TERM NOTE B


$10,000,000.00             Boston, Massachusetts               March 31, 1997


        FOR VALUE RECEIVED, the undersigned, PRIME MEDICAL SERVICES, INC., a
Delaware corporation ("MAKER"), hereby promises to pay to the order of
NATIONSBANK OF TEXAS, N.A.("PAYEE"), at the offices of The First National Bank
of Boston, as Administrative Agent (together with any successor as provided in
the Agreement, hereinbelow defined, the "ADMINISTRATIVE AGENT") at 100 Federal
Street, Boston, Massachusetts, in lawful money of the United States of America,
the principal sum of TEN MILLION AND 00/100 DOLLARS ($10,000,000.00), together
with interest on the outstanding principal balance from day to day remaining,
as herein specified.

        This Note has been executed and delivered by Maker pursuant to the terms
of that certain Second Amended and Restated Loan Agreement of even date herewith
among Maker, Payee, the Administrative Agent and each of the other Lenders which
is or may become a party thereto or any successor or assignee thereof (as the
same has been amended through the date hereof and may be further amended,
supplemented or modified from time to time, the "AGREEMENT") and is one of the
Term B Notes described therein. Capitalized terms used and not otherwise defined
herein shall have the same meanings as set forth in the Agreement.

        Reference is hereby made to the Agreement for provisions affecting this
Note, including, without limitation, provisions regarding payments, prepayments
(optional and mandatory), Events of Default and the Administrative Agent's and
Payee's rights as a result of the occurrence thereof.

        The outstanding principal balance hereof shall bear interest prior to
maturity at a varying rate per annum which shall from day to day be equal to the
lesser of (a) the Maximum Rate, or (b) the Applicable Rate in effect from day to
day, each such change in the rate of interest charged hereunder to become
effective, without notice to Maker, on the effective date of each change in the
Applicable Rate or the Maximum Rate, as the case may be; provided, however, if
at any time the Applicable Rate shall exceed the Maximum Rate, thereby causing
the interest rate hereon to be limited to the Maximum Rate, then any subsequent
reduction in the Applicable Rate shall not reduce the rate of interest hereon
below the Maximum Rate until the total amount of interest accrued hereon equals
the amount of interest which would have accrued hereon if the Applicable Rate
had at all times been in effect. The unpaid principal balance of, and all
accrued and unpaid interest on, this Note shall be due and payable on the dates
and at the times set forth in the Agreement. All past-due principal and interest
shall bear interest at the Default Rate.

        Notwithstanding anything to the contrary contained herein, no provisions
of this Note shall require the payment or permit the collection of interest in
excess of the Maximum Rate. If any excess of interest in such respect is herein
provided for, or shall be adjudicated to be so provided, in this Note or
otherwise in connection with this loan transaction, the provisions of this
paragraph shall govern and prevail, and neither Maker nor the sureties,
guarantors, successors or assigns of Maker shall be obligated to pay the excess
amount of such interest, or any other excess sum paid for the use, forbearance
or detention of sums loaned pursuant hereto. If for any reason interest in
excess of the Maximum Rate shall be deemed charged, required or permitted by any
court of competent jurisdiction, any such excess shall be applied as a payment
and reduction of the principal of indebtedness evidenced by this Note; and, if
the principal amount hereof has been paid in full, any remaining excess shall
forthwith be paid to Maker. In determining whether or not the interest paid
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or payable exceeds the Maximum Rate, Maker, the Administrative Agent and Payee
shall, to the extent permitted by applicable law, (i) characterize any non-
principal payment as an expense, fee, or premium rather than as interest, (ii)
exclude voluntary prepayments and the effects thereof, and (iii) amortize,
prorate, allocate, and spread in equal or unequal parts the total amount of
interest throughout the entire contemplated term of the indebtedness evidenced
by this Note so that the interest for the entire term does not exceed the
Maximum Rate.

        Upon the occurrence of an Event of Default, the Administrative Agent may
(and if directed by the Required Lenders, shall) declare the entire unpaid
principal of and accrued interest on this Note immediately due and payable
without notice, demand or presentment, all of which are hereby waived, and upon
such declaration, the same shall become and shall be immediately due and
payable, and the Administrative Agent shall have the right to foreclose or
otherwise enforce all Liens or security interests, securing payment hereof, or
any part hereof, and offset against this Note any sum or sums owed by the
Administrative Agent, Payee or the holder hereof to Maker. Failure of the
Administrative Agent, Payee or the holder hereof to exercise this option shall
not constitute a waiver of the right to exercise the same upon the occurrence of
a subsequent Event of Default.

        If the Administrative Agent, Payee or the holder hereof expends any
effort in any attempt to enforce payment of all or any part or installment of
any sum due the holder hereunder, or if this Note is placed in the hands of an
attorney for collection, or if it is collected through any legal proceedings,
Maker agrees to pay all costs, expenses, and fees incurred by the Administrative
Agent, Payee or the holder, including reasonable. attorneys' fees.

        This Note shall be governed by and construed in accordance with the laws
of the Commonwealth of Massachusetts and the applicable laws of the United
States of America.

        Except as provided in the Agreement, Maker and each surety, guarantor,
endorser, and other party ever liable for payment of any sums of money payable
on this Note jointly and severally waive notice, presentment, demand for
payment, protest, notice of protest and non-payment or dishonor, notice of
acceleration, notice of intent to accelerate, notice of intent to demand,
diligence in collecting, grace, and all other formalities of any kind, and
consent to all extensions without notice for any period or periods of time and
partial payments, before or after maturity, and any impairment of any Collateral
securing this Note, all without prejudice to the Administrative Agent, Payee or
the holder. The Administrative Agent, Payee and the holder shall similarly have
the right to deal in any way, at any time, with one or more of the foregoing
parties without notice to any other party, and to grant any such party any
extensions of time for payment of any of said indebtedness, or to release or
substitute part or all of the Collateral securing this Note, or to grant any
other indulgences or forbearances whatsoever, without notice to any other party
and without in any way affecting the personal liability of any party hereunder.

                                    PRIME MEDICAL SERVICES, INC.



                                    By: /s/ Cheryl Williams
                                       -----------------------------------------
                                       Cheryl Williams, Vice President-Finance

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