, Borrower will also pay such excess as and when billed.

[X] Single Principal Payment.  Principal shall be paid in full in a single
payment on AUGUST 31, 2001. Interest thereon shall be paid [_] at maturity, or
else [X] monthly, [_] quarterly or [_] ________________________, commencing on
JANUARY 2, 2000, and continuing on the [X] same day, [_] last day of each
successive month, quarter or other period (as applicable) thereafter, with a
final payment of all unpaid interest at the stated maturity of this Note.

[X] Other.  This is the "Note" described in the Amended and Restated Loan
Agreement of even date herewith, to which reference is hereby made for
additional provisions affecting this Note.


Bank of America,                                                 Promissory Note
North Carolina (Commercial)              -1-                                2/96

<PAGE>

5.   Revolving Feature.

[X]  Borrower may borrow, repay and reborrow hereunder at any time, up to a
maximum aggregate amount outstanding at any one time equal to the principal
amount of this Note, provided that Borrower is not in default under any
provision of this Note, any other documents executed in connection with this
Note, or any other note or other loan documents now or hereafter executed in
connection with any other obligation of Borrower to Bank, and provided that the
borrowings hereunder do not exceed any borrowing base or other limitation on
borrowings by Borrower. Bank shall incur no liability for its refusal to advance
funds based upon its determination that any conditions of such further advances
have not been met. Bank records of the amounts borrowed from time to time shall
be conclusive proof thereof.

     [_]  Uncommitted Facility. Borrower acknowledges and agrees that,
     notwithstanding any provisions of this Note or any other documents executed
     in connection with this Note, Bank has no obligation to make any advance,
     and that all advances are at the sole discretion of Bank.

     [_]  Out-Of-Debt Period. For a period of at least __________ consecutive
     days during [_] each fiscal year, [_] any consecutive 12-month period,
     Borrower shall fully pay down the balance of this Note, so that no amount
     of principal or interest and no other obligation under this Note remains
     outstanding.

6.   Automatic Payment.

[_]  Borrower has selected to authorize Bank to effect payment of sums due under
this Note by means of debiting Borrower's account number ______________________.
This authorization shall not affect the obligation of Borrower to pay such sums
when due, without notice, if there are insufficient funds in such accounts to
make such payment in full on the due date thereof, or if Bank fails to debit the
account.

7.   Waivers, Consents and Covenants.   Borrower, any indorser or guarantor
hereof, or any other party hereto (individually an "Obligor" and collectively
"Obligors") and each of them jointly and severally: (a) waive presentment,
demand, protest, notice of demand, notice of intent to accelerate, notice of
acceleration of maturity, notice of protest, notice of nonpayment, notice of
dishonor, and any other notice required to be given under the law to any Obligor
in connection with the delivery, acceptance, performance, default or enforcement
of this Note, any indorsement or guaranty of this Note, or any other documents
executed in connection with this Note or any other note or other loan documents
now or hereafter executed in connection with any obligation of Borrower to Bank
(the "Loan Document"); (b) consent to all delays, extensions, renewals or other
modifications of this Note or the Loan Documents, or waivers of any term hereof
or of the Loan Documents, or release or discharge by Bank of any of Obligors, or
release, substitution or exchange of any security for the payment hereof, or the
failure to act on the part of Bank, or any indulgence shown by Bank (without
notice to or further assent from any of Obligors), and agree that no such
action, failure to act or failure to exercise any right or remedy by Bank shall
in any way affect or impair the obligations of any Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this Note,
under any indorsement or guaranty of this Note or under any of the Loan
Documents; and (c) agree to pay, on demand, all costs and expenses of collection
or defense of this Note or of any indorsement or guaranty hereof and/or the
enforcement or defense of Bank's rights with respect to, or the administration,
supervision, preservation, or protection of, or realization upon, any property
securing payment hereof, including, without limitation, reasonable attorney's
fees, including fees related to any suit, mediation or arbitration proceeding,
out of court payment agreement, trial, appeal, bankruptcy, proceedings or other
proceeding, in such amount as may be determined reasonable by any arbitrator or
court, whichever is applicable.

8.   Prepayments.  Prepayments may be made in whole or in part at any time on
any loan. All prepayments of principal shall be applied in the inverse order of
maturity, or in such other order as Bank shall determine in its sole discretion.

9.   Delinquency Charge.  To the extent permitted by law, a delinquency charge
may be imposed in an amount not to exceed four percent (4%) of the unpaid
portion of any payment that is more than fifteen days late. Unless the terms of
this Note call for repayment of the entire balance of this Note (both principal
and interest) in a single payment and not for installments of interest or
principal and interest, the 4% delinquency charge may be imposed not only with
respect to regular installments of principal or interest or principal and
interest, but also with respect, to any other payment in default under this Note
(other than a previous delinquency charge), including without limitation, a
single payment of principal due at the maturity of this Note. In the event any
installment, or portion thereof, is not paid in a timely manner, subsequent
payments will be applied first to the past due balance (which shall not include
any previous delinquency charges), specifically to the oldest maturing
installment, and a separate delinquency charge will be imposed for each payment
that becomes due until the default is cured.

10.  Events of Default.  The following are events of default hereunder: (a)
subject to the tolling of any applicable cure period, the failure to pay or
perform any obligation, liability or indebtedness of any Obligor to Bank, or to
any affiliate or subsidiary of Bank of America Corporation, whether under this
Note or any Loan Documents, as and when due (whether upon demand, at maturity or
by acceleration); (b) subject to the tolling of any applicable cure period, the
failure to pay or perform any other obligation, liability or indebtedness of any
Obligor to any other party; (c) the death of any Obligor (if an individual); (d)
the resignation or withdrawal of any partner or a material owner/guarantor of
Borrower, as determined by Bank in its sole discretion; (e) the commencement of
a proceeding against any Obligor for dissolution or liquidation, the voluntary
or involuntary termination or dissolution of any Obligor or the merger or
consolidation of any Obligor with or into another entity; (f) the insolvency of,
the business failure of, the appointment of a custodian, trustee, liquidator or
receiver for or for any of the property of, the assignment for the benefit of
creditors by, or the filing of a petition under bankruptcy, insolvency or
debtor's relief law or the filing of a petition for any adjustment of
indebtedness, composition or extension by or against any Obligor; (g) the
determination by Bank that any representation or warranty made to Bank by any
Obligor in any Loan Documents or otherwise is or was, when it was made, untrue
or materially misleading; (h) the entry of a judgment against any Obligor which
Bank deems to be of a material nature, in Bank's sole discretion; (i) the
seizure or forfeiture or, or the issuance of any writ of possession, garnishment
or attachment, or any turnover order for any property of any Obligor; or (j) the
failure of Borrower's business to comply with any law or regulation controlling
its operation, the failure to comply with which would result in a material
adverse effect on Borrower.

11.  Remedies upon Default. Whenever there is a default under this Note (a) the
entire balance outstanding hereunder and all other obligations of any Obligor to
Bank (however acquired or evidenced) shall, at the option of Bank, become
immediately due and payable and any obligation of Bank to permit further
borrowing under this Note shall immediately cease and terminate, and/or (b) to
the extent permitted by law, the Rate of Interest on the unpaid principal shall
be increased to 4% per annum in excess of the rate previously applicable to the
balance of unpaid principal hereunder (the "Default Rate"). The provisions
herein for a Default Rate and a delinquency charge shall not be deemed to extend
the time for any payment hereunder or to constitute a "grace period" giving
Obligors a right to cure any default. At Bank's option, any accrued and unpaid
interest, fees or charges may, for purposes of computing and accruing interest
on a daily basis after the due date of this Note or any installment thereof, be
deemed to be a part of the principal balance, and interest shall accrue on a
daily compounded basis after such date at the Default Rate provided in this Note
until the entire outstanding balance of principal and interest is paid in full.
Upon a default under this Note, Bank is hereby authorized at any time, at its
option and without notice or demand to set off and charge against any deposit
accounts of any Obligor (as well as any money, instruments, securities,
documents, chattel paper, credits, claims, demands, income and any other
property, rights and interests of any Obligor), which at any time shall come
into the possession or custody or under the control of Bank or any of its
agents, affiliates or correspondents, any and all obligations due hereunder.
Additionally, Bank shall have all rights and remedies available under each of
the Loan Documents, as well as all rights and remedies available at law or in
equity.

12.  Non-Waiver.  The failure at any time of Bank to exercise any of its options
or any other rights hereunder shall not constitute a waiver thereof, nor shall
it be a bar to the exercise of any of its options or rights at a later date. All
rights and remedies of Bank shall be cumulative and may be pursued singly,
successively or together, at the option of Bank. The acceptance by Bank of any
partial payment shall not constitute a waiver of any default or of any of Bank's
rights under this Note. No waiver of any of its rights hereunder, and no
modification or amendment of this Note, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; each such
waiver shall apply only with respect to the specific instance involved, and
shall in no way impair the rights of Bank or the obligations of Obligors to Bank
in any other respect at any other time.

                                      -2-
<PAGE>

13.  Applicable Law, Venue and Jurisdiction. This Note and the rights and
obligations of Borrower and Bank shall be governed by and interpreted in
accordance with the law of the State of North Carolina. In any litigation in
connection with or to enforce this Note or any Indorsement or guaranty of this
Note or any Loan Documents, Obligors, and each of them, irrevocably consent to
and confer personal jurisdiction on the courts of the State of North Carolina or
the United States located within the State of North Carolina and expressly waive
any objections as to venue in any such courts. Nothing contained herein shall,
however, prevent Bank from bringing any action or exercising any rights within
any other state or jurisdiction or from obtaining personal jurisdiction by any
other means available under applicable law.

14.  Partial Invalidity. The unenforceability or invalidity of any provision of
this Note shall not affect the enforceability or validity of any other provision
herein and the invalidity or unenforceability of any provision of this Note or
of the Loan Documents to any person or circumstance shall not affect the
enforceability or validity of such provision as it may apply to other persons or
circumstances.

15.  Binding Effect. This Note shall be binding upon and inure to the benefit of
Borrower, Obligors and Bank and their respective successors, assigns, heirs and
personal representatives, provided, however, that no obligations of Borrower or
Obligors hereunder can be assigned without prior written consent of Bank.

16.  Controlling Document. To the extent that this Note conflicts with or is in
any way incompatible with any other document related specifically to the loan
evidenced by this Note, this Note shall control over any other such document,
and if this Note does not address an issue, then each other such document shall
control to the extent that it deals most specifically with an issue.

17.  ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.

     A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE COUNTY OF ANY
BORROWER'S DOMICILE AT THE TIME OF THE EXECUTION OF THIS INSTRUMENT, AGREEMENT
OR DOCUMENT OR IF THERE IS REAL OR PERSONAL PROPERTY COLLATERAL, IN THE COUNTY
WHERE SUCH REAL OR PERSONAL PROPERTY IS LOCATED, AND ADMINISTERED BY J.A.M.S.
WHO WILL APPOINT AN ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM
ADMINISTERING THE ARBITRATION, THEN THE AMERICAN ARBITRATION ASSOCIATION WILL
SERVE. ALL ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS OF THE DEMAND
FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE
PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60
DAYS.

     B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER, BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSURE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT, NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.

Borrower represents to Bank that the proceeds of this loan are to be used
primarily for business, commercial or agricultural purposes. Borrower
acknowledges having read and understood, and agrees to be bound by, all terms
and conditions of this Note and hereby executes this Note under seal as of the
date here above written.

NOTICE OF FINAL AGREEMENT. THIS WRITTEN PROMISSORY NOTE REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN OR ORAL AGREEMENTS BETWEEN THE PARTIES.

Borrower                                   Corporate or Partnership Borrower

                                           BLUE RHINO CORPORATION
_____________________________(Seal)
                                               /s/ Billy D. Prim
___________________________________        By:___________________________(Seal)
Print Individual's Name                          Billy D. Prim
                                           Name:_______________________________
_____________________________(Seal)              Chairman and CEO
                                           Title:______________________________
___________________________________
Print Individual's Name                    ____________________________________
                                           Attest (If Applicable)

                                                   [Corporate Seal]





Bank of America                                                  Promissory Note
North Carolina [Commercial]              -3-                                2/96
<PAGE>

                                                                    Exhibit 10.4
Bank of America, N.A.

                                                          Date: December 9, 1999

                     CONTINUING AND UNCONDITIONAL GUARANTY

================================================================================
  Bank:                                   Guarantor:

  Bank of America, N.A.
  Banking Center:


     Commercial Lending                    CPD ASSOCIATES, INC.
     380 Knollwood Street                  104 CAMBRIDGE PLAZA DRIVE
     Winston-Salem, Forsyth Co., NC 27103  WINSTON-SALEM, FORSYTH CO., NC 27104





  (Street address including county)       (Name and street address, including
                                           county)
================================================================================

"Borrower": BLUE RHINO CORPORATION
           ---------------------------------------------------------------------
                                         (Borrower's Name)

1.   Guaranty. FOR VALUE RECEIVED, and to induce Bank of America, N.A. (Attn: J.
Thomas Johnson, Jr.) ("Bank") to make loans or advances or to extend credit or
other financial accommodations or benefits, with or without security, to or for
the account of Borrower, the undersigned "Guarantor", if more than one, then
each of them jointly and severally, hereby becomes surety for the irrevocably
and unconditionally guarantees to Bank the full and prompt payment when due,
whether by acceleration or otherwise, of any and all Liabilities of Borrower to
Bank. This Guaranty is continuing and unlimited as to the amount, and is
cumulative to and does not supersede any other guaranties.

Guarantor further unconditionally guarantees the faithful, prompt and complete
compliance by Borrower with all Obligations (as hereinafter defined). The
undertakings of Guarantor hereunder are independent of the Liabilities and
Obligations of Borrower and a separate action or actions for payment, damages or
performance may be brought or prosecuted against Guarantor, whether or not an
action is brought against Borrower or to realize upon the security for the
Liabilities and/or Obligations, whether or not Borrower is joined in any such
action or actions, and whether or not notice is given or demand is made upon
Borrower.

Bank shall not be required to proceed first against Borrower, or any other
person or entity, whether primarily or secondarily liable, or against any
collateral held by it, before resorting to Guarantor for payment, and Guarantor
shall not be entitled to assert as a defense to the enforceability of the
Guaranty any defense of Borrower with respect to any Liabilities or Obligations.

2.   Paragraph Headings, Governing Law and Binding Effect. Guarantor agrees that
the paragraph headings in this Guaranty are for convenience only and that they
will not limit any of the provisions of this Guaranty. Guarantor further agrees
that this Guaranty shall be governed by and construed in accordance with the
laws of the State of North Carolina and applicable United States federal law.
Guarantor further agrees that this Guaranty shall be deemed to have been made in
the State of North Carolina at Bank's address indicated above, and shall be
governed by, and construed in accordance with, the laws of the State of North
Carolina, or the United States courts located within the State of North
Carolina, and is performable in the State of North Carolina. This Guaranty is
binding upon Guarantor, his, their or its executors, administrators, successor
or assigns, and shall inure to the benefit of Bank, its successors, indorsees or
assigns. Anyone executing this Guaranty shall be bound by the terms hereof
without regard to execution by anyone else.

3.   Definitions.

     A. "Guarantor" shall mean Guarantor or any one or more of them.

     B. "Liability" or "Liabilities" shall mean without limitation, all
liabilities, overdrafts, indebtedness, and obligations of Borrower and/or
Guarantor to Bank, whether direct or indirect, absolute or contingent, joint or
several, secured or unsecured, due or not due, contractual or tortious,
liquidated or unliquidated, arising by operation of law or otherwise, now or
hereafter existing, or held or to be held by Bank for its own account or as
agent for another or others, whether created directly, indirectly, or acquired
by assignment or otherwise, including but not limited to all extensions or
renewals thereof, and all sums payable under or by virtue thereof, including
without limitation, all amounts of principal and interest, all expenses
(including reasonable attorney's fees and cost of collection) incurred in the
collection thereof or the enforcement of rights thereunder (including without
limitation, any liability arising from failure to comply with state or federal
laws, rules and regulations concerning the control of hazardous waste or
substances at or with respect to any real estate securing any loan guaranteed
hereby), whether arising in the ordinary course of business or otherwise. If
Borrower is a partnership, corporation or other entity the term "Liability" or
"Liabilities" as used herein shall include all Liabilities to Bank of any
successor entity or entities.

     C. "Loan Documents" shall mean all deeds in secure debt, deeds of trust,
mortgages, security agreements and other documents securing payment of the
Liabilities and all notes and other agreements, documents, and instruments
evidencing or relating to the Liabilities and Obligations.

     D. "Obligation" or "Obligations" shall mean all terms, conditions,
covenants, agreements and undertakings of Borrower and/or Guarantor under all
notes and other documents evidencing the Liabilities, and under all deeds to
secure debt, deeds of trust, mortgages, security agreements and other
agreements, documents and instruments executed in connection with the
Liabilities or related thereto.

4.   Waivers by Guarantor. Guarantor waives notice of acceptance of this
Guaranty, notice of any Liabilities or Obligations to which it may apply,
presentment, demand for payment, protest, notice of dishonor or nonpayment of
any Liabilities, notice of intent to accelerate, notice of acceleration, and
notice of any suit or the taking of other action by Bank against Borrower,
Guarantor or any other person, any applicable statute of limitations and any
other notice to any party liable on any Loan Document (including Guarantor).

Each Guarantor also hereby waives any claim, right or remedy which such
Guarantor may now have or hereafter acquire against Borrower that arises
hereunder and/or from the performance by any other Guarantor hereunder
including, without limitation, any claim, remedy or right of subrogation,
reimbursement, exoneration, contribution, indemnification, or participation in
any claim, right or remedy of Bank against Borrower or against any security
which Bank now has or hereafter acquires, whether or not such claim, right or
remedy arises in equity, under contract, by statute, under common law or
otherwise.

Guarantor also waives the benefits of any provision of law requiring that Bank
exhaust any right or remedy, or take any action, against Borrower, any
Guarantor, any other person and/or property including but not limited to the
provisions of N.C. Gen. Stat. Sec. 26-7 through Sec. 26-9, inclusive as amended,
or otherwise.

Bank of America, N.A.                                                   Guaranty
North Carolina (Commercial)                -1-                              2/98
<PAGE>

Bank may at any time and from time to time (whether before or after revocation
or termination of this Guaranty) without notice to Guarantor (except as required
by law), without incurring responsibility to Guarantor, without impairing,
releasing or otherwise affecting the Obligations of Guarantor, in whole or in
part, and without the indorsement or execution by Guarantor of any additional
consent, waiver or guaranty: (a) change the manner, place or terms of payment,
or change or extend the time of or renew, or change any interest rate or alter
any Liability or Obligation or installment thereof, or any security therefor;
(b) loan additional monies or extend additional credit to Borrower, with or
without security, thereby creating new Liabilities or Obligations the payment or
performance of which shall be guaranteed hereunder, and the Guaranty herein made
shall apply to the Liabilities or Obligations as so changed, extended,
surrendered, realized upon or otherwise altered; (c) sell, exchange, release,
surrender, realize upon or otherwise deal with in any manner and in any order
any property at any time pledged or mortgaged to secure the Liabilities or
Obligations and any offset there against; (d) exercise or refrain from
exercising any rights against Borrower or others (including Guarantor) or act or
refrain from acting in any other manner; (e) settle or compromise any Liability
or Obligation or any security therefor and subordinate the payment of all or any
part thereof to the payment of any Liability or Obligation of any other parties
primarily or secondarily liable on any of the Liabilities or Obligations; (f)
release or compromise any Liability of Guarantor hereunder or any Liability or
Obligation of any other parties primarily or secondarily liable on any of the
Liabilities or Obligations; or (g) apply any sums from any sources to any
Liability without regard to any Liabilities remaining unpaid.

5.  Subordination. Upon demand of Bank, Guarantor agrees that it will not
demand, take or receive from Borrower, by set-off or in any other manner,
payment of any debt, now and at any time or times hereafter owing by Borrower to
Guarantor unless and until all the Liabilities and Obligations shall have been
fully paid and performed, and any security interest, liens or encumbrances which
Guarantor now has and from time to time hereafter may have upon any of the
assets of Borrower shall be made subordinate, junior and inferior and postponed
in priority, operation and effect to any security interest of Bank in such
assets.

6.  Waivers by Bank. No delay on the part of Bank in exercising any of its
options, powers or rights, and no partial or single exercise thereof, shall
constitute a waiver thereof. No waiver of any of its rights hereunder, and no
modification or amendment of this Guaranty, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; and each
such waiver, if any, shall apply only with respect to the specific instance
involved, and shall in no way impair the rights of Bank or the obligations of
Guarantor to Bank in any other respect at any other time.

7.  Termination. This Guaranty shall be binding on each Guarantor until written
notice of revocation signed by such Guarantor or written notice of the
dissolution of such Guarantor shall have been received by Bank, notwithstanding
change in name, location, composition or structure of, or the dissolution,
termination or increase, decrease or change in personnel, owners or partners of
Borrower, or any one or more of Guarantors. No notice of revocation or
termination hereof shall affect in any manner rights arising under this Guaranty
with respect to Liabilities or Obligations that shall have been committed,
created, contracted, assumed or incurred prior to receipt of such written notice
pursuant to any agreement entered into by Bank prior to receipt of such notice.
The sole effect of such notice of revocation or termination hereof shall be to
exclude from this Guaranty, Liabilities or Obligations thereafter arising that
are unconnected with Liabilities or Obligations theretofore arising or
transactions entered into theretofore.

8.  Partial invalidity and/or Enforceability of Guaranty. The unenforceability
or invalidity of any provision of this Guaranty shall not affect the
enforceability or validity of any other provision herein and the invalidity or
unenforceability of any provision of any Loan Document as it may apply to any
person or circumstance shall not affect the enforceability or validity of such
provision as it may apply to other persons or circumstances.

In the event Bank is required to relinquish or return the payments, the
collateral or the proceeds thereof, in whole or in part, which had been
previously applied to or retained for application against any Liability, by
reason of a proceeding arising under the Bankruptcy Code, or for any other
reason, this Guaranty shall automatically continue to be effective
notwithstanding any previous cancellation or release effected by Bank.

9.  Change of Status. Guarantor will not become a party to a merger or
consolidation with any other company, except where Guarantor is the surviving
corporation or entity, and all covenants under this Guaranty are assumed by the
surviving entity. Further, Guarantor may not change its legal structure, without
the written consent of Bank and all covenants under this Guaranty are assumed by
the new or surviving entity. Guarantor further agrees that this Guaranty shall
be binding, legal and enforceable against Guarantor in the event Borrower
changes its name, status or type of entity.

10. Financial and Other Information. Guarantor agrees to furnish to Bank any and
all financial information and any other information regarding Guarantor and/or
collateral requested in writing by Bank written ten (10) days of the date of the
request. Guarantor has made an independent investigation of the financial
condition and affairs of Borrower prior to entering into this Guaranty, and
Guarantor will continue to make such investigation; and in entering into this
Guaranty Guarantor has not relied upon any representation of Bank as to the
financial condition, operation or creditworthiness of Borrower. Guarantor
further agrees that Bank shall have no duty or responsibility now or hereafter
to make any investigation or appraisal of Borrower on behalf of Guarantor or to
provide Guarantor with any credit or other information which may come to its
attention now or hereafter.

11. Notices. Notice shall be deemed reasonable if mailed postage prepaid at
least five (5) days before the related action to the address of Guarantor or
Bank, at their respective addresses indicated at the beginning of this Guaranty,
or to such other address as any party may designate by written notice to the
other party. Each notice, request and demand shall be deemed given or made, if
sent by mail, upon the earlier of the date of receipt or five (5) days after
deposit in the U.S. Mail, first class postage prepaid, or if sent by any other
means, upon delivery.

12. Guarantor Duties. Guarantor shall upon notice or demand by Bank promptly and
with due diligence pay all Liabilities and perform and satisfy all Obligations
for the benefit of Bank in the event of (a) the occurrence of any default under
any Loan Documents; (b) the failure of any Borrower or Guarantor to perform any
obligation or pay any liability or indebtedness of any Borrower or Guarantor to
Bank, or to any affiliate of Bank, whether under any Note, Guaranty, or any
other agreement, now or hereafter existing, as and when due (whether upon
demand, at maturity or by acceleration); (c) the failure of any Borrower or
Guarantor to pay or perform any other liability, obligation or indebtedness of
any Borrower or Guarantor to any other party; (d) the death of any Borrower or
Guarantor (if an individual); (e) the resignation or withdrawal of any partner
or a material owner/Guarantor of Borrower, as determined by Bank in its sole
discretion; (f) the commencement of a proceeding against any Borrower or
Guarantor for dissolution or liquidation, the voluntary or involuntary
termination or dissolution of any Borrower or Guarantor or the merger or
consolidation of any Borrower or Guarantor with or into another entity; (g) the
insolvency, or the business failure of, or the appointment of a custodian,
trustee, liquidator or receive for or of any of the property of, or the
assignment for the benefit of creditors by, or the filing of a petition under
bankruptcy, insolvency or debtor's relief law or the filing of a petition for
any adjustment of indebtedness, composition or extension by or against any
Borrower or Guarantor; (h) the sole determination by Bank that any
representation or warranty to Bank in any Loan Document or otherwise to Bank was
untrue or materially misleading when made; (i) the failure of Guarantor or
Borrower to timely deliver such financial statements including tax returns and
all schedules, or other statements of condition or other information, as Bank
shall request from time to time; (j) the entry of a judgment against Borrower or
Guarantor which Bank deems to be of a material nature in the sole discretion of
Bank; (k) the seizure or forfeiture of any of Borrower or Guarantor's property,
or the issuance of any writ of possession, garnishment or attachment, or any
turnover order; (l) any lien or additional security interest being placed upon
any collateral which is security for any Loan Document; or (m) the failure of
Borrower's business to comply with any law or regulation controlling the
operation of Borrower's business, the failure to comply with which would result
in a material adverse effect on Borrower.

13. Remedies. Upon the failure of Guarantor to fulfill its duty to pay all
Liabilities and perform and satisfy all Obligations as required hereunder, Bank
shall have all of the remedies of a creditor and, to the extent applicable, of a
secured party, under all applicable law, and without limiting the generality of
the foregoing, Bank may, at its option and without notice or demand; (a) declare
any Liability due and payable at once; (b) take possession of any collateral
pledged by Borrower or Guarantor wherever located, and sell, resell, assign,
transfer and deliver all or any part of said collateral of Borrower or Guarantor
at any public or private sale or otherwise dispose of any or all of the
collateral in its then condition, for cash or on credit or for future delivery,
and in connection therewith Bank may impose reasonable conditions upon any such
sale, and Bank, unless prohibited by law the provisions of which cannot be
waived, may purchase all or any part of said collateral to be sold, free from
and discharged of all trusts, claims, rights or redemption and equities of
Borrower or Guarantor whatsoever; Guarantor acknowledges and agrees that the
sale of any collateral through any nationally recognized

Bank of America, N.A.                                                   Guaranty
North Carolina [Commercial]           -2-                                   2/96
<PAGE>

broker-dealer, investment banker or any other method common in the securities
industry shall be deemed a commercially reasonable sale under the Uniform
Commercial Code or any other equivalent statute or federal law, and expressly
waives notice thereof except as provided herein; and (c) set-off against any or
all liabilities of Guarantor all money owed by Bank or any of its agents or
affiliates in any capacity to Guarantor whether or not due, and also set-off
against all other Liabilities of Guarantor to Bank all money owed by Bank in
any capacity to Guarantor, and if exercised by Bank, Bank shall be deemed to
have exercised such right of set-off and to have made a charge against any such
money immediately upon the occurrence of such default although made or entered
on the books subsequent thereto.

Bank shall have a properly perfected security interest in all of Guarantor's
funds on deposit with Bank to secure the balance of any Liabilities and/or
Obligations that Guarantor may now or in the future owe Bank. Bank is granted a
contractual right of set-off and will not be liable for dishonoring checks or
withdrawals where the exercise of Bank's contractual right of set-off or
security interest results in insufficient funds in Guarantor's account. As
authorized by law, Guarantor grants to Bank this contractual right of set-off
and security in all property of Guarantor now or at anytime hereafter in the
possession of Bank, including but not limited to any joint account, special
account, account by the entireties, tenancy in common, and all dividends and
distributions now or hereafter in the possession or control of Bank.

14.  Attorney Fees, Cost and Expenses. Guarantor shall pay all costs of
collection and reasonable attorney's fees, including reasonable attorney's fees
in connection with any suit, mediation or arbitration proceeding, out of Court
payment agreement, trial, appeal, bankruptcy proceedings or otherwise, incurred
or paid by Bank in enforcing the payment of any Liability or defending this
agreement.

15.  Collateral.

[ ] Check if applicable. Guarantor hereby pledges, assigns and grants to Bank a
security interest in and title to the collateral described in the security
agreement, deed of trust, deed to secure debt, mortgage or other collateral
instrument dated of even date herewith, which collateral, except for any margin
stock (as defined in Regulation U of the Board of Governors of the Federal
Reserve System), shall secure this Guaranty, whether currently existing or
arising in the future. Guarantor agrees to execute such security agreements,
financing statements and other documents as Bank may reasonably require or
request to obtain and perfect its security interest in said collateral.

16.  Preservation of Property. Bank shall not be bound to take any steps
necessary to preserve any rights in any property pledged as collateral to Bank
to secure Borrower and/or Guarantor's Liabilities and Obligations as against
prior parties who may be liable in connection therewith, and Borrower and
Guarantor hereby agree to take any such steps. Bank, nevertheless, at any time,
may (a) take any action it deems appropriate for the care or preservation of
such property or of any rights of Borrower and/or Guarantor or Bank therein; (b)
demand, sue for, collect or receive any money or property at any time due,
payable or receivable on account of or in exchange for any property pledged as
collateral to Bank to secure Borrower and/or Guarantor's Liabilities to Bank;
(c) compromise and settle with any person liable on such property; or (d) extend
the time of payment or otherwise change the terms of the Loan Documents as to
any party liable on the Loan Documents, all without notice to, without incurring
responsibility to, and without affecting any of the Obligations or Liabilities
of Guarantor.

17.  ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.

     A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE COUNTY OF ANY
        -------------
BORROWER'S DOMICILE, OR IF THERE IS REAL OR PERSONAL PROPERTY COLLATERAL, IN THE
COUNTY WHERE SUCH REAL OR PERSONAL PROPERTY IS LOCATED AT THE TIME OF THE
EXECUTION OF THIS INSTRUMENT, AGREEMENT OR DOCUMENT AND ADMINISTERED BY J.A.M.S.
WHO WILL APPOINT AN ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM
ADMINISTERING THE ARBITRATION, THEN THE AMERICAN ARBITRATION ASSOCIATION WILL
SERVE. ALL ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS OF THE DEMAND
FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE
PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60
DAYS.

     B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
        ---------------------
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.

18.  Controlling Document. To the extent that this Guaranty conflicts with or is
in any way incompatible with any other Loan Document concerning this Obligation,
any promissory note shall control over any other document, and if such
promissory note does not address an issue, then each other document shall
control to the extent that it deals most specifically with an issue.

19.  Execution Under Seal. This Guaranty is being executed under seal by
Guarantor.

20.  NOTICE OF FINAL AGREEMENT. THIS WRITTEN GUARANTY REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.



Bank of America, N.A.                                                   Guaranty
North Carolina [Commercial]           -3-                                   2/96

<PAGE>



IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be executed
under seal on this 9th day of December, 1999.

Witnessed By:                               Guarantor:

/s/ Lori Hall
----------------------------------     -----------------------------------(Seal)

Lori Hall, Administrative Asst.
----------------------------------     ------------------------------------
Print Name and Title                        Print Individual's Name


                                       Corporate or Partnership Guarantor:


                                       CPD ASSOCIATES, INC.


                                       By: /s/ Mark Castaneda             (Seal)
                                          ---------------------------------
                                       Name:    Mark Castaneda
                                            -------------------------------
                                       Title:   Vice President
                                             ------------------------------

                                       ------------------------------------
                                       Attest (if applicable)

                                                  [Corporate Seal]

Corporate Acknowledgment

State of North Carolina   )
                          )
County of Forsyth         )


This instrument was acknowledged before me on December 9th, 1999, by Mark
Castaneda, ________________ of CPD ASSOCIATES, INC., a Delaware corporation, on
behalf of said corporation.


[SEAL]   OFFICIAL SEAL                 /s/ Abbye R. Caudle
     ABBYE R. CAUDLE                   --------------------------------------
  Notary Public-North Carolina         Notary Public
        FORSYTH COUNTY                 in and for the State of North Carolina
    My Commission Expires
           9/26/04                     Abbye R. Caudle
                                       --------------------------------------
                                       Print Name of Notary

September 26, 2004
---------------------
My Commission Expires




Bank of America, N.A.                                                   Guaranty
North Carolina (Commercial)              -4-                                2/96
<PAGE>

                                                                    Exhibit 10.5
Bank of America, N.A.

                                                      Date: DECEMBER 9, 1999

                     CONTINUING AND UNCONDITIONAL GUARANTY

================================================================================
  Bank:                                   Guarantor:

  Bank of America, N.A.
  Banking Center:


     Commercial Lending                    RHINO SERVICES, L.L.C.
     380 Knollwood Street                  104 CAMBRIDGE PLAZA DRIVE
     Winston-Salem, Forsyth Co., NC 27103  WINSTON-SALEM, FORSYTH CO., NC 27104





  (Street address including county)       (Name and street address, including
                                           county)
================================================================================

"Borrower": BLUE RHINO CORPORATION
           ---------------------------------------------------------------------
                                         (Borrower's Name)

1.   Guaranty. FOR VALUE RECEIVED, and to induce Bank of America, N.A. (Attn: J.
Thomas Johnson, Jr.) ("Bank") to make loans or advances or to extend credit or
other financial accommodations or benefits, with or without security, to or for
the account of Borrower, the undersigned "Guarantor", if more than one, then
each of them jointly and severally, hereby becomes surety for the irrevocably
and unconditionally guarantees to Bank the full and prompt payment when due,
whether by acceleration or otherwise, of any and all Liabilities of Borrower to
Bank. This Guaranty is continuing and unlimited as to the amount, and is
cumulative to and does not supersede any other guaranties.

Guarantor further unconditionally guarantees the faithful, prompt and complete
compliance by Borrower with all Obligations (as hereinafter defined). The
undertakings of Guarantor hereunder are independent of the Liabilities and
Obligations of Borrower and a separate action or actions for payment, damages or
performance may be brought or prosecuted against Guarantor, whether or not an
action is brought against Borrower or to realize upon the security for the
Liabilities and/or Obligations, whether or not Borrower is joined in any such
action or actions, and whether or not notice is given or demand is made upon
Borrower.

Bank shall not be required to proceed first against Borrower, or any other
person or entity, whether primarily or secondarily liable, or against any
collateral held by it, before resorting to Guarantor for payment, and Guarantor
shall not be entitled to assert as a defense to the enforceability of the
Guaranty any defense of Borrower with respect to any Liabilities or Obligations.

2.   Paragraph Headings, Governing Law and Binding Effect. Guarantor agrees that
the paragraph headings in this Guaranty are for convenience only and that they
will not limit any of the provisions of this Guaranty. Guarantor further agrees
that this Guaranty shall be governed by and construed in accordance with the
laws of the State of North Carolina and applicable United States federal law.
Guarantor further agrees that this Guaranty shall be deemed to have been made in
the State of North Carolina at Bank's address indicated above, and shall be
governed by, and construed in accordance with, the laws of the State of North
Carolina, or the United States courts located within the State of North
Carolina, and is performable in the State of North Carolina. This Guaranty is
binding upon Guarantor, his, their or its executors, administrators, successor
or assigns, and shall inure to the benefit of Bank, its successors, indorsees or
assigns. Anyone executing this Guaranty shall be bound by the terms hereof
without regard to execution by anyone else.

3.   Definitions.

     A. "Guarantor" shall mean Guarantor or any one or more of them.

     B. "Liability" or "Liabilities" shall mean without limitation, all
liabilities, overdrafts, indebtedness, and obligations of Borrower and/or
Guarantor to Bank, whether direct or indirect, absolute or contingent, joint or
several, secured or unsecured, due or not due, contractual or tortious,
liquidated or unliquidated, arising by operation of law or otherwise, now or
hereafter existing, or held or to be held by Bank for its own account or as
agent for another or others, whether created directly, indirectly, or acquired
by assignment or otherwise, including but not limited to all extensions or
renewals thereof, and all sums payable under or by virtue thereof, including
without limitation, all amounts of principal and interest, all expenses
(including reasonable attorney's fees and cost of collection) incurred in the
collection thereof or the enforcement of rights thereunder (including without
limitation, any liability arising from failure to comply with state or federal
laws, rules and regulations concerning the control of hazardous waste or
substances at or with respect to any real estate securing any loan guaranteed
hereby), whether arising in the ordinary course of business or otherwise. If
Borrower is a partnership, corporation or other entity the term "Liability" or
"Liabilities" as used herein shall include all Liabilities to Bank of any
successor entity or entities.

     C. "Loan Documents" shall mean all deeds in secure debt, deeds of trust,
mortgages, security agreements and other documents securing payment of the
Liabilities and all notes and other agreements, documents, and instruments
evidencing or relating to the Liabilities and Obligations.

     D. "Obligation" or "Obligations" shall mean all terms, conditions,
covenants, agreements and undertakings of Borrower and/or Guarantor under all
notes and other documents evidencing the Liabilities, and under all deeds to
secure debt, deeds of trust, mortgages, security agreements and other
agreements, documents and instruments executed in connection with the
Liabilities or related thereto.

4.   Waivers by Guarantor. Guarantor waives notice of acceptance of this
Guaranty, notice of any Liabilities or Obligations to which it may apply,
presentment, demand for payment, protest, notice of dishonor or nonpayment of
any Liabilities, notice of intent to accelerate, notice of acceleration, and
notice of any suit or the taking of other action by Bank against Borrower,
Guarantor or any other person, any applicable statute of limitations and any
other notice to any party liable on any Loan Document (including Guarantor).

Each Guarantor also hereby waives any claim, right or remedy which such
Guarantor may now have or hereafter acquire against Borrower that arises
hereunder and/or from the performance by any other Guarantor hereunder
including, without limitation, any claim, remedy or right of subrogation,
reimbursement, exoneration, contribution, indemnification, or participation in
any claim, right or remedy of Bank against Borrower or against any security
which Bank now has or hereafter acquires, whether or not such claim, right or
remedy arises in equity, under contract, by statute, under common law or
otherwise.

Guarantor also waives the benefits of any provision of law requiring that Bank
exhaust any right or remedy, or take any action, against Borrower, any
Guarantor, any other person and/or property including but not limited to the
provisions of N.C. Gen. Stat. Sec. 26-7 through Sec. 26-9, inclusive as amended,
or otherwise.

Bank of America, N.A.                                                   Guaranty
North Carolina (Commercial)                -1-                              2/98

<PAGE>

Bank may at any time and from time to time (whether before or after revocation
or termination of this Guaranty) without notice to Guarantor (except as required
by law), without incurring responsibility to Guarantor, without impairing,
releasing or otherwise affecting the Obligations of Guarantor, in whole or in
part, and without the indorsement or execution by Guarantor of any additional
consent, waiver or guaranty: (a) change the manner, place or terms of payment,
or change or extend the time of or renew, or change any interest rate or alter
any Liability or Obligation or installment thereof, or any security therefor;
(b) loan additional monies or extend additional credit to Borrower, with or
without security, thereby creating new Liabilities or Obligations the payment or
performance of which shall be guaranteed hereunder, and the Guaranty herein made
shall apply to the Liabilities or Obligations as so changed, extended,
surrendered, realized upon or otherwise altered; (c) sell, exchange, release,
surrender, realize upon or otherwise deal with in any manner and in any order
any property at any time pledged or mortgaged to secure the Liabilities or
Obligations and any offset there against; (d) exercise or refrain from
exercising any rights against Borrower or others (including Guarantor) or act or
refrain from acting in any other manner; (e) settle or compromise any Liability
or Obligation or any security therefor and subordinate the payment of all or any
part thereof to the payment of any Liability or Obligation of any other parties
primarily or secondarily liable on any of the Liabilities or Obligations; (f)
release or compromise any Liability of Guarantor hereunder or any Liability or
Obligation of any other parties primarily or secondarily liable on any of the
Liabilities or Obligations; or (g) apply any sums from any sources to any
Liability without regard to any Liabilities remaining unpaid.

5.  Subordination. Upon demand of Bank, Guarantor agrees that it will not
demand, take or receive from Borrower, by set-off or in any other manner,
payment of any debt, now and at any time or times hereafter owing by Borrower to
Guarantor unless and until all the Liabilities and Obligations shall have been
fully paid and performed, and any security interest, liens or encumbrances which
Guarantor now has and from time to time hereafter may have upon any of the
assets of Borrower shall be made subordinate, junior and inferior and postponed
in priority, operation and effect to any security interest of Bank in such
assets.

6.  Waivers by Bank. No delay on the part of Bank in exercising any of its
options, powers or rights, and no partial or single exercise thereof, shall
constitute a waiver thereof. No waiver of any of its rights hereunder, and no
modification or amendment of this Guaranty, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; and each
such waiver, if any, shall apply only with respect to the specific instance
involved, and shall in no way impair the rights of Bank or the obligations of
Guarantor to Bank in any other respect at any other time.

7.  Termination. This Guaranty shall be binding on each Guarantor until written
notice of revocation signed by such Guarantor or written notice of the
dissolution of such Guarantor shall have been received by Bank, notwithstanding
change in name, location, composition or structure of, or the dissolution,
termination or increase, decrease or change in personnel, owners or partners of
Borrower, or any one or more of Guarantors. No notice of revocation or
termination hereof shall affect in any manner rights arising under this Guaranty
with respect to Liabilities or Obligations that shall have been committed,
created, contracted, assumed or incurred prior to receipt of such written notice
pursuant to any agreement entered into by Bank prior to receipt of such notice.
The sole effect of such notice of revocation or termination hereof shall be to
exclude from this Guaranty, Liabilities or Obligations thereafter arising that
are unconnected with Liabilities or Obligations theretofore arising or
transactions entered into theretofore.

8.  Partial invalidity and/or Enforceability of Guaranty. The unenforceability
or invalidity of any provision of this Guaranty shall not affect the
enforceability or validity of any other provision herein and the invalidity or
unenforceability of any provision of any Loan Document as it may apply to any
person or circumstance shall not affect the enforceability or validity of such
provision as it may apply to other persons or circumstances.

In the event Bank is required to relinquish or return the payments, the
collateral or the proceeds thereof, in whole or in part, which had been
previously applied to or retained for application against any Liability, by
reason of a proceeding arising under the Bankruptcy Code, or for any other
reason, this Guaranty shall automatically continue to be effective
notwithstanding any previous cancellation or release effected by Bank.

9.  Change of Status. Guarantor will not become a party to a merger or
consolidation with any other company, except where Guarantor is the surviving
corporation or entity, and all covenants under this Guaranty are assumed by the
surviving entity. Further, Guarantor may not change its legal structure, without
the written consent of Bank and all covenants under this Guaranty are assumed by
the new or surviving entity. Guarantor further agrees that this Guaranty shall
be binding, legal and enforceable against Guarantor in the event Borrower
changes its name, status or type of entity.

10. Financial and Other Information. Guarantor agrees to furnish to Bank any and
all financial information and any other information regarding Guarantor and/or
collateral requested in writing by Bank written ten (10) days of the date of the
request. Guarantor has made an independent investigation of the financial
condition and affairs of Borrower prior to entering into this Guaranty, and
Guarantor will continue to make such investigation; and in entering into this
Guaranty Guarantor has not relied upon any representation of Bank as to the
financial condition, operation or creditworthiness of Borrower. Guarantor
further agrees that Bank shall have no duty or responsibility now or hereafter
to make any investigation or appraisal of Borrower on behalf of Guarantor or to
provide Guarantor with any credit or other information which may come to its
attention now or hereafter.

11. Notices. Notice shall be deemed reasonable if mailed postage prepaid at
least five (5) days before the related action to the address of Guarantor or
Bank, at their respective addresses indicated at the beginning of this Guaranty,
or to such other address as any party may designate by written notice to the
other party. Each notice, request and demand shall be deemed given or made, if
sent by mail, upon the earlier of the date of receipt or five (5) days after
deposit in the U.S. Mail, first class postage prepaid, or if sent by any other
means, upon delivery.

12. Guarantor Duties. Guarantor shall upon notice or demand by Bank promptly and
with due diligence pay all Liabilities and perform and satisfy all Obligations
for the benefit of Bank in the event of (a) the occurrence of any default under
any Loan Documents; (b) the failure of any Borrower or Guarantor to perform any
obligation or pay any liability or indebtedness of any Borrower or Guarantor to
Bank, or to any affiliate of Bank, whether under any Note, Guaranty, or any
other agreement, now or hereafter existing, as and when due (whether upon
demand, at maturity or by acceleration); (c) the failure of any Borrower or
Guarantor to pay or perform any other liability, obligation or indebtedness of
any Borrower or Guarantor to any other party; (d) the death of any Borrower or
Guarantor (if an individual); (e) the resignation or withdrawal of any partner
or a material owner/Guarantor of Borrower, as determined by Bank in its sole
discretion; (f) the commencement of a proceeding against any Borrower or
Guarantor for dissolution or liquidation, the voluntary or involuntary
termination or dissolution of any Borrower or Guarantor or the merger or
consolidation of any Borrower or Guarantor with or into another entity; (g) the
insolvency, or the business failure of, or the appointment of a custodian,
trustee, liquidator or receive for or of any of the property of, or the
assignment for the benefit of creditors by, or the filing of a petition under
bankruptcy, insolvency or debtor's relief law or the filing of a petition for
any adjustment of indebtedness, composition or extension by or against any
Borrower or Guarantor; (h) the sole determination by Bank that any
representation or warranty to Bank in any Loan Document or otherwise to Bank was
untrue or materially misleading when made; (i) the failure of Guarantor or
Borrower to timely deliver such financial statements including tax returns and
all schedules, or other statements of condition or other information, as Bank
shall request from time to time; (j) the entry of a judgment against Borrower or
Guarantor which Bank deems to be of a material nature in the sole discretion of
Bank; (k) the seizure or forfeiture of any of Borrower or Guarantor's property,
or the issuance of any writ of possession, garnishment or attachment, or any
turnover order; (l) any lien or additional security interest being placed upon
any collateral which is security for any Loan Document; or (m) the failure of
Borrower's business to comply with any law or regulation controlling the
operation of Borrower's business, the failure to comply with which would result
in a material adverse effect on Borrower.

13. Remedies. Upon the failure of Guarantor to fulfill its duty to pay all
Liabilities and perform and satisfy all Obligations as required hereunder, Bank
shall have all of the remedies of a creditor and, to the extent applicable, of a
secured party, under all applicable law, and without limiting the generality of
the foregoing, Bank may, at its option and without notice or demand; (a) declare
any Liability due and payable at once; (b) take possession of any collateral
pledged by Borrower or Guarantor wherever located, and sell, resell, assign,
transfer and deliver all or any part of said collateral of Borrower or Guarantor
at any public or private sale or otherwise dispose of any or all of the
collateral in its then condition, for cash or on credit or for future delivery,
and in connection therewith Bank may impose reasonable conditions upon any such
sale, and Bank, unless prohibited by law the provisions of which cannot be
waived, may purchase all or any part of said collateral to be sold, free from
and discharged of all trusts, claims, rights or redemption and equities of
Borrower or Guarantor whatsoever; Guarantor acknowledges and agrees that the
sale of any collateral through any nationally recognized

Bank of America, N.A.                                                   Guaranty
North Carolina [Commercial]           -2-                                   2/96
<PAGE>

broker-dealer, investment banker or any other method common in the securities
industry shall be deemed a commercially reasonable sale under the Uniform
Commercial Code or any other equivalent statute or federal law, and expressly
waives notice thereof except as provided herein; and (c) set-off against any or
all liabilities of Guarantor all money owed by Bank or any of its agents or
affiliates in any capacity to Guarantor whether or not due, and also set-off
against all other Liabilities of Guarantor to Bank all money owed by Bank in
any capacity to Guarantor, and if exercised by Bank, Bank shall be deemed to
have exercised such right of set-off and to have made a charge against any such
money immediately upon the occurrence of such default although made or entered
on the books subsequent thereto.

Bank shall have a properly perfected security interest in all of Guarantor's
funds on deposit with Bank to secure the balance of any Liabilities and/or
Obligations that Guarantor may now or in the future owe Bank. Bank is granted a
contractual right of set-off and will not be liable for dishonoring checks or
withdrawals where the exercise of Bank's contractual right of set-off or
security interest results in insufficient funds in Guarantor's account. As
authorized by law, Guarantor grants to Bank this contractual right of set-off
and security in all property of Guarantor now or at anytime hereafter in the
possession of Bank, including but not limited to any joint account, special
account, account by the entireties, tenancy in common, and all dividends and
distributions now or hereafter in the possession or control of Bank.

14.  Attorney Fees, Cost and Expenses. Guarantor shall pay all costs of
collection and reasonable attorney's fees, including reasonable attorney's fees
in connection with any suit, mediation or arbitration proceeding, out of Court
payment agreement, trial, appeal, bankruptcy proceedings or otherwise, incurred
or paid by Bank in enforcing the payment of any Liability or defending this
agreement.

15.  Collateral.

[ ] Check if applicable. Guarantor hereby pledges, assigns and grants to Bank a
security interest in and title to the collateral described in the security
agreement, deed of trust, deed to secure debt, mortgage or other collateral
instrument dated of even date herewith, which collateral, except for any margin
stock (as defined in Regulation U of the Board of Governors of the Federal
Reserve System), shall secure this Guaranty, whether currently existing or
arising in the future. Guarantor agrees to execute such security agreements,
financing statements and other documents as Bank may reasonably require or
request to obtain and perfect its security interest in said collateral.

16.  Preservation of Property. Bank shall not be bound to take any steps
necessary to preserve any rights in any property pledged as collateral to Bank
to secure Borrower and/or Guarantor's Liabilities and Obligations as against
prior parties who may be liable in connection therewith, and Borrower and
Guarantor hereby agree to take any such steps. Bank, nevertheless, at any time,
may (a) take any action it deems appropriate for the care or preservation of
such property or of any rights of Borrower and/or Guarantor or Bank therein; (b)
demand, sue for, collect or receive any money or property at any time due,
payable or receivable on account of or in exchange for any property pledged as
collateral to Bank to secure Borrower and/or Guarantor's Liabilities to Bank;
(c) compromise and settle with any person liable on such property; or (d) extend
the time of payment or otherwise change the terms of the Loan Documents as to
any party liable on the Loan Documents, all without notice to, without incurring
responsibility to, and without affecting any of the Obligations or Liabilities
of Guarantor.

17.  ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.

     A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE COUNTY OF ANY
        -------------
BORROWER'S DOMICILE, OR IF THERE IS REAL OR PERSONAL PROPERTY COLLATERAL, IN THE
COUNTY WHERE SUCH REAL OR PERSONAL PROPERTY IS LOCATED AT THE TIME OF THE
EXECUTION OF THIS INSTRUMENT, AGREEMENT OR DOCUMENT AND ADMINISTERED BY J.A.M.S.
WHO WILL APPOINT AN ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM
ADMINISTERING THE ARBITRATION, THEN THE AMERICAN ARBITRATION ASSOCIATION WILL
SERVE. ALL ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS OF THE DEMAND
FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE
PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60
DAYS.

     B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
        ---------------------
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.

18.  Controlling Document. To the extent that this Guaranty conflicts with or is
in any way incompatible with any other Loan Document concerning this Obligation,
any promissory note shall control over any other document, and if such
promissory note does not address an issue, then each other document shall
control to the extent that it deals most specifically with an issue.

19.  Execution Under Seal. This Guaranty is being executed under seal by
Guarantor.

20.  NOTICE OF FINAL AGREEMENT. THIS WRITTEN GUARANTY REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.



Bank of America, N.A.                                                   Guaranty
North Carolina [Commercial]           -3-                                   2/96

<PAGE>


IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be executed
under seal on this 9th day of December, 1999.

Witnessed By:                             Guarantor:

/s/ Mark Castaneda
----------------------------------     -----------------------------------(Seal)

Vice President
----------------------------------     ------------------------------------
Print Name and Title                        Print Individual's Name


                                       Corporate or Partnership Guarantor:


                                       RHINO SERVICES, L.L.C.       (SEAL)


                                       By: /s/ Billy D. Prim              (Seal)
                                          ---------------------------------
                                       Name:    Billy D. Prim
                                            -------------------------------
                                       Title:   President
                                             ------------------------------


Acknowledgment

State of North Carolina   )
                          )
County of Stokes          )

This instrument was acknowledged before me on December 9th, 1999, by Billy D.
Prim,                                     of RHINO SERVICES, LLC, a Delaware
limited liability company, on behalf of said company.

[SEAL]   OFFICIAL SEAL                 /s/ Loretta C. Hall
        LORETTA C. HALL                --------------------------------------
  Notary Public-North Carolina         Notary Public
        STOKES COUNTY                  in and for the State of North Carolina
    My Commission Expires
          11/26/01                     Loretta C. Hall
                                       --------------------------------------
                                       Print Name of Notary

November 26, 2001
---------------------
My Commission Expires




Bank of America, N.A.                                                   Guaranty
North Carolina (Commercial)              -4-                                2/96