<PAGE>

================================================================================



                                 $30,000,000.00

                EQUIPMENT FACILITY AND REVOLVING CREDIT AGREEMENT


                                 By and Between


                                  SUMMIT BANK,

                                     as Bank


                                       and


                          VESTCOM INTERNATIONAL, INC.,


                                   as Borrower






                           Dated as of August 13, 1997




================================================================================

<PAGE>


                                TABLE OF CONTENTS
                                                                        PAGE
                                                                        ----
BACKGROUND                                                                1

AGREEMENT                                                                 1

I.   THE CREDIT ACCOMMODATIONS                                            1

      1.01   Equipment Facility                                           1
      1.02   Equipment Facility Maximum Principal Amount                  2
      1.03   Borrowing Procedures Under Equipment
             Facility                                                     2
      1.04   Interest on Equipment Loans/Term Loan                        3
      1.05   Equipment Loans Principal Payment Terms                      3
      1.06   The Revolving Credit Facility                                4
      1.07   Revolving Credit Facility Maximum Principal
             Amount                                                       4
      1.08   Letter of Credit Sub-Facility                                5
      1.09   Interest on Revolving Credit Loans                           5
      1.10   Revolving Credit Principal Payment Terms                     6
      1.11   Borrowing Procedures Under the Revolving
             Credit Facility                                              6
      1.12   Revolving Credit Interest Conversion and
             Continuance Options                                          6
      1.13   Arrangement Fees                                             7
      1.14   Commitment Fee                                               7
      1.15   Computation                                                  8
      1.16   Payments Generally; Debiting of Account                      8

II.  DEFINITIONS                                                          8

      2.01   Defined Terms                                                8
      2.02   Principles of Construction                                  24

III. PREPAYMENT                                                          24

      3.01   Prepayment of Revolving Credit Loans                        24
      3.02   Prepayments of Equipment Loans                              24
      3.03   Termination                                                 25


IV.  YIELD MAINTENANCE PROVISIONS                                        25

      4.01   Inability to Determine Rate                                 25
      4.02   Illegality                                                  25
      4.03   Requirement of Law                                          25



                                       i
<PAGE>


                                TABLE OF CONTENTS
                                ----------------- 
                                                                        PAGE
                                                                        ----
      4.04   Capital Adequacy                                            26
      4.05   Funding Indemnity                                           27
      4.06   Match Funding                                               28

V.   CONDITIONS                                                          28

      5.01   Requirements for Initial Funding                            28
      5.02   Requirements for Any Advance or Conversion                  32
      5.03   Additional Requirements for Advances
             Under Equipment Facility                                    29

VI.  REPRESENTATIONS AND WARRANTIES                                      30

      6.01   Organization; Authority                                     30
      6.02   Subsidiaries                                                30
      6.03   Use of Proceeds; Margin Regulation                          31
      6.04   Financial Statements                                        31
      6.05   Suits                                                       32
      6.06   Burdensome Agreements                                       32
      6.07   Defaults                                                    32
      6.08   ERISA                                                       32
      6.09   Tax Returns and Taxes                                       33
      6.10   Compliance with Statutes, etc.                              33
      6.11   Not an Investment Company                                   33
      6.12   No Authorizations or Approvals                              33
      6.13   Intellectual Property, etc.                                 33
      6.14   Assets and Properties                                       34
      6.15   Labor Matters                                               34
      6.16   Insurance                                                   34
      6.17   True and Complete Disclosure                                34

VII. AFFIRMATIVE COVENANTS                                               35

      7.01   Financial Statements                                        35
      7.02   Compliance Certificate                                      36
      7.03   Notice of Certain Events                                    36
      7.04   Preservation of Property; Insurance                         36
      7.05   Taxes                                                       37
      7.06   Conduct of Business and Maintenance of Existence            37
      7.07   Operation of Business and Properties                        37
      7.08   Access to Properties, Books and Records                     37
      7.09   Environmental Liens                                         38
      7.10   Removal of Hazardous Substances                             38


                                       ii
<PAGE>

                                TABLE OF CONTENTS
                                -----------------

                                                                        PAGE
                                                                        ---- 

       7.11  Further Assurances                                          38

VIII. NEGATIVE COVENANTS                                                 39

       8.01  Incur Indebtedness                                          39
       8.02  Negative Pledge                                             40
       8.03  Sale of Assets; Liquidation; Merger;
             Acquisitions                                                42
       8.04  Intentionally Omitted                                       43
       8.05  Sale-Leaseback Transactions                                 43
       8.06  Prepayment of Other Indebtedness                            44
       8.07  Investments                                                 44
       8.08  Create Subsidiaries                                         44
       8.09  Hazardous Substances                                        44
       8.10  Dividends, Etc                                              45
       8.11  Redemption of Common Stock                                  45
       8.12  Consolidated Stated Net Worth                               45
       8.13  Consolidated Tangible to Stated Net Worth                   45
       8.14  Consolidated Funded Debt to EBITDA Ratio                    46
       8.15  Consolidated Fixed Charges Ratio                            46
       8.16  Transactions with Affiliates                                46
       8.17  Use of Proceeds                                             46
       8.18  Change Fiscal Year                                          46

IX.   EVENTS OF DEFAULT                                                  47

       9.01  Payment Default                                             47
       9.02  Negative Covenant Breach                                    47
       9.03  Other Covenant Breaches                                     47
       9.04  Default Under Agreements for Borrowed Money                 47
       9.05  Default Under Other Material Contracts                      48
       9.06  Voluntary Bankruptcy                                        48
       9.07  Involuntary Bankruptcy                                      48
       9.08  Appointment of Receiver                                     49
       9.09  Insolvency                                                  49
       9.10  Reorganization                                              49
       9.11  Material Misstatement                                       49
       9.12  Entry of Judgment                                           49
       9.13  Change of Control                                           49


                                      iii
<PAGE>



                                TABLE OF CONTENTS
                                -----------------
                                                     
                                                                       PAGE
                                                                       -----
X.  REMEDIES                                                             50
     10.01   Acceleration of Obligations; Other Remedies                 50
     10.02   Right of Set-off                                            50
     10.03   Remedies Cumulative; No Waiver or Impairment                51

XI. MISCELLANEOUS                                                        51

     11.01   Notices                                                     51
     11.02   Costs and Expenses                                          52
     11.03   Payment Due on a Day Other Than a Business Day              52
     11.04   Governing Law                                               52
     11.05   Integration                                                 52
     11.06   Amendment; Waiver                                           53
     11.07   Successors and Assigns                                      53
     11.08   Sale, Assignment or Participations                          53
     11.09   Severability                                                54
     11.10   Consent to Jurisdiction and Service of Process              54
     11.11   Indemnification                                             54
     11.12   Inconsistencies                                             56
     11.13   Headings                                                    56
     11.14   Schedules                                                   56
     11.15   Confidentiality                                             56
     11.16   Judicial Proceeding; Waivers                                56
     11.17   Counterparts                                                57

EXHIBIT A    FORM OF EQUIPMENT LOAN NOTE
EXHIBIT B    FORM OF NOTICE OF BORROWING UNDER EQUIPMENT FACILITY
EXHIBIT C    FORM OF REVOLVING CREDIT NOTE
EXHIBIT D    FORM OF NOTICE OF BORROWING UNDER REVOLVING CREDIT
EXHIBIT E    FORM OF CLOSING DOCUMENT INDEX
EXHIBIT F    FORM OF COMPLIANCE CERTIFICATE
EXHIBIT G    FORM OF SECURITY AGREEMENT
EXHIBIT H    FORM OF LANDLORD CONSENT AND WAIVER
ANNEX I      BORROWER DISCLOSURES




                                       iv

<PAGE>

                EQUIPMENT FACILITY AND REVOLVING CREDIT AGREEMENT


         This EQUIPMENT FACILITY AND REVOLVING CREDIT AGREEMENT (together with
all exhibits hereto and any amendments and modifications hereto in effect from
time to time, this "Agreement") is made as of this 13th day of August, 1997, by
and between SUMMIT BANK (the "Bank") a banking corporation organized under the
laws of the State of New Jersey, and VESTCOM INTERNATIONAL, INC., a New Jersey
corporation (the "Borrower"). All other capitalized terms used herein shall have
the meanings assigned to such terms in Article II hereof.

                                   BACKGROUND
                                   ----------

         WHEREAS, the Borrower has requested that the Bank make available an
equipment purchase facility in the principal amount of up to $5,000,000 for the
purpose of financing the acquisition from time to time of certain equipment to
be used or useful in the ordinary course of the integrated and related business
of the Borrower and its Subsidiaries as presently conducted (the "Financed
Equipment");

         WHEREAS, the Borrower has further requested that the Bank make
available a committed revolving credit facility pursuant to which the Borrower
may request advances from time to time in an aggregate principal amount of up to
$25,000,000 outstanding at any time for the purposes herein specified; and

         WHEREAS, the Bank is willing to make available to the Borrower such
equipment purchase facility and committed revolving credit facility upon the
terms and conditions herein stated;

                                    AGREEMENT
                                    ---------

         NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the Bank and the Borrower agree as follows:

                          I. THE CREDIT ACCOMMODATIONS.
                             --------------------------

         1.01     Equipment Facility. Subject to the terms and conditions herein
                  set forth, during the Equipment Facility Commitment Period,
                  the Bank agrees to make available to the Borrower an equipment
                  finance facility (the "Equipment Facility"), under which the
                  Bank shall make advances (each an "Equipment Loan" and
                  collectively the "Equipment Loans") to the Borrower from time
                  to time to finance the acquisition of the Financed Equipment.
                  


<PAGE>

                  Amounts borrowed under the Equipment Facility and repaid may
                  not be reborrowed. The amounts outstanding under each
                  Equipment Loan shall be evidenced by separate promissory
                  notes, substantially in the form of Exhibit A hereto (together
                  with any attachments thereto and amendments or modifications
                  thereof in effect from time to time, an "Equipment Loan Note"
                  and collectively the "Equipment Loan Notes"). The Equipment
                  Loans shall be Fixed Rate Loans.

         1.02     Equipment Facility Maximum Principal Amount. The maximum
                  aggregate principal amount of Equipment Loans outstanding at
                  any time shall not exceed FIVE MILLION 00/100 DOLLARS
                  ($5,000,000.00), such amount being hereinafter referred to as
                  the "Maximum Equipment Facility Principal Amount". If the
                  aggregate principal amount of Equipment Loans outstanding at
                  any time under the Equipment Facility exceeds the Maximum
                  Equipment Facility Principal Amount, then the Borrower shall
                  immediately repay to the Bank the amount of such excess.

         1.03     Borrowing Procedures Under Equipment Facility. If the Borrower
                  desire to borrow under the Equipment Facility, the Borrower
                  shall give the Bank a notice of the amount and date of such
                  borrowing by no later than 3 Business Days prior to the
                  proposed funding of the relevant Equipment Loan. Such notice
                  shall be in the form of the "Notice of Borrowing Under
                  Equipment Facility" attached hereto as Exhibit B and shall be
                  accompanied by (i) true and complete description of the
                  Financed Equipment to be acquired with the proceeds of the
                  proposed Equipment Loan, the location (or proposed location)
                  of such equipment, the identity of the record owner of such
                  location and if title to such equipment is to be held by a
                  Subsidiary of the Borrower, the identity of such Subsidiary,
                  and (ii) a true and correct copy of the vendor's invoice or
                  bill of sale, as the case may be, rendered in connection with
                  the purchase of such equipment, which shall be accompanied by
                  the payment instructions of such vendor to permit the Bank to
                  fund the proceeds of the relevant Equipment Loan directly to
                  such vendor. Upon receipt of any such notice, the Bank may, in
                  its sole discretion, request any documents or instruments
                  (including, without limitation, additional financing
                  statements, certificate or documents of title and/or
                  additional security agreements substantially in the form of
                  Exhibit G attached hereto that are necessary or advisable in
                  order to assure the Bank's first priority security interest in
                  the relevant Financed Equipment and in connection with such
                  request, the Bank 



                                      -2-

<PAGE>




                  may refuse or postpone the funding of the relevant Equipment
                  Loan until such time as the relevant Borrower has complied
                  therewith. Said Notice of Borrowing Under Equipment Facility
                  shall also specify the desired term of the relevant Equipment
                  Loan, which shall be either 24, 36 or 48 months in duration
                  (each such proposed term, an "Equipment Loan Term"). Promptly
                  upon receipt of said notice, the Bank shall give the Borrower
                  notice of the Fixed Rate to be applicable to the proposed
                  Equipment Loan base upon the desired Equipment Loan Term. The
                  principal amount of any Equipment Loan requested hereunder
                  shall not exceed one hundred percent (100%) of the purchase
                  price of the relevant Financed Equipment as stated on the
                  invoice or bill of sale accompanying the relevant notice of
                  borrowing, but in no event shall any Equipment Loan be in a
                  principal amount of less than $100,000. Notwithstanding
                  anything in this Section 1.03 to the contrary, the obligation
                  of the Bank to fund any Equipment Loan is subject to the
                  satisfaction of the conditions set forth in Section 5.03
                  hereof. The Borrower shall pay to, or reimburse, the Bank on
                  demand the costs incurred in connection with the preparation,
                  filing or recordation of any document or instrument requested
                  pursuant to this Section 1.03 as well as the reasonable costs
                  and expense of Bank's counsel in connection with legal
                  services rendered to assure the Bank's first priority security
                  interest in the relevant Financed Equipment. The
                  aforementioned payment or reimbursement obligation, as the
                  case may be, shall survive the funding of any particular
                  Equipment Loan.

         1.04     Interest on Equipment Loans/Term Loan. Interest on each
                  Equipment Loans shall accrue at the Fixed Rate applicable
                  thereto and be payable monthly, in arrears, on each Payment
                  Date during which such Loan is outstanding, and upon payment
                  in full of the aggregate outstanding balance thereof.

         1.05     Equipment Loans Principal Payment Terms. The outstanding
                  principal balance of each Equipment Loan shall be repaid in
                  consecutive monthly installments and payable on each Payment
                  Date applicable thereto. The amount of each such principal
                  installment will be equal to the amount necessary to amortize
                  the original principal amount of such Equipment Loan (on a
                  straight-line basis) over the Equipment Loan Term applicable
                  thereto. In any event, the final installment of principal
                  applicable thereto shall be due and payable on the applicable
                  Equipment Loan Maturity Date and shall be in an amount equal
                  to the then remaining unpaid



                                      -3-
<PAGE>

                  principal balance thereof, together with any accrued and
                  unpaid interest thereon.

         1.06     The Revolving Credit Facility. Subject to the terms and
                  conditions hereof, the Bank agrees to make available to the
                  Borrower, a revolving credit facility (the "Revolving Credit
                  Facility") under which the Bank shall make advances to the
                  Borrower from time to time during the Revolving Credit
                  Commitment Period in an aggregate principal amount outstanding
                  at any one time of up to TWENTY-FIVE MILLION 00/100 DOLLARS
                  ($25,000,000.00) (each a "Revolving Credit Loan" and
                  collectively the "Revolving Credit Loans"). During the
                  Revolving Credit Commitment Period, the Borrower may borrow,
                  repay and reborrow as provided herein. Revolving Credit Loans
                  may be made as Alternate Base Rate Loans or LIBOR Loans, as
                  requested by the Borrower pursuant to Section 1.12 hereof. The
                  Revolving Credit Loans shall be evidenced by a single
                  promissory note, substantially in the form of Exhibit C hereto
                  (together with any attachments thereto and/or amendments or
                  modifications thereof in effect from time to time, the
                  "Revolving Credit Note"). The Revolving Credit Commitment
                  Period may be extended for an additional period not to exceed
                  3 years in the sole and absolute discretion of the Bank. The
                  Borrower shall be notified of the Bank's decision to so extend
                  the Revolving Credit Commitment Period by a date occurring no
                  later than 14 months prior to the Revolving Credit Expiration
                  Date then in effect. For the avoidance of doubt, it is hereby
                  acknowledged that the Bank's agreement to so extend the
                  Revolving Credit Commitment Period may be subject to the
                  acceptance by the Borrower of such additional terms and
                  conditions, or the modification of the existing terms and
                  conditions, of the Revolving Credit Facility as the Bank may
                  impose in its sole and absolute discretion.

         1.07     Revolving Credit Facility Maximum Principal Amount. The
                  maximum aggregate principal amount of the Revolving Credit
                  Loans outstanding at any time, when added to the Letter of
                  Credit Outstanding at such time shall not exceed TWENTY FIVE
                  MILLION 00/100 DOLLARS ($25,000,000.00) such amount being
                  hereinafter referred to as the "Maximum Revolving Credit
                  Principal Amount". If the aggregate outstanding principal
                  amount of the Revolving Credit Loans plus the Letters of
                  Credit Outstanding at any time exceed the Maximum Revolving
                  Credit Principal Amount, the Borrower shall immediately repay
                  to the Bank the amount of such excess.



                                      -4-

<PAGE>


         1.08     Letter of Credit Sub-Facility. Within the limitations of
                  the Revolving Credit Facility herein set forth, the Borrower
                  may from time to time request that the Bank issue irrevocable
                  standby or commercial letters of credit for the account of the
                  Borrower and in support of any obligation deemed acceptable by
                  the Bank in its sole discretion (any such letter of credit so
                  issued, a "Letter of Credit" and collectively the "Letters of
                  Credit"). Notwithstanding the foregoing (i) no Letter of
                  Credit shall be issued by the Bank in a Stated Amount which
                  (x) when added to the Letters of Credit Outstandings at such
                  time, would exceed $2,000,000.00 or (y) when added to the sum
                  of the aggregate outstanding principal amount of the Revolving
                  Credit Loans plus the Letter of Credit Outstandings, at such
                  time, would exceed the Maximum Revolving Credit Principal
                  Amount. Each Letter of Credit issued in accordance herewith
                  shall have an expiration date occurring no later than 1 year
                  from the date of issuance and in any event no later than (i) 6
                  months, in the case of commercial letter of credit, or (ii) 1
                  year, in the case of irrevocable automatically renewable
                  letter of credit, after the Revolving Credit Expiration Date.
                  Each Letter of Credit shall be denominated in U.S. dollars.
                  When a Borrower desires that a Letter of Credit be issued for
                  its account, it shall give the Bank at least 3 Business Days'
                  written notice (or such lesser number of days as may be agreed
                  to by the Bank). Each such request shall be accompanied by a
                  completed and executed "Letter of Credit Application/
                  Agreement" (or an amendment to any then effective application)
                  in the form furnished by the Bank to the Borrower from time to
                  time. The terms of each such application/agreement are
                  incorporated herein to the extent not consistent herewith. In
                  connection with the issuance of any Letters of Credit in
                  accordance herewith, the Borrower shall pay all letters of
                  credit fees and other expenses that are customarily charged by
                  the Bank in connection therewith.

         1.09     Interest on Revolving Credit Loans. Interest on each Revolving
                  Credit Loan that is an Alternate Base Rate Loan shall accrue
                  at the Alternate Base Rate plus the Applicable Margin, if any,
                  and shall be payable monthly, in arrears, on each Payment Date
                  during which such Loan is outstanding, and upon payment in
                  full of the outstanding balance of such Loan. Interest on each
                  Revolving Credit Loan that is a LIBOR Loan shall accrue at
                  LIBOR plus the Applicable Margin and shall be payable, in
                  arrears, on each Payment Date during which

                                      -5-


<PAGE>

                  such Loan is outstanding, and upon payment in full of the
                  outstanding balance of such Loan.

         1.10     Revolving Credit Principal Payment Terms. The aggregate
                  outstanding principal balance of the Revolving Credit Loans,
                  together with all accrued and unpaid interest thereon, shall
                  be due and payable on the Revolving Expiration Date.

         1.11     Borrowing Procedures Under the Revolving Credit Facility. If
                  the Borrower desires to borrow under the Revolving Credit
                  Facility, the Borrower shall give the Bank irrevocable written
                  notice of the amount and date of such borrowing no later than
                  1 Business Day prior to the date of such proposed borrowing in
                  the case of Alternate Base Rate Loans and 2 Business Days
                  prior to the date of such proposed borrowing in the case of
                  LIBOR Loans. Such notice shall be in the form of a "Notice of
                  Borrowing Under Revolving Credit" attached hereto as Exhibit
                  D. Each borrowing under the Revolving Credit Facility shall be
                  in an amount equal to $100,000 or any whole multiple thereof.
                  The Borrower shall not be permitted to request a Revolving
                  Credit Loan in the form of a LIBOR Loan, if the making of such
                  Loan would cause the aggregate number of LIBOR Loans
                  outstanding under the Revolving Credit Facility to exceed 10
                  at such time.

         1.12     Revolving Credit Interest Conversion and Continuance Options.

                  (a) Subject to the limitation of the last sentence of Section
                  1.11 hereof, during the Revolving Credit Commitment Period,
                  the Borrower may elect to convert any Revolving Credit Loan to
                  a Loan maintained at the other rate of interest available for
                  Revolving Credit Loans hereunder by giving the Bank
                  irrevocable notice (which may be telephone notice promptly
                  confirmed in writing) of such election at least 2 Business
                  Days prior to the conversion to a LIBOR Loan and at least 1
                  Business Day prior to the conversion to a Alternate Base Rate
                  Loan. Said notice shall specify, in the case of a conversion
                  to a LIBOR Loan, the desired Interest Period with respect
                  thereto, which shall be either 1, 2, 3 or 6 months in duration
                  as selected by the Borrower. Conversions of LIBOR Loans to
                  Alternate Base Rate Loans shall be made only on the last day
                  of the Interest Period applicable thereto. Conversions of
                  Alternate Base Rate Loans to LIBOR Loans shall only be made on
                  a Business Day.



                                      -6-
<PAGE>

                  (b) During the Revolving Credit Commitment Period, the
                  Borrower may elect to continue any Revolving Credit Loan that
                  is a LIBOR Loan as such type of Loan upon the expiration of
                  the then current Interest Period with respect thereto by
                  giving the Bank an irrevocable notice (which may be telephone
                  notice promptly confirmed in writing) of such election at
                  least 2 Business Days prior to the expiration of the then
                  current Interest Period with respect thereto. Such notice
                  shall also specify the desired Interest Period for the Loan so
                  continued, which may be 1, 2, 3 or 6 months in duration as
                  selected by the Borrower.

                  (c) If the Borrower fails to notify the Bank of the conversion
                  or continuance of any LIBOR Loan within the time specified in
                  this Section 1.13, then any such Loan shall automatically
                  convert to an Alternate Base Rate Loan on the last day of the
                  then expiring applicable Interest Period.

         1.13     Arrangement Fees. The Borrower shall pay, or have paid, to the
                  Bank on or before the Closing Date a one time arrangement fee
                  in an amount equal to $75,000. The Borrower acknowledges that
                  such fee is a liquidated sum and, together with the amounts
                  payable pursuant to Section 11.02 hereof, constitute
                  reasonable compensation to the Bank for its expenses and
                  services in connection with the arrangement of the facilities
                  provided hereunder and the negotiation and preparation of this
                  Agreement and the other Credit Documents.

         1.14     Commitment Fee. The Borrower shall pay to the Bank, quarterly
                  in arrears, a commitment fee for the period beginning from and
                  including the date that is 6 months from the Closing Date (the
                  "Commitment Fee Commencement Date") until the Revolving Credit
                  Expiration Date, computed for each quarter occurring in said
                  period at a per annum rate equal to the Applicable Commitment
                  Fee multiplied by the average daily amount of the Availability
                  for such quarter. Such commitment fee shall be payable
                  commencing on May 1, 1998 and continuing quarterly on the
                  first Business Day of February, May, August, and November
                  occurring thereafter and on the Revolving Credit Expiration
                  Date. Any such payment shall be in respect of the immediately
                  preceding full fiscal quarter then last ended, except for the
                  initial payment which shall be respect of the period
                  commencing on the Commitment Fee Commencement Date through the
                  last day of the fiscal quarter then last ended.




                                      -7-

<PAGE>


         1.15     Computation. Interest and any fees or compensation based upon
                  a per annum rate shall be calculated on the basis of a 360 day
                  year for the actual number of days elapsed.

         1.16     Payments Generally; Debiting of Account. All payments made
                  hereunder shall be paid in accordance with the payment terms
                  set forth in the Notes. Without limiting the generality of the
                  foregoing, the Borrower agrees to maintain a demand deposit
                  account at the Bank (the "Account") continuously until the
                  Obligations due hereunder are paid in full. The Bank may, and
                  the Borrower authorizes the Bank to, debit the Account for the
                  amount of any payment as and when such payment becomes due
                  hereunder. At any time during the continuance of an Event of
                  Default, the Bank may, and the Borrower authorizes the Bank to
                  debit any other account and/or certificate of deposit
                  maintained by the Borrower with the Bank for the amount of any
                  payment, as and when such payment becomes due hereunder,
                  whether such payment is for accrued interest, principal or
                  expense, even if debiting such account results in a loss or
                  reduction of interest to the Borrower or the imposition of a
                  penalty applicable to the early withdrawal of time deposits.
                  Such authorization shall not affect the Borrower's obligation
                  to pay when due all amounts payable hereunder, whether or not
                  there are sufficient funds in any accounts of the Borrower.
                  The Borrower agrees to fund the Account from time to time in
                  amounts sufficient to make any regularly scheduled payments of
                  principal and interest hereunder as and when such payments
                  become due. The foregoing rights of the Bank to debit the
                  Borrower's accounts shall be in addition to, and not in
                  limitation of, any rights of set-off which the Bank may have
                  hereunder or under any Credit Document.

                                II. DEFINITIONS.
                                    ------------

         2.01     Defined Terms. The following terms used throughout this
                  Agreement shall have the meanings assigned below:

                  Affiliate. The term "Affiliate" means, as applied to any
                  Person, any other Person that directly or indirectly controls,
                  is controlled by, or is under common control with, that
                  Person. For purposes of this definition, "control" (including,
                  with correlative meanings, the terms "controlling",
                  "controlled by" and "under common control with"), as applied
                  to any Person, means the possession, directly or indirectly,
                  of the power to vote 



                                      -8-
<PAGE>


                  twenty-five percent (25%) or more of the securities or other
                  ownership interests having voting power for the election of
                  directors (or other persons performing similar functions) of
                  such Person or otherwise to direct or cause the direction of
                  the management and policies of that Person, whether through
                  the ownership of voting securities or by contract or
                  otherwise.

                  Alternate Base Rate. The term "Alternate Base Rate" means the
                  higher of the Announced Base Rate or the Federal Funds Rate.

                  Alternate Base Rate Loan. The term "Alternate Base Rate Loan"
                  means any Loan at all times during which such Loan bears
                  interest based upon the Alternate Base Rate.

                  Announced Base Rate. The term "Announced Base Rate" means the
                  per annum rate of interest established by the Bank as its
                  reference rate in making loans, and does not reflect the rate
                  of interest charged to any particular borrower or class of
                  borrowers. The Borrower acknowledges that the Announced Base
                  Rate is not tied to any external rate of interest and that the
                  rate of interest charged hereunder (if any) which is based on
                  the Announced Base Rate shall change automatically and
                  immediately as of the date of any change in the Announced Base
                  Rate, without notice to the Borrower.

                  Applicable Commitment Fee. The term "Applicable Commitment
                  Fee" means from and after the first day of any Applicable
                  Margin Adjustment Period to and including the last day of such
                  Applicable Margin Adjustment Period, the Applicable Commitment
                  Fee determined by reference to the table appearing in the
                  definition of "Applicable Margin".

                  Applicable Margin. The term "Applicable Margin" means
                  initially the percentage corresponding to the Consolidated
                  Funded Debt to EBITDA Ratio of the Borrower set forth on the
                  table set forth below based on the quarterly financial
                  statements for the fiscal period ending as of June 30, 1997,
                  provided, however, that from and after the first day of any
                  Applicable Margin Adjustment Period to and including the last
                  day of such Applicable Margin Adjustment Period, the
                  Applicable Margin shall be determined by reference to
                  percentages corresponding to the Consolidated Funded Debt to
                  EBITDA Ratio of the Borrower for the Test Period last ended,
                  in accordance with the following table:


                                      -9-
<PAGE>
<TABLE>
<CAPTION>

                                                                                             Applicable
                                                                   Applicable                Margin for
If Such Ratio                                                      Margin for LIBOR          Alternate Base
Is:                             Commitment Fee                     Loans                     Rate Loans
--------------                  --------------                     ----------------          ---------------
<S>                            <C>                                 <C>                       <C>  
Less than 1.15                  25 basis points                    100 basis points
to 1.00                         (.25%)                             (1.00%)                        -0-

Greater than or                 25 basis points                    125 basis points               -0-
equal to 1.15 to                (.25%)                             (1.25%)
1.00, but less
than 1.5 to 1.00
1.00

Greater than or                 30 basis points                    150 basis points          25 basis points 
equal to 1.50 to                (.30%)                             (1.50%)                   (.25%)  
1.00, but less
than 2.00 to
1.00

Greater than or                 37.5 basis points                  175 basis points          50 basis points 
equal to 2.0 to                 (.375%)                            (1.75%)                   (.50%)  
1.00, but less
than 2.5 to 1.00

Greater than or                 50 basis points                    225 basis points          100 basis points 
equal to 2.5 to                 (.50)%                             (2.25%)                   (1.00%)
1.00

</TABLE>

                  Notwithstanding the foregoing, at all times during which there
                  exists an Event of Default, the Applicable Margin (A) with
                  respect to Alternate Base Rate Loans, shall be 100 basis
                  points (1.00%) and (B) with respect to LIBOR Loans, shall be
                  225 basis points (2.25%), and said margin shall be in addition
                  to any margin added to the applicable rate of interest to
                  calculate the "Default Rate" pursuant to the relevant Note.

                  Applicable Margin Adjustment Period means (A) with respect to
                  the determination of the Applicable Commitment Fee, initially
                  the period commencing 6 months from the Closing Date and
                  ending on the last day of the then current fiscal quarter and
                  thereafter each fiscal quarter occurring thereafter and (B)
                  with respect to the determination of the Applicable Margin,
                  initially the period commencing October 1, 1997 and ending
                  December 31, 1997 and thereafter each fiscal quarter occurring
                  thereafter.

                  Approved Subordinated Indebtedness. The term "Approved
                  Subordinated Indebtedness" means any Indebtedness of the
                  Borrower that (i) is subordinated to the Obligations on 


                                      -10-
<PAGE>


                  terms and conditions approved in writing by the Bank and (ii)
                  does not constitute Guaranteed Indebtedness of the Borrower or
                  any of its Subsidiaries or Affiliates.

                  Availability. The Term "Availability" means, as of any
                  relevant date, the amount by which the Maximum Revolving
                  Credit Amount exceeds the amount of the aggregate outstanding
                  principal amount of the Revolving Credit Loan.

                  Business Day. The term "Business Day" means any day other than
                  a Saturday, Sunday, or a day on which commercial banks are
                  authorized or obligated by law or executive order to be closed
                  in the State of New Jersey.

                  Capital Expenditures. The term "Capital Expenditure" means,
                  with respect to any Person, without duplication and for any
                  period, the aggregate value attributed in accordance with
                  GAAP, to acquisitions during such period by such Person of any
                  asset, tangible or intangible, or replacements or
                  substitutions therefor or additions thereto which such Person
                  treated as a non-current asset on such Person's financial
                  statement, including, without limitation, (x) the acquisition
                  or construction of assets having a useful life of more than 1
                  year and (y) assets acquired during such period in connection
                  with Capitalized Leases.

                  Capitalized Lease. The term "Capitalized Lease" means any
                  lease with respect to which the obligation to pay rent or
                  other amounts constitutes Capitalized Lease Obligations.

                  Capitalized Lease Obligations. The term "Capitalized Lease
                  Obligations" means obligations to pay rent or other amounts
                  under a lease of (or other agreement conveying the right to
                  use) real and/or personal property which obligations are
                  required to be classified and accounted for as capital leases
                  on a balance sheet in accordance with GAAP.

                  Closing Date. The term "Closing Date" means the date on which
                  the conditions set forth in Section 5.01 hereof have been
                  fulfilled to the satisfaction of the Bank.

                  Confidential Information. The term "Confidential Information"
                  means information furnished to the Bank on a confidential
                  basis by or on behalf of the Borrower and designated as such,
                  but does not include any such information that is or becomes
                  generally available to


                                      -11-


<PAGE>

                  the public (other than through any breach of any
                  confidentiality undertaking hereunder or in connection
                  therewith) or that legally is or becomes available to the Bank
                  from a source other than the Borrower.

                  Consolidated. The term "Consolidated" means an accounting
                  presentation which includes the consolidated Subsidiaries of
                  the Borrower prepared in accordance with GAAP, consistently
                  applied.

                  Consolidated EBITDA. The term "Consolidated EBITDA" means the
                  Borrower's earnings (excluding any extraordinary or
                  nonrecurring items) before interest expense, taxes,
                  depreciation and amortization, determined for the relevant
                  Test Period on a Consolidated basis in accordance with GAAP,
                  consistently applied.

                  Consolidated Fixed Charges Ratio. The term "Consolidated Fixed
                  Charges Ratio" means the ratio of (i) the Borrower's
                  Consolidated EBITDA less unfinanced Capital Expenditures to
                  (ii) the Current Maturities of the Borrower's Funded Debt plus
                  all cash and non-cash interest (including, without limitation,
                  capitalized interest) payable during the relevant Test Period
                  on or in connection with any Indebtedness of the Borrower of
                  any type, in each case determined for the relevant Test Period
                  on a Consolidated basis in accordance with GAAP, consistently
                  applied.

                  Consolidated Funded Debt to EBITDA Ratio. The term
                  "Consolidated Funded Debt to EBITDA Ratio" means the ratio of
                  (A) the Borrower's Funded Debt to (B) the Borrower's
                  Consolidated EBITDA, in each case determined for the relevant
                  Test Period on a Consolidated basis in accordance with GAAP,
                  consistently applied.

                  Consolidated Stated Net Worth. The term "Consolidated Stated
                  Net Worth" means, at any time:

                           (a) the total assets of the Borrower which would be
                           shown as assets on a Consolidated balance sheet of
                           the Borrower, prepared in accordance with GAAP,
                           consistently applied,

                           minus

                           (b) the total liabilities of the Borrower which would
                           be shown as liabilities on a Consolidated 



                                      -12-
<PAGE>

                           balance sheet of the Borrower, prepared in accordance
                           with GAAP, consistently applied.

                  Consolidated Tangible Net Worth. The term "Consolidated
                  Tangible Net Worth" mean, at any time:

                           (a) the total assets of the Borrower which would be
                           shown as assets on a Consolidated balance sheet of
                           the Borrower and its Subsidiaries, prepared in
                           accordance with GAAP, consistently applied, after
                           subtracting therefrom the aggregate amount of any
                           capitalized research and development costs;
                           capitalized interest; debt discount and expense;
                           goodwill; patents; trademarks; copyrights;
                           franchises; licenses; amounts owing from officers;
                           directors, or other Affiliates of the Borrower; and
                           any investments in any Affiliate of any of the
                           foregoing; and such other assets as are properly
                           classified as "intangible assets" determined in
                           accordance with GAAP, consistently applied,

                           minus

                           (b) the total liabilities of the Borrower which would
                           be shown as liabilities on a Consolidated balance
                           sheet of the Borrower, prepared in accordance with
                           GAAP, consistently applied.

                  Credit Documents. The term "Credit Documents" means this
                  Agreement, each Equipment Loan Note, the Revolving Credit
                  Note, the Security Agreements, the Guaranties, any Letters of
                  Credits and any letter of credit agreement/application
                  executed in connection with the issuance thereof, each of the
                  other documents, referenced in the Closing Checklist attached
                  hereto as Exhibit E, each of the "Credit Documents" referenced
                  therein, and all other all credit accommodations, notes, loan
                  agreements, guaranties, security agreements, mortgages,
                  instruments, pledge agreements, assignments, acceptance
                  agreements, commitments, facilities, letters of credit,
                  reimbursement agreements and any other agreements and
                  documents, of the Borrower, any Guarantor, with or in favor
                  of, the Bank, in each case now or hereafter existing,
                  creating, evidencing, guarantying, securing or relating to any
                  or all of the Obligations, together with in each case all
                  amendments, modifications, renewals, or extensions thereof.

                  Current Maturities. The term "Current Maturities" means with
                  respect to any item of Indebtedness, the portion of such
                  Indebtedness which by the terms of such 


                                      -13-

<PAGE>

                  Indebtedness or the terms of any instrument or agreement
                  related thereto was due and payable during the relevant Test
                  Period, whether such payment is required by a demand which may
                  be made during such Test Period, regularly scheduled principal
                  payments, mandatory prepayment, sinking fund requirements or
                  final payment at maturity.

                  Environmental Laws. The term "Environmental Laws" means all
                  applicable laws, regulations and other requirements of
                  Governmental Authorities relating to pollution or protection
                  of the environment, including laws relating to emissions,
                  discharges, releases or threatened releases of pollutants,
                  contaminants, or hazardous or toxic materials or wastes into
                  ambient air, surface water, ground weather, or land, or
                  otherwise relating to the disposal, transport, or handling of
                  pollutants, contaminants, or hazardous or toxic material or
                  wastes.

                  Equipment Facility. The term "Equipment Facility" shall have
                  the meaning assigned to such term in Section 1.01 hereof.

                  Equipment Facility Commitment Period. The term "Equipment
                  Facility Commitment Period" means the period commencing on the
                  Closing Date and ending on the Equipment Facility Expiration
                  Date.

                  Equipment Facility Expiration Date. The term "Equipment
                  Facility Expiration Date" means the date that is the earlier
                  to occur of (i) the third anniversary of the Closing Date,
                  (ii) the date on which the Maximum Equipment Facility Amount
                  has been funded by the Bank, or (iii) the date on which this
                  Agreement is terminated pursuant to Section 3.03 hereof.

                  Equipment Loan and Equipment Loans. The terms "Equipment Loan"
                  and "Equipment Loans" shall have the meanings assigned to such
                  terms in Section 1.01 hereof.

                  Equipment Loan Maturity Date. The term "Equipment Loan
                  Maturity Date" means, with respect to any particular Equipment
                  Loan, the date on which the Equipment Loan Term applicable
                  thereto shall have expired.

                  Equipment Loan Note and Equipment Loan Notes. The terms
                  "Equipment Loan Note" and "Equipment Loan Notes" shall have
                  the meaning assigned to such terms in Section 1.01 hereof.



                                      -14-


<PAGE>

                  Equipment Loan Term. The term "Equipment Loan Term" shall have
                  the meaning assigned to such term in Section 1.03 hereof.

                  Event of Default. The term "Event of Default" shall have the
                  meaning assigned to such term in Article IX hereof.

                  Facilities Management Arrangements. The term "Facilities
                  Management Arrangements" means any written contractual
                  undertaking of the Borrower or any of its Subsidiaries
                  pursuant to which the Borrower or any of its Subsidiaries is
                  to perform services substantially similar to the services
                  rendered by the Borrower or any of its Subsidiary in the
                  ordinary course of their respective businesses at a facility
                  that is owned or otherwise operated by a Person other than the
                  Borrower or any of its Subsidiaries and in connection with the
                  rendition of such services, the Borrower or any of its
                  Subsidiaries, as the case may be, acquires title to, or
                  assumes Indebtedness secured by a Lien upon, the equipment and
                  machinery located at such facility.

                  Federal Funds Rate. The term "Federal Funds Rate" means, for
                  any period, a fluctuating interest rate equal for each day
                  during such period to 50 basis points (.50%) above the
                  weighted average of the rates on overnight Federal Funds
                  transactions with members of the Federal Reserve System
                  arranged by Federal Funds brokers, as published by the Federal
                  Reserve Bank of New York on the Business Day next preceding
                  such day for amounts in immediately available funds comparable
                  to the principal amount of the relevant indebtedness or, if
                  such rate is not so published for any day for which the next
                  preceding day is a Business Day, the average of the quotations
                  for such day on such transactions received by the Bank from
                  three (3) Federal Funds brokers of recognized standing
                  selected by the Bank.

                  Financed Equipment. The term "Financed Equipment" shall have
                  the meaning assigned to such term in the first recital clause
                  of this Agreement.

                  Fixed Rate. The term "Fixed Rate" means, for each Equipment
                  Loan, the per annum rate of interest equal to 200 basis points
                  (2.00%) above the average asked yield for "Govt. Bonds &
                  Notes", as set forth in the column designated "Treasury Bonds,
                  Notes & Bills" in The Wall Street Journal most recently
                  published as of the date that is 2 Business Days prior to the
                  proposed date of 


                                      -15-


<PAGE>

                  funding of the relevant Equipment Loan, having a maturity date
                  that falls in the same month applicable Equipment Loan
                  Maturity Date, provided that if no such yield is published for
                  the relevant month, yields for the published month next
                  succeeding and the published month next preceding such month
                  shall be used to determine the Fixed Rate by interpolating
                  such yields on a straight-line basis. If The Wall Street
                  Journal at the time determination of the Fixed Rate is no
                  longer publishing the yields described above, then the Bank
                  shall determine such yield based on any other nationally
                  recognized source for such published yields as it may select
                  in its reasonable discretion.

                  Fixed Rate Loan. The term "Fixed Rate Loan" means each
                  Equipment Loan at all time during which such Loan bears
                  interest based upon the Fixed Rate.

                  Funded Debt. The term "Funded Debt" means, with respect to any
                  Person, without duplication, (i) indebtedness of such Person
                  for borrowed money, (ii) obligations of such Person evidenced
                  by bonds, debentures, notes, or other similar instruments,
                  (iii) obligations of such Person to pay the deferred purchase
                  price of property or services (other than accounts payable to
                  trade creditors and current operating liabilities incurred in
                  the ordinary course of business), and (iv) Capitalized Lease
                  Obligations of such Person, as lessee.

                  GAAP. The term "GAAP" means generally accepted accounting
                  principles in effect from time to time in the United States.

                  Governmental Authority. The term "Governmental Authority"
                  means any nation or government, any state or other political
                  subdivision thereof and any entity exercising executive,
                  legislative, judicial, regulatory or administrative functions
                  of or pertaining to government.

                  Guaranteed Indebtedness. The term "Guaranteed Indebtedness"
                  means, as to any Person, all Indebtedness of the type referred
                  to in clauses (i) through (ix) of the definition of
                  Indebtedness in this Agreement guaranteed directly or
                  indirectly in any manner by such Person, or in effect
                  guaranteed directly or indirectly by such Person, or in effect
                  guaranteed directly or indirectly by such Person through an
                  agreement (i) to pay or purchase such Indebtedness or to
                  advance or supply funds for the payment or purchase of such
                  Indebtedness, (ii) to purchase, sell or lease (as lessee 


                                      -16-

<PAGE>

                  or lessor) property, or to purchase or sell services,
                  primarily for the purpose of enabling the debtor to make
                  payment of such Indebtedness or to assure the holder of such
                  Indebtedness against loss, (iii) to supply funds to or in any
                  other manner invest in the debtor (including any agreement to
                  pay for property or services irrespective of whether or not
                  such property is received or such services are rendered), or
                  (iv) otherwise to assure a creditor against loss. For the
                  avoidance of doubt, it is acknowledged that if the Borrower or
                  any Guarantor is permitted to incur any Indebtedness
                  hereunder, it is also permitted to guaranty such Indebtedness
                  if incurred by the Borrower or any other Guarantor.

                  Guarantors. The term "Guarantors" means collectively, Computer
                  Output Systems, Inc., a Connecticut corporation, Comvestrix
                  Corp., a Delaware corporation, Electronic Imaging Services,
                  Inc., a Delaware corporation, Image Printing Systems, Inc., a
                  Wisconsin corporation, Direct Mail Services, Inc., a New
                  Jersey corporation, Quality Control Printing, Inc., a New
                  Jersey corporation, First Class Presort, Inc., a New Jersey
                  corporation, Mystic Graphic Systems, Inc., a Massachusetts
                  corporation, 504087 N.B. Inc., a New Brunswick (Canada)
                  corporation, Lirpaco, Inc., a Canadian corporation, Cos
                  Information Inc., a Canadian corporation, and any Subsidiary
                  of the Borrower that becomes a guarantor of the Obligations in
                  accordance with Section 8.08 hereof.

                  Guaranties. The term "Guaranties" means collectively Guaranty
                  and Suretyship Agreements executed by the Guarantors in favor
                  of the Bank on even date herewith and any other guaranty and
                  suretyship agreement executed and delivered by any other
                  Subsidiary of the Borrower pursuant to Section 8.08 hereof.

                  Indebtedness. The term "Indebtedness" means, as to any Person
                  (i) all indebtedness of such Person for borrowed money, (ii)
                  all obligations of such Person evidenced by bonds, debentures,
                  notes, or other similar instruments, (iii) all obligations of
                  such Person to pay the deferred purchase price of property or
                  services (other than accounts payable to trade creditors and
                  current operating liabilities incurred in the ordinary course
                  of business), (iv) all indebtedness created or arising under
                  any conditional sale or other title retention agreement with
                  respect to property acquired by such Person (even though the
                  rights and remedies of the seller or lender under such
                  agreement in the event of 



                                      -17-

<PAGE>


                  default are limited to repossession or sale of such property),
                  (v) all Capitalized Lease Obligations of such Person, as
                  lessee, (vi) all obligations, contingent or otherwise, of such
                  Person under acceptances, letters of credit or similar
                  facilities, (vii) all obligations of such Person to purchase,
                  redeem, retire, defease or otherwise acquire for value any
                  capital stock of such person or any warrants, rights or
                  options to acquire such capital stock, valued, in the case of
                  redeemable preferred stock, at the greater of its voluntary or
                  involuntary liquidation preference plus accrued and unpaid
                  dividends, (viii) all obligations of such Person in respect of
                  interest rate swap agreements (as defined in 11 U.S.C.
                  ss.101), currency swap agreements and other similar agreements
                  designed to hedge against fluctuations in interest rates or
                  foreign exchange rates, (ix) all obligations of production
                  payments from property operated by or on behalf of such Person
                  and other similar arrangements with respect to natural
                  resources, (x) all Guaranteed Indebtedness of such Person, and
                  (xi) all Indebtedness of the type referred to in clauses (i)
                  through (x) above secured by (or for which the holder of such
                  Indebtedness has an existing right, contingent or otherwise,
                  to be secured by) any Lien on property (including, without
                  limitation, accounts and contracts rights) owned by such
                  Person, even though such Person has not assumed or become
                  liable for the payment of such Indebtedness.

                  Interest Period. The term "Interest Period" means, with
                  respect to any LIBOR Loan:

                  (a) initially, the period commencing on, as the case may be,
                  the date of borrowing or conversion with respect to such LIBOR
                  Loan and ending 1, 2, 3 or 6 months thereafter as selected by
                  the relevant Borrower in its notice of borrowing as provided
                  in Section 1.11 hereof or its notice of conversion as provided
                  in Section 1.12(a) hereof; and

                  (b) thereafter, each period commencing on the last day of the
                  next preceding Interest Period applicable to such LIBOR Loan
                  and ending 1, 2, 3 or 6 months thereafter as selected by the
                  relevant Borrower in its notice of continuance as provided in
                  Section 1.12(b) hereof;

                  provided that the foregoing provisions relating to Interest
                  Periods are subject to the following:

                           (i) if any Interest Period pertaining to a LIBOR Loan
                           would otherwise end on a day which is not a 


                                      -18-


<PAGE>

                           Business Day, that Interest Period shall be extended 
                           to the next succeeding Business Day unless the result
                           of such extension would be to carry such Interest 
                           Period into another calendar month in which even such
                           Interest Period shall end on the immediately
                           preceding Business Day;

                           (ii) any Interest Period pertaining to a LIBOR Loan
                           that begins on the last Business Day of a calendar
                           month (or on a day for which there is no numerically
                           corresponding day in the calendar month at the end of
                           such Interest Period) shall end on the last Business
                           Day of a calendar month; and

                           (iii) no Borrower shall select any Interest Period
                           that would extend such Interest Period beyond the
                           Revolving Credit Expiration Date.

                  Investments. The term "Investment" shall have the meaning
                  assigned to such term in Section 8.07 hereof.

                  Letter of Credit and Letters of Credit. The terms "Letter of
                  Credit" and "Letters of Credit" shall have the meanings
                  assigned to such terms in Section 1.08 hereof.

                  Letter of Credit Outstanding. The term "Letter of Credit
                  Outstanding" means, at any time, the sum of, without
                  duplication (i) the aggregate Stated Amount of all outstanding
                  Letters of Credit; (ii) the aggregate amount of all
                  unreimbursed drawing thereunder; and (iii) the Stated Amount
                  of all Letters of Credit requested in accordance with Section
                  1.08 hereof but not yet issued.

                  LIBOR. The term "LIBOR" means, with respect to each day during
                  each Interest Period, the rate (rounded to the next higher
                  1/100 of 1%) for U.S. dollar deposits with a maturity equal to
                  the relevant Interest Period in the London interbank market as
                  determined by the Bank from a recognized source for quotations
                  of the London interbank offered rate, on the second London
                  business day before the relevant Interest Period begins,
                  adjusted for reserves by dividing that rate by 1.00 minus the
                  LIBOR Reserve.

                  LIBOR Loan. The term "LIBOR Loan" means any Revolving Credit
                  Loan at all times during which such Loan bears interest based
                  upon LIBOR.

                  LIBOR Reserve. The term "LIBOR Reserve" means the maximum
                  percentage reserve requirement (rounded to the 


                                      -19-

<PAGE>

                  next higher 1/100 of 1% and expressed as a decimal) in effect
                  for any day during the relevant Interest Period under the
                  Federal Reserve Board's Regulation D for Eurocurrency
                  liabilities as defined therein.

                  Lien. The term "Lien" means any mortgage, pledge, security
                  interest, encumbrance, lien or other form of charge or
                  preferential arrangement of any kind (including, without
                  limitation, any agreement to give any of the foregoing, any
                  conditional sale or other title retention or any lease in the
                  nature thereof).

                  Loan. The term "Loan" means a Revolving Credit Loan or an
                  Equipment Loan, as the context shall require, and the term
                  "Loans" means, collectively, the Revolving Credit Loans and
                  the Equipment Loans.

                  Material Adverse Effect. The term "Material Adverse Effect"
                  means a material adverse effect on (a) the business,
                  operations, property, condition (financial or otherwise) of
                  the Borrower and its Subsidiaries taken as a whole, (b) the
                  ability of the Borrower to perform its obligations under this
                  Agreement, the Notes or any of the other Credit Documents, or
                  (c) the validity or enforceability of this Agreement, the
                  Notes or any of the other Credit Documents, or the rights or
                  remedies of the Bank hereunder or thereunder.

                  Maximum Equipment Facility Principal Amount. The term "Maximum
                  Equipment Facility Principal Amount", shall have the meaning
                  assigned to such term in Section 1.02 hereof.

                  Maximum Revolving Credit Principal Amount. The term "Maximum
                  Revolving Credit Principal Amount" shall have the meaning
                  assigned to such term in Section 1.08 hereof.

                  Note. The term "Note" means an Equipment Loan Note or the
                  Revolving Credit Note, as the context shall require, and the
                  term "Notes" means, collectively, the Equipment Loan Notes and
                  the Revolving Credit Note.

                  Obligations. The term "Obligations" means any and all
                  obligations and indebtedness of every kind and description of
                  the Borrower owing to the Bank, whether under the Credit
                  Documents or other loan documents or agreements, and whether
                  such debts or obligations are primary or secondary, direct or
                  indirect, absolute or contingent, sole, joint or several,
                  secured or 


                                      -20-

<PAGE>


                  unsecured, due or to become due, contractual or tortious,
                  arising by operation of law or otherwise, or now or hereafter
                  existing, including, without limitation, principal interest,
                  fees, late fees, expenses, and/or attorneys' fees and costs
                  (to the extent reimbursable to the Bank by the Borrower
                  pursuant to Section 11.02), that have been or may hereafter be
                  contracted or incurred.

                  OEM Equipment Finance Transactions. The term "OEM Equipment
                  Finance Transactions" means equipment lease or purchase money
                  financing with respect to equipment or machinery leased or
                  acquired by the Borrower or any of its Subsidiaries pursuant
                  to which the Indebtedness incurred in connection therewith is
                  held by the original manufacturer of such equipment or
                  machinery, or an Affiliate of said original manufacturer that,
                  in the ordinary course of its business, provides such
                  financing to purchasers of such equipment or machinery.

                  Payment Date. The term "Payment Date" means (i) in the case of
                  a LIBOR Loan, the last day of each Interest Period applicable
                  thereto; provided, however that, if the Interest Period
                  applicable to any such LIBOR Loan is in excess of 3 months,
                  then the Payment Date with respect to such Loan shall also
                  include the date that is 3 months after the initial funding
                  thereof, (ii) in the case of a Alternate Base Rate Loan, the
                  first day of each month occurring after the Closing Date, and
                  (iii) in the case of an Equipment Loan, the date that
                  corresponds numerically in the next calendar month following
                  the funding of such Loan to the date of such funding, and the
                  same date of each successive month occurring thereafter,
                  unless such funding date is the last day of a calendar month,
                  in which case, such Payment Date shall be the last day of each
                  such successive calendar month.

                  Permitted Investments. The term "Permitted Investments" means
                  (i) readily marketable direct obligations of the Government of
                  the United States of America or any agency or instrumentality
                  thereof or any full faith and credit obligations of the United
                  States Government or obligations guaranteed by the United
                  States Government and its agencies, (ii) any investment grade
                  debt or equity securities issued by any other Person, (iii)
                  certificates of deposit of any United States commercial bank,
                  (iv) any investment arranged by the Bank, or an affiliate of
                  the Bank, on behalf of the Borrower pursuant to cash
                  management services provided to the Borrower by the Bank or
                  such affiliate, (v) instruments


                                      -21-


<PAGE>

                  held for collection in the ordinary course of business, (vi)
                  any equity or debt securities or other form of debt instrument
                  obtained in settlement of debts previously contracted, and
                  (vii) any equity or debt security obtained in connection with
                  an acquisition permitted pursuant to Section 8.03 hereof.

                  Permitted Liens. The term "Permitted Liens" means those Liens
                  permitted to exist pursuant to Section 8.02 hereof.

                  Person. The term "Person" means any individual, partnership,
                  joint venture, firm, corporation, association, trust or other
                  enterprise or any government or political subdivision or any
                  agency, department or instrumentality thereof.

                  Public Offering. The term "Public Offering" means that certain
                  initial public offering of no less than 3,850,000 shares of
                  the common stock, no par value, of the Borrower, as
                  contemplated in that certain Registration Statement of the
                  Borrower on Form S-1 (Registration No. 333-23519) on file with
                  the SEC, together with Amendment No. 1 through 5 thereto, as
                  the same has been declared effective by the SEC on July 29,
                  1997 and the 424(b) prospectus filed on July 30, 1997 with the
                  SEC.

                  Revolving Credit Commitment Period. The term "Revolving Credit
                  Commitment Period" mean the period commencing on the Closing
                  Date and ending on the Revolving Credit Expiration Date.

                  Revolving Credit Expiration Date. The term "Revolving Credit
                  Expiration Date" means the earlier to occur of (a) August 12,
                  2000, as the same may be extended from time to time in the
                  sole and absolute discretion of the Bank or (b) the date on
                  which this Agreement is terminated pursuant to Section 3.03
                  hereof.

                  Revolving Credit Facility. The term "Revolving Credit
                  Facility" shall have the meaning assigned to such term in
                  Section 1.07 hereof.

                  Revolving Credit Loan and Revolving Credit Loans. The terms
                  "Revolving Credit Loan" and "Revolving Credit Loans" shall
                  have the meanings assigned to such term in Section 1.07
                  hereof.



                                      -22-

<PAGE>

                  Revolving Credit Note. The term "Revolving Credit Note" shall
                  have the meanings assigned to such term in Section 1.07
                  hereof.

                  SEC. The term "SEC" shall mean the Securities and Exchange
                  Commission or any Governmental Authority which may succeed to
                  the authority thereof or be substituted therefor.

                  Security Agreements. The term "Security Agreements" means
                  collectively each of the security agreements in favor of the
                  Bank executed and delivered in connection with the funding of
                  any Equipment Loan.

                  Stated Amount. The term "Stated Amount" means with respect to
                  any Letter of Credit, the maximum amount available to be drawn
                  thereunder, determined without regard to whether any
                  conditions to drawing could then be met.

                  Subsidiary. The term "Subsidiary" means, as to any Person, any
                  corporation or other entity of which securities or other
                  ownership interests having ordinary voting power to elect a
                  majority of the board of directors or other persons performing
                  similar functions are at the time directly or indirectly owned
                  or controlled by such Person, one or more of the other
                  Subsidiaries of such Person or any combination thereof.

                  Term Loan. The term "Term Loan" shall have the meaning
                  assigned to such term in Section 1.04 hereof.

                  Term Loan Maturity Date. The term "Term Loan Maturity Date"
                  shall have the meaning assigned to such term in Section 1.04
                  hereof.

                  Test Period shall mean, with respect to any applicable
                  determination under this Agreement, a period of twelve (12)
                  consecutive months (taken as one accounting period) and ending
                  on the last day of the fiscal quarter of the Borrower then
                  last ended, provided that during the period immediately
                  following the consummation of the Public Offering, this term
                  shall mean the shorter period commencing on such consummation
                  date and ending on the last day of the latest fiscal quarter
                  until there has elapsed 4 complete fiscal quarters; provided,
                  further that for purposes of any computation hereunder during
                  the period contemplated in the foregoing proviso, such
                  computation shall be annualized by the Bank in

                                      -23-


<PAGE>

                  accordance with methodologies customarily utilized by the Bank
                  for such purposes.

         2.02     Principles of Construction.

                  (a) References. All references to articles, Sections,
                  schedules and exhibits are to articles, Sections, schedules
                  and exhibits in or to this Agreement unless otherwise
                  specified. The words "hereof", "herein", and "hereunder" and
                  words of similar import when used in this Agreement shall
                  refer to this Agreement as a whole and not to any particular
                  provision of this Agreement.

                  (b) Accounting Terms. All accounting terms not specifically
                  defined herein or in any exhibit hereto shall be construed in
                  accordance with GAAP in conformity with those principles used
                  in the preparation of the financial statements referred to in
                  Section 6.04 hereof.

                                III. PREPAYMENT.
                                     -----------

         3.01     Prepayment of Revolving Credit Loans. The Revolving Credit
                  Loans may be prepaid, in whole or in part, at any time,
                  provided that any prepayment in respect of a LIBOR Loan shall
                  be made only on the last day of the Interest Period applicable
                  thereto, and provided, further, that any partial prepayments
                  of the Revolving Credit Loans shall be in a principal amount
                  of not less than $250,000, or any whole multiple thereof. All
                  prepayments shall include accrued and unpaid interest to the
                  date of prepayment on the principal amount prepaid. All
                  partial prepayments received pursuant to this Section 3.01
                  shall be applied to the Obligations that are in respect of the
                  Revolving Credit Loans in the manner determined by the Bank in
                  its reasonable discretion.

         3.02     Prepayments of Equipment Loans. Any Equipment Loan may be
                  prepaid, in whole or in part at any time, without premium or
                  penalty; provided, that any partial prepayment of an Equipment
                  Loan shall be in a principal amount of not less than $250,000,
                  or any whole multiple thereof. All prepayments of an Equipment
                  Loan shall include accrued and unpaid interest to the date of
                  prepayment on the principal amount prepaid. All partial
                  prepayments of the principal balance of any Equipment Loan
                  shall be applied to the Equipment Loan specified by the
                  Borrower in inverse order of maturity of such Equipment Loan.


                                      -24-
<PAGE>

         3.03     Termination. If the Borrower has prepaid the Revolving Credit
                  Loans and all Equipment Loans in full and has paid or
                  otherwise discharged all other Obligations, then upon written
                  notice to the Bank, the Borrower may irrevocably terminate
                  this Agreement without premium or penalty, whereupon no
                  further Loans will be made hereunder, such termination to be
                  effective as of the date set forth in said notice.

                        IV. YIELD MAINTENANCE PROVISIONS.
                            ----------------------------- 

         4.01     Inability to Determine Rate. If with respect to any Interest
                  Period, the Bank determines that extraordinary and unforeseen
                  circumstances beyond the control of the Bank exists with
                  respect to the relevant market which make it impracticable to
                  ascertain the interest rate applicable for such Interest
                  Period, the Bank shall promptly notify the Borrower of such
                  determination. Upon such determination, no additional LIBOR
                  Loans shall be permitted under the Revolving Credit Facility
                  and no conversions to, or continuances of, LIBOR Loans shall
                  be permitted pursuant to Section 1.12 hereof until the notice
                  of such determination has been withdrawn. If such notice has
                  not been withdrawn by the last day of the then current
                  Interest Period applicable to any then outstanding LIBOR
                  Loans, the Borrower must elect on the last day of such
                  Interest Period to either convert such LIBOR Loan to an
                  Alternate Base Rate Loan or prepay the outstanding principal
                  balance thereof and accrued interest thereon in full.

         4.02     Illegality. Notwithstanding any other provisions herein, if
                  any law, regulation, treaty or directive or any change therein
                  or in the interpretation or application thereof, shall make it
                  unlawful for the Bank to make or maintain any of the Loans as
                  LIBOR Loans as contemplated by this Agreement, (i) the Bank's
                  commitment hereunder to make LIBOR Loans under the Revolving
                  Credit Facility or to permit conversions to, or continuances
                  of, LIBOR Loans pursuant to Section 1.12 hereof shall
                  forthwith be suspended until the circumstances surrounding
                  such unlawfulness shall no longer exit and (ii) any of the
                  then outstanding LIBOR Loans shall be converted to a Alternate
                  Base Rate Loan on the last day of the Interest Period
                  applicable thereto or within such earlier period as may be
                  required by law.

         4.03     Requirement of Law. In the event that any law, regulation,
                  treaty or directive or any change therein or in the
                  interpretation or application thereof or


                                      -25-

<PAGE>

                  compliance by the Bank with any request or directive (whether
                  or not having the force of law) from any central bank or other
                  Governmental Authority (a "Requirement of Law"):

                  (a) does or shall subject the Bank to any tax of any kind
                  whatsoever with respect to this Agreement, the Notes or any
                  loan made hereunder, or change the basis of taxation of
                  payments to the Bank of principal, commitment fee, interest or
                  any other amount payable hereunder (except for changes in the
                  rate of any tax presently imposed on the Bank);

                  (b) does or shall impose, modify or hold applicable any
                  reserve, special deposit, compulsory loan or similar
                  requirement against assets held by, or deposits or other
                  liabilities in or for the account of, advances or loans by, or
                  other credit extended by, or any other acquisition of funds
                  by, any office of the Bank which are not otherwise included in
                  the determination of LIBOR hereunder; or

                  (c) does or shall impose on the Bank any other condition;

                  and the result of any of the foregoing is to increase the cost
                  to the Bank of making, renewing or maintaining advances or
                  extensions of credit to the Borrower or to reduce any amount
                  receivable from the Borrower hereunder then, in any such case,
                  the Borrower shall promptly pay to the Bank, upon its demand,
                  any additional amounts necessary to compensate the Bank for
                  such additional cost or reduced amount receivable which the
                  Bank deems to be material as determined by the Bank with
                  respect to this Agreement, the Notes or the Loans made
                  hereunder. If the Bank becomes entitled to claim any
                  additional amounts pursuant to this Section 4.03, it shall
                  promptly notify the Borrower of the event by reason of which
                  it has become so entitled. A certificate setting forth
                  calculations as to any additional amounts payable pursuant to
                  the foregoing sentence submitted by the Bank to the Borrower
                  shall be conclusive in the absence of manifest error. The
                  foregoing shall in no way be construed to permit the Bank to
                  seek compensation or payment of additional amounts pursuant to
                  this Section 4.03 in connection with any Requirements of Law
                  imposed upon the Bank as a result of the Bank's violation of a
                  Requirement of Law.

         4.04     Capital Adequacy. If after the date hereof, the Bank shall
                  have determined that the adoption of any 



                                      -26-

<PAGE>

                  applicable law, rule or regulation regarding capital adequacy
                  which is generally applicable to banks subject to the
                  jurisdiction of Governmental Authorities having jurisdiction
                  over the Bank, 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 the
                  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 the Bank's
                  capital as a consequence of its obligations hereunder to a
                  level below that which the Bank could have achieved but for
                  such adoption, change or compliance (taking into consideration
                  the Bank's policies with respect to capital adequacy) by an
                  amount deemed by the Bank to be material, then from time to
                  time, within 30 days after demand by the Bank, the Borrower
                  shall pay to the Bank such additional amount or amounts as
                  will compensate the Bank for such reduction. The Bank will
                  promptly notify the Borrower of any event of which it has
                  knowledge, occurring after the date hereof, which will entitle
                  the Bank to compensation pursuant to this Section 4.04, and
                  such notification of the amount due pursuant to this Section
                  4.04 shall be conclusive absent manifest error.

         4.05     Funding Indemnity. The Borrower agrees to indemnify the Bank
                  and to hold the Bank harmless from any loss or expense which
                  the Bank may sustain or incur as a consequence of (i) default
                  by the Borrower in payment of the principal of or interest on
                  any LIBOR Loan, including, but not limited to, any such loss
                  or reasonable expense arising from additional interest or fees
                  payable by the Bank to lenders of funds obtained by it in
                  order to maintain any Loan as a LIBOR Loan, (ii) except for
                  prepayments required pursuant to Section 4.01 or 4.02, any
                  prepayment of any LIBOR Loan received (from any source) on any
                  date other than the last day of the Interest Period applicable
                  thereto, including, but not limited to, any such loss or
                  expense in connection with the employing of deposits as a
                  consequence thereof, (iii) default by the Borrower in making
                  any borrowing of a LIBOR Loan under the Revolving Credit
                  Facility after such Borrower has given notice thereof in
                  accordance with Section 1.12 hereof, of a LIBOR Loan or (iv)
                  default by the Borrower in making any prepayment after the
                  Borrower has given a notice thereof. This covenant shall
                  survive termination of this Agreement and payment of the
                  Notes.



                                      -27-

<PAGE>

         4.06     Match Funding. The amount payable or indemnifiable under
                  Sections 4.03, 4.04 and 4.05 hereof shall be determined, in
                  the Bank's sole discretion, based upon the assumption that the
                  Bank funded 100% of any affected LIBOR Loan in the applicable
                  London interbank market.


                                 V. CONDITIONS.
                                    -----------

         5.01     Requirements for Initial Funding. The obligation of the Bank
                  to make the initial advance of any Loan available hereunder is
                  subject to the Bank's receipt of each of the documents listed
                  on the Closing Checklist attached hereto as Exhibit E, and
                  such other documents as the Bank may reasonably request, each,
                  as appropriate, duly executed and delivered by the parties
                  thereto and in form and substance satisfactory to the Bank.
                  The obligation of the Bank to make the initial advance of any
                  Loan available hereunder is subject to the further condition
                  that the Borrower shall have consummated the Public Offering
                  and the "Acquisitions" (as defined in the registration
                  statement, as amended, referred to in the definition of Public
                  Offering) and gross proceeds of not less than $42,000,000
                  shall have been received by the Borrower in connection
                  therewith and used for the purposes described in said
                  registration statement.

         5.02     Requirements for Any Advance or Conversion. The obligation of
                  the Bank to (i) make any advance under the Revolving Credit
                  Facility or the Equipment Facility, or (ii) permit the
                  conversion of any Revolving Credit Loan to a LIBOR Loan
                  pursuant to Section 1.12 hereof, is subject to and conditioned
                  upon the following:

                  (a)      the representations and warranties contained in
                           Article VI hereof are correct in all material
                           respects on and as of the date of each such advance,
                           conversion or continuation, except for
                           representations and warranties specifically stated to
                           relate to an earlier date, in which event such
                           representations and warranties shall be correct in
                           all material respects as of such earlier date;

                  (b)      no Event of Default, and no event which, with the
                           giving of notice, or the passage of time, or both,
                           would become an Event of Default, has occurred and is
                           continuing; and

                  (c)      all of the Credit Documents then in effect by their
                           terms remain in full force and effect.


                                      -28-
<PAGE>

         5.03     Additional Requirements for Advances Under Equipment Facility.
                  The obligation of the Bank to make any advance under the
                  Equipment Facility is subject to and conditioned upon, in
                  addition to satisfaction of the conditions specified in
                  Section 5.02, the satisfaction of the following conditions:

                  (a)      the Borrower shall have complied with the procedures
                           set forth in Section 1.03, including, without
                           limitation, the furnishing of all information
                           required thereunder;

                  (b)      the Borrower or the relevant Subsidiary Guarantor, as
                           the case may be, shall have furnished to the Bank
                           executed originals of (i) a Security Agreement
                           substantially in the form of Exhibit G attached
                           hereto (with such modifications thereto as may be
                           required by the law of the jurisdiction governing the
                           creation and perfection of the Bank's security
                           interest in the relevant Financed Equipment in order
                           to provide the Bank with all the right, benefits and
                           remedies of a secured creditor with a first priority
                           lien in such equipment) and (ii) such UCC-1 financing
                           statements (state and/or local), in each case as may
                           be reasonably requested by the Bank;

                  (c)      the Borrower or the relevant Subsidiary Guarantor, as
                           the case may be, shall have caused to be delivered to
                           the Bank a landlord consent and waiver, in
                           substantially the form of Exhibit G hereto, from each
                           landlord of the premises in which the relevant
                           Financial Equipment is to be located;

                  (d)      the Borrower or the relevant Subsidiary Guarantor as
                           the case may be, shall have authorized the Bank to
                           fund the proceeds of the relevant Equipment Loan
                           directly to the vendor of the relevant Financed
                           Equipment and, in that connection, the Borrower or
                           such Subsidiary Guarantor shall have furnished to the
                           Bank all such information and payment instructions as
                           the Bank may request to effect such funding;

                  (e)      the Borrower or the relevant Subsidiary Guarantor,
                           shall have taken all such additional steps and/or, as
                           the case may be, provided the Bank with all such
                           other further assurances as the Bank may reasonably
                           request to assure the Bank that the Lien of the

                                      -29-

<PAGE>

                           Bank in the relevant Financed Equipment is of the
                           first priority, subject to no other Liens; and

                  (f)      the Borrower shall have caused to be delivered to the
                           Bank an Equipment Loan Note substantially in the form
                           of Exhibit A hereto, appropriately completed by the
                           Bank to reflect the specific terms of the applicable
                           Equipment Loan in accordance with the terms of this
                           Agreement.

                       VI. REPRESENTATIONS AND WARRANTIES.
                           -------------------------------

         The Borrower represents and warrants that:

         6.01     Organization; Authority. The Borrower (a) is a corporation
                  duly organized, validly existing and in good standing under
                  the laws of the State of New Jersey, is duly qualified as a
                  foreign corporation and is in good standing under the laws of
                  each jurisdiction in which it is required to be qualified
                  because of the business it conducts or the property it owns,
                  and (b) has the necessary power and authority to enter into
                  and perform its obligations under the Credit Documents and all
                  other documents required by the Bank in connection therewith.
                  The execution and performance of the Credit Documents have
                  been duly authorized by all necessary proceedings on the part
                  of the Borrower, and, upon their execution and delivery, they
                  will be valid, binding, and enforceable in accordance with
                  their terms. The execution and performance of the Credit
                  Documents by the Borrower will not violate any orders, laws or
                  regulations applicable to it, any of its organizational
                  documents, or any instruments, indentures or agreements
                  (including any provisions pertaining to subordinated debt) to
                  which the Borrower is a party or by which the Borrower or any
                  of its properties are bound, except to the extent that any
                  such violation would not have a Material Adverse Effect. All
                  consents, approvals, licenses, franchises, trademarks and
                  other general intangibles that are necessary or appropriate in
                  connection with this Agreement, the other Credit Documents or
                  the operation of the business of the Borrower have been
                  obtained and are in full force and effect, except to the
                  extent that any such failure to so obtain and maintain such
                  general intangibles would not have a Material Adverse Effect.

         6.02     Subsidiaries. The corporations listed on Annex I are the only
                  Subsidiaries of Borrower as of the date hereof and each such
                  Subsidiary is a corporation, duly organized, valid existing
                  and in good standing, under

    
                                      -30-
<PAGE>

                  the law of the jurisdiction of its organization, is duly
                  qualified as a foreign corporation and is in good standing
                  under the law of each jurisdiction in which it is required to
                  be qualified because of the business it conducts or the
                  property it owns and have all necessary power and authority to
                  own its property and conduct its business as then conducted.
                  All consents, approvals, licenses, franchises, trademarks and
                  other general intangibles that are necessary or appropriate in
                  connection with the operation of the business of each
                  Subsidiary, have been obtained and are in full force and
                  effect, except to the extent that any such failure to so
                  obtain and maintain such general intangibles would not have a
                  Material Adverse Effect. Each such Subsidiary is a wholly
                  owned Subsidiary of the Borrower and no other Person has any
                  direct or indirect interest in such Subsidiary, other than
                  such interests which may exist as a result of any stock
                  ownership interest of any Person in the Borrower.

         6.03     Use of Proceeds; Margin Regulation. The proceeds of the
                  Equipment Loans shall be used exclusively for purchase money
                  financing of Financed Equipment. The proceeds of borrowings
                  under the Revolving Credit Facility shall be used by the
                  Borrower for the following purposes: (i) to fund acquisitions
                  permitted pursuant to Section 8.03 hereof, (ii) to refinance
                  certain existing Indebtedness of the Borrower and certain of
                  its Subsidiaries as and to the extent disclosed in writing to
                  the Bank prior to the Closing Date, and (iii) working capital
                  and other general corporate purposes. The Borrower (nor any of
                  its Subsidiaries) is not engaged in the business of extending
                  credit for the purpose of buying or carrying "margin stock"
                  (within the meaning of Regulation U issued by the Board of
                  Governors of the Federal Reserve System). Neither the making
                  of any Loan nor use of the proceeds thereof will violate or be
                  inconsistent with the provisions of Regulation G, T, U or X of
                  the Board of Governors of the Federal Reserve System.

         6.04     Financial Statements. The financial statements included in the
                  Borrower's Form S-1 (as amended) as filed with the SEC in
                  connection with the Public Offering, were prepared in
                  accordance with GAAP, consistently applied, are true and
                  correct, and disclose all presently outstanding indebtedness
                  or obligations of the Borrower as of the date thereof to the
                  extent required under GAAP, including contingent obligations,
                  obligations under leases of property from others, and all
                  liens and encumbrances, including tax liens, against its
                  properties and assets; and there have been no material 

                                      -31-

<PAGE>

                  adverse changes in the Borrower's financial condition or
                  business since the date of such statements through the Closing
                  Date.

         6.05     Suits. Other than as disclosed on Annex I hereof, there are no
                  actions, suits, proceedings, or claims pending or threatened
                  against the Borrower, any of its Subsidiaries, or any of their
                  respective properties, which, if adversely determined, would
                  have a Material Adverse Effect.

         6.06     Burdensome Agreements. Neither the Borrower nor any of its
                  Subsidiaries is a party to any indenture, loan or credit
                  agreement or any other agreement, contract or instrument, or
                  subject to any certificate of incorporation, by-law, or
                  corporate restriction, the compliance with, or the performance
                  of, which may reasonably be expected to have a Material
                  Adverse Effect.

         6.07     Defaults. Neither the Borrower nor any of its Subsidiaries are
                  in default under any agreement to which it is a party or by
                  which it is or any of its properties are bound, or under any
                  indenture or instrument evidencing any its indebtedness and
                  neither the execution of nor performance by the Borrower under
                  the Credit Documents will create a default or any lien or
                  encumbrance under any such agreement, indenture or instrument
                  other than a lien or encumbrance in favor of the Bank, except,
                  in each case, to the extent that the occurrence of any such
                  defaults or the existence of any such liens would not have a
                  Material Adverse Effect.

         6.08     ERISA. No employee benefit plan established or maintained by
                  the Borrower which is subject to the Employee Retirement
                  Income Security Act, 29 U.S.C. ss. 1001 et seq. ("ERISA") has
                  an accumulated funding deficiency (as such term is defined in
                  ERISA). No material liability to the Pension Benefit Guaranty
                  Corporation (or any successor thereto under ERISA) has been
                  incurred by the Borrower or any of its Subsidiaries with
                  respect to any such plan and no Reportable Event under ERISA
                  has occurred. Neither the Borrower nor any of its Subsidiaries
                  has an actual or anticipated liability under Section 4971 of
                  the Internal Revenue Code ("Code") (relating to tax on failure
                  to meet the minimum funding standard of Section 412 of the
                  Code) with respect to any employee benefit plan to which any
                  of them contributes but which is not maintained or established
                  by any of them. No proceedings have been 

                                      -32-

<PAGE>


                  instituted to terminate any employee benefit plan of the type
                  described in this Section 6.08 and no condition exists which
                  presents a material risk, to the Borrower or any of its
                  Subsidiaries of incurring liabilities to or on account of any
                  such plan pursuant to the provisions of ERISA or the
                  applicable provisions of the Code.

         6.09     Tax Returns and Taxes. Each of the Borrower and its
                  Subsidiaries has filed all federal, state and local tax
                  returns required to be filed and has paid all taxes,
                  assessments and governmental charges and levies thereon,
                  including interest and penalties, except where the same are
                  being contested in good faith by appropriate proceedings and
                  for which adequate reserves have been set aside, and no liens
                  for taxes have been filed by a Governmental Authority with
                  respect to any taxes. The charges, accruals and reserves on
                  the books of the Borrower or its Subsidiary, as the case may
                  be, with respect to taxes or other governmental charges are
                  adequate.

         6.10     Compliance with Statutes, etc. Each of the Borrower and its
                  Subsidiary is in compliance with all applicable statutes,
                  regulations and orders of, and all applicable restrictions
                  imposed by, any Government Authority, in respect of the
                  conduct of its business and the ownership of its property
                  (including, without limitation, any applicable Environmental
                  Laws), except such instances of noncompliances as would not
                  have a Material Adverse Effect.

         6.11     Not an Investment Company. Neither the Borrower nor any of its
                  Subsidiaries is an "investment company" or a company
                  "controlled" by an "investment company", within the meaning of
                  the Investment Company Act of 1940, as amended.

         6.12     No Authorizations or Approvals. No authorization or approval
                  or action by, and no notice to or filing with, any
                  Governmental Authority is required for the due execution,
                  delivery and performance by the Borrower of this Agreement and
                  the other Credit Documents.

         6.13     Intellectual Property, etc. Each of the Borrower and its
                  Subsidiaries has obtained all material patents, trademarks,
                  servicemarks, trade names, copyrights, technology, processes,
                  licenses and other rights ("Intellectual Property"), free from
                  any burdensome restrictions, that are necessary for the
                  operation of 


                                      -33-

<PAGE>

                  their respective businesses as presently conducted and as
                  proposed to be conducted. No material claim has been asserted
                  or threatened questioning the use of such Intellectual
                  Property, nor does the Borrower or any of its Subsidiaries
                  know of any valid basis for any such material claim.

         6.14     Assets and Properties. Each of the Borrower and its
                  Subsidiaries has good (and, with respect to real property,
                  marketable) title to all of its assets and properties
                  (tangible and intangible) and all such assets and properties
                  are free and clear of all Liens (except Permitted Liens).
                  Substantially all of the assets and properties owned by,
                  leased to or used by each of the Borrower and its Subsidiaries
                  are in adequate operating condition and repair, ordinary wear
                  and tear excepted, are free and clear of known defects except
                  such defects as do not substantially increase with the
                  continued use thereof in the conduct of normal operation, and
                  such assets are able to serve the function for which they are
                  currently being used, except in each case, where the failure
                  of such asset or property to meet such requirements would not
                  have a Material Adverse Effect.

         6.15     Labor Matters. Except as disclosed on Annex I, neither the
                  Borrower nor any of its Subsidiaries is a party to a
                  collective bargaining or union contract. There are no strikes,
                  lockouts or other disputes relating to any collective
                  bargaining or similar agreement to which the Borrower of any
                  of its Subsidiaries is a party.

         6.16     Insurance. Annex I hereto lists all material insurance
                  contracts and binders of the Borrower and its Subsidiaries
                  which are in full force and effect on the date hereof. Such
                  contracts and binders provide coverages which are usual and
                  customary in the business of the Borrower and its Subsidiaries
                  as to amount and scope. With respect to coverages pertaining
                  to any Financed Equipment, each such insurance contract and
                  binder shall contain standard lender's endorsement and loss
                  payee endorsements in favor of the Bank, and subject to
                  cancellation or reduction in coverage only upon 30 days' prior
                  written notice thereto to the Bank.

         6.17     True and Complete Disclosure. All factual information (taken
                  as a whole) heretofore or contemporaneously furnished by the
                  Borrower to the Bank for the purposes of or in connection with
                  this Agreement or any transactions contemplated herein is, and
                  all other such factual information (taken as a whole)
                  hereafter furnished by or on behalf of the Borrower in writing
                   


                                      -34-


<PAGE>


                  to the Bank will be, true and accurate in all material
                  respects on the date as of which such information is dated or
                  certified and does not omit to state any fact necessary to
                  make such information (taken as a whole) not misleading at
                  such time in light of the circumstances under which such
                  information was provided.

                           VII. AFFIRMATIVE COVENANTS.
                                ----------------------

         The Borrower covenants and agrees that for so long as there are any
outstanding Obligations hereunder, or the Bank shall have any obligation
hereunder, the Borrower shall (and, as applicable, shall cause each of its
Subsidiaries (including the Guarantors) to):

         7.01     Financial Statements. Furnish to the Bank the following
                  financial information: (i) as soon as available but in any
                  event within 90 days (or 105 days, if the Borrower is
                  operating under an automatic extension afforded pursuant to
                  the rules and regulations promulgated by the SEC) after the
                  close of each fiscal year of the Borrower, to the extent
                  prepared to comply with SEC requirements, a copy of the SEC
                  Form 10-K (or successor form promulgated by the SEC) filed by
                  the Borrower with the SEC for such fiscal year, or, if no such
                  form was so filed for such fiscal year, Consolidated audited
                  year-end financial statements for the Borrower, including, but
                  not limited to, statements of financial condition, income and
                  cash flows, a reconciliation of net worth, notes and other
                  supporting schedules to such financial statements and any
                  other information reasonably requested by the Bank that may
                  assist the Bank in assessing the Borrower's financial
                  condition (prepared in accordance with GAAP consistently
                  applied, and accompanied by an opinion, satisfactory in
                  substance to the Bank, by an independent certified public
                  accountant acceptable to the Bank, and certified as true,
                  correct and complete by the Borrower's chief financial
                  officer); (ii) as soon as available but in any event within 45
                  days (or 50 days, if the Borrower is operating under an
                  automatic extension afforded pursuant to the rules and
                  regulations promulgated by the SEC) after each interim fiscal
                  quarter, to the extent prepared to comply with SEC
                  requirements, a copy of the SEC Form 10-Q (or successor form
                  promulgated by the SEC) filed by the Borrower with the SEC for
                  such fiscal quarter; or, if no such form was so filed for such
                  fiscal quarter, unaudited management prepared consolidated
                  financial statements for the Borrower for such quarter,
                  including, but not limited to, statements of financial
                  condition, incoming cash flows, a reconciliation of net worth,


                                      -35-

<PAGE>

                  and supporting schedules (prepared in accordance with GAAP
                  consistently applied, and certified as true, correct and
                  complete by the Borrower's chief financial officer); (iii)
                  promptly upon filing the same with the SEC, copies of any
                  filings and registrations with, and any reports to, the SEC by
                  the Borrower, including, but not limited to, any reports on
                  Form 8-K (or successor term promulgated by the SEC), or any
                  proxy or registration statement or any other form of public
                  disclosure prescribed by the SEC; and (iv) such other
                  information respecting the operations, financial or otherwise,
                  of the Borrower as the Bank may from time to time reasonably
                  request.

         7.02     Compliance Certificate. Furnish to the Bank, together with
                  each set of financial statements described in clauses (i) and
                  (ii) of Section 7.01 hereof, a compliance certificate,
                  substantially in the form of Exhibit F hereto, signed by the
                  Borrower's chief financial officer, certifying that: (i) all
                  representations and warranties set forth in this Agreement and
                  in the other Credit Documents are true and correct in all
                  material respects as of the date thereof, except for
                  representations and warranties specifically stated to relate
                  to an earlier date in which event such representations and
                  warranties shall be correct in all material respects as of
                  such earlier date; (ii) none of the covenants in this
                  Agreement or in the other Credit Document have been breached
                  which breach is continuing; and (iii) no event has occurred
                  which, alone, or with the giving of notice or the passage of
                  time, or both, would constitute an Event of Default under this
                  Agreement or the other Credit Documents.

         7.03     Notice of Certain Events. Promptly give written notice to the
                  Bank of: (i) the details of any Reportable Events (as defined
                  in ERISA) which have occurred, (ii) the occurrence of any
                  event which alone or with notice, the passage of time, or
                  both, would constitute an Event of Default, and (iii) the
                  commencement of any proceeding or litigation which, if
                  adversely determined, would have a Material Adverse Effect.

         7.04     Preservation of Property; Insurance. Keep and maintain, and
                  require each of its Subsidiaries to keep and maintain, all of
                  its and their material properties and assets in good order and
                  repair, ordinary wear and tear excepted; maintain in all
                  material respects all insurance coverages described in Section
                  6.16 hereof and such other extended coverage, general
                  liability, hazard, business interruption, property and other
                  insurance in 


                                      -36-

<PAGE>


                  amounts reasonably satisfactory to the Bank and as is
                  customary for businesses similar to such corporation's
                  business and deliver to the Bank certificates of all such
                  insurance in effect; and cause all such policies covering any
                  of the Financed Equipment to contain loss payee endorsements
                  in favor of the Bank and to be subject to cancellation or
                  reduction in coverage only upon 30 days prior written notice
                  thereof to the Bank at its address set forth in this
                  Agreement. The foregoing insurance requirements are in
                  addition to any insurance requirements set forth in the
                  Security Agreements.

         7.05     Taxes. Pay and discharge, and require each of the its
                  Subsidiaries to pay and discharge, when due, all taxes,
                  assessments or other governmental charges imposed on them or
                  any of their respective properties, unless the same are
                  currently being contested in good faith by appropriate
                  proceedings and adequate reserves are maintained therefor.

         7.06     Conduct of Business and Maintenance of Existence. Continue to
                  engage in business of the same general type as now conducted,
                  and preserve, renew and keep in full force and effect its
                  corporate existence and rights, privileges and franchises
                  necessary in the normal conduct of business and which are
                  material to the Borrower and its Subsidiaries, taken as a
                  whole. For the avoidance of doubt, it is hereby acknowledged
                  that the foregoing shall not be construed to prohibit the
                  corporate transactions permitted to occur under Section
                  8.03(A) hereof.

         7.07     Operation of Business and Properties. Operate its business and
                  properties, and cause those of its Subsidiaries to be
                  operated, in compliance with all applicable orders, rules,
                  regulations and other requirements of any Governmental
                  Authority applicable thereto, and duly file or cause to be
                  filed such reports and/or information returns as may be
                  required or appropriate under applicable orders, rules,
                  regulations or other requirements of any Governmental
                  Authority, including, without limitation, any Environmental
                  Laws, except to the extent that such non-compliance would not
                  have a Material Adverse Effect.

         7.08     Access to Properties, Books and Records. Keep adequate books
                  and records of accounts reflecting all of its financial
                  transactions and permit the Bank's representatives and/or
                  agents full and complete access to any or all of the
                  Borrower's properties and financial records, to make extracts
                  from and/or audit such records


                                      -37-
 
<PAGE>


                  and to examine and discuss their properties, business,
                  finances and affairs with the Borrower's officers and outside
                  accountants, provided that such access need only be provided
                  by the Borrower during normal business hours and on not less
                  than 72 hours' prior notice and the costs incurred in
                  connection with any such examination conducted prior to the
                  occurrence of an Event of Default shall be borne by the Bank.

         7.09     Environmental Liens. In the event that there shall be filed a
                  Lien against any property of the Borrower or any of its
                  Subsidiaries by any Governmental Authority arising from an act
                  or omission of the Borrower or any of its Subsidiaries,
                  resulting in the discharge of hazardous substances or wastes
                  into the atmosphere or waters or onto lands, then, within 60
                  days from the date that the Borrower or any of its
                  Subsidiaries is given notice that the Lien has been placed
                  against such property or within such shorter period of time in
                  the event that such Governmental Authority has commenced steps
                  to cause such property to be sold pursuant to the lien, either
                  (i) pay the claim and remove the Lien from the applicable
                  property or (ii) furnish to such Governmental Authority with
                  one of the following: (x) a bond satisfactory to Governmental
                  Authority in the amount of the claim out of which the Lien
                  arises, (y) a cash deposit in the amount of the claim out of
                  which the Lien arises, or (z) other security reasonably
                  satisfactory to such Governmental Authority in an amount
                  sufficient to discharge the claim out of which the Lien
                  arises.

         7.10     Removal of Hazardous Substances. Should the Borrower and any
                  of its Subsidiaries cause or permit any act or omission
                  resulting in the discharge of hazardous substances or wastes
                  into the atmosphere or waters, or onto the lands in violation
                  of any applicable Environmental Law, promptly clean up same in
                  accordance with all applicable Environmental Laws.

         7.11     Further Assurances. Do, execute, acknowledge and deliver or
                  cause to be done, executed, acknowledged and delivered, all
                  such further instruments, acts, deeds, and assurances as may
                  be reasonably requested by the Bank for the purpose of
                  carrying out the provisions and intent of the Credit
                  Documents.




                                      -38-
    
<PAGE>


                        VIII. NEGATIVE COVENANTS.
                              -------------------

         So long as any Obligations are outstanding, or the Bank shall have any
obligation hereunder, without the prior written consent of the Bank (which
consent shall not be unreasonably withheld), the Borrower shall not (and shall
not, as applicable, permit any of its Subsidiaries (including the Guarantor)
to):

         8.01     Incur Indebtedness. Incur, create, assume, or permit to exist
                  any Indebtedness at any time, except:

                  (a)    Indebtedness of the Borrower owing to the Bank under
                         this Agreement and the Notes;

                  (b)    other Indebtedness of the Borrower owing to the Bank;

                  (c)    Indebtedness existing on the date hereof that is
                         described on Annex I hereof;

                  (d)    Approved Subordinated Indebtedness;

                  (e)    Indebtedness in respect of normal trade debt arising
                         in the ordinary course of business;

                  (f)    Indebtedness secured by Liens permitted to exist
                         pursuant to Section 8.02(h); Notwithstanding the
                         foregoing provisions of this clause (f), before the
                         Borrower or any of its Subsidiaries incurs Indebtedness
                         for borrowed money under this clause (f) the Borrower
                         shall give the Bank written notice of the intention to
                         borrow, setting forth a description of the proposed
                         borrowing, and the Bank shall have 5 Business Days to
                         notify the Borrower that it elects to make the proposed
                         loan. If the Bank fails to make such election, then the
                         Borrower and its Subsidiaries shall be free to incur
                         the proposed Indebtedness on substantially as favorable
                         terms to the Borrower and its Subsidiaries, as
                         applicable, as proposed to the Bank free of the right
                         of the Bank to make such loan under this clause (f). If
                         the Bank elects to make the proposed loan, then the
                         Borrower and the Bank shall negotiate in good faith to
                         consummate the proposed loan within a reasonable time.
                         If such negotiations do not result in the closing of
                         the proposed loan, then the Borrower and its
                         Subsidiaries, as applicable, shall be entitled to
                         borrow on substantially as favorable terms to the
                         Borrower and its Subsidiaries, as applicable, as


                                      -39-

<PAGE>

                         proposed free of the right of the Bank to make the
                         proposed loan under this clause (f);

                  (g)    Indebtedness that constitutes Guaranteed Indebtedness
                         of the Borrower or any of its Subsidiaries that has
                         been incurred by the Borrower or any of its
                         Subsidiaries solely by virtue of an endorsement of
                         checks or drafts negotiated in the ordinary course of
                         the business;

                  (h)    Indebtedness incurred or assumed in connection with
                         acquisitions permitted pursuant to Section 8.03 hereof,
                         but only to the extent that such Indebtedness would
                         otherwise be permitted to exist pursuant to clauses
                         (d), (e), (f)(but without regard to the monetary
                         threshold set forth in clause (h) of Section 8.02
                         hereof), (g), (j) or (l) of this Section 8.01;

                  (i)    Indebtedness owing from or to Borrower or any of its
                         Subsidiaries to or from any other of its Subsidiaries
                         or Borrower;

                  (j)    Indebtedness arising under any OEM Equipment Finance
                         Transactions;

                  (k)    Indebtedness convertible into capital stock of the
                         Borrower, or warrants or other rights to acquire such
                         capital stock; or

                  (l)    Indebtedness incurred in connection with Facilities
                         Management Arrangements.



         8.02     Negative Pledge. Create, permit to exist, or suffer the
                  creation of, any Lien, on any of its properties or assets
                  (real or personal, tangible or intangible), except:

                  (a)    Liens in favor of the Bank;

                  (b)    Liens existing on the date hereof that are listed on
                         Annex I hereto;

                  (c)    Liens for taxes, assessments or governmental charges or
                         levies to the extent not required to be paid by Section
                         7.05 hereof;

                  (d)    Liens imposed by law, such as materialmen's,
                         mechanics', carrier's, workmen's, and repairmen's


                                      -40-

<PAGE>

                         Liens and other similar Liens arising in the ordinary
                         course of business securing obligations which are not
                         overdue for a period of more than 30 days;

                  (e)    pledges or deposits to secure obligations under
                         workmen's compensation laws or similar legislation or
                         to secure public or statutory obligations of the
                         Borrower or any of its Subsidiaries;

                  (f)    Liens with respect to any OEM Equipment Finance
                         Transaction but only in respect of the equipment
                         acquired therein;

                  (g)    Liens incurred, assumed or created in connection with
                         Facilities Management Arrangements, but only as to
                         equipment and machinery that (i) is pertinent to the
                         performance by the Borrower or the relevant Subsidiary
                         of its obligations thereunder and (ii) was not an asset
                         of the Borrower or such relevant Subsidiary prior to
                         such arrangement;

                  (h)    Liens for finance leases of equipment leased by the
                         Borrower or any of its Subsidiaries (including
                         Capitalized Leases), or purchase money Liens upon or in
                         equipment acquired or held by the Borrower or any of
                         its Subsidiaries in the ordinary course of business to
                         secure the purchase price of such equipment or to
                         secure Indebtedness incurred solely for the purpose of
                         financing the acquisition of any such equipment to be
                         subject to such Liens, or Liens existing on any such
                         equipment at the time of the leasing, acquisition, or
                         extensions, renewals or replacements of any of the
                         foregoing for the same or a lesser amount, provided
                         that no such Lien shall extend to or cover any
                         equipment (including, but not limited to, the Financed
                         Equipment) other than the equipment being leased or
                         acquired and no such extension, renewal or replacement
                         shall extend to or cover any equipment not theretofore
                         subject to the Lien being extended, renewed or
                         replaced, and provided, further, that (i) the aggregate
                         principal amount of the Indebtedness at any one time
                         outstanding secured by Liens permitted pursuant to this
                         clause (h) shall not exceed $5,000,000 at any one time
                         outstanding and (ii) any such Indebtedness shall not
                         otherwise be prohibited by the terms of this Agreement;
                         or

                  (i)    the replacement, extension or renewal of any Lien
                         permitted by clauses (a) through (h) above upon or 


                                      -41-

<PAGE>

                         in the same property theretofore subject thereto or the
                         replacement, extension or renewal (without increase of
                         principal amount) of the Indebtedness secured thereby.

         8.03     Sale of Assets; Liquidation; Merger; Acquisitions. (i) Convey,
                  lease, sell, transfer or assign any assets or properties
                  presently owned or hereafter acquired by it, except
                  dispositions of inventory in the ordinary course of business
                  for value received and such other dispositions of assets and
                  properties that are not material to the business or operations
                  of the Borrower or any of its Subsidiaries, if such asset or
                  property is replaced with reasonable promptness or is
                  otherwise obsolete or not needed, (ii) liquidate or
                  discontinue its normal operations with intent to liquidate;
                  (iii) enter into any merger or consolidation; (iv) acquire all
                  or substantially all of the assets, stock or other equity
                  interests of any other Person; or (v) take any action, or
                  enter into any agreements, to effect any of the foregoing.
                  Notwithstanding the foregoing or anything to the contrary set
                  forth in this Agreement, the following transactions shall be
                  permitted upon the satisfaction of the condition pertaining
                  thereto set forth below:

                  (A)    The consolidation, merger or liquidation of any
                         Subsidiary of the Borrower with or into the Borrower or
                         another Subsidiary of the Borrower, if and only if, the
                         Borrower or such other Subsidiary shall be the
                         surviving or resulting entity of any such proposed
                         transaction.

                  (B)    The acquisition by the Borrower of any other Person or
                         substantially all of the assets of such Person, if and
                         only if, the following conditions were fulfilled:

                         (i) said acquisition is of a Person or of a business or
                         product of such Person that is related or complimentary
                         to the business or products of the Borrower and its
                         Subsidiaries as presently conducted;

                         (ii) no later than 5 Business Days prior to the
                         consummation of any such proposed acquisition, the Bank
                         shall have received a true and correct copy of any and
                         all contractual undertakings related to the proposed
                         acquisition together (w) evidence of receipt of
                         approvals of Governmental Authorities to such
                         acquisition, if any such approvals are 


                                      -42-


<PAGE>


                         required, (x) with full and complete written
                         description of such proposed acquisition, (y) a pro
                         forma opening balance sheet and income statement of the
                         Borrower on a combined and combining basis giving
                         effect to such proposed acquisition, and (z) such
                         financial information and computations as the Bank may
                         deem necessary to demonstrate that, immediately after
                         giving effect to such proposed acquisition, none of the
                         covenants set forth in Sections 8.12 through 8.15
                         hereof shall be violated;

                         (iii) the Borrower or one of its Subsidiaries shall be
                         the surviving or resulting entity of any such proposed
                         acquisition, or the purchaser of any stock or assets
                         being acquired in such transaction;

                         (iv) the aggregate cash and non-cash consideration paid
                         or exchanged by the Borrower (including, without
                         limitation, any Indebtedness assumed by the Borrower,
                         and all amounts payable under or in respect of any
                         non-compete covenants or similar agreements shall not
                         exceed (x) $12,500,000 in any single acquisition and
                         (y) $30,000,000 in the aggregate for all such
                         acquisitions, in each cash in any period of 12
                         consecutive months. For the purposes of determining the
                         consideration paid or exchanged in any such
                         acquisition, the value attributed to any capital stock
                         of the Borrower given or exchanged shall not be
                         included therein; and

                         (v) immediately after giving effect to such proposed
                         acquisition and the incurrence or assumption of
                         Indebtedness, if any, in connection therewith, Sections
                         8.01, 8.02, 8,13, 8.14, 8.15, 8.16 and 8.17 hereof
                         shall not have been violated.

         8.04     Intentionally Omitted.

         8.05     Sale-Leaseback Transactions. Enter into any sale-leaseback
                  transaction or any transaction howsoever termed which would
                  have the same or substantially the same result or effect as a
                  sale-leaseback, except in connection with an acquisition
                  permitted under Section 8.03(B) hereof for the purpose of
                  effectively conveying or otherwise transferring real property
                  of the Person acquired in any such transaction, or to permit
                  such Person to effectively retain its interest in any real
                  property which is not being acquired in any such transaction.


                                      -43-

<PAGE>


         8.06     Prepayment of Other Indebtedness. Prepay any amounts on any
                  outstanding Indebtedness permitted to exist pursuant to
                  clauses (d) or (k) of Section 8.01 hereof, which is not
                  required to be prepaid by the express terms thereof, or cause
                  or permit the acceleration of any amounts on any outstanding
                  Indebtedness now existing or hereafter arising.

         8.07     Investments. Purchase or make any investment in the stock,
                  securities or evidences of indebtedness of, or make capital
                  contributions or loans or advances to, or other forms of
                  investments in, any Person ("Investments"), except Permitted
                  Investments. Notwithstanding the foregoing, the Borrowers
                  shall be permitted to make loans to its employees for
                  corporate purposes; provided that the aggregate principal
                  amount of such loans outstanding at any one time shall not
                  exceed $250,000.

         8.08     Create Subsidiaries. Create, permit to exist, or invest or
                  otherwise participate in any Subsidiaries (other than the
                  Subsidiaries listed on Annex I hereto) or any partnership or
                  other separate legal entity; provided that the foregoing shall
                  not apply to any new Subsidiaries that executes and delivers
                  in favor of the Bank a guaranty and suretyship agreement (as
                  well as resolutions authorizing the same), in each case
                  substantially the same as the guaranty executed and delivered
                  by the Guarantors in connection with the transactions herein
                  contemplated.

         8.09     Hazardous Substances. Cause or permit to exist a discharge of
                  hazardous substances or wastes into the atmosphere or waters
                  or onto lands unless such discharge is pursuant to and in
                  compliance with the conditions of a permit issued by the
                  appropriate Governmental Authorities or otherwise in
                  compliance with applicable Environmental Law or the discharge
                  does not have a Material Adverse Effect and is properly being
                  remedied by the Borrower or one of its Subsidiaries.

         8.10     Dividends, Etc. Declare or make any dividend payment or other
                  distribution of assets, properties, cash, rights, obligations
                  or securities on account of any shares of any class of stock
                  of the Borrower, or purchase, redeem, or otherwise acquire for
                  value (or permit any of its Subsidiaries to do so) any shares
                  of any class of stock of the Borrower or any warrants, rights
                  or options to acquire any such shares, now or



                                      -44-
 
<PAGE>



                  hereafter outstanding; except that the Borrower may declare
                  and pay quarterly cash dividends in respect of its common
                  stock; provided, however, that if immediately after giving
                  effect to any such proposed dividend payment, a violation of
                  any provision of Section 8.12 through 8.17 or any other Events
                  of Default would exist, then no such dividend payments shall
                  be permitted hereunder. The Borrower may from time to time
                  request that the Bank permit the payment of quarterly
                  dividends in addition to the amount set forth in this Section
                  8.10 by written notice to the Bank specifying the time and
                  amount of such additional dividends; provided, however, that
                  no such additional dividends shall be permitted hereunder
                  without the prior written consent of the Bank (which consent
                  may or may not be given in each Bank's sole and absolute
                  discretion) and any such consent shall be effective only in
                  the specific instance requested.

         8.11     Redemption of Common Stock. Enter into any agreement to, or
                  purchase or retire shares of the Borrower's common stock or
                  pay or make other similar payments in respect thereof.

         8.12     Consolidated Stated Net Worth. Permit as at the end of any
                  Test Period the sum of (A) the Consolidated Stated Net Worth
                  plus (B) if a positive number, the Borrower's net income for
                  the relevant Test Period (excluding any extraordinary items or
                  non-recurring items) to be less than 90% of said sum
                  determined as of the last day of the immediately preceding
                  Test Period, tested no less frequently than quarterly and
                  determined in each case on a Consolidated basis in accordance
                  with GAAP, consistently applied.

         8.13     Consolidated Tangible to Stated Net Worth. Permit at any time,
                  its Consolidated Tangible Net Worth to be any less than 25% of
                  the Consolidated Stated Net Worth, tested no less frequently
                  than quarterly and determined in accordance with GAAP,
                  consistently applied.

         8.14     Consolidated Funded Debt to EBITDA Ratio. Permit at any time
                  the Consolidated Funded Debt to EBITDA Ratio to exceed 3.25 to
                  1.00, tested no less frequently than quarterly for each Test
                  Period and determined in each case in accordance with GAAP,
                  consistently applied.

         8.15     Consolidated Fixed Charges Ratio. Permit at any time its
                  Consolidated Fixed Charges Ratio to exceed 1.50 to 1.00,
                  tested no less frequently than quarterly for each 


                                      -45-

<PAGE>

                  Test Period and determined in each case in accordance with
                  GAAP, consistently applied.

         8.16     Transactions with Affiliates. Except as expressly permitted by
                  this Agreement, directly or indirectly: (i) make any
                  Investment in an Affiliate; (ii) transfer, sell, lease, assign
                  or otherwise dispose of any assets to an Affiliate, (iii)
                  merge into or consolidate with or purchase or acquire assets
                  from an Affiliate; (iv) make any payments to any Affiliate or
                  otherwise suffer to exist any transaction with any Affiliate
                  or (v) enter into any other transaction directly or indirectly
                  with or for the benefit of any Affiliate (including, without
                  limitation, guarantees and assumptions of obligations of an
                  Affiliate); provided, however, that (a) any Affiliate who is
                  an individual may serve as an employee, director, consultant
                  or independent contractor of the Borrower or any of its
                  Subsidiaries and receive reasonable compensation for services
                  rendered in such capacity and (b) any of the Borrower's
                  Subsidiaries or the Borrower may enter into any transaction
                  with another Subsidiary or the Borrower which is not otherwise
                  prohibited by this Agreement or any of the other Credit
                  Documents, provided that the terms of any transaction pursuant
                  to which any Affiliate (other than Affiliates that are also
                  Subsidiaries of the Borrower) owes money to the Borrower shall
                  be at least arms length and the terms of any transaction
                  pursuant to which the Borrower and/or any Subsidiary owes
                  money to an Affiliate (other than Affiliates that are also
                  Subsidiaries of the Borrower) shall not be more onerous than
                  would obtain in an arms length transaction.

         8.17     Use of Proceeds. Use the proceeds of any Loan made hereunder
                  for any purpose other than the purposes described in Section
                  6.03 hereof.

         8.18     Change Fiscal Year. As to the Borrower only, change its
                  fiscal year to end on any date other than December 31.


                             IX. EVENTS OF DEFAULT.
                                 ------------------

         Each of the following shall constitute an event of default ("Event of
Default") hereunder:

         9.01     Payment Default. The Borrower shall (i) fail to pay any
                  principal of, or interest on, the Loans within 2 Business Days
                  of the due date thereof or (ii) default in 


                                      -46-

<PAGE>

                  the payment any other amounts owing hereunder, under the Notes
                  or under any other Credit Document and such default shall
                  continue for a period of 2 Business Days after the Bank
                  provides notice thereof to the Borrower;

         9.02     Negative Covenant Breach. The Borrower shall default in the
                  due performance or observance by it of any term, covenant or
                  agreement contained in Article VIII hereof;

         9.03     Other Covenant Breaches. The Borrower, or any Subsidiary of
                  the Borrower, shall default in the due performance or
                  observance of any term, covenant or agreement (other than
                  those referred to in Sections 9.01 and 9.02 above) contained
                  in this Agreement, the Notes or any other Credit Document, and
                  such default shall continue unremedied for a period of at
                  least 10 days after the earlier to occur of (i) the date the
                  Borrower obtains actual knowledge of such default or (ii) the
                  date notice of such default is given to the Borrower by the
                  Bank;

         9.04     Default Under Agreements for Borrowed Money. (i) The Borrower
                  or any Subsidiary of the Borrower shall default in any payment
                  with respect to any Indebtedness in excess of $750,000
                  (individually or in the aggregate as to the Borrower and its
                  Subsidiaries) beyond the period of grace, if any, provided in
                  the instrument or agreement under which such Indebtedness was
                  created or default in the observance or performance of any
                  agreement or condition relating to any such Indebtedness or
                  contained in any instrument or agreement evidencing, securing
                  or relating thereto, or any other event shall occur or
                  condition exist, the effect of which default or other event or
                  condition is to cause, or to permit the holder or holders of
                  such Indebtedness (or a trustee or agent on behalf of such
                  holder or holders) to cause (determined without regard to
                  whether any notice or lapse of time is required), any such
                  Indebtedness to become due prior to its stated maturity, or
                  (ii) any such Indebtedness shall be declared to be due and
                  payable, or required to be prepaid as a mandatory prepayment,
                  prior to the stated maturity thereof; provided, however, that
                  there shall not exist an Event of Default under this Section
                  9.04 if immediately upon obtaining knowledge of any potential
                  Event of Default under this Section 9.04, the Borrower
                  provides the Bank written notice of the facts and
                  circumstances pertaining thereto and the manner in which the
                  Borrower intends to contest, remedy or otherwise resolve the
                  same and the Bank consents to such contest, remedial action or
                  other form of resolution, which consent shall not be


                                      -47-

<PAGE>


                  unreasonably withheld; provided, further that the consent of
                  the Bank may be limited in duration to any reasonable time
                  period under the circumstances;

         9.05     Default Under Other Material Contracts. The Borrower or any
                  Subsidiary of the Borrower shall default in the due
                  performance or observance of any material term, covenant or
                  agreement contained in any contract, agreement, understanding
                  or arrangement, beyond the period of grace, if any, provided
                  in the relevant contract, and such default shall result, or is
                  reasonably expected to result, in a Material Adverse Effect;
                  provided, however that there shall not exist an Event of
                  Default under this Section 9.05 if immediately upon obtaining
                  knowledge of any potential Event of Default under this Section
                  9.05, the Borrower provides the Bank written notice of the
                  facts and circumstances pertaining thereto and the manner in
                  which the Borrower intends to contest, remedy or otherwise
                  resolve the same and the Bank consents to such contest,
                  remedial action or other form of resolution, which consent
                  shall not be unreasonably withheld; provided, further that the
                  consent of the Bank may be limited in duration to any
                  reasonable time period under the circumstances;

         9.06     Voluntary Bankruptcy. The Borrower or any Subsidiary of the
                  Borrower commences any bankruptcy, reorganization, debt
                  arrangement, or other case or proceeding under the United
                  States Bankruptcy Code or under any similar foreign, federal,
                  state, or local statute, or any dissolution or liquidation
                  proceeding, or makes a general assignment for the benefit of
                  creditors, or takes any action for the purpose of effecting
                  any of the foregoing;

         9.07     Involuntary Bankruptcy. Any bankruptcy, reorganization, debt
                  arrangement, or other case or proceeding under the United
                  States Bankruptcy Code or under similar foreign, federal,
                  state or local statute, or any dissolution or liquidation
                  proceeding, is involuntarily commenced against or in respect
                  of the Borrower or any of its Subsidiaries and such case or
                  proceeding is not dismissed or stayed within 30 days of such
                  commencement;

         9.08     Appointment of Receiver. The appointment, or the filing of a
                  petition seeking the appointment of a custodian, receiver,
                  trustee, or liquidator for any Borrower or any of their
                  respective property, or the taking of possession of any part
                  of the property of the Borrower or of any of its Subsidiaries,
                  at the instance of any Governmental Authority;


                                      -48-

<PAGE>

         9.09     Insolvency. The Borrower or any of its Subsidiaries becomes
                  insolvent (however defined), is generally not paying its debts
                  as they become due, or has suspended transaction of its usual
                  business (except any suspension incidental to any corporate
                  transaction permitted pursuant to Section 8.03(A) hereof);
                  provided however that, with respect to any Subsidiary of the
                  Borrower, the foregoing shall not be an Event of Default
                  unless it shall result, or is reasonably expected to result,
                  in a Material Adverse Effect;

         9.10     Reorganization. The dissolution, merger, consolidation, or
                  reorganization of the Borrower or any Subsidiary of the
                  Borrower; provide however that, with respect to any Subsidiary
                  of the Borrower, the foregoing shall not be an Event of
                  Default unless it shall result, or is reasonably expected to
                  result, in a Material Adverse Effect;

         9.11     Material Misstatement. Any statement, representation or
                  warranty made in or pursuant to this Agreement or any other
                  Credit Document shall prove to be untrue or misleading in any
                  material respect;

         9.12     Entry of Judgment. The entry or issuance of judgments, orders,
                  decrees or fines against the Borrower or any Subsidiary of the
                  Borrower which, in the aggregate, involve liabilities in
                  excess of the sum of $250,000 (the discharge of which is not
                  the obligation of any insurance company) and any such
                  judgments or orders involving liabilities in excess of said
                  sum shall have continued unbonded or unsatisfied and without
                  stay of execution or agreement between the parties thereon for
                  a period of 30 days after the entry or issuance of such
                  judgment; or

         9.13     Change of Control. The failure of any 2 of either Joel Cartun,
                  Leslie M. Abcug or Gary J. Marcello, to continue to function
                  as executive officers of the Borrower or its Subsidiaries in
                  substantially the same manner and with substantially the same
                  responsibilities with respect to the day-to-day operations of
                  the Borrower and its Subsidiaries as exists as of the Closing
                  Date.

                                  X. REMEDIES.
                                     ---------

        10.01     Acceleration of Obligations; Other Remedies. Upon and
                  following the occurrence of an Event of Default described in
                  Article IX hereof (other than the Events of 


                                      -49-

<PAGE>

                  Default described in Sections 9.06, 9.07, and 9.08 hereof), at
                  the Bank's sole option, the Bank's commitment, if any, to make
                  any further advance or Loans hereunder shall terminate and all
                  Obligations shall immediately become due and payable in full,
                  all without protest, presentment, demand or further notice of
                  any kind to the Borrower, all of which are expressly waived.
                  Upon the occurrence of the Event of Default described in
                  Sections 9.06, 9.07, and 9.08 hereof, immediately and
                  automatically, the Bank's commitment, if any, to make any
                  further advances or Loans hereunder shall terminate and all
                  Obligations shall immediately become due and payable in full,
                  all without protest, presentment, demand or further notice of
                  any kind to the Borrower, all of which are expressly waived.
                  Upon and following an Event of Default, the Bank may, at its
                  option, exercise any and all rights and remedies it has under
                  this Agreement, any other Credit Document and/or applicable
                  law, including, without limitation, the right to charge and
                  collect interest on the principal portion of the Obligations
                  at a rate equal to the lesser of: (i) the highest rate of
                  interest set forth in the Credit Documents, or (ii) the
                  highest rate of interest allowed by law, such rate of interest
                  to apply to the Obligations, at the Bank's option, upon and
                  after an Event of Default so long as of it shall continue,
                  maturity, whether by acceleration or otherwise, and the entry
                  of a judgment in favor of the Bank with respect to any or all
                  of the Obligations. Upon and following an Event of Default,
                  the Bank may proceed to protect and enforce the Bank's rights
                  under any Credit Document and/or under applicable law by
                  action at law, in equity or other appropriate proceeding
                  including, without limitation, an action for specific
                  performance to enforce or aid in the enforcement of any
                  provision contained herein or in any other Credit Document.

        10.02     Right of Set-off. If any of the Obligations shall be due and
                  payable or any one or more Events of Default shall have
                  occurred and be continuing, whether or not the Bank shall have
                  made demand under any Credit Document and regardless of the
                  adequacy of any collateral for the Obligations or other means
                  of obtaining repayment of the Obligations, the Bank shall have
                  the right, without notice to any Borrower, and is specifically
                  authorized hereby to set-off against and apply to the then
                  unpaid balance of the Obligations any items or funds of any
                  Borrower held by the Bank, any and all deposits (whether
                  general or special, time or demand, matured or unmatured) or
                  any other property of the Borrower, including, without
                  limitation, securities 


                                      -50-

<PAGE>

                  and/or certificates of deposit, now or hereafter maintained by
                  the Borrower for its or their own account with the Bank, and
                  any other indebtedness at any time held or owing by the Bank
                  to or for the credit or the account of any Borrower, even if
                  effecting such set-off results in a loss or reduction of
                  interest or the imposition of a penalty applicable to the
                  early withdrawal of time deposits. For such purpose, the Bank
                  shall have, and the Borrower hereby grants to the Bank, a lien
                  on and security interest in such deposits, property, funds and
                  accounts and the proceeds thereof.

        10.03     Remedies Cumulative; No Waiver or Impairment. The rights,
                  powers and remedies of the Bank provided in this Agreement and
                  any of the Credit Documents are cumulative and not exclusive
                  of any right, power or remedy provided by law or equity. No
                  failure or delay on the part of the Bank in the exercise of
                  any right, power or remedy shall operate as a waiver thereof,
                  nor shall any single or partial exercise preclude any other or
                  further exercise thereof, or the exercise of any other right,
                  power or remedy.

                               XI. MISCELLANEOUS.
                                   --------------

        11.01     Notices. Notices and communications under this Agreement and
                  the other Credit Documents shall be in writing and shall be
                  given by either (i) hand-delivery, (ii) certified mail (return
                  receipt requested, postage prepaid), (iii) reliable overnight
                  commercial courier (charges prepaid), or (iv) telecopy, to the
                  addresses and telecopy numbers listed in this Agreement.
                  Notice given by telecopy shall be deemed to have been given
                  and received when sent. Notice by overnight courier shall be
                  deemed to have been given and received on the date scheduled
                  for delivery. Notice by certified mail shall be deemed to have
                  been given and received on the dates indicated on the receipt
                  returned to the sender thereof. A party may change its address
                  and/or telecopier number by giving written notice to the other
                  party as specified herein.

        11.02     Costs and Expenses. Whether or not the transactions
                  contemplated by the Credit Documents are fully consummated,
                  the Borrower shall promptly pay (or reimburse, as the Bank may
                  elect) all reasonable costs and expenses which the Bank has
                  incurred or may hereafter incur in connection with the
                  negotiation, preparation, reproduction, interpretation,
                  perfection, monitoring, administration and enforcement of the
                  Credit Documents, the collection of all amounts due under the
             

                                      -51-

<PAGE>

                  Credit Documents, and all amendments, modifications, consents
                  or waivers, if any, to the Credit Documents. Such costs and
                  expenses shall include, without limitation, the reasonable
                  fees and disbursements of counsel to the Bank, searches of
                  public records, costs of filing and recording documents with
                  public offices, internal and/or external audit and/or
                  examination fees and costs (but only to the extent that the
                  Borrower shall be responsible for such audit and examination
                  fees and expenses pursuant to Section 7.08 hereof), stamp,
                  excise and other taxes and costs and expenses incurred by the
                  Bank, and the fees of the Bank's accountants, consultants or
                  other professionals; provided, that it is hereby acknowledged
                  and agreed that the Borrower shall not be responsible and the
                  Bank may not seek payment or reimbursement from the Borrower
                  for the legal fees (exclusive of reasonable disbursements) of
                  the Bank's outside counsel in excess of $15,000 for
                  professional services rendered in connection with the
                  negotiations and preparation of the Credit Documents executed
                  and delivered on the Closing Date and the consummation of the
                  transactions therein contemplated. The Borrower's
                  reimbursement obligations under this paragraph shall survive
                  any termination of the Credit Documents.

        11.03     Payment Due on a Day Other Than a Business Day. If any payment
                  due or action to be taken under this Agreement or any Credit
                  Document falls due or is required to be taken on a day that is
                  not a Business Day, such payment or action shall be made or
                  taken on the next succeeding Business Day and such extended
                  time shall be included in the computation of interest.

        11.04     Governing Law. This Agreement shall be construed in accordance
                  with and governed by the substantive laws of the State of New
                  Jersey without reference to conflict of laws principles.

        11.05     Integration. This Agreement and the other Credit Documents
                  constitute the sole agreement of the parties with respect to
                  the subject matter hereof and thereof and supersede all oral
                  negotiations and prior writings with respect to the subject
                  matter hereof and thereof.

        11.06     Amendment; Waiver. No amendment of this Agreement, and no
                  waiver of any one or more of the provisions hereof shall be
                  effective unless set forth in writing and signed by the
                  parties hereto.

        11.07     Successors and Assigns. This Agreement (i) shall be binding
                  upon the Borrower and the Bank and their 



                                      -52-
<PAGE>

                  respective successors and permitted assigns, and (ii) shall
                  inure to the benefit of the Borrower and the Bank and their
                  respective successors and permitted assigns; provided,
                  however, that the Borrower may not assign its rights hereunder
                  or any interest herein without the prior written consent of
                  the Bank, and any such assignment or attempted assignment by
                  the Borrower shall be void and of no effect with respect to
                  the Bank.

        11.08     Sale, Assignment or Participations. The Bank may from time to
                  time sell or assign, in whole or in part, or grant
                  participations in some or all of the Credit Documents and/or
                  the obligations evidenced thereby. The holder of any such
                  sale, assignment or participation, if the applicable agreement
                  between the Bank and such holder so provides, (i) shall be
                  entitled to all of the rights, obligations and benefits of the
                  Bank and (ii) shall be deemed to hold and may exercise the
                  rights of set-off or banker's lien with respect to any and all
                  obligations of such holder to the Borrower, in each case as
                  fully as though the Borrower were directly indebted to such
                  holder. The Bank may, in its discretion, give notice to the
                  Borrower of such sale, assignment or participation; however,
                  the failure to give such notice shall not affect any of the
                  Bank's or such holder's rights hereunder. The Borrower
                  authorizes the Bank to provide information concerning the
                  Borrower to any prospective purchaser, assignee or
                  participant, subject to such other party's agreement to the
                  provisions of Section 11.15 hereof. The information provided
                  may include, but is not limited to, amounts, terms, balances,
                  payment history, return item history and any financial or
                  other information about the Borrower. The Borrower agrees to
                  indemnify, defend, and hold the Bank harmless at the
                  Borrower's cost and expense, from and against any and all
                  lawsuits, claims, actions, proceedings, or suits against the
                  Bank or against the Borrower and the Bank, arising out of or
                  relating to the disclosure by the Bank of such information to
                  any prospective purchaser, assignee or participant to the
                  extent that such information does not comport with the
                  requirements set forth in Section 6.17 hereof as of the date
                  such information was furnished to the Bank by, or on behalf
                  of, the Borrower.

        11.09     Severability. The illegality or unenforceability of any
                  provision of this Agreement or any instrument or agreement
                  required hereunder shall not in any way affect or impair the
                  legality or enforceability of the remaining provisions of this
                  Agreement or any instrument or agreement required hereunder.
                  In lieu of any illegal


                                      -53-

<PAGE>

                  or unenforceable provision in this Agreement, there shall be
                  added automatically as a part of this Agreement a legal and
                  enforceable provision as similar in terms to such illegal or
                  unenforceable provision as may be possible.

        11.10     Consent to Jurisdiction and Service of Process. The Borrower
                  irrevocably appoints each and every corporate officer of the
                  Borrower as its attorneys upon whom may be served, by regular
                  or certified mail at the address set forth in this Agreement,
                  any notice, process or pleading in any action or proceeding
                  against it arising out of or in connection with this Agreement
                  or any of the other Credit Documents. The Borrower hereby
                  consents that any action or proceeding against it may be
                  commenced and maintained in any court within the State of New
                  Jersey or in the United States District Court for the District
                  of New Jersey by service of process on any such officer. The
                  Borrower further agrees that such courts of the State of New
                  Jersey and the United States District Court for the District
                  of New Jersey shall have jurisdiction with respect to the
                  subject matter hereof and the person of the Borrower and all
                  collateral for the Obligations. Notwithstanding the foregoing,
                  the Borrower agrees that any action brought by the Borrower
                  shall be commenced and maintained only in a court in the
                  federal judicial district or county in which the Bank has its
                  principal place of business in New Jersey.

        11.11     Indemnification.

                  (a) The Borrower agrees to indemnify and hold harmless the
                  Bank and its officers, directors, employees, agents and
                  advisors (each, an "Indemnified Party") from the against any
                  and all claims, damages, losses, liabilities and reasonable
                  expenses (including, without limitation, reasonable fees and
                  expenses of counsel; provided, that, in the case of fees and
                  expenses of counsel for the Indemnified Parties, the Borrower
                  shall be obligated to pay only the fees and expenses of a
                  single counsel in any one jurisdiction) that may be incurred
                  by or asserted or awarded against any Indemnified Party, in
                  each case arising out of or in connection with or by reason
                  of, or in connection with the preparation for a defense of any
                  investigation, litigation or proceeding arising out of,
                  related to or in connection with (i) the actual proposed use
                  of the proceeds or the Loan or Letter of Credit, the Credit
                  Documents or any of the transactions contemplated thereby,
                  including, without limitation, any acquisition or proposed
                  acquisition by the Borrower or any of its Subsidiaries in each
             



                                     -54-
<PAGE>

                  case whether or not such investigation, litigation or
                  proceeding is brought by any Indemnified Party or any
                  Indemnified Party is otherwise a party thereto and whether or
                  not the transactions contemplated hereby are consummated,
                  except to the extent such claim, damage, loss, liability or
                  expense is found in a final, non-appealable judgment by a
                  court of competent jurisdiction to have resulted from such
                  Indemnified Party's gross negligence or willful misconduct.

                  (b) If, after receipt of any payment of all or any part of the
                  Obligations, the Bank is compelled or (after notice to the
                  Borrower) agrees, for settlement purposes, to surrender such
                  payment to any person or entity for any reason (including,
                  without limitation, a determination that such payment is void
                  or voidable as a preference or fraudulent conveyance, an
                  impermissible set-off, or a diversion of trust funds), then
                  this Agreement and the other Credit Documents shall continue
                  in full force and effect, and the Borrower shall be liable
                  for, and shall indemnify, defend and hold harmless the Bank
                  with respect to the full amount so surrendered.

                  (c) Without limiting the applicability of the clause (a) of
                  this Section 11.11, the Borrower shall indemnify, defend and
                  hold harmless the Bank with respect to any and all claims,
                  expenses, demands, losses, costs, fines or liabilities of any
                  kind (including, without limitation, those involving death,
                  personal injury or property damage and including reasonable
                  attorneys fees and costs) arising from or in any way related
                  to any hazardous materials or a dangerous environmental
                  condition within, on, from, related to or affecting any real
                  property owned or occupied by the Borrower including, without
                  limitation, any and all claims that may arise as a result of
                  an intentional or unintentional act or omission of any
                  Borrower, any previous owner and/or operator of real property
                  owned or occupied by the Borrower that resulted in the
                  discharge of hazardous substances or wastes into the
                  atmosphere or waters or onto the lands.

                  (d) The provisions of this Section 11.11 shall survive the
                  termination of this Agreement and the other Credit Documents
                  and shall be and remain effective notwithstanding the payment
                  of the Obligations, the release of any security interest, lien
                  or encumbrance securing the Obligations or any other action
                  which the Bank may have taken in reliance upon its receipt of
                  such payment. Any action by the Bank shall be deemed to have



                                      -55-

<PAGE>

                  been conditioned upon any payment of the Obligations having
                  become final and irrevocable.

        11.12     Inconsistencies. The Credit Documents are intended to be
                  consistent. However, in the event of any inconsistencies among
                  any of the Credit Documents, such inconsistency shall not
                  affect the validity or enforceability of each Credit Document.
                  The Borrower agrees that in the event of any inconsistency or
                  ambiguity in any of the Credit Documents, the Credit Documents
                  shall not be construed against any one party but shall be
                  interpreted consistent with the Bank's policies and
                  procedures.

        11.13     Headings. The headings of articles, Sections and paragraphs
                  have been included herein for convenience only and shall not
                  be considered in interpreting this Agreement.

        11.14     Schedules. All Schedules, Annexes and/or an Exhibits attached
                  hereto are incorporated herein.

        11.15     Confidentiality. The Bank shall not disclose any Confidential
                  Information to any Person without the prior consent of the
                  Borrower, other than (i) to its officers, directors,
                  employees, agents and advisors and to actual or prospective
                  purchaser, assignee, or participant of or in the Loans and
                  participants, and then only on a confidential basis, (ii) as
                  required by any law, rule or regulation or judicial process
                  and (iii) as requested or required by any Governmental
                  Authority or examiner regarding banks or banking.

        11.16     Judicial Proceeding; Waivers.

                  (a) EACH PARTY TO THIS AGREEMENT AGREES THAT ANY SUIT, ACTION
                  OR PROCEEDING, WHETHER CLAIM OR COUNTER-CLAIM, BROUGHT OR
                  INSTITUTED BY ANY PARTY HERETO OR ANY SUCCESSOR OR ASSIGN OF
                  ANY PARTY, ON OR WITH RESPECT TO THIS AGREEMENT OR ANY OF THE
                  OTHER CREDIT DOCUMENTS OR THE DEALINGS OF THE PARTIES WITH
                  RESPECT HERETO, OR THERETO, SHALL BE TRIED ONLY BY A COURT AND
                  NOT BY A JURY.

                  (b) EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
                  WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION
                  OR PROCEEDING. FURTHER, EACH PARTY WAIVES ANY RIGHT IT MAY
                  HAVE TO CLAIM OR RECOVER, IN ANY SUCH SUIT, ACTION OR
                  PROCEEDING, ANY SPECIAL, EXEMPLARY,


                                      -56-

<PAGE>

                  PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN,
                  OR IN ADDITION TO, ACTUAL DAMAGES.

                  (c) THE BORROWER ACKNOWLEDGES AND AGREES THAT THIS SECTION IS
                  A SPECIFIC AND MATERIAL ASPECT OF THIS AGREEMENT AND THAT THE
                  BANK WOULD NOT EXTEND CREDIT TO ANY BORROWER IF THE WAIVERS
                  SET FORTH IN THIS SECTION WERE NOT A PART OF THIS AGREEMENT.

        11.17     Counterparts. This Agreement may be executed in as many
                  counterparts as may be deemed necessary or convenient, and by
                  the different parties hereto on separate counterparts, each of
                  which, when so executed, shall be deemed an original but all
                  such counterparts shall constitute but one and the same
                  instrument.






                                      -57-

<PAGE>


         IN WITNESS WHEREOF, the parties by their duly authorized
representatives have executed this Agreement as of the day and year first above
written.

WITNESS/ATTEST:                            VESTCOM INTERNATIONAL, INC.


By: /s/ S                                  By: /s/ S
   --------------------------------           ----------------------------------
   Name:                                      Name:
   Title:                                     Title:

                                           Address: 1100 Valley Brook Avenue
                                                    Lyndhurst, New Jersey 07071
                                                    Attention:_________________

                                           Telecopier:_____________________


                                           SUMMIT BANK


                                           By: /s/ S
                                              ----------------------------------
                                              Name:
                                              Title:

                                           Address: 250 Moore Street
                                                    Hackensack, New Jersey 07601
                                                    Attention:  Michael Bernal
                                                                Vice President

                                           Telecopier: (201) 488-6185






                                      -58-


<PAGE>

                              AMENDMENT NUMBER ONE
                                       TO
                EQUIPMENT FACILITY AND REVOLVING CREDIT AGREEMENT


         This AMENDMENT NUMBER ONE (the "Amendment") amends the Equipment
Facility and Revolving Credit Agreement by and between Summit Bank (the "Bank")
and Vestcom International, Inc. ("Vestcom") dated as of August 13, 1997 (the
"Credit Facility"), and is entered into as of the 28th day of July, 1998.

         WHEREAS, both the Bank and Vestcom desire to amend and modify the
Credit Facility to delete a covenant which is no longer required.

         NOW THEREFORE, for good and valuable consideration, the parties hereto
hereby agree as follows:

         1. Section 9.13, Change in Control, of the Credit Facility is hereby
            amended to be deleted in its entirety and the following is to be
            inserted in lieu thereof: "intentionally left blank".

         2. All other terms and conditions of the Credit Facility shall remain
            unchanged and in full force and affect.

         IN WITNESS WHEREOF, the parties hereto by their duly authorized
representatives have executed this Amendment Number One to the Credit Facility
as of the date first written above.


                                      VESTCOM INTERNATIONAL, INC.



                                      By:  /s/Harvey Goldman
                                           -----------------------------------
                                           Harvey Goldman
                                           Executive Vice President
                                           and Chief Financial Officer


                                      SUMMIT BANK


                                      By:  /s/Michael Bernal
                                           -----------------------------------  
                                           Name:
                                           Title:


<PAGE>


                         WAIVER AND AMENDMENT NUMBER TWO
                                     TO THE
                EQUIPMENT FACILITY AND REVOLVING CREDIT AGREEMENT


         This WAIVER AND AMENDMENT NUMBER TWO (the "Amendment") amends the
Equipment Facility and Revolving Credit Agreement by and between Summit Bank
(the "Bank") and Vestcom International, Inc. ("Vestcom") dated as of August 13,
1997 (the "Credit Facility"), and is a waiver of a certain covenant thereof and
is entered into as of the 16th day of February, 1999.

         WHEREAS, both the Bank and Vestcom desire to amend and modify the
Credit Facility to amend a certain covenant; and

         WHEREAS, in addition to modifying a certain covenant, the Bank has
waived the applicability of such covenant for calendar year 1998 and the parties
desire to document such waiver.

         NOW THEREFORE, for good and valuable consideration, the parties hereto
hereby agree as follows:

         1.   Pursuant to Article XI, Section 11.06 of the Credit Facility, the
              Bank hereby waives Vestcom's compliance with Article VIII, Section
              8.13, Consolidated Tangible to Stated Net Worth, for the entire
              calendar year 1998.

         2.   In addition, pursuant to Article XI, Section 11.06 of the Credit
              Facility, the current language of Article VIII, Section 8.13,
              Consolidated Tangible to Stated Net Worth, is hereby deleted in
              its entirety, and shall be replaced with the following in lieu
              thereof:

              8.13 Consolidated Tangible to Stated Net Worth. Permit at any
              time, its Consolidated Tangible Net Worth to be any less than 10%
              of the Consolidated Stated Net Worth, tested no less frequently
              than quarterly and determined in accordance with GAAP,
              consistently applied.

         3.   The amendment to Section 8.13 pursuant to paragraph two above
              shall be effective as of January 1, 1999.

         4.   All other terms and conditions of the Credit Facility shall remain
              unchanged and in full force and affect.




<PAGE>


         IN WITNESS WHEREOF, the parties hereto by their duly authorized
representatives have executed this Waiver and Amendment Number Two to the Credit
Facility as of the date first written above.


                                          VESTCOM INTERNATIONAL, INC.



                                          By:  /s/Harvey Goldman
                                               -------------------------------  
                                               Harvey Goldman
                                               Executive Vice President
                                               and Chief Financial Officer


                                         SUMMIT BANK



                                         By:   /s/Michael Bernal
                                               -------------------------------  
                                               Name:
                                               Title:

<PAGE>


                                   MEMORANDUM
                        REGARDING EQUIPMENT FACILITY AND
                           REVOLVING CREDIT AGREEMENT
                                 BY AND BETWEEN
                                   SUMMIT BANK
                                       AND
               VESTCOM INTERNATIONAL, INC. (the "Credit Facility")

                           Dated as of August 13, 1997


         This MEMORANDUM, dated as of March 29, 1999, is intended to memorialize
the parties understanding of an error in the Credit Facility, and to correct
such error. Both parties agree that Section 8.15 Consolidated Fixed Charges
Ratio is incorrect as currently written, and should be modified to read, in its
entirety, as follows:

         "Section 8.15 Consolidated Fixed Charges Ratio. Permit at any time its
         Consolidated Fixed Charges Ratio to be less than 1.50 to 1.00, tested
         no less frequently than quarterly for each Test Period and determined
         in each case in accordance with GAAP, consistently applied."

                  In addition, the parties hereby agree, Section 8.15 should
have been written as shown above from the effective date of the Credit Facility.

         In WITNESS WHEREOF, the parties, by their duly authorized
representatives, have executed this Memorandum as of the day and year first
above written.


                                                     Vestcom International, Inc.


                                                          By:/s/ Brendan Keating
                                                             -------------------
                                                             Name:
                                                             Title:

                                                           Summit Bank


                                                           By:/s/ Michael Bernal
                                                              ------------------
                                                              Name:
                                                              Title:


                                                           By:/s/ James Noonan 
                                                              ------------------
                                                              Name:
                                                              Title: