EXHIBIT 10.6

                                 LOAN AGREEMENT



FIRST UNION NATIONAL BANK
201 S. JEFFERSON STREET
Roanoke, Virginia  24011
(Hereinafter referred to as the "Bank")

OPTICAL CABLE CORPORATION
5290 CONCOURSE DRIVE
ROANOKE, VIRGINIA  24019
(Individually and collectively, "Borrower")


This Loan Agreement  ("Agreement") is entered into this 10th day of March, 1999,
by and between Bank and OPTICAL CABLE CORPORATION, a corporation organized under
the laws of the State of Virginia.

Borrower has applied to Bank for a loan or loans (individually and collectively,
the "Loan")  evidenced by one or more  promissory note (whether one or more, the
"Note:) as follows:

     *  Working   Capital  Line  of  Credit  -  in  the   principal   amount  of
     $10,000,000.00  which is  evidenced  by the  Promissory  Note of even  date
     herewith  (the "Line of Credit  Note"),  under which  Borrower  may borrow,
     repay, and reborrow,  from time to time, so long as the total  indebtedness
     outstanding at any one time does not exceed the principal amount.  The Loan
     proceeds are to be used by Borrower solely for financing  working  capital.
     Bank's  obligation  to advance or  readvance  under the Line of Credit Note
     shall terminate if Borrower is in Default under the Line of Credit Note.

     * Line of Credit/Sweep + - in the principal amount of  $5,000,000.00  which
     is evidenced by the  Promissory  Note of even date  herewith  (the "Line of
     Credit Note"), under which Borrower may borrow,  repay, and reborrow,  from
     time to time, so long as the total indebtedness outstanding at any one time
     does not exceed the principal  amount.  The Loan proceeds are to be used by
     Borrower solely for financing working capital. Bank's obligation to advance
     or readvance  under the Line of Credit Note shall  terminate if Borrower is
     in Default under the Line of Credit Note.

The  Agreement  also  amends and  restates in its  entirety  that  certain  Loan
Agreement dated April 25, 1997.

This  Agreement  applies  to the loan and all Loan  Documents.  The terms  "Loan
Documents"  and  "Obligations,"  as used in this  Agreement,  are defined in the
Note. The term "Borrower" shall include its Subsidiaries and Affiliates. As used
in this  Agreement as to Borrower,  "Subsidiary"  shall mean any  corporation of
which more than 50% of the issued and outstanding voting stock is owned directly
or indirectly by Borrower. As to Borrower, "Affiliate" shall have the meaning as
defined in 11 U.S.C.  ss. 101,  except that the term  "debtor'  therein shall be
substituted by term "Borrower" herein.

Relying upon the covenants, agreements, representations and warranties contained
in this  Agreement,  Bank is willing to extend credit to Borrower upon the terms
and subject to the conditions  set forth herein,  and Bank and Borrower agree as
follows:

REPRESENTATIONS.  Borrower  represents  that from the date of this Agreement and
until  final  payment  in full of the  Obligations:  ACCURATE  INFORMATION.  All
information now and hereafter furnished to Bank is and will be true, correct and
complete.  Any such information  relating to Borrower's financial condition will
accurately  reflect  Borrower's  financial  condition as of the date(s) thereof,
(including  all  contingent  liabilities  of every type,  and  Borrower  further
represents that its financial condition has not changed materially or


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adversely since the date(s) of such documents. AUTHORIZATION; NON-CONTRAVENTION.
The  execution,  delivery  and  performance  by Borrower and any  guarantor,  as
applicable,  of this  Agreement and other Loan  Documents to which it is a party
are within its power, have been duly authorized by all necessary action taken by
the duly authorized officers of Borrower and any guarantors and if necessary, by
making  appropriate  filings  with any  governmental  agency or unit and are the
legal,  binding,   valid  and  enforceable   obligations  of  Borrower  and  any
guarantors; and do not (i) contravene, or constitute (with or without the giving
of notice or lapse of time or both) a violation of any  provision of  applicable
law, a violation of the  organizational  documents of Borrower or any guarantor,
or a default under any agreement,  judgment,  injunction, order, decree or other
instrument binding upon or affecting  Borrower or any guarantor,  (ii) result in
the creation or  imposition  of any lien (other than the lien(s)  created by the
Loan Documents) on any of Borrower's or guarantor's  assets, or (iii) give cause
for the  acceleration  of any  obligations  of Borrower or any  guarantor to any
other creditor.  ASSET OWNERSHIP.  Borrower has good and marketable title to all
of the  properties  and assets  reflected  on the balance  sheets and  financial
statement supplied Bank by Borrower, and all such properties and assets are free
and clear of mortgages,  security deeds, pledges,  liens, charges, and all other
encumbrances,  except as  otherwise  disclosed  to Bank by  Borrower  in writing
("Permitted Liens"). To Borrower's knowledge,  no default has occurred under any
Permitted Liens and no claims or interest  adverse to Borrower's  present rights
in its properties and assets have arisen. DISCHARGE OF LIENS AND TAXES. Borrower
has duly  filed,  paid and/or  discharged  all taxes or other  claims  which may
become a lien on any of its  property or assets,  except to the extent that such
items are being  appropriately  contested in good faith and an adequate  reserve
for the payment thereof is being maintained. SUFFICIENCY OF CAPITAL. Borrower is
not, and after  consummation  of this  Agreement  and after giving effect to all
indebtedness incurred and liens created by Borrower in connection with the Loan,
will not be insolvent  within the meaning of 11 U.S.C.  ss. 101(32).  COMPLIANCE
WITH LAWS. Borrower is in compliance in all respects with all federal, state and
local laws,  rules and  regulations  applicable to its  properties,  operations,
business, and finances, including, without limitation, any federal or state laws
relating  to  liquor  (including  18  U.S.C.  ss.  3617 et  seq.)  or  narcotics
(including  21  U.S.C.  ss.  801 et seq.)  and/or  any  commercial  crimes;  all
applicable federal, state and local laws and regulations intended to protect the
environment; and the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), if applicable.  ORGANIZATION AND AUTHORITY. Each corporate or limited
liability  company Borrower and any guarantor,  as applicable,  is duly created,
validly  existing  and in good  standing  under  the  laws of the  state  of its
organization,  and  has  all  powers,  governmental  licenses,   authorizations,
consents and approvals  required to operate its business as now conducted.  Each
corporate or limited  liability  company Borrower and any guarantor,  if any, is
duly  qualified,  licensed  and in  good  standing  in each  jurisdiction  where
qualification  or  licensing  is required  by the nature of its  business or the
character and location of its property,  business or customers, and in which the
failure  to so  qualify or be  licensed,  as the case may be, in the  aggregate,
could  have a  material  adverse  effect on the  business,  financial  position,
results  of  operations,  properties  or  prospects  of  Borrower  or  any  such
guarantor.  NO LITIGATION.  There are no pending or threatened suits,  claims or
demands  against  Borrower or any guarantor that have not been disclosed to Bank
by Borrower in writing.

AFFIRMATIVE COVENANTS.  Borrower agrees that from the date of this Agreement and
until final  payment in full of the  Obligations,  unless  Bank shall  otherwise
consent in writing: BUSINESS CONTINUITY.  Borrower shall conduct its business in
substantially  the same  manner and  locations  as such  business is now and has
previously  been  conducted.  MAINTAIN  PROPERTIES.   Borrower  shall  maintain,
preserve  and keep its property in good repair,  working  order and  conditions,
making all needed  replacements,  additions  and  improvements  thereto,  to the
extent  allowed by this  Agreement.  ACCESS TO BOOKS & RECORDS.  Borrower  shall
allow Bank, or its agents,  during normal business  hours,  access to the books,
records and such other documents of Borrower as Bank shall  reasonably  require,
and allow Bank to make copies  thereof at Bank's  expense.  INSURANCE.  Borrower
shall maintain  adequate  insurance  coverage with respect to its properties and
business  against  loss or damage of the  kinds and in the  amounts  customarily
insured  against by companies of established  reputation  engaged in the same or
similar businesses including,  without limitation,  commercial general liability
insurance,   workmen's   compensation   insurance,   and  business  interruption
insurance,  and upon all Collateral (as defined in the Loan Documents)  securing
the Obligations, such insurance as specified in the Loan Documents; all acquired
in such amounts and from such companies as Bank may reasonably  require.  NOTICE
OF DEFAULT AND OTHER NOTICES.  (a) Notice of Default.  Borrower shall furnish to
Bank immediately upon becoming aware of the existence of


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any  condition  or event  which  constitutes  a Default  (as defined in the Loan
Documents)  or any event  which,  upon the  giving of notice or lapse of time or
both, may become a Default,  written notice  specifying the nature and period of
existence  thereof and the action  which  Borrower is taking or proposes to take
with respect thereto. (b) Other Notices.  Borrower shall promptly notify Bank in
writing of (i) any material  adverse  change in its  financial  condition or its
business;  (ii) any  default  under any  material  agreement,  contract or other
instrument to which it is a party or by which any of its  properties  are bound,
or any acceleration of the maturity of any indebtedness owed by Borrower;  (iii)
any material  adverse  claim against or affecting  Borrower;  or any part of its
properties;  (iv) the  commencement  of,  any  material  determination  in,  any
litigation with any third party or any proceeding before any governmental agency
or unit affecting Borrower; and (v) at least thirty (30) days prior thereto, any
change in  Borrower's  name or  address  as shown  above,  and/or  any change in
Borrower's  structure.  COMPLIANCE WITH OTHER AGREEMENTS.  Borrower shall comply
with all terms and conditions  contained in this  Agreement,  and any other Loan
Documents, and swap agreements,  if applicable, as defined in the Note. Payments
of Debts.  Borrower  shall pay and  discharge  when due,  and before  subject to
penalty or further charge, and otherwise satisfy before maturity or delinquency,
all  obligations,  debts,  taxes,  and liabilities of whatever nature or amount,
except  those  which  Borrower  in good faith  disputes.  REPORTS  AND  PROXIES.
Borrower shall deliver to Bank,  promptly,  a copy of all financial  statements,
reports, notices, and proxy statements sent by Borrower to stockholders, and all
regular  or  periodic  reports  required  to  be  filed  by  Borrower  with  any
governmental agency or authority.  Other Financial  Information.  Borrower shall
deliver  promptly  such other  information  regarding  the  operation,  business
affairs,  and financial condition of Borrower which Bank may reasonably request.
ESTOPPEL CERTIFICATE.  Borrower, within fifteen (15) days after request by Bank,
will furnish a written  statement duly  acknowledged of the amount due under the
Loan and whether  offsets or defenses  exist  against the  Obligations.  DEPOSIT
RELATIONSHIP.  Borrower will maintain its primary  depository  relationship with
Bank. LIFE INSURANCE.  Maintain no less than  $2,000,000.00 of life insurance on
Robert Kopstein.

NEGATIVE  COVENANTS.  Borrower  agrees that from the date of this  Agreement and
until final  payment in full of the  Obligations,  unless  Bank shall  otherwise
consent  in  writing:  GOVERNMENT  INTERVENTION.  Borrower  shall not permit the
assertion  or  making  of any  seizure,  vesting  or  intervention  by or  under
authority of any government by which the management of Borrower or any guarantor
is displaced of its authority in the conduct of its respective  business or such
business is curtailed or materially impaired. PREPAYMENT OF OTHER DEBT. Borrower
shall not  retire  any  long-term  debt  entered  into prior to the date of this
Agreement  at a date in advance  of its legal  obligation  to do so.  DEFAULT ON
OTHER  CONTRACTS  OR  OBLIGATIONS.  Borrower  shall not default on any  material
contract  with or  obligations  when  due to a third  party  or  default  in the
performance of any obligation to a third party incurred for money borrowed in an
amount in excess of $100,000.00. JUDGMENT ENTERED. Borrower shall not permit the
entry of any monetary judgment or the assessment against,  the filing of any tax
lien against,  or the issuance of any writ of garnishment or attachment  against
any property of or debts due Borrower in an amount in excess of  $50,000.00  and
that is not  discharged  or  execution  is not  stayed  within 30 days of entry.
CHANGE OF CONTROL.  Borrower shall not make a material  change of ownership that
effectively  changes  control  of  Borrower.  GUARANTEES.   Borrower  shall  not
guarantee or otherwise become responsible for obligations of any other person or
entity. ENCUMBRANCES.  Borrower shall not create, assume, or permit to exist any
mortgage,   security  deed,  deed  of  trust,  pledge,  lien,  change  or  other
encumbrance on any of its assets, whether now owned or hereafter acquired, other
than:  (i) security  interests  required by the Loan  Documents;  (ii) liens for
taxes  contested  in good  faith;  (iii)  liens  accruing  by law  for  employee
benefits; or (iv) Permitted Liens. RETIRE OR REPURCHASE CAPITAL STOCK. Retire or
otherwise  acquire its capital stock in an amount  greater than  $15,000,000.00.
Any such  acquisition  of capital stock may be paid for from working  capital or
other sources deemed appropriate by the officers of the corporation.

FINANCIAL REPORTS.  Borrower agrees to the following provisions(s) from the date
of this  Agreement  and until final payment in full of the  Obligations,  unless
Bank shall otherwise consent in writing:  ANNUAL FINANCIAL STATEMENTS.  Borrower
shall  deliver to Bank,  within 120 days  after the close of each  fiscal  year,
audited financial statements  reflecting its operations during such fiscal year,
including,  without  limitation,  a balance sheet, profit and loss statement and
statement of cash flows, with supporting  schedules;  all in reasonable  detail,
prepared in conformity with generally accepted accounting principles, applied on
a


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basis  consistent with that of the preceding year. All such statements  shall be
examined by an independent  certified public accountant  acceptable to Bank. The
opinion of such independent  certified public accountant shall not be acceptable
to Bank if qualified due to any  limitation  in scope  imposed by Borrower.  Any
other   qualification  of  the  opinion  by  the  accountant  shall  render  the
acceptability of the financial  statements subject to Bank's approval.  PERIODIC
FINANCIAL  STATEMENTS.  Borrower  shall  deliver  to  Bank  quarterly  unaudited
management-prepared  financial  statements,  including,  without  limitation,  a
balance  sheet,  profit and loss  statement,  and statement of cash flows,  with
supporting schedules, as soon as available and in any event within 60 days after
the close of each such period; all in reasonable  detail.  Such statements shall
be  certified  as to their  correctness  by a  principal  financial  officer  of
Borrower.

CONDITONS  PRECEDENT.  The obligations of Bank to make the Loan and any advances
pursuant to this  Agreement are subject to the following  conditions  precedent:
ADDITIONAL DOCUMENTS. Receipt by Bank of such additional supporting documents as
Bank or its counsel may reasonably request.

IN WITNESS  WHEREOF,  Borrower,  on the day and year first  written  above,  has
caused this Agreement to be executed under seal.


                                                     OPTICAL CABLE CORPORATION

Corporate                                            By: /s/ Robert Kopstein    
Seal                                                    ------------------------
                                                         Robert Kopstein
                                                         President


                       TAXPAYER IDENTIFICATION NUMBER(S):

                                            OPTICAL CABLE CORPORATION 54-1237042

                                                     FIRST UNION NATIONAL BANK

                                                     By: /s/ Susan Doyle
                                                        ------------------------
                                                         Susan Doyle
                                                         Senior Vice President

49548

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