ASSIGNMENT AND SECURITY AGREEMENT

         THIS ASSIGNMENT AND SECURITY  AGREEMENT (this  "Agreement") is made and
entered into as of the 1st day of September,  1999, by and between Prime Medical
Operating,  Inc., a Delaware  corporation  (the  "Secured  Party") and Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company (the "Debtor").

                                    RECITALS:

         A. Debtor and Secured Party have  executed and  delivered  that certain
Contribution  Agreement  dated  effective  September 1, 1999,  between and among
Debtor,  Secured Party,  Prime Medical Services,  Inc., a Delaware  corporation,
Prime/BDEC  Acquisition,  L.L.C., a Delaware limited liability  company,  Barnet
Dulaney Eye Center, P.L.L.C., an Arizona professional limited liability company,
LASIK Investors L.L.C., a Delaware limited liability company,  David D. Dulaney,
M.D., Ronald W. Barnet, M.D., and Mark Rosenberg (the "Contribution Agreement"),
and that certain Loan Agreement, dated September 1, 1999 (the "Loan Agreement"),
pursuant to which  Secured  Party agrees to make certain  loans to Debtor on the
terms and subject to the conditions provided therein.

         B. Secured Party has requested  that Debtor pledge the  Collateral  (as
defined below) to secure certain obligations and liabilities that Debtor may now
or  hereafter  have  to  Secured  Party,  including,   without  limitation,  any
obligations arising under loans made pursuant to the Loan Agreement.

     C. Debtor desires to enter into this Agreement as a material  inducement to
Secured Party's extension of credit under the Loan Agreement.

                                   AGREEMENT:

         NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements hereinafter set forth, and other good and valuable consideration, the
receipt and sufficiency of which Debtor  acknowledges,  Debtor and Secured Party
agree as follows:

                                    ARTICLE I

                       COLLATERAL AND SECURED OBLIGATIONS

         1.1 Grant of Security Interest.  Debtor hereby assigns,  transfers, and
pledges to Secured  Party,  and Debtor hereby grants to Secured Party a security
interest   in,   the   following   described   collateral   (collectively,   the
"Collateral"):

     (a) Interest in  Subsidiary.  All ownership  interests of Debtor in Horizon
Vision Center, Inc., a Nevada corporation  ("Horizon"),  whether now existing or
hereafter acquired and including,  without limitation, that certain 60% interest
in Horizon (the "Interests").


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                                        2




     (b) Interest in Acquisition Agreements. All of Debtor's interest and rights
(but not any obligations)  under those certain Stock Purchase  Agreements by and
between Debtor and the Shareholders of Horizon;

                  (c)  Accounts.  All  accounts  and  rights  now  or  hereafter
attributable  to any of the  Collateral  described in (a) and (b)above,  and all
rights of Debtor now or hereafter arising under any agreement  pertaining to the
Collateral  described in (a) and (b) above,  including  without  limitation  all
distributions,   proceeds,  fees,  dividends,  preferences,  payments  or  other
benefits of whatever nature which Debtor is now or may hereafter become entitled
to receive with respect to any Collateral described in (a) and (b) above;

                  (d) Additional  Property.  "Collateral" shall also include the
following  property  (collectively,  the  "Additional  Property")  which  Debtor
becomes  entitled  to receive  or shall  receive  in  connection  with any other
Collateral:  (i) any stock or other  ownership  certificate,  including  without
limitation,  any certificate representing a stock dividend or any certificate in
connection with any recapitalization,  reclassification,  merger, consolidation,
conversion,  sale of assets,  combination,  stock split, reverse stock split, or
spin-off;  (ii) any  option,  warrant,  subscription  or  right,  whether  as an
addition to or in substitution of any other  Collateral;  (iii) any dividends or
distributions  of any kind whatsoever,  whether  distributable in cash, stock or
other property;  (iv) any interest,  premium or principal payments;  and (v) any
conversion or redemption proceeds; and

                  (e) Proceeds.  All proceeds (cash and non-cash) arising out of
the sale, exchange, collection or other disposition of all or any portion of the
Collateral described in (a), (b), (c) or (d) above, including without limitation
proceeds in the form of stock, accounts, chattel paper, instruments,  documents,
goods, inventory and equipment.

The  security  interest in the  Collateral  hereby  granted by Debtor to Secured
Party may sometimes be referred to in this Agreement as the "Security Interest".

         1.2 Obligations.  This Agreement and the Security Interest shall secure
full and punctual payment and performance of the following indebtedness,  duties
and obligations (collectively, the "Obligations"):

                  (a) All liabilities and obligations of Debtor to Secured Party
or  any  subsidiary  of  Secured  Party  (including,   without  limitation,  any
principal,  interest,  fees and other amounts,  and any other obligations) under
and  pursuant to this  Agreement  and/or the  Contribution  Agreement,  the Loan
Agreement,   each   promissory  note  issued  pursuant  to  the  Loan  Agreement
(collectively,  the  "Note"),  and/or any other  contract or  agreement  between
Secured Party (or any of its subsidiaries) and Debtor or any affiliate of Debtor
(collectively,  including the Contribution Agreement, the Loan Agreement and the
Note, the "Other Agreements"); and

                  (b) (i)  all  indebtedness,  obligations  and  liabilities  of
Debtor  and/or any  affiliate of Debtor to Secured  Party or any  subsidiary  of
Secured  Party of any kind or  character,  now  existing or  hereafter  arising,
whether direct, indirect,  related,  unrelated,  fixed, contingent,  liquidated,
unliquidated, joint, several or joint and several, arising from, connected with,
or  related  to the Other  Agreements,  or any  other  document,  agreement,  or
instrument  executed  in  connection  therewith,  (ii) all  accrued  but  unpaid
interest  on  any  of  the  indebtedness  described  in  (i)  above,  (iii)  all
obligations  of Debtor  and/or any  affiliate of Debtor to Secured  Party or any
subsidiary  of Secured  Party  under any  documents  or  agreements  evidencing,
securing,  governing  and/or  pertaining to all or any part of the  indebtedness
described in (i) and (ii) above, (iv) all costs and expenses incurred by Secured
Party or its  subsidiaries in connection with the collection and  administration
of all or any part of the  indebtedness  and obligations  described in (i), (ii)
and (iii) above or the protection or preservation  of, or realization  upon, the
collateral  securing  all or any  part of  such  indebtedness  and  obligations,
including  without  limitation  all  attorneys'  fees,  and  (v)  all  renewals,
extensions, modifications and rearrangements of the indebtedness and obligations
described in (i), (ii), (iii) and (iv) above.

                  (c) All sums now or  hereafter  loaned or  advanced by Secured
Party or any  subsidiary  of Secured Party to Debtor or any affiliate of Debtor,
or expended by Secured  Party or its  subsidiaries  for the account of Debtor or
its  affiliates or otherwise  owing by Debtor or its affiliates to Secured Party
or its subsidiaries,  in respect of the Obligations, and all other sums expended
or  advanced  by  Secured  Party  or its  subsidiaries  pursuant  to any term or
provision of this Agreement or any Other Agreement (i) to collect and/or enforce
the Obligations or (ii) to maintain, protect and preserve the Collateral.

                                   ARTICLE II

       DEBTOR'S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO COLLATERAL

       Debtor hereby represents and warrants to Secured Party as follows:

         2.1 Ownership of Collateral.  Debtor has good and  marketable  title to
the Collateral  free and clear of any liens,  security  interests,  shareholders
agreement, calls, charge, or encumbrance,  except for this Security Interest. No
financing  statement or other  instrument  similar in effect covering all or any
part of the  Collateral is on file in any recording  office,  except as may have
been filed in favor of Secured Party relating to this Agreement.

         2.2  Power  &  Authority.  Debtor  has the  lawful  right,  power,  and
authority  to grant the Security  Interest in the  Collateral.  This  Agreement,
together  with all filings and other  actions  necessary or desirable to perfect
and protect such security interest,  which have been duly taken,  create a valid
and perfected first priority  security  interest in the Collateral  securing the
payment and performance of the Obligations.

         2.3 No  Agreements.  The  Interests  are not  subject  to any  right of
redemption,  or any  call or put  options,  voting  trust,  proxy,  shareholders
agreement,  right of first  refusal,  or any other  document or agreement  which
would in any way impair or adversely affect this Security Interest or the rights
of Secured Party under this Agreement.

         2.4  Securities.  Any  certificates  evidencing  securities  pledged as
Collateral  are valid and  genuine  and have not been  altered.  All  securities
pledged as Collateral have been duly  authorized and validly  issued,  are fully
paid and  non-assessable,  and were not issued in  violation  of the  preemptive
rights of any party or of any agreement by which Debtor or the issuer thereof is
bound.  No  restrictions  or  conditions  exist with  respect to the transfer or
voting of any securities pledged as Collateral.

                                   ARTICLE III

                  DEBTOR'S OTHER REPRESENTATIONS AND WARRANTIES

         3.1 Solvency of Debtor.  As of the date hereof,  (i) Debtor is and will
be solvent;  (ii) the fair saleable  value of Debtor's  assets  exceeds and will
continue  to exceed  Debtor's  liabilities  (both fixed and  contingent);  (iii)
Debtor  has  and  will  have  sufficient  capital  to  satisfy  all of  Debtor's
obligations as they become due; (iv) no receiver, trustee, or custodian has been
appointed for, or taken possession of, all or substantially all of the assets of
Debtor,  either in a  proceeding  brought by Debtor or in a  proceeding  brought
against Debtor; (v) Debtor is not the subject of a petition for relief under the
United States  Bankruptcy Code or any similar  federal or state  insolvency law,
including without limitation a petition filed by Debtor or a petition filed by a
third party seeking relief against  Debtor;  and (vi) Debtor has no intention of
filing a petition  for relief  under the United  States  Bankruptcy  Code or any
similar  federal  or state  insolvency  law,  or of  seeking  any other  form of
creditor relief,  within the two-year period  immediately  following the date of
this Agreement.

         3.2  Authority and  Compliance.  Debtor has full power and authority to
enter into this Agreement. Debtor has full power and authority to enter into and
perform  its  obligations  under each  Other  Agreement.  No further  consent or
approval is required as a condition  to the  validity of this  Agreement  or any
Other Agreement.  Debtor is in compliance with all applicable laws,  ordinances,
statutes, orders, regulations,  judgments, writs, or decrees of any governmental
entity to which it is subject.

         3.3  Binding  Agreement.   This  Agreement  and  each  Other  Agreement
constitute valid and legally binding  obligations of Debtor,  in accordance with
their terms, subject to the applicable bankruptcy,  insolvency,  reorganization,
moratorium, and similar laws affecting creditors' rights generally.

         3.4 Litigation.  There are no proceedings  pending or, to the knowledge
of Debtor,  threatened before any court or  administrative  agency which will or
may have a material adverse effect on the financial  condition of Debtor or upon
Debtor's  ability to perform its  obligations  under this Agreement or any Other
Agreement.

         3.5 No Conflicting Agreements.  There are no provisions of any existing
agreement,  mortgage,  indenture or contract  binding on Debtor or affecting its
property,  which  would  conflict  with or in any  way  prevent  the  execution,
delivery, or carrying out of the terms of this Agreement or any Other Agreement.

         3.6  Ownership  of  Assets.  Debtor  has  good  and  full  title to the
Collateral,  and the  Collateral  is owned  free and  clear of  liens,  charges,
claims, security interests, and other encumbrances.

     3.7 Taxes. Debtor has filed all tax returns required to be filed by Debtor.

                                   ARTICLE IV

                  DEBTOR'S COVENANTS WITH RESPECT TO COLLATERAL

         Debtor  covenants  and agrees  that from the date  hereof and until the
payment  and  performance  in  full  of the  Obligations  unless  Secured  Party
otherwise consents in writing:

         4.1  Delivery of  Instruments  and/or  Certificates.  Contemporaneously
herewith,   Debtor  covenants  and  agrees  to  deliver  to  Secured  Party  any
certificates,   documents,   or  instruments   representing  or  evidencing  the
Collateral,  with Debtor's  endorsement  thereon and/or  accompanied by property
instruments of transfer and assignment duly executed in blank with, if requested
by Secured Party,  signatures  guaranteed by a member or member  organization in
good standing of an authorized Securities Transfer Agents Medallion Program, all
in form and substance satisfactory to Secured Party.

         4.2  Further  Assurances.   Debtor  will   contemporaneously  with  the
execution  hereof  and from  time to time  thereafter  at its  expense  promptly
execute and deliver all further  instruments  and documents and take all further
action  necessary or  appropriate or that Secured Party may request in order (i)
to perfect and protect the security  interest created or purported to be created
hereby and the first priority of such security interest,  (ii) to enable Secured
Party to exercise  and enforce its rights and  remedies  hereunder in respect of
the  Collateral,  and (iii) to otherwise  effect the purposes of this Agreement,
including  without  limitation:  (A)  executing  and  filing  any  financing  or
continuation  statements,  or any  amendments  thereto;  (B)  obtaining  written
confirmation  from the issuer of any  securities  pledged as  Collateral  of the
pledge of such securities,  in form and substance satisfactory to Secured Party;
(C)  cooperating  with Secured Party in registering the pledge of any securities
pledged as Collateral with the issuer of such securities;  (D) delivering notice
of Secured Party's security interest in any securities  pledged as Collateral to
any securities or financial  intermediary,  clearing  corporation or other party
required by Secured Party, in form and substance  satisfactory to Secured Party;
and  (E)  obtaining  written  confirmation  of  the  pledge  of  any  securities
constituting Collateral from any securities or financial intermediary,  clearing
corporation  or other party  required by Secured  Party,  in form and  substance
satisfactory to Secured Party.

         4.3 Additional Property. All Additional Property, as defined in Section
1.1(d)  above,  received by Debtor shall be received in trust for the benefit of
Secured Party.  All Additional  Property and all  certificates  or other written
instruments or documents  evidencing and/or representing the Additional Property
that is  received  by Debtor,  together  with such  instruments  of  transfer as
Secured Party may request,  shall  immediately be delivered to or deposited with
Secured Party and held by Secured  Party as  Collateral  under the terms of this
Agreement.  If the  Additional  Property  received  by Debtor and  delivered  to
Secured  Party  pursuant  to this  Section  shall  be  shares  of stock or other
securities,  such shares of stock or other  securities shall be duly endorsed in
blank or  accompanied  by proper  instruments  of transfer and  assignment  duly
executed in blank with, if requested by Secured Party,  signatures guaranteed by
a member or member  organization  in good standing of an  authorized  Securities
Transfer Agents  Medallion  Program,  all in form and substance  satisfactory to
Secured  Party.  Secured  Party  shall  be  deemed  to  have  possession  of any
Collateral in transit to Secured Party or its agent.

         4.4  Sale,  Transfer,  Encumbrance.  Debtor  will not  sell,  transfer,
mortgage,  or otherwise  encumber any  Collateral or impair the value thereof in
any manner without  Secured  Party's prior written  consent,  including  without
limitation by purchase, lease, barter, trade, payment deferral, or the creation,
assumption  or guarantee of  indebtedness  or other  lending of credit.  Secured
Party's written consent to any sale,  mortgage,  transfer,  or encumbrance shall
not be construed to be a waiver of this  provision in respect to any  subsequent
proposed sale, mortgage, transfer, or encumbrance.

         4.5 Liens. Neither Debtor nor any person acting on Debtor's behalf has,
or shall have any right, power, or authority to and shall not create,  incur, or
permit to be placed or  imposed,  upon the  Collateral,  any lien of any type or
nature whatsoever, other than the liens in favor of Secured Party.

         4.6 Matters or  Occurrences  Affecting  Collateral  or this  Agreement.
Debtor will promptly  notify Secured Party of any and all matters or occurrences
that may have a material adverse effect on the status or value of the Collateral
or this Agreement,  including  without  limitation the occurrence of an Event of
Default,  or an event  which,  with giving of notice or lapse of time,  or both,
would constitute an Event of Default.

     4.7  Agreements  Pertaining to  Collateral.  Debtor will not enter into any
type of contract or agreement  pertaining to any of the Collateral or in any way
transfer any voting rights pertaining to the Collateral to any person or entity.

         4.8 Dilution of Ownership.  As to any securities pledged as Collateral,
Debtor  will not  consent to or approve of the  issuance  of (i) any  additional
interests  or  shares  of any  class  of  securities  of such  issuer,  (ii) any
instrument  convertible  voluntarily by the holder thereof or automatically upon
the occurrence or non-occurrence of any event or condition into, or exchangeable
for, any such  securities,  or (iii) any warrants,  options,  contracts or other
commitments  entitling any third party to purchase or otherwise acquire any such
securities.

         4.9  Restrictions  on  Securities.  Debtor  will  not  enter  into  any
agreement  creating,  or otherwise permit to exist, any restriction or condition
upon the transfer,  voting or control of any  securities  pledged as Collateral,
except as consented to in writing by Secured Party. As to any securities pledged
as collateral, Debtor will not consent to or approve of any stock split, reverse
stock  split,  stock  dividend,  reclassification,   or  other  similar  act  or
transaction  regarding the Interests  unless  consented to in writing by Secured
Party.

                                    ARTICLE V

                         DEBTOR'S AFFIRMATIVE COVENANTS

         Until payment and performance of all Obligations,  Debtor covenants and
agrees  that it shall  (i)  promptly  advise  Secured  Party in  writing  of any
litigation  filed against Debtor and of any condition,  event or act which comes
to its attention that would or might have a material  adverse effect on Debtor's
financial  condition  or on Debtor's  ability to perform the  Obligations,  (ii)
except  as  expressly   contemplated  in  Section  4.3(e)(i)  and  (ii)  of  the
Contribution  Agreement,  pay all available funds toward  repayment of the Note,
regardless  of whether  payment of such amounts  exceeds the  required  payments
under  the Note and  (iii) if  Borrower  uses any  proceeds  from the  Note,  to
acquire,  directly or indirectly,  a one hundred  percent  (100%)  interest in a
Target Center (as defined in the Contribution  Agreement),  Borrower shall cause
such  Target  Center to execute a  security  agreement,  acceptable  in form and
substance  to Lender,  granting  to Lender or one of Lender's  subsidiaries  the
highest available priority security interest in all of the assets of such Target
Center.

                                   ARTICLE VI

                               NEGATIVE COVENANTS

         Until payment and performance of all Obligations,  Debtor covenants and
agrees that Debtor will not, without the prior written consent of Secured Party:

     6.1 Liens. Grant, suffer, or permit liens on, or security interests in, the
Collateral.

         6.2  Violate  Other  Covenants.  Violate  or fail to  comply  with  any
covenants  or  agreements  regarding  other  debt  which  will or would with the
passage  of time or upon  demand  cause the  maturity  of any  other  debt to be
accelerated.

                                   ARTICLE VII

                              DEFAULT AND REMEDIES

     7.1 Events of Default.  An Event of Default  (herein so called) shall exist
if any one or more of the following events shall occur:

                  (a) The  failure  of Debtor to pay any amount  required  to be
paid  under  the  Loan  Agreement  (including,  without  limitation,  principal,
interest and fees due  thereunder),  or any other amount which Debtor may now or
hereafter  owe to Secured Party under any Other  Agreement or otherwise,  within
ten (10) calendar days after such amount is due;

                  (b) The  failure  of Debtor to pay any  Obligation  after such
amount is due (and, if applicable  under the terms of any contractual  agreement
creating or governing such  Obligation,  after the expiration of any cure period
expressly required);

     (c) Debtor's breach of a covenant in this Agreement or any other failure to
perform its obligations under this Agreement or any Other Agreement;

                  (d) Any  representation  or  warranty  made by  Debtor in this
Agreement or any Other Agreement between Debtor and Secured Party shall be false
or materially misleading,  as determined in the reasonable discretion of Secured
Party;

                  (e) Any event of default  shall  occur  under the terms of the
Loan  Agreement  and shall not be cured within the time  expressly  provided for
with respect thereto in the Loan Agreement;

                  (f) If Debtor or any other party  obligated to pay any portion
of the  Obligations:  (i)  becomes  insolvent,  or makes a transfer  in fraud of
creditors,  or makes an assignment  for the benefit of  creditors,  or admits in
writing its inability to pay its debts as they become due; (ii) generally is not
paying its debts as such debts  become due and  Secured  Party,  in good  faith,
determines that such event or condition  could lead to a material  impairment of
the Collateral, or any part thereof, or of any other payment security for any of
the Obligations;  (iii) has a receiver,  trustee or custodian  appointed for, or
take possession of, all or substantially  all of the assets of such party or any
of the  Collateral,  either  in a  proceeding  brought  by  such  party  or in a
proceeding  brought against such party and such appointment is not discharged or
such  possession  is not  terminated  within sixty (60) days after the effective
date thereof or such party  consents to or  acquiesces  in such  appointment  or
possession;  (iv) files a petition for relief under the United States Bankruptcy
Code or any other present or future federal or state  insolvency,  bankruptcy or
similar laws (all of the foregoing  hereinafter  collectively called "Applicable
Bankruptcy  Law") or an  involuntary  petition for relief is filed  against such
party under any Applicable  Bankruptcy Law and such involuntary  petition is not
dismissed  within  sixty  (60) days after the  filing  thereof,  or an order for
relief naming such party is entered under any Applicable  Bankruptcy Law, or any
composition, rearrangement, extension, reorganization or other relief of debtors
now or hereafter  existing is requested or consented to by such party; (v) fails
to  have  discharged  within  a  period  of  sixty  (60)  days  any  attachment,
sequestration  or similar writ levied upon,  or any claim  against or affecting,
any  property  of such party;  or (vi) fails to pay within  ninety (90) days any
final money judgment against such party; or

                  (g) The issuer of any securities constituting Collateral files
a petition  for relief  under any  Applicable  Bankruptcy  Law,  an  involuntary
petition  for  relief is filed  against  any such  issuer  under any  Applicable
Bankruptcy Law and such involuntary petition is not dismissed within thirty (30)
days after the filing thereof,  or an order for relief naming any such issuer is
entered under any Applicable Bankruptcy Law.

     7.2 Secured Party's Remedies. Upon the occurrence of an Event of Default:

                  (a) Secured Party may declare the Obligations in whole or part
immediately due and may enforce payment and performance of the same and exercise
any rights under the Texas UCC,  rights and remedies of Secured Party under this
Agreement, or otherwise.

                  (b) Secured  Party may, at Secured  Party's  option and at the
expense of Debtor,  either in Secured Party's own right or in the name of Debtor
and in the same manner and to the same extent that Debtor  might  reasonably  so
act  if  this  Agreement  had  not  been  made:  (i) do  all  things  requisite,
convenient,  or  necessary  to enforce the  performance  and  observance  of all
rights,  remedies and privileges of Debtor arising from the  Collateral,  or any
part thereof,  including without limitation compromising,  waiving, excusing, or
in any manner releasing or discharging any obligation of any party to or arising
from the Collateral;  (ii) take possession of the books, papers,  chattel paper,
documents of title, and accounts of Debtor,  wherever  located,  relating to the
Collateral; (iii) sue or otherwise collect and receive money attributable to the
Collateral;  and (iv) exercise any other lawfully  available powers or remedies,
and do all other things  which  Secured  Party deems  requisite,  convenient  or
necessary  or which the  Secured  Party  deems  proper to protect  the  Security
Interest.

                  (c) Secured Party may foreclose  this  Agreement in the manner
now or  hereafter  provided  or  permitted  by law and may upon such  reasonable
notification  prior thereto as may be required by applicable  law (Debtor hereby
agreeing  that ten  days'  notice is  commercially  reasonable),  sell,  assign,
transfer,  or otherwise  dispose of the Collateral at public or private sale, in
whole  or in  part,  and  Secured  Party  may,  in its own  name or as  Debtor's
attorney-in-fact  effectively  assign and transfer the  Collateral,  or any part
thereof,   absolutely,  and  execute  and  deliver  all  necessary  assignments,
conveyances,  bills of sale, and other  instruments with power to substitute one
or more persons or  corporations  with like power.  Any such  foreclosure  sale,
assignment,  transfer,  or other  disposition  shall, to the extent permitted by
law,  be a  perpetual  bar,  both at law and in equity,  against  Debtor and all
persons and corporations  lawfully  claiming by or through or under Debtor.  Any
such foreclosure sale may be adjourned from time to time. Upon any sale, Secured
Party may bid for and purchase the  Collateral,  or any part  thereof,  and upon
compliance with the terms of sale may hold,  retain,  possess and dispose of the
Collateral, in its absolute right without further accountability.  Secured Party
shall have the right to be  credited  on the  amount of its bid a  corresponding
amount of the Obligations as of the date of such sale.

                  (d) If, in the opinion of Secured Party, there is any question
that a public sale or  distribution  of any Collateral will violate any state or
federal  securities  law,  Secured  Party  (i) may  offer  and  sell  securities
privately to purchasers who will agree to take them for investment  purposes and
not with a view to distribution  and who will agree to imposition of restrictive
legends on the  certificates  representing  the security,  or (ii) may sell such
securities in any type of offering  which  complies  with, or is exempt from the
registration  requirements  of, the  Securities  Act of 1933 and any  applicable
state  securities laws, and no sale so made in good faith by Secured Party shall
be deemed to be not "commercially reasonable" because so made.

                  (e)  Not  in  limitation  of  any  other   provision  of  this
Agreement,  Secured  Party shall have all rights and remedies of a secured party
under the Texas UCC.

         7.3  Application  of Proceeds.  Secured Party may apply the proceeds of
any foreclosure  sale hereunder or from any other  permitted  disposition of the
Collateral  or any part  thereof as  follows:  (a) first,  to the payment of all
reasonable  costs and expenses of any foreclosure  and collection  hereunder and
all proceedings in connection  therewith,  including reasonable attorneys' fees;
(b) then, to the  reimbursement of Secured Party for all  disbursements  made by
Secured Party for taxes,  assessments or liens superior to the Security Interest
and  which  Secured  Party  shall  deem  expedient  to  pay;  (c)  then,  to the
reimbursement of Secured Party of any other  disbursements made by Secured Party
in accordance with the terms hereof or under the  Contribution  Agreement or any
Other  Agreement;  (d)  then,  to or among the  amounts  of fees,  interest  and
principal then owing and unpaid in respect of the Obligations,  in such priority
as Secured Party may determine in its discretion;  and (e) the remainder of such
proceeds,  if  any,  shall  be  paid  to  Debtor.  If  such  proceeds  shall  be
insufficient to discharge the entire  Obligations,  Secured Party shall have any
other available legal recourse  against Debtor under, or for the performance of,
the  Contribution  Agreement and any Other Agreement  between Debtor and Secured
Party,  for the deficiency,  together with interest  thereon at the maximum rate
permitted under applicable law.

         7.4  Enforcement  of  Obligations.  Nothing in this Agreement or in any
other  document  or  agreement  shall  affect or impair  the  unconditional  and
absolute right of Secured Party to enforce the  Obligations as and when the same
shall become due in accordance with the terms of any Other Agreement.

                                  ARTICLE VIII

                             RIGHTS OF SECURED PARTY

         8.1  Subrogation.  Upon the occurrence of an Event of Default,  Secured
Party,  at its  election,  may  subrogate  to all of the  interest,  rights  and
remedies  of the  Debtor,  in respect  to any of the  Collateral  or  agreements
pertaining thereto.

         8.2 Secured Party  Appointed  Attorney-in-Fact.  Debtor hereby appoints
Secured Party as  attorney-in-fact  of Debtor,  with full authority in the place
and stead of Debtor and in the name of Debtor, Secured Party or otherwise,  from
time to time on Secured  Party's  discretion and upon the occurrence of an Event
of Default, to take any action and to execute any instrument which Secured Party
may deem  necessary or advisable to accomplish  the purposes of this  Agreement,
including without  limitation:  (a) to ask, demand,  collect,  sue for, recover,
compound, receive and give acquittance and receipts for moneys due and to become
due under or in respect of any of the Collateral;  (b) to receive,  endorse, and
collect  any  drafts or other  instruments,  documents  and  chattel  paper,  in
connection  with clause (a) of this  Section 8.2; (c) to file any claims or take
any action or institute any proceeding which Secured Party may deem necessary or
desirable for the  collection  of any of the  Collateral or otherwise to enforce
the rights of Secured Party against any of the Collateral; and (d) to assign and
transfer the  Collateral,  or any part  thereof,  absolutely  and to execute and
deliver  endorsements,   assignments,  conveyances,  bills  of  sale  and  other
instruments  with power to substitute  one or more persons or  corporation  with
like power.

         8.3  Performance  by Secured  Party.  If Debtor  fails to  perform  any
agreement  contained  herein,  Secured  Party may itself  perform,  or cause the
performance  of, such  agreement,  and the reasonable  expenses of Secured Party
incurred in connection  therewith  shall be payable by Debtor under Section 8.8.
In no  event,  however,  shall  Secured  Party  have any  obligation  or  duties
whatsoever to perform any covenant or agreement of Debtor contained herein,  and
any such performance by Secured Party shall be wholly discretionary with Secured
Party.

         8.4 Duties of Secured  Party.  The powers  conferred upon Secured Party
hereunder  are solely to protect its  interest in the  Collateral  and shall not
impose any duty upon it to exercise any such powers. Except for the safe custody
of any  Collateral  in its  possession  and the  accounting  for money  actually
received by it hereunder,  Secured Party shall have no duty as to any Collateral
or as to the taking of any  necessary  steps to preserve  rights  against  prior
parties or any other rights  pertaining to any Collateral.  Without limiting the
generality of the foregoing,  Secured Party shall not have any obligation,  duty
or  responsibility  to do any of the  following:  (a) ascertain any  maturities,
calls,  conversions,  exchanges,  offers, tenders or similar matters relating to
the  Collateral or informing  Debtor with respect to any such matters;  (b) fix,
preserve  or  exercise  any  right,  privilege  or option  (whether  conversion,
redemption or otherwise) with respect to the Collateral; (c) collect any amounts
payable  in  respect  of the  Collateral;  (d)  sell all or any  portion  of the
Collateral,  for any reason;  or (e) hold the Collateral for or on behalf of any
party other than Debtor.

         8.5 No  Liability  of Secured  Party.  Neither the  acceptance  of this
Agreement by Secured Party,  nor the exercise of any rights hereunder by Secured
Party,  shall be construed in any way as an  assumption  by Secured Party of any
obligations,  responsibilities,  or duties of Debtor arising in connection  with
the  Collateral  assigned  hereunder  or  otherwise  bind  Secured  Party to the
performance of any  obligations  respecting the  Collateral,  it being expressly
understood  that Secured  Party shall not be obligated to perform,  observe,  or
discharge  any  obligation,  responsibility,  duty,  or  liability  of Debtor in
respect of any of the Collateral,  including without limitation  appearing in or
defending any action, expending any money or incurring any expense in connection
therewith.  TO THE FULLEST EXTENT  PERMITTED BY APPLICABLE LAW, DEBTOR SHALL AND
DOES AGREE TO INDEMNIFY, PROTECT, DEFEND AND HOLD HARMLESS SECURED PARTY AND ITS
SUBSIDIARIES,  AND EACH OF THEIR OFFICERS, DIRECTORS,  REPRESENTATIVES,  AGENTS,
EMPLOYEES,  LENDERS,  SUCCESSORS AND ASSIGNS,  FROM AND AGAINST ALL LIABILITIES,
CLAIMS, DAMAGES,  LOSSES, FINES, PENALTIES,  CAUSES OF ACTIONS, SUITS, JUDGMENTS
AND EXPENSES (INCLUDING COURT COSTS,  ATTORNEY'S FEES AND COST OF INVESTIGATION)
OF ANY  NATURE,  KIND OR  DESCRIPTION  OF ANY  PERSON  OR  ENTITY,  DIRECTLY  OR
INDIRECTLY,  ARISING OUT OF, CAUSED BY OR RESULTING  FROM (IN WHOLE OR IN PART),
ANY ACT OR  OMISSION  OF SECURED  PARTY,  OR ANYONE  ACTING ON BEHALF OF SECURED
PARTY,  IN CONNECTION  WITH THE  COLLATERAL,  INCLUDING  WITHOUT  LIMITATION ANY
MARKET FLUCTUATIONS IN THE COLLATERAL AS A RESULT OF SECURED PARTY'S SALE OF, OR
FAILURE TO SELL, THE INTERESTS AT ANY  PARTICULAR  TIME WHEN IT HAS THE RIGHT TO
DO  SO.  THE  FOREGOING  INDEMNITY  SHALL  SURVIVE  THE  EXPIRATION  OR  EARLIER
TERMINATION OF THIS AGREEMENT.

         8.6 Right of Secured Party to Defend Action Affecting Security. Secured
Party  may,  at the  expense  of  Debtor,  appear in and  defend  any  action or
proceeding at law or in equity  purporting to affect  Secured  Party's  Security
Interest under this Agreement.

         8.7 Right of  Secured  Party to Prevent  or Remedy  Default.  If Debtor
shall fail to perform any of the covenants,  conditions and agreements  required
to be performed and observed by Debtor under any Other Agreement,  or in respect
of the Collateral (subject to any applicable default cure period), Secured Party
(a) may but  shall not be  obligated  to take any  action  Secured  Party  deems
necessary  or  desirable  to  prevent  or remedy  any such  default by Debtor or
otherwise to protect the Security Interest,  and (b) shall have the absolute and
immediate right to take possession of the Collateral or any part thereof (to the
extent Secured Party has not previously taken  possession) to such extent and as
often as the Secured Party, in its sole discretion, deems necessary or desirable
in order to prevent  or to cure any such  default by  Debtor,  or  otherwise  to
protect the security of this Agreement. Secured Party may advance or expend such
sums of money for the account of Debtor as Secured Party in its sole  discretion
deems necessary for any such purpose.

         8.8 Secured Party's Expenses. All reasonable advances, costs, expenses,
charges and attorneys' fees which Secured Party may make, pay or incur under any
provision  of this  Agreement  for the  protection  of its  security  or for the
enforcement of any of its rights hereunder,  including,  without limitation,  in
foreclosure  proceedings commenced and subsequently  abandoned or in any dispute
or litigation in which Secured Party or the holder of any of the Obligations may
become  involved  by reason of or  arising  out of any  Other  Agreement  or the
Collateral,  shall be a part of the  Obligations  and shall be paid by Debtor to
Secured  Party,  upon demand,  and shall bear interest until paid at the maximum
rate of interest  permitted by applicable law, from the date incurred by Secured
Party until repaid by Debtor.

         8.9. Convertible  Collateral.  Secured Party may present for conversion
any  Collateral  which is  convertible  into any other  instrument or investment
security or a  combination  thereof with cash,  but Secured Party shall not have
any duty to present for conversion any Collateral  unless it shall have received
from Debtor  detailed  written  instructions to that effect at a time reasonably
far in advance of the final conversion date to make such conversion possible.

         8.10 Secured Party's Right of Set-Off.  Upon the happening of any event
entitling  Secured  Party to pursue any remedy  provided  herein,  or if Secured
Party shall be served with garnishment process in which Debtor shall be named as
defendant,  whether or not Debtor  shall be in  default  hereunder  at the time,
Secured Party may, but shall not be required to, set-off any indebtedness  owing
by  Secured  Party  to  Debtor  against  any of the  Obligations  without  first
resorting to the security hereunder and without prejudice to any other rights or
remedies of Secured Party or its Security Interest.

         8.11 Remedies.  No right or remedy herein  reserved to Secured Party is
intended to be exclusive  of any other right or remedy,  but each and every such
remedy shall be cumulative,  not in lieu of, but in addition to any other rights
or remedies given under this Agreement and all other security documents. Any and
all of Secured  Party's  rights and remedies may be exercised  from time to time
and as often as such exercise as deemed necessary or desirable by Secured Party.

         8.12 Debtor's Waivers.  Debtor waives notice of the creation,  advance,
increase,  existence,  extension,  or  renewal  of, and of any  indulgence  with
respect to, the  Obligations;  waives notice of intent to accelerate,  notice of
acceleration,  notice  of  intent  to  demand,  presentment,  demand,  notice of
dishonor,  and  protest;   waives  notice  of  the  amount  of  the  Obligations
outstanding  at any time,  notice of any change in  financial  condition  of any
person liable for the  Obligations  or any part thereof,  notice of any Event of
Default,  and all other  notices  respecting  the  Obligations;  and agrees that
maturity of the Obligations  and any part thereof may be accelerated,  extended,
or renewed one or more times by Secured Party in its discretion,  without notice
to Debtor.

         8.13 Other Parties and Other Collateral.  No renewal or extension of or
any other  indulgence  with respect to the  Obligations or any part thereof,  no
release  of any  security,  no  release  of any  person  (including  any  maker,
endorser,  guarantor,  or  surety)  liable  on  the  Obligations,  no  delay  in
enforcement  of payment,  and no delay or admission or lack of diligence or care
in exercising any right or power with respect to the Obligations or any security
therefor  or  guaranty  thereof or under this  Agreement  shall in other  manner
impair  or affect  the  rights  of  Secured  Party  under  the law,  under  this
Agreement,  or under any other  document or  agreement  pertaining  to the other
security for the  Obligations,  before  foreclosing  upon the Collateral for the
purpose of paying the Obligations.  Debtor waives any right to the benefit of or
to require or control application of any other security or proceeds thereof, and
Debtor  agrees that Secured  Party shall have no duty or obligation to Debtor to
apply to the Obligations any such other security or proceeds thereof.

                                   ARTICLE IX

                                  MISCELLANEOUS

     9.1 Terms  Commercially  Reasonable.  The terms of this Agreement  shall be
deemed commercially reasonable within the meaning of the Texas UCC.

         9.2 Notices.  Any notices or demands  required or permitted to be given
hereunder  shall be  deemed  sufficiently  given if in  writing  and  personally
delivered or mailed (with all postage and charges prepaid), addressed to Secured
Party or to Debtor their respective  addresses set forth below, or at such other
address as the above parties may from time to time  designate by written  notice
to the other given in  accordance  with this Section  9.2.  Any such notice,  if
personally  delivered or  transmitted  by telex or telegram,  shall be deemed to
have been given on the date so delivered or transmitted or, if mailed, be deemed
to have been given on the day after such  notice is placed in the United  States
mail in accordance with this Section 9.2.

                  Secured Party:        1301 Capital of Texas Hwy., Suite C-300
                                        Austin, Travis County, Texas 78746
                                        Attn: President

                  with copy to:         Timothy L. LaFrey, Esq.
                                        Akin, Gump, Strauss, Hauer & Feld,L.L.P.
                                        1900 Frost Bank Plaza
                                        816 Congress Avenue
                                        Austin, Texas 78701

                  Debtor:               Prime/BDR Acquisition, L.L.C.
                                        1301 Capital of Texas Hwy., Suite C-300
                                        Austin, Travis County, Texas 78746
                                        Attn: President

         9.3 Parties Bound.  Secured Party's rights under this Agreement and the
Security Interest shall inure to the benefits of its successors and assigns, and
in the event of any  assignment  or  transfer of any of the  Obligations  or the
Collateral,  Secured  Party  thereafter  shall  be  fully  discharged  from  any
responsibility  with respect to the Collateral so assigned or  transferred,  but
Secured  Party shall  retain all rights and powers  hereby given with respect to
any of the  Obligations  or  Collateral  not so  assigned  or  transferred.  All
representations, warranties, and agreements of Debtor if more than one are joint
and several, and all shall be binding upon the personal representatives,  heirs,
successors, and assigns of Debtor.

         9.4 Waiver.  No delay of Secured Party in exercising any power or right
shall operate as a waiver thereof;  nor shall any single or partial  exercise of
any power or right preclude other or further exercise thereof or the exercise of
any other power or right.  No waiver by Secured Party of any right  hereunder of
any default by Debtor shall be binding upon Secured Party unless in writing, and
no failure by Secured  Party to exercise any power or right  hereunder or waiver
of any  default  by Debtor  shall  operate  as a waiver of any other or  further
exercise of such right or power of any further default.

         9.5 Agreement Continuing.  This Agreement shall constitute a continuing
agreement,  applying to all future as well as existing transactions,  whether or
not of the  character  contemplated  at the date of this  Agreement,  and if all
transactions between Secured Party and Debtor shall be closed at any time, shall
be equally  applicable to any new  transactions  thereafter.  Provisions of this
Agreement,  unless  by their  terms  exclusive,  shall be in  addition  to those
contained in any Other Agreement.

         9.6 Definitions. Unless the context indicated otherwise, definitions in
the Texas Business and Commerce Code ("Texas UCC") apply to words and phrases in
this Agreement; if Texas UCC definitions conflict, Chapter 9 definitions apply.

         9.7 Miscellaneous. In this Agreement, whenever the context so requires,
the neuter gender  includes the masculine and feminine,  and the singular number
includes  the plural and vice  versa.  The  headings  of  paragraphs  herein are
inserted only for convenience and shall in no way define,  describe or limit the
scope of intent of any  provisions  of this  Agreement.  No  change,  amendment,
modification,  cancellation,  or  discharge of any  provision of this  Agreement
shall be valid unless consented to in writing by Secured Party.

         9.8 Assignment of Secured  Party's  Interest.  Secured Party shall have
the right to assign all or any portion of its rights in this  Agreement  without
approval  or  consent.  Debtor  acknowledges  that  Lender  intends  to  make  a
collateral  assignment of its rights under this Agreement for the benefit of one
or more of its  lenders.  Debtor may not  assign  this  Agreement  or any of its
rights or  obligations  hereunder  without the express prior written  consent of
Secured Party in each instance.

     9.9 Applicable  Laws.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE  WITH THE LAWS OF THE STATE OF TEXAS AND THE  APPLICABLE  LAWS OF THE
UNITED STATES OF AMERICA.

     9.10 ENTIRE AGREEMENT. THIS AGREEMENT, THE LOAN AGREEMENT, THE NOTE AND THE
CONTRIBUTION AGREEMENT REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY
NOT BE  CONTRADICTED BY EVIDENCE OF PRIOR,  CONTEMPORANEOUS,  OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL  AGREEMENTS  BETWEEN THE
PARTIES.

                            [Signature page follows]


<PAGE>


                                SIGNATURE PAGE TO

                                 ASSIGNMENT AND

                               SECURITY AGREEMENT

         EXECUTED this 1 day of September, 1999.

DEBTOR:                                     Prime/BDR Acquisition, L.L.C.

                                    By: /s/ David Dulaney, M.D.

                                    Printed Name: David Dulaney, M.D.

                                    Title:Manager, Prime/BRD Acquisition, L.L.C.

SECURED PARTY:                              Prime Medical Operating, Inc.

                                    By: /s/ Cheryl Williams

                                    Printed Name: Cheryl Williams

                                    Title: Vice President