<PAGE>


                                CREDIT AGREEMENT

                         dated as of September 25, 1996

                                      among

                        GIBRALTAR PACKAGING GROUP, INC.,

                         VARIOUS FINANCIAL INSTITUTIONS

                                       and

                         HARRIS TRUST AND SAVINGS BANK,
                            individually and as Agent










<PAGE>





                                TABLE OF CONTENTS






<TABLE>

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<S>                                                                                                             <C>


                                                                                                               Page

SECTION 1  DEFINITIONS..........................................................................................  1

           1.1          Definitions.............................................................................  2
           1.2          Other Definitional Provisions........................................................... 15

SECTION 2  COMMITMENTS OF THE BANKS; TYPES OF LOANS; LETTERS 
           OF CREDIT; BORROWING AND CONVERSION PROCEDURES....................................................... 15
           2.1  Commitments..................................................................................... 15
           2.2  Various Types of Loans.......................................................................... 16
           2.3  Borrowing Procedures............................................................................ 16
           2.4  Procedures for Conversion of Type of Loan....................................................... 17
           2.5  Letter of Credit Procedures..................................................................... 17
           2.6  Participations in Letters of Credit............................................................. 17
           2.7  Reimbursement Obligations....................................................................... 18
           2.8  Limitation on Harris's Obligations.............................................................. 18
           2.9  Funding by Banks to Harris...................................................................... 18
           2.10  Warranty....................................................................................... 19
           2.11  Conditions..................................................................................... 19
           2.12  Commitments Several............................................................................ 20

SECTION 3  NOTES EVIDENCING LOANS............................................................................... 20
           3.1  Notes........................................................................................... 20
           3.2  Recordkeeping................................................................................... 20

SECTION 4  INTEREST............................................................................................. 21
           4.1  Interest Rates.................................................................................. 21
           4.2  Interest Payment Dates.......................................................................... 21
           4.3  Interest Periods................................................................................ 21
           4.4  Setting and Notice of Eurodollar Rates.......................................................... 22
           4.5  Computation of Interest......................................................................... 22

SECTION 5  FEES................................................................................................. 23
           5.1  Non-Use Fee..................................................................................... 23
           5.2  Letter of Credit Fees........................................................................... 23
           5.3  Agent's Fees.................................................................................... 23

SECTION 6  REDUCTION OR TERMINATION OF THE COMMITMENTS; PREPAYMENTS............................................. 24
           6.1  Reduction or Termination of the Commitments..................................................... 24
                        6.1.1  Termination of Term Commitments.................................................. 24
                        6.1.2  Voluntary Reduction or Termination of Commitments................................ 24
                        6.1.3  Reductions Pro Rata.............................................................. 24
           6.2  Prepayments..................................................................................... 24
                        6.2.1  Mandatory Prepayments............................................................ 24
                        6.2.2  Voluntary Prepayments............................................................ 25




<PAGE>



SECTION 7  MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES...................................................... 25
           7.1  Making of Payments.............................................................................. 25
           7.2  Application of Certain Payments................................................................. 25
           7.3  Due Date Extension.............................................................................. 26
           7.4  Setoff.......................................................................................... 26
           7.5  Proration of Payments........................................................................... 26

SECTION 8  INCREASED COSTS; SPECIAL PROVISIONS FOR EURODOLLAR LOANS............................................. 27
           8.1  Increased Costs................................................................................. 27
           8.2  Basis for Determining Interest Rate Inadequate or Unfair........................................ 28
           8.3  Changes in Law Rendering Eurodollar Loans Unlawful.............................................. 29
           8.4  Funding Losses.................................................................................. 29
           8.5  Right of Banks to Fund through Other Offices.................................................... 30
           8.6  Discretion of Banks as to Manner of Funding..................................................... 30
           8.7  Conclusiveness of Statements; Survival of Provisions............................................ 30

SECTION 9  WARRANTIES........................................................................................... 30
           9.1  Organization, etc............................................................................... 30
           9.2  Authorization; No Conflict...................................................................... 31
           9.3  Validity and Binding Nature..................................................................... 31
           9.4  Financial Information........................................................................... 31
           9.5  No Material Adverse Change...................................................................... 32
           9.6  Litigation and Contingent Liabilities........................................................... 32
           9.7  Ownership of Properties; Liens.................................................................. 32
           9.8  Subsidiaries.................................................................................... 32
           9.9  Pension and Welfare Plans....................................................................... 32
           9.10 Investment Company Act.......................................................................... 33
           9.11 Public Utility Holding Company Act.............................................................. 33
           9.12 Regulation U.................................................................................... 33
           9.13 Taxes........................................................................................... 33
           9.14 Solvency, etc................................................................................... 33
           9.15 Environmental Warranties........................................................................ 33
           9.16 Information..................................................................................... 34

SECTION 10  COVENANTS........................................................................................... 32
           10.1  Reports, Certificates and Other Information.................................................... 32
                        10.1.1  Audit Report.................................................................... 32
                        10.1.2  Quarterly Reports............................................................... 33
                        10.1.3  Monthly Reports................................................................. 33
                        10.1.4  Borrowing Base Certificate...................................................... 34
                        10.1.5  Compliance Certificates......................................................... 34
                        10.1.6  Reports to SEC and to Shareholders.............................................. 34
                        10.1.7  Notice of Default, Litigation and





                                      -ii-
<PAGE>




                                ERISA Matters................................................................... 37
                        10.1.8  Subsidiaries.................................................................... 37
                        10.1.9  Management Reports.............................................................. 37
                        10.1.10  Other Information.............................................................. 38
           10.2  Books, Records and Inspections................................................................. 38
           10.3  Insurance...................................................................................... 38
           10.4  Compliance with Laws; Payment of Taxes and Liabilities......................................... 38
           10.5  Maintenance of Existence, etc.................................................................. 39
           10.6  Financial Covenants............................................................................ 39
                        10.6.1  Minimum Net Worth............................................................... 39
                        10.6.2  Minimum Interest Coverage....................................................... 39
                        10.6.3  Debt Ratio...................................................................... 39
           10.7  Liens.......................................................................................... 39
           10.8  Limitations on Debt............................................................................ 40
           10.9  Guaranties..................................................................................... 40
           10.10  Mergers and Consolidations; Acquisitions...................................................... 41
           10.11  Asset Dispositions............................................................................ 41
           10.12  Capital Expenditures.......................................................................... 41
           10.13  Restricted Payments........................................................................... 42
           10.14  Modification of Organizational Documents...................................................... 42
           10.15  Use of Proceeds............................................................................... 42
           10.16  Further Assurances............................................................................ 42
           10.17  Transactions with Affiliates.................................................................. 43
           10.18  Employee Benefit Plans........................................................................ 43
           10.19  Lease Rentals................................................................................. 43
           10.20  Environmental Covenants....................................................................... 43
                        10.20.1  Environmental Response Obligation.............................................. 43
                        10.20.2  Environmental Liabilities...................................................... 44
           10.21  Unconditional Purchase Obligations............................................................ 44
           10.22  Maintenance of Properties..................................................................... 44
           10.23  Investments................................................................................... 44
           10.24  Interest Rate Protection...................................................................... 45
           10.25  Hedging Agreements............................................................................ 45
           10.26  Other Agreements.............................................................................. 45

SECTION 11  CONDITIONS TO EFFECTIVENESS; CONDITIONS OF
                                   LENDING...................................................................... 45
           11.1  Effective Date................................................................................. 45
                        11.1.1  Notes........................................................................... 45
                        11.1.2  Resolutions..................................................................... 46
                        11.1.3  Consents, etc................................................................... 46
                        11.1.4  Incumbency and Signature Certificates........................................... 46
                        11.1.5  Guaranty........................................................................ 46
                        11.1.6  Security Agreement.............................................................. 46
                        11.1.7  Pledge Agreements............................................................... 46
                        11.1.8  Mortgages....................................................................... 47
                        11.1.9  Evidence of the Payment of Debt to be






                                     -iii-
<PAGE>






                                 Repaid; Releases............................................................... 47
                        11.1.10  Insurance Certificate.......................................................... 47
                        11.1.11  Opinions of Counsel for the Company and the Guarantors......................... 47
                        11.1.12  Other.......................................................................... 47
           11.2  All Loans and Letters of Credit................................................................ 47
                        11.2.1  No Default, etc................................................................. 47
                        11.2.2  Confirmatory Certificate........................................................ 48

SECTION 12  EVENTS OF DEFAULT AND THEIR EFFECT.................................................................. 48
           12.1  Events of Default.............................................................................. 48
                        12.1.1  Non-Payment of the Loans, etc................................................... 48
                        12.1.2  Non-Payment of Other Debt....................................................... 48
                        12.1.3  Other Material Obligations...................................................... 48
                        12.1.4  Bankruptcy, Insolvency, etc..................................................... 49
                        12.1.5  Non-Compliance with Provisions of This Agreement................................ 49
                        12.1.6  Warranties...................................................................... 49
                        12.1.7  Pension Plans................................................................... 50
                        12.1.8  Judgments....................................................................... 50
                        12.1.9  Invalidity of Guaranty, etc..................................................... 50
                        12.1.10  Invalidity of Collateral Documents, etc........................................ 50
                        12.1.11  Change of Control.............................................................. 50
           12.2  Effect of Event of Default..................................................................... 50

SECTION 13  THE AGENT........................................................................................... 51
           13.1  Authorization.................................................................................. 51
           13.2  Indemnification................................................................................ 51
           13.3  Exculpation.................................................................................... 52
           13.4  Credit Investigation........................................................................... 52
           13.5  Agent and Affiliates........................................................................... 52
           13.6  Action on Instructions of the Required Banks................................................... 53
           13.7  Funding Reliance............................................................................... 53
           13.8  Resignation.................................................................................... 54

SECTION 14  GENERAL............................................................................................. 54
           14.1  Waiver; Amendments............................................................................. 54
           14.2  Confirmations.................................................................................. 55
           14.3  Notices........................................................................................ 55
           14.4  Computations................................................................................... 55
           14.5  Regulation U................................................................................... 55
           14.6  Costs, Expenses and Taxes...................................................................... 55
           14.7  Subsidiary References.......................................................................... 56
           14.8  Captions....................................................................................... 56
           14.9  Assignments; Participations.................................................................... 56
                        14.9.1  Assignments..................................................................... 56
                        14.9.2  Participations.................................................................. 58




                                      -iv-

<PAGE>




           14.10  Governing Law................................................................................. 59
           14.11  Counterparts.................................................................................. 59
           14.12  Successors and Assigns........................................................................ 59
           14.13  Indemnification by the Company................................................................ 60
           14.14  Forum Selection and Consent to Jurisdiction................................................... 60
           14.15  Waiver of Jury Trial.......................................................................... 61
           14.16  References to Banks and Agents................................................................ 61

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                                      -v-





<PAGE>


      SCHEDULE I                 Commitments and Percentages
         EXHIBIT A-1                Form of Revolving Note (Section 3.1(a))
         EXHIBIT A-2                Form of Term Note (Section 3.1(b))
         EXHIBIT B                  Litigation and Contingent Liabilities
                                      (Section 9.6)
         EXHIBIT C                  Subsidiaries (Section 9.8)
         EXHIBIT D                  Welfare Plans (Section 9.9)
         EXHIBIT E                  Environmental Compliance (Section 9.15)
         EXHIBIT F                  Form of Compliance Certificate
                                      (Section 10.1.5)
         EXHIBIT G                  Liens (Section 10.7)
         EXHIBIT H                  Debt (Section 10.8)
         EXHIBIT I-1                Form of Opinion
                                      (Section 11.1.11(a))
         EXHIBIT I-2                Form of Opinion
                                      (Section 11.1.11(b))
         EXHIBIT I-3                Form of Opinion
                                      (Section 11.1.11(c))
         EXHIBIT I-4                Form of Opinion
                                      (Section 11.1.11(d))
         EXHIBIT I-5                Form of Opinion

         EXHIBIT J                  Form of Assignment Agreement
                                      (Section 14.9)
         EXHIBIT K                  Form of Guaranty
                                      (Section 11.1.5)
         EXHIBIT L                  Form of Borrowing Base Certificate
                                      (Section 10.1.4)
         EXHIBIT M                  Form of Security Agreement
                                      (Section 11.1.6)
         EXHIBIT N-1                Form of Company Pledge Agreement
                                      (Section 11.1.7(a))

         EXHIBIT N-2                Form of Subsidiary Pledge Agreement
                                      (Section 11.1.7(b))

         EXHIBIT O                  List of Mortgaged Property
                                      (Section 11.1.8)

         EXHIBIT P                  Investments (Section 10.23)

         EXHIBIT Q                  Material Changes (Section 9.5)



                                      -vi-


<PAGE>





                                CREDIT AGREEMENT


         This CREDIT AGREEMENT dated as of September 25, 1996 (as amended or
otherwise modified from time to time, this "Agreement") is entered into among
GIBRALTAR PACKAGING GROUP, INC., a Delaware corporation (the "Company"), the
undersigned financial institutions (together with their respective successors
and assigns, collectively the "Banks" and individually each a "Bank") and HARRIS
TRUST AND SAVINGS BANK (in its individual capacity, "Harris"), as agent for the
Banks.



         In consideration of the premises and the mutual agreements herein
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:


SECTION 1  DEFINITIONS.

         1.1 Definitions. When used herein the following terms shall have the
following meaning (such definitions to be applicable to both the singular and
plural forms of such terms):

         Account Debtor means the party who is obligated on or under any
Receivable.

         Affected Loan - see Section 8.3.

         Affiliate of any Person means any other Person which, directly or
indirectly, controls or is controlled by or is under common control with such
Person. For purposes of the definition of Affiliate, "control" means the
possession directly or indirectly of the power to direct or cause the direction
of the management and policies of a Person, whether through ownership of voting
securities, by contract, or otherwise; it being understood that Rostra
Technologies, Inc. and its Subsidiaries shall not be deemed to be Affiliates of
the Company for purposes of this Agreement.

         Agent means Harris in its capacity as agent for the Banks hereunder and
any successor thereto in such capacity.

         Agreement - see the Preamble.

         Alternate Reference Rate means at any time the greater of (a) the
Federal Funds Rate plus 1/2 of 1% and (b) the rate per annum then most recently
announced by Harris as its prime rate at Chicago, Illinois.




<PAGE>


         Assignee - see Section 14.9.1.

         Assignment Agreement - see Section 14.9.1.

         Bank - see the Preamble.

         Borrowing Base means an amount equal to the sum of (i) 85% of the
amount of all Eligible Receivables plus (ii) 60% of the amount, based on the
lower of cost or market value, of all Eligible Inventory consisting of raw
materials plus (iii) 50% of the amount, based on the lower of cost or market
value, of all Eligible Inventory consisting of finished goods.

         Business Day means any day on which Harris is open for commercial
banking business in Chicago and, in the case of a Business Day which relates to
a Eurodollar Loan, on which dealings are carried on in the interbank eurodollar
market.

         Capital Expenditures means all expenditures which, in accordance with
generally accepted accounting principles, would be required to be capitalized
and shown on the consolidated balance sheet of the Company including without
limitation all obligations in respect of Capitalized Leases, but excluding
expenditures made in connection with the replacement, substitution or
restoration of assets to the extent financed (i) from insurance proceeds (or
other similar recoveries) paid on account of the loss of or damage to the assets
being replaced or restored or (ii) with awards of compensation arising from the
taking by eminent domain or condemnation of the assets being replaced.

         Capital Lease means, with respect to any Person, any lease of (or other
agreement conveying the right to use) any real or personal property by such
Person which, in conformity with generally accepted accounting principles, is
accounted for as a capital lease on the balance sheet of such Person.

         Cash Equivalent Investment means, at any time:

         (a) any  evidence of Debt,  maturing  not more than one year after such
time, issued or guaranteed by the United States Government;

         (b) commercial paper,  maturing not more than one year from the date of
issue, which is issued by

                           (i) a corporation (except an Affiliate of the

                                      -2-



<PAGE>

                  Company) organized under the laws of any State of the United
                  States of America or of the District of Columbia and rated at
                  least A-1 by Standard & Poor's Corporation or P-1 by Moody's
                  Investors Service, Inc., at the time of investment, or

                           (ii)  any Bank (or its holding company);

                  (c) any certificate of deposit or bankers' acceptance or
         eurodollar time deposit, maturing not more than one year after the date
         of issue, which is issued by either

                           (i) a financial institution that is a member of the
                  Federal Reserve System and has a combined capital and surplus
                  and undivided profits of not less than $100,000,000, or

                           (ii)  any Bank;

         (d) any repurchase agreement with a term of one year or less which

                           (i)  is entered into with

                                           (A)  any Bank, or

                                           (B)  any other  commercial   banking
                                     institution of the stature referred to in 
                                     clause (c)(i),

                           (ii)  is secured by a fully perfected Lien in any 
                  obligation of the type described in any of clauses (a) through
                  (c), and

                           (iii) has a market value at the time such repurchase
                  agreement is entered into of not less than 100% of the
                  repurchase obligation of such Bank (or other commercial
                  banking institution) thereunder;

                  (e) investments in money market funds that invest solely in
         Cash Equivalent Investments described in clauses (a) through (d); or

                  (f)  any deposit account with any Bank.

         Change of Control means (a) the William Blair Leveraged Capital Fund,
Walter E. Rose and John D. Strautnieks, collectively, shall at any time be the
legal and equitable owner 



                                      -3-


<PAGE>



of less than (i) prior to June 30, 1998, 22.5% in the
aggregate of the outstanding shares of common stock of the Company and (ii) on
or after June 30, 1998, 12.5% in the aggregate of the outstanding shares of
common stock of the Company; or (b) any Person or group of Persons (within the
meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as amended,
but excluding the William Blair Leveraged Capital Fund, Walter E. Rose and John
D. Strautnieks) shall acquire beneficial ownership (within the meaning of Rule
13d-3 promulgated under such Act) of more of the outstanding shares of common
stock of the Company than is owned by the William Blair Leveraged Capital Fund,
Walter E. Rose and John D. Strautnieks, collectively; or (c) during any 24-month
period, individuals who at the beginning of such period constituted the
Company's Board of Directors (together with any new directors whose election by
the Company's Board of Directors or whose nomination for election by the
Company's shareholders was approved by a vote of a majority of the directors who
either were directors at the beginning of such period or whose election or
nomination was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company.

         Collateral Documents means the Company Pledge Agreement, the Subsidiary
Pledge Agreement, the Security Agreement and any Mortgage.

         Commitment  means, as to any Bank, such Bank's Revolving  Commitment or
Term Commitment.

         Commitment Termination Date means September 25, 2001 or such earlier
date on which the Commitments shall terminate pursuant to Section 6 or 12.

         Company - see the Preamble.

         Company Pledge Agreement - see Section 11.1.7(a).

         Computation Period means any period of four consecutive Fiscal Quarters
ending on the last day of a Fiscal Quarter.

         Consolidated Net Income means, with respect to the Company and its
Subsidiaries for any period, the net income (or loss) of the Company and its
Subsidiaries for such period; provided that there shall be excluded therefrom
the income of all Subsidiaries to the extent that the declaration or payment of
dividends or similar distributions by any Subsidiary of such income is not at
the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to such Subsidiary.


                                      -4-


<PAGE>


         Contingent Liability means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to or otherwise to invest in a
debtor, or otherwise to assure a creditor against loss) any indebtedness,
obligation or other liability of any other Person (other than by endorsements of
instruments in the course of collection), or guarantees the payment of dividends
or other distributions upon the shares of any other Person. The amount of any
Person's obligation under any Contingent Liability shall (subject to any
limitation set forth therein) be deemed to be the principal amount of the debt,
obligation or other liability guaranteed thereby.

         Debt of any Person means, without duplication, (a) all indebtedness of
such Person for borrowed money, whether or not evidenced by bonds, debentures,
notes or similar instruments, (b) all obligations of such Person as lessee under
Capital Leases which have been recorded as liabilities on a balance sheet of
such Person, (c) all obligations of such Person to pay the deferred purchase
price of property or services (other than current accounts payable in the
ordinary course of business), (d) all indebtedness secured by a Lien on the
property of such Person, whether or not such indebtedness shall have been
assumed by such Person (it being understood that if such Person has not assumed
or otherwise become personally liable for any such indebtedness, the amount of
the Debt of such Person in connection therewith shall be limited to the lesser
of the face amount of such indebtedness or the fair market value of all property
of such Person securing such indebtedness), (e) all obligations, contingent or
otherwise, with respect to the face amount of all letters of credit (whether or
not drawn) and banker's acceptances issued for the account of such Person
(including, without limitation, the Letters of Credit), and (f) all Contingent
Liabilities of such Person.

         Debt Ratio means the ratio of Total Debt as of the last day of any
Fiscal Quarter to EBITDA for the Computation Period ending on such day.

         Debt to be Repaid  means all Debt listed on Exhibit H under the heading
"Debt to be Repaid."

         Dollar and the sign "$" mean lawful money of the United States of
America.



                                      -5-

<PAGE>


         EBIT means, for any Computation Period, Consolidated Net Income for
such Computation Period plus, to the extent deducted in determining Consolidated
Net Income for such Computation Period, Interest Expense and income taxes for
such Computation Period (excluding, for any applicable Computation Period, the
unusual charges taken by the Company prior to the Effective Date in amounts not
exceeding $20,000 for the first Fiscal Quarter of Fiscal Year 1996, $290,000 for
the second Fiscal Quarter of Fiscal Year 1996, $949,000 for the third Fiscal
Quarter of Fiscal Year 1996, $190,000 for the fourth Fiscal Quarter of Fiscal
Year 1996, and $226,000 for the first Fiscal Quarter of Fiscal Year 1997, in
each case as previously described in writing to the Agent and the Banks).

         EBITDA means, for any Computation Period, EBIT for such Computation
Period plus, to the extent deducted in determining Consolidated Net Income for
such Computation Period, depreciation and amortization for such Computation
Period.

         Effective Date - see Section 11.1.

         Eligible Inventory means all Inventory of the Company or any Subsidiary
which meets each of the following requirements: (a) it is in marketable
condition; (b) it is owned solely by the Company or such Subsidiary and is not
subject to any Lien whatsoever other than pursuant to the Security Agreement;
(c) it is new and unused; (d) it is Inventory constituting finished goods or raw
materials; (e) it is located at real property which is owned by the Company or
such Subsidiary or, if located on leased premises, is located at real property
with respect to which the landlord of such real property has delivered to the
Agent a landlord's consent in form and substance satisfactory to the Agent; and
(f) it is not Inventory which the Agent, acting in its discretion reasonably
exercised, shall have notified the Company in writing is not deemed to
constitute Eligible Inventory. Any Inventory which is at any time Eligible
Inventory, but which subsequently fails to meet any of the foregoing
requirements, shall forthwith cease to be Eligible Inventory.

         Eligible Receivable means a Receivable of the Company or any Subsidiary
which meets each of the following requirements: (a) if it arises from the sale
or lease of goods, such goods have been shipped or delivered to the Account
Debtor under such Receivable; (b) it is a valid, legally enforceable obligation
of the Account Debtor thereunder, and is not subject to any offset, counterclaim
or other defense on the part of such Account Debtor; (c) it is not subject to
any Lien whatsoever other than the 


                                      -6-


<PAGE>



security interest under the Security
Agreement; (d) it is evidenced by an invoice (dated not later than the date of
shipment or performance and having payment terms acceptable to the Agent)
rendered to such Account Debtor, and is not evidenced by any instrument or
chattel paper; (e) it is not owing by any Account Debtor whose obligations the
Agent or any Bank, acting in its discretion reasonably exercised, shall have
notified the Company in writing are not deemed to constitute Eligible
Receivables; (f) it is not owing by an Account Debtor who, as of the computation
date of the Borrowing Base most recently received by the Banks, shall have
failed to pay within 90 days of their due date more than 25% of the aggregate
dollar amount of the invoices of the Company or such Subsidiary evidencing any
Receivable billed to such Account Debtor; (g) it is not owing by an Account
Debtor who is an Affiliate of the Company; (h) it is not owing by an Account
Debtor who is not a permanent resident of or incorporated in any state of the
United States or the Province of Ontario, Canada; and (i) it has not been
outstanding for more than 90 days from the date of the invoice which evidences
such Receivable. A Receivable which is at any time an Eligible Receivable, but
which subsequently fails to meet any of the foregoing requirements, shall
forthwith cease to be an Eligible Receivable.

         Environmental Laws means all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines (including
consent decrees and administrative orders) relating to public health and safety
and protection of the environment.

         ERISA means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections.

         Eurocurrency Reserve Percentage means, with respect to any Eurodollar
Loan for any Interest Period, a percentage (expressed as a decimal) equal to the
daily average during such Interest Period of the percentage in effect on each
day of such Interest Period, as prescribed by the Board of Governors of the
Federal Reserve System (or any successor), for determining the aggregate maximum
reserve requirements applicable to "Eurocurrency Liabilities" pursuant to
Regulation D or any other then applicable regulation of such Board of Governors
which prescribes reserve requirements applicable to "Eurocurrency Liabilities"
as presently defined in Regulation D.




                                      -7-

<PAGE>


         Eurodollar Loan means any Loan which bears interest at a rate
determined by reference to the Eurodollar Rate (Reserve Adjusted).

         Eurodollar Office means with respect to any Bank the office or offices
of such Bank which shall be making or maintaining the Eurodollar Loans of such
Bank hereunder or such other office or offices through which such Bank
determines its Eurodollar Rate. A Eurodollar Office of any Bank may be, at the
option of such Bank, either a domestic or foreign office.

         Eurodollar Rate means, with respect to any Eurodollar Loan for any
Interest Period, the rate per annum at which Dollar deposits in immediately
available funds are offered to the Eurodollar Office of Harris two Business Days
prior to the beginning of such Interest Period by major banks in the interbank
eurodollar market as at or about 10:00 A.M., Chicago time, for delivery on the
first day of such Interest Period, for the number of days comprised therein and
in an amount equal or comparable to the amount of the Eurodollar Loan of Harris
for such Interest Period.

         Eurodollar Rate (Reserve Adjusted) means, with respect to any
Eurodollar Loan for any Interest Period, a rate per annum (rounded upwards, if
necessary, to the nearest 1/16 of 1%) determined pursuant to the following
formula:

                    Eurodollar Rate     =      Eurodollar Rate
                  (Reserve Adjusted)           1-Eurocurrency
                                               Reserve Percentage

         Event of Default means any of the events described in Section 12.1.

         Excess Cash means, for any Fiscal Quarter or Fiscal Year, as the case
may be, an amount equal to Consolidated Net Income for such period plus
consolidated depreciation, amortization and other non-cash charges of the
Company and its Subsidiaries for such period minus an amount equal to the
increase in Working Capital (plus any decrease in Working Capital) of the
Company and its Subsidiaries for such period minus scheduled payments of Debt
during such period minus the amount of Capital Expenditures made by the Company
during such period to the extent such Capital Expenditures were not made with
the proceeds of Debt.

         Federal Funds Rate means, for any day, the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor 



                                      -8-

<PAGE>


publication, published by the Federal
Reserve Bank of New York (including any such successor publication, the
"Composite 3:30 p.m. Quotations") for such day under the caption "Federal Funds
Effective Rate". If such rate is not published in the Composite 3:30 p.m.
Quotations for any Business Day, the rate for such day will be the arithmetic
mean of the rates for the last transaction in overnight Federal funds arranged
prior to 9:00 a.m., New York City time, on such day by each of three leading
brokers of Federal funds transactions in New York City, selected by the Agent.
The rate for any day which is not a Business Day shall be the rate for the
immediately preceding Business Day.

         Fiscal Year means the fiscal year of the Company and its Subsidiaries,
which period shall be the 12-month period ending on the Saturday nearest to June
30 of each year. References to a Fiscal Year with a number corresponding to any
calendar year (e.g., "Fiscal Year 1996") refer to the Fiscal Year ending on the
Saturday nearest to June 30 of such calendar year.


         Fiscal Quarter means a fiscal quarter of a Fiscal Year.


         Floating Rate Loan means any Loan which bears interest at or by
reference to the Alternate Reference Rate.

         Group - see Section 2.2.

         Guarantor means (a) as of the Effective Date, RidgePak Corporation,
Standard Packaging and Printing Co., Niemand Holdings, Inc., Niemand Industries,
Inc. and GB Labels, Inc. and (b) thereafter, the entities referred to in clause
(a) and each other Person which from time to time executes and delivers a
counterpart of the Guaranty.

         Guaranty - see Section 11.1.5.

         Harris - see the Preamble.

         Hazardous Material means any hazardous, toxic or dangerous substance or
material defined as such in (or for purposes of) any Environmental Law.

         Hedging Agreement means any interest rate, currency and commodity swap
agreement, interest rate cap agreement, interest rate collar agreement, or other
agreement or arrangement designed to protect a Person against fluctuations in
interest rates, currency exchange rates or commodity prices.

         Interest Coverage Ratio means the ratio of (a) EBIT for any 


                                      -9-


<PAGE>



Computation Period to (b) Interest Expense for such Computation Period.

         Interest Expense means for any period the consolidated interest expense
(including, without limitation, all imputed interest on Capital Leases) of the
Company and its Subsidiaries for such period; it being understood that for
purposes of calculating the Interest Coverage Ratio, Interest Expense shall be
deemed to be $726,000 for the Fiscal Quarter ending December 31, 1995, $692,000
for the Fiscal Quarter ending March 31, 1996, $656,000 for the Fiscal Quarter
ending June 30, 1996, and $653,000 for the Fiscal Quarter ending September 30,
1996 .

         Interest Period - see Section 4.3.

         Inventory means, at any time with respect to any Person, any goods held
for sale or lease, or furnished or to be furnished by such Person under any
contract of service, or held by such Person as raw materials, work in process or
materials used or consumed in a business.

         Investment of any Person means any investment in any other Person,
whether by acquisition of shares of stock or similar interest, Debt or other
obligation or security, deposit, or by loan, advance or capital contribution, or
otherwise.

         Letter of Credit - see Section 2.1.

         Letter of Credit Application means a letter of credit application in
the form then used by Harris for the type of letter of credit requested (with
appropriate adjustments to indicate that any letter of credit issued thereunder
is to be issued pursuant to, and subject to the terms and conditions of, this
Agreement).

         Lien means, when used with respect to any Person, any interest granted
by such Person in any real or personal property, asset or other right owned or
being purchased or acquired by such Person which secures payment or performance
of any obligation and shall include any mortgage, lien, encumbrance, charge or
other security interest of any kind, whether arising by contract, as a matter of
law, by judicial process or otherwise.

         Loans means Revolving Loans and Term Loans.

         Loan Documents means this Agreement, the Notes, the Guaranty, the
Letter of Credit Applications and the Collateral Documents.

         Margin means the rate per annum set forth in the table below 



                                      -10-


<PAGE>




for the non-use fee, or the applicable type of Loan opposite the applicable Debt
Ratio:


<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------==================
                     Margin                                Margin for
                     for Floating                          Floating Rate       Margin for
                     Rate Term         Margin for          Revolving           Eurodollar         Margin for
                     Loans             Eurodollar Term     Loans               Revolving          Non-Use Fee
Debt Ratio                             Loans                                   Loans
--------------------------------------------------------------------------------------------------==================
<S>                  <C>                <C>                <C>               <C>                   <C>
Greater than 3.25    0.50%             2.50%               0.25%               2.25%              0.50%
to 1
--------------------------------------------------------------------------------------------------==================
Equal to or less     0.25%             2.25%               0.00%               2.00%              0.375%
than 3.25 to 1 but
greater than 2.75
to 1
--------------------------------------------------------------------------------------------------==================
Equal to or less     0.00%             2.00%               0.00%               1.75%              0.375%
than 2.75 to 1 but
greater than 2.25
to 1
====================================================================================================================
Equal to or less     0.00%             1.75%               0.00%               1.50%              0.25%
than 2.25 to 1
====================================================================================================================
</TABLE>



The Margin shall be adjusted, to the extent applicable, 30 days (or, in the case
of the last Fiscal Quarter of any Fiscal Year, 60 days) after the end of each
Fiscal Quarter based on the Debt Ratio as of the last day of such Fiscal
Quarter; it being understood that if the Company fails to deliver the financial
statements required by Section 10.1.1 or 10.1.2, as applicable, by the 30th day
(or, if applicable, the 60th or 90th day, as the case may be) after any Fiscal
Quarter, the Margin shall be 0.25% for Floating Rate Revolving Loans, 2.25% for
Eurodollar Revolving Loans, 0.50% for Floating Rate Term Loans, 2.50% for
Eurodollar Term Loans and 0.50% for the non-use fee, respectively, until such
financial statements are delivered; it being further understood that if the
financial statements delivered pursuant to Section 10.1.1(a) result in a
different Margin than that determined pursuant to the financial statements
delivered pursuant to Section 10.1.1(b), then the Company shall pay such 

                                      -11-


<PAGE>



higher Margin  retroactively  from the 60th day after such Fiscal  Quarter.  The
initial  Margin shall be deemed to be 0.50% for Floating Rate Term Loans,  2.50%
for Eurodollar Term Loans,  0.25% for Floating Rate Revolving  Loans,  2.25% for
Eurodollar Revolving Loans and 0.50% for the non-use fee.

         Margin Stock means any "margin stock" as defined in Regulation U of the
Board of Governors of the Federal Reserve System.

         Material Adverse Effect means a material adverse effect on (a) the
financial condition, operations, business, assets or prospects of the Company
and its Subsidiaries taken as a whole or (b) the ability of the Company to
timely and fully perform any of its payment or other material obligations under
this Agreement or any other Loan Document to which it is a party.

         Mortgage means a mortgage, deed of trust or similar document granting
to the Agent a Lien on real property of the Company or any Guarantor.

         Net Worth means the Company's consolidated stockholders' equity.

         Notes means Revolving Notes and Term Notes.

         Participant - see Section 14.9.

         PBGC means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.

         Pension Plan means a "pension plan", as such term is defined in section
3(2) of ERISA, which is subject to title IV of ERISA (other than a multiemployer
plan as defined in section 4001(a)(3) of ERISA), and to which the Company or any
corporation, trade or business that is, along with the Company, a member of a
controlled group of corporations or a controlled group of trades or businesses,
as described in section 414 of the Internal Revenue Code of 1986, as amended, or
section 4001 of ERISA, may have any liability, including any liability by reason
of having been a substantial employer within the meaning of section 4063 of
ERISA at any time during the preceding five years or by reason of being deemed
to be a contributing sponsor under section 4069 of ERISA.

         Percentage means a Revolving Loan Percentage, a Term Loan Percentage or
a Total Percentage, as the context may require.

         Person means any natural person, corporation, partnership, trust,
association, governmental authority or unit, or any other 


                                      -12-


<PAGE>



entity, whether acting in an individual, fiduciary or other capacity.

         Receivable means, with respect to any Person, any right of such Person
to payment for goods sold or leased or services rendered.

         Required Banks means (i) so long as three or more Banks are party to
this Agreement, Banks having an aggregate Total Percentage of 66-2/3% or more
and (ii) at any other time, Banks having an aggregate Total Percentage of 85% or
more.

         Revolving Commitment means, as to any Bank, such Bank's commitment to
make Revolving Loans, and to issue or participate in Letters of Credit, pursuant
to this Agreement. The amount of each Bank's initial Revolving Commitment is set
forth on Schedule I. The initial amount of the aggregate Revolving Commitments
of all Banks is $10,000,000.

         Revolving Loans - see Section 2.1.

         Revolving Loan Percentage means, as to any Bank, the percentage which
(a) the aggregate amount of such Bank's Revolving Commitment (or after
termination of the Revolving Commitments, the outstanding principal amount of
such Bank's Revolving Loans) is of (b) the aggregate amount of the Revolving
Commitments of all Banks (or, after termination of the Revolving Commitments,
the outstanding principal amount of all Revolving Loans).

         Revolving Note - see Section 3.1(a).

         SEC means the Securities and Exchange Commission.

         Security Agreement - see Section 11.1.6.

         Stated Amount means with respect to any Letter of Credit at any date of
determination, the maximum aggregate amount available thereunder at any time
during the then ensuing term of such Letter of Credit under any and all
circumstances, plus the aggregate amount of all unreimbursed payments and
disbursements under such Letter of Credit.

         Subsidiary means, with respect to any Person, a corporation of which
such Person and/or its other Subsidiaries own, directly or indirectly, such
number of outstanding shares as have more than 50% of the ordinary voting power
for the election of directors. Unless the context otherwise requires, each
reference to Subsidiaries herein shall be a reference to Subsidiaries of the
Company.


                                      -13-


<PAGE>


         Subsidiary Pledge Agreement - see Section 11.1.7(b).

         Term Commitment means, as to any Bank, such Bank's commitment to make
Term Loans pursuant to this Agreement. The amount of each Bank's Term Commitment
is set forth on Schedule I. The amount of the aggregate Term Commitments of all
Banks is $25,000,000.

         Term Loans - see Section 2.1.

         Term Loan Percentage means, as to any Bank, the percentage which (x)
the Term Commitment of such Bank (or, after the making of the Term Loans, the
principal amount of such Bank's Term Loan) is of (y) the aggregate amount of the
Term Commitments of all Banks (or, after the making of the Term Loans, the
aggregate principal amount of all Term Loans).

         Term Note - see Section 3.1(b).

         Total Debt means all Debt of the Company and its Subsidiaries
determined on a consolidated basis.

         Total Percentage means as to any Bank the percentage which (a) the
aggregate amount of such Bank's Revolving Commitment (or, after termination of
the Revolving Commitments, the outstanding principal amount of such Bank's
Revolving Loans) plus the outstanding principal amount of such Bank's Term Loan
is of (b) the aggregate amount of the Revolving Commitments of all Banks (or,
after termination of the Revolving Commitments, the outstanding principal amount
of all Revolving Loans) plus the outstanding principal amount of all Term Loans.
The initial Total Percentage for each Bank is set forth opposite such Bank's
name on Schedule I.

         Type of Loan or Borrowing - see Section 2.2. The types of Loans or
borrowings under this Agreement are as follows: Floating Rate Loans or
borrowings and Eurodollar Loans or borrowings.

         Unmatured Event of Default means any event which if it continues
uncured will, with lapse of time or notice or lapse of time and notice,
constitute an Event of Default.

         Welfare Plan means a "welfare plan", as such term is defined in section
3(1) of ERISA.

         Working Capital means, at any date, the excess of (i) the consolidated
current assets of the Company and its Subsidiaries as of such date over (ii) the
consolidated current liabilities of 


                                      -14-


<PAGE>


the  Company  and  its  Subsidiaries  as of such  date  (but  excluding  current
maturities of indebtedness for borrowed money which indebtedness by its terms is
due more than one year from such date).

         1.2 Other  Definitional  Provisions.  Unless  otherwise  defined or the
context otherwise requires, all financial and accounting terms used herein or in
any of the Loan Documents or any certificate or other document made or delivered
pursuant  hereto  shall  be  defined  in  accordance  with  generally   accepted
accounting  principles  consistently  applied;  provided  that  if  the  Company
notifies the Agent that the Company wishes to amend any covenant  (including any
financial  covenant) to eliminate the effect of any change in generally accepted
accounting  principles  on the  operation  of  such  covenant  (or if the  Agent
notifies  the Company  that the Agent and the Banks wishes to amend any covenant
for such  purpose),  then the Company's  compliance  with such covenant shall be
determined on the basis of generally  accepted  accounting  principles in effect
immediately  before  the  relevant  change  in  generally  accepted   accounting
principles  became  effective,  until  either such notice is  withdrawn  or such
covenant is amended in a manner  satisfactory  to the  Company and the  Required
Banks.  When  used in this  Agreement,  the term  "financial  statements"  shall
include the notes and schedules thereto.

         SECTION    2  COMMITMENTS  OF THE  BANKS;  TYPES OF LOANS;  LETTERS  OF
                    CREDIT; BORROWING AND CONVERSION PROCEDURES.

2.1 Commitments. On and subject to the terms and conditions of this Agreement,
each of the Banks, severally and for itself alone, agrees as follows:

         (a) each Bank agrees to make loans on a revolving basis ("Revolving
Loans") from time to time before the Commitment Termination Date in such Bank's
Revolving Loan Percentage of such aggregate amounts as the Company may from time
to time request from all Banks, provided that (i) the aggregate principal amount
which any Bank shall be committed to have outstanding hereunder on loan to the
Company shall not at any one time exceed such Bank's Revolving Commitment and
(ii) the sum of (x) the aggregate outstanding principal amount of all Revolving
Loans plus (y) the aggregate Stated Amount of all Letters of Credit shall not at
any time exceed the lesser of (A) the aggregate amount of the Revolving
Commitments and (B) the amount of the Borrowing Base;

         (b) on the Effective Date each Bank agrees to make a term loan (a "Term
Loan") in such Bank's Term Loan Percentage of such aggregate amounts as the
Company may request on such date from all Banks, provided that the aggregate
principal amount of all Term Loans which all Banks shall be committed to lend on
the


                                      -15-


<PAGE>



Effective Date shall not exceed $25,000,000; and

         (c) Harris agrees to issue letters of credit, in each case containing
such terms and conditions as are permitted by this Agreement and are
satisfactory to Harris (collectively the "Letters of Credit" and individually
each a "Letter of Credit"), at the request of and for the account of the Company
from time to time before the Commitment Termination Date and, as more fully set
forth in Section 2.6, each Bank agrees to purchase a participation in each such
Letter of Credit, provided that (i) the aggregate Stated Amount of all Letters
of Credit shall not at any time exceed $1,000,000 and (ii) the sum of (x) the
aggregate outstanding principal amount of all Revolving Loans plus (y) the
aggregate Stated Amount of all Letters of Credit shall not at any time exceed
the lesser of (A) the aggregate amount of the Revolving Commitments and (B) the
amount of the Borrowing Base.

         2.2 Various Types of Loans. Each Revolving Loan shall be, and each Term
Loan may be divided into  tranches  which are,  either a Floating Rate Loan or a
Eurodollar  Loan (each a "type" of Loan),  as the Company  shall  specify in the
related  notice of  borrowing  or  conversion  pursuant  to Section  2.3 or 2.4.
Eurodollar  Loans having the same Interest Period are sometimes called a "Group"
or  collectively  "Groups".  Floating  Rate  Loans and  Eurodollar  Loans may be
outstanding  at the same time,  provided  that (i) not more than five  different
Groups of  Eurodollar  Loans shall be  outstanding  at any one time and (ii) the
aggregate  principal amount of each Group of Eurodollar Loans shall at all times
be at least  $1,000,000 and an integral  multiple of $100,000.  All  borrowings,
conversions  and  repayments  of Loans  shall be effected so that each Bank will
have a pro rata share (according to the applicable  Percentage) of all types and
Groups of Loans.

         2.3 Borrowing Procedures.  The Company shall give written or telephonic
notice to the Agent of each proposed borrowing not later than (a) in the case of
a Floating  Rate  borrowing,  10:00 A.M.,  Chicago time, on the proposed date of
such  borrowing,  and (b) in the case of a  Eurodollar  borrowing,  12:00  noon,
Chicago  time,  at least three  Business Days prior to the proposed date of such
borrowing.  Each such notice shall be effective upon receipt by the Agent, shall
be irrevocable, and shall specify the date, amount and type of borrowing and, in
the case of a  Eurodollar  borrowing,  the  initial  Interest  Period  therefor.
Promptly upon receipt of such notice,  the Agent shall advise each Bank thereof.
Not later than 1:00 p.m.,  Chicago  time,  on the date of a proposed  borrowing,
each  Bank  shall  provide  the  Agent at the  principal  office of the Agent in
Chicago with immediately available funds in the amount of such Bank's Percentage
of such borrowing and, subject to the  satisfaction of the conditions  

                                      -16-


<PAGE>



precedent  set forth in Section 11 with  respect  to such  borrowing,  the Agent
shall pay over the requested  amount to the Company on the  requested  borrowing
date.  Each  borrowing  shall be on a Business  Day and shall be in an aggregate
amount of at least (i) $1,000,000 and an integral  multiple of $100,000,  in the
case of Eurodollar Loans, and (ii) $100,000 and an integral multiple of $50,000,
in the case of Floating Rate Loans. Unless the Company shall otherwise direct in
writing,  the proceeds of all  borrowings  shall be  deposited to the  Company's
demand deposit account no. 2708915 maintained with Harris.

         2.4  Procedures  for  Conversion  of  Type  of  Loan.  Subject  to  the
provisions  of Section  2.2,  the  Company  may  convert  all or any part of any
outstanding Loan into a Loan of a different type by giving written or telephonic
notice to the Agent not later than (a) in the case of conversion into a Floating
Rate Loan,  10:00 A.M.,  Chicago time, on the proposed date of such  conversion,
and (b) in the case of a conversion into a Eurodollar Loan, 12:00 noon,  Chicago
time,  at  least  three  Business  Days  prior  to the  proposed  date  of  such
conversion. Each such notice shall be effective upon receipt by the Agent, shall
be irrevocable,  and shall specify the date and amount of such  conversion,  the
Loan to be so converted,  the type of Loan to be converted into and, in the case
of a conversion into a Eurodollar  Loan, the initial  Interest Period  therefor.
Promptly upon receipt of such notice,  the Agent shall advise each Bank thereof.
Subject  to  Sections  2.10 and 2.11,  such Loan  shall be so  converted  on the
requested date of conversion. Each conversion shall be on a Business Day.

         2.5 Letter of Credit  Procedures.  The  Company  shall  give  notice to
Harris of the proposed issuance of each Letter of Credit on a Business Day which
is at least  three  Business  Days (or such  lesser  period as Harris may agree)
prior to the  proposed  date of  issuance  of such  Letter of Credit.  Each such
notice shall be accompanied by a Letter of Credit Application,  duly executed by
the Company and in all material respects  satisfactory to Harris,  together with
such other documentation as Harris may reasonably request in support thereof, it
being  understood that each Letter of Credit  Application  shall specify,  among
other things,  the date on which the proposed  Letter of Credit is to be issued,
the expiration  date of such Letter of Credit (which shall not be later than the
then-scheduled Commitment Termination Date) and whether such Letter of Credit is
to be  transferable  in whole or in part.  Subject  to the  satisfaction  of the
conditions  precedent  set forth in Section 11 with  respect to the  issuance of
such Letter of Credit, Harris shall issue such Letter of Credit on the requested
issuance date.

         2.6 Participations in Letters of Credit. Concurrently with



                                      -17-


<PAGE>


the  issuance of each Letter of Credit,  Harris shall be deemed to have sold and
transferred to each other Bank, and each other Bank shall be deemed  irrevocably
and unconditionally to have purchased and received from Harris, without recourse
or warranty,  an undivided  interest  and  participation,  to the extent of such
other  Bank's   Percentage,   in  such  Letter  of  Credit  and  the   Company's
reimbursement  obligations  with  respect  thereto.  For  the  purposes  of this
Agreement,  the unparticipated  portion of each Letter of Credit shall be deemed
to be Harris's  "participation"  therein. Harris hereby agrees, upon issuance of
any Letter of Credit,  to deliver to each Bank a description of the type, stated
amount  and  expiry  date of such  Letter of  Credit,  together  with such other
information related thereto as such other Bank may reasonably request.

         2.7 Reimbursement  Obligations.  The Company hereby unconditionally and
irrevocably  agrees to reimburse Harris for each payment or disbursement made by
Harris  under any Letter of Credit  honoring  any demand for payment made by the
beneficiary  thereunder,  in  each  case  on  the  date  that  such  payment  or
disbursement  is made.  Any amount not reimbursed on the date of such payment or
distribution  shall bear interest from and including the date of such payment or
disbursement  to but not  including  the date that Harris is  reimbursed  by the
Company therefor, payable on demand, at a rate per annum equal to the sum of the
Alternate  Reference  Rate  from time to time in effect  plus 2%.  Harris  shall
notify the Company  whenever  any demand for payment is made under any Letter of
Credit by the beneficiary  thereunder;  provided,  however,  that the failure of
Harris to so notify  the  Company  shall not  affect the rights of Harris or the
Banks in any manner whatsoever.

         2.8 Limitation on Harris's  Obligations.  In determining whether to pay
under any Letter of Credit,  Harris shall have no  obligation  to the Company or
any Bank other than to confirm that any documents required to be delivered under
such  Letter of Credit  appear to have been  delivered  and  appear to comply on
their face with the  requirements of such Letter of Credit.  Any action taken or
omitted to be taken by Harris under or in connection  with any Letter of Credit,
if taken or omitted in the absence of gross  negligence  or willful  misconduct,
shall not impose upon Harris any  liability to the Company or any Bank and shall
not  reduce or  impair  the  Company's  reimbursement  obligations  set forth in
Section 2.7 or the obligations of the Banks pursuant to Section 2.9.

         2.9  Funding  by Banks to  Harris.  If  Harris  makes  any  payment  or
disbursement  under any  Letter of Credit  and the  Company  has not  reimbursed
Harris in full for such payment or disbursement by 11:00 A.M.,  Chicago time, on
the date of such 

                                      -18-


<PAGE>



payment or disbursement,  or if any  reimbursement  received by
Harris from the Company is or must be returned or  rescinded  upon or during any
bankruptcy or reorganization of the Company or otherwise,  each other Bank shall
be obligated to pay to Harris,  in full or partial payment of the purchase price
of its participation in such Letter of Credit,  its pro rata share (according to
its  Percentage)  of such payment or  disbursement  (but no such  payment  shall
diminish the  obligations of the Company under Section 2.8), and the Agent shall
promptly  notify  each other Bank  thereof.  Each  other  Bank  irrevocably  and
unconditionally  agrees,  severally and for itself alone, to so pay to the Agent
in  immediately  available  funds for Harris's  account the amount of such other
Bank's Percentage of such payment or disbursement. If and to the extent any Bank
shall not have made such  amount  available  to the Agent by 2:00 P.M.,  Chicago
time, on the Business Day on which such Bank  receives  notice from the Agent of
such payment or disbursement  (it being understood that any such notice received
after  noon,  Chicago  time,  on any  Business  Day shall be deemed to have been
received on the next following  Business Day),  such Bank agrees to pay interest
on such amount to the Agent for  Harris's  account  forthwith on demand for each
day from and  including  the date such amount was to have been  delivered to the
Agent to but  excluding  the date such amount is paid, at a rate per annum equal
to (a) for the first three days after  demand,  the Federal Funds Rate from time
to time in effect and (b) thereafter,  the Alternate Reference Rate from time to
time in effect. Any Bank's failure to make available to the Agent its Percentage
of any such  payment or  disbursement  shall not  relieve  any other Bank of its
obligation hereunder to make available to the Agent such other Bank's Percentage
of such payment,  but no Bank shall be responsible  for the failure of any other
Bank to make  available  to the Agent such other Bank's  Percentage  of any such
payment or disbursement.

         2.10 Warranty.  Each notice of borrowing and/or of conversion  pursuant
to Section  2.3 or 2.4 and the  delivery  of each  Letter of Credit  Application
pursuant to Section 2.5 shall automatically constitute a warranty by the Company
to the  Agent  and each Bank to the  effect  that on the date of such  requested
borrowing or conversion or the issuance of the  requested  Letter of Credit,  as
the case may be, (a) the  warranties  of the Company  contained  in Section 9 of
this  Agreement  shall be true and correct as of such  requested  date as though
made on the date  thereof  and (b) no Event of  Default  or  Unmatured  Event of
Default shall have then occurred and be continuing or will result therefrom.

         2.11 Conditions. Notwithstanding any other provision of this Agreement,
(a) no Bank shall be obligated to make any Loan,  (b) no Bank shall be obligated
to convert into or permit the 



                                      -19-

<PAGE>


continuation at the end of the applicable Interest Period of any Eurodollar Loan
and (c) Harris  shall not be  obligated to issue any Letter of Credit if, in any
such case,  an Event of Default or  Unmatured  Event of Default  exists or would
result therefrom.

         2.12 Commitments  Several.  The failure of any Bank to make a requested
Loan on any date shall not  relieve any other Bank of its  obligation  to make a
Loan on such date, but no Bank shall be responsible for the failure of any other
Bank to make any Loan to be made by such other Bank.

SECTION 3 NOTES EVIDENCING LOANS.

         3.1 Notes. (a) The Revolving Loans of each Bank shall be evidenced by a
promissory note (as amended,  supplemented,  replaced or otherwise modified from
time to time,  individually  each a "Revolving  Note" and  collectively  for all
Banks the  "Revolving  Notes")  substantially  in the form of Exhibit A-1,  with
appropriate insertions,  dated the Effective Date (or such earlier date as shall
be  satisfactory  to the Agent),  payable to the order of such Bank in an amount
equal to such Bank's Revolving  Commitment (or, if less, in the aggregate unpaid
principal  amount  of all  of  such  Bank's  Revolving  Loans)  in  full  on the
Commitment Termination Date.

         (b) The Term Loan of each Bank shall be evidenced by a promissory note
(as amended, supplemented, replaced or otherwise modified from time to time,
individually each a "Term Note" and collectively for all Banks the "Term Notes")
substantially in the form of Exhibit A-2, with appropriate insertions, dated the
Effective Date (or such earlier date as shall be satisfactory to the Agent)
payable to the order of such Bank in an amount equal to the amount of such
Bank's Term Loan and payable in 28 consecutive quarterly installments equal to
such Bank's Term Loan Percentage of (i) $625,000 in the case of the first four
installments and (ii) $937,500 in the case of the remaining 24 installments.
Such installments shall be payable on the last day of each March, June,
September and December, commencing December 31, 1996.

         3.2  Recordkeeping.  Each Bank shall record in its records the date and
amount of each Loan made by such Bank, each repayment or conversion thereof and,
in the case of each Eurodollar Loan, the dates on which each Interest Period for
such Loan shall begin and end. The aggregate unpaid principal amount so recorded
shall be  rebuttable  presumptive  evidence of the  principal  amount  owing and
unpaid on such  Bank's  Notes.  The  failure to so record any such amount or any
error in so  recording  any such amount shall not,  however,  limit or otherwise
affect the  obligations of the Company  hereunder or under any Note to repay


                                      -20-


<PAGE>




the principal  amount of the Loans evidenced by such Note together with all 
interest accruing thereon.

SECTION 4 INTEREST

         4.1 Interest Rates.  The Company promises to pay interest on the unpaid
principal amount of each Loan for the period commencing on the date of such Loan
until such Loan is paid in full, as follows:

                  (a) at all times while such Loan is a Floating Rate Loan, at a
         rate per annum equal to the sum of the Alternate Reference Rate from
         time to time in effect plus the Margin from time to time in effect; and

                  (b) at all times while such Loan is a Eurodollar Loan, at a
         rate per annum equal to the sum of the Eurodollar Rate (Reserve
         Adjusted) applicable to each Interest Period for such Loan plus the
         Margin from time to time in effect;

provided, however, that at any time an Event of Default exists, the interest
rate applicable to each Loan shall be increased by 2%.

         4.2 Interest Payment Dates. Accrued interest on each Floating Rate Loan
shall be  payable  on the last day of each  calendar  quarter  and at  maturity,
commencing  with the first of such  dates to occur  after the date of such Loan.
Accrued  interest  on each  Eurodollar  Loan shall be payable on the last day of
each Interest  Period relating to such Loan (and, in the case of each Eurodollar
Loan with an  Interest  Period in excess of three  months,  on each  three-month
anniversary of such Loan) and at maturity.  After maturity,  accrued interest on
all Loans shall be payable on demand.

         4.3 Interest  Periods.  Each  "Interest  Period" for a Eurodollar  Loan
shall  commence on the date such  Eurodollar  Loan is made or  converted  from a
Floating Rate Loan, or on the expiration of the immediately  preceding  Interest
Period for such  Eurodollar  Loan,  and shall end on the date which is one, two,
three or six months thereafter, as the Company may specify:

                  (a) in the case of an Interest Period which commences on the
         date a Eurodollar Loan is made or converted from a Floating Rate Loan,
         in the related notice of borrowing or conversion pursuant to Section
         2.3 or 2.4, or

                  (b) in the case of a succeeding Interest Period with respect
         to any Eurodollar Loan, by written or telephonic notice to the Agent
         (which shall promptly advise each Bank 




                                      -21-

<PAGE>



         thereof)  not later than  12:00  noon,  Chicago  time,  at least  three
         Business  Days  prior  to the  first  day of such  succeeding  Interest
         Period,  it  being  understood  that  (i)  each  such  notice  shall be
         effective  upon  receipt by the Agent and (ii) if the Company  fails to
         give such notice, such Loan shall automatically  become a Floating Rate
         Loan at the end of its then-current Interest Period.

Each Interest Period for a Eurodollar Loan which would otherwise end on a day
which is not a Business Day shall end on the immediately succeeding Business Day
(unless such immediately succeeding Business Day is the first Business Day of a
calendar month, in which case such Interest Period shall end on the immediately
preceding Business Day). The Company may not select any Interest Period (a) for
a Revolving Loan which would end after the then-scheduled Commitment Termination
Date or (b) for any Term Loan if, after giving effect to such selection, the
Company would have to prepay any Eurodollar Loan in order to make any scheduled
prepayment of such Term Loan.

         4.4 Setting and Notice of Eurodollar  Rates. The applicable  Eurodollar
Rate for each  Interest  Period  shall be  determined  by the Agent,  and notice
thereof shall be given by the Agent promptly to the Company and each Bank.  Each
determination of the applicable Eurodollar Rate by the Agent shall be conclusive
and binding upon the parties hereto,  in the absence of demonstrable  error. The
Agent  shall,  upon written  request of the Company or any Bank,  deliver to the
Company or such Bank a statement  showing the computations  used by the Agent in
determining any applicable Eurodollar Rate hereunder.

         4.5  Computation  of Interest.  Interest on all Loans shall be computed
for the actual  number of days  elapsed on the basis of a year of 360 days.  The
applicable interest rate for each Floating Rate Loan shall change simultaneously
with each change in the Alternate Reference Rate.


                                      -22-


<PAGE>




SECTION 5 FEES.

         5.1 Non-Use Fee. The Company agrees to pay to the Agent for the account
of each Bank a non-use  fee for the period  from and  including  the date of the
execution  and  delivery  of this  Agreement  to but  excluding  the  Commitment
Termination  Date equal to the Margin  multiplied  by the unused  amount of such
Bank's  Revolving  Commitment  without  regard to any  limitation  on borrowings
resulting  from the amount of the  Borrowing  Base.  Such  non-use  fee shall be
payable  in  arrears  on  the  last  day of  each  calendar  quarter  and on the
Commitment  Termination  Date,  in each such case for the period then ending for
which such  non-use fee shall not have been  theretofore  paid.  The non-use fee
shall be computed  for the actual  number of days elapsed on the basis of a year
of 360 days.

         5.2 Letter of Credit Fees.  (a) The Company  agrees to pay to the Agent
for the account of the Banks pro rata according to their respective  Percentages
a letter of credit fee (1) in the case of each stand-by  Letter of Credit,  at a
rate per annum equal to the Margin with respect to  Eurodollar  Revolving  Loans
multiplied by the aggregate  daily  average  amount  available to be drawn under
such stand-by  Letter of Credit,  computed for the actual number of days elapsed
on the  basis  of a year of 360  days,  and (2) in the  case of each  commercial
Letter of Credit,  in an amount  equal to  Harris's  standard  fee with  respect
thereto,  in each  case  payable  in  arrears  on the last day of each  calendar
quarter and on the Commitment Termination Date for the period from and including
the date of the issuance of such Letter of Credit to but excluding the date such
payment is due or, if earlier,  the date on which such Letter of Credit  expired
or was terminated.

         (b) In addition, with respect to each Letter of Credit, the Company
agrees to pay to Harris such fees and expenses as Harris customarily requires in
connection with the issuance, negotiation, processing and/or administration of
letters of credit in similar situations.

         5.3  Agent's  Fees.  The  Company  agrees to pay to the Agent  periodic
agent's  fees,  in each case at such times and in such  amounts as are  mutually
agreed upon by the Company and the Agent.


                                      -23-


<PAGE>




SECTION  6  REDUCTION OR TERMINATION OF THE COMMITMENTS; PREPAYMENTS.

         6.1 Reduction or Termination of the Commitments.

         6.1.1  Termination  of Term  Commitments.  After the making of the Term
Loans on the Effective Date, the Term  Commitments  shall be terminated in their
entirety.

         6.1.2 Voluntary  Reduction or Termination of  Commitments.  The Company
may from time to time on at least  five  Business  Days'  prior  written  notice
received  by  the  Agent  (which  shall  promptly   advise  each  Bank  thereof)
permanently reduce the amount of the Revolving Commitments to an amount not less
than the sum of (A) the aggregate unpaid principal amount of the Revolving Loans
plus  (B) the  aggregate  Stated  Amount  of all  Letters  of  Credit.  Any such
reduction shall be in an amount not less than $1,000,000. The Company may at any
time on like notice terminate the Revolving  Commitments upon payment in full of
all  Revolving  Loans  and all other  then-payable  obligations  of the  Company
hereunder in respect of the Revolving Commitments and cash  collateralization in
full,  pursuant  to  documentation  in form and  substance  satisfactory  to the
Required  Banks,  of all  obligations  arising  with  respect to the  Letters of
Credit.

         6.1.3  Reductions Pro Rata. All reductions of the Commitments  shall be
pro rata among the Banks according to their respective Percentages.

         6.2 Prepayments.

         6.2.1  Mandatory  Prepayments.  On each  date on  which  the  Revolving
Commitments are reduced pursuant to Section 6.1.2, the Company shall also make a
prepayment of the applicable Revolving Loans in the amount (if any) by which the
outstanding  principal  amount of such  Revolving  Loans  exceeds the  Revolving
Commitments.  The Company shall make a prepayment of the Revolving Loans on each
date on which the sum of (i) the  aggregate  principal  amount of the  Revolving
Loans plus (ii) the aggregate Stated Amount of all Letters of Credit exceeds the
Borrowing Base, in an amount equal to such excess (rounded upward, if necessary,
to the nearest  multiple of  $100,000).  In addition,  the Company  shall make a
prepayment  of the Term Loans on each of September  30, 1997 and  September  30,
1998 in an  amount  equal to 50% of the  Excess  Cash for the  Fiscal  Year most
recently  ended.  Any  prepayment  of a Term Loan shall be applied to the unpaid
installments  of such Term Loan in the  inverse  order of the  maturity  of such
installments. Each such prepayment shall be applied, first, to the Floating Rate
Loans then  outstanding,  second,  to Eurodollar Loans having an Interest Period
ending on the date of such  


                                      -24-


<PAGE>



prepayment and, then (subject to Section 8.4), to such  Eurodollar  Loans as the
Company may specify by notice to the Agent  prior to or  concurrently  with such
prepayment (or, in the absence of such notice,  to such Eurodollar  Loans as the
Agent may elect).

         6.2.2 Voluntary  Prepayments.  The Company may from time to time prepay
the Loans in whole or in part,  provided  that (a) the  Company  shall  give the
Agent (which shall  promptly  advise each Bank) not less than one Business Day's
prior written  notice  thereof,  specifying the Loans to be prepaid and the date
and amount of prepayment,  (b) any prepayment of a Eurodollar  Loan prior to the
end of an Interest  Period  therefor  shall be subject to Section  8.4, (c) each
partial prepayment shall be in a principal amount of at least (i) $1,000,000 and
an integral  multiple of $100,000,  in the case of  Eurodollar  Loans,  and (ii)
$100,000  and an  integral  multiple of  $50,000,  in the case of Floating  Rate
Loans, (d) any prepayment of a Eurodollar Loan shall include accrued interest to
the  date of  prepayment  on the  principal  amount  being  repaid,  and (e) any
prepayment  of a Term Loan shall be applied to the unpaid  installments  of such
Term Loan in the inverse order of the maturity of such installments.

SECTION 7 MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES.

         7.1 Making of Payments. All payments of principal of or interest on the
Loans, and of all fees, shall be made by the Company to the Agent in immediately
available  funds at its office in Chicago not later than noon,  Chicago time, on
the date due;  and funds  received  after that hour shall be deemed to have been
received by the Agent on the next  following  Business  Day. The Company  hereby
authorizes the Agent to charge the Company's  demand deposit account no. 2708915
maintained  with  Harris  for the  amount  of any such  payment  on the due date
therefor,  but the  Agent's  failure to so charge such  account  shall in no way
affect the  obligation of the Company to make any such payment.  The Agent shall
promptly remit to each Bank its share of all such payments received in collected
funds by the Agent for the account of such Bank.

         All payments under Sections 8.1 and 8.4 shall be made by the Company
directly to the Bank or Banks entitled thereto.

         7.2 Application of Certain Payments. Each payment of principal shall be
applied to such Loans as the  Company  shall  direct by notice to be received by
the Agent on or before  the date of such  payment  or,  in the  absence  of such
notice, as the Agent shall determine in its reasonable discretion.  Concurrently
with each  remittance  to any Bank of its share of any such  payment,  the Agent
shall advise such Bank as to the application of such payment.


                                      -25-



<PAGE>


         7.3 Due Date  Extension.  If any payment of principal or interest  with
respect to any of the Notes,  or of any fees,  falls due on a day which is not a
Business  Day,  then  such due  date  shall be  extended  to the next  following
Business Day  (unless,  in the case of a Eurodollar  Loan,  such next  following
Business Day is the first Business Day of a calendar  month,  in which case such
due date shall be the  immediately  preceding  Business Day) and, in the case of
principal, additional interest shall accrue and be payable for the period of any
such extension.

         7.4 Setoff.  The  Company  agrees that the Agent and each Bank have all
rights of set-off and bankers' lien provided by applicable  law, and in addition
thereto,  the Company  agrees  that at any time (i) any payment or other  amount
owing by the Company  under this  Agreement is then due to the Agent or any Bank
or (ii) any  Unmatured  Event of Default  under  Section  12.1.4 or any Event of
Default exists, the Agent and each Bank may apply to the payment of such payment
or other  amount  (or, in the case of clause  (ii),  to any  obligations  of the
Company  hereunder,  whether  or not then  due) any and all  balances,  credits,
deposits, accounts or moneys of the Company then or thereafter with the Agent or
such Bank.

         7.5  Proration  of  Payments.  If any Bank shall  obtain any payment or
other  recovery  (whether  voluntary,  involuntary,  by application of offset or
otherwise)  on account of principal of or interest on any Loan (or on account of
its  participation  in any  Letter of Credit) in excess of its pro rata share of
payments and other  recoveries  obtained by all Banks on account of principal of
and interest on Loans (or such  participations) then held by them (other than in
respect of an Affected Loan), such Bank shall purchase from the other Banks such
participations in the Loans (or sub-participations in Letters of Credit) held by
them as shall be  necessary  to cause such  purchasing  Bank to share the excess
payment or other recovery ratably with each of them; provided,  however, that if
all or any  portion  of the  excess  payment  or other  recovery  is  thereafter
recovered  from such  purchasing  Bank,  the purchase shall be rescinded and the
purchase price restored to the extent of such recovery.



                                      -26-

<PAGE>





SECTION  8 INCREASED COSTS;  SPECIAL  PROVISIONS FOR EURODOLLAR
LOANS.

         8.1 Increased Costs. (a) If, after the date hereof, the adoption of any
applicable law, rule or regulation,  or any change therein, or any change in the
interpretation or administration thereof by any governmental authority,  central
bank or comparable  agency  charged with the  interpretation  or  administration
thereof,  or compliance by any Bank (or any Eurodollar Office of such Bank) with
any  request or  directive  (whether or not having the force of law) of any such
authority, central bank or comparable agency

                  (A) shall subject any Bank (or any Eurodollar Office of such
         Bank) to any tax, duty or other charge with respect to its Eurodollar
         Loans, its Notes or its obligation to make Eurodollar Loans, or shall
         change the basis of taxation of payments to any Bank of the principal
         of or interest on its Eurodollar Loans or any other amounts due under
         this Agreement in respect of its Eurodollar Loans or its obligation to
         make Eurodollar Loans (except for changes in the rate of tax on the
         overall net income of such Bank or its Eurodollar Office imposed by the
         jurisdiction in which such Bank's principal executive office or
         Eurodollar Office is located); or

                  (B) shall impose, modify or deem applicable any reserve
         (including, without limitation, any reserve imposed by the Board of
         Governors of the Federal Reserve System, but excluding any reserve
         included in the determination of interest rates pursuant to Section 4),
         special deposit or similar requirement against assets of, deposits with
         or for the account of, or credit extended by any Bank (or any
         Eurodollar Office of such Bank); or

                  (C) shall impose on any Bank (or its Eurodollar Office) any
         other condition affecting its Eurodollar Loans, its Notes or its
         obligation to make Eurodollar Loans;

and the result of any of the foregoing is to increase the cost to (or in the
case of Regulation D of the Board of Governors of the Federal Reserve System, to
impose a cost on) such Bank (or any Eurodollar Office of such Bank) of making or
maintaining any Eurodollar Loan, or to reduce the amount of any sum received or
receivable by such Bank (or its Eurodollar Office) under this Agreement or under
its Notes with respect thereto, then upon demand by such Bank (which demand
shall be accompanied by a statement setting forth in reasonable detail the basis
for and a calculation of the amount of such demand, a copy of which shall be
furnished to the Agent), the Company shall pay directly to such Bank such
additional amount or amounts as will compensate 


                                      -27-


<PAGE>



such Bank for such increased cost or such reduction.

         (b) If any Bank shall reasonably determine that the adoption or
phase-in of any applicable law, rule or regulation regarding capital adequacy,
or any change therein, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Bank (or
its Eurodollar Office) or any Person controlling such Bank with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Bank's or such controlling
Person's capital as a consequence of such Bank's obligations hereunder
(including, without limitation, such Bank's obligations under its Commitments)
to a level below that which such Bank or such controlling Person could have
achieved but for such adoption, change or compliance (taking into consideration
such Bank's or such controlling Person's policies with respect to capital
adequacy) by an amount deemed by such Bank or such controlling Person to be
material, then from time to time, upon demand by such Bank (which demand shall
be accompanied by a statement setting forth in reasonable detail the basis for
and a calculation of the amount of such demand, a copy of which shall be
furnished to the Agent), the Company shall pay to such Bank such additional
amount or amounts as will compensate such Bank or such controlling Person for
such reduction.

         8.2 Basis for Determining  Interest Rate Inadequate or Unfair.  If with
respect to any Interest Period:

                  (a) deposits in Dollars (in the applicable amounts) are not
         being offered to the Agent in the interbank eurodollar market for such
         Interest Period, or the Agent otherwise reasonably determines (which
         determination shall be binding and conclusive on the Company) that by
         reason of circumstances affecting the interbank eurodollar market
         adequate and reasonable means do not exist for ascertaining the
         applicable Eurodollar Rate;

                  (b) Banks having an aggregate Percentage of 33% or more advise
         the Agent that the Eurodollar Rate (Reserve Adjusted) as determined by
         the Agent will not adequately and fairly reflect the cost to such Banks
         of maintaining or funding such Loans for such Interest Period, or that
         the making or funding of Eurodollar Loans has become impracticable as a
         result of an event occurring after the Effective Date which in the
         opinion of such Banks materially affects such Loans,


                                      -28-



<PAGE>


then the Agent shall promptly notify the other parties thereof and, so long as
such circumstances shall continue, (i) no Bank shall be under any obligation to
make or convert into Eurodollar Loans and (ii) on the last day of the current
Interest Period for each Eurodollar Loan, such Loan shall, unless then repaid in
full, automatically convert to a Floating Rate Loan.

         8.3 Changes in Law Rendering  Eurodollar  Loans Unlawful.  In the event
that any  change in  (including  the  adoption  of any new)  applicable  laws or
regulations,  or  any  change  in  the  interpretation  of  applicable  laws  or
regulations  by any  governmental  or other  regulatory  body  charged  with the
administration  thereof,  should  make it (or in the good faith  judgment of any
Bank cause a substantial  question as to whether it is) unlawful for any Bank to
make,  maintain or fund Eurodollar  Loans,  then such Bank shall promptly notify
each of the  other  parties  hereto  and,  so long as such  circumstances  shall
continue,  (a) such  Bank  shall  have no  obligation  to make or  convert  into
Eurodollar  Loans (but  shall make  Floating  Rate Loans  concurrently  with the
making of or  conversion  into  Eurodollar  Loans by the Banks  which are not so
affected,  in each case in an amount equal to such Bank's applicable  Percentage
of all  Eurodollar  Loans which would be made or converted  into at such time in
the  absence  of such  circumstances)  and (b) on the  last  day of the  current
Interest Period for each Eurodollar Loan of such Bank (or, in any event, on such
earlier  date  as  may  be  required  by  the  relevant   law,   regulation   or
interpretation),  such  Eurodollar  Loan  shall,  unless  then  repaid  in full,
automatically convert to a Floating Rate Loan. Each Floating Rate Loan made by a
Bank which, but for the circumstances described in the foregoing sentence, would
be a Eurodollar Loan (an "Affected Loan") shall remain  outstanding for the same
period as the Group of  Eurodollar  Loans of which such Affected Loan would be a
part absent such circumstances.

         8.4 Funding  Losses.  The Company hereby agrees that upon demand by any
Bank (which demand shall be accompanied  by a statement  setting forth the basis
for the  calculations  of the amount  being  claimed,  a copy of which  shall be
furnished  to the Agent) the Company  will  indemnify  such Bank against any net
loss or  expense  which  such  Bank may  sustain  or incur  (including,  without
limitation,  any net loss or expense  incurred by reason of the  liquidation  or
reemployment  of  deposits  or  other  funds  acquired  by such  Bank to fund or
maintain any  Eurodollar  Loan),  as  reasonably  determined  by such Bank, as a
result of (a) any payment or prepayment or conversion of any Eurodollar  Loan of
such Bank on a date other than the last day of an Interest  Period for such Loan
(including,  without limitation,  any conversion pursuant to Section 8.3) or (b)
any failure of the  Company to borrow or convert  any Loans on a date  specified
therefor in a notice of borrowing or conversion pursuant to this Agreement.  


                                      -29-


<PAGE>




For this purpose,  all notices to the Agent pursuant to this Agreement  shall be
deemed to be irrevocable.

         8.5 Right of Banks to Fund through Other Offices.  Each Bank may, if it
so elects, fulfill its commitment as to any Eurodollar Loan by causing a foreign
branch or affiliate of such Bank to make such Loan,  provided that in such event
for the purposes of this  Agreement  such Loan shall be deemed to have been made
by such  Bank and the  obligation  of the  Company  to  repay  such  Loan  shall
nevertheless  be to such Bank and shall be deemed  held by it, to the  extent of
such Loan, for the account of such branch or affiliate.

         8.6  Discretion of Banks as to Manner of Funding.  Notwithstanding  any
provision of this Agreement to the contrary, each Bank shall be entitled to fund
and  maintain  its funding of all or any part of its Loans in any manner it sees
fit, it being understood,  however,  that for the purposes of this Agreement all
determinations  hereunder  shall be made as if such Bank had actually funded and
maintained  each  Eurodollar  Loan  during  each  Interest  Period for such Loan
through  the  purchase  of  deposits  having a  maturity  corresponding  to such
Interest  Period and bearing an interest rate equal to the  Eurodollar  Rate for
such Interest Period.

         8.7    Conclusiveness   of   Statements;    Survival   of   Provisions.
Determinations  and  statements of any Bank pursuant to Section 8.1, 8.2, 8.3 or
8.4 shall be conclusive  absent  demonstrable  error.  Banks may use  reasonable
averaging and attribution methods in determining compensation under Sections 8.1
and 8.4, and the  provisions  of such Sections  shall  survive  repayment of the
Loans,  cancellation of the Notes,  cancellation or expiration of the Letters of
Credit and any termination of this Agreement.

SECTION 9 WARRANTIES.

         To induce Harris to issue Letters of Credit and to induce the Agent and
the Banks to enter into this Agreement and to induce the Banks to make Loans and
purchase participations in Letters of Credit hereunder, the Company warrants to
the Agent and the Banks that:

         9.1  Organization,  etc. The Company is a corporation  duly  organized,
validly  existing and in good standing  under the laws of the State of Delaware;
each Subsidiary is a corporation  duly organized,  validly  existing and in good
standing under the state of its incorporation;  and each of the Company and each
Subsidiary  is duly  qualified  to do  business in each  jurisdiction  where the
nature of its business makes such qualification necessary.


                                      -30-



<PAGE>


         9.2  Authorization;  No  Conflict.  The  execution  and delivery by the
Company of this  Agreement  and each other Loan Document to which it is a party,
the borrowings  hereunder,  the execution and delivery by each Guarantor of each
Loan Document to which it is a party and the  performance by each of the Company
and each Guarantor of its obligations  under each Loan Document to which it is a
party are within the corporate  powers of the Company and each  Guarantor,  have
been  duly  authorized  by all  necessary  corporate  action  on the part of the
Company and each Guarantor (including any necessary  shareholder  action),  have
received all necessary governmental approval (if any shall be required),  and do
not and will not (a)  violate  any  provision  of law or any  order,  decree  or
judgment of any court or other government agency which is binding on the Company
or any Guarantor, (b) contravene or conflict with, or result in a breach of, any
provision of the Certificate of Incorporation,  By-Laws or other  organizational
documents  of  the  Company  or any  Guarantor  or of  any  material  agreement,
indenture,  instrument or other  document,  or any material  judgment,  order or
decree,  which is binding on the Company,  any Guarantor or any other Subsidiary
or (c) result in, or  require,  the  creation or  imposition  of any Lien on any
property of the Company, any Guarantor or any other Subsidiary (other than Liens
arising under the Loan Documents).

         9.3 Validity and Binding Nature.  Each of this Agreement and each other
Loan  Document  to which the  Company is a party is, or upon the  execution  and
delivery  thereof  will be,  the  legal,  valid and  binding  obligation  of the
Company,  enforceable  against the Company in accordance with its terms,  except
that  enforceability  may  be  limited  by  bankruptcy,  insolvency,  fraudulent
conveyance,  fraudulent  transfer,  reorganization,  moratorium or other similar
laws now or hereafter in effect relating to creditors'  rights  generally and by
general  principles of equity  (regardless  of whether  enforcement is sought in
equity or at law);  and each Loan  Document to which any Guarantor is a party is
or upon the execution and delivery thereof by such Guarantor will be, the legal,
valid  and  binding  obligation  of such  Guarantor,  enforceable  against  such
Guarantor  in  accordance  with its terms,  except  that  enforceability  may be
limited by bankruptcy,  insolvency,  fraudulent conveyance, fraudulent transfer,
reorganization,  moratorium  or other  similar  laws now or  hereafter in effect
relating to  creditors'  rights  generally  and by general  principles of equity
(regardless of whether enforcement is sought in equity or at law).

         9.4  Financial   Information.   The  audited   consolidated   financial
statements of the Company and its Subsidiaries at July 1, 1995 and the unaudited
consolidated  financial  statements of the Company and its Subsidiaries at March
31, 1996,  copies of which have been delivered to each Bank,  have been prepared
in 


                                      -31-



<PAGE>



accordance with generally accepted  accounting  principles and present fairly
the consolidated  financial  condition of the Company and its Subsidiaries as at
such dates and the  results of their  operations  for the Fiscal Year and Fiscal
Quarter then ended.

         9.5  No  Material  Adverse  Change.  Since  the  date  of  the  audited
consolidated  financial statements described in Section 9.4, except as set forth
in Exhibit Q, no event or events have  occurred  which,  individually  or in the
aggregate, has had or is reasonably likely to have a Material Adverse Effect.

         9.6 Litigation and Contingent  Liabilities.  No litigation  (including,
without limitation,  derivative actions), arbitration proceeding or governmental
proceeding is pending or, to the  Company's  knowledge,  threatened  against the
Company or any Subsidiary which is reasonably  likely to have a Material Adverse
Effect  except as set forth in Exhibit B. Other than any  liability  incident to
such litigation or  proceedings,  neither the Company nor any Subsidiary has any
material  contingent  liabilities not provided for or disclosed in the financial
statements referred to in Section 9.4 or listed in Exhibit B.

         9.7  Ownership  of  Properties;  Liens.  Each of the  Company  and each
Subsidiary owns good and marketable title to, or a valid leasehold  interest in,
all of its properties and assets, real and personal, tangible and intangible, of
any nature whatsoever (including patents, trademarks, trade names, service marks
and  copyrights),  free and clear of all Liens,  charges  and claims  (including
infringement  claims with  respect to patents,  trademarks,  copyrights  and the
like) except as permitted pursuant to Section 10.7.

         9.8 Subsidiaries.  The Company has no Subsidiaries  except those listed
in Exhibit C.

         9.9 Pension  and Welfare  Plans.  Except as  disclosed  to the Banks in
writing prior to the Effective Date, during the twelve-consecutive-month  period
prior to the Effective  Date or the making of any Loan  hereunder,  (a) no steps
have been taken to terminate any Pension Plan which would be  reasonably  likely
to result in the Company being required to make a  contribution  to such Pension
Plan,  or incurring a liability or obligation to such Pension Plan, in excess of
$250,000,  and (b) no  contribution  failure has  occurred  with  respect to any
Pension Plan sufficient to give rise to a Lien under Section 302(f) of ERISA. No
condition  exists or event or  transaction  has  occurred  with  respect  to any
Pension Plan which could result in the incurrence by the Company of any material
liability, fine or penalty. Except as set forth on Exhibit D, the Company has no
contingent 

                                      -32-


<PAGE>



liability with respect to any post-retirement benefit under a Welfare
Plan,  other than  liability for  continuation  coverage  described in Part 6 of
subtitle B of title I of ERISA.

         9.10 Investment  Company Act. Neither the Company nor any Subsidiary is
an "investment  company" or a company  "controlled" by an "investment  company",
within the meaning of the Investment Company Act of 1940, as amended.

         9.11 Public Utility  Holding  Company Act.  Neither the Company nor any
Subsidiary  is a "holding  company",  or a  "subsidiary  company"  of a "holding
company",  or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.

         9.12 Regulation U. The Company is not engaged principally, or as one of
its important activities, in the business of extending credit for the purpose of
purchasing or carrying Margin Stock.

         9.13 Taxes. The United States federal income tax returns of the Company
for the Fiscal Year ended June 30, 1991 and for all Fiscal  Years ended prior to
such date are  "closed  years"  and are not  subject  to review by the  Internal
Revenue Service due to the running of the statute of limitations.  The Company's
tax years ended June 30, 1992,  June 30, 1993, July 2, 1994 and July 1, 1995 are
currently under  examination by the Internal  Revenue  Service.  The Company and
each  Subsidiary  has filed all tax returns and reports  required by law to have
been filed by it and has paid all taxes and governmental  charges required to be
paid,  except for any taxes or charges for which adequate reserves in accordance
with generally accepted accounting principles have been set aside on its books.

         9.14  Solvency,  etc.  On the  Effective  Date (or,  in the case of any
Person which  becomes a Guarantor  after the  Effective  Date,  on the date such
Person becomes a Guarantor), and immediately prior to and after giving effect to
the issuance of each Letter of Credit and each  borrowing  hereunder and the use
of the proceeds thereof,  (a) each of the Company's and each Guarantor's  assets
will exceed its  liabilities and (b) each of the Company and each Guarantor will
be solvent, will be able to pay its debts as they mature, will own property with
fair saleable  value greater than the amount  required to pay its debts and will
have capital sufficient to carry on its business as then constituted.

         9.15 Environmental Warranties. Except as disclosed in Exhibit E:



                                      -33-


<PAGE>


                  (a) all facilities and property owned or leased by the Company
         have  been,  and  continue  to be,  owned or leased by the  Company  in
         material compliance with all Environmental Laws;

                  (b) to the best knowledge of the Company, there have been no
         releases of Hazardous Materials at, on or under any property now or
         previously owned or leased by the Company that, singly or in the
         aggregate, have, or may reasonably be expected to have, a Material
         Adverse Effect;

                  (c) the Company has been issued and is in material compliance
         with all permits, certificates, approvals, licenses and other
         authorizations relating to environmental matters and necessary or
         desirable for its business;

                  (d) no real property owned, leased or operated by the Company
         or any Subsidiary has ever been used (by the Company or any Subsidiary
         or to the best of the Company's knowledge, by any other Person) as a
         site for intentional disposal of any Hazardous Material or a permanent
         storage site for any Hazardous Material;

                  (e) except in compliance with applicable law, neither the
         Company nor any Subsidiary nor, to the best of the Company's knowledge,
         any other Person has ever caused or permitted any Hazardous Material to
         be treated or stored on, under or at any real property owned, leased or
         operated by the Company or any Subsidiary; and

                  (f) the Company has not transported or arranged for the
         transportation of any Hazardous Materials to any location which is
         listed or proposed by regulation for listing in the National Priorities
         List pursuant to the Comprehensive Environmental Response, Compensation
         and Liability Act, or is listed on the Comprehensive Environmental
         Response Compensation Liability Information System List or any similar
         state list or which is the subject of any federal, state or local
         enforcement action or other investigation which, singly or in the
         aggregate, have, or may reasonably be expected to have, a Material
         Adverse Effect.

         9.16    Information.    All   written    information    heretofore   or
contemporaneously  herewith  furnished by the Company or any  Subsidiary  to any
Bank for purposes of or in connection  with this Agreement and the  transactions
contemplated hereby is, and all written information hereafter furnished by or on
behalf  of the  Company  or any  Subsidiary  to any Bank  pursuant  hereto or in
connection  herewith will be, true and accurate in every material 


                                      -34-


<PAGE>




respect on the date as of which such information is dated or certified, and none
of such  information  is or will be incomplete by omitting to state any material
fact necessary to make such information not misleading.

SECTION 10 COVENANTS.

         Until the expiration or termination of the Commitments and thereafter
until all obligations of the Company hereunder and under the other Loan
Documents are paid in full and all Letters of Credit have been terminated, the
Company agrees that, unless at any time the Required Banks shall otherwise
expressly consent in writing, it will:

         10.1 Reports, Certificates and Other Information.  Furnish to the Agent
with sufficient copies for each Bank:

         10.1.1 Audit  Report.  (a)  Promptly  when  available  and in any event
within 90 days after the close of each Fiscal  Year,  a copy of the annual audit
report of the  Company and its  Subsidiaries  for such  Fiscal  Year,  including
therein  consolidated  balance sheets of the Company and its  Subsidiaries as of
the end of such Fiscal Year and  consolidated  statements  of earnings  and cash
flow of the  Company and its  Subsidiaries  for such  Fiscal  Year,  which audit
report shall be without  qualification as to going concern or scope and shall be
prepared by Deloitte & Touche LLP or other  independent  auditors of  recognized
standing  selected  by the  Company  and  reasonably  acceptable  to the  Agent,
together  with a written  statement  from such  auditors  to the effect  that in
making  the  audit  necessary  for the  signing  of such  audit  report  by such
accountants,  they have not become  aware of any Event of  Default or  Unmatured
Event of Default  that has occurred  and is  continuing  or, if they have become
aware of any such event,  describing it in reasonable  detail;  and (b) promptly
when  available  and in any event  within 60 days after the close of each Fiscal
Year,  consolidated  and  consolidating  balance  sheets of the  Company and its
Subsidiaries  as  of  the  end  of  such  Fiscal  Year  and   consolidated   and
consolidating  statements of earnings for the Company and its  Subsidiaries  for
such Fiscal Year,  together with a certificate of the Chief  Executive  Officer,
the Chief Financial Officer or the Treasurer of the Company certifying that such
financial  statements  fairly  present the  financial  condition  and results of
operations  of the  Company  and its  Subsidiaries  as of the dates and  periods
indicated.

         10.1.2  Quarterly  Reports.  Promptly  when  available and in any event
within 30 days after the end of each  Fiscal  Quarter  (except  the last  Fiscal
Quarter) of each Fiscal Year,  consolidated and consolidating  balance sheets of
the  Company  and its  Subsidiaries  as of the end of such  Fiscal  Quarter  and


                                      -35-



<PAGE>




consolidated  and  consolidating  statements of earnings for such Fiscal Quarter
and for the period  beginning  with the first day of such Fiscal Year and ending
on the last day of such Fiscal Quarter and for the corresponding  Fiscal Quarter
of the  immediately  preceding  Fiscal Year,  together with a certificate of the
Chief Executive  Officer,  the Chief  Financial  Officer or the Treasurer of the
Company,  certifying that such financial statements fairly present the financial
condition and results of operations  of the Company and its  Subsidiaries  as of
the dates and periods  indicated,  subject to changes  resulting  from audit and
normal year-end adjustments.

         10.1.3 Monthly Reports. Promptly when available and in any event within
30 days after the end of each month of each Fiscal  Year  (except the last month
of each Fiscal  Quarter),  a financial  report  substantially in the form of the
monthly  reports  customarily  prepared  by the  Company  as of the date of this
Agreement,  including,  without  limitation,  a balance sheet and a statement of
earnings for such month and for the period  beginning with the first day of such
Fiscal  Year and ending on the last day of such month and for the  corresponding
month of the immediately  preceding Fiscal Year,  together with a certificate of
the Chief Executive Officer, the Chief Financial Officer or the Treasurer of the
Company,  certifying that such financial statements fairly present the financial
condition and results of operations  of the Company and its  Subsidiaries  as of
the dates and periods  indicated,  subject to changes  resulting  from audit and
normal year-end adjustments.

         10.1.4  Borrowing  Base  Certificate.  Furnish  to the Banks  within 10
Business  Days  after  the end of  each  month,  a  borrowing  base  certificate
substantially in the form of Exhibit L, together with an aging of Receivables by
Account Debtor (in the case of the 10 Account Debtors with the largest aggregate
amount of  outstanding  Receivables)  and in aggregate (in the case of all other
Account Debtors).

         10.1.5 Compliance  Certificates.  Contemporaneously with the furnishing
of a copy of each annual audit report pursuant to Section 10.1.1 and of each set
of quarterly statements pursuant to Section 10.1.2, a duly completed certificate
in the form of Exhibit F, with  appropriate  insertions,  dated the date of such
annual report or such  quarterly  statements  and signed by the Chief  Executive
Officer, the Chief Financial Officer or the Treasurer of the Company, containing
a computation of each of the financial ratios and restrictions set forth in this
Section 10 and to the effect that such officer has not become aware of any Event
of Default or Unmatured Event of Default that has occurred and is continuing or,
if there is any such event,  describing it and the steps, if any, being taken to
cure it.

                                      -36-



<PAGE>


         10.1.6 Reports to SEC and to Shareholders.  Promptly upon the filing or
sending  thereof,  a copy of (a) any  annual,  periodic  or  special  report  or
registration  statement (inclusive of exhibits thereto other than those exhibits
incorporated by reference therein) filed with the SEC or any securities exchange
and (b) any report,  proxy  statement or other  communication  to the  Company's
shareholders generally.

         10.1.7 Notice of Default,  Litigation and ERISA Matters.  Promptly (and
in any event  within three  Business  Days (or, in the case of clause (a) below,
one  Business  Day))  after  any  officer  of the  Company  learns of any of the
following,  written notice  describing the same and the steps being taken by the
Company  or the  Subsidiary  affected  thereby  with  respect  thereto:  (a) the
occurrence  of an Event of Default or an  Unmatured  Event of  Default;  (b) any
litigation,   arbitration  or  governmental   investigation  or  proceeding  not
previously  disclosed by the Company to the Banks which has been  instituted or,
to the  knowledge  of the  Company,  is  threatened  against  the Company or any
Subsidiary or to which any of the properties of any thereof is subject which has
had or is reasonably likely to have a Material Adverse Effect;  (c) any material
adverse development which occurs in any litigation,  arbitration or governmental
investigation or proceeding previously disclosed pursuant to clause (b); (d) the
institution of any steps by the Company,  any of its  Subsidiaries  or any other
Person  to  terminate  any  Pension  Plan,  or the  failure  to make a  required
contribution to any Pension Plan if such failure is sufficient to give rise to a
Lien under Section 302(f) of ERISA,  or the taking of any action with respect to
a Pension Plan which could result in the requirement  that the Company furnish a
bond or other  security to the PBGC or such Pension Plan,  or the  occurrence of
any event with respect to any Pension Plan which could result in the  incurrence
by the  Company of any  material  liability,  fine or penalty,  or any  material
increase  in  the  contingent  liability  of the  Company  with  respect  to any
post-retirement  Welfare Plan benefit; and (e) the occurrence of any other event
or circumstance which has had or is reasonably likely to have a Material Adverse
Effect.

         10.1.8  Subsidiaries.  Promptly upon the occurrence  thereof, a written
report of any change in the list of its Subsidiaries attached as Exhibit C.

         10.1.9  Management  Reports.  Promptly upon the request of the Agent or
any Bank, copies of all detailed  financial and management  reports submitted to
the Company by  independent  auditors in  connection  with any annual or interim
audit made by such auditors of the books of the Company.



                                      -37-



<PAGE>


         10.1.10  Other  Information.  Promptly  from time to time,  such  other
information concerning the Company and its Subsidiaries as any Bank or the Agent
may reasonably request.

         10.2 Books, Records and Inspections. Keep, and cause each Subsidiary to
keep,  its books  and  records  in  accordance  with  sound  business  practices
sufficient to allow the  preparation of financial  statements in accordance with
generally accepted accounting  principles;  permit, and cause each Subsidiary to
permit,  on reasonable  notice and at reasonable  times and intervals (or at any
time without notice during the existence of an Event of Default) any Bank or the
Agent or any representative  thereof to inspect the properties and operations of
the Company and of such  Subsidiary;  and permit,  and cause each  Subsidiary to
permit,  on reasonable  notice and at reasonable  times and intervals (or at any
time without notice during the existence of an Event of Default) any Bank or the
Agent or any  representative  thereof  to visit  any or all of its  offices,  to
discuss its  financial  matters with its officers and its  independent  auditors
(and the Company hereby  authorizes  such  independent  auditors to discuss such
financial matters with any Bank or the Agent or any representative thereof), and
to examine  (and,  at the expense of the Company or the  applicable  Subsidiary,
photocopy extracts from) any of its books or other corporate records.

         10.3 Insurance.  Maintain, and cause each Subsidiary to maintain,  with
reputable,  financially sound insurance companies,  insurance to such extent and
against such hazards and  liabilities as is customarily  maintained by companies
similarly  situated (and, in any event, such insurance as may be required by any
law or governmental  regulation or any court order or decree); and, upon request
of the  Agent or any  Bank,  furnish  to the  Agent or such  Bank a  certificate
setting  forth in  reasonable  detail the  nature  and  extent of all  insurance
maintained by the Company and its Subsidiaries.

         10.4  Compliance  with  Laws;  Payment  of Taxes and  Liabilities.  (a)
Comply,  and cause each Subsidiary to comply,  in all material respects with all
applicable  laws,  rules,  regulations and orders the  noncompliance  with which
would be reasonably  likely to have a Material Adverse Effect;  and (b) pay, and
cause  each  Subsidiary  to pay,  prior to  delinquency,  all  taxes  and  other
governmental charges against it or any of its property;  provided, however, that
the  foregoing  shall not require the Company or any  Subsidiary to pay any such
tax or charge so long as it shall contest the validity  thereof in good faith by
appropriate  proceedings and shall set aside on its books adequate reserves with
respect thereto in accordance with generally accepted accounting principles.



                                      -38-



<PAGE>


         10.5 Maintenance of Existence,  etc.  Maintain and preserve,  and cause
each Subsidiary to maintain and preserve, (a) its existence and good standing in
the  jurisdiction  of its  incorporation  and (b)  its  qualification  and  good
standing as a foreign  corporation in each jurisdiction  where the nature of its
business makes such qualification necessary.

         10.6 Financial Covenants.

         10.6.1  Minimum Net Worth.  Not permit Net Worth at any time to be less
than (a)  $27,500,000  plus (b) 50% of  Consolidated  Net  Income for the period
beginning  June 30, 1996 and ending on the last day of the most  recently  ended
Fiscal Quarter (excluding any loss for any Fiscal Quarter in such period).

         10.6.2  Minimum  Interest  Coverage.  Not permit the Interest  Coverage
Ratio for any Computation  Period,  beginning with the Computation Period ending
September 30, 1996, to be less than (i) 1.75 to 1.00 for each Computation Period
ending  prior to June 30,  1997,  (ii) 2.0 to 1.00 for each  Computation  Period
ending on or after June 30, 1997 but prior to June 30,  1998,  and (iii) 2.50 to
1.00 for each Computation Period ending on or after June 30, 1998.

         10.6.3  Debt  Ratio.  Not  permit  the Debt  Ratio as of the end of any
Fiscal  Quarter  to exceed (i) in the case of any  Fiscal  Quarter  ending on or
before  March 31,  1997,  3.75 to 1.00,  (ii) in the case of any Fiscal  Quarter
ending after March 31, 1997 but on or before March 31, 1998,  3.125 to 1.00, and
(iii) in the case of any Fiscal  Quarter  ending after March 31,  1998,  2.50 to
1.00.

         10.7 Liens.  Not, and not permit any Subsidiary to, create or permit to
exist any Lien on any of its real or  personal  properties,  assets or rights of
whatsoever  nature (whether now owned or hereafter  acquired),  except (a) Liens
for taxes or other governmental charges not at the time delinquent or thereafter
payable  without  penalty  or  being  contested  in good  faith  by  appropriate
proceedings  and, in each case, for which it maintains  adequate  reserves;  (b)
Liens arising in the ordinary course of business (such as (i) Liens of carriers,
warehousemen,  mechanics and  materialmen and other similar Liens imposed by law
and (ii) Liens incurred in connection with worker's  compensation,  unemployment
compensation  and other types of social security  (excluding Liens arising under
ERISA) or in connection with surety and appeal bonds,  bids,  performance  bonds
and similar  obligations)  for sums not overdue or being contested in good faith
by  appropriate  proceedings  and not  involving  any  deposits  or  advances or
borrowed money or the deferred  purchase price of property or services,  and, in
each case, for which it maintains  adequate  reserves;  (c) Liens  identified on
Exhibit G; (d) Liens 


                                      -39-



<PAGE>





in respect of Capital  Leases  entered  into in  connection
with,  or any Lien  arising  in  connection  with,  the  acquisition  of Capital
Expenditures  permitted  hereunder  and  attaching  only to the  property  being
acquired,  if the  Debt  secured  thereby  does  not  exceed  $3,000,000  in the
aggregate for all such Debt of the Company and all  Subsidiaries at any one time
outstanding;  (e)  attachments,  judgments and other similar Liens, for sums not
exceeding  $500,000 arising in connection with court  proceedings,  provided the
execution or other  enforcement of such Liens is  effectively  stayed and claims
secured  thereby are being  actively  contested in good faith and by appropriate
proceedings;  (f)  easements,  rights of way,  restrictions,  minor  defects  or
irregularities  in title and other similar Liens not interfering in any material
respect  with the  ordinary  conduct  of the  business  of the  Company  and its
Subsidiaries taken as a whole; (g) Liens in favor of the Agent arising under the
Loan Documents; (h) Liens securing obligations of a Subsidiary to the Company or
to a wholly-owned  Subsidiary;  and (i) extensions,  renewals or replacements of
any Lien permitted by the foregoing provisions of this Section 10.7, but only if
the  principal  amount of the Debt  secured  thereby  immediately  prior to such
extension, renewal or replacement is not increased and such Lien is not extended
to any other property.


         10.8  Limitations  on Debt.  Not,  and not  permit any  Subsidiary  to,
create,  incur,  assume or suffer to exist  any  Debt,  except  (a)  obligations
arising  under  the Loan  Documents;  (b)  Debt in  respect  of Liens  permitted
pursuant to Section 10.7(d); (c) Debt of Subsidiaries to the Company or to other
Subsidiaries;  (d) liabilities in respect of Hedging  Agreements entered into by
the Company or any  Subsidiary;  (e)  Contingent  Liabilities  in respect of any
obligation of the Company or any Subsidiary permitted under this Agreement;  (f)
Debt in respect of taxes, assessments or governmental charges to the extent that
payment  thereof shall not at the time be required to be made in accordance with
Section  10.4;  (g) Debt in respect of judgments or awards not  constituting  an
Event of Default under Section  12.1.8;  (h) other Debt  outstanding on the date
hereof and listed in Exhibit H or hereafter  incurred in  connection  with Liens
permitted by Section 10.7, (i) other Debt at any time  outstanding,  in addition
to Debt  permitted by clauses (a) through (h), not  exceeding  $1,000,000 at any
time  outstanding,  and (j)  extensions,  renewals and  refinancings of any Debt
described in clauses (b), (h) or (i) so long as the principal  amount thereof is
not increased and is on terms,  in the aggregate,  not materially less favorable
to the  Company  or such  Subsidiary  than the terms of such Debt  prior to such
extension, renewal or refinancing.

         10.9 Guaranties.  Not, and not permit any Subsidiary to, 


                                      -40-


<PAGE>



become or be a guarantor or surety of, or otherwise  become or be responsible in
any manner  (whether by agreement to purchase any  obligations,  stock,  assets,
goods or services,  or to supply any assets,  goods or services,  or  otherwise)
for, any obligations of any other Person, except for (i) the endorsement, in the
ordinary course of collection,  of instruments payable to it or to its order and
(ii) the Guaranty.

         10.10 Mergers and Consolidations; Acquisitions. Not, and not permit any
Subsidiary  to,  be a party to any  merger  or  consolidation,  or  purchase  or
otherwise  acquire  all or  substantially  all of the assets or any stock of any
class of, or any  partnership  or joint  venture  interest in, any other Person,
except (a) any such merger or consolidation of or by any wholly-owned Subsidiary
into the Company or any Guarantor, (b) any such purchase or other acquisition by
the  Company  or any  Guarantor  of the  assets  or  stock  of any  wholly-owned
Subsidiary,  and (c) any other merger,  purchase or  acquisition  by the Company
provided  that (i) in the case of any such merger,  the Company is the surviving
entity, (ii) the consideration (including,  without limitation, any Debt assumed
by the Company in connection with such merger,  purchase or acquisition but less
any cash acquired by the Company in connection with any such merger, purchase or
acquisition)  paid for such stock or assets or in  connection  with such  merger
shall not exceed $3,000,000 in the aggregate for all such mergers, purchases and
acquisitions  in any Fiscal Year and  $5,000,000  in the  aggregate for all such
mergers, purchases and acquisitions during the term of this Agreement, and (iii)
no Event of  Default  or  Unmatured  Event of  Default  exists  or would  result
therefrom.

         10.11 Asset Dispositions.  Not, and not permit any Subsidiary to, sell,
transfer,  convey, lease or otherwise dispose of, or grant options,  warrants or
other  rights with  respect to, any of its assets,  or sell,  assign,  pledge or
otherwise  transfer  any  receivables,  contract  rights,  general  intangibles,
chattel paper or instruments,  with or without recourse,  except the disposition
of inventory or obsolete  assets in the ordinary  course of business  consistent
with past practices.

         10.12 Capital Expenditures. Not, and not permit any Subsidiary to, make
or commit to make any  Capital  Expenditure  in any Fiscal  Year  unless,  after
giving effect to such Capital  Expenditure,  the aggregate amount of all Capital
Expenditures  made by the Company and its  Subsidiaries  during such Fiscal Year
(less,  in the  case  of  Capital  Expenditures  incurred  to  replace  existing
equipment  of the Company or any  Subsidiary,  an amount  equal to the amount of
proceeds  received  by the  Company  or such  


                                      -41-


<PAGE>



Subsidiary  from the sale of such  replaced  equipment  within six months of the
acquisition of such  replacement  equipment)  shall not exceed (a) $2,500,000 in
Fiscal Year 1997 and (b) $3,500,000 for each Fiscal Year thereafter.

         10.13 Restricted  Payments.  Not, and not permit any Subsidiary to, (a)
declare or pay any  dividends  on any of its  capital  stock  (other  than stock
dividends),  (b) purchase or redeem any such stock or any  warrants,  options or
other  rights in  respect  of such  stock,  (c) make any other  distribution  to
shareholders  (other than the issuance of stock, or options in respect  thereof,
to  directors,  officers  and  employees),  (d)  prepay,  purchase or redeem any
subordinated  Debt or (e) set aside funds for any of the  foregoing  (any of the
foregoing, a "Restricted Payment"); provided that (i) any Subsidiary may declare
and pay dividends to the Company or to another wholly-owned Subsidiary; and (ii)
so long as (x) no Event of Default or Unmatured Event of Default exists or would
result  therefrom,  (y) the Debt  Ratio is less than 2.50 to 1.00 as of the last
day of the Fiscal  Quarter most  recently  ended and (z) after giving  effect to
such  Restricted  Payment,  the sum of all  Restricted  Payments  made since the
Effective  Date will be equal to or less than the sum of (A) 50% of Excess  Cash
for the period from the first date on which the Debt Ratio was less than 2.50 to
1.00 to the last day of the  Fiscal  Quarter  most  recently  ended plus (B) the
aggregate  net cash  proceeds  from the  issuance of common stock by the Company
since the Effective Date, then the Company may make any Restricted Payments.

         10.14  Modification  of  Organizational   Documents.   Not  permit  the
Certificate of Incorporation,  By-Laws or other organizational  documents of the
Company  or any  Subsidiary  to be amended or  modified  in any way which  would
materially adversely affect the interests of the Banks.

         10.15 Use of Proceeds. Use the proceeds of the Loans solely for general
corporate  purposes  and to repay Debt to be  Repaid;  and not use or permit any
proceeds of any Loan to be used, either directly or indirectly, for the purpose,
whether  immediate,  incidental  or ultimate,  of  "purchasing  or carrying" any
Margin Stock.

         10.16 Further Assurances. Take, and cause each Subsidiary to take, such
actions  as the  Agent may  reasonably  request  from  time to time  (including,
without  limitation,   the  execution  and  delivery  of  guaranties,   security
agreements,  pledge  agreements,   mortgages,  financing  statements  and  other
documents,  the filing or recording of any of the foregoing, and the delivery of
stock  


                                      -42-

<PAGE>



certificates  and other  collateral  with respect to which  perfection is
obtained  by  possession)  to ensure  that (i) the  obligations  of the  Company
hereunder and under the other Loan Documents are secured by substantially all of
the assets of the  Company and  guarantied  by all  Subsidiaries  of the Company
(including,  promptly upon the acquisition or creation  thereof,  any Subsidiary
acquired  or created  after the date  hereof) and (ii) the  obligations  of each
Subsidiary under the Guaranty are secured by substantially  all of the assets of
such Subsidiary.

         10.17 Transactions with Affiliates.  Not, and not permit any Subsidiary
to, enter into, or cause, suffer or permit to exist any transaction, arrangement
or  contract  with any of its other  Affiliates  (other than the Company and its
Subsidiaries)  which is on terms which are less  favorable  than are  obtainable
from any Person which is not one of its Affiliates.

         10.18 Employee  Benefit Plans.  Maintain,  and cause each Subsidiary to
maintain,  each Pension Plan in compliance  with all applicable  requirements of
law and regulations.

         10.19 Lease Rentals. Not, and not permit any Subsidiary to, enter into,
or  permit to remain in effect  any  operating  lease for the  leasing  by it as
lessee of any real or personal property (or any interest therein) which requires
the payment by the Company and its  Subsidiaries  of amounts of rental in excess
of an aggregate,  for all such leases of the Company and its Subsidiaries at any
one time outstanding, of $2,500,000 in any Fiscal Year.

         10.20 Environmental Covenants.

         10.20.1 Environmental  Response Obligation.  (a) Comply, and cause each
Subsidiary to comply, with any Federal or state judicial or administrative order
requiring the performance at any real property owned,  operated or leased by the
Company or any Subsidiary of activities in response to the release or threatened
release of a Hazardous Material,  except for the period of time that the Company
or such Subsidiary is diligently in good faith contesting such order; (b) notify
the Agent and each Bank  within ten days of the  receipt of any  written  claim,
demand,  proceeding,  action or notice of liability by any Person arising out of
or relating to the release or threatened  release of a Hazardous  Material;  and
(c) notify the Agent and each Bank  within  ten days of any  release,  threat of
release,  or  disposal  of  Hazardous  Material  reported  by the Company or any
Subsidiary  to any  governmental  or  regulatory  authority at any real property
owned, operated, or leased by the Company or any Subsidiary.



                                      -43-


<PAGE>


         10.20.2   Environmental   Liabilities.   (a)  Comply,  and  cause  each
Subsidiary to comply, in all material  respects with all material  Environmental
Laws; (b) without  limiting  clause (a), not commence  disposal of any Hazardous
Material into or onto any real property owned, operated or leased by the Company
or any  Subsidiary;  and (c) without  limiting  clause  (a),  not allow any Lien
imposed pursuant to any law, regulation or order relating to Hazardous Materials
or the disposal thereof to remain on any real property owned, operated or leased
by the Company or any Subsidiary.

         10.21  Unconditional  Purchase  Obligations.  Not,  and not  permit any
Subsidiary  to,  enter into or be a party to any  contract  for the  purchase of
materials,  supplies or other  property or services,  if such contract  requires
that payment be made by it regardless of whether or not delivery is ever made of
such materials, supplies or other property or services.

         10.22  Maintenance  of  Properties.  Maintain,  and  cause  each of its
Subsidiaries to maintain, its equipment, improvements and other property in good
repair,  working order and condition,  ordinary wear and tear excepted, and will
make,  and  cause  each  Subsidiary  to make,  such  repairs,  replacements  and
additions as may be necessary to maintain such condition.

         10.23  Investments.  The  Company  will  not,  nor will it  permit  any
Subsidiary  to, make,  incur,  assume or suffer to exist any  Investment  in any
other Person, except:

                  (a)  Investments existing on the Effective Date and identified
         in Exhibit P;

                  (b)  Cash Equivalent Investments;

                  (c) Investments by the Company in its Subsidiaries or by any
         Subsidiary in any other Subsidiary, in the form of contributions to
         capital or loans or advances; provided that, immediately before or
         after giving effect to such Investment, no Event of Default or
         Unmatured Event of Default shall have occurred and be continuing;

                  (e)  loans or advances made by any Subsidiary to the Company; 
         and

                  (f) advances not to exceed, in the aggregate for the Company
         and all Subsidiaries at any one time outstanding, $250,000 to officers
         and employees in connection with 


                                      -44-


<PAGE>

         travel, housing and other expenses in the ordinary course of business.

         10.24  Interest  Rate  Protection.  Within 30 days after the  Effective
Date,  enter into and maintain one or more  interest  rate swaps,  interest rate
caps or similar  arrangements with counterparties  reasonably  acceptable to the
Agent,  which  arrangements will ensure that the effective  interest rate (after
taking account of such  arrangements) will not exceed 10% per annum with respect
to not less than  $12,500,000  of the Term  Loans at any time  prior to June 30,
1998.

         10.25 Hedging Agreements.  Not, and not permit any Subsidiary to, enter
into any  Hedging  Agreement  other than any  Hedging  Agreement  required to be
entered into pursuant to Section 10.24.

         10.26 Other  Agreements.  Not, and not permit any  Subsidiary to, enter
into any agreement  containing any provision which would restrict the ability of
the  Company  or any  Subsidiary  to grant a Lien on any of its  assets or which
would be violated or breached by any  borrowing  by the Company  hereunder or by
the  performance  by the  Company or any  Subsidiary  of any of its  obligations
hereunder or under any other Loan Document.

SECTION 11 CONDITIONS TO EFFECTIVENESS; CONDITIONS OF LENDING.

         The effectiveness of this Agreement and the obligation of each Bank to
make any Loan and of Harris to issue any Letter of Credit is subject to the
following conditions precedent:

         11.1 Effective Date. The  effectiveness of this Agreement is subject to
the  conditions  precedent  and  concurrent  (and  the  date on  which  all such
conditions  precedent and concurrent have been satisfied or waived in writing by
the Banks is called the "Effective Date") that the Agent shall have received, on
or prior to the Effective  Date,  all of the  following,  each duly executed and
dated the Effective Date (or such earlier date as shall be  satisfactory  to the
Agent),  in form and substance  satisfactory to the Agent,  and each (except for
the Notes, of which only the originals shall be signed) in sufficient  number of
signed counterparts to provide one for each Bank:

         11.1.1 Notes. The Notes.

         11.1.2  Resolutions.  Certified  copies of  resolutions of the Board of
Directors of the Company  authorizing or ratifying the  

                                      -45-


<PAGE>


execution,  delivery and performance by the Company of this Agreement, the Notes
and the other Loan  Documents  to which the  Company is a party;  and  certified
copies of resolutions of the Board of Directors of each Guarantor authorizing or
ratifying the execution, delivery and performance by such Guarantor of each Loan
Document to which such Guarantor is a party.

         11.1.3 Consents,  etc. Certified copies of all documents evidencing any
necessary  corporate  action,  consents  and  governmental  approvals  (if  any)
required for the  execution,  delivery and  performance of the Loan Documents by
the Company and each Guarantor.

         11.1.4  Incumbency  and Signature  Certificates.  A certificate  of the
Secretary or an Assistant Secretary of the Company and each Guarantor certifying
the names of the officer or officers of such entity  authorized to sign the Loan
Documents  to which such entity is a party,  together  with a sample of the true
signature of each such officer (it being understood that the Agent and each Bank
may conclusively  rely on each such certificate until formally advised by a like
certificate of any changes therein).

         11.1.5 Guaranty. A guaranty (as amended or otherwise modified from time
to time, the  "Guaranty"),  substantially  in the form of Exhibit K, executed by
each Guarantor.

         11.1.6 Security Agreement.  A security agreement,  substantially in the
form of  Exhibit  M,  issued by the  Company  and each  Guarantor  (as  amended,
supplemented or otherwise modified from time to time, the "Security Agreement"),
together  with  evidence,  satisfactory  to the Agent,  that  substantially  all
filings  necessary to perfect the Agent's Lien on any  collateral  granted under
the Security Agreement have been duly made and are in full force and effect.

         11.1.7 Pledge Agreements. (a) A pledge agreement,  substantially in the
form of Exhibit  N-1,  issued by the Company (as amended or  otherwise  modified
from time to time, the "Company Pledge Agreement").

         (b) A pledge agreement substantially in the form of Exhibit N-2, issued
by Niemand Holdings,  Inc. (as amended or otherwise  modified from time to time,
the "Subsidiary Pledge Agreement").

         11.1.8 Mortgages. Mortgages, each in form and substance satisfactory to
the Agent  (and  together  with such other  documents,  such as  surveys,  title
reports and title insurance 


                                      -46-


<PAGE>



policies,  as the  Agent  may  reasonably  request),  with  respect  to the real
property of the Company and the Guarantors listed in Exhibit O.

         11.1.9 Evidence of the Payment of Debt to be Repaid; Releases. Evidence
that all Debt to be Repaid,  together with all interest, all prepayment premiums
(if any) and all other amounts due and payable with respect thereto,  shall have
been paid in full (including,  to the extent necessary, from the proceeds of the
initial Loans),  together with all releases and other  instruments  necessary to
release all Liens securing payment of any such Debt to be Repaid.

         11.1.10  Insurance   Certificate.   A  certificate   setting  forth  in
reasonable  detail  the nature and  extent of all  insurance  maintained  by the
Company and its Subsidiaries.

         11.1.11  Opinions of Counsel for the  Company and the  Guarantors.  The
opinions  of (a)  Kohrman  Jackson  & Krantz,  counsel  to the  Company  and the
Guarantors,  substantially in the form of Exhibit I-1, (b) Robinson,  Bradshaw &
Hinson,  P.A.,  North  Carolina  counsel  to the  Company  and  the  Guarantors,
substantially  in the form of  Exhibit  I-2,  (c)  Dunmire,  Fisher &  Hastings,
Nebraska counsel to the Company and the Guarantors, substantially in the form of
Exhibit  I-3,  (d)  Lewis &  Kappes,  Indiana  counsel  to the  Company  and the
Guarantors,  substantially in the form of Exhibit I-4, and (e) Robison & Belser,
P.A.,  Alabama counsel to the Company and the Guarantors,  substantially  in the
form of Exhibit I-5.

         11.1.12  Other.  Such  other  documents  as the  Agent  or any Bank may
reasonably request.

         11.2 All Loans and Letters of Credit.  The  obligation  of each Bank to
make each Loan and of Harris to issue  each  Letter of Credit is  subject to the
following further conditions precedent that:

         11.2.1 No Default,  etc. (a) No Event of Default or Unmatured  Event of
Default has  occurred and is  continuing  or will result from the making of such
Loan or the issuance of such Letter of Credit, (b) the warranties of the Company
contained  in Section 9 are true and  correct  as of the date of such  requested
Loan or Letter of Credit,  with the same  effect as though made on such date and
(c) since the date of the audited consolidated financial statements described in
Section  9.4 or,  if later,  the date of the most  recent  financial  statements
delivered to the Banks pursuant to Section 10.1.1,  10.1.2,  or 10.1.3, no event
has 

                                      -47-


<PAGE>



occurred or condition exists that results in a Material Adverse Effect.

         11.2.2  Confirmatory  Certificate.  The Agent shall have  received  (in
sufficient  counterparts to provide one to each Bank), if requested by the Agent
or any Bank, a certificate  dated the date of such  requested  Loan or Letter of
Credit and signed by a duly authorized  representative  of the Company as to the
matters set out in Section 11.2.1 (it being  understood that each request by the
Company for the making of a Loan or the  issuance of a Letter of Credit shall be
deemed to constitute a warranty by the Company that the conditions precedent set
forth in Section 11.2.1 will be satisfied at the time of the making of such Loan
or the issuance of such Letter of Credit), together with such other documents as
the Agent or any Bank may reasonably request in support thereof.

SECTION 12 EVENTS OF DEFAULT AND THEIR EFFECT.

         12.1 Events of Default. Each of the following shall constitute an Event
of Default under this Agreement:

         12.1.1  Non-Payment of the Loans,  etc. Default in the payment when due
of the principal of any Loan; or default, and continuance thereof for five days,
in the payment when due of any interest,  fees,  reimbursement  obligation  with
respect  to any  Letter  of  Credit  or other  amounts  payable  by the  Company
hereunder or under any other Loan Document.

         12.1.2  Non-Payment  of Other Debt.  Any default  shall occur under the
terms  applicable  to any Debt of the Company or any  Subsidiary in an aggregate
amount (for all Debt so affected)  exceeding  $1,000,000  and such default shall
(a) consist of the failure to pay such Debt when due (subject to any  applicable
grace  period),  whether by  acceleration  or otherwise,  or (b)  accelerate the
maturity of such Debt or permit the holder or holders thereof, or any trustee or
agent for such holder or  holders,  to cause such Debt to become due and payable
prior to its expressed maturity.

         12.1.3 Other Material Obligations.  Default in the payment when due, or
in the  performance or observance  of, any material  obligation of, or condition
agreed to by,  the  Company  or any  Subsidiary  with  respect  to any  material
purchase  or lease of goods or  services  (except  only to the  extent  that the
existence  of any  such  default  is  being  contested  by the  Company  or such
Subsidiary  in good  faith  and by  appropriate  proceedings  and all  necessary
reserves,  if any,  have  been  made in  respect  of such  


                                      -48-


<PAGE>


default) if, in the reasonable  judgment of the Required Banks, such default has
had, or is reasonably likely to have, a Material Adverse Effect.

         12.1.4  Bankruptcy,  Insolvency,  etc.  The  Company  or any  Guarantor
becomes  insolvent or generally fails to pay, or admits in writing its inability
or refusal to pay,  debts as they become  due;  or the Company or any  Guarantor
applies  for,  consents  to, or  acquiesces  in the  appointment  of a  trustee,
receiver or other  custodian  for the Company or such  Guarantor or any property
thereof, or makes a general assignment for the benefit of creditors;  or, in the
absence of such  application,  consent or acquiescence,  a trustee,  receiver or
other  custodian  is  appointed  for  the  Company  or  any  Guarantor  or for a
substantial part of the property of any thereof and is not discharged  within 30
days; or any  bankruptcy,  reorganization,  debt  arrangement,  or other case or
proceeding  under any  bankruptcy  or  insolvency  law,  or any  dissolution  or
liquidation  proceeding  (except  the  voluntary  dissolution,   not  under  any
bankruptcy or insolvency  law, of a Subsidiary),  is commenced in respect of the
Company or any Guarantor, and if such case or proceeding is not commenced by the
Company or such Guarantor, it is consented to or acquiesced in by the Company or
such  Guarantor,  or  remains  for 30 days  undismissed;  or the  Company or any
Guarantor takes any corporate action to authorize,  or in furtherance of, any of
the foregoing.

         12.1.5 Non-Compliance with Provisions of This Agreement. Failure by the
Company to comply with or to perform  any  covenant  set forth in Sections  10.6
through  10.15,  Section  10.19 and  Section  10.23 or failure by the Company to
comply  with or to  perform  any  other  provision  of this  Agreement  (and not
constituting  an Event of  Default  under  any of the other  provisions  of this
Section 12) and  continuance of such failure for 30 days after notice thereof to
the Company from the Agent or any Bank.

         12.1.6  Warranties.  Any warranty  made by the Company or any Guarantor
herein or in any other Loan  Document is breached or is false or  misleading  in
any material respect, or any schedule, certificate, financial statement, report,
notice or other  writing  furnished by the Company or any Guarantor to the Agent
or any Bank is false or  misleading  in any  material  respect on the date as of
which the facts therein set forth are stated or certified.

         12.1.7  Pension Plans.  (i)  Institution of any steps by the Company or
any other Person to terminate a Pension Plan if as a result of such  termination
the Company  could be required to make a  contribution  to such Pension Plan, or
could  incur a  liability  


                                      -49-


<PAGE>



or  obligation  to  such  Pension  Plan,  in  excess  of  $500,000,  or  (ii)  a
contribution  failure occurs with respect to any Pension Plan sufficient to give
rise to a Lien under section 302(f) of ERISA.

         12.1.8  Judgments.   Final  judgments  which  exceed  an  aggregate  of
$1,000,000  (excluding any portion thereof which is covered by insurance so long
as the insurer is reasonably  likely to be able to pay and has accepted a tender
of defense and indemnification  without reservation of rights) shall be rendered
against  the Company or any  Subsidiary  and shall not have been  discharged  or
vacated or had  execution  thereof  stayed  pending  appeal within 30 days after
entry or filing of such judgments.

         12.1.9  Invalidity of Guaranty,  etc. The Guaranty shall cease to be in
full force and effect with respect to any  Guarantor,  any Guarantor  shall fail
(subject  to any  applicable  grace  period) to comply  with or to  perform  any
applicable  provision  of the  Guaranty,  or any  Guarantor  (or any  Person by,
through  or on  behalf  of such  Guarantor)  shall  contest  in any  manner  the
validity,  binding nature or enforceability of the Guaranty with respect to such
Guarantor.

         12.1.10  Invalidity  of  Collateral  Documents,   etc.  Any  Collateral
Document  shall cease to be in full force and effect with respect to the Company
or any  Guarantor,  the  Company or any  Guarantor  shall fail  (subject  to any
applicable  grace period) to comply with or to perform any applicable  provision
of any  Collateral  Document to which such entity is a party,  or the Company or
any  Guarantor  (or any Person by,  through or on behalf of the  Company or such
Guarantor)  shall  contest  in  any  manner  the  validity,  binding  nature  or
enforceability of any Collateral Document.

         12.1.11 Change of Control. A Change of Control shall have occurred.

         12.2 Effect of Event of Default.  If any Event of Default  described in
Section  12.1.4  shall  occur,  the  Commitments  (if they have not  theretofore
terminated) shall immediately  terminate and the Notes and all other obligations
hereunder shall become  immediately due and payable and the Company shall become
immediately obligated to deliver to the Agent cash collateral in an amount equal
to  the  outstanding  face  amount  of  all  Letters  of  Credit,   all  without
presentment,  demand,  protest  or notice of any kind;  and,  in the case of any
other Event of Default,  the Agent may (and upon written request of the Required
Banks shall) declare the Commitments  (if they have not theretofore  terminated)



                                      -50-


<PAGE>




to be terminated and/or declare all Notes and all other obligations hereunder to
be due and payable  and/or  demand that the Company  immediately  deliver to the
Agent cash collateral in an amount equal to the  outstanding  face amount of all
Letters of  Credit,  whereupon  the  Commitments  (if they have not  theretofore
terminated)  shall  immediately   terminate  and/or  all  Notes  and  all  other
obligations  hereunder  shall  become  immediately  due and  payable  and/or the
Company  shall  immediately  become  obligated  to  deliver  to the  Agent  cash
collateral  in an amount equal to the face amount of all Letters of Credit,  all
without  presentment,  demand,  protest or notice of any kind.  The Agent  shall
promptly advise the Company of any such declaration,  but failure to do so shall
not impair the effect of such declaration.  Notwithstanding  the foregoing,  the
effect  as an Event of  Default  of any event  described  in  Section  12.1.1 or
Section 12.1.4 may be waived by the written concurrence of all of the Banks, and
the effect as an Event of Default of any other event  described  in this Section
12 may be waived by the written  concurrence  of the  Required  Banks.  Any cash
collateral delivered hereunder shall be held by the Agent (without liability for
interest  thereon) and applied to  obligations  arising in  connection  with any
drawing under a Letter of Credit.  After the  expiration or  termination  of all
Letters of  Credit,  such cash  collateral  shall be applied by the Agent to any
remaining obligations hereunder and any excess shall be delivered to the Company
or as a court of competent jurisdiction may direct.

SECTION 13 THE AGENT.

         13.1 Authorization.  Each Bank authorizes the Agent to act on behalf of
such Bank to the extent  provided  herein or in any other Loan  Document  or any
other document or instrument delivered hereunder or in connection herewith,  and
to take such other action as may be reasonably incidental thereto.

         13.2  Indemnification.  Each Bank agrees to reimburse and indemnify the
Agent  for,  and  hold  the  Agent  harmless  against,  a share  (determined  in
accordance with the percentage  which (x) the sum of (A) the  participations  in
all Letters of Credit of such Bank plus (B) the principal amount of the Loans of
such Bank is of (y) the sum of (A) the  Stated  Amount of all  Letters of Credit
plus (B) the  aggregate  principal  amount of all  Loans)  of any loss,  damage,
penalty, action, judgment, obligation, cost, disbursement,  liability or expense
(including  attorneys'  fees)  incurred  without  gross  negligence  or  willful
misconduct  on the part of the Agent  arising out of or in  connection  with the
performance of its obligations or the exercise of its powers  hereunder or under
any other Loan Document or any other document 



                                      -51-


<PAGE>



or  instrument  delivered  hereunder or in connection  herewith,  as well as the
costs and  expenses of  defending  against any claim  against the Agent  arising
hereunder or thereunder.

         13.3  Exculpation.  The Agent  shall be entitled to rely upon advice of
counsel  concerning  legal  matters,  and upon this  Agreement,  any other  Loan
Document  and any  schedule,  certificate,  statement,  report,  notice or other
writing  which it believes to be genuine or to have been  presented  by a proper
person.  Neither  the Agent nor any of its  directors,  officers,  employees  or
agents  shall (i) be  responsible  for any recital,  representation  or warranty
contained in, or for the  execution,  validity,  genuineness,  effectiveness  or
enforceability  of,  this  Agreement,  any  other  Loan  Document  or any  other
instrument or document delivered  hereunder or in connection  herewith,  (ii) be
responsible   for  the   validity,   genuineness,   perfection,   effectiveness,
enforceability,  existence,  value or enforcement  of any  collateral  security,
(iii)  be under  any  duty to  inquire  into or pass  upon any of the  foregoing
matters, or to make any inquiry concerning the performance by the Company or any
other obligor of its  obligations,  or (iv) in any event,  be liable as such for
any action  taken or  omitted  by it or them,  except for its or their own gross
negligence  or willful  misconduct.  The agency  hereby  created shall in no way
impair or affect  any of the  rights  and  powers  of, or impose  any  duties or
obligations upon, the Agent in its individual capacity.

         13.4 Credit Investigation. Each Bank acknowledges that it has made such
inquiries  and taken such care on its own behalf as would have been the case had
such Bank's Commitments been granted, the Letters of Credit been issued and such
Bank's  Loans  been  made  directly  by such  Bank to the  Company  without  the
intervention of the Agent or any other Bank.  Each Bank agrees and  acknowledges
that the Agent makes no representation or warranty about the creditworthiness of
the Company or any other party to this  Agreement or any other Loan  Document or
with respect to the legality,  validity,  sufficiency or  enforceability of this
Agreement or any other Loan Document or the value of any security therefor.

         13.5 Agent and Affiliates.  The Agent in its individual  capacity shall
have the same rights and powers  hereunder as any other Bank and may exercise or
refrain from exercising the same as though it were not the Agent,  and the Agent
and its Affiliates may accept deposits from and generally  engage in any kind of
business with the Company or any Affiliate  thereof as if the Agent were not the
Agent hereunder.


                                      -52-


<PAGE>




         13.6 Action on  Instructions  of the Required  Banks. As to any matters
not expressly  provided for by this Agreement  (including,  without  limitation,
enforcement  of any Loan Document or  collection of the Loans),  the Agent shall
not be required to exercise  any  discretion  or take any action,  but the Agent
shall in all cases be fully  protected in acting or refraining  from acting upon
the written  instructions  from (i) the Required Banks,  except for instructions
which under the express provisions hereof must be received by the Agent from all
Banks,  and (ii) in the case of such  instructions,  from all Banks. In no event
will the  Agent be  required  to take any  action  which  exposes  the  Agent to
personal  liability  or which is  contrary  to this  Agreement,  any other  Loan
Document or applicable law. The relationship  between the Agent and the Banks is
and shall be that of agent and principal only and nothing herein contained shall
be construed to  constitute  the Agent a trustee for any Bank or any holder of a
participation  in any Loan nor to  impose on the Agent  duties  and  obligations
other than those expressly provided for herein.

         13.7 Funding Reliance. (a) Unless the Agent receives notice from a Bank
by 11:00 a.m.,  Chicago time, on the day of a proposed  borrowing that such Bank
will not make  available  to the Agent the amount  which  would  constitute  its
Percentage  of such  borrowing  in  accordance  with  Section 2.3, the Agent may
assume  that such Bank has made  such  amount  available  to the Agent  and,  in
reliance upon such  assumption,  make a  corresponding  amount  available to the
Company.  If and to the extent such Bank has not made any such amount  available
to the Agent,  such Bank and the Company  jointly and  severally  agree to repay
such amount to the Agent forthwith on demand,  together with interest thereon at
the interest rate applicable to Loans comprising such borrowing (or, in the case
of any Bank which repays such amount  within three  Business  Days,  the Federal
Funds Rate).  Nothing set forth in this clause (a) shall relieve any Bank of any
obligation it may have to make any Loan hereunder.

         (b) Unless the Agent receives notice from the Company prior to the due
date for any payment hereunder that the Company does not intend to make such
payment, the Agent may assume that the Company has made such payment and, in
reliance upon such assumption, make available to each Bank its share of such
payment. If and to the extent that the Company has not made any such payment to
the Agent, each Bank which received a share of such payment shall repay such
share (or the relevant portion thereof) to the Agent forthwith on demand,
together with interest thereon at the Federal Funds Rate. Nothing set forth in
this clause (b) shall relieve the Company of any obligation it may have to make
any payment hereunder.


                                      -53-


<PAGE>


         13.8  Resignation.  The  Agent  may  resign as such at any time upon at
least 30 days' prior  notice to the  Company and the Banks.  In the event of any
such resignation,  the Required Banks shall as promptly as practicable appoint a
successor  Agent. If no successor  shall have been so appointed,  and shall have
accepted  such  appointment,  within 30 days  after the giving of notice of such
resignation,  then the  retiring  Agent may,  on behalf of the Banks,  appoint a
successor  Agent,  which shall be a commercial  bank organized under the laws of
the United States of America  having a combined  capital,  surplus and undivided
profits of at least  $500,000,000.  Upon the  acceptance of any  appointment  as
Agent  hereunder by a successor  Agent,  such  successor  Agent shall  thereupon
succeed to and become vested with all rights,  powers,  privileges and duties of
the retiring Agent,  and the retiring Agent shall be discharged from all further
duties and obligations under this Agreement.  After any resignation  pursuant to
this Section 13.8,  the provisions of this Section 13 shall inure to the benefit
of the retiring Agent as to any actions taken or omitted to be taken by it while
it was Agent hereunder.

SECTION 14 GENERAL.

         14.1 Waiver;  Amendments. No delay on the part of the Agent or any Bank
in the exercise of any right, power or remedy shall operate as a waiver thereof,
nor shall any single or partial  exercise by any of them of any right,  power or
remedy preclude other or further exercise thereof,  or the exercise of any other
right, power or remedy. No amendment, modification or waiver of, or consent with
respect to, any  provision of this  Agreement or the Notes shall in any event be
effective  unless the same shall be in writing and signed and delivered by Banks
having  an  aggregate  Percentage  of not  less  than the  aggregate  Percentage
expressly  designated  herein  with  respect  thereto or, in the absence of such
designation as to any provision of this Agreement or the Notes,  by the Required
Banks,  and then any such  amendment,  modification,  waiver or consent shall be
effective only in the specific  instance and for the specific  purpose for which
given.  No  amendment,  modification,  waiver or  consent  shall  (i)  extend or
increase the amount of the Commitments,  (ii) extend the date for payment of any
principal  of or  interest  on the Loans or any fees  payable  hereunder,  (iii)
reduce the  principal  amount of any Loan,  the rate of interest  thereon or any
fees payable  hereunder,  or (iv) change the  aggregate  Percentage  required to
effect an amendment,  modification, waiver or consent without, in each case, the
consent of all Banks. No provisions of Section 13 shall be amended,  modified or
waived without the consent of the Agent.


                                      -54-


<PAGE>


         14.2  Confirmations.  The  Company and each holder of a Note agree from
time to time, upon written request  received by it from the other, to confirm to
the other in writing  (with a copy of each such  confirmation  to the Agent) the
aggregate unpaid principal amount of the Loans then outstanding under such Note.

         14.3  Notices.  Except as otherwise  provided in Sections  2.3, 2.4 and
4.3, all notices hereunder shall be in writing  (including,  without limitation,
facsimile transmission) and shall be sent to the applicable party at its address
shown below its signature  hereto or at such other address as such party may, by
written  notice  received by the other parties  hereto,  have  designated as its
address for such purpose. Notices sent by facsimile transmission shall be deemed
to have been given when sent;  notices sent by mail shall be deemed to have been
given three  Business  Days after the date when sent by  registered or certified
mail, postage prepaid; and notices sent by hand delivery shall be deemed to have
been given when  received.  For purposes of Sections  2.3, 2.4, 2.5 and 4.3, the
Agent shall be entitled to rely on telephonic  instructions from any person that
the Agent in good faith  believes  is an  authorized  officer or employee of the
Company,  and the Company  shall hold the Agent and each Bank  harmless from any
loss, cost or expense resulting from any such reliance.

         14.4  Computations.  Where  the  character  or  amount  of any asset or
liability  or item of income or expense is  required  to be  determined,  or any
consolidation  or other  accounting  computation is required to be made, for the
purpose of this  Agreement,  such  determination  or calculation  shall,  to the
extent applicable and except as otherwise  specified in this Agreement,  be made
in accordance with generally accepted  accounting  principles applied on a basis
consistent with those used in the preparation of the Company's audited financial
statements  for the 1995 Fiscal Year.

14.5  Regulation U. Each Bank  represents that it in good  faith is not relying,
either  directly or indirectly,  upon any Margin Stock  as   collateral security
for  the extension  or  maintenance  by  it  of any credit provided for in  this
Agreement.

         14.6 Costs, Expenses and Taxes. The Company agrees to pay on demand (a)
all reasonable out-of-pocket costs and expenses of the Agent (including the fees
and charges of counsel for the Agent and of local  counsel,  if any,  who may be
retained  by said  counsel)  in  connection  with  the  preparation,  execution,
delivery and administration of this Agreement,  the other Loan Documents and all
other documents provided for herein or delivered or to be delivered hereunder or
in connection herewith (including, without


                                      -55-


<PAGE>




limitation,  any amendment,  supplement or waiver to any Loan Document), and (b)
all reasonable out-of-pocket costs and expenses (including reasonable attorneys'
fees, court costs and other legal expenses)  incurred by the Agent and each Bank
after an Event of Default in connection  with the enforcement of this Agreement,
the other  Loan  Documents  or any such  other  documents.  Each Bank  agrees to
reimburse  the Agent for such  Bank's  pro rata share  (based on its  respective
Percentage) of any such costs and expenses of the Agent not paid by the Company.
In  addition,  the  Company  agrees to pay,  and to save the Agent and the Banks
harmless from all  liability  for, any stamp or other taxes which may be payable
in connection with the execution and delivery of this Agreement,  the borrowings
hereunder,  the issuance of the Notes or the execution and delivery of any other
Loan  Document or any other  document  provided for herein or delivered or to be
delivered hereunder or in connection  herewith.  All obligations provided for in
this Section 14.6 shall  survive  repayment  of the Loans,  cancellation  of the
Notes and any termination of this Agreement.

         14.7 Subsidiary  References.  The provisions of this Agreement relating
to  Subsidiaries  shall  apply only  during such times as the Company has one or
more Subsidiaries.

         14.8  Captions.  Section  captions  used  in  this  Agreement  are  for
convenience only and shall not affect the construction of this Agreement.

         14.9 Assignments; Participations.

         14.9.1 Assignments. Any Bank may, with the prior written consent of the
Company (which consent shall not be  unreasonably  delayed or withheld),  at any
time assign and delegate to one or more  commercial  banks or other Persons (any
Person to whom such an  assignment  and  delegation  is to be made being  herein
called an "Assignee"),  all or any fraction of such Bank's Loans and Commitments
(which assignment and delegation shall be of an equal percentage of each of such
Bank's  Loans and  Commitments  and shall be of a  constant,  and not a varying,
percentage of all the assigning  Bank's Loans and of such Bank's  obligations in
respect of its Commitments) in a minimum aggregate amount equal to the lesser of
(i)  the  assigning  Bank's  remaining  Loans  and  (to  the  extent  not  used)
Commitments and (ii) $5,000,000;  provided,  however, that (a) no assignment and
delegation  may be made to any  Person  if, at the time of such  assignment  and
delegation,  the Company  would be  obligated  to pay any greater  amount  under
Section 8 to the  Assignee  than the  Company  is then  obligated  to pay to the
assigning  Bank  under  such  Section,  (b)  after  giving  



                                      -56-


<PAGE>



effect to any such  assignment,  no Bank shall have a Total  Percentage  of less
than one  seventh,  and (c) the  Company  and the  Agent  shall be  entitled  to
continue  to deal  solely and  directly  with such Bank in  connection  with the
interests  so assigned and  delegated to an Assignee  until the date when all of
the following conditions shall have been met:

                  (x) five Business Days (or such lesser period of time as the
         Agent and the assigning Bank shall agree) shall have passed after
         written notice of such assignment and delegation, together with payment
         instructions, addresses and related information with respect to such
         Assignee, shall have been given to the Company and the Agent by such
         assigning Bank and the Assignee,

                  (y) the assigning Bank and the Assignee shall have executed
         and delivered to the Company and the Agent an assignment agreement
         substantially in the form of Exhibit J (an "Assignment Agreement"),
         together with any documents required to be delivered thereunder, which
         Assignment Agreement shall have been accepted by the Company and the
         Agent, and

                  (z) the  assigning  Bank or the  Assignee  shall have paid the
         Agent a processing fee of $3,000.

From and after the date on which the conditions described above have been met,
(x) such Assignee shall be deemed automatically to have become a party hereto
and, to the extent that rights and obligations hereunder have been assigned and
delegated to such Assignee pursuant to such Assignment Agreement, shall have the
rights and obligations of a Bank hereunder, and (y) the assigning Bank, to the
extent that rights and obligations hereunder have been assigned and delegated by
it pursuant to such Assignment Agreement, shall be released from its obligations
hereunder. Within five Business Days after the effectiveness of any assignment
and delegation, the Company shall execute and deliver to the Agent (for delivery
to the Assignee and the assigning Bank, as applicable) a new Revolving Note in
the principal amount of the Assignee's Revolving Commitment and a new Term Note
in the principal amount of the Assignee's Term Loan and, if the assigning Bank
has retained any Revolving Commitment or Term Loan hereunder, a replacement
Revolving Note in the principal amount of the Revolving Commitment retained by
the assigning Bank and a replacement Term Note in the principal amount of the
assigning Bank's retained Term Loan (such Notes to be in exchange for, but not
in payment of, the predecessor Notes held by such assigning Bank). Each such
Note shall be dated the effective date of such 


                                      -57-


<PAGE>



assignment.  The assigning Bank shall mark the predecessor Notes "exchanged" and
deliver them to the Company.  Accrued  interest on that part of any  predecessor
Note being  assigned  shall be paid as  provided  in the  Assignment  Agreement.
Accrued  interest  and  fees on that  part of any  predecessor  Note  not  being
assigned shall be paid to the assigning Bank.  Accrued interest and accrued fees
shall be paid at the same time or times provided in the predecessor Notes and in
this Agreement.  Any attempted  assignment and delegation not made in accordance
with this Section 14.9.1 shall be null and void.

         Notwithstanding the foregoing provisions of this Section 14.9.1 or any
other provision of this Agreement, any Bank may at any time assign all or any
portion of its Loans and its Notes to a Federal Reserve Bank (but no such
assignment shall release any Bank from any of its obligations hereunder).

         14.9.2 Participations.  Any Bank may, with the prior written consent of
the Company (which consent shall not be  unreasonably  delayed or withheld),  at
any time sell to one or more  commercial  banks or other  Persons  participating
interests  in any Loan  owing to such Bank,  the Notes  held by such  Bank,  the
Commitments of such Bank, the direct or  participation  interest of such Bank in
any Letter of Credit or any other  interest of such Bank  hereunder  (any Person
purchasing any such participating interest being herein called a "Participant").
In the event of a sale by a Bank of a  participating  interest to a Participant,
(x) such Bank  shall  remain the  holder of its Notes for all  purposes  of this
Agreement,  (y) the  Company  and the Agent  shall  continue  to deal solely and
directly  with such Bank in connection  with such Bank's rights and  obligations
hereunder  and (z) all amounts  payable by the Company shall be determined as if
such Bank had not sold such  participation  and shall be paid  directly  to such
Bank. No Participant  shall have any direct or indirect voting rights  hereunder
except with respect to any of the events  described in the penultimate  sentence
of  Section  14.1.  Each Bank  agrees to  incorporate  the  requirements  of the
preceding sentence into each participation agreement which such Bank enters into
with any Participant.  The Company agrees that if amounts outstanding under this
Agreement  and the Notes are due and  payable  (as a result of  acceleration  or
otherwise),  each  Participant  shall be  deemed  to have the right of setoff in
respect of its participating  interest in amounts owing under this Agreement and
any Note and with  respect to any Letter of Credit to the same  extent as if the
amount of its  participating  interest were owing directly to it as a Bank under
this  Agreement;  provided  that such  right of setoff  shall be  subject to the
obligation of each  Participant to share with the Banks,  and the 

                                      -58-



<PAGE>



Banks agree to share with each  Participant,  as provided  in Section  7.5.  The
Company also agrees that each  Participant  shall be entitled to the benefits of
Section 8 as if it were a Bank (provided  that no Participant  shall receive any
greater  compensation  pursuant  to  Section 8 than  would have been paid to the
participating Bank if no participation had been sold).

         14.10  Governing  Law. This Agreement and each Note shall be a contract
made under and governed by the internal laws of the State of Illinois.  Whenever
possible each provision of this Agreement shall be interpreted in such manner as
to be effective  and valid under  applicable  law, but if any  provision of this
Agreement shall be prohibited by or invalid under applicable law, such provision
shall be  ineffective to the extent of such  prohibition or invalidity,  without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.  All obligations of the Company and rights of the Agent and the Banks
expressed  herein or in any other Loan Document  shall be in addition to and not
in limitation of those provided by applicable law.

         14.11  Counterparts.  This  Agreement  may be executed in any number of
counterparts  and by the different  parties hereto on separate  counterparts and
each  such  counterpart  shall  be  deemed  to  be an  original,  but  all  such
counterparts  shall  together  constitute but one and the same  Agreement.  When
counterparts  executed by all of the parties  hereto shall have been lodged with
the Agent (or, in the case of any Bank as to which an executed counterpart shall
not have been so lodged,  the Agent shall have received  confirmation  from such
Bank of execution of a counterpart  hereof by such Bank),  this Agreement  shall
become effective as of the date hereof,  and at such time the Agent shall notify
the Company and each Bank.

         14.12 Successors and Assigns.  This Agreement shall be binding upon the
Company,  the Banks and the Agent and their  respective  successors and assigns,
and shall inure to the benefit of the  Company,  the Banks and the Agent and the
permitted successors and assigns of the Banks and the Agent.


                                      -59-


<PAGE>





         14.13 Indemnification by the Company.

         (a) In consideration of the execution and delivery of this Agreement by
the Agent and the Banks and the agreement to extend the Commitments provided
hereunder, the Company hereby agrees to indemnify, exonerate and hold the Agent,
each Bank and each of the officers, directors, employees and agents of the Agent
and each Bank (collectively the "Bank Parties" and individually each a "Bank
Party") free and harmless from and against any and all actions, causes of
action, suits, losses, liabilities, damages and expenses, including, without
limitation, reasonable attorneys' fees and charges (collectively therein called
the "Indemnified Liabilities"), incurred by the Bank Parties or any of them as a
result of, or arising out of, or relating to (i) any tender offer, merger,
purchase of stock, purchase of assets or other similar transaction financed or
proposed to be financed in whole or in part, directly or indirectly, with the
proceeds of any of the Loans or (ii) the execution, delivery, performance or
enforcement of this Agreement or any other Loan Document by any of the Bank
Parties, except for any such Indemnified Liabilities arising on account of such
Bank Party's bad faith, gross negligence or willful misconduct. If and to the
extent that the foregoing undertaking may be unenforceable for any reason, the
Company hereby agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law. Nothing set forth above shall be construed to relieve any Bank
Party from any obligation it may have under this Agreement.

         (b) Without limiting the provisions of clause (a) above, the Company
agrees to reimburse each Bank Party against any and all losses, claims, damages,
penalties, judgments, liabilities and expenses (including reasonable attorneys'
and consultant's fees) which any Bank Party may pay, incur or become subject to
arising out of or relating to the use, handling, release, emission, discharge,
transportation, storage, treatment or disposal of any Hazardous Material at any
real property owned or leased by the Company or any Subsidiary or used by the
Company or any Subsidiary in its business or operations, except to the extent
caused by the acts or omissions of such Bank Party.

         (c) All obligations provided for in this Section 14.13 shall survive
repayment of the Loans, cancellation of the Notes and any termination of this
Agreement.

         14.14 Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED
HEREON,  OR ARISING OUT OF, UNDER,  OR IN CONNECTION  WITH THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT,  SHALL

                                      -60-


<PAGE>



BE BROUGHT AND MAINTAINED  EXCLUSIVELY IN THE COURTS OF THE STATE OF ILLINOIS OR
IN THE UNITED  STATES  DISTRICT  COURT FOR THE  NORTHERN  DISTRICT OF  ILLINOIS;
PROVIDED,  HOWEVER,  THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR
OTHER  PROPERTY  MAY BE  BROUGHT,  AT THE AGENT'S  OPTION,  IN THE COURTS OF ANY
JURISDICTION  WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.  EACH OF THE
COMPANY, THE AGENT AND EACH BANK HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE
JURISDICTION  OF THE COURTS OF THE STATE OF  ILLINOIS  AND OF THE UNITED  STATES
DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS FOR THE PURPOSE OF ANY SUCH
LITIGATION  AS SET FORTH  ABOVE.  EACH OF THE  COMPANY,  THE AGENT AND EACH BANK
FURTHER  IRREVOCABLY  CONSENTS  TO THE  SERVICE OF PROCESS BY  REGISTERED  MAIL,
POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF ILLINOIS.
THE COMPANY  HEREBY  EXPRESSLY AND  IRREVOCABLY  WAIVES,  TO THE FULLEST  EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY SUCH LITIGATION  BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND
ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO
THE EXTENT THAT THE  COMPANY HAS OR  HEREAFTER  MAY  ACQUIRE ANY  IMMUNITY  FROM
JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS  (WHETHER THROUGH SERVICE OR
NOTICE,  ATTACHMENT  PRIOR  TO  JUDGMENT,  ATTACHMENT  IN  AID OF  EXECUTION  OR
OTHERWISE)  WITH  RESPECT  TO  ITSELF  OR  ITS  PROPERTY,   THE  COMPANY  HEREBY
IRREVOCABLY  WAIVES  SUCH  IMMUNITY  IN  RESPECT OF ITS  OBLIGATIONS  UNDER THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS.

         14.15  Waiver of Jury Trial.  EACH OF THE  COMPANY,  THE AGENT AND EACH
BANK HEREBY  WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR  PROCEEDING TO
ENFORCE OR DEFEND ANY RIGHTS  UNDER  THIS  AGREEMENT,  ANY NOTE,  ANY OTHER LOAN
DOCUMENT AND ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH
MAY IN THE FUTURE BE  DELIVERED IN  CONNECTION  HEREWITH OR THEREWITH OR ARISING
FROM ANY BANKING RELATIONSHIP  EXISTING IN CONNECTION WITH ANY OF THE FOREGOING,
AND AGREES THAT ANY SUCH ACTION OR PROCEEDING  SHALL BE TRIED BEFORE A COURT AND
NOT BEFORE A JURY.

         14.16 References to Banks and Agent. So long as this Agreement has not
been amended by the Company and Harris to add additional parties hereto,
references in this Agreement and any instrument or document executed in
connection herewith to the "Banks" or the "Required Banks" shall be deemed to
refer to Harris and references to the "Agent" shall be deemed to be references
to Harris in its individual capacity as the sole Bank hereunder.




                                      -61-

<PAGE>


Delivered at Chicago, Illinois, as of the day and year first above written.

                                      GIBRALTAR PACKAGING GROUP, INC.


                                      By __/s/ W E Rose
                                         Title: __President_

                                      274 Riverside Avenue
                                      Westport, Connecticut  16880
                                      Attention:  John W. Lloyd
                                      Facsimile:  (203) 227-0887


                                      HARRIS TRUST AND SAVINGS BANK, 
                                      individually and as Agent


                                         By  /s/ John M. Dillon_____
                                                  Vice President

                                         111 West Monroe Street
                                         Chicago, Illinois  60690
                                         Attention:  John M. Dillon
                                         Facsimile:  (312) 461-2591




                                      


<PAGE>