SECURITY AGREEMENT

            THIS SECURITY AGREEMENT (this "Agreement") is made and entered into
as of March 25, 1998 between BUSINESS LOAN CENTER, INC., a Delaware corporation
with its principal place of business located at 645 Madison Avenue, 17th Floor,
New York, New York 10022 ("Debtor"), and TRANSAMERICA BUSINESS CREDIT
CORPORATION, a Delaware corporation with its principal place of business located
at 9399 West Higgins Road, Suite 600, Rosemont, Illinois 60018 ("Secured
Party"), with reference to the following facts:

                                    RECITALS

      A. Debtor, BLC Financial Services, Inc., a Delaware corporation, and
Secured Party are concurrently entering into a Loan Agreement pursuant to which
Secured Party has agreed to provide a revolving credit facility in the maximum
amount of up to Twenty-Five Million Dollars ($25,000,000) to Debtor upon the
terms and conditions set forth therein (as the same may from time to time be
amended, modified or supplemented, being hereinafter called the "Loan
Agreement").

      B. Secured Party has conditioned its obligations under the Loan Agreement
upon the execution and delivery by Debtor of this Agreement and Debtor has
agreed to enter into this Agreement.

      C. In order to comply with the terms and conditions of the Loan Agreement
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Debtor hereby agrees with Secured Party as
follows:

                                    ARTICLE I

                                  GENERAL TERMS

      1.1 Defined Terms. Unless otherwise defined herein, capitalized terms used
herein shall have the meanings assigned to them in the Loan Agreement, and the
following terms shall have the following meanings, unless the context otherwise
requires (such meanings being equally applicable to both the singular and plural
form of the terms defined):
<PAGE>

            "Accounts" means all accounts, Notes Receivable, contract rights,
      chattel paper, instruments and documents (as such terms are defined in the
      UCC), including all accounts receivable, other receivables, and other
      forms of obligations, whether now owned or hereafter created or acquired
      by Debtor or in which Debtor now has or hereafter acquires any interest.

            "Account Debtor" means any Person liable (whether directly or
      indirectly, or primarily or secondarily) for the payment or performance of
      any obligations or undertakings included in the Collateral, whether as an
      account debtor (as defined in the UCC), obligor in respect of instruments
      or Investment Property, issuer of documents or securities, guarantor or
      otherwise.

            "Agreement" means this Security Agreement, as the same may from time
      to time be amended, modified or supplemented.

            "Collateral" shall have the meaning assigned to such term in Section
      2.1.

            "Debtor" shall have the meaning assigned to such term in the
      preamble of this Agreement.

            "Event of Default" means any event specified in Section 6.1.

            "General Intangibles" means all personal property other than goods,
      accounts, chattel paper, documents, instruments, Investment Property, and
      money. Such personal property shall include all letters of credit, bonds,
      guaranties, and other contractual rights (whether similar or dissimilar),
      rights to performance, and claims for damages, rights to refunds
      (including tax refunds) or other monies due or to become due; all orders,
      franchises, permits, certificates, licenses, consents, exemptions,
      variances, authorizations or other approvals by any governmental agency or
      court; literary rights, patents, patent applications, copyrights,
      trademarks, trademark applications, labels, trade names and trade styles
      and goodwill; all customer lists, business records, computer programs and
      tapes and computer software; all claims under guaranties, security
      interests, liens, or other security held by or granted to Debtor to secure
      payment of any of the Accounts or loans made to an Account Debtor; deposit
      accounts and other bank accounts, and all rights to indemnification and
      all other intangible property 


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<PAGE>

      of every kind and nature, whether similar or dissimilar to the foregoing.
      General Intangibles shall not include Debtor's rights under its Loan
      Guaranty Agreement, Form 750, or its SBLC Participation Agreement, Form
      1082.

            "Investment Property" all investment property (as such term is
      defined in the UCC), including all securities, whether certificated or
      uncertificated, all security entitlements, all security accounts, all
      commodity contracts and all commodity accounts.

            "Loan Agreement" shall have the meaning assigned to such term in the
      Recitals of this Agreement.

            "Secured Party" shall have the meaning assigned to such term in the
      preamble of this Agreement.

      1.2 Certain Matters of Construction. The terms "herein", "hereof" and
"hereunder" and other words of similar import shall refer to this Agreement as a
whole and not to any particular section, paragraph or subdivision. Any reference
to a "Section," "Exhibit," "Article," or "Schedule" shall refer to the relevant
Section or Article of or Exhibit or Schedule to this Agreement, unless
specifically indicated to the contrary. Any pronoun used shall be deemed to
cover all genders. The term "including" shall not be limiting or exclusive,
unless specifically indicated to the contrary. All references to statutes and
related regulations shall include any amendments of same and any successor
statutes and regulations.

                                   ARTICLE II

                                SECURITY INTEREST

      2.1 Grant of Security Interest. To secure the prompt payment and
performance to Secured Party of the Liabilities, Debtor hereby irrevocably
grants to Secured Party a first, prior and continuing security interest in and
Lien upon the following property of Debtor to the extent of Debtor's interest
therein (the "Collateral") whether now owned or existing or hereafter acquired,
owned, existing or arising (whether acquired by contract or operation of law)
and wherever located, which shall be retained by Secured Party until all of the
Liabilities have been paid in full and this Agreement has been terminated:

            (a)   All Accounts;


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<PAGE>

            (b)   All inventory, equipment (including any and all computer
                  hardware and components), machinery and fixtures of Debtor in
                  all forms and wherever located, and all parts and products
                  thereof, all accessories thereto, and all documents therefor;

            (c)   All General Intangibles;

            (d)   All Investment Property;

            (e)   All monies, residues and property of any kind, now or at any
                  time or times hereafter, in the possession or under the
                  control of Secured Party or a bailee of Secured Party, except
                  for funds earned by Debtor as the "Servicing Fee" under the
                  Multi-Party Agreement;

            (f)   All leasehold interests in real property now owned or
                  hereafter acquired by Debtor as lessee or sublessor;

            (g)   All books and records (including any and all customer lists,
                  credit files, computer programs, printouts, and other computer
                  materials and records) of Debtor pertaining to any of the
                  foregoing;

            (h)   All other goods and personal property of Debtor, whether
                  tangible or intangible and whether now or hereafter owned or
                  existing, leased, or acquired by Debtor and wherever located;

            (i)   All accessions to, substitutions for and all replacements,
                  products and cash and non-cash proceeds of the foregoing,
                  including proceeds of insurance policies insuring the
                  Collateral (including claims paid and premium refunds).

      2.2 Additional Security. Additional property may from time to time be
pledged, assigned or granted to Secured Party as additional security for the
Liabilities, and the term "Collateral" as used herein shall be deemed for all
purposes hereof to include all such additional property, together with all other
property of the types described above related thereto.

                                   ARTICLE III


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<PAGE>

                     DEBTOR'S REPRESENTATIONS AND WARRANTIES

            In order to induce Secured Party to accept this Agreement, Debtor
represents and warrants to Secured Party (which representations and warranties
shall survive the creation and payment of the Liabilities) that, after giving
effect to the transactions, rights, and obligations contemplated and created by
the Multi-Party Agreement:

      3.1 Ownership of Collateral; Encumbrances; Valid and Binding Agreement.
Debtor is the legal and beneficial owner of the Collateral free and clear of any
adverse claim, lien, security interest, option or other charge or encumbrance
except for Permitted Liens and the security interest created by this Agreement,
and Debtor has full right, power and authority to assign and grant a security
interest in the Collateral to Secured Party. This Agreement creates a valid
first-priority security interest in the Collateral, securing the payment of the
Liabilities and constitutes a legal, valid and binding obligation of Debtor
enforceable against Debtor in accordance with its terms. The execution, delivery
and performance of this Agreement shall not violate the terms of any contract,
agreement, law, regulation, order, injunction, judgment, decree or writ to which
Debtor is subject and, except for consents and approvals which have previously
been obtained, does not require the consent or approval of any other Person.

      3.2 No Required Consent. No authorization, consent, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body (other than the filing of financing statements) is required for
(i) the due execution, delivery and performance by Debtor of this Agreement,
(ii) the grant by Debtor of the security interest granted by this Agreement,
other than the consent of SBA to the granting of a security interest in the
Collateral, which consent will be obtained on or before the Effective Date
pursuant to the Multi-Party Agreement, or (iii) the perfection of such security
interest or the exercise by Secured Party of its rights and remedies under this
Agreement.

      3.3 No Filings by Third Parties. Except for financing statements filed or
recorded in connection with Permitted Liens, no financing statement or other
public notice or recording covering the Collateral is on file in any public
office (other than any financing statement or other public notice or recording
naming Secured Party as the secured party therein), and Debtor 


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<PAGE>

shall not execute any such financing statement or other public notice or
recording in favor of any Person other than Secured Party so long as any of the
Liabilities are outstanding.

      3.4 No Name Changes. Debtor has not, during the preceding five (5) years,
entered into any contract, agreement, security instrument or other document
using a name other than, or been known by or otherwise used any name other than,
Business Loan Center or the name used by Debtor herein.

      3.5 Location of Debtor. Debtor's chief executive office and Debtor's books
and records concerning the Collateral are located at the address or location set
forth in the preamble of this Agreement.

      3.6 Information Regarding Collateral. All information supplied by Debtor
to Secured Party in connection with the Liabilities or the Collateral (either
prior or subsequent to the execution of this Agreement) is or (in the case of
subsequently furnished information) shall be true, correct, complete, valid and
genuine to the best knowledge of Debtor after due inquiry. The delivery at any
time by Debtor to Secured Party of Collateral or of additional specific
descriptions of certain Collateral shall constitute a representation and
warranty by Debtor to Secured Party hereunder that the representations and
warranties of this Section 3.6 are true and correct, to the best knowledge of
Debtor after due inquiry, with respect to each item of Collateral.

      3.7 Status of Accounts. All instruments comprising Accounts shall be
properly issued, drawn, made and/or accepted and shall be genuine; Debtor shall
have delivered possession of all such instruments to Intermediary within three
(3) Business Days of Debtor's receipt thereof; the issuer, drawer, maker, and/or
acceptor thereof shall have no defenses (including defenses of any party which
would be available in an action on a simple contract and the defenses of want or
failure of consideration, nonperformance of any condition precedent, 
non-delivery, or delivery for a special purpose), right of set-off or claims to
the Accounts; Debtor shall have good title to the Accounts; Debtor shall have no
knowledge that the signature of the issuer, drawer, maker and/or acceptor is
unauthorized; the Accounts shall not have been materially altered; all
signatures shall be genuine and authorized; no defense of any party shall be
good against Debtor; Debtor's transfer of the instruments comprising the
Accounts to Secured Party shall be effective and rightful; and Debtor does not
know of any fact which might impair


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<PAGE>

the validity of the instruments comprising the Accounts or of Secured Party's
Lien thereon.

      3.8 Federal Taxpayer Identification Number. Debtor's federal taxpayer
identification number is 13-3568801.

                                   ARTICLE IV

                             COVENANTS AND AGREEMENT

            Debtor shall at all times comply with the covenants and agreements
contained in this Article IV, from the date hereof and for so long as any part
of the Liabilities are outstanding.

      4.1 Change in Location of Debtor. Debtor shall provide written
notification to Secured Party thirty (30) days before the date of any proposed
change in the location of the chief executive office of Debtor.

      4.2 Change in Debtor's Name. Debtor shall not change its name, its
identity or its corporate structure without notifying Secured Party of such
change in writing at least thirty (30) days prior to the effective date of such
change. Without the express written consent of Secured Party, however, Debtor
shall not engage in any other business or transaction under any name other than
Business Loan Center or Debtor's name hereunder.

      4.3 Delivery of SBA 7(a) Loan Notes. Debtor shall, within three (3)
Business Days of Debtor's receipt thereof, deliver possession of all SBA 7(a)
Loan Notes to Intermediary pursuant to the Multi-Party Agreement.

      4.4 Maintenance of Existence. Debtor shall maintain Debtor's corporate
existence and remain in good standing and qualified to do business in all
jurisdictions wherein the business transacted by it makes such qualification
necessary except where the failure to so qualify would not have a Material
Adverse Effect.

      4.5 Sale, Disposition or Encumbrance of Collateral. Except to the extent
authorized pursuant to Sections 6.3 and 6.13 of the Loan Agreement, Debtor shall
not in any way encumber any of the Collateral (or permit or suffer any of the
Collateral to be encumbered) or sell, assign, lend, rent, lease or otherwise
dispose of or transfer any of the Collateral to or in favor of 


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<PAGE>

any Person other than Secured Party, without the prior written consent of
Secured Party.

      4.6 Proceeds of Collateral. Except as otherwise provided under Section
2.13 of the Loan Agreement, Debtor shall deliver to Secured Party promptly upon
receipt all proceeds delivered to Debtor from the sale or disposition of any
Collateral. If instruments are received as proceeds, they shall be, immediately
upon receipt, properly endorsed or assigned and delivered to Intermediary as
Collateral. This Section 4.6 shall not be construed to permit sales or
dispositions of Collateral except as may be elsewhere expressly permitted by
this Agreement or the Loan Agreement.

      4.7 Records Concerning Collateral, Financial Condition. Debtor shall keep
accurate and complete records of the Collateral (including proceeds). These
records shall reflect all facts concerning each Account including those
pertaining to Debtor's warranties, representations and agreements under this
Agreement. Secured Party may at all reasonable times have access to, examine,
audit, make extracts from and inspect without hindrance or delay Debtor's
records, files and the Collateral.

      4.8 Performance of Obligations. Debtor shall promptly perform all of its
obligations under any other agreement or contract of any kind now or hereafter
existing as security for or in connection with the payment of the Liabilities.

      4.9 Reimbursement of Expenses. Debtor shall pay to Secured Party all
advances, charges, costs and expenses (including all reasonable costs and
expenses of retaking, holding, preparing for sale and selling or otherwise
realizing upon the Collateral in the event of any default by Debtor and all
reasonable attorneys' fees, legal expenses and court costs), incurred by Secured
Party in connection with the transaction which gives rise to this Agreement or
the exercise of Secured Party's rights and remedies hereunder. Debtor hereby
assumes all liability for the Collateral and any use, possession, maintenance
and management by Debtor of any or all of the Collateral. Debtor shall indemnify
and hold Secured Party harmless from and against and covenants to defend Secured
Party against any and all losses, damages, claims, costs, penalties, liabilities
and expenses, including court costs and attorneys' fees incurred because of,
incident to, or with respect to the Collateral or any use, possession,
maintenance or management thereof by Debtor. All amounts for which Debtor is
liable pursuant to this Section 4.9 shall be due and payable by Debtor to
Secured Party within three (3) Business Days after 


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<PAGE>

demand is made therefor. If Debtor fails to make such payment upon demand,
Secured Party may pay such amount and the same shall be due and payable by
Debtor to Secured Party, together with interest accruing thereon at the rate
applicable from time to time to the Revolving Loans.

      4.10 Further Assurances.

            (a) Debtor agrees that from time to time, at the expense of Debtor,
provided that such action would not violate applicable SBA rules or regulations,
Debtor shall promptly execute and deliver all further instruments and documents,
and take all further action, that may be necessary or desirable, or that Secured
Party may reasonably request, in order to perfect and protect any security
interest granted or purported to be granted hereby or to enable Secured Party to
exercise and enforce its rights and remedies hereunder with respect to the
Collateral.

            (b) Debtor shall furnish to Secured Party from time to time
statements and schedules further identifying and describing its Collateral and
such other reports in connection with such Collateral as Secured Party may
reasonably request, all in reasonable detail and all in form and substance
satisfactory to Secured Party.

      4.11 Insurance. Debtor shall maintain, with financially sound and
reputable insurers, insurance to the extent required under Section 5.6 of the
Loan Agreement.

      4.12 Accounts.

            (a) Debtor shall immediately notify Secured Party in writing in the
event that any Account ceases to meet the requirements of this Agreement or any
other Loan Document, including any material change, in any fact or circumstance
warranted or represented by Debtor herein or in any other Loan Document at any
time furnished by Debtor to Secured Party in connection with the Liabilities.

            (b) Subject to the provisions of the Multi-Party Agreement, the Loan
Guaranty Agreement, and Section 6.13 of the Loan Agreement, Debtor shall not
modify, extend or substitute any contract, the terms of which shall at any time
have given rise to an Account, or adjust, settle, discount or compromise any of
the Accounts.


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<PAGE>

            (c) Debtor shall duly perform or cause to be performed all of
Debtor's obligations with respect to the Accounts and the underlying
transactions giving rise to the Accounts.

                                    ARTICLE V

                   RIGHTS, DUTIES AND POWERS OF SECURED PARTY

            The following rights, duties and powers of Secured Party are
applicable regardless of whether an Event of Default shall have occurred and be
continuing:

      5.1 Non-judicial Enforcement. Secured Party may enforce its rights
hereunder without prior judicial process or judicial hearing, and to the extent
permitted by applicable law Debtor expressly waives any and all legal rights
which might otherwise require Secured Party to enforce its rights by judicial
process.

      5.2 Discharge Encumbrances. Secured Party may at its option but without
any obligation to do so, and after written notice to Debtor of its intent to do
so, discharge any uncontested taxes, liens, security interests or other
encumbrances at any time levied or placed on the Collateral, may pay for
insurance on the Collateral and may pay for the maintenance and preservation of
the Collateral, in each case, only to the extent that Debtor does not do so.
Debtor agrees to reimburse secured Party immediately and without demand for any
payment so made, plus interest thereon at the rate applicable from time to time
to the Revolving Loans.

      5.3 Attorney-in-Fact. Debtor hereby appoints Secured Party as Debtor's
attorney-in-fact, with full authority in the place and stead of Debtor and in
the name of Debtor or otherwise, from time to time in Secured Party's
discretion, but at Debtor's cost and expense, and with notice in due course to
Debtor:

            (a) to receive, endorse and collect all instruments made payable to
      Debtor representing any payment or other distribution in respect of the
      Collateral or any part thereof and to give full discharge for the same;

            (b) to endorse any draft drawn by insurers of the Collateral, and
      Secured Party may apply any proceeds of such insurance to the Liabilities
      (whether or not due);


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<PAGE>

            (c) to take any action and execute any assignment, certificate,
      financing statement, notification, document or instrument, which Secured
      Party may deem necessary or advisable to accomplish the purposes of this
      Agreement;

            (d) to execute, assign and endorse negotiable and other instruments
      for the payment of money, documents of title or other evidences of
      payment, shipment or storage for any form of Collateral on behalf of and
      in the name of Debtor;

            (e) upon the occurrence and during the continuance of an Event of
      Default, to obtain, adjust, sell and cancel any insurance with respect to
      the Collateral.

      5.4 Transfer of Collateral. Secured Party may assign any or all of the
Indebtedness evidenced by the Liabilities to the extent permitted by Section 9.2
of the Loan Agreement and the Multi-Party Agreement, and upon any such
assignment Secured Party may assign any or all of the Collateral and shall be
fully discharged thereafter from all liability therefor. Upon becoming a party
to or assignee under the Multi-Party Agreement or otherwise receiving the
written approval of the SBA, any transferee of the Collateral shall be vested
with all rights, powers and remedies of Secured Party hereunder.

      5.5 Cumulative and Other Rights. The rights, powers and remedies of
Secured Party hereunder shall be in addition to all rights, powers and remedies
given by law or in equity. The exercise by Secured Party of any one or more of
the rights, powers and remedies herein shall not be construed as a waiver of any
other rights, powers and remedies.

      5.6 Disclaimer of Certain Duties. The powers conferred upon Secured Party
by this Agreement are to protect its interest in the Collateral and shall not
impose any duty upon Secured Party to exercise any such powers. Debtor hereby
agrees that Secured Party shall not be liable for, nor shall the Indebtedness
evidenced by the Liabilities be diminished by, Secured Party's failure to
collect upon, foreclose, sell, take possession of or otherwise obtain value for
the Collateral.

      5.7 Waiver of Notice, Demand, Presentment, etc. Except as otherwise
provided in the Loan Agreement, Debtor hereby waives any demand, notice of
default, notice of acceleration of the maturity of the Liabilities, notice of
intention to accelerate the maturity of the Liabilities, presentment, protest
and notice


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of dishonor as to any action taken by Secured Party in connection with this
Agreement, any note or other document.

      5.8 Account Debtors. To the extent and so long as Secured Party does not
elect to invoke its remedies under Section 2.14 of the Loan Agreement, Debtor
shall continue to collect the Accounts and place the Items of Payment (as
defined in the Loan Agreement) into the Blocked Account to the extent required
by the Loan Agreement, or to instruct Account Debtors to make deposits directly
into the Servicer Account, as set forth in Section 2.13 of the Loan Agreement.
Secured Party or its designee shall also have the right (i) to request
Accountant to send a request for verification of Liabilities or Accounts to any
Account Debtor, provided, that Secured Party simultaneously sends notice to
Debtor that such request for verification has been sent to Accountant and, if
Accountant fails to send such verification in a manner satisfactory to Secured
Party within thirty (30) days of Secured Party's request to do so, to send such
request for verification; and (ii) to do all other acts and things necessary to
carry out the intent of this Agreement. No Account Debtor on any Account shall
ever be bound to make inquiry as to the termination of this Agreement or the
rights of Secured Party to act hereunder, but shall be fully protected by Debtor
in making payment directly to Secured Party.

                                   ARTICLE VI

                                EVENTS OF DEFAULT

      6.1 Events of Default. Any event constituting an Event of Default under
the Loan Agreement shall also constitute an Event of Default under this
Agreement.

                                   ARTICLE VII

                                    REMEDIES

      7.1 Remedies. Upon the occurrence and during the continuance of any Event
of Default, and subject to the provisions of the Multi-Party Agreement, Secured
Party may take any or all of the following actions without notice (except where
expressly required below) or demand to Debtor:


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<PAGE>

            (a) Declare all or part of the Indebtedness pursuant to the
      Liabilities immediately due and payable and enforce payment of the same by
      Debtor.

            (b) Exercise in respect of the Collateral all of the rights and
      remedies of a Secured Party on default under the UCC.

            (c) Take possession of the Collateral, or at Secured Party's request
      Debtor shall, at Debtor's cost, assemble the Collateral and make it
      available at a location to be specified by Secured Party which is
      reasonably convenient to Debtor and Secured Party. The risk of accidental
      loss or damage to or diminution in value of Collateral shall be on Debtor,
      and Secured Party shall have no liability whatsoever for failure to obtain
      or maintain insurance, nor to determine whether any insurance ever in
      force is adequate as to amount or as to risk insured.

            (d) Sell or lease, in one or more sales or leases and in one or more
      parcels, or otherwise dispose of any or all of the Collateral in its then
      condition or in any other commercially reasonable manner as Secured Party
      may elect, in a public or private transaction, at any location as deemed
      reasonable by Secured Party (including Debtor's premises), either for cash
      or credit or for future delivery and (unless prohibited by the UCC, as
      adopted in any applicable jurisdiction) Secured Party may be the purchaser
      of any or all Collateral so sold and may apply against the purchase price
      therefor any Liabilities secured hereby. Any such sale or transfer by
      Secured Party either to itself or to any other Person shall be absolutely
      free from any claim or right by Debtor, including any equity or right of
      redemption, stay or appraisal which Debtor has or may have under any rule
      of law, regulation or statute now existing or hereafter adopted. Upon any
      such sale or transfer, Secured Party shall have the right to deliver,
      assign and transfer to the purchaser or transferee thereof the Collateral
      so sold or transferred. It shall not be necessary that the Collateral or
      any part thereof be present at the location of any such sale or transfer.
      Secured Party may, at its discretion, provide for a public sale, and any
      such public sale shall be held at such time or times within ordinary
      business hours and at such place or places as Secured Party may fix in the
      notice of such sale. Secured Party shall not be obligated to make any sale
      pursuant to any such notice. Secured Party may, without notice or
      publication, adjourn


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<PAGE>

      any public or private sale by announcement at any time and place fixed for
      such sale, and such sale may be made at any time or place to which the
      same may be so adjourned. In the event any sale or transfer hereunder is
      not completed or is defective in the opinion of Secured Party, such sale
      or transfer shall not exhaust the rights of Secured Party hereunder, and
      Secured Party shall have the right to cause one or more subsequent sales
      or transfers to be made hereunder. In the event that any of the Collateral
      is sold or transferred on credit, or to be held by Secured Party for
      future delivery to a purchaser or transferee, the Collateral so sold or
      transferred may be retained by Secured Party until the purchase price or
      other consideration is paid by the purchaser or transferee thereof, but in
      the event that such purchaser or transferee fails to pay for the
      Collateral so sold or transferred or to take delivery thereof, Secured
      Party shall incur no liability in connection therewith. If only part of
      the Collateral is sold or transferred such that the Liabilities remain
      outstanding (in whole or in part), Secured Party's rights and remedies
      hereunder shall not be exhausted, waived or modified, and Secured Party is
      specifically empowered to make one or more successive sales or transfers
      until all the Collateral shall be sold or transferred and all the
      Liabilities are paid. In the event that Secured Party elects not to sell
      the Collateral, Secured Party retains its rights to lease or otherwise
      dispose of or utilize the Collateral or any part or parts thereof in any
      manner authorized or permitted by law or in equity, and to apply the
      proceeds of the same towards payment of the Liabilities. Each and every
      method of disposition of the Collateral described in this Subsection
      7.1(d) shall constitute disposition in a commercially reasonable manner.

            (e) Take possession of all books and records of Debtor pertaining to
      the Collateral. Secured Party shall have the authority to enter upon any
      real property or improvements thereon in order to obtain any such books or
      records, or any Collateral located thereon, and remove the same therefrom
      without liability.

            (f) Apply proceeds of the disposition of Collateral to the
      Liabilities in any manner elected by Secured Party and permitted by the
      UCC or otherwise permitted by law or in equity. Such application may
      include the reasonable expenses of retaking, holding, preparing for sale
      or other disposition, and the reasonable attorneys' fees and legal


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<PAGE>

      expenses incurred by Secured Party. Any surplus of proceeds held by
      Secured Party after payment in full of all Liabilities shall be paid over
      to Debtor or to whomsoever may be lawfully entitled to receive such
      surplus.

            (g) Appoint any party as agent to perform any act or acts necessary
      or incident to any sale or transfer by Secured Party of the Collateral.
      Additionally, any sale or transfer hereunder may be conducted by an
      auctioneer or any officer or agent of Secured Party.

            (h) Subject to the provisions of Section 7.3(a) of the Loan
      Agreement and subject to the Multi-Party Agreement, apply and set-off (i)
      any deposits of Debtor held by Secured Party; (ii) all claims of Debtor
      against Secured Party, now or hereafter existing; (iii) any other
      property, rights or interests of Debtor which come into the possession or
      custody or under the control of Secured Party; and (iv) the proceeds of
      any of the foregoing as if the same were included in the Collateral.
      Secured Party agrees to notify Debtor promptly after any such set-off or
      application; provided, that the failure of Secured Party to give any such
      notice shall not affect the validity of such set-off or application. The
      rights of Secured Party under this Subsection 7.1(h) are in addition to
      any other rights and remedies, including any other rights of set-off.

            (i) Demand, collect, settle, compromise any amounts due, give
      acquittances for, prosecute or defend any action which may be in relation
      to any monies due or to become due by virtue of, the Accounts;

            (j) Sell, transfer or assign or otherwise deal in the Accounts or
      the proceeds thereof, as fully and effectively as if Secured Party were
      the absolute owner thereof;

            (k) Extend the time of payment of any of the Accounts, to grant
      waivers and make any allowance or other adjustment with reference thereto;
      and

            (l) Endorse the name of Debtor on notes, checks or other evidences
      of payments on Collateral that may come into possession of Secured Party
      and deliver the same to Document Agent.

      7.2 Settlement of Accounts. In the event that Secured Party exercises its
right to settle or adjust any disputes or 


                                       15
<PAGE>

claims with Account Debtors on behalf of Debtor for an amount less than the
original Account in dispute, Secured Party shall not be obligated to credit the
Liabilities in an amount in excess of the amount that Secured Party receives as
payment on such disputed Account. Any exercise by Secured Party of its rights in
and to the Accounts shall, as may be applicable, be a full and complete release,
discharge and acquittance of the Account Debtor with respect to such Account,
and Debtor shall take any action as may be reasonably required by Secured Party
in connection therewith.

      7.3 Servicing of SBA Loans. Upon the occurrence and during the continuance
of any Event of Default, subject to the provisions of the Multi-Party Agreement,
Secured Party, or its designee, may monitor, manage, and service any or all of
the Notes Receivable, including the Sold Notes Receivable, and Debtor's
relationship with the Term Loan Debtors and other customers of Debtor, on the
terms and conditions set forth in Section 7.3(d) of the Loan Agreement.

      7.4 Liability for Deficiency. If any action of Secured Party hereunder
results in a partial reduction of the Liabilities, such action shall not release
Debtor from its liability to Secured Party for any unpaid Liabilities, including
costs, charges and expenses incurred in the liquidation of Collateral, together
with interest thereon, and the same shall be immediately due and payable to
Secured Party at Secured Party's address set forth in the opening paragraph
hereof.

                                  ARTICLE VIII

                            MISCELLANEOUS PROVISIONS

      8.1 Notices. Except as otherwise provided herein, whenever this Agreement
provides that any notice, demand, request, consent, approval, declaration or
other communication shall or may be given to or served upon any of the parties
by another, or whenever any of the parties desires to give or serve upon another
any communication with respect to this Agreement, each such notice, demand,
request, consent, approval, declaration or other communication shall be in
writing and shall be delivered (a) in person with receipt acknowledged, or (b)
by facsimile with receipt confirmed, or (c) by registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:


                                       16
<PAGE>

            (a) If to Secured Party, at:

                        Transamerica Business Credit Corporation
                        8750 W. Bryn Mawr Avenue, Suite 720
                        Chicago Illinois  60631
                        Attention:  Account Executive - BLC
                        Facsimile:  (773) 380-6179

                        and

                        Transamerica Business Credit Corporation
                        9399 West Higgins Road, Suite 600
                        Rosemont, Illinois  60018
                        Attention:  Mary F. Krakowski, Esq.
                        Facsimile:  (847) 685-1142

                        With copies to:

                        Murphy, Weir & Butler
                        101 California Street, 39th Floor
                        San Francisco, California  94111
                        Attention:  Dick M. Okada, Esq.
                        Facsimile:  (415) 421-7879

            (b) If to Debtor, at:

                        Business Loan Center, Inc.
                        645 Madison Avenue, 18th Floor
                        New York, New York 10022
                        Attention:  Mr. Robert Tannenhauser
                                    President
                        Facsimile:  (212) 751-9345

                        With copies to:

                        Weil, Gotshal & Manges, LLP
                        767 Fifth Avenue, 31st Floor
                        New York, New York 10153
                        Attention: Simeon Gold, Esq.
                        Facsimile: (212) 310-8007

or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
consent, approval, declaration or other communication hereunder shall be deemed
to have been duly given or served on the date on which personally 


                                       17
<PAGE>

delivered or sent by facsimile, with receipt acknowledged or confirmed, or three
(3) Business Days after the same shall have been deposited in the United States
mail. Failure or delay in delivering copies of any notice, demand, request,
consent, approval, declaration or other communication to the persons designated
above to receive copies shall in no way adversely affect the effectiveness of
such notice, demand, request, consent, approval, declaration or other
communication.

      8.2 Amendments and Waivers. Secured Party's acceptance of partial or
delinquent payments or any forbearance, failure or delay by Secured Party in
exercising any right, power or remedy hereunder shall not be deemed a waiver of
any Obligation of Debtor, or of any right, power or remedy of Secured Party; and
no partial exercise of any right, power or remedy shall preclude any other or
further exercise thereof. Secured Party may remedy any default hereunder or in
connection with the Liabilities without waiving the default so remedied. Debtor
hereby agrees that if Secured Party agrees to a waiver of any provision
hereunder, or an exchange of or release of the Collateral, any such action shall
not constitute a waiver of any of Secured Party's other rights or of Debtor's
Liabilities hereunder. This Agreement represents the final Agreement between the
parties with respect to the subject matter hereof and may be amended only by an
instrument in writing executed jointly by Debtor and Secured Party and may be
supplemented only by documents delivered or to be delivered in accordance with
the express terms hereof.

      8.3 Subrogation. Until all Indebtedness in connection with the Liabilities
shall have been paid in full, Debtor shall have no right to subrogation or to
enforce any remedy or participate in any Collateral or security whatsoever now
or hereafter held by Secured Party.

      8.4 Continuing Security Agreement.

            (a) This Agreement shall constitute a continuing security agreement,
and all representations and warranties, covenants and agreements shall, as
applicable, apply to all future as well as existing transactions. Provisions of
this Agreement, unless by their terms exclusive, shall be in addition to other
agreements between the parties.

            (b) To the extent that any payments on the Liabilities or proceeds
of the Collateral are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee, debtor in
possession, receiver or 


                                       18
<PAGE>

other party under any bankruptcy law, common law or equitable cause, then to
such extent the Liabilities so satisfied shall be revived and continue as if
such payment or proceeds had not been received by Secured Party, and Secured
Party's security interests, rights, powers and remedies hereunder shall continue
in full force and effect.

            (c) In the event that the Liabilities are structured such that there
are times when no Indebtedness is owing thereunder, this Agreement shall remain
valid and in full force and effect as to all subsequent Indebtedness included in
the Liabilities, provided Secured Party has not in the interim period executed a
written release or termination statement or returned possession or reassigned
the Collateral to Debtor.

      8.5 Termination. When all Liabilities secured hereby shall have been paid
in full and Secured Party's obligation to make Revolving Loans has terminated,
this Agreement and the Liens created hereby shall terminate. Promptly
thereafter, Secured Party shall reassign and deliver to Debtor, without
recourse, all Collateral in its possession, and shall execute a written release
or termination statement.

      8.6 CONSTRUCTION. THIS AGREEMENT, THE LOAN AGREEMENT, THE REVOLVING CREDIT
NOTE, AND THE OTHER LOAN DOCUMENTS ARE CONTRACTS MADE UNDER AND SHALL, IN ALL
RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY, AND PERFORMANCE, AND
ALL CLAIMS AND CAUSES OF ACTION RELATED HERETO AND THERETO, WHETHER SOUNDING IN
CONTRACT OR IN TORT, BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
THE UNITED STATES OF AMERICA AND THE STATE OF ILLINOIS, AS SUCH LAWS ARE NOW IN
EFFECT (WITHOUT REGARD TO THE PRINCIPLES THEREOF REGARDING CONFLICTS OF LAWS)
AND, WITH RESPECT TO USURY LAWS, IF ANY, APPLICABLE TO SECURED PARTY AND TO THE
EXTENT ALLOWED THEREBY, AS SUCH LAWS MAY HEREAFTER BE IN EFFECT WHICH ALLOW A
HIGHER MAXIMUM NONUSURIOUS INTEREST RATE THAN SUCH LAWS NOW ALLOW; PROVIDED,
THAT IF ANY OF THE COLLATERAL SHALL BE LOCATED IN ANY JURISDICTION OTHER THAN
ILLINOIS, THE LAWS OF SUCH JURISDICTION SHALL GOVERN THE METHOD, MANNER AND
PROCEDURE FOR FORECLOSURE OF SECURED PARTY'S LIEN UPON SUCH COLLATERAL AND THE
ENFORCEMENT OF SECURED PARTY'S OTHER REMEDIES IN RESPECT OF SUCH COLLATERAL TO
THE EXTENT THAT THE LAWS OF SUCH JURISDICTION ARE DIFFERENT FROM OR INCONSISTENT
WITH THE LAWS OF ILLINOIS. IT IS THE INTENT OF ALL OF THE PARTIES HERETO THAT
THE LAWS OF THE STATE OF ILLINOIS SHALL GOVERN THIS AGREEMENT, THE REVOLVING
CREDIT NOTE, AND THE OTHER LOAN DOCUMENTS, AND THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY.


                                       19
<PAGE>

      8.7 WAIVER OF JURY TRIAL. BECAUSE DISPUTES ARISING IN CONNECTION WITH
COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN
EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL
LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR
DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO
ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF
ARBITRATION, DEBTOR AND SECURED PARTY HEREBY WAIVE, TO THE FULL EXTENT PERMITTED
BY APPLICABLE LAW, THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, THE REVOLVING CREDIT NOTE
OR THE LOAN AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT
MATTER OF THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY AND THE RELATIONSHIP
THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER IS INTENDED TO BE 
ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND
THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT
CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS. SECURED PARTY AND DEBTOR EACH ACKNOWLEDGE THAT THIS WAIVER IS
A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS
ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH
SHALL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. SECURED
PARTY AND DEBTOR FURTHER WARRANT AND REPRESENT THAT EACH HAS REVIEWED THIS
WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES
ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING,
AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS TO THIS AGREEMENT, THE LOAN AGREEMENT, THE REVOLVING CREDIT
NOTE, OR ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE REVOLVING LOANS. IN
THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A
TRIAL BY THE COURT.

      8.8 Successors and Assigns. This Agreement shall be binding on Debtor,
Debtor's successors and assigns, and inure to the benefit of Secured Party and
its successors and assigns. Debtor shall not assign this Agreement or any rights
or obligations hereunder without the prior written consent of Secured Party.

      8.9 Conflict with Multi-Party Agreement. In the event any provision of
this Agreement conflicts or is inconsistent with the Multi-Party Agreement, as
amended from time to time, the relevant provisions of the Multi-Party Agreement
shall be controlling.


                                       20
<PAGE>

      8.10 Severability. In the event that any one or more of the provisions
contained in this Agreement shall, for any reason, be held invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement.

      8.11 Counterparts. This Agreement may be executed in counterparts and it
shall not be necessary that the signatures of all parties hereto be contained on
any one counterpart hereof; each counterpart shall be deemed as original, but
all of such counterparts together shall constitute one and the same instrument.

            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first written above.

                                    DEBTOR:

                                    BUSINESS LOAN CENTER, INC.,
                                    a Delaware corporation

                                    By:
                                       --------------------------------
                                          Robert F. Tannenhauser
                                          President


                                    SECURED PARTY:

                                    TRANSAMERICA BUSINESS CREDIT
                                    CORPORATION, a Delaware corporation

                                    By:
                                       --------------------------------
                                          Ari D. Kaplan
                                          Senior Account Executive


                                       21
<PAGE>

                          ACKNOWLEDGMENT OF INSTRUMENTS

STATE OF __________________________ )
                                    )     SS.
COUNTY OF _________________________ )

      On __________________________ before me, the undersigned notary public in
and for said state, personally appeared ________________________, personally
known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument, the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.

      WITNESS my hand and official seal.

Signature                                             (Seal)
          --------------------------------
<PAGE>

                          ACKNOWLEDGMENT OF INSTRUMENTS

STATE OF __________________________ )
                                    )     SS.
COUNTY OF _________________________ )

      On __________________________ before me, the undersigned notary public in
and for said state, personally appeared ________________________, personally
known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument, the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.

      WITNESS my hand and official seal.

Signature                                             (Seal)
          -------------------------------