Document:

<PAGE>

                                                                     EXHIBIT 4.1

                                                                  EXECUTION COPY

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

[JPMORGAN LOGO]

                                  $208,500,000
                                CREDIT AGREEMENT

                                   dated as of

                                 March 31, 2003

                                      among

                                 TBC CORPORATION

                            The Lenders Party Hereto,

                         U.S. BANK NATIONAL ASSOCIATION
                             as Documentation Agent,

                                  SUNTRUST BANK
                              as Syndication Agent,

                    FIRST TENNESSEE BANK NATIONAL ASSOCIATION
                             as Administrative Agent

                                       and

                               JPMORGAN CHASE BANK
                           as Co-Administrative Agent

                         ------------------------------

                           J.P. MORGAN SECURITIES INC.
                  as Sole Advisor, Lead Arranger and Bookrunner

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

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                     PAGE
<S>                                                                                                                  <C>
ARTICLE I Definitions............................................................................................       1

         SECTION 1.01.   Defined Terms...........................................................................       1
         SECTION 1.02.   Classification of Loans and Borrowings..................................................      20
         SECTION 1.03.   Terms Generally.........................................................................      21
         SECTION 1.04.   Accounting Terms; GAAP..................................................................      21

ARTICLE II The Credits...........................................................................................      21

         SECTION 2.01.   Revolving and Term Loan Commitments.....................................................      21
         SECTION 2.02.   Loans and Borrowings....................................................................      22
         SECTION 2.03.   Requests for Borrowings.................................................................      23
         SECTION 2.04.   Swingline Loans.........................................................................      25
         SECTION 2.05.   Letters of Credit.......................................................................      26
         SECTION 2.06.   Funding of Borrowings...................................................................      30
         SECTION 2.07.   Interest Elections......................................................................      31
         SECTION 2.08.   Termination and Reduction of Revolving Credit Commitments...............................      32
         SECTION 2.09.   Repayment of Loans; Evidence of Debt....................................................      32
         SECTION 2.10.   Prepayment of Loans.....................................................................      35
         SECTION 2.11.   Fees....................................................................................      36
         SECTION 2.12.   Interest................................................................................      37
         SECTION 2.13.   Alternate Rate of Interest..............................................................      38
         SECTION 2.14.   Increased Costs.........................................................................      39
         SECTION 2.15.   Break Funding Payments..................................................................      40
         SECTION 2.16.   Taxes...................................................................................      40
         SECTION 2.17.   Payments Generally; Pro Rata Treatment; Sharing of Set-offs.............................      41
         SECTION 2.18.   Mitigation Obligations; Replacement of Lenders..........................................      43

ARTICLE III Representations and Warranties.......................................................................      44

         SECTION 3.01.   Organization; Powers....................................................................      44
         SECTION 3.02.   Authorization; Enforceability...........................................................      44
         SECTION 3.03.   Governmental Approvals; No Conflicts....................................................      44
         SECTION 3.04.   Financial Condition; No Material Adverse Change.........................................      44
         SECTION 3.05.   Properties..............................................................................      45
         SECTION 3.06.   Litigation and Environmental Matters....................................................      45
</TABLE>

                                       i

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<TABLE>
<CAPTION>
                                                                                                                     PAGE
<S>                                                                                                                  <C>
         SECTION 3.07.   Compliance with Laws and Agreements.....................................................      46
         SECTION 3.08.   Investment and Holding Company Status...................................................      46
         SECTION 3.09.   Taxes...................................................................................      46
         SECTION 3.10.   ERISA...................................................................................      46
         SECTION 3.11.   Disclosure..............................................................................      47
         SECTION 3.12.   Margin Stock............................................................................      47
         SECTION 3.13.   Compliance with Conditions Precedent....................................................      47
         SECTION 3.14.   Labor Matters...........................................................................      47
         SECTION 3.15.   Assets..................................................................................      47
         SECTION 3.16.   Security Documents......................................................................      47
         SECTION 3.17.   Solvency................................................................................      48
         SECTION 3.18.   Certain Documents.......................................................................      48
         SECTION 3.19.   Regulation H............................................................................      48

ARTICLE IV Conditions............................................................................................      48

         SECTION 4.01.   Effective Date..........................................................................      48
         SECTION 4.02.   Each Credit Event.......................................................................      50

ARTICLE V Affirmative Covenants..................................................................................      51

         SECTION 5.01.   Punctual Payment........................................................................      51
         SECTION 5.02.   Financial Statements and Other Information..............................................      51
         SECTION 5.03.   Notices of Material Events..............................................................      52
         SECTION 5.04.   Existence; Conduct of Business..........................................................      52
         SECTION 5.05.   Payment of Obligations..................................................................      53
         SECTION 5.06.   Maintenance of Properties; Insurance....................................................      53
         SECTION 5.07.   Books and Records; Inspection Rights....................................................      53
         SECTION 5.08.   Compliance with Laws....................................................................      53
         SECTION 5.09.   Use of Proceeds.........................................................................      53
         SECTION 5.10.   Intercompany Loans/Payments.............................................................      53
         SECTION 5.11.   Subsidiary Guarantees and Collateral....................................................      54
         SECTION 5.12.   Environmental Laws......................................................................      54
         SECTION 5.13.   Additional Collateral, etc..............................................................      55
         SECTION 5.14.   Title Insurance, etc....................................................................      55

ARTICLE VI Negative Covenants....................................................................................      57

         SECTION 6.01.   Indebtedness............................................................................      57
         SECTION 6.02.   Liens...................................................................................      58
         SECTION 6.03.   Fundamental Changes.....................................................................      59
</TABLE>

                                       ii

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<TABLE>
<CAPTION>
                                                                                                                     PAGE
<S>                                                                                                                  <C>
         SECTION 6.04.   Investments, Loans, Advances, Guarantees and Acquisitions...............................      59
         SECTION 6.05.   Hedging Agreements......................................................................      61
         SECTION 6.06.   Transactions with Affiliates............................................................      61
         SECTION 6.07.   Restrictive Agreements..................................................................      61
         SECTION 6.08.   Fixed Charge Coverage Ratio.............................................................      62
         SECTION 6.09.   Maximum Leverage Ratio..................................................................      62
         SECTION 6.10.   Adjusted Debt to EBITDAR................................................................      63
         SECTION 6.11.   Asset Test..............................................................................      64
         SECTION 6.12.   Disclosure..............................................................................      64
         SECTION 6.13.   Sale of Assets..........................................................................      64
         SECTION 6.14.   Restricted Payments.....................................................................      64

ARTICLE VII Events of Default....................................................................................      65

ARTICLE VIII The Administrative Agent and the Co-Administrative Agent............................................      67

ARTICLE IX Miscellaneous.........................................................................................      70

         SECTION 9.01.   Notices.................................................................................      70
         SECTION 9.02.   Waivers; Amendments.....................................................................      70
         SECTION 9.03.   Expenses; Indemnity; Damage Waiver......................................................      72
         SECTION 9.04.   Successors and Assigns; Participations and Assignments..................................      73
         SECTION 9.05.   Survival................................................................................      76
         SECTION 9.06.   Counterparts; Integration; Effectiveness................................................      76
         SECTION 9.07.   Severability............................................................................      77
         SECTION 9.08.   Right of Setoff.........................................................................      77
         SECTION 9.09.   Governing Law, Jurisdiction; Consent to Service of Process..............................      77
         SECTION 9.10.   WAIVER OF JURY TRIAL....................................................................      78
         SECTION 9.11.   Headings................................................................................      78
         SECTION 9.12.   Confidentiality.........................................................................      78
         SECTION 9.13.   Interest Rate Limitation................................................................      79
</TABLE>

<TABLE>
<S>                   <C>                                                                                            <C>
Schedule 1.01A        FORM OF ASSIGNMENT AND ACCEPTANCE..........................................................
Schedule 1.01B        FORM OF INCREMENTAL FACILITY ACTIVATION NOTICE.............................................
Schedule 1.01C        EXISTING LETTERS OF CREDIT.................................................................
Schedule 2.01         COMMITMENTS................................................................................
Schedule 2.02         FORM OF NEW LENDER SUPPLEMENT..............................................................
Schedule 3.01         BORROWER AND SUBSIDIARIES AND JURISDICTIONS OF
                         ORGANIZATION............................................................................
</TABLE>

                                       iii

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<TABLE>
<CAPTION>
                                                                                                                     PAGE
<S>                   <C>                                                                                            <C>
Schedule 3.15         TRADEMARKS, TRADENAMES AND SERVICE MARKS...................................................
Schedule 3.16(a)      UCC FILING JURISDICTIONS...................................................................
Schedule 3.16(b)      MORTGAGE FILING JURISDICTIONS..............................................................
Schedule 4.01(b)      FORM OF OPINION LETTER.....................................................................
Schedule 4.01(f)      FORM OF GUARANTEE AND COLLATERAL AGREEMENT.................................................
Schedule 5.10         CERTAIN INTERCOMPANY LOANS.................................................................
Schedule 6.01         EXISTING INDEBTEDNESS......................................................................
Schedule 6.01(e)      GUARANTEE OBLIGATIONS OF BIG O TIRES, INC. AND SUBSIDIARIES................................
Schedule 6.02         EXISTING LIENS.............................................................................
Schedule 6.03(a)      DISPOSITION OF PROPERTY OF BIG O TIRES, INC. OR BIG
                      O RETAIL ENTERPRISES.......................................................................
Schedule 6.04(b)      CERTAIN EXISTING INVESTMENTS AND LOANS.....................................................
Schedule 6.07         EXISTING RESTRICTIONS......................................................................
Schedule 6.13         CERTAIN ASSET SALES........................................................................
</TABLE>

                                       iv

<PAGE>

                                CREDIT AGREEMENT

                  THIS CREDIT AGREEMENT, dated as of March 31, 2003, is among
TBC Corporation, a Delaware corporation with its principal office located at
4770 Hickory Hill Road, Memphis, Tennessee 38141 (the "Borrower"), the Lenders
signatory to this Agreement (each a "Lender"), First Tennessee Bank National
Association, a banking corporation with its principal office located at 165
Madison Avenue, Memphis, Tennessee 38103, as administrative agent for the
Lenders (in such capacity, the "Administrative Agent") and JPMorgan Chase Bank,
a banking corporation with an office located at 270 Park Avenue, New York, New
York 10017, as co-administrative agent for the Lenders (in such capacity the
"Co-Administrative Agent").

                                    RECITALS

                  WHEREAS, the Borrower is a party to an existing $160,000,000
amended and restated credit agreement (as amended from time to time, the
"Existing Credit Agreement"), dated as of January 5, 2001 among the Borrower,
certain of its subsidiaries, as guarantors, various lenders and the agents named
therein;

                  WHEREAS, the Borrower intends to refinance, terminate and
replace the Existing Credit Agreement (the "Refinancing"); and

                  WHEREAS, to facilitate the Refinancing, and to finance the
acquisition of Merchant's, Incorporated and its subsidiary (the "Merchant's
Acquisition"), the Borrower's working capital needs, capital expenditures,
further acquisitions and for all other general corporate purposes, the Borrower
wishes to establish with the Lenders credit facilities providing for term loans,
revolving loans, letters of credit and swingline loans of up to $208,500,000 in
the aggregate maximum principal amount at any time outstanding, and the Lenders
and the Administrative Agent are willing to establish such credit facilities on
the terms and conditions set forth herein;

                  NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the parties hereto,
such parties hereby agree as follows:

                                    ARTICLE I

                                   Definitions

                  SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms have the meanings specified below:

                  "ABR", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.

                  "Acceptable Acquisition" has the meaning set forth in Section
6.04.

<PAGE>

                                                                               2

                  "Additional Prudential Notes" means the Senior Notes the
Borrower issued and Prudential purchased pursuant to the Note Agreement to be
dated as of April 1, 2003 between the Borrower and Prudential and its
affiliates.

                  "Adjusted LIBO Rate" means, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such
Interest Period multiplied by (b) the Statutory Reserve Rate.

                  "Administrative Agent" means First Tennessee Bank National
Association, in its capacity as administrative agent for the Lenders hereunder.

                  "Administrative Questionnaire" means an Administrative
Questionnaire in a form supplied by the Administrative Agent.

                  "Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.

                  "Alternate Base Rate" means, for any day, a rate per annum
equal to the highest of (a) the Prime Rate in effect on such day, and (b) the
Federal Funds Effective Rate in effect on such day plus 0.5%. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective as of the opening of business on the effective
day of such change in the Prime Rate, or the Federal Funds Effective Rate,
respectively.

                  "Applicable Percentage" means, with respect to any Lender, at
any time, the percentage of the total Revolving Credit Commitments represented
by such Lender's Revolving Credit Commitment at such time. If the Revolving
Credit Commitments have terminated or expired, the Applicable Percentages shall
be determined based upon the principal amount of all Revolving Loans
outstanding, giving effect to any assignments and any increase pursuant to
Section 2.02(d).

                  "Applicable Rate" means, for any day, with respect to any ABR
Loan or Eurodollar Loan, or with respect to the commitment fees payable
hereunder, as the case may be, the applicable rate per annum, stated in basis
points, set forth below under the caption "ABR Spread", "Eurodollar Spread" or
"Commitment Fee Rate", as the case may be, based upon the Leverage Ratio as in
effect on such date:

<TABLE>
<CAPTION>
=========================================================================================================
                                                                                               Commitment
Leverage Ratio:                     ABR Spread                Eurodollar Spread                 Fee Rate
---------------------------------------------------------------------------------------------------------
<S>                                 <C>                       <C>                              <C>
  Category 1
     >3.00                             175.0                         275.0                         50.00
---------------------------------------------------------------------------------------------------------
  Category 2
  >=2.50 but
    <=3.00                             150.0                         250.0                         37.50
---------------------------------------------------------------------------------------------------------
  Category 3                           125.0                         225.0                         37.50
---------------------------------------------------------------------------------------------------------
</TABLE>

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                                                                               3

<TABLE>
<CAPTION>

=========================================================================================================
                                                                                               Commitment
Leverage Ratio:                     ABR Spread                Eurodollar Spread                 Fee Rate
---------------------------------------------------------------------------------------------------------
<S>                                 <C>                       <C>                              <C>
  >=2.00 but
    <2.50
---------------------------------------------------------------------------------------------------------
  Category 4
 >= 1.50 but
  <2.00                               100.0                           200.0                        30.00
---------------------------------------------------------------------------------------------------------
  Category 5
    <1.50                              75.0                           175.0                        25.00
=========================================================================================================
</TABLE>

                  For purposes of the foregoing, the Leverage Ratio shall be
determined and adjusted on the first day of the month after the month in which
the Borrower provides the Financial Officer's certificate in accordance with the
provisions of Section 5.02(c) (each a "Ratio Calculation Date"). The initial
Applicable Rate shall be 150 basis points for ABR Loans and 250 basis points for
Eurodollar Borrowings, and shall not be less than such rate until the first
Ratio Calculation Date subsequent to September 30, 2003. If the Borrower fails
to provide a Financial Officer's certificate required by Section 5.02(c) on or
before the date required pursuant to such Section, the Applicable Rate shall be
based on Category 1 from such date until such time that an appropriate Financial
Officer's certificate is provided, whereupon the Applicable Rate shall then be
determined by the Leverage Ratio reflected on such Financial Officer's
certificate, until the next Ratio Calculation Date. Subject to the preceding
sentence, each determination of the Applicable Rate shall be effective from one
Ratio Calculation Date until the next Ratio Calculation Date. Any adjustment in
the Applicable Rate shall be applicable to all existing Loans as well as any new
Loans made, as long as the adjusted Applicable Rate remains in effect. For
purposes of the foregoing table:

                  < means less than

                  <= means less than or equal to

                  > means greater than

                  >= means equal to or greater than.

                  "Approved Fund" has the meaning assigned to such term in
Section 9.04(b).

                  "Arranger" means J. P. Morgan Securities Inc. in its capacity
as arranger of the Commitments.

                  "Assignee" has the meaning assigned to such term in Section
9.04(b).

                  "Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative Agent,
in the form of Schedule 1.01A or any other form approved by the Administrative
Agent.

<PAGE>

                                                                               4

                  "Availability Period" means the period from and including the
Effective Date to but excluding the earlier of the Revolving Credit Maturity
Date or the date of termination of the Revolving Credit Commitments.

                  "Available Revolving Credit Commitment" means, with respect to
each Lender, at any time, the amount of its Revolving Credit Commitment minus
its Revolving Credit Exposure, at such time.

                  "Available Tranche B Term Commitment" means, with respect to
each Lender, at any time, the amount of its Tranche B Term Commitment minus its
Tranche B Term Exposure, at such time.

                  "Board" means the Board of Governors of the Federal Reserve
System of the United States of America.

                  "Borrower" has the meaning set forth in the introductory
paragraph of this Agreement.

                  "Borrowing" means (a) Loans that are of the same Class and
Type, that are made, converted or continued on the same date and, in the case of
Eurodollar Loans, as to which a single Interest Period is in effect or (b) a
Swingline Loan.

                  "Borrowing Request" means a request by the Borrower for a
Revolving Borrowing or a Tranche B Borrowing, as the case may be, in accordance
with Section 2.03.

                  "Business Day" means any day that is not a Saturday, Sunday or
other day on which commercial banks in Memphis, Tennessee are authorized or
required by law to remain closed; provided that, when used in connection with a
Eurodollar Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.

                  "Capital Expenditures" mean, for any period, expenditures
(including the aggregate amount of Capital Lease Obligations incurred during
such period) made directly or indirectly by the Borrower or any Subsidiary to
acquire or construct fixed assets, property, plant and equipment (including
renewals, improvements, replacements and substitutions, but excluding repairs)
during such period, computed in accordance with GAAP.

                  "Capital Lease Obligations" of any Person means the
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.

                  "Change in Control" means (a) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or group
(within the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder as in effect on the date hereof)
of shares representing more than 20% of the aggregate ordinary voting

<PAGE>

                                                                               5

power represented by the issued and outstanding capital stock of the Borrower;
(b) occupation of a majority of the seats (other than vacant seats) on the board
of directors of the Borrower by Persons who were neither (i) nominated by the
board of directors of the Borrower nor (ii) appointed by directors so nominated;
or (c) the acquisition of direct or indirect Control of the Borrower by any
Person or group.

                  "Change in Law" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender (or,
for purposes of Section 2.14(b), by any lending office of such Lender or by such
Lender's holding company, if any) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or
issued after the date of this Agreement.

                  "Class", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
Revolving Loans, Term Loans or Swingline Loans.

                  "Co-Administrative Agent" means JPMorgan Chase Bank in its
capacity as co-administrative agent for the Lenders hereunder.

                  "Code" means the Internal Revenue Code of 1986, as amended
from time to time.

                  "Commitment" means, with respect to each Lender, the
commitment of such Lender to make Loans of a given Class, and to acquire
participations in Letters of Credit and Swingline Loans, hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.08 and (b)
reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04. The initial amount of each Lender's Commitment
to make Loans of a given Class is set forth on Schedule 2.01, or in the
Assignment and Acceptance pursuant to which such Lender shall have assumed its
Commitment, as applicable. The initial aggregate amount of the Lenders'
Commitments is $208,500,000.

                  "Conduit Lender" means any special purpose corporation
organized and administered by any Lender for the purpose of making Loans
otherwise required to be made by such Lender and designated by such Lender in a
written instrument; provided, that the designation by any Lender of a Conduit
Lender shall not relieve the designating Lender of any of its obligations to
fund a Loan under this Agreement if, for any reason, its Conduit Lender fails to
fund any such Loan, and the designating Lender (and not the Conduit Lender)
shall have the sole right and responsibility to deliver all consents and waivers
required or requested under this Agreement with respect to its Conduit Lender,
and provided, further, that no Conduit Lender shall (a) be entitled to receive
any greater amount pursuant to Section 2.14, 2.15, 2.16 or 9.03 than the
designating Lender would have been entitled to receive in respect of the
extensions of credit made by such Conduit Lender or (b) be deemed to have any
Commitment.

                  "Consolidated Funded Indebtedness" means all Funded
Indebtedness of the Borrower and its Subsidiaries after eliminating
inter-company items, including any Funded

<PAGE>

                                                                               6

Indebtedness outstanding pursuant to and under this Agreement, in each case
determined on a consolidated basis in accordance with GAAP.

                  "Consolidated Interest Expense" means for any period for which
such amount is being determined, the interest expense of the Borrower and the
Consolidated Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP, including (i) the amortization of debt discounts to the
extent included in interest expense in accordance with GAAP, (ii) the
amortization of all fees (including fees with respect to Hedging Agreements)
payable in connection with the incurrence of Indebtedness to the extent included
in interest expense in accordance with GAAP and (iii) the portion of any rents
payable under Capital Lease Obligations allocable to interest expense in
accordance with GAAP.

                  "Consolidated Net Income" means the net income of the Borrower
and its Consolidated Subsidiaries, after taxes and after extraordinary items as
determined on a consolidated basis in accordance with GAAP.

                  "Consolidated Subsidiaries" means Subsidiaries whose accounts
are consolidated with the accounts of the Borrower in the Borrower's
consolidated financial statements prepared in accordance with GAAP.

                  "Consolidated Total Liabilities" means, at any date the
consolidated total liabilities of the Borrower and its Subsidiaries at such date
determined in accordance with GAAP.

                  "Control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "Controlling" and "Controlled" have meanings correlative thereto.

                  "Default" means any event or condition which constitutes an
Event of Default or which solely upon notice, lapse of time or both would,
unless cured or waived, become an Event of Default.

                  "dollars" or "$" refers to lawful money of the United States
of America.

                  "EBITDA" means the sum of the following items measured for
each Fiscal Quarter:

                  (i)      Consolidated Net Income, plus

                  (ii)     depreciation, amortization, and all other non-cash
                           charges, plus

                  (iii)    income taxes to the extent they reduce Consolidated
                           Net Income, plus

                  (iv)     Consolidated Interest Expense.

In addition, (a) EBITDA shall include, on a pro forma basis for each Fiscal
Quarter (including any pro forma cost savings to the extent the same could be
reflected in pro forma financial statements contained in filings with the
Securities and Exchange Commission pursuant to its Regulation S-X), the
foregoing information with respect to each Person that was either acquired in an
Acceptable Acquisition or disposed of as permitted by this Agreement during such
Fiscal

<PAGE>

                                                                               7

Quarter, determined as if the Acquisition or disposition had taken place on the
first day of such Fiscal Quarter; and (b) whenever in this Agreement EBITDA is
determined for a period of four Fiscal Quarters, it shall include, on a pro
forma basis for such period (including any pro forma cost savings), the
foregoing information with respect to each Person that was either acquired in an
Acceptable Acquisition or disposed of as permitted by this Agreement during such
period, determined as if the Acquisition or disposition had taken place on the
first day of such four Fiscal Quarter period.

                  "Effective Date" means the date on which the conditions
specified in Section 4.01 are satisfied (or waived in accordance with Section
9.02).

                  "Environmental Laws" means all laws, rules, regulations,
codes, ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.

                  "Environmental Liability" means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary
directly or indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, transportation, storage,
treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous
Materials, (d) the release or threatened release of any Hazardous Materials into
the environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

                  "ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time.

                  "ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

                  "ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b) the
existence with respect to any Plan of an "accumulated funding deficiency" (as
defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower

<PAGE>

                                                                               8

or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal
Liability or a determination that a Multiemployer Plan is, or is expected to be,
insolvent or in reorganization, within the meaning of Title IV of ERISA.
Notwithstanding the foregoing, the Borrower's termination of the TBC Corporation
Retirement Plan, and the Borrower's incurrence of liability under Title IV of
ERISA with respect to such termination, shall not constitute an ERISA Event if,
after giving effect to the termination and any liability incurred by the
Borrower in connection therewith, the Borrower remains in compliance with the
financial covenants set forth in Sections 6.08 through 6.11, inclusive.

                  "Eurodollar", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.

                  "Event of Default" has the meaning assigned to such term in
Article VII.

                  "Excluded Foreign Subsidiary" means any Foreign Subsidiary in
respect of which either (a) the pledge of all of the Capital Stock of such
Subsidiary as Collateral or (b) the guaranteeing by such Subsidiary of the
Obligations, would, in the good faith judgment of the Borrower, result in
adverse tax consequences to the Borrower.

                  "Excluded Taxes" means, with respect to the Administrative
Agent, any Lender, the Issuing Bank or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.18(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender's failure to comply with Section 2.16(e), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.16(a).

                  "Existing Credit Agreement" has the meaning assigned thereto
in the recitals hereto.

                  "Existing Letters of Credit" means any letter of credit listed
on Schedule 1.01C.

                  "Existing Note Agreement" has the meaning assigned thereto in
the definition of "Prudential Debt".

                  "Facility Obligations" means, in each case, whether now in
existence or hereafter arising, (i) the principal of, and interest and premium,
if any, on, the Loans; (ii) the LC Exposure; and (iii) all other Indebtedness,
covenants, duties and obligations (including contingent obligations) now or at
any time or times hereafter owing by Borrower to Administrative Agent,

<PAGE>

                                                                               9

the Co-Administrative Agent or any Lender under or pursuant to this Agreement or
any of the other Loan Documents, whether evidenced by any note or other writing,
whether arising from any extension of credit, opening of a Letter of Credit,
acceptance, loan, Guarantee, indemnification or otherwise and whether direct or
indirect, absolute or contingent, due or to become due, primary or secondary, or
joint or several, including all interest, charges, expenses, fees or other sums
chargeable to Borrower or any Guarantor under this Agreement or under any of the
other Loan Documents.

                  "Federal Funds Effective Rate" means, for any day, the
weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for
such day for such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by it.

                  "Financial Officer" means the chief financial officer,
principal accounting officer, treasurer, assistant treasurer (to the extent
authorized to act) or controller of the Borrower.

                  "Fiscal Quarter" means each fiscal quarter-year period of the
Borrower, ending on the last day of each March, June, September and December.

                  "Fiscal Year" means the fiscal year of the Borrower, which is
the calendar year.

                  "Foreign Lender" means any Lender that is organized under the
laws of a jurisdiction other than that in which the Borrower is located. For
purposes of this definition, the United States of America, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.

                  "Funded Indebtedness" means any outstanding Indebtedness of a
Person for borrowed money, including all such Indebtedness of the Person to the
Lenders and other financial institutions, domestic or foreign, and all secured
and unsecured notes payable, all industrial revenue bonds, all Capital Lease
Obligations and other similar debt obligations and the current maturities
thereof, but excluding all Guarantees of Funded Indebtedness. (Checks that have
not been presented for payment shall not constitute Funded Indebtedness.)

                  "GAAP" means generally accepted accounting principles in the
United States of America.

                  "Governmental Authority" means the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.

                  "Grantors" means the Borrower and its Subsidiaries that are
parties to the Guarantee and Collateral Agreement.

<PAGE>

                                                                              10

                  "Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.

                  "Guarantee and Collateral Agreement" means the Guarantee and
Collateral Agreement to be executed and delivered by the Borrower and each
Grantor, substantially in the form of Schedule 4.01(f).

                  "Guarantor" means a Person liable pursuant to a Guarantee of
any of the Facility Obligations, which Guarantee is in form satisfactory to the
Required Lenders (the Guarantee and Collateral Agreement being in such a form).

                  "Hazardous Materials" means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.

                  "Hedging Agreement" means any interest rate protection
agreement, foreign currency exchange agreement, commodity price protection
agreement or other interest or currency exchange rate or commodity price hedging
arrangement.

                  "Incremental Facility Activation Notice" means a notice
substantially in the form of Schedule 1.01B.

                  "Incremental Facility Closing Date" means any Business Day
designated as such in an Incremental Facility Activation Notice.

                  "Indebtedness" of any Person means, without duplication, (a)
all obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such

<PAGE>

                                                                              11

Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty, (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances, and
(k) all obligations of such Person related to Synthetic Leases. The Indebtedness
of any Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such Person
is liable therefor as a result of such Person's ownership interest in or other
relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor.

                  "Indemnified Taxes" means Taxes other than Excluded Taxes.

                  "Information Memorandum" means the Confidential Information
Memorandum dated February 2003 relating to the Borrower and the Transactions.

                  "Intercompany Loan" means any Indebtedness for borrowed money
loaned by the Borrower to any of its Wholly-Owned Subsidiaries, by any
Wholly-Owed Subsidiary to the Borrower or by any Wholly-Owned Subsidiary to
another Wholly-Owned Subsidiary.

                  "Intercreditor Agreement" means the Intercreditor Agreement
among Prudential, each Lender, the Administrative Agent, the Co-Administrative
Agent and the Collateral Agent, dated as of March 31, 2003.

                  "Interest Election Request" means a request by the Borrower to
convert or continue a Borrowing in accordance with Section 2.07.

                  "Interest Payment Date" means (a) with respect to any ABR Loan
and Swingline Loan, the last day of each March, June, September and December and
(b) with respect to any Eurodollar Loan, the last day of the Interest Period
applicable to the Borrowing of which such Loan is a part and, in the case of a
Eurodollar Borrowing with an Interest Period of more than three months'
duration, each day prior to the last day of such Interest Period that occurs at
intervals of three months' duration after the first day of such Interest Period.

                  "Interest Period" means with respect to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months thereafter, as the Borrower may elect; provided, that (i) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day, unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

<PAGE>
                            COPYRIGHT REGISTRATIONS
<TABLE>
<CAPTION>

Title of Work                            Copyright Reg. No.                     Reg. Date
-------------                            -----------------                      ---------
<S>                                      <C>                                    <C>

TBC Corporation                             TX-2-920-912                        09/21/90
Electronic Ordering System

Info-Net User's Guide                       TX-4-135-989                        11/13/95
(Info-Net Online; Direct
Connection Info-Net)

Info-Net Online, Release 4.1                TX-4-168-625                        12/07/95
(Info-Net Online; Direct
Connection Info-Net)

Electronic Ordering System                  TX-4-212-078                       12/07/95
Release 1.0

</TABLE>

<PAGE>

                                                                      Annex 1 to
                                              Guarantee and Collateral Agreement

      ASSUMPTION AGREEMENT, dated as of ________________, 200_, made by
______________________________ (the "Additional Grantor"), in favor of JPMorgan
Chase Bank, as collateral agent (in such capacity, the "Collateral Agent") for
the banks and other financial institutions or entities (the "Lenders") parties
to the Credit Agreement referred to below and The Prudential Insurance Company
of America ("Prudential") and its affiliates (the "Prudential Affiliates") party
to the Note Agreements referred to below (the Lenders, Prudential and the
Prudential Affiliates collectively referred to as the "Secured Parties"). All
capitalized terms not defined herein shall have the meaning ascribed to them in
such Credit Agreement.

                              W I T N E S S E T H :

      WHEREAS, TBC Corporation (the "Borrower"), the Lenders, the Administrative
Agent and the Co-Administrative Agent have entered into a Credit Agreement,
dated as of March 31, 2003 (as amended, supplemented or otherwise modified from
time to time, the "Credit Agreement");

      WHEREAS, the Borrower and Prudential have entered into the Amended and
Restated Note Agreement, dated as of April 1, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Existing Note Agreement") and the
Borrower, Prudential and the Prudential Affiliates have entered into the Note
Purchase Agreement, dated as of April 1, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Additional Note Agreement") (the
Existing Note Agreement and the Additional Note Agreement collectively referred
to as "Note Agreements");

      WHEREAS, in connection with the Credit Agreement and the Note Agreements,
the Borrower and certain of its Affiliates (other than the Additional Grantor)
have entered into the Guarantee and Collateral Agreement, dated as of March 31,
2003 (as amended, supplemented or otherwise modified from time to time, the
"Guarantee and Collateral Agreement") in favor of the Collateral Agent for the
benefit of the Secured Parties;

      WHEREAS, the Credit Agreement and the Note Agreements require the
Additional Grantor to become a party to the Guarantee and Collateral Agreement;
and

      WHEREAS, the Additional Grantor has agreed to execute and deliver this
Assumption Agreement in order to become a party to the Guarantee and Collateral
Agreement;

      NOW, THEREFORE, IT IS AGREED:

      1. Guarantee and Collateral Agreement. By executing and delivering this
Assumption Agreement, the Additional Grantor, as provided in Section 8.14 of the
Guarantee and Collateral Agreement, hereby becomes a party to the Guarantee and
Collateral Agreement as a Grantor thereunder with the same force and effect as
if originally named therein as a Grantor and, without limiting the generality of
the foregoing, hereby expressly assumes all obligations

<PAGE>

and liabilities of a Grantor thereunder. The information set forth in Annex 1-A
hereto is hereby added to the information set forth in the Schedules to the
Guarantee and Collateral Agreement. The Additional Grantor hereby represents and
warrants that each of the representations and warranties contained in Section 4
of the Guarantee and Collateral Agreement is true and correct on and as the date
hereof (after giving effect to this Assumption Agreement) as if made on and as
of such date.

      2. GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

      IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement
to be duly executed and delivered as of the date first above written.

                                                    [ADDITIONAL GRANTOR]

                                                    By:
                                                       -------------------------
                                                       Name:
                                                       Title:

<PAGE>

                                                                    Annex 1-A to
                                                            Assumption Agreement

                            Supplement to Schedule 1

                            Supplement to Schedule 2

                            Supplement to Schedule 3

                            Supplement to Schedule 4

<PAGE>

                                                                   SCHEDULE 5.10

                           CERTAIN INTERCOMPANY LOANS

Provided that no Event of Default has occurred and is continuing, payments on
Intercompany Loans owed to Borrower by the following Subsidiaries may be made
without regard to the financial condition or solvency of the Subsidiary:

                           Northern States Tire, Inc.
                             Big O Development, Inc.

<PAGE>

                                                                   SCHEDULE 6.01

                              EXISTING INDEBTEDNESS

The Prudential Debt and the Additional Prudential Notes.

Those Guarantees listed on Schedule 6.01(e).

TBC Corporation has guaranteed a $1,500,000 line of credit made available to TBC
de Mexico and TBC International Inc. by First Tennessee Bank National
Association.

TBC Corporation has guaranteed all obligations of Big O Retail Enterprises,
Inc., Tire Kingdom, Inc., Big O Tires, Inc., and Carroll's, Inc., and (after the
closing date of the Merchant's Acquisition) expects to guarantee all obligations
of Merchant's Incorporated, to Michelin North America, Inc. and its affiliates.

TBC Corporation has guaranteed all obligations of Tire Kingdom, Inc. to
Continental General Tire, Inc.

Capital Lease relating to the Salt Lake City Warehouse of Big O Tires, Inc.
(book value as of 2/28/03 is $1,162,666).

<PAGE>

                                                                SCHEDULE 6.01(e)

           GUARANTEE OBLIGATIONS OF BIG O TIRES, INC. AND SUBSIDIARIES

                                             Big O Guarantee Portion at 12/31/02
<TABLE>
<S>                                                         <C>
The CIT Group

         Intermountain Realty  - Colorado Springs           $      411,995.64
         Intermountain Realty - Sioux Falls                        380,757.97
Merrill Lynch

         Loan portfolio (sold 6/30/97,9/30/97,12/31/98)             92,956.28
GE Capital
         Las Vegas                                               2,787,922.87
         Las Vegas                                                 394,156.28
         82nd St. Oregon                                           247,277.12
         Boulder, CO                                                48,917.50
OKC, LLC JV                                                        150,000.00
Real Estate Lease Guarantees                                     1,315,240.18
Synthetic Lease                                                  8,757,896.38
                                                                 ------------
Total Guarantees                                            $   14,587,120.22

</TABLE>

<PAGE>

                                                                   SCHEDULE 6.02

                                 EXISTING LIENS

-     Liens arising under the Guarantee and Collateral Agreement.

-     Numerous UCC financing statements evidencing operating lease transactions
      in which TBC Corporation and its Subsidiaries are lessees have been filed
      and are still in effect.

-     Mortgage on the Tennessee headquarters of TBC Corporation recorded
      pursuant to the Existing Credit Agreement (which shall be released prior
      to recordation of Mortgage pursuant to Section 4.01(g) of this Credit
      Agreement).

UCC Filings and Mortgages Against Big O Tires, Inc. and Its Subsidiaries:

      The Bank of Cherry Creek, N.A., as Indenture Trustee. Security interests
      and mortgages granted in connection with 8.71% Senior Secured Notes in the
      aggregate original principal amount of $8,000,000 issued by Big O Tires,
      Inc. in 1994. Notes were paid in full in 1999, and Big O Tires, Inc. has
      tried on numerous occasions, without success, to obtain termination
      statements for various UCC filings relating thereto.

      The CIT Group/Equipment Financing, Inc. Filings in connection with sales
      of franchisee notes receivable.

      SunTrust Bank, as Agent. Filings in connection with Synthetic Leases.

      First National Bank of Dieterich. Filing in connection with equipment
      financing by Big O Tire of Idaho, inc.

      Steve W. Mead

            Filing to evidence consigned Interstate Battery System of America
            inventory.

            UCC Filings Against Tire Kingdom, Inc.:

            Michelin North America, Inc. and related entities.
            Purchase money security interest filing against all inventory
            purchased from secured party by Tire Kingdom and all proceeds
            therefrom.

UCC Filings Against Merchant's, Incorporated or Merban, Inc:

            Bridgestone/Firestone, Inc.
            Consigned inventory of the secured party.

            Kimco Select Investments
<PAGE>

            Blanket security interest filed by secured party; debt has been
            discharged and secured party to release Liens promptly after the
            closing of the Merchant's Acquisition.

            CIT Group/Business Credit, Inc.

            Mortgages and blanket security interest filed by secured party; debt
            has been discharged and secured party to release mortgages and Liens
            promptly after the closing of the Merchant's Acquisition.

            Michelin North America, Inc. and related entities
            Mortgages and security interests filed by secured party, who has
            agreed to release the same promptly after the closing of the
            Merchant's Acquisition.

            SunTrust Bank
            Blanket security interest filed by secured party; debt has been
            discharged and secured party to release Liens promptly after the
            closing of the Merchant's Acquisition.

            Bandag, Incorporated
            Liens relating to Bandag equipment and related collateral used in
            the retreading operations of Merban.

<PAGE>

                                                                SCHEDULE 6.04(b)

                     CERTAIN EXISTING INVESTMENTS AND LOANS

-     See Schedule 3.01 for a listing of all existing Subsidiaries.

-     TBC Corporation owns 40% of STI Acquisition LLC, a Nevada limited
      liability company.

-     TBC Corporation owns 20,000 shares of Series A Preferred Stock, $.01 par
      value, of Quirk Automotive, Corp. and 14.4 shares of Common Stock, $100
      par value, of V.I.P., Inc. (total investment - $5,000,000).

-     TBC International Inc. owns approximately 49% of the ownership interests
      in TBC de Mexico, S.A. de C.V., a Mexican company.

-     Big O Retail Enterprises, Inc. is a 50% shareholder in Tires Industries
      Corporation, a Utah corporation.

-     Big O Development, Inc. loaned Betsy Paulsen Tufts $297,000 on October 10,
      1994. At 12/31/02, the balance on the promissory note relating thereto was
      $122,483.

-     Carroll's, Inc. owns 50 shares of stock of The Hercules Tire & Rubber
      Company.

-     Carroll's Inc. owns 360 shares of stock of Carmerica, Inc.

-     Big O Tires, Inc. holds a 50% interest in each of the following joint
      ventures:

            BORE/MPC, LLC (a Missouri LLC)
            Big O/Stephenson Joint Venture LLC (a Nevada LLC)
            OKC, LLC (a Colorado LLC)
            Intermountain Development Joint Venture (a Colorado general
            partnership)
            One Stop Undercar Denver, LLC (a Colorado LLC)

<PAGE>

                                                                   SCHEDULE 6.07

                              EXISTING RESTRICTIONS

The documents evidencing the Prudential Debt and the Additional Prudential Debt
contain restrictions and conditions of the type described in Section 6.07.

The Synthetic Leases contain restrictions and conditions of the type described
in Section 6.07.

It is expected that the documents evidencing the SunTrust Sale and Leaseback
will contain restrictions and conditions of the type described in Section 6.07.

<PAGE>

                                                                   SCHEDULE 6.13

                               CERTAIN ASSET SALES

                                      NONE.

292208.1

292210.1
<PAGE>

                                                                              12

                  "Issuing Bank" means First Tennessee Bank National Association
and JPMorgan Chase Bank, each in its capacity as the issuer of Letters of Credit
hereunder, and its successors in such capacity as provided in Section 2.05(i).
The Issuing Bank may, in its discretion, arrange for one or more Letters of
Credit to be issued by Affiliates of the Issuing Bank, in which case the term
"Issuing Bank" shall include any such Affiliate with respect to Letters of
Credit issued by such Affiliate.

                  "Joint Venture" means a joint venture formed to provide
distribution for the products of the Borrower, Big O Tires, Inc. or any other
Subsidiary, which joint venture is accounted for under GAAP as an investment and
not as a Subsidiary or as an acquisition or a capital expenditure.

                  "LC Disbursement" means a payment made by any Issuing Bank
pursuant to a Letter of Credit.

                  "LC Exposure" means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by or
on behalf of the Borrower at such time. The LC Exposure of any Lender at any
time shall be the aggregate of the Lender's participations under Section 2.05(e)
in the outstanding Letters of Credit at such time, including its aggregate
participations in Letters of Credit with respect to which one or more LC
Disbursements that have not yet been reimbursed by or on behalf of the Borrower.

                  "Lenders" means the Persons listed on Schedule 2.01 and any
other Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Acceptance. Unless the context otherwise requires, the term
"Lenders" includes the Swingline Lender.

                  "Letter of Credit" means any letter of credit issued pursuant
to this Agreement.

                  "Leverage Ratio" at any time means the ratio of Consolidated
Funded Indebtedness as of the end of the most recent Fiscal Quarter to the
aggregate EBITDA for the four Fiscal Quarter period ended with the most recent
Fiscal Quarter, and includes any adjustments based on Acceptable Acquisitions
and dispositions as provided in the definition of EBITDA.

                  "LIBO Rate" means, with respect to any Eurodollar Borrowing
for any Interest Period, the rate appearing on Page 3750 of the Telerate Service
(or on any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal

<PAGE>

                                                                              13

London office of JPMorgan Chase Bank in immediately available funds in the
London interbank market at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period.

                  "Lien" means, with respect to any asset, (a) any mortgage,
deed of trust, lien, pledge, hypothecation, encumbrance, charge or security
interest in, on or of such asset, (b) the interest of a vendor or a lessor under
any conditional sale agreement, capital lease or title retention agreement (or
any financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.

                  "Loan Documents" means this Agreement, the Guarantee and
Collateral Agreement, any Mortgage and any other Guarantee of any of the
Facility Obligations that may from time to time be in effect.

                  "Loans" means the loans made by the Lenders to the Borrower
pursuant to this Agreement.

                  "Long-Term Indebtedness" means any Indebtedness that, in
accordance with GAAP, constitutes (or, when incurred, constituted) a long-term
liability.

                  "Material Adverse Effect" means a material adverse effect on
(a) the business, assets, operations, prospects or condition, financial or
otherwise, of the Borrower and its Subsidiaries taken as a whole or (b) the
validity or enforceability of this Agreement or any of the other Loan Documents
or the rights or remedies of the Administrative Agent of the Lenders hereunder
or thereunder.

                  "Material Indebtedness" means Indebtedness (other than the
Loans and Letters of Credit) or obligations in respect of one or more Hedging
Agreements, of any one or more of the Borrower and its Subsidiaries in an
aggregate principal amount exceeding $5,000,000. For purposes of determining
Material Indebtedness, the "principal amount" of the obligations of the Borrower
or any Subsidiary in respect of any Hedging Agreement at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that the
Borrower or such Subsidiary would be required to pay if such Hedging Agreement
were terminated at such time.

                  "Merchant's Acquisition" has the meaning assigned thereto in
the recitals hereto.

                  "Merchant's Acquisition Agreement" means the Stock Purchase
Agreement, dated as of March 25, 2003, by and among the Borrower and the
stockholders of Merchant's Incorporated.

                  "Merchant's Acquisition Documentation" means, collectively,
the Merchant's Acquisition Agreement and all schedules, exhibits and annexes
thereto and all side letters and agreements affecting the terms thereof or
entered into in connection therewith.

                  "Moody's" means Moody's Investors Service, Inc.

<PAGE>

                                                                              14

                  "Mortgage" means any mortgage referred to in Section 4.01(g)
and any mortgage executed and delivered after the Closing Date pursuant to
Section 5.13(a).

                  "Mortgaged Property" means the property described in Section
4.01(g) and any real properties as to which the Collateral Agent shall be
granted a Mortgage pursuant to Section 5.13(a).

                  "Multiemployer Plan" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.

                  "Net Proceeds" means, with respect to any event, (a) the cash
proceeds received in respect of such event, including (i) any cash received in
respect of any non-cash proceeds, but only as and when received, (ii) in the
case of a casualty or other insured damage, insurance proceeds, and (iii) in the
case of a condemnation or similar event, condemnation awards and similar
payments, net of (b) the sum of (i) all reasonable fees and out-of-pocket
expenses paid by the Borrower and its Subsidiaries to third parties in
connection with such event, (ii) in the case of a sale, transfer or other
disposition of an asset (including pursuant to a sale and leaseback transaction
permitted under Section 6.13(d) or a casualty or a condemnation or similar
proceeding), the amount of all payments required to be made by the Borrower and
its Subsidiaries as a result of such event to repay Indebtedness (other than
Loans, the Prudential Debt and the Additional Prudential Notes) secured by such
asset or otherwise subject to mandatory prepayment as a result of such event (to
the extent such repayment is permitted hereunder), and (iii) the amount of all
taxes paid (or reasonably estimated to be payable) by the Borrower or any
Subsidiary, and the amount of any reserves established by the Borrower and its
Subsidiaries to fund contingent liabilities or contingent obligations reasonably
estimated to be available, in each case during the year that such event occurred
or the next succeeding year and that are directly attributable to such event (as
determined reasonably and in good faith by the chief financial officer of the
Borrower), provided that the amount of any subsequent reduction of any such
reserve (other than in connection with a payment in respect of any such
liability) shall be deemed to be Net Proceeds of a Prepayment Event occurring on
the date of such reduction.

                  "New Lender" has the meaning set forth in Section 2.02(e).

                  "New Lender Supplement" has the meaning set forth in Section
2.02(e).

                  "Other Taxes" means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement.

                  "Participant" has the meaning set forth in Section 9.04(c).

                  "PBGC" means the Pension Benefit Guaranty Corporation referred
to and defined in ERISA and any successor entity performing similar functions.

                  "Permitted Encumbrances" means:

<PAGE>

                                                                              15

                  (a)      Liens imposed by law for taxes that are not yet due
         or are being contested in compliance with Section 5.05;

                  (b)      carriers', warehousemen's, mechanics', materialmen's,
         repairmen's and other like Liens imposed by law, arising in the
         ordinary course of business and securing obligations that are not
         overdue by more than 30 days or are being contested in compliance with
         Section 5.05;

                  (c)      pledges and deposits made in the ordinary course of
         business in compliance with workers' compensation, unemployment
         insurance and other social security laws or regulations;

                  (d)      deposits to secure the performance of bids, trade
         contracts, leases, statutory obligations, surety and appeal bonds,
         performance bonds and other obligations of a like nature, in each case
         in the ordinary course of business;

                  (e)      judgment liens in respect of judgments that do not
         constitute an Event of Default under clause (k) of Article VII;

                  (f)      easements, zoning restrictions, rights-of-way and
         similar encumbrances on real property imposed by law or arising in the
         ordinary course of business that do not secure any monetary obligations
         and do not materially detract from the value of the affected property
         or interfere with the ordinary conduct of business of the Borrower or
         any Subsidiary; and

                  (g)      Liens of landlords on fixtures and leasehold
         improvements granted or arising in the ordinary course of business;

provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.

                  "Permitted Investments" means:

                  (a)      direct obligations of, or obligations the principal
         of and interest on which are unconditionally guaranteed by, the United
         States of America (or by any agency thereof to the extent such
         obligations are backed by the full faith and credit of the United
         States of America), in each case maturing within one year from the date
         of acquisition thereof;

                  (b)      investments in commercial paper maturing within 270
         days from the date of acquisition thereof and having, at such date of
         acquisition, the highest credit rating obtainable from S&P or from
         Moody's;

                  (c)      investments in certificates of deposit, banker's
         acceptances and time deposits maturing within 180 days from the date of
         acquisition thereof issued or guaranteed by or placed with, and money
         market deposit accounts issued or offered by, any domestic office of
         any commercial bank organized under the laws of the United

<PAGE>

                                                                              16

         States of America or any State thereof which has a combined capital and
         surplus and undivided profits of not less than $500,000,000; and

                  (d)      fully collateralized repurchase agreements with a
         term of not more than 30 days for securities described in clause (a)
         above and entered into with a financial institution satisfying the
         criteria described in clause (c) above.

                  "Person" means any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.

                  "Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.

                  "Prepayment Event" means:

                  (a)      any sale and leaseback transaction permitted pursuant
         to Section 6.13(d), or any other sale, transfer, or other disposition
         of any property or asset of the Borrower or any Subsidiary, other than
         dispositions permitted pursuant to Section 6.13(a), (b), (c) (e) (f) or
         (g);

                  (b)      any casualty or other insured damage to, or any
         taking under power of eminent domain or by condemnation or similar
         proceeding of, any property or asset of the Borrower or any Subsidiary,
         but only to the extent that the Net Proceeds therefrom have not been
         applied to repair, restore or replace such property or asset or to
         acquire other real property, equipment or other tangible assets to be
         used in the business of the Borrower or any Subsidiary within one year
         after such event; or

                  (c)      the incurrence by the Borrower or any Subsidiary of
         any Indebtedness, other than Indebtedness permitted by Section 6.01.

                  "Prime Rate" means the rate of interest per annum publicly
announced from time to time by JPMorgan Chase Bank as its prime rate in effect
at its principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.

                  "Properties" has the meaning set forth in Section 3.06(b).

                  "Prudential" means The Prudential Insurance Company of America
together with any of its affiliates, managed accounts and funds from time to
time holding Prudential Debt or Additional Prudential Notes.

                  "Prudential Debt" means Borrower's obligations pursuant to a
certain Second Amended and Restated Note Agreement to be dated as of April 1,
2003 between Borrower and The Prudential Insurance Company of America
("Prudential") (the "Existing Note Agreement"), governing the terms of the
Borrower's (i) 8.30% Series A Senior Notes due July 10, 2003, (ii)

<PAGE>

                                                                              17

8.62% Series B Senior Notes due July 10, 2005 and (iii) 8.81% Series C Senior
Notes due July 10, 2008.

                   "Register" has the meaning set forth in Section 9.04(b).

                  "Reimbursement Obligation" means the obligation of the
Borrower to reimburse any Issuing Bank pursuant to Section 2.05(e) for amounts
drawn under Letters of Credit.

                  "Related Parties" means, with respect to any specified Person,
such Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.

                  "Required Lenders" means, at any time, Lenders having
aggregate Revolving Credit Exposures, Term Loan Exposures and unused Revolving
Credit Commitments representing more than 51% of the sum of the total Revolving
Credit Exposures, Term Loan Exposures and unused Revolving Credit Commitments at
such time.

                  "Restricted Payment" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any shares of
any class of capital stock of the Borrower or any Subsidiary, or any payment
(whether in cash, securities or other property), including any sinking fund or
similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such shares of capital stock of
the Borrower or any option, warrant or other right to acquire any such shares of
capital stock of the Borrower.

                  "Revolving Credit Commitment" means, with respect to each
Lender, the commitment of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.08, (b)
reduced or increased from time to time pursuant to assignments by or to such
Lenders pursuant to Section 9.04 and (c) increased from time to time pursuant to
Section 2.02(d). The initial amount of each Lender's Revolving Credit Commitment
is set forth on Schedule 2.01, or in the Assignment and Acceptance pursuant to
which such Lender shall have assumed its Revolving Credit Commitment, as
applicable. The initial aggregate amount of the Lenders' Revolving Credit
Commitments is $121,500,000.

                  "Revolving Credit Exposure" means, with respect to any Lender
at any time, the sum of the outstanding principal amounts of such Lender's
Revolving Loans and its LC Exposure and Swingline Exposure at such time.

                  "Revolving Credit Maturity Date" means April 1, 2008.

                  "Revolving Loan" means a Loan made pursuant to Section 2.03.

                  "S&P" means Standard & Poor's.

                  "Scheduled Payments" means, for any period, the sum (without
duplication) of the aggregate amount of scheduled principal payments made during
such period in respect of

<PAGE>

                                                                              18

Long-Term Indebtedness of the Borrower and its Subsidiaries (other than payments
made by the Borrower or any Subsidiary to the Borrower or a Subsidiary).

                  "Solvent", when used with respect to any Person, means that,
as of any date of determination, (a) the amount of the "present fair saleable
value" of the assets of such Person will, as of such date, exceed the amount of
all "liabilities of such Person, contingent or otherwise", as of such date, as
such quoted terms are determined in accordance with applicable federal and state
laws governing determinations of the insolvency of debtors, (b) the present fair
saleable value of the assets of such Person will, as of such date, be greater
than the amount that will be required to pay the liability of such Person on its
debts as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) "debt" means liability on a "claim", and
(ii) "claim" means any (x) right to payment, whether or not such a right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y)
right to an equitable remedy for breach of performance if such breach gives rise
to a right to payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent, matured or unmatured, disputed,
undisputed, secured or unsecured.

                  "Statutory Reserve Rate" means a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board to which the Administrative Agent is
subject for eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. Eurodollar Loans shall be
deemed to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.

                  "subsidiary" means, with respect to any Person (the "parent")
at any date, any corporation, limited liability company, partnership,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the ordinary voting
power or, in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, controlled or held, or (b) that is, as of
such date, otherwise Controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent, except
that no Joint Venture in which the entire amount invested by the Borrower and
its Subsidiaries complies with Section 6.04(d), shall be deemed to be a
subsidiary.

                  "Subsidiary" means any subsidiary of the Borrower; provided,
however, that in no event shall TBC de Mexico be considered to be a Subsidiary
for purposes hereof (but, to the

<PAGE>

                                                                              19

extent required by GAAP, shall be consolidated in the consolidated financial
statements of the Borrower and as such included in the calculation of the
covenants in Sections 6.08, 6.09 and 6.10) until such time, if any, as
Borrower's interest in TBC de Mexico exceeds 60%, Borrower is required by GAAP
to consolidate TBC de Mexico into Borrower's consolidated financial statements,
and Borrower's equity investment in TBC de Mexico exceeds $2,500,000.

                  "Substantial Portion" means, with respect to the property of
the Borrower and its Subsidiaries, property which (i) represents more than 10%
of the consolidated assets of the Borrower and its Subsidiaries as would be
shown in the consolidated financial statements of the Borrower and its
Subsidiaries as at the beginning of the twelve-month period ending at the end of
the month in which such determination is made, or (ii) is responsible for more
than 10% of the consolidated net sales or of the Consolidated Net Income of the
Borrower and its Subsidiaries as reflected in the financial statements referred
to in clause (i) above.

                  "SunTrust Sale and Leaseback" means the sale for a price not
to exceed $12,000,000 and the leasing back of up to fourteen retail stores
currently owned by Merchant's, Incorporated.

                  "Swingline Exposure" means, at any time, the aggregate
principal amount of all Swingline Loans outstanding at such time. The Swingline
Exposure of any Lender at any time shall be its Applicable Percentage of the
total Swingline Exposure at such time.

                  "Swingline Lender" means First Tennessee Bank National
Association, in its capacity as lender of Swingline Loans hereunder.

                  "Swingline Loan" means a Loan made pursuant to Section 2.04.

                  "Synthetic Lease" means any lease entered into by Big O Tires,
Inc. or Big O Development, Inc. (each a "Lessee") pursuant to the existing
$15,000,000 lease program with SunTrust Capital Markets, Inc. ("SunTrust")
contemplated by that certain Master Agreement, dated as of December 2, 1998,
among the Lessees, SunTrust, Borrower, and the Atlantic Financial Group, Ltd.,
as from time to time amended.

                  "Taxes" means any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.

                  "Term Loan Exposure" means, with respect to any Lender at any
time, the sum of the outstanding principal amounts of such Lender's Term Loans
at such time.

                  "Term Loan Maturity Date" means April 1, 2008.

                  "Term Loans" means, collectively, the Tranche A Term Loans and
the Tranche B Term Loans.

                  "Tranche A Term Commitment" means as to any Lender the
obligation of such Lender, if any, to make a Tranche A Term Loan to the Borrower
in a principal amount not to exceed the amount set forth under the heading
"Tranche A Term Commitment" opposite such Lender's name on Schedule 2.01.

<PAGE>

                                                                              20

                  "Tranche A Term Lender" means each Lender that has a Tranche A
Term Commitment or that holds a Tranche A Term Loan.

                  "Tranche A Term Loan" means a Loan made pursuant to Section
2.01(b).

                  "Tranche B Term Commitment" means as to any Lender the
obligation of such Lender, if any, to make a Tranche B Term Loan to the Borrower
in a principal amount not to exceed the amount set forth under the heading
"Tranche B Term Commitment" opposite such Lender's name on Schedule 2.01.

                  "Tranche B Term Exposure" means, with respect to any Lender at
any time, the sum of the outstanding principal amounts of such Lender's Tranche
B Term Loans.

                  "Tranche B Term Lender" means each Lender that has a Tranche B
Term Commitment or that holds a Tranche B Term Loan.

                  "Tranche B Term Loan" means a Loan made pursuant to Section
2.01(c).

                  "Tranche B Term Loan Availability Period" means the period
from and including the Effective Date to but excluding September 30, 2003.

                  "Transactions" means the execution, delivery and performance
by the Borrower of the Loan Documents, the borrowing of Loans, the use of the
proceeds thereof and the issuance of Letters of Credit hereunder and the
execution, delivery and performance by the Guarantors of the Facility
Obligations.

                  "Type", when used in reference to any Loan or Borrowing,
refers to whether the rate of interest on such Loan, or on the Loans comprising
such Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.

                  "Wholly-Owned Subsidiary" of a Person means any Subsidiary all
of whose outstanding voting securities, or ownership interests having ordinary
voting power, are at the time owned (i) directly by such Person, (ii) directly
and indirectly by such Person and one or more of such Person's Wholly-Owned
Subsidiaries or (iii) by one or more of such Person's Wholly-Owned Subsidiaries.

                  "Withdrawal Liability" means liability to a Multiemployer Plan
as a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.

                  SECTION 1.02. Classification of Loans and Borrowings. For
purposes of this Agreement, Loans may be classified and referred to by Class
(e.g., a "Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class
and Type (e.g., a "Eurodollar Revolving Loan"). Borrowings also may be
classified and referred to by Class (e.g., a "Revolving Borrowing") or by Type
(e.g., a "Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar
Revolving Borrowing").

<PAGE>

                                                                              21

                  SECTION 1.03. Terms Generally. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
The word "will" shall be construed to have the same meaning and effect as the
word "shall". Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections and Schedules shall be construed to
refer to Articles and Sections of, and Schedules to, this Agreement and (e) the
words "asset" and "property" shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts, contract rights and all other
real and personal property.

                  SECTION 1.04. Accounting Terms; GAAP. Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed, and all financial information and reports provided pursuant to
this Agreement shall be prepared, in accordance with GAAP, as in effect from
time to time; provided that, if the Borrower notifies the Co-Administrative
Agent that the Borrower requests an amendment to any provision hereof to
eliminate the effect of any change occurring after the date hereof in GAAP or in
the application thereof on the operation of such provision (or if the
Co-Administrative Agent notifies the Borrower that the Required Lenders request
an amendment to any provision hereof for such purpose), regardless of whether
any such notice is given before or after such change in GAAP or in the
application thereof, then such provision shall be interpreted on the basis of
GAAP as in effect and applied immediately before such change shall have become
effective until such notice shall have been withdrawn or such provision amended
in accordance herewith.

                                   ARTICLE II

                                   The Credits

                  SECTION 2.01. Revolving and Term Loan Commitments. (a) Subject
to the terms and conditions set forth herein, each Lender agrees to make
Revolving Loans to the Borrower from time to time during the Availability Period
in an aggregate principal amount that will not result in (i) such Lender's
Revolving Credit Exposure exceeding such Lender's Revolving Credit Commitment or
(ii) the sum of the total Revolving Credit Exposures exceeding the total
Revolving Credit Commitments. Within the foregoing limits and subject to the
terms and conditions set forth herein, the Borrower may borrow, prepay and
reborrow Revolving Loans.

                  (b)      Subject to the terms and conditions set forth herein,
each Tranche A Term Lender agrees to make a Tranche A Term Loan to the Borrower
on the Effective Date in the amount so designated after such Lender's name in
Schedule 2.01 not to exceed the Tranche A

<PAGE>

                                                                              22

Term Commitment of such Lender. Once a Tranche A Term Loan is repaid or prepaid,
it may not be reborrowed.

                  (c)      Subject to the terms and conditions set forth herein,
each Tranche B Term Lender agrees to make Tranche B Term Loans in minimum
amounts of its ratable share of $5,000,000 to the Borrower on the Effective Date
and on up to two occasions thereafter during the Tranche B Term Loan
Availability Period in an aggregate principal amount not to exceed the Tranche B
Term Commitment of such Lender. Once a Tranche B Term Loan is repaid or prepaid,
it may not be reborrowed.

                  SECTION 2.02. Loans and Borrowings. (a) Each Loan shall be
made as part of a Borrowing consisting of Loans made by the Lenders ratably in
accordance with their respective Commitments to make Loans of the applicable
Class, provided that Borrowings of Revolving Loans shall consist of Loans made
by the Lenders ratably in accordance with their respective Available Revolving
Credit Commitments. The failure of any Lender to make any Loan required to be
made by it shall not relieve any other Lender of its obligations hereunder;
provided that the Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender's failure to make Loans as required.

                  (b)      Subject to Section 2.13, (i) each Revolving Borrowing
shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may
request in accordance herewith and (ii) each Term Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement.

                  (c)      At the commencement of each Interest Period for any
Eurodollar Revolving Borrowing, such Borrowing shall be in an aggregate amount
that is an integral multiple of $100,000 and not less than $1,000,000. At the
time that each ABR Revolving Borrowing is made, such Borrowing shall be in an
aggregate amount that is an integral multiple of $100,000 and not less than
$100,000; provided that an ABR Revolving Borrowing may be in an aggregate amount
that is equal to the entire unused balance of the total Revolving Credit
Commitments, or that is required to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.05(e). Each Swingline Loan shall be in
an amount that is an integral multiple of $100,000 and not less than $100,000.
At the commencement of each Interest Period for any Eurodollar Term Borrowing,
such Borrowing shall be in an aggregate amount that is an integral multiple of
$100,000 and not less than $1,000,000. Borrowings of more than one Type may be
outstanding at the same time; provided that there shall not at any time be more
than a total of twelve Eurodollar Borrowings outstanding.

                  (d)      The Borrower and any one or more Lenders (including
New Lenders) may from time to time agree that without the consent of the other
Lenders hereunder such Lenders shall increase the amount of such Lenders'
Revolving Commitments (or in the case of New Lenders establish Revolving
Commitments) by executing and delivering to the Co-Administrative Agent an
Incremental Facility Activation Notice specifying (i) the respective amounts of
such increases (or such new Revolving Commitments) and (ii) the applicable

<PAGE>

                                                                              23

Incremental Facility Closing Date, provided, that (A) no Default or Event of
Default has occurred and is continuing or would result after giving effect to
the increase of the Revolving Commitments or the intended application of the
proceeds therefrom, (B) the Applicable Rate determined as of the applicable
Incremental Facility Closing Date shall not be greater than the Applicable Rate
then in effect for Revolving Loans, (C) the aggregate Revolving Commitments
after giving effect to any increase pursuant to this Section 2.02(d) shall not
exceed $150,000,000 and (D) each increase in the Revolving Commitments pursuant
to this Section 2.02(d) shall be in a minimum amount of at least $5,000,000. Any
incremental Revolving Commitments shall be governed by this Agreement and the
other Loan Documents. No Lender shall have any obligation to participate in any
increase described in this paragraph unless it agrees in writing to do so in its
sole discretion.

                  (e)      Any additional bank, financial institution or other
entity that, with the consent of the Borrower and the Co-Administrative Agent
(which consent shall not be unreasonably withheld), elects to become a "Lender"
under this Agreement in connection with any transaction described in Section
2.02(d) shall execute a New Lender Supplement (each, a "New Lender Supplement"),
substantially in the form of Schedule 2.02, whereupon such bank, financial
institution or other entity (a "New Lender") shall become a Lender for all
purposes and shall be bound by and entitled to the benefits of this Agreement.

                  (f)      The Borrower shall borrow Revolving Loans under the
increased Revolving Commitments from each Lender participating in any increase
in the Revolving Commitments pursuant to Section 2.2(d) (i) on the relevant
Incremental Facility Closing Date, if ABR Revolving Loans are then outstanding,
in an amount of ABR Loans that will result in each such participating Lender
having ABR Loans outstanding in a principal amount equal to its Applicable
Percentage of the total outstanding principal amount of ABR Loans and (ii) on
such Incremental Facility Closing Date, if a Eurodollar Borrowing is being
continued for another Interest Period on such date, and in and on any later date
on which a Eurodollar Borrowing outstanding on such Incremental Facility Closing
Date is being continued for another Interest Period, in each case in an amount
that will result in each such participating Lender having Eurodollar Revolving
Loans made by it included in such Eurodollar Borrowing in a principal amount
equal to its Applicable Percentage of the total outstanding principal amount of
Eurodollar Loans included in such Eurodollar Borrowing.

                  (g)      Notwithstanding any other provision of this
Agreement, the Borrower shall not be entitled (i) to request, or to elect to
convert or continue, any Borrowing of Revolving Loans if the Interest Period
requested with respect thereto would end after the Revolving Credit Maturity
Date or (ii) to convert or continue any Borrowing of Term Loans if the Interest
Period requested with respect thereto would end after the Term Loan Maturity
Date.

                  SECTION 2.03. Requests for Borrowings. (a) To request a
Revolving Borrowing, the Borrower shall give to the Administrative Agent
irrevocable notice which notice must be received by the Administrative Agent (1)
in the case of a Eurodollar Borrowing, not later than 11:30 a.m., Memphis,
Tennessee time, three Business Days before the date of the proposed Revolving
Borrowing or (2) in the case of an ABR Borrowing, not later than 11:30 a.m.,
Memphis, Tennessee time, on the Business Day of the proposed Revolving
Borrowing; provided that any such notice of an ABR Revolving Borrowing to
finance any Reimbursement

<PAGE>

                                                                              24

Obligation may be given no later than 10:00 am, Memphis, Tennessee time on the
date of the proposed Borrowing. Each such Borrowing Request shall specify the
following information:

                  (i)      the aggregate amount of the requested Revolving
         Borrowing;

                  (ii)     the date of such Revolving Borrowing, which shall be
         a Business Day;

                  (iii)    whether such Revolving Borrowing is to be an ABR
         Borrowing, or a Eurodollar Borrowing;

                  (iv)     in the case of a Eurodollar Revolving Borrowing, the
         initial Interest Period to be applicable thereto, which shall be a
         period contemplated by the definition of the term "Interest Period";
         and

                  (v)      the location and number of the Borrower's account to
         which funds are to be disbursed, which shall comply with the
         requirements of Section 2.06.

If no election as to the Type of Revolving Borrowing is specified, then the
requested Borrowing shall be an ABR Borrowing. If no Interest Period is
specified with respect to any requested Eurodollar Revolving Borrowing, then the
Borrower shall be deemed to have selected an Interest Period of one month's
duration. Promptly following receipt of a Borrowing Request in accordance with
this Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender's Loan to be made as part of the
requested Borrowing.

                  (b)      To request a Term Borrowing, the Borrower shall give
to the Administrative Agent irrevocable notice which notice must be received by
the Administrative Agent (1) in the case of a Eurodollar Borrowing, not later
than 11:30 a.m., Memphis, Tennessee time, three Business Days before the date of
the proposed Borrowing or (2) in the case of an ABR Borrowing, not later than
11:30 a.m., Memphis, Tennessee time, on the Business Day of the proposed Term
Borrowing. Each such telephonic and written Borrowing Request shall specify the
following information:

                  (i)      the aggregate amount of the requested Term Borrowing;

                  (ii)     the date of such Term Borrowing, which shall be a
         Business Day;

                  (iii)    whether such Term Borrowing is to be an ABR
         Borrowing, or a Eurodollar Borrowing;

                  (iv)     in the case of a Eurodollar Term Borrowing, the
         initial Interest Period to be applicable thereto, which shall be a
         period contemplated by the definition of the term "Interest Period";
         and

                  (v)      the location and number of the Borrower's account to
         which funds are to be disbursed, which shall comply with the
         requirements of Section 2.06.

If no election as to the Type of Term Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested

<PAGE>

                                                                              25

Eurodollar Term Borrowing, then the Borrower shall be deemed to have selected an
Interest Period of one month's duration. Promptly following receipt of a
Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Term Lender of the details thereof and of the amount of such
Lender's Term Loan to be made as part of the requested Term Borrowing.

                  SECTION 2.04. Swingline Loans. (a) Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline Loans
to the Borrower from time to time during the Availability Period, in an
aggregate principal amount at any time outstanding that will not result in (i)
the aggregate principal amount of outstanding Swingline Loans exceeding the
lesser of 15% of the Revolving Credit Commitments or $20,000,000 or (ii) the sum
of the total Revolving Credit Exposures exceeding the total Revolving Credit
Commitments; provided that the Swingline Lender shall not be required to make a
Swingline Loan to refinance an outstanding Swingline Loan. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower
may borrow, prepay and reborrow Swingline Loans.

                  (b)      To request a Swingline Loan, the Borrower shall
notify the Administrative Agent of such request by telephone (confirmed by
telecopy), not later than 12:00 p.m., Memphis, Tennessee time, on the day of a
proposed Swingline Loan. Each such notice shall be irrevocable and shall specify
the requested date (which shall be a Business Day) and amount of the requested
Swingline Loan. The Administrative Agent will promptly advise the Swingline
Lender of any such notice received from the Borrower. The Swingline Lender shall
make each Swingline Loan available to the Borrower by means of a credit to the
general deposit account of the Borrower with the Swingline Lender (or, in the
case of a Swingline Loan made to finance the reimbursement of an LC Disbursement
as provided in Section 2.05(e), by remittance to the Issuing Bank) by 3:00 p.m.,
Memphis, Tennessee time, on the requested date of such Swingline Loan.

                  (c)      The Swingline Lender may by written notice given to
the Administrative Agent not later than 10:00 a.m., Memphis, Tennessee time, on
any Business Day require the Lenders to acquire participations on such Business
Day in all or a portion of the Swingline Loans outstanding. Such notice shall
specify the aggregate amount of Swingline Loans in which Lenders will
participate. Promptly upon receipt of such notice, the Administrative Agent will
give notice thereof to each Lender, specifying in such notice such Lender's then
Applicable Percentage of such Swingline Loan or Loans. Each Lender hereby
absolutely and unconditionally agrees, upon receipt of notice as provided above,
to pay to the Administrative Agent, for the account of the Swingline Lender,
such Lender's then Applicable Percentage of such Swingline Loan or Loans. Each
Lender acknowledges and agrees that its obligation to acquire participations in
Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence
and continuance of a Default or reduction or termination of the Revolving Credit
Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Each Lender shall comply with
its obligation under this paragraph by wire transfer of immediately available
funds, in the same manner as provided in Section 2.06 with respect to Loans made
by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment
obligations of the Lenders), and the Administrative Agent shall promptly pay to
the Swingline Lender the amounts so received by it from the Lenders. The

<PAGE>

                                                                              26

Administrative Agent shall notify the Borrower of any participations in any
Swingline Loan acquired pursuant to this paragraph, and thereafter payments in
respect of such Swingline Loan shall be made to the Administrative Agent and not
to the Swingline Lender. Any amounts received by the Swingline Lender from the
Borrower (or other party on behalf of the Borrower) in respect of a Swingline
Loan after receipt by the Swingline Lender of the proceeds of a sale of
participations therein shall be promptly remitted to the Administrative Agent;
any such amounts received by the Administrative Agent shall be promptly remitted
by the Administrative Agent to the Lenders that shall have made their payments
pursuant to this paragraph and to the Swingline Lender, as their interests may
appear. The purchase of participations in a Swingline Loan pursuant to this
paragraph shall not relieve the Borrower of any default in the payment thereof.

                  SECTION 2.05. Letters of Credit. (a) General. Subject to the
terms and conditions set forth herein, the Borrower may request the issuance of
Letters of Credit for the account of the Borrower, but in the name of the
Borrower or any Subsidiary as may be specified by the Borrower, in a form
reasonably acceptable to each Issuing Bank, at any time and from time to time
during the Availability Period. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, any Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.

                  (b)      Existing Letters of Credit. From and after the
Closing Date, the Existing Letters of Credit shall be deemed outstanding
pursuant to, and shall constitute "Letters of Credit" for all purposes of, this
Agreement.

                  (c)      Notice of Issuance, Amendment, Renewal, Extension,
Certain Conditions. To request the issuance of a Letter of Credit (or the
amendment, renewal or extension of an outstanding Letter of Credit), the
Borrower shall hand deliver or telecopy (or transmit by electronic
communication, if arrangements for doing so have been approved by such Issuing
Bank) to any Issuing Bank and the Administrative Agent (reasonably in advance of
the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph (d)
of this Section), the amount of such Letter of Credit, the name and address of
the beneficiary thereof and such other information as shall be necessary to
prepare, amend, renew or extend such Letter of Credit. If requested by such
Issuing Bank, the Borrower also shall submit a letter of credit application on
such Issuing Bank's standard form in connection with any request for a Letter of
Credit. A Letter of Credit shall be issued, amended, renewed or extended only if
(and upon issuance, amendment, renewal or extension of each Letter of Credit the
Borrower shall be deemed to represent and warrant that), after giving effect to
such issuance, amendment, renewal or extension (i) the LC Exposure shall not
exceed the lesser of 20% of the Revolving Credit Commitments or $25,000,000 and
(ii) the sum of the total Revolving Credit Exposures shall not exceed the total
Revolving Credit Commitments.

                  (d)      Expiration Date. Each Letter of Credit shall expire
at or prior to the close of business on the earlier of (i) the date one year
after the date of the issuance of such Letter of

<PAGE>

                                                                              27

Credit (or, in the case of any renewal or extension thereof, one year after such
renewal or extension) and (ii) the date that is five Business Days prior to the
Revolving Credit Maturity Date.

                  (e)      Participations. By the issuance of a Letter of Credit
(or an amendment to a Letter of Credit increasing the amount thereof) and
without any further action on the part of the Issuing Bank or the Lenders, each
Issuing Bank hereby grants to each Lender, and each Lender hereby acquires from
such Issuing Bank, a participation in such Letter of Credit equal to such
Lender's Applicable Percentage as may be adjusted from time to time to reflect
assignments or transfers of Revolving Credit Commitments and any increase in the
Revolving Credit Commitment pursuant to Section 2.02(d), of the aggregate amount
available to be drawn under such Letter of Credit. In consideration and in
furtherance of the foregoing, each Lender hereby absolutely and unconditionally
agrees to pay to the Administrative Agent, for the account of such Issuing Bank,
such Lender's Applicable Percentage, determined as of the date the Letter of
Credit was issued, of each LC Disbursement made by such Issuing Bank and not
reimbursed by the Borrower on the date due as provided in paragraph (f) of this
Section, or of any reimbursement payment required to be refunded to the Borrower
for any reason. Each Lender acknowledges and agrees that its obligation to
acquire participations pursuant to this paragraph in respect of Letters of
Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Revolving Credit Commitments, and that each such payment
shall be made without any offset, abatement, withholding or reduction
whatsoever.

                  (f)      Reimbursement Obligation. If any Issuing Bank shall
make any LC Disbursement in respect of a Letter of Credit, the Borrower shall
reimburse such LC Disbursement by paying to the Administrative Agent an amount
equal to such LC Disbursement not later than 12:00 noon, Memphis, Tennessee
time, on the date that such LC Disbursement is made, if the Borrower shall have
received notice of such LC Disbursement prior to 10:00 a.m., Memphis, Tennessee
time, on such date, or, if such notice has not been received by the Borrower
prior to such time on such date, then not later than 12:00 noon, Memphis,
Tennessee time, on (i) the Business Day that the Borrower receives such notice,
if such notice is received prior to 10:00 a.m., Memphis, Tennessee time, on the
day of receipt, or (ii) the Business Day immediately following the day that the
Borrower receives such notice, if such notice is not received prior to such time
on the day of receipt; provided that if such LC Disbursement is not less than
$100,000, the Borrower may, subject to the conditions to borrowing set forth
herein, request in accordance with Section 2.03 or 2.04 that such payment be
financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent
amount and, to the extent so financed, the Borrower's obligation to make such
payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing or Swingline Loan. If the Borrower fails to make such payment when
due, the Issuing Bank shall notify the Administrative Agent thereof and the
Administrative Agent shall then notify each Lender of the applicable LC
Disbursement, the payment then due from the Borrower in respect thereof and such
Lender's Applicable Percentage thereof. Promptly following receipt of such
notice from the Administrative Agent, each Lender shall pay to the
Administrative Agent such Applicable Percentage of the payment then due from the
Borrower, in the same manner as provided in Section 2.06 with respect to Loans
made by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the
payment obligations of the Lenders), and the

<PAGE>

                                                                              28

Administrative Agent shall promptly pay to such Issuing Bank the amounts so
received by it from the Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to such
Issuing Bank or, to the extent that Lenders have made payments pursuant to this
paragraph to reimburse such Issuing Bank, then to such Lenders and such Issuing
Bank as their interests may appear. Any payment made by a Lender pursuant to
this paragraph to reimburse any Issuing Bank for any LC Disbursement (other than
the funding of ABR Revolving Loans or a Swingline Loan as contemplated above)
shall not constitute a Loan and shall not relieve the Borrower of its obligation
to reimburse such LC Disbursement.

                  (g)      Obligations Absolute. The Borrower's obligation to
reimburse LC Disbursements as provided in paragraph (f) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision therein, (ii) any
draft or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower's obligations hereunder. Neither
the Administrative Agent, the Lenders nor any Issuing Bank, nor any of their
Related Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of any
Issuing Bank; provided that the foregoing shall not be construed to excuse any
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by such Issuing Bank's failure to exercise care
when determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or wilful misconduct on the part of any
Issuing Bank (as finally determined by a court of competent jurisdiction), such
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, each
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.

                  (h)      Disbursement Procedures. Each Issuing Bank shall, in
accordance with standard banking practice following its receipt thereof, examine
all documents purporting to

<PAGE>

                                                                              29

represent a demand for payment under a Letter of Credit. Each Issuing Bank shall
promptly notify the Administrative Agent, any other Issuing Bank and the
Borrower by telephone (confirmed by telecopy) of such demand for payment and
whether such Issuing Bank has made or will make an LC Disbursement thereunder;
provided that any failure to give or delay in giving such notice shall not
relieve the Borrower of its obligation to reimburse such Issuing Bank and the
Lenders with respect to any such LC Disbursement. On the Business Day three
Business Days prior to the last day of March, June, September and December of
each year and at such other times as the Administrative Agent shall request,
each Issuing Bank shall report to the Administrative Agent all Letters of Credit
issued by it during the then current calendar quarter and the average daily
undrawn and unexpired amounts for all Letters of Credit for each day in such
calendar quarter.

                  (i)      Interim Interest. If any Issuing Bank shall make any
LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement
in full on the date such LC Disbursement is made, the unpaid amount thereof
shall bear interest, for each day from and including the date such LC
Disbursement is made to but excluding the date that the Borrower reimburses such
LC Disbursement, at the rate per annum then applicable to ABR Revolving Loans;
provided that, if the Borrower fails to reimburse such LC Disbursement when due
pursuant to paragraph (f) of this Section, then Section 2.12(d) shall apply.
Interest accrued pursuant to this paragraph shall be for the account of such
Issuing Bank, except that interest accrued on and after the date of payment by
any Lender pursuant to paragraph (f) of this Section to reimburse such Issuing
Bank shall be for the account of such Lender to the extent of such payment.

                  (j)      Replacement of the Issuing Bank. Each Issuing Bank
may be replaced at any time by written agreement among the Borrower, the
Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank.
The Administrative Agent shall notify the Lenders of any such replacement of any
Issuing Bank. At the time any such replacement shall become effective, the
Borrower shall pay all unpaid fees accrued for the account of the replaced
Issuing Bank pursuant to Section 2.11(b). From and after the effective date of
any such replacement, (i) the successor Issuing Bank shall have all the rights
and obligations of the Issuing Bank under this Agreement with respect to Letters
of Credit to be issued thereafter and (ii) references herein to the term
"Issuing Bank" shall be deemed to refer to such successor or to any previous
Issuing Bank, or to such successor and all previous Issuing Banks, as the
context shall require. After the replacement of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have all
the rights and obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit issued by it prior to such replacement, but shall not be
required to issue additional Letters of Credit.

                  (k)      Cash Collateralization. If any Event of Default shall
occur and be continuing, on the Business Day that the Borrower receives notice
from the Co-Administrative Agent or the Required Lenders (or, if the maturity of
the Loans has been accelerated, Lenders with LC Exposure representing greater
than 51% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the LC Exposure as of such
date plus any accrued and unpaid interest thereon; provided that the obligation
to deposit such cash collateral shall become

<PAGE>

                                                                              30

effective immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind, upon the occurrence of any
Event of Default with respect to the Borrower described in clause (h) or (i) of
Article VII. Such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the obligations of the Borrower
under this Agreement. The Administrative Agent shall have exclusive dominion and
control, including the exclusive right of withdrawal, over such account. Other
than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Administrative Agent and
at the Borrower's risk and expense, such deposits shall not bear interest.
Interest or profits, if any, on such investments shall accumulate in such
account. Moneys in such account shall be applied by the Administrative Agent to
reimburse each Issuing Bank for LC Disbursements for which it has not been
reimbursed and, to the extent not so applied, shall be held for the satisfaction
of the reimbursement obligations of the Borrower for the LC Exposure at such
time. If the Borrower is required to provide an amount of cash collateral
hereunder as a result of the occurrence of an Event of Default, such amount (to
the extent not applied as aforesaid) shall be returned to the Borrower within
three Business Days after all Events of Default have been cured or waived.

                  SECTION 2.06. Funding of Borrowings. (a) Provided that it has
received timely advice of the related Borrowing Request as required by the last
sentence of Section 2.03(a) or of Section 2.03(b), each Lender shall make each
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 2:00 p.m., Memphis, Tennessee time, to the
account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders; provided that Swingline Loans shall be made as
provided in Section 2.04. The Administrative Agent will make each Borrowing
available to the Borrower by promptly crediting the amounts so received, in like
funds, to an account of the Borrower maintained with the Administrative Agent in
Memphis, Tennessee and designated by the Borrower in the applicable Borrowing
Request; provided that ABR Revolving Loans made to finance the reimbursement of
an LC Disbursement as provided in Section 2.05(e) shall be remitted by the
Administrative Agent to the Issuing Bank.

                  (b)      Unless the Administrative Agent shall have received
notice from a Lender prior to the proposed date of any Borrowing that such
Lender will not make available to the Administrative Agent such Lender's share
of such Borrowing, the Administrative Agent may assume that such Lender has made
such share available on such date in accordance with paragraph (a) of this
Section and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact made
its share of the applicable Borrowing available to the Administrative Agent,
then the applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with interest
thereon, for each day from and including the date such amount is made available
to the Borrower to but excluding the date of payment to the Administrative
Agent, at (i) in the case of such Lender, the Interest Rate applicable to the
Borrowing or (ii) in the case of the Borrower, the interest rate applicable to
ABR Loans. If such Lender pays such amount to the Administrative Agent, then
such amount shall constitute such Lender's Loan included in such Borrowing.

<PAGE>

                                                                              31

                  SECTION 2.07. Interest Elections. (a) Each Revolving or Term
Borrowing initially shall be of the Type specified in the applicable Borrowing
Request and, in the case of a Eurodollar Borrowing, shall have an initial
Interest Period as specified in such Borrowing Request. Thereafter, the Borrower
may elect to convert such Borrowing to a different Type or to continue such
Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods
therefor, all as provided in this Section. The Borrower may elect different
options with respect to different portions of the affected Borrowing, in which
case each such portion shall be allocated ratably among the Lenders holding the
Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing. This Section shall not apply to
Swingline Borrowings, which may not be converted or continued.

                  (b)      To make an election pursuant to this Section, the
Borrower shall notify the Administrative Agent of such election by telephone by
the time that a Borrowing Request would be required under Section 2.03 if the
Borrower were requesting a Revolving Borrowing of the Type resulting from such
election to be made on the effective date of such election. Each such telephonic
Interest Election Request shall be irrevocable and shall be confirmed promptly
by hand delivery or telecopy to the Administrative Agent of a written Interest
Election Request in a form approved by the Administrative Agent and signed by
the Borrower.

                  (c)      Each telephonic and written Interest Election Request
shall specify the following information:

                  (i)      the Borrowing to which such Interest Election Request
                  applies and, if different options are being elected with
                  respect to different portions thereof, the portions thereof to
                  be allocated to each resulting Borrowing (in which case the
                  information to be specified pursuant to clauses (iii) and (iv)
                  below shall be specified for each resulting Borrowing);

                  (ii)     the effective date of the election made pursuant to
                  such Interest Election Request, which shall be a Business Day;

                  (iii)    whether the resulting Borrowing is to be an ABR
                  Borrowing or a Eurodollar Borrowing; and

                  (iv)     if the resulting Borrowing is a Eurodollar Borrowing,
                  the Interest Period to be applicable thereto after giving
                  effect to such election, which shall be a period contemplated
                  by the definition of the term "Interest Period".

If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.

                  (d)      Promptly following receipt of an Interest Election
Request, the Administrative Agent shall advise each Lender of the details
thereof and of such Lender's portion of each resulting Borrowing.

                  (e)      If the Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Borrowing prior to the end of the
Interest Period applicable thereto, then,

<PAGE>

                                                                              32

unless such Borrowing is repaid as provided herein, at the end of such Interest
Period such Borrowing shall be converted to an ABR Borrowing. Notwithstanding
any contrary provision hereof, if an Event of Default has occurred and is
continuing and the Administrative Agent, at the request of the Required Lenders,
so notifies the Borrower, then, so long as an Event of Default is continuing (i)
no outstanding Borrowing may be converted to or continued as Eurodollar
Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted
to an ABR Borrowing at the end of the Interest Period applicable thereto.

                  SECTION 2.08. Termination and Reduction of Revolving Credit
Commitments. (a) Unless previously terminated, the Revolving Credit Commitments
shall terminate on the Revolving Credit Maturity Date.

                  (b)      The Borrower may at any time terminate, or from time
to time reduce, the Revolving Credit Commitments; provided that (i) each
reduction of the Revolving Credit Commitments shall be in an amount that is an
integral multiple of $1,000,000 and not less than $5,000,000, (ii) the Borrower
shall not terminate or reduce the Revolving Credit Commitments if, after giving
effect to any concurrent prepayment of the Revolving Loans in accordance with
Section 2.10, the sum of the Revolving Credit Exposures would exceed the total
Revolving Credit Commitments.

                  (c)      The Borrower shall notify the Co-Administrative Agent
of any election to terminate or reduce the Revolving Credit Commitments under
paragraph (b) of this Section at least three Business Days prior to the
effective date of such termination or reduction, specifying such election and
the effective date thereof. Promptly following receipt of any notice, the
Co-Administrative Agent shall advise the Administrative Agent and the Lenders of
the contents thereof. Each notice delivered by the Borrower pursuant to this
Section shall be irrevocable; provided that a notice of termination delivered by
the Borrower may state that such notice is conditioned upon the effectiveness of
other credit facilities, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Any termination or reduction
shall be permanent. Each reduction shall be made ratably among the Lenders in
accordance with their respective Revolving Credit Commitments.

                  SECTION 2.09. Repayment of Loans; Evidence of Debt. (a) The
Borrower hereby unconditionally promises to pay (i) to the Administrative Agent
for the account of each Lender, on the Revolving Credit Maturity Date, the then
unpaid principal amount of each of the Revolving Loans and (ii) to the Swingline
Lender the then unpaid principal amount of the Swingline Loans on the earlier of
the Revolving Credit Maturity Date or the first date after such Swingline Loans
are made that is the 15th or last day of a calendar month; provided that on each
date that a Revolving Borrowing is made, the Borrower shall repay all Swingline
Loans then outstanding.

                  (b)      The Borrower hereby unconditionally promises to pay
to the Administrative Agent for the account of the Tranche A Term Lenders the
unpaid principal of all Tranche A Term Loans, on the dates and in the amounts
set forth below, with the entire unpaid principal balance due and payable on the
Term Loan Maturity Date:

<PAGE>

                                                                              33

<TABLE>
<CAPTION>
  Date                            Payment Amount
  ----                            --------------
<S>                               <C>
 9/30/03                           1,662,836.00
12/31/03                           1,662,836.00
 3/31/04                           1,662,836.00
 6/30/04                           3,563,220.00
 9/30/04                           3,563,220.00
12/31/04                           3,563,220.00
 3/31/05                           3,563,220.00
 6/30/05                           3,563,220.00
 9/30/05                           3,563,220.00
12/31/05                           3,563,220.00
 3/31/06                           3,563,220.00
 6/30/06                           3,563,220.00
 9/30/06                           3,563,220.00
12/31/06                           3,563,220.00
 3/31/07                           3,563,220.00
 6/30/07                           3,563,220.00
 9/30/07                           3,563,220.00
12/31/07                           3,563,220.00
</TABLE>

                  (c)      The Borrower hereby unconditionally promises to pay
to the Administrative Agent for the account of the Tranche B Term Lenders the
unpaid principal of all Tranche B Term Loans, on the dates and in an aggregate
amount equal to the percentage set forth below opposite such installment date
multiplied by the aggregate principal amount of the Tranche B Term Loans
outstanding at the end of the Tranche B Term Loan Availability Period, with the
entire unpaid principal balance due and payable on the Term Loan Maturity Date:

<PAGE>

                                                                              34

<TABLE>
<CAPTION>
  Date                   Percentage
  ----                   ----------
<S>                      <C>
 9/30/03                   2.6800%
12/31/03                   2.6800%
 3/31/04                   2.6800%
 6/30/04                   5.7475%
 9/30/04                   5.7475%
12/31/04                   5.7475%
 3/31/05                   5.7475%
 6/30/05                   5.7475%
 9/30/05                   5.7475%
12/31/05                   5.7475%
 3/31/06                   5.7475%
 6/30/06                   5.7475%
 9/30/06                   5.7475%
12/31/06                   5.7475%
 3/31/07                   5.7475%
 6/30/07                   5.7475%
 9/30/07                   5.7475%
12/31/07                   5.7475%
</TABLE>

                  (d)      Each Lender shall maintain in accordance with its
usual practice an account or accounts evidencing the indebtedness of the
Borrower to such Lender resulting from each Loan made by such Lender, including
the amounts of principal and interest payable and paid to such Lender from time
to time hereunder.

                  (e)      The Administrative Agent shall maintain accounts in
which it shall record (i) the amount of each Loan made hereunder, the Class and
Type thereof and the Interest Period, if any, applicable thereto, (ii) the
amount of any principal or interest due and payable or to become due and payable
from the Borrower to each Lender hereunder and (iii) the amount of any sum
received by the Administrative Agent hereunder for the account of the Lenders
and each Lender's share thereof.

                  (f)      The entries made in the accounts maintained pursuant
to paragraph (d) or (e) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.

                  (g)      Any Lender may request that Loans made by it be
evidenced by a promissory note only in order to facilitate pledges of the Loans
in accordance with Section 9.04(d). In such event, the Borrower shall prepare,
execute and deliver to such Lender a promissory note payable to the order of
such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) and in a form approved by the Co-Administrative Agent. Thereafter, the
Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 9.04(d) be represented by one or
more

<PAGE>

                                                                              35

promissory notes in such form payable to the order of the payee named therein
(or, if such promissory note is a registered note, to such payee and its
registered assigns).

                  SECTION 2.10. Prepayment of Loans. (a) The Borrower shall have
the right at any time and from time to time to prepay any Borrowing in whole or
in part, subject to prior notice in accordance with paragraph (b) of this
Section.

                  (b)      The Borrower shall notify the Administrative Agent
(and, in the case of prepayment of a Swingline Loan, the Swingline Lender) by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:30 a.m., Memphis,
Tennessee time, three Business Days before the date of prepayment, or (ii) in
the case of prepayment of an ABR Borrowing, not later than 11:30 a.m., Memphis,
Tennessee time, or (iii) in the case of prepayment of a Swingline Loan, not
later than 11:30 a.m., Memphis, Tennessee time, on the Business Day of
prepayment. Each such notice shall be irrevocable, shall identify the
Borrowing(s) being prepaid and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid; provided
that, if a notice of prepayment is given in connection with a conditional notice
of termination of the Revolving Credit Commitments as contemplated by Section
2.08, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.08. Promptly following
receipt of any such notice relating to a Borrowing, the Administrative Agent
shall advise the Lenders of the contents thereof. Each partial prepayment of any
Borrowing shall be in an amount that would be permitted in the case of an
advance of a Revolving Borrowing of the same Type as provided in Section 2.02.
Each prepayment of a Borrowing shall be applied ratably to the Loans included in
the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to
the extent required by Section 2.12.

                  (c)      Borrower shall prepay the principal of the Term
Loans, of the Prudential Debt and of the Additional Prudential Notes, upon
notice and otherwise in compliance with Section 2.10(b) and/or the Revolving
Credit Commitments shall be reduced in accordance with Section 2.08, as follows:

                           (i)      In the event that and on each occasion on
                  which any Net Proceeds are received by or on behalf of the
                  Borrower or any Subsidiary in respect of any Prepayment Event,
                  the Borrower shall, within three Business Days after such Net
                  Proceeds are received, prepay the principal of the Term Loans,
                  the Prudential Debt and the Additional Prudential Notes and/or
                  the Revolving Credit Commitments shall be subject to automatic
                  reduction, in an aggregate amount equal to such Net Proceeds,
                  such prepayment and/or reduction to be effected in each case
                  in the manner and to the extent specified in clause (ii) of
                  this paragraph.

                           (ii)     Order of Application. Prepayments and/or
                  reductions of Revolving Credit Commitments pursuant to this
                  paragraph shall be applied as follows:

                           first, (A) to prepay the Term Loans, the Prudential
Debt and the Additional Prudential Notes and

<PAGE>

                                                                              36

                           second, after the payment in full of the Term Loans,
the Prudential Debt and the Additional Prudential Notes, to reduce the aggregate
amount of the Revolving Credit Commitments (and to the extent that, after giving
effect to such reduction, the total Revolving Credit Exposures would exceed the
Revolving Credit Commitments, the Borrower shall, first, prepay Revolving Credit
Loans and second, provide cover for LC Exposure as specified in Section 2.05(k)
in an aggregate amount equal to such excess).

Any prepayment of the Term Loans, the Prudential Debt and the Additional
Prudential Notes pursuant to this paragraph shall be applied (x) to each Term
Loan, the Prudential Debt and the Additional Prudential Notes, pro rata in the
same proportions as the then balance of each Term Loan, the Prudential Debt and
the Additional Prudential Notes bears to the total balance of all Term Loans
plus the Prudential Debt and the Additional Prudential Notes, provided that if
prepayment is waived with respect to the Prudential Debt and/or the Additional
Prudential Notes, the amounts that would have been payable absent such waiver
shall be reallocated on a pro rata basis among the Term Loans and any
non-waiving note holders, and (xx) with respect to each, to the last maturing
installments thereof. Notwithstanding the foregoing, the Borrower shall not be
required to apply any prepayment to the Prudential Debt or the Additional
Prudential Notes if such prepayment is not required pursuant to the terms
thereof and would cause the Borrower to incur any prepayment premium or penalty
and, in each event, any amount which would otherwise have been used to make a
prepayment of the Prudential Debt or the Additional Prudential Notes shall
instead be used, first, to prepay the Term Loans and, second, to reduce the
aggregate amount of the Revolving Commitments (and to the extent that, after
giving effect to such reduction, the total Revolving Credit Exposures would
exceed the Revolving Credit Commitments, the Borrower shall, first, prepay
Revolving Credit Loans and second, provide cover for LC Exposure as specified in
Section 2.05(k) in an aggregate amount equal to such excess).

                  SECTION 2.11. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee, which
shall accrue (x) at a rate per annum equal to 62.5 basis points on the average
daily amount of the Available Tranche B Term Commitment of such Lender during
the period from and including the Effective Date to but excluding September 30,
2003 and (y) at the Applicable Rate on the average daily amount of the Available
Revolving Credit Commitment of such Lender during the period from and including
the Effective Date to but excluding the date on which such Revolving Credit
Commitment terminates; provided that, (i) if such Lender continues to have any
Revolving Credit Exposure after its Revolving Credit Commitment terminates, then
such commitment fee shall continue to accrue on the daily amount of such
Lender's Revolving Credit Exposure from and including the date on which its
Revolving Credit Commitment terminates to but excluding the date on which such
Lender ceases to have any Revolving Credit Exposure; and (ii) the commitment fee
payable to the Swingline Lender shall accrue on the average daily amount of its
Available Revolving Credit Commitment minus the average daily principal balance
of the Swingline Loans during such period. Accrued commitment fees shall be
payable in arrears on the last day of March, June, September and December of
each year and, with respect to commitment fees payable pursuant to clause (y)
above, on the date on which the Revolving Credit Commitments terminate,
commencing on the first such date to occur after the date hereof; provided that
any commitment fees payable pursuant to clause (y) above and accruing after the
date on which the Revolving Credit Commitments terminate shall be payable on
demand. All commitment fees shall be

<PAGE>

                                                                              37

computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).

                  (b)      The Borrower agrees to pay to the Administrative
Agent, for the account of each Lender, a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Rate as interest on Eurodollar Loans on the average daily amount of such
Lender's LC Exposure (excluding any portion thereof attributable to unreimbursed
LC Disbursements) during the period from and including the Effective Date to but
excluding the later of the date on which such Lender's Revolving Credit
Commitment terminates and the date on which such Lender ceases to have any LC
Exposure, and (ii) to each Issuing Bank a fronting fee, which shall accrue at
the rate of 12.5 basis points per annum on the average daily amount of such
Issuing Bank's LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date of termination of the
Revolving Credit Commitments and the date on which there ceases to be any LC
Exposure, as well as such Issuing Bank's standard fees with respect to the
issuance, amendment, renewal or extension of any Letter of Credit or processing
of drawings thereunder. Participation fees and fronting fees accrued through and
including the last day of March, June, September and December of each year shall
be payable on the third Business Day following such last day, commencing on the
first such date to occur after the Effective Date; provided that all such fees
shall be payable on the date on which the Revolving Credit Commitments terminate
and any such fees accruing after the date on which the Revolving Credit
Commitments terminate shall be payable on demand. Any other fees payable to any
Issuing Bank pursuant to this paragraph shall be payable within 10 days after
demand. All participation fees and fronting fees shall be computed on the basis
of a year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).

                  (c)      The Borrower agrees to pay to the Administrative
Agent, for its own account, fees payable in the amounts and at the times
separately agreed upon between the Borrower and the Administrative Agent.

                  (d)      All fees payable hereunder shall be paid on the dates
due, in immediately available funds, to the Administrative Agent (or to such
Issuing Bank, in the case of fees payable to it) for distribution, in the case
of Letter of Credit participation fees and commitment fees, to the Lenders. Fees
paid shall not be refundable under any circumstances.

                  SECTION 2.12. Interest. (a) The Loans comprising each ABR
Borrowing shall bear interest at the Alternate Base Rate plus the Applicable
Rate.

                  (b)      The Loans comprising each Eurodollar Borrowing shall
bear interest at the Adjusted LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Rate.

                  (c)      Swingline Loans shall bear interest at the Federal
Funds Effective Rate plus applicable Eurodollar Spread plus 15 basis points.

<PAGE>

                                                                              38

                  (d)      Notwithstanding the foregoing, if any principal of or
interest on any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon acceleration or
otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal of
any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section or (ii) in the case of any other amount, 2%
plus the rate applicable to ABR Loans as provided in paragraph (a) of this
Section.

                  (e)      Accrued interest on each Loan shall be payable in
arrears on each Interest Payment Date for such Loan and upon termination of the
Revolving Credit Commitments; provided that (i) interest accrued pursuant to
paragraph (c) of this Section shall be payable on demand, (ii) in the event of
any repayment or prepayment of any Loan (other than a prepayment of a Revolving
Loan prior to the end of the Availability Period) accrued interest on the
principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.

                  (f)      All interest hereunder shall be computed on the basis
of a year of 360 days, except that interest computed by reference to the
Alternate Base Rate at times when the Alternate Base Rate is based on the Prime
Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). The applicable Alternate
Base Rate, Federal Funds Effective Rate or Adjusted LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent demonstrable error.

                  SECTION 2.13. Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:

                  (a)      the Administrative Agent determines (which
         determination shall be conclusive absent demonstrable error) that
         adequate and reasonable means do not exist for ascertaining the
         Adjusted LIBO Rate for such Interest Period; or

                  (b)      the Administrative Agent is advised by the Required
         Lenders that the Adjusted LIBO Rate for such Interest Period will not
         adequately and fairly reflect the cost to such Lenders of making or
         maintaining their Loans included in such Borrowing for such Interest
         Period; or

                  (c)      the Administrative Agent is advised by one or more
         Lender(s), but less than the Required Lenders, that the Adjusted LIBO
         Rate for such Interest Period will not adequately and fairly reflect
         the cost to such Lender(s) of making or maintaining their Loans (or its
         Loan) included in such Borrowing for such Interest Period;

then, in the case of clause (a) or (b) above, the Administrative Agent shall
give notice thereof to the Borrower and the Lenders by telephone or telecopy as
promptly as practicable thereafter and, until the Administrative Agent notifies
the Borrower and the Lenders that the circumstances giving rise to such notice
no longer exist, (i) any Interest Election Request that requests the

<PAGE>

                                                                              39

conversion of any Borrowing to, or continuation of any Borrowing as, a
Eurodollar Borrowing shall be ineffective, and (ii) if any Borrowing Request
requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR
Borrowing; and in the case of clause (c) above, the Administrative Agent shall
give notice thereof to the Borrower and the Lenders by telephone or telecopy as
promptly as practicable thereafter and, until the Administrative Agent notifies
the Borrower and the Lenders that the circumstances giving rise to such notice
no longer exist, (i) any Interest Election Request that requests the conversion
of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing
shall be ineffective as to the Lender(s) giving notice under clause (c), (ii) if
any Borrowing Request requests a Eurodollar Borrowing, the Loans made by such
clause (c) Lender(s) as part of such Borrowing shall be made as ABR Loans and
(iii) the Interest Election Request or Borrowing Request shall be effective as
against the other Lenders and the affected Borrowings shall have all of the
characteristics specified in such Interest Election Request or Borrowing
Request, except that interest on the Loans made by the clause (c) Lenders shall
be computed at the ABR Rate.

                  SECTION 2.14. Increased Costs. (a) If any Change in Law shall:

                  (i)      impose, modify or deem applicable any reserve,
         special deposit or similar requirement against assets of, deposits with
         or for the account of, or credit extended by, any Lender (except any
         such reserve requirement reflected in the Adjusted LIBO Rate) or any
         Issuing Bank, or

                  (ii)     impose on any Lender or any Issuing Bank, or the
         London interbank market, any other condition affecting this Agreement
         or Eurodollar Loans made by such Lender or any Letter of Credit or
         participation therein;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or such
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or such
Issuing Bank, hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or such Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or such Issuing
Bank, as the case may be, for such additional costs incurred or reduction
suffered.

                  (b)      If any Lender or any Issuing Bank, determines that
any Change in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's capital or on the capital of such
Lender's or such Issuing Bank's, holding company, if any, as a consequence of
this Agreement or the Loans made by, or participations in Letters of Credit held
by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a
level below that which such Lender or such Issuing Bank, or such Lender's or
such Issuing Bank's, holding company could have achieved but for such Change in
Law (taking into consideration such Lender's or such Issuing Bank's policies and
the policies of such Lender's or such Issuing Bank's holding company with
respect to capital adequacy), then from time to time the Borrower will pay to
such Lender or such Issuing Bank, as the case may be, such additional amount or
amounts as will compensate such Lender or such Issuing Bank, or such Lender's or
such Issuing Bank's, holding company for any such reduction suffered.

<PAGE>

                                                                              40

                  (c)      A certificate of a Lender or an Issuing Bank, setting
forth the amount or amounts necessary to compensate such Lender or such Issuing
Bank, or its holding company, as the case may be, as specified in paragraph (a)
or (b) of this Section shall be delivered to the Borrower and shall be
conclusive absent demonstrable error. The Borrower shall pay such Lender or such
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.

                  (d)      Failure or delay on the part of any Lender or any
Issuing Bank, to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender's or such Issuing Bank's, right to demand
such compensation; provided that the Borrower shall not be required to
compensate a Lender or an Issuing Bank, pursuant to this Section for any
increased costs or reductions incurred more than 120 days prior to the date that
such Lender or such Issuing Bank, as the case may be, notifies the Borrower of
the Change in Law giving rise to such increased costs or reductions and of such
Lender's or such Issuing Bank's, intention to claim compensation therefor;
provided further that, if the Change in Law giving rise to such increased costs
or reductions is retroactive, then the 120-day period referred to above shall be
extended to include the period of retroactive effect thereof.

                  SECTION 2.15. Break Funding Payments. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under Section
2.10(b) and is revoked in accordance therewith), or (d) the assignment of any
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.18, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. In the case of a Eurodollar Loan, such
loss, cost or expense to any Lender shall be deemed to include an amount
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBO Rate that would have been applicable to
such Loan, for the period from the date of such event to the last day of the
then current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period for
such Loan), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Lender would
bid were it to bid, at the commencement of such period, for dollar deposits of a
comparable amount and period from other banks in the eurodollar market. A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section shall be delivered to the
Borrower and shall be conclusive absent demonstrable error. The Borrower shall
pay such Lender the amount shown as due on any such certificate within 10 days
after receipt thereof.

                  SECTION 2.16. Taxes. (a) Any and all payments by or on account
of any obligation of the Borrower hereunder shall be made free and clear of and
without deduction for any Indemnified Taxes or Other Taxes; provided that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions

<PAGE>

                                                                              41

applicable to additional sums payable under this Section) the Administrative
Agent, each Lender or each Issuing Bank (as the case may be) receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrower shall make such deductions and (iii) the Borrower shall pay the
full amount deducted to the relevant Governmental Authority in accordance with
applicable law.

                  (b)      In addition, the Borrower shall pay any Other Taxes
to the relevant Governmental Authority in accordance with applicable law.

                  (c)      The Borrower shall indemnify the Administrative
Agent, each Lender and each Issuing Bank, within 10 days after written demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
the Administrative Agent or such Lender or such Issuing Bank, as the case may
be, on or with respect to any payment by or on account of any obligation of the
Borrower hereunder or under any other Loan Document (including Indemnified Taxes
or Other Taxes imposed or asserted on or attributable to amounts payable under
this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender or an Issuing Bank, or by the
Administrative Agent on its own behalf or on behalf of a Lender or an Issuing
Bank, shall be conclusive absent demonstrable error.

                  (d)      As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
the Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.

                  (e)      Any Foreign Lender that is entitled to an exemption
from or reduction of withholding tax under the law of the jurisdiction in which
the Borrower is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement, shall deliver to the Borrower
(with a copy to the Administrative Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law or reasonably requested by the Borrower as will permit such
payments to be made without withholding or at a reduced rate.

                  SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing
of Set-offs. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements or of amounts payable under Section 2.14, 2.15 or 2.16, or
otherwise) prior to 12:00 noon, Memphis time, on the date when due, in
immediately available funds, without setoff or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 165 Madison Avenue,
Memphis, Tennessee 38103, except payments to be made directly to any Issuing
Bank or Swingline Lender as expressly provided herein and except that payments
pursuant to Sections 2.14, 2.15, 2.16 and 9.03 shall be made directly to the
Persons entitled thereto. The

<PAGE>

                                                                              42

Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.

                  (b)      If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards
payment of principal and unreimbursed LC Disbursements, then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed LC Disbursements then due to such parties.

                  (c)      If any Lender shall, by exercising any right of
set-off or counterclaim or otherwise, obtain payment in respect of any principal
of or interest on any of its Loans or participations in LC Disbursements or
Swingline Loans resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Loans or participations in LC
Disbursements or Swingline Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the Loans
or participations in LC Disbursements or Swingline Loans of other Lenders to the
extent necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans or participations in LC Disbursements
or Swingline Loans; provided that (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or participations in LC Disbursements or
Swingline Loans to any assignee or participant, other than to the Borrower or
any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). The Borrower consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against the Borrower rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the Borrower
in the amount of such participation.

                  (d)      Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Banks
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the Issuing Banks, as the case may be, the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders or each of
the Issuing

<PAGE>

                                                                              43

Banks, as the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or Issuing Bank
with interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of the Federal Funds Effective Rate and a rate determined
by the Administrative Agent in accordance with banking industry rules on
interbank compensation.

                  (e)      If any Lender shall fail to make any payment required
to be made by it pursuant to Section 2.04(c), 2.05(d) or (e), 2.06(b) or
2.17(d), then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are fully
paid.

                  SECTION 2.18. Mitigation Obligations; Replacement of Lenders.
(a) If any Lender exercises its rights under Section 2.13(c) or requests
compensation under Section 2.14, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 2.16, then such Lender shall use reasonable
efforts to designate a different lending office for funding or booking its Loans
hereunder or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce the cost referred to in
Section 2.11(c) or amounts payable pursuant to Section 2.12 or 2.14, as the case
may be, in the future and (ii) would not subject such Lender to any unreimbursed
cost or expense and would not otherwise be disadvantageous to such Lender. The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any
Lender in connection with any such designation or assignment.

                  (b)      If any Lender exercises its rights under Section
2.13(c) or requests compensation under Section 2.14, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.16, or if any
Lender defaults in its obligation to fund Loans hereunder, then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent, which
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and (iii)
in the case of any such assignment resulting from an exercise of rights under
Section 2.13(c) or a claim for compensation under Section 2.14 or payments
required to be made pursuant to Section 2.16, such assignment will result in
elimination of the Section 2.13(c) rights on the part of the assignee or a
reduction in such compensation or payments. A Lender shall not be required to
make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Lender or otherwise, the circumstances entitling the Borrower to
require such assignment and delegation cease to apply.

<PAGE>

                                                                              44

                                  ARTICLE III

                         Representations and Warranties

                  The Borrower represents and warrants to the Lenders that:

                  SECTION 3.01. Organization; Powers.

                  (a)      The Borrower and each of its Subsidiaries is a
corporation, limited liability company, partnership, association or other
business entity duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required. The jurisdiction of organization of the Borrower and each of its
Subsidiaries existing on the Effective Date is indicated on Schedule 3.01.

                  (b)      As of the Effective Date, the Borrower owns the
direct and indirect interests in the Subsidiaries specified in Schedule 3.01.
The Borrower's record and beneficial ownership, direct and indirect, of each
Subsidiary is free from any material restriction, equity, security interest, or
other Lien except as set forth in Schedule 3.01.

                  SECTION 3.02. Authorization; Enforceability. The Transactions
are within the Borrower's and each Grantor's corporate powers and have been duly
authorized by all necessary corporate and, if required, stockholder action. This
Agreement and each of the other Loan Documents has been duly executed and
delivered by the Borrower and/or the Grantor executing the same and constitutes
a legal, valid and binding obligation of the Borrower, and/or each such Grantor,
enforceable in accordance with its respective terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors' rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.

                  SECTION 3.03. Governmental Approvals; No Conflicts. The
Transactions and the execution, delivery and performance of the Loan Documents
by the respective parties thereto (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental Authority,
except such as have been obtained or made and are in full force and effect, (b)
will not violate any applicable law or regulation or the charter, by-laws or
other organizational documents of the Borrower or any of its Subsidiaries or any
order of any Governmental Authority, (c) will not violate or result in a default
under any indenture, agreement or other instrument binding upon the Borrower or
any of its Subsidiaries or its assets, or give rise to a right thereunder to
require any payment to be made by the Borrower or any of its Subsidiaries, and
(d) will not result in the creation or imposition of any Lien on any asset of
the Borrower or any of its Subsidiaries except pursuant to the Loan Documents.

                  SECTION 3.04. Financial Condition; No Material Adverse Change.
(a) The Borrower has heretofore furnished to the Lenders its (i) audited
consolidated and unaudited consolidating balance sheet and statements of income,
stockholders equity and cash flows as of

<PAGE>

                                                                              45

and for the Fiscal Years ended December 31, 2001 and December 31, 2002, reported
on by PricewaterhouseCoopers LLP, independent public accountants, and (ii)
unaudited interim consolidated and consolidating financial statements, certified
by its chief financial officer, for each Fiscal Quarter ended after the date of
the latest applicable financial statements delivered pursuant to clause (i) of
this paragraph as to which such financial statements are available. Such
financial statements present fairly, in all material respects, the financial
position and results of operations and cash flows of the Borrower and its
Consolidated Subsidiaries as of such dates and for such periods in accordance
with GAAP, subject to year end audit adjustments and the absence of footnotes in
the case of the statements referred to in clause (ii) above.

                  (b)      Since December 31, 2002, there has been no material
adverse change in the business, assets, operations, prospects or condition,
financial or otherwise, of the Borrower and its Subsidiaries, taken as a whole.

                  SECTION 3.05. Properties. (a) The Borrower and each of its
Subsidiaries has good title to, or valid leasehold interests in, all its real
and personal property material to its business, free and clear of all Liens
except for the Liens set forth on Schedule 6.02, for Liens permitted by Section
6.02 and for minor defects in title that do not interfere with its ability to
conduct its business as currently conducted or to utilize such properties for
their intended purposes.

                  (b)      The Borrower and each of its Subsidiaries owns, or is
licensed to use, all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and the use thereof by the
Borrower and its Subsidiaries does not infringe upon the rights of any other
Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. No material claim has been asserted and is pending by any Person
challenging or questioning the use of any such intellectual property or the
validity or effectiveness of such intellectual property, nor does the Borrower
know of any valid basis for any such claim.

                  SECTION 3.06. Litigation and Environmental Matters. (a) There
are no actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened
against or affecting the Borrower or any of its Subsidiaries (i) as to which
there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect or (ii) that involve this
Agreement or the Transactions.

                  (b)      To the knowledge of the Borrower, the facilities and
properties owned, leased or operated by the Borrower and each of its
Subsidiaries (the "Properties") do not contain, and have not previously
contained, any Hazardous Materials in amounts or concentrations or under
circumstances that constitute or constituted a violation of, or could give rise
to liability under, any Environmental Law, except for such violation or
liability that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect..

                  (c)      The environmental audits regarding the real
properties which are part of the Merchant's Acquisition provided to the
Co-Administrative Agent pursuant to Section 4.01(j)

<PAGE>

                                                                              46

do not contain any finding that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.

                  (d)      Except with respect to any matters that, individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect, neither the Borrower nor any of its Subsidiaries (i) has failed
to comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) has
become subject to any Environmental Liability, (iii) has received notice of any
claim with respect to any Environmental Liability or (iv) knows of any basis for
any Environmental Liability.

                  SECTION 3.07. Compliance with Laws and Agreements. The
Borrower and each Subsidiary is in compliance with all laws, regulations and
orders of any Governmental Authority applicable to it or its property and all
indentures, agreements and other instruments binding upon it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. No Default
(determined after giving effect to this Agreement) has occurred and is
continuing.

                  SECTION 3.08. Investment and Holding Company Status. Neither
the Borrower nor any of its Subsidiaries is (a) an "investment company" or a
company "controlled" by an "investment company" as defined in, or subject to
regulation under, the Investment Company Act of 1940 or (b) a "holding company"
as defined in, or subject to regulation under, the Public Utility Holding
Company Act of 1935.

                  SECTION 3.09. Taxes. The Borrower and each of its Subsidiaries
has timely filed or caused to be filed all Tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have
been paid by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which the Borrower or such Subsidiary, as
applicable, has set aside on its books adequate reserves to the extent required
by GAAP or (b) to the extent that the failure to do so could not reasonably be
expected to result in a Material Adverse Effect.

                  SECTION 3.10. ERISA. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such ERISA
Events for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect. The present value of all
accumulated benefit obligations under each Plan (based on the assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did not, as
of the date of the most recent financial statements reflecting such amounts,
exceed by more than $2,000,000 the fair market value of the assets of such Plan,
and the present value of all accumulated benefit obligations of all underfunded
Plans (based on the assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed by more than $2,000,000 the
fair market value of the assets of all such underfunded Plans.

                  SECTION 3.11. Disclosure. The Borrower has disclosed to the
Lenders all agreements, instruments and corporate or other restrictions to which
it or any of its Subsidiaries, Merchant's, Incorporated or Merban, Inc. is
subject, and all other matters known to it, that, individually or in the
aggregate, could

<PAGE>

                                                                              47

reasonably be expected to result in a Material Adverse Effect. None of the
reports, financial statements, certificates or other information furnished by or
on behalf of the Borrower to the Administrative Agent or any Lender in
connection with the negotiation of this Agreement or delivered hereunder (as
modified or supplemented by other information so furnished) prior to the
Effective Date contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information, the Borrower represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.

                  SECTION 3.12. Margin Stock. Neither the Borrower nor any
Subsidiary is engaged principally, or as one of its important activities, in the
business of extending or arranging for the extension of credit for the purpose
of purchasing or carrying "margin securities" or "margin Stock" (as defined in
Regulations G and U issued by the Board). Neither the Borrower nor any
Subsidiary owns or intends to carry or purchase any "margin security" or "margin
Stock." Neither the Borrower nor any Subsidiary will use the proceeds of any
Loan to purchase or carry (or refinance any borrowings the proceeds of which
were used to purchase or carry) any "margin security" or "margin Stock." If
requested by any Lender or the Administrative Agent, the Borrower will furnish
to the Administrative Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U-1, as
applicable, referred to in Regulation U.

                  SECTION 3.13. Compliance with Conditions Precedent. The
Borrower and each Subsidiary has (a) executed and delivered to the
Co-Administrative Agent and the Lenders the documents described in Section 4.01
hereto; (b) obtained and delivered to the Co-Administrative Agent and the
Lenders the opinions of counsel described in Section 4.01 (b); and (c) otherwise
complied with all other conditions hereto.

                  SECTION 3.14. Labor Matters. There are no strikes, lockouts or
slowdowns against the Borrower or any Subsidiary pending or, to the knowledge of
the Borrower, threatened that could reasonably be expected to have a Material
Adverse Effect.

                  SECTION 3.15. Assets. Schedule 3.15 accurately describes the
name and registration number of all federally registered trademarks, tradenames
and service marks of the Borrower and its Subsidiaries as of the Effective Date.

                  SECTION 3.16. Security Documents. (a) The Guarantee and
Collateral Agreement is effective to create in favor of the Collateral Agent,
for the benefit of the Lenders, a legal, valid and enforceable security interest
in the Collateral described therein and proceeds thereof. In the case of the
Pledged Stock described in the Guarantee and Collateral Agreement, when stock
certificates representing such Pledged Stock are delivered to the Collateral
Agent, and in the case of the other Collateral described in the Guarantee and
Collateral Agreement, when financing statements and other filings specified on
Schedule 3.16(a) in appropriate form are filed in the offices specified on
Schedule 3.16(a), the Guarantee and Collateral Agreement shall constitute a
fully perfected Lien on, and security interest in, all right, title and interest
of the Borrower and the Subsidiaries in such Collateral and the proceeds
thereof, as security for the Obligations (as defined in the Guarantee and
Collateral Agreement), in each case prior and

<PAGE>

                                                                              48

superior in right to any other Person (except, in the case of Collateral other
than Pledged Stock, Liens permitted by Section 6.02).

                  (b)      Each Mortgage is effective to create in favor of the
Collateral Agent, for the benefit of the Lenders, a legal, valid and enforceable
Lien on the Mortgaged Property described therein and proceeds thereof, and when
the Mortgage is filed at the request of the Collateral Agent in the offices
specified on Schedule 3.16(b), each such Mortgage shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the Borrower and the Subsidiaries in the Mortgaged Property and the proceeds
thereof, as security for the Secured Indebtedness (as defined in the relevant
Mortgage), in each case prior and superior in right to any other Person.

                  SECTION 3.17. Solvency. The Borrower is, and after giving
effect to the Acquisition and the incurrence of all Indebtedness and obligations
being incurred in connection herewith and therewith will be and will continue to
be, Solvent.

                  SECTION 3.18. Certain Documents. The Borrower has delivered to
the Co-Administrative Agent a complete and correct copy of the Merchant's
Acquisition Documentation, including any amendments, supplements or
modifications with respect to any of the foregoing.

                  SECTION 3.19. Regulation H. No Mortgage encumbers improved
real property that is located in an area that has been identified by the
Secretary of Housing and Urban Development as an area having special flood
hazards and in which flood insurance has been made available under the National
Flood Insurance Act of 1968.

                                   ARTICLE IV

                                   Conditions

                  SECTION 4.01. Effective Date. The obligations of the Lenders
to make Loans and of each Issuing Bank to issue Letters of Credit hereunder
shall not become effective until the date on which each of the following
conditions is satisfied (or waived in accordance with Section 9.02):

                  (a)      The Co-Administrative Agent (or its counsel) shall
         have received from each party hereto either (i) a counterpart of this
         Agreement signed on behalf of such party or (ii) written evidence
         satisfactory to the Co-Administrative Agent (which may include telecopy
         transmission of a signed signature page of this Agreement) that such
         party has signed a counterpart of this Agreement.

                  (b)      The Co-Administrative Agent shall have received a
         favorable written opinion (addressed to the Co-Administrative Agent and
         the Lenders and dated the Effective Date) of Thompson Hine LLP, counsel
         for the Borrower, and other local counsel for Borrower or any
         Subsidiary, substantially in the form of Schedule 4.01(b), and covering
         such other matters relating to the Borrower, the Grantors, this
         Agreement and the other Loan Documents and the Transactions as the
         Required Lenders shall reasonably request. The Borrower hereby requests
         such counsel to deliver such opinion.

<PAGE>

                                                                              49

                  (c)      The Co-Administrative Agent shall have received such
         documents and certificates as the Co-Administrative Agent or its
         counsel may reasonably request relating to the organization, existence
         and good standing of the Borrower and the Grantors referred to in
         Section 4.01(f), the authorization of the Transactions and any other
         legal matters relating to the Borrower, such Grantors, this Agreement
         and the other Loan Documents and the Transactions, all in form and
         substance satisfactory to the Co-Administrative Agent and its counsel.

                  (d)      The Co-Administrative Agent shall have received a
         certificate, dated the Effective Date and signed by the President, a
         Vice President or a Financial Officer of the Borrower, confirming
         compliance with the conditions set forth in paragraphs (a) and (b) of
         Section 4.02.

                  (e)      The Administrative Agent, Book Manager, Lead
         Arranger, Co-Administrative Agent and each Lender shall have received
         all fees and other amounts due and payable on or prior to the Effective
         Date, including, to the extent invoiced, reimbursement or payment of
         all out-of-pocket expenses required to be reimbursed or paid by the
         Borrower hereunder.

                  (f)      The Co-Administrative Agent shall have received (i)
         the Guarantee and Collateral Agreement, executed and delivered by the
         Borrower and each Grantor, and (ii) an Intercreditor Agreement executed
         and delivered by the Lenders and Prudential.

                  (g)      The Collateral Agent shall have received a Mortgage
         on real property owned by the Borrower, located at 4770 Hickory Hill
         Road, Memphis, Tennessee, and containing an approximately 475,000
         square foot executive office and warehouse facility (the "Mortgaged
         Property") which Mortgage shall be perfected if requested by the
         Collateral Agent.

                  (h)      The Merchant's Acquisition shall have been
         consummated on terms and conditions set forth in the Merchant's
         Acquisition Documentation.

                  (i)      The Co-Administrative Agent shall have received
         satisfactory evidence that the Existing Credit Agreement shall have
         been terminated and all amounts owing thereunder shall have been paid
         in full.

                  (j)      The Co-Administrative Agent shall have received (i)
         copies of all existing environmental audits with respect to the real
         properties which are part of the Merchant's Acquisition and any other
         Person the acquisition of which is to be financed with proceeds from
         the Tranche B Term Loans and (ii) any other existing environmental
         audits requested by the Arranger.

                  (k)      The Co-Administrative Agent shall have received the
         results of a recent lien search in each of the jurisdictions where
         assets of the Borrower and each Subsidiary (including Merchant's,
         Incorporated and its subsidiary) are located, and such search shall
         reveal no liens on any of the assets of the Borrower except for liens
         permitted by Section 6.02 or discharged on or prior to the Closing Date
         pursuant to documentation satisfactory to the Administrative Agent.

<PAGE>

                                                                              50

                  (l)      The Collateral Agent shall have received (i) the
         certificates representing the shares of Capital Stock pledged pursuant
         to the Guarantee and Collateral Agreement, together with an undated
         stock power for each such certificate executed in blank by a duly
         authorized officer of the pledgor thereof, and (ii) each promissory
         note (if any) pledged to the Collateral Agent pursuant to the Guarantee
         and Collateral Agreement endorsed (without recourse) in blank (or
         accompanied by an executed transfer form in blank) by the pledgor
         thereof.

                  (m)      The Borrower and Prudential shall have executed the
         Additional Note Agreement in substantially the same form as the most
         recent draft thereof distributed to the Lenders.

                  (n)      The Existing Note Agreement between the Borrower and
         Prudential shall have been amended in substantially the same form as
         the most recent draft of the Note Agreement for the Additional
         Prudential Notes distributed to the Lenders.

The Co-Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans and of the Issuing
Banks to issue Letters of Credit hereunder shall not become effective unless
each of the foregoing conditions is satisfied (or waived pursuant to Section
9.02) at or prior to 3:00 p.m., Memphis, Tennessee time, on April 30, 2003 (and,
in the event such conditions are not so satisfied or waived, the Commitments
shall terminate at such time).

                  SECTION 4.02. Each Credit Event. The obligation of each Lender
to make a Loan on the occasion of any Borrowing and of each Issuing Bank to
issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:

                  (a)      The representations and warranties of the Borrower
         set forth in this Agreement shall be true and correct on and as of the
         date of such Borrowing, or the date of issuance, amendment, renewal or
         extension of such Letter of Credit, as applicable, as if made on such
         date.

                  (b)      At the time of and immediately after giving effect to
         such Borrowing, or the issuance, amendment, renewal or extension of
         such Letter of Credit, as applicable, no Default shall have occurred
         and be continuing.

Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a) and
(b) of this Section.

                                   ARTICLE V

                              Affirmative Covenants

                  Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full, and all Letters

<PAGE>

                                                                              51

of Credit shall have expired or terminated and all LC Disbursements shall have
been reimbursed, the Borrower covenants and agrees with the Lenders that:

                  SECTION 5.01. Punctual Payment. The Borrower will punctually
pay or cause to be paid the principal and interest due in respect of each
Borrowing according to the terms hereof and the Borrower will punctually pay or
cause to be paid the commitment, Letter of Credit participation and other fees
for which it is responsible pursuant to Section 2.11 hereof.

                  SECTION 5.02. Financial Statements and Other Information. The
Borrower will furnish to each Lender:

                  (a)      within 90 days after the end of each Fiscal Year of
         the Borrower, its audited consolidated balance sheet and related
         statement of operations, stockholders' equity and cash flows as of the
         end of and for such year, setting forth in each case in comparative
         form the figures for the previous Fiscal Year, all reported on by
         PricewaterhouseCoopers LLP or other independent public accountants of
         recognized national standing (without a "going concern" or like
         qualification or exception and without any qualification or exception
         as to the scope of such, audit) to the effect that such consolidated
         financial statements present fairly in all material respects the
         financial condition and results of operations of the Borrower and its
         Consolidated Subsidiaries on a consolidated basis in accordance with
         GAAP consistently applied; and within 90 days after the end of each
         Fiscal Year of the Borrower, its unaudited consolidating balance sheets
         and related statements of operations as of the end of and for such
         year, all certified by one of its Financial Officers as presenting
         fairly in all material respects the financial condition and results of
         operations of each of the Borrower's Consolidated Subsidiaries in
         accordance with GAAP consistently applied;

                  (b)      within 45 days after the end of each of the first
         three Fiscal Quarters of each Fiscal Year of the Borrower, (i) its
         consolidated balance sheets and related statements of operations,
         stockholders' equity and cash flows as of the end of and for such
         Fiscal Quarter and the then elapsed portion of the Fiscal Year, setting
         forth in each case in comparative form the figures for the
         corresponding period and quarter of the previous Fiscal Year, and (ii)
         its consolidating balance sheets and related statements of operations
         as of the end of and for such Fiscal Quarter and the then elapsed
         portion of the Fiscal Year, all certified by one of its Financial
         Officers as presenting fairly in all material respects the financial
         condition and results of operations of the Borrower and its
         Consolidated Subsidiaries on a consolidated and consolidating basis in
         accordance with GAAP consistently applied, subject to normal year-end
         audit adjustments and the absence of footnotes;

                  (c)      concurrently with any delivery of financial
         statements under clause (a) or (b) above, a certificate of a Financial
         Officer of the Borrower (i) certifying as to whether a Default has
         occurred and, if a Default has occurred, specifying the details thereof
         and any action taken or proposed to be taken with respect thereto, (ii)
         setting forth reasonably detailed calculations demonstrating compliance
         with Sections 6.08 through 6.12 and (iii) stating whether any change in
         GAAP or in the application thereof has occurred since the date of the
         audited financial statements referred to in Section 3.04 and, if any
         such

<PAGE>

                                                                              52

         change has occurred, specifying the effect of such change on the
         financial statements accompanying such certificate;

                  (d)      promptly after the same become publicly available,
         copies of all periodic and other reports, proxy statements and other
         materials filed by the Borrower or any Subsidiary with the Securities
         and Exchange Commission, or any Governmental Authority succeeding to
         any or all of the functions of said Commission, or with any national
         securities exchange, or distributed by the Borrower to its shareholders
         generally, as the case may be; and

                  (e)      promptly following any request therefor, such other
         information regarding the operations, business affairs and financial
         condition of the Borrower or any Subsidiary, or compliance with the
         terms of this Agreement and the other Loan Documents, as the
         Administrative Agent or any Lender may reasonably request.

                  SECTION 5.03. Notices of Material Events. The Borrower will
furnish to the Co-Administrative Agent and each Lender prompt written notice of
the following:

                  (a)      the occurrence of any Default;

                  (b)      the filing or commencement of any action, suit or
         proceeding by or before any arbitrator or Governmental Authority
         against or affecting the Borrower or any Subsidiary or Affiliate
         thereof that, if adversely determined, could reasonably be expected to
         result in a Material Adverse Effect;

                  (c)      the occurrence of any ERISA Event that, alone or
         together with any other ERISA Events that have occurred, could
         reasonably be expected to result in liability of the Borrower and its
         Subsidiaries in an aggregate amount exceeding $2,000,000; and

                  (d)      any other development that results in, or could
         reasonably be expected to result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.

                  SECTION 5.04. Existence; Conduct of Business. The Borrower
will, and will cause each of its Subsidiaries to, do or cause to be done all
things necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
any merger, consolidation, liquidation or dissolution permitted under Section
6.03.

                  SECTION 5.05. Payment of Obligations. The Borrower will, and
will cause each of its Subsidiaries to, pay its obligations, including Tax
liabilities, that, if not paid, could result in a Material Adverse Effect before
the same shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith by appropriate proceedings, (b)
the Borrower or such Subsidiary has set aside on its books adequate reserves
with respect thereto

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                                                                              53

in accordance with GAAP and (c) the failure to make payment pending such contest
could not reasonably be expected to result in a Material Adverse Effect.

                  SECTION 5.06. Maintenance of Properties; Insurance. The
Borrower will, and will cause each of its Subsidiaries to, (a) keep and maintain
all property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted, and (b) maintain, with financially
sound and reputable insurance companies, insurance in such amounts and against
such risks as are customarily maintained by companies engaged in the same or
similar businesses operating in the same or similar locations.

                  SECTION 5.07. Books and Records; Inspection Rights. The
Borrower will, and will cause each of its Subsidiaries to, keep proper books of
record and account in which full, true and correct entries are made of all
dealings and transactions in relation to its business and activities. The
Borrower will, and will cause each of its Subsidiaries to, permit any
representatives designated by the Co-Administrative Agent or any Lender, upon
reasonable prior notice, to visit and inspect its properties, to examine and
make extracts from its books and records, and to discuss its affairs, finances
and condition with its officers and independent accountants, all at such
reasonable times and as often as reasonably requested.

                  SECTION 5.08. Compliance with Laws. The Borrower will, and
will cause each of its Subsidiaries to, comply with all laws, rules, regulations
and orders of any Governmental Authority applicable to it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

                  SECTION 5.09. Use of Proceeds. The proceeds of the Term Loans
will be used for the Refinancing, the Merchant's Acquisition and other
Acceptable Acquisitions, and the proceeds of Revolving Loans will be used for
the Refinancing and thereafter for general corporate purposes of the Borrower
and its Subsidiaries. No part of the proceeds of any Loan will be used, whether
directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations U and X. Letters of Credit will
be used only to support general corporate purposes.

                  SECTION 5.10. Intercompany Loans/Payments. The Borrower agrees
with the Lenders that (i) any payments made by a Guarantor in reduction of its
obligation under the Guarantee executed by it, shall reduce dollar for dollar
its total obligation to the Borrower for repayment of any Intercompany Loans
owed to the Borrower, (ii) it will require that any payments made by a Guarantor
that is an indirect Wholly-Owned Subsidiary of the Borrower, in reduction of its
obligation under the Guarantee executed by it, shall reduce dollar for dollar
its total obligation for repayment of any Intercompany Loans owed to another
Guarantor and (iii) except as set forth in Schedule 5.10, neither it nor any
Wholly-Owned Subsidiary will demand, enforce or accept any payments on account
of any Intercompany Loans owed to the Borrower by any Guarantor at a time when
such Guarantor is insolvent or if such payments could reasonably be expected to
render such Guarantor insolvent, to leave it with unreasonably small capital for
the business in which it is engaged and in which it intends to engage, or to
leave it unable to pay its other Indebtedness as the same matures.

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                                                                              54

                  SECTION 5.11. Subsidiary Guarantees and Collateral. (a) With
respect to any new Subsidiary (other than an Excluded Foreign Subsidiary)
created or acquired after the Closing Date by the Borrower or any Subsidiary
(which, for the purposes of this paragraph (a), shall include any existing
Subsidiary that ceases to be an Excluded Foreign Subsidiary), the Borrower will
promptly (i) execute and deliver to the Collateral Agent such amendments to the
Guarantee and Collateral Agreement as the Collateral Agent deems necessary or
advisable to grant to the Collateral Agent, for the benefit of the Lenders, a
perfected first priority security interest in the Capital Stock of such new
Subsidiary that is owned by the Borrower or any Subsidiary, (ii) deliver to the
Collateral Agent the certificates representing such Capital Stock, together with
undated stock powers, in blank, executed and delivered by a duly authorized
officer of the Borrower or the relevant Subsidiary, (iii) cause such new
Subsidiary (A) to become a party to the Guarantee and Collateral Agreement and
(B) to take such actions necessary or advisable to grant to the Collateral Agent
for the benefit of the Lenders a perfected first priority security interest in
the Collateral described in the Guarantee and Collateral Agreement with respect
to such new Subsidiary, including the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Guarantee
and Collateral Agreement or by law or as may be requested by the Collateral
Agent, and (iv) if requested by the Collateral Agent, deliver to the Collateral
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to the
Collateral Agent.

                  (b)      With respect to any new Excluded Foreign Subsidiary
created or acquired after the Closing Date by the Borrower or any Subsidiary
(other than by any Subsidiary that is an Excluded Foreign Subsidiary), the
Borrower will promptly (i) execute and deliver to the Collateral Agent such
amendments to the Guarantee and Collateral Agreement as the Collateral Agent
deems necessary or advisable to grant to the Collateral Agent, for the benefit
of the Lenders, a perfected first priority security interest in the Capital
Stock of such new Subsidiary that is owned by the Borrower or such Subsidiary
(provided that in no event shall more than 66% of the total outstanding voting
Capital Stock of any such new Subsidiary be required to be so pledged), (ii)
deliver to the Collateral Agent the certificates representing such Capital
Stock, together with undated stock powers, in blank, executed and delivered by a
duly authorized officer of the Borrower or the relevant Subsidiary, and take
such other action as may be necessary or, in the opinion of the Collateral
Agent, desirable to perfect the Collateral Agent's security interest therein,
and (iii) if requested by the Collateral Agent, deliver to the Collateral Agent
legal opinions relating to the matters described above, which opinions shall be
in form and substance, and from counsel, reasonably satisfactory to the
Collateral Agent.

                  SECTION 5.12. Environmental Laws. (a) The Borrower will, and
will cause each of its Subsidiaries to, comply in all material respects with,
and ensure compliance in all material respects by all tenants and subtenants, if
any, with, all applicable Environmental Laws, and obtain and comply in all
material respects with and maintain, and ensure that all tenants and subtenants
obtain and comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws, except where the failure to do so, individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.

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                                                                              55

                  (b)      The Borrower will, and will cause each of its
Subsidiaries to, conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws, except where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.

                  SECTION 5.13. Additional Collateral, etc. (a) With respect
to any fee interest in any real property having a value (together with
improvements thereof) of at least $10,000,000 acquired after the Closing Date by
the Borrower or any of its Subsidiaries (other than any such real property
subject to a Lien expressly permitted by Section 6.02(d)), if requested by the
Collateral Agent, the Borrower shall, or shall cause its Subsidiary to, promptly
(i) execute and deliver a first priority Mortgage, in favor of the Collateral
Agent, for the benefit of the Lenders, covering such real property, (ii) provide
the Lenders with (x) title and extended coverage insurance covering such real
property in an amount at least equal to the purchase price of such real property
(or such other amount as shall be reasonably specified by the Collateral Agent)
as well as a current ALTA survey thereof, together with a surveyor's certificate
and (y) any consents or estoppels reasonably deemed necessary or advisable by
the Collateral Agent in connection with such Mortgage, each of the foregoing in
form and substance reasonably satisfactory to the Collateral Agent and (iii)
deliver to the Collateral Agent legal opinions relating to the matters described
above, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Collateral Agent.

                  (b)      With respect to any property acquired after the
Closing Date by any of the Borrower or its Subsidiaries (other than (x) any
property described in paragraph (a) or Section 5.11, (y) any property subject to
a Lien expressly permitted by Section 6.02(d) and (z) properly acquired by any
Excluded Foreign Subsidiary) as to which the Collateral Agent, for the benefit
of the Lenders, does not have a perfected Lien, if requested by the Collateral
Agent, the Borrower shall promptly (i) execute and deliver to the Collateral
Agent such amendments to the Guarantee and Collateral Agreement or such other
documents as the Collateral Agent deems necessary or advisable to grant to the
Collateral Agent, for the benefit of the Lenders, a security interest in such
property and (ii) take all actions necessary or advisable to grant to the
Collateral Agent, for the benefit of the Lenders, a perfected first priority
security interest in such property, including the filing of Uniform Commercial
Code financing statements in such jurisdictions as may be required by the
Guarantee and Collateral Agreement or by law or as may be requested by the
Collateral Agent.

                  SECTION 5.14. Title Insurance, etc. (a) If requested by the
Collateral Agent, the Borrower will provide to the Collateral Agent and the
title insurance company issuing the policy referred to in paragraph (b) below
(the "Title Insurance Company") maps or plats of an as-built survey of the sites
of the Mortgaged Properties, and such maps or plats shall be certified to the
Collateral Agent and the Title Insurance Company in a manner satisfactory to
them, dated a date satisfactory to the Collateral Agent and the Title Insurance
Company by an independent professional licensed land surveyor satisfactory to
the Collateral Agent and the Title Insurance Company, which maps or plats and
the surveys on which they are based shall be made in accordance with the Minimum
Standard Detail Requirements for Land Title Surveys jointly established and
adopted by the American Land Title Association and the American Congress on

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                                                                              56

Surveying and Mapping in 1992, and, without limiting the generality of the
foregoing, there shall be surveyed and shown on such maps, plats or surveys the
following: (A) the locations on such sites of all the buildings, structures and
other improvements and the established building setback lines; (B) the lines of
streets abutting the sites and width thereof; (C) all access and other easements
appurtenant to the sites; (D) all roadways, paths, driveways, easements,
encroachments and overhanging projections and similar encumbrances affecting the
site, whether recorded, apparent from a physical inspection of the sites or
otherwise known to the surveyor; (E) any encroachments on any adjoining property
by the building structures and improvements on the sites; (F) if the site is
described as being on a filed map, a legend relating the survey to said map; and
(G) the flood zone designations, if any, in which any Mortgaged Property is
located.

                  (b)      If requested by the Collateral Agent, the Borrower
will provide to the Collateral Agent in respect of each Mortgaged Property a
mortgagee's title insurance policy (or policies) or marked up unconditional
binder for such insurance. Each such policy shall (A) be in an amount
satisfactory to the Collateral Agent; (B) be issued at ordinary rates; (C)
insure that the Mortgage insured thereby creates a valid first Lien on such
Property free and clear of all defects and encumbrances, except as disclosed
therein; (D) name the Collateral Agent for the benefit of the Lenders as the
insured thereunder; (E) be in the form of ALTA Loan Policy - 1970 (Amended
10/17/70 and 10/17/84) (or equivalent policies); (F) contain such endorsements
and affirmative coverage as the Collateral Agent may reasonably request and (G)
be issued by title companies satisfactory to the Collateral Agent (including any
such title companies acting as co-insurers or reinsurers, at the option of the
Collateral Agent). The Collateral Agent shall have received evidence
satisfactory to it that all premiums in respect of each such policy, all charges
for mortgage recording tax, and all related expenses, if any, have been paid.

                  (c)      If requested by the Collateral Agent, the Borrower
will provide to the Collateral Agent (A) a policy of flood insurance that (1)
covers any parcel of improved real property that is encumbered by any Mortgage
(2) is written in an amount not less than the outstanding principal amount of
the indebtedness secured by such Mortgage that is reasonably allocable to such
real property or the maximum limit of coverage made available with respect to
the particular type of property under the National Flood Insurance Act of 1968,
whichever is less, and (3) has a term ending not later than the maturity of the
Indebtedness secured by such Mortgage and (B) confirmation that the Borrower has
received the notice required pursuant to Section 208(e)(3) of Regulation H of
the Board.

                                   ARTICLE VI

                               Negative Covenants

                  Until the Commitments have expired or terminated and the
principal of and interest on each Loan and all fees payable hereunder have been
paid in full, and all Letters of Credit have expired or been terminated and all
LC Disbursements shall have been reimbursed, the Borrower covenants and agrees
with the Lenders that:

                  SECTION 6.01. Indebtedness. The Borrower will not, nor will it
permit any of its Subsidiaries to, create, incur, assume or permit to exist any
Indebtedness, except:

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                                                                              57

                  (a)      Indebtedness created hereunder, and Guarantees
         executed pursuant to this Agreement;

                  (b)      Indebtedness and Guarantees existing on the date
         hereof and set forth in Schedule 6.01 and extensions, renewals and
         replacements of any such Indebtedness that do not increase the
         outstanding principal amount thereof over the amount set forth on
         Schedule 6.01;

                  (c)      Indebtedness owed to the Borrower or to any
         Wholly-Owned Subsidiary by any Wholly-Owned Subsidiary, that in each
         case is permitted under Sections 6.04(c), and Indebtedness owed by the
         Borrower or by any Wholly-Owned Subsidiary to any Wholly-Owned
         Subsidiary, that in each case is permitted under Section 6.04(h);

                  (d)      Guarantees and Indebtedness arising in connection
         with any Synthetic Lease, in an aggregate principal amount not
         exceeding $9,000,000 or in connection with the SunTrust Sale and
         Leaseback in an aggregate principal amount not exceeding $12,000,000;

                  (e)      Guarantee obligations entered into by Big O Tires,
         Inc. or its Subsidiaries on behalf of its franchisees, other than
         Guarantees related to any Synthetic Lease and those existing Guarantee
         obligations listed on Schedule 6.01(e), provided that the aggregate
         principal amount of such guaranteed obligations arising after the
         Effective Date plus the aggregate principal amount of loans permitted
         under Section 6.04(i) at no time exceeds $20,000,000;

                  (f)      Indebtedness of any Subsidiary which becomes such as
         a result of an Acceptable Acquisition, including such Indebtedness that
         is assumed or becomes the subject of a Guarantee, but not any
         extensions, renewals or replacements thereof; provided, that any such
         Indebtedness is not created in contemplation of or in connection with
         such Acceptable Acquisition;

                  (g)      Guarantees by any of the Borrower or any Wholly-Owned
         Subsidiary of Indebtedness of any Wholly-Owned Subsidiary, provided
         such Subsidiary Indebtedness is permitted pursuant to this Section;

                  (h)      other Indebtedness which does not have an aggregate
         principal amount exceeding $25,000,000 at any time outstanding;

                  (i)      Guarantee obligations entered into by (x) the
         Borrower or any Wholly-Owned Subsidiary, of obligations of any
         Wholly-Owned Subsidiary to Persons other than their Affiliates, which
         obligations are incurred by them in the ordinary course of business and
         do not constitute Indebtedness, such as trade accounts payable,
         customer advances, accrued expenses and lease payments that do not
         constitute Indebtedness, and (y) the Borrower or any Wholly-Owned
         Subsidiary, of obligations of Persons other than Subsidiaries and their
         Affiliates, provided that the aggregate principal amount of the
         guaranteed obligations under this clause (y) plus the aggregate amount
         of the investments permitted under Section 6.04(d) at no time exceeds
         $20,000,000; and

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                                                                              58

                  (j)      Indebtedness owed by the Borrower to the sellers of
         Merchant's, Incorporated and its subsidiary evidenced by the promissory
         note pursuant to Section 3.03(a)(i) of the Merchant's Acquisition
         Agreement, provided that the proceeds from the Additional Prudential
         Notes shall be used to pay off the Indebtedness under such promissory
         note 15 days after the closing date of the Merchant's Acquisition.

                  SECTION 6.02. Liens. The Borrower will not, nor will it permit
any of its Subsidiaries to, create, incur, assume or permit to exist any Lien on
any property or asset now owned or hereafter acquired by it, or assign or sell
any income or revenues (including accounts receivable) or rights in respect of
any thereof, except:

                  (a)      Permitted Encumbrances;

                  (b)      any Lien on any property or asset of the Borrower or
         any Subsidiary existing on the date hereof and set forth in Schedule
         6.02, provided that , if such Lien is not released within sixty days
         after the Effective Date, (i) such Lien shall not apply to any other
         property or asset of the Borrower or any Subsidiary and (ii) such Lien
         shall secure only those obligations which it secures on the date hereof
         and extensions, renewals and replacements thereof that do not increase
         the outstanding principal amount thereof over the amount set forth on
         Schedule 6.02;

                  (c)      any Lien, other than a Lien securing a Synthetic
         Lease permitted under Section 6.01(d), existing on any property or
         asset prior to the acquisition thereof by the Borrower or any
         Subsidiary or existing on any property or asset of any Person that
         becomes a Subsidiary after the date hereof prior to the time such
         Person becomes a Subsidiary; provided that (i) such Lien is not created
         in contemplation of or in connection with such acquisition or such
         Person becoming a Subsidiary, as the case may be, (ii) such Lien shall
         not apply to any other property or assets of the Borrower or any
         Subsidiary; (iii) such Lien secures Indebtedness permitted by Section
         6.01(h) and (iv) such Lien shall secure only those obligations which it
         secures on the date of such acquisition or the date such Person becomes
         a Subsidiary, as the case may be;

                  (d)      Liens, other than Liens securing any Synthetic Lease
         permitted under Section 6.01(d), on fixed or capital assets acquired by
         the Borrower or any Subsidiary; provided that (i) such Liens secure
         Indebtedness permitted by Section 6.01(h), (ii) such Liens and the
         Indebtedness secured thereby are incurred prior to such acquisition or
         simultaneously therewith, (iii) the Indebtedness secured thereby does
         not exceed 100% of the cost of acquiring such fixed or capital assets,
         (iv) such security interests shall not apply to any other property or
         assets of the Borrower or any Subsidiary; and (v) the aggregate
         Indebtedness secured by all such Liens does not exceed $5,000,000;

                  (e)      Liens securing any Synthetic Lease or arising in
         connection with the SunTrust Sale and Leaseback permitted under Section
         6.01(d); and

                  (f)      a security interest granted by Tire Kingdom, Inc. to
         Michelin Tire Corporation, as secured party, with respect to all
         inventory previously and hereafter purchased from Michelin Tire
         Corporation by Tire Kingdom, Inc. and all proceeds

<PAGE>

                                                                              59

         thereof, provided that the aggregate amount of obligations secured
         thereby at no time exceeds $30,000,000.

                  SECTION 6.03. Fundamental Changes. (a) The Borrower will not,
nor will it permit any of its Subsidiaries to, merge into or with or consolidate
with any other Person, or permit any other Person to merge into or with it or
consolidate with it, or sell, transfer, lease or otherwise dispose of (in one
transaction or in a series of transactions) any of the stock of its Subsidiaries
(in each case, whether now owned or hereafter acquired), or liquidate or
dissolve, except that, if at the time thereof and immediately after giving
effect thereto no Default shall have occurred and be continuing (i) any
Wholly-Owned Subsidiary may merge into the Borrower or into another Wholly-Owned
Subsidiary; (ii) any Wholly-Owned Subsidiary may sell, transfer, lease or
otherwise dispose of any portion of its assets to the Borrower or to another
Wholly-Owned Subsidiary; (iii) any Wholly-Owned Subsidiary may liquidate or
dissolve if the Borrower determines in good faith that such liquidation or
dissolution is in the best interests of the Borrower and is not materially
disadvantageous to the Lenders; (iv) Acceptable Acquisitions shall be permitted;
and (v) the disposal of Northern States Tire, Inc. shall be permitted, whether
by sale of assets or stock, or by merger or consolidation.

                  (b) The Borrower will not, nor will it permit any of its
Subsidiaries to, engage to any material extent in any business not reasonably
related to (i) the distribution of tires and other products in the automotive
replacement market, (ii) providing financing to the Borrower and its other
Subsidiaries, or (iii) owning and licensing intellectual property used by the
Borrower or its other Subsidiaries.

                  SECTION 6.04. Investments, Loans, Advances, Guarantees and
Acquisitions. The Borrower will not, nor will it permit any of its Subsidiaries
to, purchase, hold or acquire (including pursuant to any merger with any Person
that was not a Wholly-Owned Subsidiary prior to such merger) any capital stock,
evidences of Indebtedness or other securities (including any option, warrant or
other right to acquire any of the foregoing) of, make or permit to exist any
loans or advances to, Guarantee any obligations of, or make or permit to exist
any investment or any other interest in, any other Person, or purchase or
otherwise acquire (in one transaction or a series of transactions) any assets of
any other Person constituting a business unit, except:

                  (a)      Permitted Investments;

                  (b)      the Merchant's Acquisition; capital investments in
any Subsidiary (provided that the Subsidiary is in existence on the Effective
Date or becomes a Subsidiary at any time after the Effective Date in a manner
which complies with all other provisions of this Agreement without giving effect
to this clause (b)); and other investments and loans as otherwise described in
Schedule 6.04(b);

                  (c)      loans or advances made by the Borrower or any
Wholly-Owned Subsidiary to any Wholly-Owned Subsidiary;

                  (d)      loans and advances to, purchases of equity interests
in and contributions to the capital of Joint Ventures and other Persons, not
otherwise permitted pursuant to this Section, provided that the aggregate amount
of such investments, plus the aggregate amount of the

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                                                                              60

obligations guaranteed pursuant to Section 6.01(i)(y), shall not exceed
$20,000,000 at any one time; (Joint Venture profits and losses that are passed
through to its equity holders shall not be included in the calculation of the
aggregate amount of such investments);

                  (e)      investments in evidences of Indebtedness representing
amounts formerly constituting accounts receivable owed to the Borrower or any
Subsidiary in the ordinary course of business;

                  (f)      Guarantees permitted under Section 6.01;

                  (g)      Acceptable Acquisitions. "Acceptable Acquisition"
means any separate individual Acquisition completed after the date of this
Agreement which has been either (a) approved by the Board of Directors of the
corporation, or the comparable or appropriate body of any other Person, which is
the subject of such Acquisition or (b) recommended by such Board to the
shareholders of such corporation, or by such other body to the equity holders of
such other Person, and in each case (i) the Acquisition target is a Person which
is engaged in the replacement tire industry, (ii) the aggregate consideration
for the Acquisitions shall not exceed $40,000,000 in any one calendar year,
(iii) the aggregate consideration for all Acquisitions completed after the date
of this Agreement shall not exceed $75,000,000, provided that this amount shall
be increased on an annual basis by 25% of the Borrower's Consolidated Net Income
for each completed fiscal year commencing with its 2003 fiscal year and (iv) the
Acquisition is made under circumstances in which no Default or Event of Default
will either exist or result therefrom, and in which pro forma financial
statements and projections including the Borrower, its Subsidiaries and the
Person and/or assets to be acquired, covering the most recent 12 month period
for which financial statements are available and the twelve months following the
Acquisition, would show that no Default or Event of Default will result from the
Acquisition and that Borrower will have unused Revolving Credit Commitments upon
consummation of such Acquisition aggregating not less than $20,000,000. As used
in this paragraph, "Acquisition" means any transaction pursuant to which the
Borrower or any of its Wholly-Owned Subsidiaries (a) acquires all of the
outstanding equity securities of any Person other than the Borrower or any
Person which is then a Wholly-Owned Subsidiary of the Borrower, or (b) otherwise
makes any Person a Wholly-Owned Subsidiary of the Borrower, in any case pursuant
to a merger, purchase of assets or any reorganization, or (c) purchases all or
substantially all of the business or assets of any Person other than a
Wholly-Owned Subsidiary of the Borrower or of any business unit or line of
business of any such Persons;

                  (h)      Intercompany Loans made to the Borrower or any
Wholly-Owned Subsidiary by any Wholly-Owned Subsidiary; and

                  (i)      loans by Big O Tires, Inc. or its Wholly-Owned
Subsidiaries to Big O franchisees, provided that the aggregate principal amount
of such loans arising after the Effective Date plus the aggregate amount of the
obligations guaranteed pursuant to Section 6.01(e) at no time exceeds
$20,000,000. Investments in evidences of Indebtedness permitted under Section
6.04(e) and Big O franchisee loans that have been sold to third parties shall be
excluded from the loans and obligations required to be within the $20,000,000
limit.

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                                                                              61

                  SECTION 6.05. Hedging Agreements. The Borrower will not, nor
will it permit any of its Subsidiaries to, enter into any Hedging Agreement,
other than Hedging Agreements entered into in the ordinary course of business to
hedge or mitigate risks to which the Borrower or such Subsidiary is exposed in
the conduct of its business or the management of its liabilities.

                  SECTION 6.06. Transactions with Affiliates. The Borrower will
not, nor will it permit any of its Subsidiaries to, enter into any transaction
(including, without limitation, the purchase or sale of any property or service)
with or make any payment or transfer to, any of its Affiliates except in the
ordinary course of business and pursuant to the reasonable requirements of the
Borrower's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a comparable arms-length transaction; provided that
the foregoing shall not apply to transactions (i) between the Borrower and any
Wholly-Owned Subsidiary, as long as such transactions do not violate Section
6.04; or (ii) if such transactions occur in the ordinary course of business
consistent with past practices of the Borrower and/or Subsidiary, (x)
transactions between the Borrower or any Wholly-Owned Subsidiary and TBC de
Mexico or (xx) transactions between Big O Tires, Inc. or any of its Subsidiaries
and any Joint Venture established by Big O Tires, Inc. or any of its
Subsidiaries in the ordinary course of business, the entire investment in which
is permitted under Section 6.04(d).

                  SECTION 6.07. Restrictive Agreements. The Borrower will not,
nor will it permit any of its Subsidiaries to, directly or indirectly, enter
into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (a) the ability of the
Borrower or any Subsidiary to create, incur or permit to exist any Lien upon any
of its property or assets, or (b) the ability of any Subsidiary to pay dividends
or other distributions with respect to any shares of its capital stock or to
make or repay loans or advances to the Borrower or any other Subsidiary or to
Guarantee Indebtedness of the Borrower or any other Subsidiary; provided that
(i) the foregoing shall not apply to restrictions and conditions imposed by law
or by this Agreement, (ii) the foregoing shall not apply to restrictions and
conditions identified on Schedule 6.07 (but shall apply to any extension or
renewal of, or any amendment or modification expanding the scope of, any such
restriction or condition), (iii) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the sale of a
Subsidiary pending such sale, provided such restrictions and conditions apply
only to the Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness and (v) clause (a) of the foregoing shall not
apply to customary provisions in leases restricting the assignment thereof.

                  SECTION 6.08. Fixed Charge Coverage Ratio. The Borrower will
not permit the Fixed Charge Coverage Ratio as of the last day of any Fiscal
Quarter of the Borrower to be less than the amount set forth in the following
table. For purposes of this Section, "Fixed Charge Coverage Ratio" means as of
the last day of any Fiscal Quarter of the Borrower, the ratio of (a) EBITDA for
the period of four Fiscal Quarters ending on the last day of such quarter to (b)
the sum of the Consolidated Interest Expense, Scheduled Payments and Capital
Expenditures for such period:

<PAGE>

                                                                              62

<TABLE>
<CAPTION>
Quarter Ending                 Ratio
--------------                 -----
<S>                            <C>
    6/30/03                    1.15:1
    9/30/03                    1.15:1
   12/31/03                    1.15:1
    3/31/04                    1.15:1
    6/30/04                    1.15:1
    9/30/04                    1.25:1
   12/31/04                    1.25:1
    3/31/05                    1.25:1
    6/30/05                    1.25:1
    9/30/05                    1.50:1
   12/31/05                    1.50:1
    3/31/06                    1.50:1
    6/30/06                    1.50:1
    9/30/06                    1.50:1
   12/31/06                    1.50:1
    3/31/07                    1.50:1
    6/30/07                    1.50:1
    9/30/07                    1.50:1
   12/31/07                    1.50:1
</TABLE>

                  SECTION 6.09. Maximum Leverage Ratio. The Borrower will not
permit the Leverage Ratio as of the end of any Fiscal Quarter to be greater than
that set forth in the following table:

<TABLE>
<CAPTION>
Quarter Ending                 Ratio
--------------                 -----
<S>                            <C>
    6/30/03                    3.25:1
    9/30/03                    3.25:1
   12/31/03                    3.25:1
    3/31/04                    3.00:1
    6/30/04                    3.00:1
    9/30/04                    2.75:1
   12/31/04                    2.75:1
    3/31/05                    2.50:1
    6/30/05                    2.50:1
    9/30/05                    2.50:1
   12/31/05                    2.50:1
    3/31/06                    2.25:1
    6/30/06                    2.25:1
    9/30/06                    2.25:1
   12/31/06                    2.25:1
    3/31/07                    2.25:1
    6/30/07                    2.25:1
    9/30/07                    2.25:1
   12/31/07                    2.25:1
</TABLE>

<PAGE>

                                                                              63

                  SECTION 6.10. Adjusted Debt to EBITDAR. The Borrower will not
permit the ratio of (i) Adjusted Debt to (ii) EBITDAR at the end of any Fiscal
Quarter to be greater than the amount set forth in the following table:

<TABLE>
<CAPTION>
Quarter Ending                 Ratio
--------------                 -----
<S>                            <C>
    6/30/03                    5.25:1
    9/30/03                    5.25:1
   12/31/03                    5.25:1
    3/31/04                    5.00:1
    6/30/04                    5.00:1
    9/30/04                    5.00:1
   12/31/04                    5.00:1
    3/31/05                    4.75:1
    6/30/05                    4.75:1
    9/30/05                    4.50:1
   12/31/05                    4.50:1
    3/31/06                    4.50:1
    6/30/06                    4.50:1
    9/30/06                    4.25:1
   12/31/06                    4.25:1
    3/31/07                    4.25:1
    6/30/07                    4.25:1
    9/30/07                    4.00:1
   12/31/07                    4.00:1
</TABLE>

For purposes of this Section, at the end of any Fiscal Quarter, (i) "Adjusted
Debt" shall mean Consolidated Funded Indebtedness as of the end such Fiscal
Quarter, plus eight times the rental payments made (net of any sublease income)
during the four Fiscal Quarter period then ended, and (ii) EBITDAR shall mean
the aggregate EBITDA, plus the aggregate rental payments (net of any sublease
income), for the four Fiscal Quarter period then ended.

                  SECTION 6.11. Asset Test. The Borrower will not permit the
ratio of the sum of its consolidated accounts receivable and inventories subject
to a first priority perfected security interest in favor of the Collateral Agent
pursuant to the Guarantee and Collateral Agreement (and, in any event, exclusive
of any then outstanding amounts secured by a security interest on inventory
permitted by Section 6.02(f)) to Consolidated Funded Indebtedness at the end of
any Fiscal Quarter to be less than 1.35 to 1.

                  SECTION 6.12. Disclosure. None of the reports, financial
statements, certificates or other information furnished by or on behalf of the
Borrower to the Administrative Agent or any Lender pursuant to this Agreement or
any of the other Loan Documents will, when so furnished, contain any material
misstatement of fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading; provided that, with respect to projected financial information, such
information may be prepared in good faith based upon assumptions believed to be
reasonable at the time.

<PAGE>

                                                                              64

                  SECTION 6.13. Sale of Assets. The Borrower will not sell,
lease, assign, transfer or otherwise dispose of, or permit any of its
Subsidiaries to sell, lease, assign, transfer or otherwise dispose of, any of
its or their now owned or hereafter acquired assets (including, without
limitation, shares of stock and indebtedness of such Subsidiaries, receivables
and leasehold interests), except: (a) for inventory disposed of in the ordinary
course of business; (b) for transactions with Affiliates permitted under Section
6.06; (c) for the sale or other disposition of assets that are obsolete or no
longer used or usable for the conduct of business in the ordinary course; (d)
for one or more transactions in which fixed or capital assets are sold and
leased back, on terms that do not constitute Capital Lease Obligations (other
than the SunTrust Sale and Leaseback and any transaction described in clause (e)
below), provided that if the aggregate sale price of the assets sold exceeds
$5,000,000, the Net Proceeds of each such sale are used to prepay principal of
the Term Loans, of the Prudential Debt and of the Additional Prudential Notes,
pursuant to Section 2.10(c); (e) that Big O Tires, Inc. and its Subsidiaries
shall be permitted (i) to sell Big O franchisee loans to third parties, and (ii)
to sell to Big O franchisees, or to sell and leaseback for subleasing to Big O
franchisees, Big O stores (including real estate, fixtures and equipment),
provided that, in each case under clauses (i) and (ii) the transaction is in the
ordinary course of business and consistent with past practice; (f) for sales
described in Schedule 6.13; and (g) for the SunTrust Sale and Leaseback.

                  SECTION 6.14. Restricted Payments. The Borrower will not, and
will not permit any of its Subsidiaries to, declare or make, or agree to pay or
make, directly or indirectly, any Restricted Payment, except (a) the Borrower
may declare and pay dividends with respect to its capital stock payable solely
in additional shares of its common stock, (b) Subsidiaries may declare and pay
dividends ratably with respect to their capital stock or other equity interest,
(c) the Borrower may make Restricted Payments pursuant to and in accordance with
stock option plans or other benefits for management or employees of the Borrower
and its Subsidiaries and (d) so long as no Default or Event of Default shall
have occurred and be continuing or would result therefrom, the Borrower may make
payments in an aggregate amount not exceeding $10,000,000 per calendar year on
account of (i) the purchase, redemption, retirement, acquisition, cancellation
or termination of any shares of capital stock of the Borrower or any option,
warrant or other right to acquire any such shares and (ii) the payment of
dividends with respect to its preferred stock.

                                   ARTICLE VII

                                Events of Default

                  If any of the following events ("Events of Default") shall
occur:

                  (a)      the Borrower shall fail to pay any principal of any
         Loan or any reimbursement obligation in respect of any LC Disbursement
         when and as the same shall become due and payable, whether at the due
         date thereof or at a date fixed for prepayment thereof or otherwise;

                  (b)      the Borrower shall fail to pay any interest on any
         Loan or any fee or any other amount (other than an amount referred to
         in clause (a) of this Article) payable under

<PAGE>

                                                                              65

         this Agreement or any other Loan Document when and as the same shall
         become due and payable, and such failure shall continue unremedied for
         a period of three days;

                  (c)      any representation or warranty made or deemed made by
         or on behalf of the Borrower or any Subsidiary in or in connection with
         this Agreement or any other Loan Document or any amendment or
         modification hereof or thereof, or waiver hereunder or thereunder, or
         in any report, certificate, financial statement or other document
         furnished pursuant to or in connection with this Agreement or any other
         Loan Document or any amendment or modification hereof or thereof or
         waiver hereunder or thereunder, shall prove to have been materially
         incorrect when made or deemed made;

                  (d)      (i) the Borrower shall fail to observe or perform any
         covenant, condition or agreement contained in Section 5.03, 5.04 (with
         respect to the Borrower's existence) or 5.08, or (ii) the Borrower
         shall fail to observe or perform any covenant or agreement contained in
         Article VI, and in each case in clauses (i) and (ii), either (x) such
         failure is not remedied within two Business Days after any of the Chief
         Executive Officer of the Borrower or any Financial Officer obtains
         knowledge thereof or (xx) within such two-day period, the Required
         Lenders, or the Co-Administrative Agent on instructions of the Required
         Lenders, gives the Borrower notice that such failure constitutes a
         Default;

                  (e)      the Borrower shall fail to observe or perform any
         covenant, condition or agreement contained in this Agreement (other
         than those specified in clauses (a), (b), (c) or (d) of this Article),
         and such failure shall continue unremedied for a period of 30 days
         after the earlier to occur of (i) the date the Borrower shall have
         obtained knowledge thereof and (ii) written notice thereof from the
         Co-Administrative Agent to the Borrower (which notice will be given at
         the request of any Lender);

                  (f)      the Borrower or any Subsidiary shall fail to make any
         payment (whether of principal or interest and regardless of amount) in
         respect of any Material Indebtedness, when and as the same shall become
         due and payable;

                  (g)      any event or condition occurs that results in any
         Material Indebtedness becoming due prior to its scheduled maturity or
         that enables or permits (with or without the giving of notice, the
         lapse of time or both) the holder or holders of any Material
         Indebtedness or any trustee or agent on its or their behalf to cause
         any Material Indebtedness to become due, or to require the prepayment,
         repurchase, redemption or defeasance thereof, prior to its scheduled
         maturity; provided that this clause (g) shall not apply to secured
         Indebtedness that becomes due as a result of the voluntary sale or
         transfer of the property or assets securing such Indebtedness;

                  (h)      an involuntary proceeding shall be commenced or an
         involuntary petition shall be filed seeking (i) liquidation,
         reorganization or other relief in respect of the Borrower or any
         Subsidiary or its debts, or of a substantial part of its assets, under
         any Federal, state or foreign bankruptcy, insolvency, receivership or
         similar law now or hereafter in effect or (ii) the appointment of a
         receiver, trustee, custodian, sequestrator, conservator or similar
         official for the Borrower or any Subsidiary or for a substantial part
         of its assets, and, in any such case, such proceeding or petition shall
         continue

<PAGE>

                                                                              66

         undismissed for 60 days or an order or decree approving or ordering any
         of the foregoing shall be entered;

                  (i)      the Borrower or any Subsidiary shall (i) voluntarily
         commence any proceeding or file any petition seeking liquidation,
         reorganization or other relief under any Federal, state or foreign
         bankruptcy, insolvency, receivership or similar law now or hereafter in
         effect, (ii) consent to the institution of, or fail to contest in a
         timely and appropriate manner, any proceeding or petition described in
         clause (h) of this Article, (iii) apply for or consent to the
         appointment of a receiver, trustee, custodian, sequestrator,
         conservator or similar official for the Borrower or any Subsidiary or
         for a substantial part of its assets, (iv) file an answer admitting the
         material allegations of a petition filed against it in any such
         proceeding, (v) make a general assignment for the benefit of creditors
         or (vi) take any action for the purpose of effecting any of the
         foregoing;

                  (j)      the Borrower shall become unable, admit in writing
         its inability or fail generally to pay its debts as they become due;

                  (k)      one or more judgments for the payment of money in an
         aggregate amount in excess of $3,000,000 shall be rendered against the
         Borrower, any Subsidiary or any combination thereof and the same shall
         remain undischarged for a period of 30 consecutive days during which
         execution shall not be effectively stayed, or any action shall be
         legally taken by a judgment creditor to attach or levy upon any assets
         of the Borrower or any Subsidiary to enforce any such judgment;

                  (l)      an ERISA Event shall have occurred that, in the
         opinion of the Required Lenders, when taken together with all other
         ERISA Events that have occurred, could reasonably be expected to result
         in liability of the Borrower and its Subsidiaries in an aggregate
         amount exceeding $2,000,000;

                  (m)      a Change in Control shall occur;

                  (n)      the Borrower or any Subsidiary shall be subject to
         any Environmental Liability or the subject of any proceeding or
         investigation pertaining to the release by the Borrower or any
         Subsidiary, or any other Person of any Hazardous Material into the
         environment, or pertaining to any violation of any Environmental Law,
         which, in any case, could reasonably be expected to have a Material
         Adverse Effect; or

                  (o)      the Guarantee and Collateral Agreement, the guarantee
         contained in Section 2 of the Guarantee and Collateral Agreement or any
         Mortgage shall for any reason cease to be an enforceable obligation of
         the Borrower or any Grantor, as the case may be, that executed the same
         or if such party or any other Person should contest the validity of
         such guarantee, the Guarantee and Collateral Agreement or Mortgage or
         shall seek in any way to have it declared null and void or to have such
         party's obligations thereunder in any way limited, or if such party
         shall in any respect not described elsewhere in this Article fail to
         perform any of its obligations under such Guarantee and Collateral
         Agreement or any Mortgage, and such failure shall continue unremedied
         for a period of fifteen days after the earlier to occur of (i) the date
         the Borrower shall have

<PAGE>

                                                                              67

         obtained knowledge thereof or (ii) written notice thereof from the
         Collateral Agent to the Borrower (which notice will be given at the
         request of any Lender);

then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Co-Administrative Agent shall,
pursuant to the request of the Required Lenders, by notice to the Borrower, take
either or both of the following actions, at the same or different times: (i)
terminate the Revolving Credit Commitments, and thereupon the Revolving Credit
Commitments shall terminate immediately, and (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so declared to be due
and payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; and in case of any event with
respect to the Borrower described in clause (h) or (i) of this Article, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become due
and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower.

                                  ARTICLE VIII

            The Administrative Agent and the Co-Administrative Agent

                  Each of the Lenders and the Issuing Banks hereby irrevocably
appoints each of the Administrative Agent and the Co-Administrative Agent as its
agent under this Agreement and the other Loan Documents, and authorizes the
Administrative Agent and the Co-Administrative Agent to take such actions on its
behalf and to exercise such powers as are delegated respectively to the
Administrative Agent and the Co-Administrative Agent by the terms hereof and of
the other Loan Documents together with such actions and powers as are reasonably
incidental thereto.

                  Each bank serving as the Administrative Agent and the
Co-Administrative Agent hereunder shall have the same rights and powers in its
capacity as a Lender as any other Lender and may exercise the same as though it
were not the Administrative Agent or the Co-Administrative Agent, and such bank
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent or the Co-Administrative
Agent hereunder.

                  Neither the Administrative Agent nor the Co-Administrative
Agent shall have any duties or obligations except those expressly set forth
herein and in the other Loan Documents. Without limiting the generality of the
foregoing, (a) neither shall be subject to any fiduciary or other implied
duties, regardless of whether a Default has occurred and is continuing, (b)
neither shall have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby and in the other Loan Documents that the Administrative
Agent or the Co-Administrative Agent is required to exercise in writing

<PAGE>

                                                                              68

by the Required Lenders (or such other number or percentage of the Lenders as
shall be necessary under the circumstances as provided in Section 9.02), and (c)
except as expressly set forth herein, neither the Administrative Agent nor the
Co-Administrative Agent shall have any duty to disclose, nor shall it be liable
for the failure to disclose, any information relating to the Borrower or any of
the Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or Co-Administrative Agent, as the case may be, or any of
its respective Affiliates in any capacity. Neither the Administrative Agent nor
the Co-Administrative Agent shall be liable for any action taken or not taken by
it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02) or for any action taken or not taken
by it in the absence of its own gross negligence or wilful misconduct. Neither
the Administrative Agent nor the Co-Administrative Agent shall be deemed to have
knowledge of any Default (including any event of default under any other Loan
Document) unless and until written notice thereof is given to it by the Borrower
or a Lender, and neither the Administrative Agent nor the Co-Administrative
Agent shall be responsible for or have any duty to ascertain or inquire into (i)
any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein,
(iv) the validity, enforceability, effectiveness or genuineness of this
Agreement or any other Loan Document or any other agreement, instrument or
document, or (v) the satisfaction of any condition set forth in Article IV or
elsewhere herein or in any other Loan Document other than to confirm receipt of
items expressly required to be delivered to the Administrative Agent or the
Co-Administrative Agent, as the case may be.

                  The Administrative Agent and the Co-Administrative Agent shall
be entitled to rely upon, and shall not incur any liability for relying upon,
any notice, request, certificate, consent, statement, instrument, document or
other writing believed by it to be genuine and to have been signed or sent by
the proper Person. Each of the Administrative Agent and the Co-Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any
liability for relying thereon. Each of the Administrative Agent and the
Co-Administrative Agent may consult with legal counsel (who may be counsel for
the Borrower), independent accountants and other experts selected by it, and
shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.

                  Each of the Administrative Agent and the Co-Administrative
Agent may perform any and all its duties and exercise its rights and powers by
or through any one or more sub-agents appointed by it. The Administrative Agent
and the Co-Administrative Agent and any such sub-agent may perform any and all
duties and exercise rights and powers through their respective Related Parties.
The exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Related Parties of the Administrative Agent and the
Co-Administrative Agent, and any such sub-agent.

                  Upon the appointment and acceptance of a successor
Administrative Agent or Co-Administrative Agent as provided in this paragraph,
the Administrative Agent or Co-Administrative Agent may resign at any time by
notifying the Lenders, the Issuing Bank and the

<PAGE>

                                                                              69

Borrower. Upon any such resignation, the Required Lenders shall have the right,
with the approval of the Borrower (provided Borrower's approval shall not be
required during the existence of a Default), to appoint a successor. If no
successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after the retiring Administrative Agent
or Co-Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent or Co-Administrative Agent may, on behalf of the Lenders
and the Issuing Bank, appoint a successor Administrative Agent or
Co-Administrative Agent, which shall be a bank with an office in the United
States, or an Affiliate of any such bank. Upon the acceptance of its appointment
as Administrative Agent or Co-Administrative Agent hereunder and under the other
Loan Documents by a successor, such successor shall succeed to and become vested
with all the rights, powers, privileges and duties of the retiring
Administrative Agent or Co-Administrative Agent, and the retiring Administrative
Agent or Co-Administrative Agent shall be discharged from any further duties and
obligations hereunder and under the other Loan Documents. The fees payable by
the Borrower to a successor Administrative Agent or Co-Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Administrative Agent's or
Co-Administrative Agent's resignation hereunder, the provisions of this Article
and Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent or Co-Administrative Agent, its sub agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while acting as Administrative Agent or Co-Administrative
Agent, as the case may be.

                  Each Lender acknowledges that it has, independently and
without reliance upon the Administrative Agent, the Co-Administrative Agent, or
any other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent, the Co-Administrative Agent or any other
Lender and based on such documents and information as it shall from time to time
deem appropriate, continue to make its own decisions in taking or not taking
action under or based upon this Agreement, any related agreement or any document
furnished hereunder or thereunder.

                                   ARTICLE IX

                                  Miscellaneous

                  SECTION 9.01. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:

                  (a)      if to the Borrower, to it at 4770 Hickory Hill Road,
         Memphis, Tennessee 38141, Attention of Chief Financial Officer, (Fax
         No. (901) 541-3752);

                  (b)      if to the Administrative Agent, to National
         Department, 165 Madison Avenue, Memphis, Tennessee 38103, Attention of
         Manager, National Department (Fax No. (901) 523-4267);

<PAGE>

                                                                              70

                  (c)      if to any Issuing Bank, to First Tennessee Bank
         National Association at National Department, 165 Madison Avenue,
         Memphis, Tennessee 38103, Attention of James Moore, Senior Vice
         President (Fax No. (901) 523-4267) and to JPMorgan Chase Bank at
         Corporate Banking Department, One Chase Square, 9th Floor, Rochester,
         New York, 14643, Attention of Bruce Yoder, Vice President (Fax No.
         (716) 258-4258);

                  (d)      if to the Swingline Lender, to it at National
         Department, 165 Madison Avenue, Memphis, Tennessee 38103, Attention of
         Manager, National Department (Fax No. (901) 523-4267);

                  (e)      if to the Co-Administrative Agent, to it at it at
         Corporate Banking Department, One Chase Square, 9th Floor, Rochester,
         New York, 14643, Attention of Bruce Yoder, Vice President (Fax No.
         (716) 258-4258);

                  (f)      if to any other Lender, to it at its address (or
         telecopy number) set forth in its Administrative Questionnaire.

Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.

                  SECTION 9.02. Waivers; Amendments. (a) No failure or delay by
the Administrative Agent, the Co-Administrative Agent, any Issuing Bank or any
Lender in exercising any right or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Administrative Agent, the
Co-Administrative Agent, the Issuing Banks and the Lenders hereunder are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of this Agreement or consent to any
departure by the Borrower therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) of this Section, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given. Without limiting the generality of the foregoing, the making of
a Loan or issuance of a Letter of Credit shall not be construed as a waiver of
any Default, regardless of whether the Administrative Agent, the
Co-Administrative Agent, any Lender or any Issuing Bank may have had notice or
knowledge of such Default at the time.

                  (b)      Neither this Agreement, any Loan Document nor any
provision hereof or thereof may be waived, amended or modified except pursuant
to an agreement or agreements in writing entered into by the Borrower and the
Required Lenders or by the Borrower and the Co-Administrative Agent with the
consent of the Required Lenders; provided that no such agreement shall (i)
increase the Commitment of any Lender without the written consent of such
Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce any fees payable hereunder, or
waive or release the obligation of the Borrower with respect to any such
principal, interest, fees, or LC Disbursement without the written consent of
each Lender affected thereby, (iii) postpone the scheduled date of payment of

<PAGE>

                                                                              71

the principal amount of any Loan or LC Disbursement, or any interest thereon, or
any fees payable hereunder, or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date of expiration of any Commitment, without
the written consent of each Lender affected thereby, (iv) change Section 2.17(b)
or (c) in a manner that would alter the pro rata sharing of payments required
thereby, without the written consent of each Lender, (v) change any of the
provisions of this Section or the definition of "Required Lenders" or any other
provision hereof specifying the number or percentage of Lenders required to
waive, amend or modify any rights hereunder or make any determination or grant
any consent hereunder, without the written consent of each Lender, or (vi)
waive, amend or modify any of the provisions of Article VIII or, except as
provided in Section 4(a) of the Intercreditor Agreement, release any of the
Collateral or release all or substantially all of the Guarantors from their
obligations under the Collateral Agreement, without the written consent of all
Lenders; provided further that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent, the
Co-Administrative Agent, the Issuing Banks or the Swingline Lender hereunder
without the prior written consent of the Administrative Agent, the
Co-Administrative Agent, the Issuing Banks or the Swingline Lender, as the case
may be.

                  (c)      Should the Borrower or any Guarantor become a party
to a case under the United States Bankruptcy Code, each Lender shall be entitled
to file its own claim, to the extent that a filing may be necessary. The
Co-Administrative Agent shall review each claim before being filed by a Lender
to assure that the claim is filed on a basis consistent with the Administrative
Agent's and the Co-Administrative Agent's records and the legal position, if
any, taken by the Administrative Agent or the Co-Administrative Agent on behalf
of the Lenders pursuant to this Agreement. Should the Borrower or any Guarantor
become a party to a reorganization proceeding under the United States Bankruptcy
Code, each Lender shall be recognized as the holder of a separate claim for the
purpose of the approval or rejection of a plan under 11 U.S.C. Section 1126, may
freely vote such claim, and the provisions of this Section shall control Section
9.02(b) and the other provisions of this Agreement that might otherwise require
the consent of the Required Lenders or of all Lenders in such circumstances. The
Administrative Agent and Co-Administrative Agent shall continue as such under
this Agreement and the other Loan Documents as they may be amended by any
adopted plan of reorganization in such a proceeding.

                  SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The
Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent, the Co-Administrative Agent and their respective
Affiliates, including the reasonable fees, charges and disbursements of their
respective counsel, in connection with the syndication of the credit facilities
provided for herein, and the preparation and administration of this Agreement
and the other Loan Documents or any amendments, modifications or waivers of the
provisions hereof and thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket
expenses incurred by any Issuing Bank in connection with the issuance,
amendment, renewal or extension of any Letter of Credit or any demand for
payment related thereto and (iii) all out-of-pocket expenses incurred by the
Collateral Agent under the Guarantee and Collateral Agreement, any Issuing Bank
or any Lender, including the fees, charges and disbursements of any counsel for
the Administrative Agent, the Co-Administrative Agent, any Issuing Bank or any
Lender, in connection with the enforcement or protection of its rights in
connection with this Agreement, and the other Loan

<PAGE>

                                                                              72

Documents including its rights under this Section, or in connection with the
Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.

                  (b)      The Borrower shall indemnify the Administrative
Agent, the Co-Administrative Agent, each Issuing Bank and each Lender, and each
Related Party of any of the foregoing Persons (each such Person being called an
"Indemnitee") against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses, including the fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery by the Borrower or any Grantor of this
Agreement, the other Loan Documents and any agreement or instrument contemplated
hereby or thereby, the performance by the Borrower or any Grantor of their
respective obligations hereunder and under the other Loan Documents or the
consummation of the Transactions or any other transactions contemplated hereby,
(ii) any Loan or Letter of Credit or the use of the proceeds therefrom
(including any refusal by the Issuing Bank to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit) (iii) any actual or
alleged presence or release of Hazardous Materials on or from any property owned
or operated by the Borrower or any of its Subsidiaries, or any Environmental
Liability related in any way to the Borrower or any of its Subsidiaries, or (iv)
any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or wilful misconduct of such
Indemnitee.

                  (c)      To the extent that the Borrower fails to pay any
amount required to be paid by it to the Administrative Agent, the
Co-Administrative Agent, each Issuing Bank or the Swingline Lender under
paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the
Administrative Agent, the Co-Administrative Agent, each Issuing Bank or the
Swingline Lender, as the case may be, such Lender's pro rata share (determined
as of the time that the applicable unreimbursed expense or indemnity payment is
sought based on such Lender's Revolving Credit Commitment as a percentage of all
Revolving Credit Commitments) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent, the Co-Administrative Agent, the Issuing Bank or the
Swingline Lender, in its capacity as such.

                  (d)      To the extent permitted by applicable law, the
Borrower shall not assert, and it hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement, any other Loan Document or
any agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit, or the use of the proceeds thereof.

<PAGE>

                                                                              73

                  (e)      All amounts due under this Section shall be payable
promptly after written demand therefor.

                  SECTION 9.04. Successors and Assigns; Participations and
Assignments. (a) The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby (including any Affiliate of any Issuing Bank that
issues any Letter of Credit), except that (i) the Borrower may not assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by the
Borrower without such consent shall be null and void) and (ii) no Lender may
assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section.

                  (b)      (i) Subject to the conditions set forth in paragraph
(b)(ii) below, any Lender may assign to one or more assignees (each, an
"Assignee") all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitments and the Loans at the time owing
to it) with the prior written consent (such consent not to be unreasonably
withheld) of:

                  (A) the Borrower, provided that no consent of the Borrower
         shall be required for an assignment to a Lender, an affiliate of a
         Lender, an Approved Fund (as defined below) or, if an Event of Default
         under Article VII has occurred and is continuing, any other Person; and

                  (B) the Co-Administrative Agent, provided that no consent of
         the Co-Administrative Agent shall be required for an assignment of (x)
         any Revolving Commitment to an assignee that is a Lender with a
         Revolving Commitment immediately prior to giving effect to such
         assignment or (y) all or any portion of a Term Loan to a Lender, an
         Affiliate of a Lender or an Approved Fund.

                  (ii) Assignments shall be subject to the following additional
         conditions:

                  (A) except in the case of an assignment to a Lender, an
         affiliate of a Lender or an Approved Fund or an assignment of the
         entire remaining amount of the assigning Lender's Commitments or Loans
         under any Term Loan or Revolving Loan, the amount of the Commitments or
         Loans of the assigning Lender subject to each such assignment
         (determined as of the date the Assignment and Acceptance with respect
         to such assignment is delivered to the Administrative Agent) shall not
         be less than $2,000,000 unless each of the Borrower and the
         Administrative Agent otherwise consent, provided that (1) no such
         consent of the Borrower shall be required if an Event of Default under
         Article VII has occurred and is continuing and (2) such amounts shall
         be aggregated in respect of each Lender and its affiliates or Approved
         Funds, if any;

                  (B) the parties to each assignment shall execute and deliver
         to the Co-Administrative Agent an Assignment and Acceptance, together
         with a processing and recordation fee of $3,500; and

                  (C) the Assignee, if it shall not be a Lender, shall deliver
         to the Administrative Agent an Administrative Questionnaire.

<PAGE>

                                                                              74

                  For the purposes of this Section 9.04, the term "Approved
Fund" has the following meaning:

                  "Approved Fund" means any Person (other than a natural person)
         that is engaged in making, purchasing, holding or investing in bank
         loans and similar extensions of credit in the ordinary course of its
         business and that is administered or managed by (a) a Lender, (b) an
         Affiliate of a Lender or (c) an entity or an Affiliate of an entity
         that administers or manages a Lender.

                  (iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) below, from and after the effective date specified in each
Assignment and Acceptance the Assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Acceptance, have
the rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all of the assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of Sections
2.14, 2.15, 2.16 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 9.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section.

                  (iv) The Co-Administrative Agent, acting for this purpose as
an agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Acceptance delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amount of the Loans and LC Disbursements owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent, the
Co-Administrative Agent, each Issuing Bank and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower, each
Issuing Bank and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.

                  (v) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and an Assignee, the Assignee's
completed Administrative Questionnaire (unless the Assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in paragraph
(b) of this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Co-Administrative Agent shall accept such
Assignment and Acceptance and record the information contained therein in the
Register. No assignment shall be effective for purposes of this Agreement unless
it has been recorded in the Register as provided in this paragraph.

                  (c)      (i) Any Lender may, without the consent of the
Borrower or the Administrative Agent, sell participations to one or more banks
or other entities (a "Participant") in all or a portion of such Lender's rights
and obligations under this Agreement (including all or a portion of its
Commitments and the Loans owing to it); provided that (A) such Lender's

<PAGE>

                                                                              75

obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (C) the Borrower, the Administrative Agent, the
Co-Administrative Agent, each Issuing Bank and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement pursuant to which a
Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver that (1) requires
the consent of each Lender directly affected thereby pursuant to the proviso to
Section 9.02(b) and (2) directly affects such Participant. Subject to paragraph
(c)(ii) of this Section, the Borrower agrees that each Participant shall be
entitled to the benefits of Sections 2.14, 2.15 and 2.16 to the same extent as
if it were a Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section. To the extent permitted by law, each Participant
also shall be entitled to the benefits of Section 9.08 as though it were a
Lender, provided such Participant agrees to be subject to Section 2.17(c) as
though it were a Lender.

                  (ii) A Participant shall not be entitled to receive any
greater payment under Section 2.14 or 2.16 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower's prior written consent. Any Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of
Section 2.16 unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower, to
comply with Section 2.16(e) as though it were a Lender.

                  (d)      Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement to
secure obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or Assignee for such Lender
as a party hereto.

                  (e)      The Borrower, upon receipt of written notice from the
relevant Lender, agrees to issue Notes to any Lender requiring Notes to
facilitate transactions of the type described in paragraph (d) above.

                  (f)      Notwithstanding the foregoing, any Conduit Lender may
assign any or all of the Loans it may have funded hereunder to its designating
Lender without the consent of the Borrower or the Administrative Agent and
without regard to the limitations set forth in Section 9.04(b). Each of the
Borrower, each Lender, the Administrative Agent and the Co-Administrative Agent
hereby confirms that it will not institute against a Conduit Lender or join any
other Person in instituting against a Conduit Lender any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding under any
state bankruptcy or similar law, for one year and one day after the payment in
full of the latest maturing commercial paper note issued by such Conduit Lender;
provided, however, that each Lender designating any Conduit Lender hereby agrees
to indemnify, save and hold harmless each other party hereto for any loss,

<PAGE>

                                                                              76

cost, damage or expense arising out of its inability to institute such a
proceeding against such Conduit Lender during such period of forbearance.

                  SECTION 9.05. Survival. All covenants, agreements,
representations and warranties made by the Borrower herein and in the other Loan
Documents and in the certificates or other instruments delivered in connection
with or pursuant to this Agreement and the other Loan Documents shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and the issuance of any Letters of Credit, regardless of any investigation made
by any such other party or on its behalf and notwithstanding that the
Administrative Agent, the Co-Administrative Agent, any Issuing Bank or any
Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement or the other Loan Documents is outstanding and unpaid or any Letter of
Credit is outstanding and so long as the Revolving Credit Commitments have not
expired or terminated. The provisions of Sections 2.14, 2.15, 2.16, 9.03 and
9.12 and Article VIII shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, the expiration or termination of the Letters of Credit
and the Revolving Credit Commitments or the termination of this Agreement or any
provision hereof.

                  SECTION 9.06. Counterparts; Integration; Effectiveness. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement and
any separate letter agreements with respect to fees payable to the
Administrative Agent, any Issuing Bank or any Lender constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all previous agreements and understandings, oral or written, relating to
the subject matter hereof including, without limitation, each Commitment Letter
between the Borrower and each Lender, to the extent, but only to the extent,
that it relates to such Lender. Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and the Co-Administrative Agent and when the
Co-Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement. Execution and delivery of
this Agreement as provided above shall constitute authorization to the
Administrative Agent and the Co-Administrative Agent to execute and deliver the
Intercreditor Agreement on its behalf, and each Assignee shall become a party to
the Intercreditor Agreement upon its becoming a Lender pursuant to the term and
conditions hereof.

                  SECTION 9.07. Severability. Any provision of this Agreement
held to be invalid, illegal or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such invalidity, illegality
or unenforceability without affecting the validity, legality and enforceability
of the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

<PAGE>

                                                                              77

                  SECTION 9.08. Right of Setoff. If an Event of Default shall
have occurred and be continuing, each Lender and each of its Affiliates is
hereby authorized, provided that it has the consent of the Co-Administrative
Agent (which consent may not be unreasonably withheld), at any time and from
time to time, to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other obligations at any time owing by such Lender or
Affiliate to or for the credit or the account of the Borrower against any and
all of the obligations of the Borrower now or hereafter existing under this
Agreement held by such Lender, irrespective of whether or not such Lender shall
have made any demand under this Agreement and although such obligations may be
unmatured. The rights of each Lender under this Section are in addition to other
rights and remedies (including other rights of setoff) which such Lender may
have.

                  SECTION 9.09. Governing Law, Jurisdiction; Consent to Service
of Process. (a) This Agreement shall be construed in accordance with and
governed by the law of the State of New York applicable to contracts made and to
be performed in such state, without regard to conflict of laws principles.

                  (b)      The Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Courts of the State of New York sitting in New York County and of the United
States District Court sitting in New York County, New York and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Agreement, or for recognition or enforcement of any judgment, and each
of the parties hereto hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in such New York state or, to the extent permitted by law, in such Federal
court. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that the Administrative Agent,
the Co-Administrative Agent, the Issuing Bank or any Lender may otherwise have
to bring any action or proceeding relating to this Agreement against the
Borrower or its properties in the courts of any jurisdiction.

                  (c)      The Borrower hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any court
referred to in paragraph (b) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

                  (d)      Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01. Nothing
in this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.

                  SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON

<PAGE>

                                                                              78

CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

                  SECTION 9.11. Headings. Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.

                  SECTION 9.12. Confidentiality. Each of the Administrative
Agent, the Co-Administrative Agent, the Issuing Banks and the Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates' directors, officers,
employees and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (f) if an agreement containing provisions substantially the same as
those of this Section has been obtained, to any assignee of or Participant in,
or any prospective assignee of or Participant in, any of its rights or
obligations under this Agreement, (g) with the consent of the Borrower or (h) to
the extent such Information (i) becomes publicly available other than as a
result of a breach of this Section or (ii) becomes available to the
Administrative Agent, the Co-Administrative Agent, any Issuing Bank or any
Lender on a nonconfidential basis from a source other than the Borrower. For the
purposes of this Section, "Information" means all information received from the
Borrower relating to the Borrower or its Subsidiaries' businesses, other than
any such information that is available to the Administrative Agent, the
Co-Administrative Agent, the Issuing Bank or any Lender on a nonconfidential
basis prior to disclosure by the Borrower; provided that, in the case of
information received from the Borrower after the date hereof, such information
is clearly identified at the time of delivery as confidential. Any Person
required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.

                  SECTION 9.13. Interest Rate Limitation. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan or LC Disbursement, together with all fees, charges and other amounts
which are treated as interest on such Loan or LC Disbursement under applicable
law (collectively the "Charges"), shall exceed the maximum lawful rate (the
"Maximum Rate") which may be contracted for, charged, taken, received or
reserved by the Lender holding such Loan in accordance with applicable law, the
rate of interest payable in respect of such Loan hereunder, together with all
Charges payable in respect thereof, shall be limited to the Maximum Rate and, to
the extent lawful, the interest and Charges that

<PAGE>

                                                                              79

would have been payable in respect of such Loan but were not payable as a result
of the operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

<PAGE>

                                                                              80

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.

Borrower                             TBC CORPORATION

                                     By: /S/ LAWRENCE C. DAY
                                         -----------------------
                                         Name:  Lawrence C. Day
                                         Title: President and Chief Executive
                                                Officer

Lenders and Administrative Agent     FIRST TENNESSEE BANK NATIONAL
                                     ASSOCIATION, individually, as
                                     Administrative Agent, as Swingline
                                     Lender and as Issuing Bank

                                     By: /S/ JAMES H. MOORE, JR.
                                         -----------------------
                                         Name:  James H. Moore, Jr.
                                         Title: Senior Vice President

                                     JPMORGAN CHASE BANK, individually, as
                                     Co-Administrative Agent and as Issuing Bank

                                     By: /S/ BRUCE YODER
                                         -----------------------
                                         Name:  Bruce Yoder
                                         Title: Vice President

                                     U.S. BANK NATIONAL ASSOCIATION,
                                     individually and as Documentation Agent

                                     By: /S/ BRIAN H. GALLAGHER
                                         -----------------------
                                         Name:  Brian H. Gallagher
                                         Title: Vice President

                                     SUNTRUST BANK, individually and as
                                     Syndication Agent

                                     By: /S/ LEONARD L. MCKINNON
                                         -----------------------
                                         Name:  Leonard L. McKinnon
                                         Title: Director

<PAGE>

                                                                              81

                                     FLEET CAPITAL CORPORATION

                                     By: /S/ ROBERT B. H. MOORE
                                         -----------------------
                                         Name:  Robert B. H. Moore
                                         Title: Senior Vice President

                                     NATIONAL CITY

                                     By: /S/ KEVIN M. KNOPF
                                         -----------------------
                                         Name:  Kevin M. Knopf
                                         Title: Vice President

                                     FIFTH THIRD BANK

                                     By: /S/ JAMES E. SIMPSON
                                         -----------------------
                                         Name:  James E. Simpson
                                         Title: Vice President

                                     GUARANTY BANK

                                     By: /S/ SCOTT L. BREWER
                                         -----------------------
                                         Name:  Scott L. Brewer
                                         Title: Vice President

                                     REGIONS BANK

                                     By: /S/ SAM PRUDHOMME
                                         -----------------------
                                         Name:  Sam Prudhomme
                                         Title: Assistant Vice President

                                     UNION PLANTERS BANK, N.A.

                                     By: /S/ TED MILLER
                                         -----------------------
                                         Name:  Ted Miller
                                         Title: Vice President

<PAGE>

                                                                              82

                                     COMPASS BANK

                                     By: /S/ KEELY W. MCGEE
                                         -----------------------
                                         Name:  Keely W. McGee
                                         Title: Vice President
<PAGE>
                                                                  SCHEDULE 1.01A

                                    [FORM OF]
                            ASSIGNMENT AND ACCEPTANCE

      Reference is made to the Credit Agreement dated as of March 31, 2003 (as
amended and in effect on the date hereof, the "Credit Agreement"), among TBC
Corporation, the Lenders named therein, First Tennessee Bank National
Association, as Administrative Agent for the Lenders, and JPMorgan Chase Bank,
as Co-Administrative Agent for the Lenders. Terms defined in the Credit
Agreement are used herein with the same meanings.

      The Assignor named on the reverse hereof hereby sells and assigns, without
recourse, to the Assignee named on the reverse hereof, and the Assignee hereby
purchases and assumes, without recourse, from the Assignor, effective as of the
Assignment Date set forth on the reverse hereof, the interests set forth on the
reverse hereof (the "Assigned Interest") in the Assignor's rights and
obligations under the Credit Agreement, including, without limitation, the
interests set forth on the reverse hereof in the Revolving Credit Commitment of
the Assignor on the Assignment Date and Loans owing to the Assignor which are
outstanding on the Assignment Date, together with the participations in Letters
of Credit, LC Disbursements and Swingline Loans held by the Assignor on the
Assignment Date, but excluding accrued interest and fees to and excluding the
Assignment Date. The Assignee hereby acknowledges receipt of a copy of the
Credit Agreement and the other Loan Documents. From and after the Assignment
Date (i) the Assignee shall be a party to and be bound by the provisions of the
Credit Agreement and the Intercreditor Agreement and, to the extent of the
Assigned Interest, have the rights and obligations of a Lender thereunder and
under the other Loan Documents and (ii) the Assignor shall, to the extent of the
Assigned Interest, relinquish its rights and be released from its obligations
under the Credit Agreement and the other Loan Documents.

      This Assignment and Acceptance is being delivered to the Administrative
Agent together with (i) if the Assignee is a Foreign Lender, any documentation
required to be delivered by the Assignee pursuant to Section 2.16(e) of the
Credit Agreement, duly completed and executed by the Assignee, and (ii) if the
Assignee is not already a Lender under the Credit Agreement, an Administrative
Questionnaire in the form supplied by the Administrative Agent, duly completed
by the Assignee. The Assignee shall pay the fee payable to the Administrative
Agent pursuant to Section 9.04(b) of the Credit Agreement.

      This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.

Date of Assignment:

Legal Name of Assignor:
<PAGE>
Legal Name of Assignee:

Assignee's Address for Notices:

Effective Date of Assignment
("Assignment Date"):

<TABLE>
<CAPTION>
FACILITY                          PRINCIPAL AMOUNT      PERCENTAGE ASSIGNED OF
                                  ASSIGNED              FACILITY/REVOLVING CREDIT
                                                        COMMITMENT (SET FORTH,
                                                        TO AT LEAST 8 DECIMALS,
                                                        AS A PERCENTAGE OF THE
                                                        FACILITY AND THE
                                                        AGGREGATE REVOLVING
                                                        CREDIT COMMITMENTS OF
                                                        ALL LENDERS THEREUNDER
<S>                               <C>                   <C>
Revolving Credit                  $                                         %
Commitment Assigned:
Revolving Loans:                  $                                         %
Tranche A Term Loans:             $                                         %
Tranche B Term Commitment         $                                         %
Assigned:
Tranche B Term Loans:             $                                         %
</TABLE>

The terms set forth above and on the reverse side hereof are hereby agreed to:

                                      [NAME OF ASSIGNOR], AS ASSIGNOR

                                      BY:     _________________________________
                                              NAME:
                                              TITLE:

                                      [Name of Assignee], as Assignee

                                      By:     _________________________________
                                              Name:
                                              Title:
<PAGE>
The undersigned hereby consent to the within assignment:

<TABLE>
<S>                                       <C>
TBC Corporation                           JPMORGAN CHASE BANK, AS CO-ADMINISTRATIVE

                                          AGENT

BY: _________________________________

    NAME:                                 BY: _________________________________
    Title:                                    NAME:
                                              TITLE:
</TABLE>
<PAGE>
                                                                  SCHEDULE 1.01B

                 FORM OF INCREMENTAL FACILITY ACTIVATION NOTICE

To:     JPMORGAN CHASE BANK,
        as Co-Administrative Agent under the Credit Agreement referred to below

            Reference is hereby made to the Credit Agreement, dated as of March
[31], 2003 (as amended, supplemented or otherwise modified from time to time,
the "Credit Agreement"), among TBC Corporation (the "Borrower"), the Lenders
party thereto, the Syndication Agent and Documentation Agents named therein,
First Tennessee National Association, as administrative agent (in such capacity,
the "Administrative Agent") and JPMorgan Chase Bank, as co-administration agent
for the Lenders (in such capacity the "Co-Administrative Agent"). Terms defined
in the Credit Agreement shall have their defined meanings when used herein.

            This notice is an Incremental Facility Activation Notice referred to
in the Credit Agreement, and the Borrower and each of the Lenders party hereto
hereby notify you that:

      1.    Each Lender party hereto agrees to make or increase the amount of
            its Revolving Commitments in the amount set forth opposite such
            Lender's name below under the caption "Increased Facility Amount".

      2.    The Increased Facility Closing Date is ______.

            The undersigned [Chief Financial Officer][Vice President - Finance]
of the Borrower certifies as follows:

      1.    I am the duly elected, qualified and acting [Chief Financial
            Officer][Vice President - Finance] of the Borrower.

      2.    I have reviewed and am familiar with the contents of this Increased
            Facility Activation Notice.

      3.    I have reviewed the terms of the Credit Agreement and the Loan
            Documents and have made or caused to be made under my supervision, a
            review in reasonable detail of the transactions and condition of the
            Borrower during the accounting period ended __________ __, 200_
            [insert most recent period for which Financial Statements have been
            delivered]. Such review did not disclose the existence during or at
            the end of the accounting period covered by the Financial
            Statements, and I have no knowledge of the existence, as of the date
            of this Certificate, of any Default or Event of Default, both on the
            date hereof and after giving pro forma effect to any Loans made
            pursuant to this Increased Facility Activation Notice and the
            application of the proceeds therefrom.
<PAGE>
      4.    The requirements set forth in clauses (B), (C) and (D) of the
            proviso to Section 2.02(d) of the Credit Agreement have been
            complied with in connection with this Increased Facility Activation
            Notice.

            IN WITNESS WHEREOF, the undersigned have executed this Increased
Facility Activation Notice this _____ day of ____, 200__.

                                          ------------------------------------
                                          Name:
                                          Title:  [Chief Financial Officer][Vice
                                          President-Finance]

                                          TBC CORPORATION

                                          By:______________________________
                                          Name:
                                          Title:

Increased Facility Amount                 [NAME OF LENDER]

$

                                          By:______________________________
                                             Name:
                                             Title:

CONSENTED TO:

JPMORGAN CHASE BANK,
as Co-Administrative Agent

By:______________________________
Name:
Title:
<PAGE>
                                                                  SCHEDULE 1.01C

                           EXISTING LETTERS OF CREDIT

<TABLE>
<S>                                                         <C>
Zurich American Insurance Company                           $2,700,000
First Tennessee National Association                        $1,560,000
Traveler's Insurance Company                                $  118,000
Zurich American Insurance Company                           $2,322,000
Traveler's Casualty & Surety Company of American            $  300,000
Total                                                       $7,000,000
</TABLE>
<PAGE>
                                                                   SCHEDULE 2.01

                                   COMMITMENTS

<TABLE>
<CAPTION>
                                          Revolving      Tranche A     Tranche B
                Lender                     Credit        Term Loan     Term Loan       Total
                                          Commitment     Commitment    Commitment
----------------------------------      -------------    ----------    ----------   -----------
<S>                                      <C>            <C>           <C>          <C>
JPMorgan Chase Bank                      $17,482,016    $ 8,920,862   $ 3,597,122   $ 30,000,000
First Tennessee Bank National
Association                              $13,694,245    $ 6,988,009   $ 2,817,746   $ 23,500,000
SunTrust Bank                            $14,568,345    $ 7,434,053   $ 2,997,602   $ 25,000,000
U.S. Bank National Association           $14,568,345    $ 7,434,053   $ 2,997,602   $ 25,000,000
Fleet Capital Corporation                $11,654,676    $ 5,947,242   $ 2,398,082   $ 20,000,000
National City                            $11,654,676    $ 5,947,242   $ 2,398,082   $ 20,000,000
Fifth Third Bank                         $ 8,741,007    $ 4,460,432   $ 1,798,561   $ 15,000,000
Guaranty Bank                            $ 8,741,007    $ 4,460,432   $ 1,798,561   $ 15,000,000
Regions Bank                             $ 8,741,007    $ 4,460,432   $ 1,798,561   $ 15,000,000
Union Planters Bank, N.A.                $ 8,741,007    $ 4,460,432   $ 1,798,561   $ 15,000,000
Compass Bank                             $ 2,913,669    $ 1,486,811   $   599,520   $  5,000,000

Total                                    $121,500,000   $62,000,000   $25,000,000   $208,500,000
</TABLE>
<PAGE>
                                                                   SCHEDULE 2.02

                          FORM OF NEW LENDER SUPPLEMENT

            NEW LENDER SUPPLEMENT (this "New Lender Supplement"), dated
_________________, to the Credit Agreement, dated as of March [31], 2003 (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among TBC Corporation (the "Borrower"), the Lenders party thereto,
the Syndication Agent and Documentation Agents named therein, First Tennessee
National Association, as administrative agent (in such capacity, the
"Administrative Agent") and JPMorgan Chase Bank, as co-administration agent for
the Lenders (in such capacity the "Co-Administrative Agent").

                              W I T N E S S E T H :

            WHEREAS, the Credit Agreement provides in Section 2.02(e) thereof
that any bank, financial institution or other entity may become a party to the
Credit Agreement with the consent of the Borrower and the Co-Administrative
Agent (which consent shall not be unreasonably withheld) by executing and
delivering to the Borrower and the Co-Administrative Agent a supplement to the
Credit Agreement in substantially the form of this New Lender Supplement; and

            WHEREAS, the undersigned now desires to become a party to the Credit
Agreement;

            NOW, THEREFORE, the undersigned hereby agrees as follows:

            1. The undersigned agrees to be bound by the provisions of the
      Credit Agreement, and agrees that it shall, on the date this New Lender
      Supplement is accepted by the Borrower and the Co-Administrative Agent,
      become a Lender for all purposes of the Credit Agreement to the same
      extent as if originally a party thereto, with Revolving Loans of
      $__________.

            2. The undersigned (a) represents and warrants that it is legally
      authorized to enter into this New Lender Supplement; (b) confirms that it
      has received a copy of the Credit Agreement, together with copies of the
      financial statements referred to in Section 3.04 thereof and such other
      documents and information as it has deemed appropriate to make its own
      credit analysis and decision to enter into this New Lender Supplement; (c)
      agrees that it has made and will, independently and without reliance upon
      any agent or any other lender and based on such documents and information
      as it shall deem appropriate at the time, continue to make its own credit
      decisions in taking or not taking action under the Credit Agreement or any
      instrument or document furnished pursuant hereto or thereto; (d) appoints
      and authorizes the Administrative Agent and the Co-Administrative Agent to
      take such action as agent on its behalf and to exercise such powers and
      discretion under the Credit Agreement or any instrument or document
      furnished pursuant hereto or thereto as are delegated to the
      Administrative Agent and the Co-Administrative Agent by the terms thereof,
      together with such powers as are incidental thereto; and (e) agrees that
      it will be bound by the provisions of the Credit Agreement and will
      perform in accordance with its terms all the obligations which by the
      terms of the Credit Agreement are required to be performed by it as a
      Lender including, without limitation, if it is organized under the laws of
      a jurisdiction outside the United States, its obligation pursuant to
      Section 2.16(e) of the Credit Agreement.
<PAGE>
            3. The address of the undersigned for notices for the purposes of
      the Credit Agreement is as follows:

            4. Terms defined in the Credit Agreement shall have their defined
      meanings when used herein.

            IN WITNESS WHEREOF, the undersigned has caused this New Lender
Supplement to be executed and delivered by a duly authorized officer on the date
first above written.

                                            [INSERT NAME OF LENDER]

                                            By________________________________
                                                 Name:
                                                 Title:

Accepted this _____ day of

______________, ____.

TBC CORPORATION

By____________________________
    Name:
    Title:

Accepted this ____ day of

______________, ____.

JPMORGAN CHASE BANK,

as Co-Administrative Agent

By____________________________
     Name:
     Title:
<PAGE>
                                                                   SCHEDULE 3.01

           BORROWER AND SUBSIDIARIES AND JURISDICTIONS OF ORGANIZATION

Borrower: TBC Corporation, A Delaware Corporation ("TBC")

Subsidiaries directly owned by TBC:

<TABLE>
<CAPTION>
              Name                Jurisdiction of     Percentage of Stock/       Subsidiaries
                                    Organization       Equity Owned by TBC
              ----                ---------------     --------------------       ------------
<S>                               <C>                 <C>                        <C>
Big O Tires, Inc.                      Nevada                  100%               See Below
Carroll's, Inc.                       Georgia                  100%                  None
Northern States Tire, Inc.            Delaware                 100%                  None
TBC International Inc.                Delaware                 100%                  None
TBC Retail Enterprises, Inc.          Delaware                 100%               See Below
TBC Brands, LLC                       Delaware                 100%                  None
TBC Capital, LLC                      Delaware                 90%*                  None
</TABLE>

         *5% is owned by each of Carroll's, Inc. and Tire Kingdom, Inc.

Subsidiaries Directly Owned by Big O Tires, Inc.:

<TABLE>
<CAPTION>
              Name                Jurisdiction of     Percentage of Stock       Subsidiaries
                                   Incorporation         Owned by Big O
              ----                ---------------     --------------------       ------------
<S>                               <C>                 <C>                       <C>
Big O Development, Inc.               Colorado                100%                  None
O Advertising, Inc.                   Colorado                100%                  None
Big O Tire of Idaho, Inc.              Idaho                  100%                  None
</TABLE>

Subsidiaries Directly Owned by TBC Retail Enterprises, Inc.:

<TABLE>
<CAPTION>
               Name               Jurisdiction of       Percentage of Stock      Subsidiaries
                                   Incorporation        Owned by TBC Retail
               ----               ---------------       --------------------     ------------
<S>                               <C>                   <C>                      <C>
  Big O Retail Enterprises,          Colorado                  100%                  None
    Inc.

  Tire Kingdom, Inc.                 Florida                   100%               See Below
</TABLE>
<PAGE>
Subsidiaries Directly Owned By Tire Kingdom, Inc.:**

<TABLE>
<CAPTION>
              Name                 Jurisdiction of    Percentage of Stock       Subsidiaries
                                   Incorporation          Owned by TKI
              ----                ---------------     --------------------       ------------
<S>                               <C>                 <C>                        <C>
Merchant's, Incorporated            Delaware                  100%                  See Below
</TABLE>

Subsidiaries Directly Owned By Merchant's, Incorporated:**

<TABLE>
<CAPTION>
              Name                 Jurisdiction of    Percentage of Stock       Subsidiaries
                                   Incorporation       Owned by Merchant's
              ----                ---------------     --------------------       ------------
<S>                               <C>                 <C>                        <C>
Merban, Inc.                        Virginia                    100%                 None
</TABLE>

--------
** After Closing Date of Merchant's Acquisition.
<PAGE>
                                                                   SCHEDULE 3.15

                    TRADEMARKS, TRADENAMES AND SERVICE MARKS

                               TIRE KINGDOM, INC.

TRADEMARK REPORT BY MARK                  PRINTED:3/28/2003               PAGE 1
STATUS:ACTIVE

<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
MISCELLANEOUS [CROWN] DESIGN

UNITED STATES                              9/1/1999    75/791,760    6/27/2000      2,363,324    REGISTERED        35

TIRE KINGDOM

UNITED STATES                              2/5/2003    76/487,769                                   PENDING        35

UNITED STATES                            12/10/1992    74/338,671    5/31/1994      1,838,215    REGISTERED        42

TIRE KINGDOM & DESIGN

UNITED STATES                              2/5/2003    76/487,604                                   PENDING        35

                                                     END OF                              TOTAL ITEMS SELECTED =     4
</TABLE>

                                BIG O TIRES, INC.

TRADEMARK REPORT BY MARK                  PRINTED:3/28/2003               PAGE 1
STATUS:ACTIVE

<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
A REPUTATION YOU CAN RIDE ON
UNITED STATES                             2/22/1993    74/360,838    7/19/1994      1,845,544    REGISTERED      37,42

ASPEN
UNITED STATES                             3/25/1988    73/718,614   10/11/1988      1,508,041    REGISTERED         12

BIG FOOT
CANADA                                    3/15/1988        602897    3/13/1992         395398    REGISTERED          A

MEXICO                                    5/15/1998        332727   10/20/2000         674604    REGISTERED         12

UNITED STATES                              5/7/1993    74/389,931    7/11/1995      1,904,955    REGISTERED         12

BIG FOOT 60

UNITED STATES                              9/6/1974    73/031,264    9/12/1978      1,102,058    REGISTERED         12

BIG FOOT 70

UNITED STATES                             9/16/1974    73/031,311    9/12/1978      1,102,059    REGISTERED         12

BIG HAUL

UNITED STATES                             10/3/1974    73/033,736    8/26/1975      1,018,800    REGISTERED         12

BIG LIFT

CANADA                                     3/9/1998        871625                                   ALLOWED         37

UNITED STATES                             9/17/1997    75/358,399   12/18/2001      2,520,443    REGISTERED      35,37

BIG O

MEXICO                                    5/15/1998        332726   10/20/2000         674603    REGISTERED         12
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
TEXAS                                      9/2/1982           N/A     9/2/1982          40704    REGISTERED         12

TEXAS                                     11/1/1982         40967    11/1/1982          40967    REGISTERED         42

UNITED STATES                             1/14/1974    73/010,921    9/24/1974        993,415    REGISTERED         12

UNITED STATES                             9/10/1973    73/000,572    10/1/1974        994,466    REGISTERED         42

BIG O TIRES

CANADA                                    6/18/1987        586384   10/27/1989         361490    REGISTERED        N/A

CANADA                                     5/5/1999     1,014,484    2/21/2002      TMA558285    REGISTERED   12,35,37

MEXICO                                    5/15/1998        332728   10/20/2000         674605    REGISTERED         42

UNITED STATES                             4/12/1999    75/679,597   12/12/2000      2,411,926    REGISTERED   12,35,37

BIG O TIRES & DESIGN

CANADA                                                               6/12/1981        259,938    REGISTERED        N/A

CANADA                                    3/27/1991        682687   11/12/1993      TMA419439    REGISTERED        N/A

BIG O TIRES AND DESIGN

UNITED STATES                             12/4/1989    74/007,344    8/28/1990      1,611,160    REGISTERED      12,42

COST U LESS & DESIGN
CANADA                                     8/5/1994        761237   10/28/1997      TMA484761    REGISTERED       A,AA

MEXICO                                     8/9/1994        207912   10/11/1994         476693    REGISTERED       37,A

MEXICO                                     8/9/1994        207911    10/5/1994         476099    REGISTERED         42

COSTULESS & Design

UNITED STATES                             7/12/1994    74/548,947    1/30/1996      1,952,457    REGISTERED   12,37,42

DARE TO COMPARE

UNITED STATES                             4/20/2000    76/030,453    9/25/2001      2,492,236    REGISTERED        035

DESIGN OF BIG FOOT

CANADA                                     5/5/1999     1,014,482    3/15/2001     TMA542,415    REGISTERED   12,35,37

UNITED STATES                             4/12/1999    75/680,850     2/1/2000      2,314,775    REGISTERED   12,35,37

EURO TOUR

CANADA                                    1/15/2003       1164833                                   PENDING         12

MEXICO                                     2/3/2003        586480                                   PENDING         12

UNITED STATES                             11/8/2002    76/468,502                                   PENDING         12

EXTRA CARE & DESIGN

UNITED STATES                             3/24/1986       589,583   11/18/1986      1,417,730    REGISTERED         37

UNITED STATES                             3/24/1986    73/589,583   11/18/1986      1,417,730    REGISTERED         37

HYDRO-TRAC

MEXICO                                    1/14/1994        188025     5/4/1994         459327    REGISTERED         12

LEGACY

CANADA                                    3/15/1988        602896    3/13/1992         395397    REGISTERED        N/A

COLORADO                                 10/28/1985           N/A   10/28/1985         T29645    REGISTERED         35

COLORADO                                                             4/22/1976         T30670    REGISTERED

MEXICO                                    1/14/1994        188026     5/4/1994         459328    REGISTERED         12

UNITED STATES                            10/31/1985    73/566,064    5/20/1986      1,393,967    REGISTERED         12
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
LIGHTENING

MEXICO                                    1/14/1994        188027    12/6/1994         481629    REGISTERED      12,35

PATHMAX

UNITED STATES                              8/3/1998    75/529,550    9/28/1999      2,281,419    REGISTERED         12

PROCOMP

MEXICO                                    1/14/1994        188028     5/4/1994         459329    REGISTERED      12,35

PROCOMP HIGH PERFORMANCE

UNITED STATES                             7/27/1992    74/298,320     7/5/1994      1,842,854    REGISTERED         12

SASQUATCH [BIG FOOT] DESIGN

CANADA                                     5/5/1999     1,014,483    1/16/2003      TMA573769    REGISTERED   12,35,37

SONIC COMMERICAL

UNITED STATES                             12/2/1964    72/207,339    3/15/1966        805,578    REGISTERED         12

SUN VALLEY

UNITED STATES                            10/31/1968    72/310,988    6/17/1969        871,318    REGISTERED         35

VENGEANCE

CANADA                                     1/2/2003           N/A                                   PENDING

MEXICO                                     1/7/2003        582675                                   PENDING

UNITED STATES                            10/18/2002    76/460,700                                   PENDING         12

WWW.BIGOTIRES.COM & DESIGN

CANADA                                    3/20/2001       1096649                                   PENDING

MEXICO                                    3/29/2001        478565    8/30/2001         713395    REGISTERED         37

MEXICO                                    3/29/2001        478566                                   PENDING         42

UNITED STATES                             12/1/2000    76/174,243    12/4/2001      2,514,975    REGISTERED      35,37

                                                     END OF                               TOTAL ITEMS SELECTED =    63
</TABLE>

                                 TBC BRANDS, LLC

TRADEMARK REPORT BY MARK                  PRINTED:3/28/2003               PAGE 1
STATUS:ACTIVE

<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
AQUA FLOW

CANADA                                     3/9/1993       724,287    7/15/1994         430478    REGISTERED        N/A

JAPAN                                     8/25/1993      87543/93    7/31/1996        3183343    REGISTERED         12

MEXICO                                    3/24/1993        163889     8/3/1993         438707    REGISTERED         12

UNITED STATES                            11/24/1992    74/334,184     1/4/1994      1,815,411    REGISTERED         12

AQUA FLOW III

CANADA                                     2/5/2001       1091561                                   ALLOWED

MEXICO                                    3/13/2001        475492    5/24/2001         699369    REGISTERED

UNITED STATES                             9/13/2000    76/128,049     4/2/2002      2,557,298    REGISTERED         12

BROADWAY CLASSIC

UNITED STATES                             12/4/2002    76/472,568                                   PENDING         12

CENTRED
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                         <C>          <C>         <C>            <C>         <C>            <C>            <C>
CANADA                                    2/19/1999       1006129   10/18/2000     TMA535,038    REGISTERED         12

MEXICO                                    4/23/1999        372561    2/29/2000         644642    REGISTERED         12

UNITED STATES                             1/15/1999    75/621,314    3/20/2001      2,437,511    REGISTERED         12

CENTRON

UNITED STATES                             3/12/1985    73/526,552     9/3/1985      1,357,941    REGISTERED         12

CENTURY

CANADA                                    9/10/1999     1,028,617   11/22/2002      TMA571137    REGISTERED        N/A

UNITED STATES                             7/30/1999    75/764,830    7/17/2001      2,470,426    REGISTERED         12

CORDOVAN

CANADA                                     3/8/1990       652,673     4/5/1991         382741    REGISTERED         12

CHINA                                     6/28/2002       3225736                                   PENDING         12

EUROPEAN UNION                           12/30/1997        719351     4/7/1999      000719351    REGISTERED       9,12

FRANCE                                    4/25/1991        282653    4/25/1991        1657817    REGISTERED       9,12

GERMANY                                   4/30/1991    T31825/12W    7/14/1992        2017105    REGISTERED       9,12

MEXICO                                   12/19/1997        318673    2/27/1998         571618    REGISTERED         12

SOUTH KOREA                               6/28/2002    2002-30152                                PENDING            12

UNITED KINGDOM                            4/24/1991       1462329    4/24/1991        1462329    REGISTERED         12

UNITED KINGDOM                            5/21/1991       1464865    5/21/1991        1464865    REGISTERED          9

UNITED STATES                             9/27/1985    73/560,572    12/2/1986      1,419,104    REGISTERED      12,17

UNITED STATES                             6/15/1945    72/159,045    8/27/1963        755,493    REGISTERED         35

CORDOVAN BONNEVILLE JET (STYLIZED)

UNITED STATES                             5/19/1964    72/193,756     2/9/1965        784,838    REGISTERED         35

CORDOVAN RADIAL G/T

UNITED STATES                            11/29/1976    73/108,055    9/19/1978      1,102,631    REGISTERED         12

CORDOVAN WIDE 600

UNITED STATES                             8/30/1967    72/279,376     8/6/1968        854,177    REGISTERED         35

CRITERION

UNITED STATES                             2/29/1980    73/252,026    9/15/1981      1,169,191    REGISTERED         12

EPIC

CANADA                                    6/13/2000     1,063,059     8/7/2002      TMA565594    REGISTERED        N/A

MEXICO                                     1/4/1995        220948    3/28/1995         486515    REGISTERED         12

UNITED STATES                             9/10/1985    73/559,173     4/8/1986      1,388,996    REGISTERED         12

EXCEL

CANADA                                    9/10/1999     1,028,616                                   ALLOWED        N/A

UNITED STATES                             7/30/1999    75/764,829    7/17/2001      2,470,425    REGISTERED         12

FRONT LINE & DESIGN

UNITED STATES               T30505US0      5/7/1985    73/536,361    11/5/1985      1,368,849    REGISTERED         12

FRONTLINE

MEXICO                                   10/21/1994        216047    8/30/1995         502347    REGISTERED         12

GRAN ESPRIT

EUROPEAN UNION                            9/19/1996        385617    8/28/1998         385617    REGISTERED         12

UNITED STATES                             5/20/1996    75/107,105    4/14/1998      2,151,303    REGISTERED         12
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
GRAND AM

CANADA                                   12/29/1994       772,065    6/14/1996         459411    REGISTERED         12

MEXICO                                   10/13/1994        215380   11/22/1994         480234    REGISTERED         12

GRAND PRIX

CANADA                                   10/26/1993        739674    3/16/1999     TMA509,415    REGISTERED        N/A

MEXICO                                    11/8/1993        182542                                   PENDING         12

MEXICO                                    8/30/1994        210274   11/18/1994         479812    REGISTERED          7

UNITED STATES                              5/5/1980    73/260,923   12/29/1981      1,183,571    REGISTERED         11

UNITED STATES                            10/26/1982    73/400,864   11/22/1983      1,258,438    REGISTERED          9

UNITED STATES                            12/12/1975    73/071,592   10/25/1977      1,075,901    REGISTERED         12

UNITED STATES                             8/24/1987    73/680,289    8/27/1991      1,655,035    REGISTERED         37

GRAND PRIX & DESIGN

UNITED STATES                             3/17/1982    73/355,136    1/18/1983      1,224,147    REGISTERED         12

UNITED STATES                             3/25/1959    72/070,188   12/22/1959        690,249    REGISTERED         35

GRAND PRIX RADIAL G/T (STYLIZED)

UNITED STATES                              5/5/1980    73/260,924    8/11/1981      1,164,594    REGISTERED         12

GRAND SPIRIT

MEXICO                                    7/24/1995        238249                                   PENDING         12

UNITED STATES                             1/24/1994    74/481,579    2/27/1996      1,958,273    REGISTERED         12

GRAND SPIRIT TOURING LS

UNITED STATES                             12/4/2002    76/472,572                                   PENDING         12

GRAND SPORT

CANADA                                    4/12/1990       654,898     3/6/1992    TMA 395,089    REGISTERED         12

MEXICO                                     1/4/1995        220944    4/23/1997         546167    REGISTERED         12

UNITED STATES                             5/13/1986    73/598,547   12/23/1986      1,421,825    REGISTERED         12

HARVEST KING

CANADA                                   12/29/1994       772,070    1/19/1996      TMA452894    REGISTERED         12

CHINA                                     1/30/2002       3084124                                   ALLOWED         12

MEXICO                                   10/13/1994        215383    7/21/1995         497846    REGISTERED         12

SOUTH KOREA                               6/28/2002    2002-31154                                   PENDING

UNITED STATES                             6/19/1989    73/807,530     5/8/1990      1,595,216    REGISTERED         12

HIGHWAY SCOUT RADIAL HTP

UNITED STATES                             3/17/2000    76/004,068     4/9/2002      2,559,952    REGISTERED         12

LIVE ONE (STYLIZED)

UNITED STATES                             8/10/1976    73/096,101   12/13/1977      1,079,273    REGISTERED          9

MATRIX

BRAZIL                                   10/25/1999     822129833                                   PENDING

UNITED  STATES                            3/13/1985    73/562,619     3/1/1988      1,478,574    REGISTERED         12

MILEAGE MASTER

UNITED STATES                             3/12/2003    76/497,354                                   PENDING

MULTI-MILE
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
CANADA                                    2/29/2000      654903(1)   4/12/1991      TMA383056    REGISTERED         12

CHINA                                     6/28/2002       3225735                                   PENDING         12

EUROPEAN UNION                           12/30/1997        719260     4/7/1999      000719260    REGISTERED       9,12

FRANCE                                    4/24/1991        282446     4/2/1991        1657653    REGISTERED       9,12

MEXICO                                    3/24/1993        163887     7/3/1993         438706    REGISTERED         12

MEXICO                                   10/21/1994        216045    3/22/1995         485680    REGISTERED          9

SOUTH KOREA                               6/28/2002    2002-30153                                   PENDING

UNITED KINGDOM                            4/23/1991       1462051    4/23/1991       B1462051    REGISTERED         12

UNITED KINGDOM                            5/21/1991       1464866    5/21/1991       B1464866    REGISTERED          9

UNITED STATES                             8/23/1982    73/381,561   11/29/1983      1,259,363    REGISTERED         12

UNITED STATES                             5/15/1998    75/485,588     8/3/1999      2,266,907    REGISTERED         12

MULTI-MILE (STYLIZED)

UNITED STATES                             5/11/1950    71/597,256    6/24/1952        560,428    REGISTERED         12

MULTI-MILE RADIAL G/T (STYLIZED)

UNITED STATES                            11/29/1976    73/108,056    9/18/1979      1,125,174    REGISTERED         12

MULTI-MILE WIDE '600'

UNITED STATES                             8/30/1967    72/279,377     8/6/1968        854,178    REGISTERED         35

MULTI-TRAC

MEXICO                                   10/13/1994        215381    7/19/1995         497555    REGISTERED         12

UNITED STATES                             3/22/1973    72/452,297    3/26/1974        981,104    REGISTERED         35

POWER KING

CANADA                                    4/12/1990       654,907     4/5/1991         382759    REGISTERED         12

CHINA                                     1/30/2002       3084106                                   ALLOWED         12

MEXICO                                    6/11/1998        336096                                   PENDING         12

SOUTH KOREA                               6/28/2002    2002-30155                                   PENDING         12

UNITED STATES                              4/5/1979    73/210,451    7/29/1980      1,138,319    REGISTERED         12

POWER KING (STYLIZED)

UNITED STATES                              2/7/1983    73/412,703     4/3/1984      1,272,524    REGISTERED          9

POWER KING IMT

UNITED STATES                             6/21/2002    76/424,630                                   PENDING         12

PR812

UNITED STATES                             11/8/2002    76/468,503                                   PENDING         12

PRESTIGE

CANADA                                    5/27/1959        251153   12/11/1959         116209    REGISTERED        N/A

UNITED STATES                              9/1/1954    71/672,582     6/7/1955        607,037    REGISTERED         35

REGENT

CANADA                                     8/3/2000     1,069,844                                   PENDING

MEXICO                                   11/21/2000        459062    8/16/2002         758958    REGISTERED         12

UNITED STATES                            12/17/1999    75/874,916    6/26/2001      2,464,646    REGISTERED         12

SCEPTOR

UNITED STATES                             5/13/1986    73/598,549   12/23/1986      1,421,827    REGISTERED         12

SHADOW
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
CANADA                                     8/3/2000     1,069,845                                   PENDING

MEXICO                                    9/11/2002        565576                                   PENDING

UNITED STATES*                           12/17/1999    75/874,915                                   PENDING         12

* IN THE NAME OF  TBC CORPORATION

SIGMA

CANADA                                    4/12/1990       654,894     4/5/1991         382758    REGISTERED         12

CHINA                                     6/28/2002       3225734                                   PENDING         12

GERMANY                                   6/10/1991   T32059/12 W    7/14/1992        2017108    REGISTERED         12

MEXICO                                    5/29/1995           N/A    7/27/1995         499136    REGISTERED         12

MEXICO                                    5/29/1995           N/A    7/27/1995         499136    REGISTERED         12

SOUTH KOREA                               6/28/2002    2002-30151                                   PENDING

UNITED KINGDOM                             6/6/1991       1466536     6/6/1991        1466536    REGISTERED         12

UNITED STATES                             5/15/1998    75/485,561    7/20/1999      2,262,889    REGISTERED         12

SIGMA & DESIGN

UNITED STATES                            12/28/1973    73/009,844   11/19/1974        998,427    REGISTERED         12

SIGMA SUPREME HP

CANADA                                     8/3/2000     1,069,847                                   ALLOWED

MEXICO                                   11/21/2000        459065   12/14/2001         728573    REGISTERED

UNITED STATES                             7/26/2000    76/096,412     6/4/2002      2,575,403    REGISTERED         12

SIGMA SUPREME TR

CANADA                                     8/3/2000     1,069,848                                   ALLOWED

MEXICO                                   11/21/2000        459064   12/14/2001         728572    REGISTERED         12

UNITED STATES                            12/17/1999    75/874,912    3/26/2002      2,553,584    REGISTERED         12

SOVRAN

UNITED STATES                             7/27/1989    73/815,288    6/12/1990      1,600,677    REGISTERED         12

STAMPEDE

CANADA                                   12/29/1994       772,066    11/3/1995      TMA449689    REGISTERED         12

MEXICO                                     1/4/1995        220945    3/28/1995         486513    REGISTERED         12

UNITED STATES                             9/18/1984    73/499,961    5/28/1985      1,337,798    REGISTERED         12

SUSSEX

UNITED STATES                             5/13/1986    73/598,548   12/23/1986      1,421,826    REGISTERED         12

TALON

CANADA                                   12/29/1994       772,067    11/3/1995      TMA449690    REGISTERED         12

MEXICO                                     1/4/1995        220943    3/28/1995         486512    REGISTERED         12

UNITED STATES                             9/10/1985    73/559,172     4/8/1986      1,388,995    REGISTERED         12

TBC

MEXICO                                     8/6/1999        385997                                   PENDING         12

UNITED STATES                            10/26/1983    73/449,847     7/2/1985      1,345,491    REGISTERED       9,12

UNITED STATES                             6/13/1978    73/174,209    2/20/1979      1,113,549    REGISTERED         12

UNITED STATES                              6/8/1995    74/685,983   11/25/1997      2,114,992    REGISTERED   35,36,42

TBC BRANDS

UNITED STATES                             2/12/2002    76/369,496                                   ALLOWED    9,12,16
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
TBC ONLINE

CANADA                                    4/16/1998        875566   6/29/2000       TMA529893    REGISTERED          9

MEXICO                                   12/16/1998        340767                                   PENDING          9

UNITED STATES                             1/23/1998    75/423,437    1/25/2000      2,312,424    REGISTERED          9

TBC PRIVATE BRANDS & DESIGN

UNITED STATES                             2/12/2002    76/369,492                                   ALLOWED         35

TEMPEST

CANADA                                     8/3/2000     1,069,846                                   ALLOWED

MEXICO                                   11/21/2000        459063   12/14/2001         728571    REGISTERED         12

UNITED STATES                            12/17/1999    75/874,914    6/19/2001      2,462,822    REGISTERED         12

TODAY

UNITED STATES                             2/25/1994    74/494,330    1/21/1997      2,032,519    REGISTERED         12

TRAIL GUIDE RADIAL ATP

UNITED STATES                             3/17/2000    76/004,067     4/2/2002      2,557,059    REGISTERED         12

TRAIL GUIDE RT

CANADA                                    3/12/2003           N/A                                   PENDING

UNITED STATES                             12/4/2002    76/472,525                                   PENDING         12

TRAIL SCOUT

MEXICO                                    7/30/1999        385267    9/22/1999         624142    REGISTERED         12

UNITED STATES                             4/12/1999    75/679,588     7/3/2001      2,466,356    REGISTERED         12

TRAILER KING

UNITED STATES                             3/12/2003    76/497,369                                   PENDING

TURBO-TECH

UNITED STATES                             7/18/1989    73/813,331    10/2/1990      1,615,599    REGISTERED         12

ULTRA CELL

UNITED STATES                             11/1/1984    73/506,662    6/11/1985      1,340,421    REGISTERED          9

ULTRA LIFE

UNITED STATES                             11/5/1984    73/507,226   11/19/1985      1,371,051    REGISTERED          9

ULTREX

UNITED STATES                             3/16/1994    74/500,719    4/16/1996      1,968,838    REGISTERED         12

VANDERBILT

UNITED STATES                             10/6/1961    72/129,434    6/11/1963        750,869    REGISTERED         12

VANDERBILT TOURING

UNITED STATES                             12/4/2002    76/472,570                                   PENDING         12

WILD COUNTRY

CANADA                                   12/29/1994       772,071    1/19/1996      TMA452895    REGISTERED         12

MEXICO                                     1/4/1995        220947    3/28/1995         486514    REGISTERED         12

UNITED STATES                             6/30/1992    74/289,945     3/2/1993      1,755,187    REGISTERED         12

WILD SPIRIT RADIAL GTX

UNITED STATES                             12/1/1992    74/335,812    2/15/1994      1,822,004    REGISTERED         12
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COUNTRY                                     FILED       APPL#          REGDT        REG#         STATUS       CLASSES
-------                                     -----       -----          -----        ----         ------       -------
<S>                                      <C>         <C>            <C>         <C>            <C>            <C>
WILD SPIRIT TOURING LS

UNITED STATES                             12/4/2002    76/472,571                                   PENDING         12

WILD TRAC

CANADA                                   12/29/1994       772,069     5/9/1997      TMA475995    REGISTERED         12

MEXICO                                     1/4/1995        220937    3/28/1995         486510    REGISTERED         12

UNITED STATES                              7/3/1978    73/177,148    7/17/1979      1,122,304    REGISTERED         12

                                                     END OF                               TOTAL ITEMS SELECTED =   168
</TABLE>

                    MERCHANT'S, INCORPORATED AND MERBAN, INC.
                 (after Closing Date of Merchant's Acquisition)

<TABLE>
<CAPTION>
                                        REGISTRATION NO.            REGISTRATION DATE
                                        ----------------            -----------------
<S>                                     <C>                         <C>
Team Merchant's Performance
Specialists

UNITED STATES                           2,248,803                   09/17/2000

29 Minutes or Less, Tire Express

UNITED STATES                           2,077,075                   07/18/1997

No One Cares for Your Car
Like Merchant's

UNITED STATES                           2,389,988                   09/26/2000

Ready to Roll Tire Pricing

UNITED STATES                           75/564,275                  SUBJECT TO PENDING OPPOSITION FILING

Merchant's Maintenance Alert

UNITED STATES                           2,078,719                   07/15/1997

Merchant's Tire & Auto Center

UNITED STATES                           1,420,446                   11/14/87
                                                                    11/30/92
                                                                    04/05/93

Service That You Trust - Guaranteed

UNITED STATES                           1,743,581                   12/29/1992

Merchant's

UNITED STATES                           1,907,199                   07/28/1995
</TABLE>
<PAGE>
                             COPYRIGHT REGISTRATIONS

<TABLE>
<CAPTION>
TITLE OF WORK                           COPYRIGHT REG. NO.          REG. DATE
-------------                           -----------------           ---------
<S>                                     <C>                         <C>
TBC CORPORATION                         TX-2-920-912                09/21/90
ELECTRONIC ORDERING SYSTEM

INFO-NET USER'S GUIDE                   TX-4-135-989                 11/13/95
(INFO-NET ONLINE; DIRECT
CONNECTION INFO-NET)

INFO-NET ONLINE, RELEASE 4.1            TX-4-168-625                 12/07/95
(INFO-NET ONLINE; DIRECT
CONNECTION INFO-NET)

ELECTRONIC ORDERING SYSTEM              TX-4-212-078                 12/07/95
RELEASE 1.0
</TABLE>
<PAGE>
                                                                SCHEDULE 3.16(a)

                            UCC FILING JURISDICTIONS

                                    Colorado

                               Big O Development, Inc.
                               Big O Retail Enterprises, Inc.
                               O Advertising, Inc.

                                    Delaware

                               Merchant's, Incorporated
                               Northern States Tire, Inc.
                               TBC International Inc.
                               TBC Retail Enterprises, Inc.
                               TBC Brands, LLC
                               TBC Capital, LLC
                               TBC Corporation

                                     Florida

                               Tire Kingdom, Inc.

                                     Georgia

                               Carroll's, Inc.

                                      Idaho

                               Big O Tire of Idaho, Inc.

                                     Nevada

                               Big O Tires, Inc.

                                    Virginia

                               Merban, Inc.
<PAGE>
                                                                SCHEDULE 3.16(b)

                          MORTGAGE FILING JURISDICTIONS

                                    Tennessee

                               TBC Corporation
<PAGE>
                                                                SCHEDULE 4.01(b)

                             FORM OF OPINION LETTER

April 1, 2003

To the Administrative Agent, the Co-Administrative Agent,
the Collateral Agent, and the Lenders who are
parties to the agreements described below.

Ladies and Gentlemen:

We have acted as counsel to TBC Corporation, a Delaware Corporation (the
"Borrower"), in connection with (i) its execution and delivery of a Credit
Agreement, dated as of March 31, 2003 (the "Credit Agreement"), among the
Borrower, the lenders party thereto, First Tennessee Bank National Association,
as administrative agent (the "Administrative Agent"), and JP Morgan Chase Bank
as Co-Administrative Agent (the "Co-Administrative Agent"); (ii) its execution
and delivery of a Guarantee and Collateral Agreement, dated March 31, 2003 (the
"Guarantee and Collateral Agreement"), in favor of JP Morgan Chase Bank, as
Collateral Agent (the "Collateral Agent"); (iii) its execution and delivery of
an Acknowledgment and Agreement to the Intercreditor Agreement, dated as of
March 31, 2003 (the "Acknowledgment"), among the lenders party to the Credit
Agreement, The Prudential Insurance Company of America ("Prudential"), and
certain affiliates of Prudential (collectively, the "Lenders"); and (iv) the
transactions contemplated by the Credit Agreement, the Guarantee and Collateral
Agreement, and the Acknowledgment.

We have also acted as counsel to TBC International Inc., a Delaware Corporation
("TBCI"), Carroll's, Inc., a Georgia Corporation ("Carroll's"), Big O Tires,
Inc., a Nevada corporation ("Big O"), Big O Tire of Idaho, Inc., an Idaho
Corporation ("Idaho"), TBC Retail Enterprises, Inc., a Delaware Corporation
("TBC Retail"), Tire Kingdom, Inc., a Florida Corporation ("Tire Kingdom"),
Northern States Tire, Inc., a Delaware Corporation ("NST"), Big O Retail
Enterprises, Inc., a Colorado Corporation ("Bore"), Big O Development, Inc., a
Colorado Corporation ("BODI"), O Advertising, Inc., a Colorado Corporation ("O
Advertising"), TBC Brands, LLC, a Delaware limited liability company ("TBC
Brands"), TBC Capital, LLC, a Delaware limited liability company ("TBC
Capital"), Merchant's, Incorporated, a Delaware Corporation ("Merchants"), and
Merban, Inc., a Virginia Corporation ("Merban"), in connection with (i) the
execution and delivery by each of the Guarantee and Collateral Agreement; and
(ii) the consummation of the transactions contemplated thereby.

We have also acted as counsel to the Borrower, Big O, Tire Kingdom, Merchants
and TBC Retail in connection with the execution and delivery of blank stock
powers relating to the capital stock or membership interests owned by each in
any of the Subsidiaries (collectively, the "Stock Powers").
<PAGE>
We have also acted as counsel to the Borrower, TBCI, TBC Retail, NST, TBC
Brands, TBC Capital and Merchants in connection with the delivery of UCC-1
financing statements (the "Financing Statements") to be filed with the Secretary
of State of Delaware.

This opinion is being delivered pursuant to Section 4.01(b) of the Credit
Agreement. All capitalized terms used in this opinion but not defined herein
shall have the meanings given to them in the Credit Agreement, as the context
indicates.

We have examined the Credit Agreement, the Guarantee and Collateral Agreement,
the Acknowledgment, and the Stock Powers (collectively, the "Transaction
Documents"), together with telecopied facsimiles of the signature pages of each
of the foregoing. we have also examined such other documents, certificates of
officers of Borrower and its Subsidiaries or public officials, and corporate
records, and have made investigation of such other matters, as in our judgment
permit us to render an informed opinion on the matters set forth herein.

In connection with our examination, we have assumed that the execution copies of
the Transaction Documents conform to the copies of such documents delivered to
us by counsel to the Lenders. We have also assumed the genuineness of all
signatures (other than those on behalf of Borrower or any Subsidiary), the
authenticity of all documents submitted to us as originals, the conformity with
the originals of all documents submitted to us as copies or telecopied
facsimiles, and the authenticity of the originals of such latter documents.
Further, with your consent, with respect to the Lenders, the Administrative
Agent, the Co-Administrative Agent, and the Collateral Agent, we have assumed
the legal power of each to enter into and perform the Transaction Documents to
which they are parties, and the due authorization, execution, and delivery of
the Transaction Documents to which they are parties, and we have relied on all
representations or warranties contained in the Transaction Documents insofar as
they relate to matters of fact not within our knowledge.

Based upon the foregoing and subject to the last two paragraphs of this letter,
we are of the opinion that:

1. Each of the Borrower and the Subsidiaries is a corporation duly incorporated
or a limited liability company duly organized, validly existing, and in good
standing under the laws of its state of incorporation or organization and has
all requisite authority to conduct its business as now being conducted.

2. The execution and delivery of the Transaction Documents by the Borrower and
each Subsidiary which is a party thereto, and the performance by Borrower and
each Subsidiary of their respective obligations thereunder, have been duly
authorized by all necessary actions and proceedings and will not:

      (a) Require any consent of the stockholders of Borrower or the stockholder
      or members of any Subsidiary which has not been obtained.
<PAGE>
      (b) Violate any law, rule, regulation, order, writ, judgment, injunction,
      decree, or award of which we are aware and which is binding on the
      Borrower or any Subsidiary; violate the Certificate or Articles of
      Incorporation, By-Laws, Certificate of Formation, or Limited Liability
      Company Agreement of Borrower or any Subsidiary; or violate any indenture,
      instrument, or agreement of which we are aware and which is binding upon
      Borrower or any Subsidiary.

      (c) Result in the creation or imposition of any Lien pursuant to the
      provisions of any indenture, instrument, or agreement of which we are
      aware and which is binding upon Borrower or any Subsidiary, other than
      such as may be created pursuant to the Transaction Documents.

3. The Transaction Documents to which the Borrower is a party have been duly
executed and delivered by Borrower and constitute legal, valid, and binding
obligations of Borrower. The Transaction Documents to which each Subsidiary is a
party have been duly executed and delivered by the Subsidiary and constitute
legal, valid, and binding obligations of the Subsidiary. The Transaction
Documents to which Borrower or Any Subsidiary is a party are enforceable against
Borrower or the Subsidiary, as the case may be, in accordance with their
respective terms, except to the extent that the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium, or similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity, regardless of whether enforcement is sought at law or in
equity. Notwithstanding the foregoing, no opinion is expressed with respect to
any provision that purports to consent to the jurisdiction of any court, waive
objections to venue, or require payment or reimbursement of attorneys' fees,
court costs, or other expenses of collection or enforcement.

4. To our knowledge, there is no litigation or proceeding pending or threatened
against the Borrower or any of the Subsidiaries which, if adversely determined,
could reasonably be expected to have a material adverse effect or which involve
the Credit Agreement, any Other Transaction Document, or the transactions
contemplated thereby.

5. No approval, authorization, consent, adjudication, or order of any
Governmental Authority, which has not been obtained by the Borrower or any
Subsidiary, is required to be obtained by any of them in connection with the
transactions contemplated by the Credit Agreement.

6. The Guarantee and Collateral Agreement creates a valid security interest
under Section 9-201 of the Uniform Commercial Code in favor of the Collateral
Agent, in all right, title, and interest, if any, of the Borrower and the
Subsidiaries in those items and types of personal property constituting the
Collateral, as such term is defined in the Guarantee and Collateral Agreement,
in which a security interest may be created under Article 9 of the Uniform
Commercial Code and the federal trademark laws, rules, and regulations, as the
case may be. Upon the filing and proper indexing of the Financing Statements in
the office of the Secretary of State of Delaware, the Collateral Agent will have
a perfected security interest in that portion of the Collateral in which a
security interest may be perfected by filing a financing statement under
<PAGE>
Article 9 of the Uniform Commercial Code of the State of Delaware, in effect on
the date hereof (the "Delaware UCC").

We express no opinion with respect to (i) the perfection or priority of liens on
the Collateral, except as set forth in the preceding sentence; or (ii) the
creation, attachment or perfection of Liens on any Collateral consisting of
fixtures, within the meaning of Article 9 of the Uniform Commercial Code or the
Delaware UCC, or any Collateral located outside of the United States or
consisting of any intellectual property subject to the laws of any jurisdiction
other than the federal laws of the United States. Furthermore, the opinions set
forth herein are subject to the following qualifications:

      a. We express no opinion as to title or interest in any property, real or
personal.

      b. We call to your attention that (i) the perfection of the Collateral
Agent's security interest in the Collateral will be terminated as to any such
property acquired by any Borrower or Subsidiary more than four months after such
party changes its name so as to make the respective Financing Statement
seriously misleading unless amendments indicating the new name of such debtor
are properly filed before the expiration of such four month period, and (ii) the
Delaware UCC requires the filing of continuation statements within the period of
six months prior to the expiration of five years from the date of the filing of
the original Financing Statements or the expiration of any subsequent period of
continuation in order to maintain the effectiveness of the original Financing
Statements.

      C. The opinion set forth in paragraph 6 above is given on the assumptions
that value has been given by the Collateral Agent and Lenders to the Borrower
and Subsidiaries and that the Borrower and Subsidiaries have rights in the
Collateral. Our opinions with respect to the proper filing office for the
Financing Statements is limited to the Delaware UCC.

      d. We express no opinion as to the creation or perfection of a security
interest in any commercial tort claim.

      e. We express no opinion with respect to (A) the creation, attachment or
perfection of any security interest (1) in any Collateral of a type represented
by a certificate of title, (2) in any proceeds, and (3) in any Collateral
consisting of money or Permitted Investments; or (B) the effect of Section 552
of the Bankruptcy Code (11 U.S.C. 552) (relating to property acquired by a
debtor after the commencement of a case under the United States Bankruptcy Code
with respect to such debtor) and Section 506(c) of the Bankruptcy Code (11
U.S.C. 506(c)) (relating to certain costs and expenses of a trustee in
preserving or disposing of collateral).

We are members of the bar of the State of Ohio, and we express no opinion as to
matters governed by any laws other than those of the State of Ohio, the federal
laws of the United States, the corporate and limited liability company laws of
the State of Delaware, and the Delaware UCC. As to matters involving the laws of
any other jurisdiction, we have assumed with your consent that the laws of that
jurisdiction are the same as the laws of the State of Ohio in all respects
material to this opinion; however, for purposes of this opinion, we express no
opinion as to any matter involving choice of law or conflicts of law.
<PAGE>
The opinions that are expressed herein are as of the date hereof, are solely for
your benefit, and may not be relied upon in any manner for any purpose by any
person or entity other than the Administrative Agent, the Co-Administrative
Agent, the Collateral Agent, the Lenders, and their participants, assignees, and
other transferees. We disclaim any undertaking or obligation to advise you of
any changes in the conclusions or other matters covered herein that hereafter
may come to our attention.

Very truly yours,

<PAGE>
                                                                SCHEDULE 4.01(f)

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

                       GUARANTEE AND COLLATERAL AGREEMENT

                                     made by

                                 TBC CORPORATION

                         and certain of its Subsidiaries

                                   in favor of

                              JP MORGAN CHASE BANK,
                               as Collateral Agent

                           Dated as of March 31, 2003

================================================================================
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                      Page
                                                                                                                      ----
<S>                                                                                                                   <C>
Section 1.        DEFINED TERMS..................................................................................       5

         1.1      Definitions....................................................................................       5
         1.2      Other Definitional Provisions..................................................................       9

Section 2.        Guarantee......................................................................................       9

         2.1      Guarantee......................................................................................       9
         2.2      Right of Contribution..........................................................................      10
         2.3      No Subrogation.................................................................................      10
         2.4      Amendments, etc. with respect to the Borrower Obligations......................................      11
         2.5      Guarantee Absolute and Unconditional...........................................................      11
         2.6      Remedies.......................................................................................      12
         2.7      Reinstatement..................................................................................      12
         2.8      Payments.......................................................................................      12
         2.9      Application of Guarantee Payments and Recoveries...............................................      12

Section 3.        GRANT OF SECURITY INTEREST.....................................................................      13

Section 4.        REPRESENTATIONS AND WARRANTIES.................................................................      14

         4.1      Execution, Delivery and Performance............................................................      14
         4.2      Title; No Other Liens..........................................................................      14
         4.3      Perfected First Priority Liens.................................................................      15
         4.4      Jurisdiction of Organization; Chief Executive Office...........................................      15
         4.5      Farm Products..................................................................................      15
         4.6      Investment Property............................................................................      15
         4.7      Receivables....................................................................................      16
         4.8      Intellectual Property..........................................................................      16

Section 5.        COVENANTS......................................................................................      16

         5.1      Delivery of Instruments, Certificated Securities and Chattel Paper.............................      16
         5.2      Maintenance of Insurance.......................................................................      16
         5.3      Payment of Obligations.........................................................................      17
         5.4      Maintenance of Perfected Security Interest; Further Documentation..............................      17
         5.5      Changes in Locations, Name, etc................................................................      17
</TABLE>

                                        i
<PAGE>
<TABLE>
<S>                                                                                                                   <C>
         5.6      Notices........................................................................................      17
         5.7      Investment Property............................................................................      18
         5.8      Intellectual Property..........................................................................      18

Section 6.        REMEDIAL PROVISIONS............................................................................      19

         6.1      Certain Matters Relating to Receivables........................................................      19
         6.2      Communications with Obligors; Grantors Remain Liable...........................................      19
         6.3      Pledged Stock..................................................................................      20
         6.4      Proceeds to be Turned Over To Collateral Agent.................................................      21
         6.5      Application of Proceeds........................................................................      21
         6.6      Code and Other Remedies........................................................................      21
         6.7      Sale of Pledged Stock..........................................................................      22
         6.8      Deficiency.....................................................................................      22

Section 7.        THE COLLATERAL AGENT...........................................................................      22

         7.1      Collateral Agent's Appointment as Attorney-in-Fact, etc........................................      22
         7.2      Duty of Collateral Agent.......................................................................      24
         7.3      Execution of Financing Statements..............................................................      24
         7.4      Authority of Collateral Agent..................................................................      24

Section 8.        MISCELLANEOUS..................................................................................      24

         8.1      Amendments in Writing..........................................................................      24
         8.2      Notices........................................................................................      24
         8.3      No Waiver by Course of Conduct; Cumulative Remedies............................................      25
         8.4      Enforcement Expenses; Indemnification..........................................................      25
         8.5      Successors and Assigns.........................................................................      25
         8.6      Set-Off........................................................................................      25
         8.7      Counterparts...................................................................................      26
         8.8      Severability...................................................................................      26
         8.9      Section Headings...............................................................................      26
         8.10     Integration....................................................................................      26
         8.11     GOVERNING LAW..................................................................................      26
         8.12     Submission To Jurisdiction; Waivers............................................................      26
         8.13     Acknowledgements...............................................................................      27
         8.14     Additional Grantors............................................................................      27
         8.15     Releases.......................................................................................      27
         8.16     WAIVER OF JURY TRIAL...........................................................................      28
         8.17     Continuation of Liens Securing Existing Prudential Notes.......................................      28
</TABLE>
<PAGE>
<TABLE>
<S>                                                                                                                   <C>
         8.18     Existing Guarantees............................................................................      28
</TABLE>

SCHEDULES

Schedule 1        Notice Addresses
Schedule 2        Pledged Stock
Schedule 3        Jurisdictions of Organization and Chief Executive Offices
Schedule 4        Intellectual Property
<PAGE>
                       GUARANTEE AND COLLATERAL AGREEMENT

                  GUARANTEE AND COLLATERAL AGREEMENT, dated as of March 31,
2003, made by each of the signatories hereto (together with any other entity
that may become a party hereto as provided herein, the "Grantors"), in favor of
JP Morgan Chase Bank, as Collateral Agent (in such capacity, the "Collateral
Agent") for (i) the banks and other financial institutions or entities (the
"Lenders") from time to time parties to the Credit Agreement, dated as of March
31, 2003 (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among TBC Corporation (the "Borrower"), the Lenders, the
Administrative Agent and the Co-Administrative Agent and (ii) The Prudential
Insurance Company of America ("Prudential") party to the Second Amended and
Restated Note Agreement dated as of April 1, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Existing Note Agreement") between
Prudential and the Borrower and party to the Note Purchase Agreement dated as of
April 1, 2003 (as amended, supplemented or otherwise modified from time to time,
the "Additional Note Agreement") among Prudential, certain affiliates, managed
accounts or funds of Prudential (the "Prudential Affiliates") and the Borrower
(the Existing Note Agreement and the Additional Note Agreement collectively
referred to as the "Note Agreements") (the Lenders, Prudential and the
Prudential Affiliates being collectively referred to as the "Secured Parties").

                              W I T N E S S E T H:

                  WHEREAS, pursuant to the Credit Agreement, the Lenders have
severally agreed to make extensions of credit to the Borrower upon the terms and
subject to the conditions set forth therein;

                  WHEREAS, pursuant to the Existing Note Agreement, the Borrower
has outstanding certain Series A Senior Notes, Series B Senior Notes and Series
C Senior Notes (as amended, supplemented or otherwise modified from time to
time, the foregoing collectively referred to as the "Existing Prudential Notes")
held by Prudential;

                  WHEREAS, the Existing Prudential Notes are presently secured
by, inter alia, certain liens granted by the Grantors pursuant to those certain
Amended and Restated Security Agreements (the "Existing Security Agreements"),
each dated as of January 5, 2001, from the Borrower and each of the other
Grantors party hereto, in favor of the Collateral Agent;

                  WHEREAS, pursuant to the Additional Note Agreement, the
Borrower has issued to Prudential certain Series D Variable Rate Senior Secured
Notes due April 16, 2009 (as amended, supplemented or otherwise modified from
time to time, the "Additional Prudential Notes");

                  WHEREAS, the Borrower is a member of an affiliated group of
companies that includes, or with regard to Merchant's, Incorporated and Merban,
Inc., that will include upon completion of the Merchant's Acquisition, each
other Grantor;

                  WHEREAS, the proceeds of the extensions of credit under the
Credit Agreement and the proceeds from the issuance of the Additional Prudential
Notes will be used in part to enable the Borrower to make valuable transfers to
one or more of the other Grantors in connection with the operation of their
respective businesses;

                  WHEREAS, the Borrower has requested that Prudential consent to
the Borrower's execution of the Credit Agreement, which consent is required
under the Existing
<PAGE>
Note Agreement, and Prudential has agreed to provide such consent, provided,
inter alia, that the Grantors shall have executed and delivered this Agreement
to the Collateral Agent for the ratable benefit of the Secured Parties;

                  WHEREAS, the Borrower and the other Grantors are engaged in
related businesses, and each Grantor will derive substantial direct and indirect
benefit from the making of the extensions of credit under the Credit Agreement,
and the issuance of Additional Prudential Notes under the Additional Note
Agreement;

                  WHEREAS, it is a condition precedent to the obligation of the
Lenders to make their respective extensions of credit to the Borrower under the
Credit Agreement, the amendment and restatement of the Existing Prudential Notes
under the Existing Note Agreement and the issuance of Additional Prudential
Notes under the Additional Note Agreement that the Grantors shall have executed
and delivered this Agreement to the Collateral Agent for the ratable benefit of
the Secured Parties; and

                  NOW, THEREFORE, in consideration of the premises and to induce
the Lenders to enter into the Credit Agreement and to make their respective
extensions of credit to the Borrower thereunder and to induce Prudential to give
its consent required under the Existing Note Agreement and to purchase the
Additional Prudential Notes under the Additional Note Agreement, each Grantor
hereby agrees with the Collateral Agent, for the ratable benefit of the Secured
Parties, as follows:

                             ARTICLE I DEFINED TERMS

                  SECTION 1.01. Definitions. (a) The following terms are used
herein as defined in the New York UCC: Accounts, Certificated Security, Chattel
Paper, Commercial Tort Claims, Documents, Equipment, Farm Products, General
Intangibles, Instruments, Inventory, Letter-of-Credit Rights and Supporting
Obligations.

                  (a) The following terms shall have the following meanings:

                  "ABR Loans": as defined in the Credit Agreement. "Additional
Note Agreement": as defined in the Preamble hereto.

                  "Additional Prudential Notes": as defined in the recitals
hereto.

                  "Administrative Agent": as defined in the Credit Agreement.

                  "Agreement": this Guarantee and Collateral Agreement, as the
same may be amended, supplemented or otherwise modified from time to time.

                  "Borrower": as defined in the preamble hereto.

                  "Borrower Obligations": the collective reference to the unpaid
principal of and interest on the Prudential Notes, the Loans and Reimbursement
Obligations and all other obligations and liabilities of the Borrower
(including, without limitation, interest accruing at the then applicable rate
provided in the Credit Agreement, the Note Agreements and the Prudential Notes
after the maturity of the Loans, the Reimbursement Obligations and the
Prudential Notes and interest accruing at the then applicable rate provided in
the Credit Agreement after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) to the Collateral Agent or any Secured Party,
whether
<PAGE>
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, the Credit Agreement, the Note Agreements, the Prudential Notes, this
Agreement, any Mortgage, any Letter of Credit and any guarantee of the
Borrower's obligations in respect of any of the foregoing as from time to time
in effect, or any other document made, delivered or given in connection with any
of the foregoing, in each case whether on account of principal, interest,
reimbursement obligations, Make-Whole Amounts, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and disbursements
of counsel to the Collateral Agent or to the Secured Parties that are required
to be paid by the Borrower pursuant to the terms of any of the foregoing
agreements) (collectively, the "Loan Documents").

                  "Business Day": as defined in the Credit Agreement.

                  "Capital Stock" shall mean any class of capital stock, share
capital or similar equity interest of a Person.

                  "Co-Administrative Agent": as defined in the Credit Agreement.

                  "Collateral": as defined in Section 3.

                  "Collateral Account": any collateral account established by
the Collateral Agent as provided in Section 6.1 or 6.4.

                  "Collateral Agent":  as defined in the Preamble hereto.

                  "Copyrights": (i) all copyrights arising under the laws of the
United States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished (including,
without limitation, those listed in Schedule 4), all registrations and
recordings thereof, and all applications in connection therewith, including,
without limitation, all registrations, recordings and applications in the United
States Copyright Office, and (ii) the right to obtain all renewals thereof.

                  "Commitments": as defined in the Credit Agreement.

                  "Credit Agreement": as defined in the preamble hereto.

                  "Default": shall mean a "Default" as defined in the Credit
Agreement or in either of the Note Agreements.

                  "Deposit Account": as defined in the Uniform Commercial Code
of any applicable jurisdiction and, in any event, including, without limitation,
any demand, time, savings, passbook or like account maintained with a depositary
institution.

                  "Event of Default": shall mean an "Event of Default" as
defined in the Credit Agreement or in either of the Note Agreements.

                  "Existing Note Agreement": as defined in the Preamble hereto.

                  "Existing Security Agreements": as defined in the recitals
hereto.

                  "Existing Prudential Notes": as defined in the recitals
hereto.

                  "Foreign Subsidiary": any Subsidiary organized under the laws
of any jurisdiction outside the United States of America.
<PAGE>
                  "Foreign Subsidiary Voting Stock": the voting Capital Stock of
any Foreign Subsidiary.

                  "GAAP": as defined in the Credit Agreement.

                  "Governmental Authority": as defined in the Credit Agreement.

                  "Grantors": as defined in the preamble hereto.

                  "Guarantee": as defined in Section 2.1(a).

                  "Guarantor Obligations": with respect to any Guarantor, all
obligations and liabilities of such Guarantor which may arise under or in
connection with this Agreement (including, without limitation, Section 2), the
Note Agreements, the Prudential Notes or any other Loan Document to which such
Guarantor is a party, in each case whether on account of guarantee obligations,
reimbursement obligations, Make-Whole Amounts, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and disbursements
of counsel to the Collateral Agent or to the Secured Parties that are required
to be paid by such Guarantor pursuant to the terms of this Agreement, the Note
Agreements or any other Loan Document).

                  "Guarantors": the collective reference to each Grantor other
than the Borrower, Merchant's Incorporated and Merban, Inc.

                  "Guarantee Related Payment": as defined in Section 2.9.

                  "Intellectual Property": the collective reference to all
rights, priorities and privileges relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including, without limitation, the Copyrights, the Patents and the Trademarks,
and all rights to sue at law or in equity for any infringement or other
impairment thereof, including the right to receive all proceeds and damages
therefrom.

                  "Intercompany Note": any promissory note evidencing loans made
by any Grantor to the Borrower or any of its Subsidiaries.

                  "Intercreditor Agreement": the Intercreditor Agreement among
Prudential, each Lender, the Administrative Agent, the Co-Administrative Agent
and the Collateral Agent, dated as of March 31, 2003.

                  "Investment Property": the collective reference to (i) all
"investment property" as such term is defined in Section 9-102(a)(49) of the New
York UCC (other than any Foreign Subsidiary Voting Stock excluded from the
definition of "Pledged Stock") and (ii) whether or not constituting "investment
property" as so defined, all Pledged Notes and all Pledged Stock.

                  "Issuers": the collective reference to each issuer of any
Investment Property.

                  "Letter of Credit": as defined in the Credit Agreement.

                  "Lender Party": as defined in Section 2.6.

                  "Lenders":  as defined in the preamble hereto.

                  "Lien": as defined in the Credit Agreement.

                  "Loan Document(s)" is defined within the definition of
"Borrower Obligations".
<PAGE>
                  "Loans": as defined in the Credit Agreement.

                  "Make-Whole Amount": as defined in the Note Agreements.

                  "Mortgage": as defined in the Credit Agreement.

                  "New York UCC": the Uniform Commercial Code as from time to
time in effect in the State of New York.

                  "Note Agreements": as defined in the Preamble hereto.

                  "Obligations": (i) in the case of the Borrower, Merchant's
Incorporated and Merban, Inc., the Borrower Obligations, and (ii) in the case of
each Guarantor, its Guarantor Obligations.

                  "Patents": (i) all letters patent of the United States, any
other country or any political subdivision thereof, all reissues and extensions
thereof and all goodwill associated therewith, including, without limitation,
any of the foregoing referred to in Schedule 4, (ii) all applications for
letters patent of the United States or any other country and all divisions,
continuations and continuations-in-part thereof, including, without limitation,
any of the foregoing referred to in Schedule 4, and (iii) all rights to obtain
any reissues or extensions of the foregoing.

                  "Person": shall mean and include an individual, a partnership,
a joint venture, a corporation, a trust, an unincorporated organization, a
limited liability company and a government or any department or agency thereof.

                  "Pledged Notes": all Intercompany Notes at any time issued to
any Grantor and all other promissory notes issued to or held by any Grantor
(other than promissory notes issued in connection with extensions of trade
credit by any Grantor in the ordinary course of business).

                  "Pledged Stock": the shares of Capital Stock listed on
Schedule 2, together with any other shares, stock certificates, options,
interests or rights of any nature whatsoever in respect of the Capital Stock of
any Person that may be issued or granted to, or held by, any Grantor while this
Agreement is in effect; provided that in no event shall more than 66% of the
total outstanding Foreign Subsidiary Voting Stock of any Foreign Subsidiary be
required to be pledged hereunder.

                  "Proceeds": all "proceeds" as such term is defined in Section
9-102(a)(64) of the New York UCC and, in any event, shall include, without
limitation, all dividends or other income from the Investment Property,
collections thereon or distributions or payments with respect thereto.

                  "Prudential": as defined in the Preamble hereto.

                  "Prudential Affiliates": as defined in the Preamble hereto.

                  "Prudential Notes": the collective reference to the Existing
Prudential Notes and the Additional Prudential Notes.

                  "Receivable": any right to payment for goods sold or leased or
for services rendered, whether or not such right is evidenced by an Instrument
or Chattel Paper and whether or not it has been earned by performance
(including, without limitation, any Account).
<PAGE>
                  "Reimbursement Obligations": as defined in the Credit
Agreement.

                  "Required Lenders": as defined in the Credit Agreement.

                  "Required Noteholders": shall mean the holder or holders of at
least 51% of the aggregate principal amount of each of the Existing Prudential
Notes and the Additional Prudential Notes.

                  "Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.

                  "Secured Parties": as defined in the Preamble hereto.

                  "Securities Act": the Securities Act of 1933, as amended.

                  "Subsidiary": as defined in the Credit Agreement.

                  "Trademarks": (i) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade styles,
service marks, logos and other source or business identifiers, and all goodwill
associated therewith, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof or any other
country or any political subdivision thereof, or otherwise, and all common-law
rights related thereto, including, without limitation, any of the foregoing
referred to in Schedule 4, and (ii) the right to obtain all renewals thereof.

                  SECTION 1.02. Other Definitional Provisions. (b) The words
"hereof," "herein", "hereto" 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, and Section and Schedule references are
to this Agreement unless otherwise specified.

                  (a) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.

                  (b) Where the context requires, terms relating to the
Collateral or any part thereof, when used in relation to a Grantor, shall refer
to such Grantor's Collateral or the relevant part thereof.

                              ARTICLE II GUARANTEE

                  SECTION 2.01. Guarantee. (c) Each of the Guarantors hereby,
jointly and severally, unconditionally and irrevocably, guarantees (the
"Guarantee") to the Secured Parties and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by the
Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Borrower Obligations.

                  (a) Anything herein or in any other Loan Document or the
Intercreditor Agreement to the contrary notwithstanding, the maximum liability
of each Guarantor hereunder and under the other Loan Documents or the
Intercreditor Agreement shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws
<PAGE>
relating to the insolvency of debtors (after giving effect to the right of
contribution established in Section 2.2).

                  (b) Each Guarantor agrees that the Borrower Obligations may at
any time and from time to time exceed the amount of the liability of such
Guarantor hereunder without impairing the guarantee contained in this Section 2
or affecting the rights and remedies of the Collateral Agent or any Secured
Party hereunder. Each Guarantor shall give notice at the time of any payment by
it hereunder to the recipient of such payment and to the Collateral Agent.

                  (c) The guarantee contained in this Section 2 shall remain in
full force and effect until all the Borrower Obligations and the obligations of
each Guarantor under the guarantee contained in this Section 2 shall have been
satisfied by payment in full, no Letter of Credit shall be outstanding and the
Commitments shall be terminated, notwithstanding that from time to time during
the term of the Credit Agreement or the Note Agreements the Borrower may be free
from any Borrower Obligations.

                  (d) No payment made by the Borrower, any of the Guarantors,
any other guarantor or any other Person or received or collected by the
Collateral Agent or any Secured Party from the Borrower, any of the Guarantors,
any other guarantor or any other Person by virtue of any action or proceeding or
any set-off or appropriation or application at any time or from time to time in
reduction of or in payment of the Borrower Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor
hereunder which shall, notwithstanding any such payment, remain liable for the
Borrower Obligations up to the maximum liability of such Guarantor hereunder
until the Borrower Obligations are paid in full, no Letter of Credit shall be
outstanding and the Commitments are terminated.

                  SECTION 2.02. Right of Contribution. Each Guarantor hereby
agrees that to the extent that a Guarantor shall have paid more than its
proportionate share of any payment made hereunder, such Guarantor shall be
entitled to seek and receive contribution from and against any other Guarantor
hereunder which has not paid its proportionate share of such payment. Each
Guarantor's right of contribution shall be subject to the terms and conditions
of Section 2.3. The provisions of this Section 2.2 shall in no respect limit the
obligations and liabilities of any Guarantor to the Collateral Agent and the
Secured Parties, and each Guarantor shall remain liable to the Collateral Agent
and the Lenders for the full amount guaranteed by such Guarantor hereunder.

                  SECTION 2.03. No Subrogation. Notwithstanding any payment made
by any Guarantor hereunder or any set-off or application of funds of any
Guarantor by the Collateral Agent or any Secured Party, no Guarantor shall be
entitled to be subrogated to any of the rights of the Collateral Agent or any
Secured Party against the Borrower or any other Guarantor or any collateral
security or guarantee or right of offset held by the Collateral Agent or any
Secured Party for the payment of the Borrower Obligations, nor shall any
Guarantor seek or be entitled to seek any contribution or reimbursement from the
Borrower or any other Guarantor in respect of payments made by such Guarantor
hereunder, until all amounts owing to the Collateral Agent and the Secured
Parties by the Borrower on account of the Borrower Obligations are paid in full,
no Letter of Credit shall be outstanding and the Commitments are terminated. If
any amount shall be paid to any Guarantor on account of such subrogation rights
at any time when all of the Borrower Obligations shall not have been paid in
full, such amount shall be held by such Guarantor in trust for the Collateral
Agent and the Secured Parties, segregated from other funds of such Guarantor,
and shall, forthwith upon receipt by such Guarantor, be turned over to the
Collateral Agent in the exact form received by such Guarantor (duly indorsed by
such Guarantor to the Collateral Agent, if required), to be applied against the
Borrower Obligations, whether matured or unmatured, in such order as the
Collateral Agent may determine.
<PAGE>
                  SECTION 2.04. Amendments, etc. with respect to the Borrower
Obligations. Each Guarantor shall remain obligated hereunder notwithstanding
that, without any reservation of rights against any Guarantor and without notice
to or further assent by any Guarantor, any demand for payment of any of the
Borrower Obligations made by the Collateral Agent or any Secured Party may be
rescinded by the Collateral Agent or such Secured Party and any of the Borrower
Obligations continued, and the Borrower Obligations, or the liability of any
other Person upon or for any part thereof, or any collateral security or
guarantee therefor or right of offset with respect thereto, may, from time to
time, in whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by the Collateral Agent or any
Secured Party, and the Credit Agreement, the Note Agreements, the Prudential
Notes and the other Loan Documents and any other documents executed and
delivered in connection therewith may be amended, modified, supplemented or
terminated, in whole or in part, and any collateral security, guarantee or right
of offset at any time held by the Collateral Agent or any Secured Party for the
payment of the Borrower Obligations may be sold, exchanged, waived, surrendered
or released. Neither the Collateral Agent nor any Secured Party shall have any
obligation to protect, secure, perfect or insure any Lien at any time held by it
as security for the Borrower Obligations or for the guarantee contained in this
Section 2 or any property subject thereto.

                  SECTION 2.05. Guarantee Absolute and Unconditional. Each
Guarantor waives any and all notice of the creation, renewal, extension or
accrual of any of the Borrower Obligations and notice of or proof of reliance by
the Collateral Agent or any Secured Party upon the guarantee contained in this
Section 2 or acceptance of the guarantee contained in this Section 2; the
Borrower Obligations, and any of them, shall conclusively be deemed to have been
created, contracted or incurred, or renewed, extended, amended or waived, in
reliance upon the guarantee contained in this Section 2; and all dealings
between the Borrower and any of the Guarantors, on the one hand, and the
Collateral Agent and the Secured Parties, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon the
guarantee contained in this Section 2. Each Guarantor waives diligence,
presentment, protest, demand for payment and notice of default or nonpayment to
or upon the Borrower or any of the Guarantors with respect to the Borrower
Obligations. Each Guarantor understands and agrees that the guarantee contained
in this Section 2 shall be construed as a continuing, absolute and unconditional
guarantee of payment without regard to (a) the validity or enforceability of the
Credit Agreement, the Note Agreements, the Prudential Notes or any other Loan
Document, any of the Borrower Obligations or any collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to
time held by the Collateral Agent or any Secured Party, (b) any defense, set-off
or counterclaim (other than a defense of payment or performance in full) which
may at any time be available to or be asserted by the Borrower or any other
Person against the Collateral Agent or any Secured Party, or (c) any other
circumstance whatsoever (with or without notice to or knowledge of the Borrower
or such Guarantor) which constitutes, or might be construed to constitute, an
equitable or legal discharge of the Borrower for the Borrower Obligations, or of
such Guarantor under the guarantee contained in this Section 2, in bankruptcy or
in any other instance. When making any demand hereunder or otherwise pursuing
its rights and remedies hereunder against any Guarantor, the Collateral Agent or
any Secured Party may, but shall be under no obligation to, make a similar
demand on or otherwise pursue such rights and remedies as it may have against
the Borrower, any other Guarantor or any other Person or against any collateral
security or guarantee for the Borrower Obligations or any right of offset with
respect thereto, and any failure by the Collateral Agent or any Secured Party to
make any such demand, to pursue such other rights or remedies or to collect any
payments from the Borrower, any other Guarantor or any other Person or to
realize upon any such collateral security or guarantee or to exercise any such
right of offset, or any release of the Borrower, any other Guarantor or any
other Person or any such collateral security, guarantee or right of offset,
<PAGE>
shall not relieve any Guarantor of any obligation or liability hereunder, and
shall not impair or affect the rights and remedies, whether express, implied or
available as a matter of law, of the Collateral Agent or any Secured Party
against any Guarantor. For the purposes hereof "demand" shall include the
commencement and continuance of any legal proceedings.

                  SECTION 2.06. Remedies. Any one or more of Prudential, each
Prudential Affiliate and the Co-Administrative Agent (for the benefit of the
Lenders) (each a "Lender Party") may, either individually or collectively, seek
to enforce the Obligations of any Guarantor under and in respect of the
Guarantee. No Lender Party shall be required to (a) prosecute collection or seek
to enforce or resort to any remedies against the Borrower or any other Person
liable on any of the Obligations, (b) join the Borrower or any other Person
liable on any of the Obligations in any action in which any Lender Party
prosecutes collection or seeks to enforce or resort to any remedies against the
Borrower or other Person liable on any of the Obligations, or (c) seek to
enforce or resort to any remedies with respect to any Liens granted to (or
benefiting, directly or indirectly) any Lender Party or any other Person liable
on any of the Obligations.

                  SECTION 2.07. Reinstatement. The guarantee contained in this
Section 2 shall continue to be effective, or be reinstated, as the case may be,
if at any time payment, or any part thereof, of any of the Borrower Obligations
is rescinded or must otherwise be restored or returned by the Collateral Agent
or any Secured Party upon the insolvency, bankruptcy, dissolution, liquidation
or reorganization of the Borrower or any Guarantor, or upon or as a result of
the appointment of a receiver, intervenor or conservator of, or trustee or
similar officer for, the Borrower or any Guarantor or any substantial part of
its property, or otherwise, all as though such payments had not been made.

                  SECTION 2.08. Payments. Each Guarantor hereby guarantees that
payments hereunder (a) in respect of the Credit Agreement, the Loans and the
Reimbursement Obligations, will be paid to the Collateral Agent without set-off
or counterclaim in Dollars at the Funding Office, and (b) in respect of the Note
Agreements and the Prudential Notes, will be paid to the holders of the
Prudential Notes, without set-off or counterclaim, in the manner provided in the
Note Agreements.

              Application of Guarantee Payments and Recoveries

                  (a) Each payment or other recovery from a Guarantor under or
in respect of its obligations under this Section 2 (each, a "Guarantee Related
Payment") shall belong to each Secured Party, in accordance with their
respective "Proportionate Shares", as defined below. If any Secured Party shall
obtain any payment or other recovery (whether voluntary, involuntary, by
application of set-off or otherwise) on account of the Guarantee in excess of
its Proportionate Share of all payments then or thereafter obtained by the
Secured Parties with respect to the Guarantee, then such party shall give prompt
notice to the Collateral Agent indicating the payment or other recovery
obtained. Such Secured Party shall purchase from the other Secured Parties such
participation in the indebtedness of the Guarantors under this Agreement as
shall be necessary to cause such purchasing party to share such payment or other
recovery ratably, based on all Proportionate Shares, with all of the Secured
Parties; provided, however, that if all or any portion of such payment or other
recovery is thereafter recovered from such purchasing party, the purchase price
shall be rescinded, and each other Secured Party shall repay to the purchasing
party the purchase price, to the ratable extent of such recovery in proportion
to the amount received by such other Secured Party, together with an amount
equal to such Secured Party's ratable share (according to the proportion of (x)
the amount of such Secured Party's required repayment to the purchasing party to
(y) the total amounts recovered from the purchasing party) of any interest or
other amount paid or payable by the purchasing party in respect of the total
amount so recovered.
<PAGE>
                         The term "Proportionate Share", as used herein, shall
                           mean at any time, for each Secured Party, a fraction
                           (a) the numerator of which is the aggregate principal
                           amount of the Obligations held by such party at such
                           time, and (b) the denominator of which is the
                           aggregate principal amount of the Obligations held by
                           all Secured Parties at such time.

                     ARTICLE III GRANT OF SECURITY INTEREST

                  Each Grantor hereby assigns and transfers to the Collateral
Agent, and hereby grants to the Collateral Agent, for the ratable benefit of the
Secured Parties, a security interest in, all of the following property now owned
or at any time hereafter acquired by such Grantor or in which such Grantor now
has or at any time in the future may acquire any right, title or interest
(collectively, the "Collateral"), as collateral security for the prompt and
complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor's Obligations:

                  (a) all Accounts;

                  (b) all Chattel Paper;

                  (c) all Deposit Accounts;

                  (d) all Documents (other than title documents with respect to
vehicles);

                  (e) all Equipment;

                  (f) all General Intangibles;

                  (g) all Instruments;

                  (h) all Intellectual Property;

                  (i) all Inventory;

                  (j) all Investment Property;

                  (k) all Letter-of-Credit Rights;

                         all Commercial Tort Claims;

                  (l) all other property not otherwise described above;

                  (m) all books and records pertaining to the Collateral; and

                  (n) to the extent not otherwise included, all Proceeds,
Supporting Obligations and products of any and all of the foregoing and all
collateral security and guarantees given by any Person with respect to any of
the foregoing;

                  provided, however, that notwithstanding any of the other
provisions set forth in this Section 3, this Agreement shall not constitute a
grant of a security interest in any property to the extent that such grant of a
security interest is prohibited by any Requirements of Law of a Governmental
Authority, requires a consent not obtained of any Governmental Authority
pursuant to such Requirement of Law or is prohibited by, or constitutes a breach
or default under or results in the termination of or requires any consent not
obtained under, any contract, license,
<PAGE>
agreement, instrument or other document evidencing or giving rise to such
property or, in the case of any Investment Property, Pledged Stock or Pledged
Note, any applicable shareholder or similar agreement, except to the extent that
such Requirement of Law or the term in such contract, license, agreement,
instrument or other document or shareholder or similar agreement providing for
such prohibition, breach, default or termination or requiring such consent is
ineffective under applicable law.

                    ARTICLE IV REPRESENTATIONS AND WARRANTIES

                  To induce the Administrative Agent and the Lenders to enter
into the Credit Agreement and to make their respective extensions of credit to
the Borrower thereunder and to induce Prudential to give its consent under, and
to amend and restate, the Existing Note Agreement and to purchase the Additional
Prudential Notes under the Additional Note Agreement, each Grantor hereby
represents and warrants to the Collateral Agent and each Secured Party that:

                  SECTION 4.01. Execution, Delivery and Performance. (d) The
execution, delivery and performance by it of this Agreement have been duly
authorized by all necessary corporate action and do not and will not contravene
its bylaws or its articles of incorporation.

                  (a) The execution, delivery and performance by such Grantor of
this Agreement do not and will not contravene applicable law or, except as
permitted under the Credit Agreement and the Note Agreements, any contractual
restriction binding on or affecting such Grantor or any of its properties, and
do not and will not result in or require the creation of any Lien, security
interest or other charge of encumbrance upon or with respect to any of such
Grantor's properties except as may be created by this Agreement.

                  (b) Except with regard to Liens permitted to exist on the
Collateral by the Credit Agreement and the Note Agreements, no authorization or
approval or other action by, and no notice to or filing with, any Person or
entity not otherwise obtained is required for the due execution, delivery and
performance by such Grantor of this Agreement.

                  (c) This Agreement is a legal, valid and binding obligation of
such Grantor, enforceable against such Grantor, in accordance with its terms.

                  (d) There is no action, suit or proceeding pending or, to the
knowledge of such Grantor, threatened against or otherwise affecting it before
any Governmental Authority or arbitrator which would prohibit the execution,
delivery and performance by it of this Agreement.

                  (e) Such Grantor (other than the Borrower) and the Borrower
are separately incorporated or organized entities that operate independently
from each other. Such Grantor (other than the Borrower) utilizes certain
accounting, cash management, management and other operational and organizational
functions of the Borrower for operational and organizational efficiency, as well
as to assist in the preparation of tax returns on a consolidated basis. In the
event these functions were no longer provided to such Grantor by the Borrower,
such Grantor would need to make the necessary adjustments in its operations and
organizational functions, in order to replace such functions. The majority of
the purchasing functions of such Grantor are handled by the Borrower, although
some of these functions may be occasionally shared for efficiency or as special
circumstances warrant.

                  SECTION 4.02. Title; No Other Liens Except for the security
interest granted to the Collateral Agent for the ratable benefit of the Secured
Parties pursuant to this Agreement and the other Liens permitted to exist on the
Collateral by the Credit Agreement and the Note Agreements, such Grantor owns
each item of the Collateral free and clear of any and all Liens or claims of
others. Except (i) with regard to Liens permitted to exist on the Collateral by
the Credit Agreement and the Note
<PAGE>
Agreements, and (ii) for financing statements evidencing operating lease
transactions, no financing statement or other public notice with respect to all
or any part of the Collateral is on file or of record in any public office,
except such as have been filed in favor of the Collateral Agent, for the ratable
benefit of the Secured Parties, pursuant to this Agreement or as are permitted
by the Credit Agreement and the Note Agreements. For the avoidance of doubt, it
is understood and agreed that any Grantor may, as part of its business, grant
licenses to third parties to use Intellectual Property owned or developed by a
Grantor. For purposes of this Agreement and the other Loan Documents, such
licensing activity shall not constitute a "Lien" on such Intellectual Property.
Each of the Collateral Agent and each Secured Party understands that any such
licenses may be exclusive to the applicable licensees, and such exclusivity
provisions may limit the ability of the Collateral Agent to utilize, sell, lease
or transfer the related Intellectual Property or otherwise realize value from
such Intellectual Property pursuant hereto.

                  SECTION 4.03. Perfected Priority Liens. The security interests
granted pursuant to this Agreement (a) to the extent they can be perfected under
the UCC, constitute valid perfected security interests in all of the Collateral
in favor of the Collateral Agent, for the ratable benefit of the Secured
Parties, as collateral security for such Grantor's Obligations, enforceable in
accordance with the terms hereof and (b) are prior to all other Liens on the
Collateral in existence on the date hereof except for Liens permitted by the
Credit Agreement and the Note Agreements and unrecorded Liens which have
priority over the Liens on the Collateral by operation of law.

                  SECTION 4.04. Jurisdiction of Organization; Chief Executive
Office. On the date hereof, such Grantor's jurisdiction of organization,
identification number from the jurisdiction of organization (if any), and the
location of such Grantor's chief executive office or sole place of business or
principal residence, as the case may be, are specified on Schedule 3. Such
Grantor has furnished to the Collateral Agent a certified charter, certificate
of incorporation or other organization document and long-form good standing
certificate as of a date which is recent to the date hereof.

                  SECTION 4.05. Farm Products. None of the Collateral
constitutes, or is the Proceeds of, Farm Products.

                  SECTION 4.06. Investment Property. (e) The shares of Pledged
Stock pledged by such Grantor hereunder constitute all the issued and
outstanding shares of all classes of the Capital Stock of each Issuer owned by
such Grantor or, in the case of Foreign Subsidiary Voting Stock, if less, 66% of
the outstanding Foreign Subsidiary Voting Stock of each relevant Issuer.

                  (a) All the shares of the Pledged Stock have been duly and
validly issued and are fully paid and nonassessable.

                  (b) To the knowledge of the Grantors, each of the Pledged
Notes constitutes the legal, valid and binding obligation of the obligor with
respect thereto, enforceable in accordance with its terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.

                  (c) Such Grantor is the record and beneficial owner of, and
has good and marketable title to, the Investment Property pledged by it
hereunder, free of any and all Liens or
<PAGE>
options in favor of, or claims of, any other Person, except the security
interest created by this Agreement.

                  SECTION 4.07. Receivables(a) . The amounts represented by such
Grantor to the Secured Parties from time to time as owing to such Grantor in
respect of the Receivables will at such times be accurate.

                  SECTION 4.08. Intellectual Property. Schedule 4 lists all
Intellectual Property owned by such Grantor in its own name on the date hereof,
other than Trademarks or Copyrights arising under common law or state law, as to
which no registration or other filing has been made.

                               ARTICLE V COVENANTS

                  Each Grantor covenants and agrees with the Collateral Agent
and the Secured Parties that, from and after the date of this Agreement until
the Obligations shall have been paid in full, no Letter of Credit shall be
outstanding and the Commitments shall have terminated:

                  SECTION 5.01. Delivery of Instruments, Certificated Securities
and Chattel Paper. If an Event of Default shall occur and be continuing and if
any amount payable under or in connection with any of the Collateral shall be or
become evidenced by any Instrument, Certificated Security or Chattel Paper, such
Instrument, Certificated Security or Chattel Paper shall be immediately
delivered to the Collateral Agent, duly indorsed in a manner satisfactory to the
Collateral Agent, to be held as Collateral pursuant to this Agreement.

                  SECTION 5.02. 1.2 Maintenance of Insurance. Such Grantor will
have and maintain insurance at its expense at all times and in such amounts, in
such form, containing such terms and written by such companies as may be
reasonably satisfactory to the Collateral Agent (and as more particularly set
forth in the Credit Agreement and the Note Agreements). All policies of
insurance shall be payable to the Collateral Agent and such Grantor, as its
interests may appear, shall name the Collateral Agent as a co-insured party, and
shall provide for thirty (30) days' written notice of cancellation or
modification to the Collateral Agent. So long as any Event of Default exists,
the Collateral Agent is authorized by such Grantor to act as its attorney in
collecting, adjusting, settling or canceling such insurance and endorsing any
drafts drawn by insurers. The Collateral Agent may apply any proceeds of
insurance received by it to the Obligations, whether due or not; provided,
however, that the Collateral Agent will hold such proceeds as a special deposit
for use by such Grantor to repair, restore or replace the assets which gave rise
to such proceeds, or to acquire other tangible assets to be used in such
Grantor's businesses, within one year after the event giving rise to such
proceeds, so long as (i) such Grantor is taking steps to repair, restore or
replace such Collateral, or to acquire such tangible assets, with due diligence
and in good faith and (ii) no Event of Default shall have occurred. Such Grantor
will immediately notify the Collateral Agent of any damage to or loss of
Collateral in excess of $5,000,000. Not later than ten (10) days prior to the
expiration date of each policy of insurance then in effect, such Grantor shall
deliver to the Collateral Agent a certificate of insurance certifying as to (i)
the extension of such policy or the issuance of a renewal policy therefor,
describing the same in reasonable detail satisfactory to the Collateral Agent
and (ii) the payment in full of the portion of the premium therefor then due and
payable (or accompanied by other proof of such payment satisfactory to the
Collateral Agent). Such Grantor shall be required forthwith to notify the
Collateral Agent (by telephone, confirmed in writing) if such Grantor shall
determine at any time not to, or at any time be unable to, extend or renew any
such policy then in effect. Notwithstanding the foregoing, such Grantor,
pursuant to Article Nine of the New York UCC, shall bear the risk of loss of
Collateral.
<PAGE>
                  SECTION 5.03. 1.3 Payment of Obligations. Such Grantor will
pay and discharge or otherwise satisfy at or before maturity or before they
become delinquent, as the case may be, all taxes, assessments and governmental
charges or levies imposed upon the Collateral or in respect of income or profits
therefrom, as well as all claims of any kind (including, without limitation,
claims for labor, materials and supplies) against or with respect to the
Collateral, except that no such charge need be paid if the amount or validity
thereof is currently being contested in good faith by appropriate proceedings,
reserves in conformity with GAAP with respect thereto have been provided on the
books of such Grantor and such proceedings could not reasonably be expected to
result in the sale, forfeiture or loss of any material portion of the Collateral
or any interest therein.

                  SECTION 5.04. Maintenance of Perfected Security Interest;
Further Documentation. (a) Such Grantor shall defend the security interest
created by this Agreement against the claims and demands of all Persons
whomsoever, subject to the rights of such Grantor under the Loan Documents to
dispose of the Collateral.

                  (a) Such Grantor will furnish to the Collateral Agent and the
Secured Parties from time to time statements and schedules further identifying
and describing the assets and property of such Grantor and such other reports in
connection therewith as the Collateral Agent or any Secured Party may reasonably
request, all in reasonable detail.

                  (b) At any time and from time to time, upon the written
request of the Collateral Agent, and at the sole expense of such Grantor, such
Grantor will promptly and duly execute and deliver, and have recorded, such
further instruments and documents and take such further actions as the
Collateral Agent may reasonably request for the purpose of obtaining or
preserving the full benefits of this Agreement and of the rights and powers
herein granted, including, without limitation, (i) filing any financing or
continuation statements under the Uniform Commercial Code (or other similar
laws) in effect in any jurisdiction with respect to the security interests
created hereby and (ii) in the case of Investment Property, Deposit Accounts,
Letter-of-Credit Rights and any other relevant Collateral, taking any actions
necessary to enable the Collateral Agent to obtain "control" (within the meaning
of the applicable Uniform Commercial Code) with respect thereto.

                  SECTION 5.05. Changes in Locations, Name, etc. Such Grantor
will not, except upon 30 days' prior written notice to the Collateral Agent and
delivery to the Collateral Agent of all additional executed financing statements
and other documents reasonably requested by the Collateral Agent to maintain the
validity, perfection and priority of the security interests provided for herein:

                  (a) change its jurisdiction of organization or the location of
         its chief executive office or sole place of business or principal
         residence from that referred to in Section 4.4; or

                  (b) change its name.

                  SECTION 5.06. 1.4 Notices. Such Grantor will advise the
Collateral Agent and the Secured Parties promptly, in reasonable detail, of:

                  (a) any Lien (other than security interests created hereby or
Liens permitted under the Credit Agreement and the Note Agreements) on any of
the Collateral which would adversely affect the ability of the Collateral Agent
to exercise any of its remedies hereunder; and
<PAGE>
                  (b) the occurrence of any other event which could reasonably
be expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.

                  SECTION 5.07. Investment Property. (a) If such Grantor shall
become entitled to receive or shall receive any certificate (including, without
limitation, any certificate representing a dividend or a distribution in
connection with any reclassification, increase or reduction of capital or any
certificate issued in connection with any reorganization), option or rights in
respect of the Capital Stock of any Issuer, whether in addition to, in
substitution of, as a conversion of, or in exchange for, any shares of the
Pledged Stock, or otherwise in respect thereof, such Grantor shall accept the
same as the agent of the Collateral Agent and the Secured Parties, hold the same
in trust for the Collateral Agent and the Secured Parties and deliver the same
forthwith to the Collateral Agent in the exact form received, duly indorsed by
such Grantor to the Collateral Agent, if required, together with an undated
stock power covering such certificate duly executed in blank by such Grantor and
with, if the Collateral Agent so requests, signature guaranteed, to be held by
the Collateral Agent, subject to the terms hereof, as additional collateral
security for the Obligations. Any sums paid upon or in respect of the Investment
Property upon the liquidation or dissolution of any Issuer shall be paid over to
the Collateral Agent to be held by it hereunder as additional collateral
security for the Obligations, and in case any distribution representing a return
of capital shall be made on or in respect of the Investment Property or any
property shall be distributed upon or with respect to the Investment Property
pursuant to the recapitalization or reclassification of the capital of any
Issuer or pursuant to the reorganization thereof, the property so distributed
shall, unless otherwise subject to a perfected security interest in favor of the
Collateral Agent, be delivered to the Collateral Agent to be held by it
hereunder as additional collateral security for the Obligations. If any sums of
money or property so paid or distributed in respect of the Investment Property
shall be received by such Grantor, such Grantor shall, until such money or
property is paid or delivered to the Collateral Agent, hold such money or
property in trust for the Collateral Agent and the Secured Parties, segregated
from other funds of such Grantor, as additional collateral security for the
Obligations.

                  (a) Without the prior written consent of the Collateral Agent,
or unless otherwise permitted by the Loan Documents, such Grantor will not (i)
vote to enable, or take any other action to permit, any Issuer to issue any
Capital Stock of any nature or to issue any other securities convertible into or
granting the right to purchase or exchange for any Capital Stock of any nature
of any Issuer, (ii) sell, assign, transfer, exchange, or otherwise dispose of,
or grant any option with respect to, the Investment Property or Proceeds
thereof, (iii) create, incur or permit to exist any Lien or option in favor of,
or any claim of any Person with respect to, any of the Investment Property or
Proceeds thereof, or any interest therein, except for the security interests
created by this Agreement or (iv) enter into any agreement or undertaking
restricting the right or ability of such Grantor or the Collateral Agent to
sell, assign or transfer any of the Investment Property or Proceeds thereof.

                  (b) In the case of each Grantor which is an Issuer, such
Issuer agrees that (i) it will be bound by the terms of this Agreement relating
to the Investment Property issued by it and will comply with such terms insofar
as such terms are applicable to it, and (ii) it will notify the Collateral Agent
promptly in writing of the occurrence of any of the events described in Section
5.7(a) with respect to the Investment Property issued by it.

                  SECTION 5.08. Intellectual Property. Such Grantor will take
all reasonable and necessary steps, including, without limitation, in any
proceeding before the United States Patent and Trademark Office, the United
States Copyright Office or any similar office or agency in any other country or
any political subdivision thereof, to maintain and pursue each application (and
<PAGE>
to obtain the relevant registration) and to maintain each registration of the
material Intellectual Property, including, without limitation, filing of
applications for renewal, affidavits of use and affidavits of incontestability.

                         ARTICLE VI REMEDIAL PROVISIONS

                  SECTION 6.01. Certain Matters Relating to Receivables. (b) At
any time after the occurrence and during the continuance of an Event of Default,
the Collateral Agent shall have the right to make test verifications of the
Receivables in any manner and through any medium that it reasonably considers
advisable, and each Grantor shall furnish all such assistance and information as
the Collateral Agent may require in connection with such test verifications. At
any time and from time to time, upon the Collateral Agent's request and at the
expense of the relevant Grantor, such Grantor shall cause independent public
accountants or others satisfactory to the Collateral Agent to furnish to the
Collateral Agent reports showing reconciliations, aging and test verifications
of, and trial balances for, the Receivables.

                  (a) The Collateral Agent hereby authorizes each Grantor to
collect such Grantor's Receivables, and the Collateral Agent may curtail or
terminate said authority at any time after the occurrence and during the
continuance of an Event of Default. If required by the Collateral Agent at any
time after the occurrence and during the continuance of an Event of Default, any
payments of Receivables, when collected by any Grantor, (i) shall be forthwith
(and, in any event, within two Business Days) deposited by such Grantor in the
exact form received, duly indorsed by such Grantor to the Collateral Agent if
required, in a Collateral Account maintained under the sole dominion and control
of the Collateral Agent, subject to withdrawal by the Collateral Agent for the
account of the Secured Parties only as provided in Section 6.5, and (ii) until
so turned over, shall be held by such Grantor in trust for the Collateral Agent
and the Secured Parties, segregated from other funds of such Grantor. Each such
deposit of Proceeds of Receivables shall be accompanied by a report identifying
in reasonable detail the nature and source of the payments included in the
deposit.

                  (b) At the Collateral Agent's request at any time after the
occurrence and during the continuance of an Event of Default, each Grantor shall
deliver to the Collateral Agent all original and other documents evidencing, and
relating to, the agreements and transactions which gave rise to the Receivables,
including, without limitation, all original orders, invoices and shipping
receipts.

                  SECTION 6.02. Communications with Obligors; Grantors Remain
Liable. (c) The Collateral Agent in its own name or in the name of others may at
any time after the occurrence and during the continuance of an Event of Default
communicate with obligors under the Receivables to verify with them to the
Collateral Agent's satisfaction the existence, amount and terms of any
Receivables.

                  (a) Upon the request of the Collateral Agent at any time after
the occurrence and during the continuance of an Event of Default, each Grantor
shall notify obligors on the Receivables that the Receivables have been assigned
to the Collateral Agent for the ratable benefit of the Secured Parties and that
payments in respect thereof shall be made directly to the Collateral Agent.

                  (b) Anything herein to the contrary notwithstanding, each
Grantor shall remain liable under the Receivables to observe and perform all the
conditions and obligations to be observed and performed by it thereunder, all in
accordance with the terms of any agreement giving rise thereto. Neither the
Collateral Agent nor any Secured Party shall have any obligation or liability
under any Receivable (or any agreement giving rise thereto) by reason of or
arising
<PAGE>
out of this Agreement or the receipt by the Collateral Agent or any Secured
Party of any payment relating thereto, nor shall the Collateral Agent or any
Secured Party be obligated in any manner to perform any of the obligations of
any Grantor under or pursuant to any Receivable (or any agreement giving rise
thereto) to make any payment, to make any inquiry as to the nature or the
sufficiency of any payment received by it or as to the sufficiency of any
performance by any party thereunder, to present or file any claim, to take any
action to enforce any performance or to collect the payment of any amounts which
may have been assigned to it or to which it may be entitled at any time or
times.

                  SECTION 6.03. Pledged Stock. (d) Unless an Event of Default
shall have occurred and be continuing and the Collateral Agent shall have given
notice to the relevant Grantor of the Collateral Agent's intent to exercise its
corresponding rights pursuant to Section 6.3(b), each Grantor shall be permitted
to receive all cash dividends paid in respect of the Pledged Stock and all
payments made in respect of the Pledged Notes, in each case paid in the normal
course of business of the relevant Issuer and consistent with past practice, to
the extent permitted in the Credit Agreement and the Note Agreements, and to
exercise all voting and corporate or other organizational rights with respect to
the Investment Property.

                  (a) If an Event of Default shall occur and be continuing and
the Collateral Agent shall give notice of its intent to exercise such rights to
the relevant Grantor or Grantors, the Collateral Agent shall have the right to
receive any and all cash dividends, payments or other Proceeds paid in respect
of the Investment Property and make application thereof to the Obligations, as
provided in the Intercreditor Agreement, in such order as the Collateral Agent
may determine. If an Event of Default shall occur and be continuing and either
(A) the Co-Administrative Agent shall have, pursuant to the request of the
Required Lenders, by notice to the Borrower (i) terminated the Revolving Credit
Commitments and/or (ii) declared the Loans then outstanding to be due and
payable in whole, or (B) any or all of the Prudential Notes shall have become
immediately due and payable pursuant to Section 7.1 of the respective Note
Agreement, then any or all of the Investment Property shall at the request of
the Collateral Agent be registered in the name of the Collateral Agent or its
nominee, and the Collateral Agent or its nominee may thereafter exercise (x) all
voting, corporate and other rights pertaining to such Investment Property at any
meeting of shareholders of the relevant Issuer or Issuers or otherwise and (y)
any and all rights of conversion, exchange and subscription and any other
rights, privileges or options pertaining to such Investment Property as if it
were the absolute owner thereof (including, without limitation, the right to
exchange at its discretion any and all of the Investment Property upon the
merger, consolidation, reorganization, recapitalization or other fundamental
change in the corporate or other organizational structure of any Issuer, or upon
the exercise by any Grantor or the Collateral Agent of any right, privilege or
option pertaining to such Investment Property, and in connection therewith, the
right to deposit and deliver any and all of the Investment Property with any
committee, depositary, transfer agent, registrar or other designated agency upon
such terms and conditions as the Collateral Agent may determine), all without
liability except to account for property actually received by it, but the
Collateral Agent shall have no duty to any Grantor to exercise any such right,
privilege or option and shall not be responsible for any failure to do so or
delay in so doing.

                  (b) Each Grantor hereby authorizes and instructs each Issuer
of any Investment Property pledged by such Grantor hereunder to (i) comply with
any instruction received by it from the Collateral Agent in writing that (x)
states that an Event of Default has occurred and is continuing and (y) is
otherwise in accordance with the terms of this Agreement, without any other or
further instructions from such Grantor, and each Grantor agrees that each Issuer
shall be fully protected in so complying, and (ii) unless otherwise expressly
permitted hereby, pay any dividends or other payments with respect to the
Investment Property directly to the Collateral
<PAGE>
Agent. Each Issuer which is a party hereto acknowledges the authorizations and
instructions provided for in the immediately proceeding sentence.

                  SECTION 6.04. Proceeds to be Turned Over To Collateral Agent.
In addition to the rights of the Collateral Agent and the Secured Parties
specified in Section 6.1 with respect to payments of Receivables, if an Event of
Default shall occur and be continuing, all Proceeds received by any Grantor
consisting of cash, checks and other near-cash items shall be held by such
Grantor in trust for the Collateral Agent and the Secured Parties, segregated
from other funds of such Grantor, and shall, forthwith upon receipt by such
Grantor, be turned over to the Collateral Agent in the exact form received by
such Grantor (duly indorsed by such Grantor to the Collateral Agent, if
required). All Proceeds received by the Collateral Agent hereunder shall be held
by the Collateral Agent in a Collateral Account maintained under its sole
dominion and control. All Proceeds while held by the Collateral Agent in a
Collateral Account (or by such Grantor in trust for the Collateral Agent and the
Lenders) shall continue to be held as collateral security for all the
Obligations and shall not constitute payment thereof until applied as provided
in Section 6.5.

                  SECTION 6.05. Application of Proceeds. The Collateral Agent
shall apply any Proceeds constituting Collateral (other than any Guarantee
Related Payment, which payments shall be applied in accordance with Section 2.9
hereof) received by the Collateral Agent pursuant to or in connection with
enforcement of this Agreement or upon the commencement of and during the
continuance of any proceedings by or against any Grantor of any type referred to
in Article VII(h) of the Credit Agreement or Section 7.1(k) of the Note
Agreements as provided in the Intercreditor Agreement (notwithstanding any other
provision herein to the contrary). Any balance of such Proceeds remaining after
the Obligations shall have been paid in full shall be paid over to the Borrower
or to whomsoever may be lawfully entitled to receive the same.

                  SECTION 6.06. Code and Other Remedies. If an Event of Default
shall occur and be continuing, the Collateral Agent, on behalf of the Secured
Parties, may exercise, in addition to all other rights and remedies granted to
them in this Agreement and in any other instrument or agreement securing,
evidencing or relating to the Obligations, all rights and remedies of a secured
party under the New York UCC or any other applicable law. Without limiting the
generality of the foregoing, the Collateral Agent, without demand of performance
or other demand, presentment, protest, advertisement or notice of any kind
(except any notice required by law referred to below or required by any Loan
Document) to or upon any Grantor or any other Person (all and each of which
demands, defenses, advertisements and notices are hereby waived), may in such
circumstances forthwith collect, receive, appropriate and realize upon the
Collateral, or any part thereof, and/or may forthwith sell, lease, assign, give
option or options to purchase, or otherwise dispose of and deliver the
Collateral or any part thereof (or contract to do any of the foregoing), in one
or more parcels at public or private sale or sales, at any exchange, broker's
board or office of the Collateral Agent or any Secured Party or elsewhere upon
such terms and conditions as it may deem advisable and at such prices as it may
deem best, for cash or on credit or for future delivery without assumption of
any credit risk. The Collateral Agent or any Secured Party shall have the right
upon any such public sale or sales, and, to the extent permitted by law, upon
any such private sale or sales, to purchase the whole or any part of the
Collateral so sold, free of any right or equity of redemption in any Grantor,
which right or equity is hereby waived and released. Each Grantor further
agrees, at the Collateral Agent's request, to assemble the Collateral and make
it available to the Collateral Agent at places which the Collateral Agent shall
reasonably select, whether at such Grantor's premises or elsewhere. The
Collateral Agent shall apply the net proceeds of any action taken by it pursuant
to this Section 6.6, after deducting all reasonable costs and expenses of every
kind incurred in connection therewith or incidental to the care or safekeeping
of any of the Collateral or in any
<PAGE>
way relating to the Collateral or the rights of the Collateral Agent and the
Secured Parties hereunder, including, without limitation, reasonable attorneys'
fees and disbursements, to the payment in whole or in part of the Obligations,
in such order as the Collateral Agent may elect, and only after such application
and after the payment by the Collateral Agent of any other amount required by
any provision of law, including, without limitation, Section 9-615(a)(3) of the
New York UCC, need the Collateral Agent account for the surplus, if any, to any
Grantor. To the extent permitted by applicable law, each Grantor waives all
claims, damages and demands it may acquire against the Collateral Agent or any
Secured Party arising out of the exercise by them of any rights hereunder. If
any notice of a proposed sale or other disposition of Collateral shall be
required by law, such notice shall be deemed reasonable and proper if given at
least 10 days before such sale or other disposition.

                  SECTION 6.07. Sale of Pledged Stock. Each Grantor recognizes
that the Collateral Agent may be unable to effect a public sale of any or all
the Pledged Stock, by reason of certain prohibitions contained in the Securities
Act and applicable state securities laws or otherwise, and may be compelled to
resort to one or more private sales thereof to a restricted group of purchasers
which will be obliged to agree, among other things, to acquire such securities
for their own account for investment and not with a view to the distribution or
resale thereof. Each Grantor acknowledges and agrees that any such private sale
may result in prices and other terms less favorable than if such sale were a
public sale and, notwithstanding such circumstances, agrees that any such
private sale shall be deemed to have been made in a commercially reasonable
manner. The Collateral Agent shall be under no obligation to delay a sale of any
of the Pledged Stock for the period of time necessary to permit the Issuer
thereof to register such securities for public sale under the Securities Act, or
under applicable state securities laws.

                  SECTION 6.08. Deficiency. Each Grantor shall remain liable for
any deficiency if the proceeds of any sale or other disposition of the
Collateral are insufficient to pay its Obligations and the fees and
disbursements of any attorneys employed by the Collateral Agent or any Secured
Party to collect such deficiency.

                        ARTICLE VII THE COLLATERAL AGENT

                  SECTION 7.01. Collateral Agent's Appointment as
Attorney-in-Fact, etc. (e) Each Grantor hereby irrevocably constitutes and
appoints the Collateral Agent and any officer or agent thereof, with full power
of substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of such Grantor and in the name of
such Grantor or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, and, without limiting the generality of the
foregoing, each Grantor hereby gives the Collateral Agent the power and right,
on behalf of such Grantor, without notice to or assent by such Grantor, to do
any or all of the following:

                  (a) in the name of such Grantor or its own name, or otherwise,
         take possession of and indorse and collect any checks, drafts, notes,
         acceptances or other instruments for the payment of moneys due under
         any Receivable or with respect to any other Collateral and file any
         claim or take any other action or proceeding in any court of law or
         equity or otherwise deemed appropriate by the Collateral Agent for the
         purpose of collecting any and all such moneys due under any Receivable
         or with respect to any other Collateral whenever payable;
<PAGE>
                  (b) in the case of any Intellectual Property, execute and
         deliver, and have recorded, any and all agreements, instruments,
         documents and papers as the Collateral Agent may request to evidence
         the Collateral Agent's and the Secured Parties' security interest in
         such Intellectual Property and the goodwill and general intangibles of
         such Grantor relating thereto or represented thereby;

                  (c) pay or discharge taxes and Liens levied or placed on or
         threatened against the Collateral, effect any repairs or any insurance
         called for by the terms of this Agreement and pay all or any part of
         the premiums therefor and the costs thereof;

                  (d) execute, in connection with any sale provided for in
         Section 6.6 or 6.7, any indorsements, assignments or other instruments
         of conveyance or transfer with respect to the Collateral; and

                  (e) (1) direct any party liable for any payment under any of
         the Collateral to make payment of any and all moneys due or to become
         due thereunder directly to the Collateral Agent or as the Collateral
         Agent shall direct; (2) ask or demand for, collect, and receive payment
         of and receipt for, any and all moneys, claims and other amounts due or
         to become due at any time in respect of or arising out of any
         Collateral; (3) sign and indorse any invoices, freight or express
         bills, bills of lading, storage or warehouse receipts, drafts against
         debtors, assignments, verifications, notices and other documents in
         connection with any of the Collateral; (4) commence and prosecute any
         suits, actions or proceedings at law or in equity in any court of
         competent jurisdiction to collect the Collateral or any portion thereof
         and to enforce any other right in respect of any Collateral; (5) defend
         any suit, action or proceeding brought against such Grantor with
         respect to any Collateral; (6) settle, compromise or adjust any such
         suit, action or proceeding and, in connection therewith, give such
         discharges or releases as the Collateral Agent may deem appropriate;
         (7) assign any Copyright, Patent or Trademark (along with the goodwill
         of the business to which any such Copyright, Patent or Trademark
         pertains), throughout the world for such term or terms, on such
         conditions, and in such manner, as the Collateral Agent shall in its
         sole discretion determine; and (8) generally, sell, transfer, pledge
         and make any agreement with respect to or otherwise deal with any of
         the Collateral as fully and completely as though the Collateral Agent
         were the absolute owner thereof for all purposes, and do, at the
         Collateral Agent's option and such Grantor's expense, at any time, or
         from time to time, all acts and things which the Collateral Agent deems
         necessary to protect, preserve or realize upon the Collateral and the
         Collateral Agent's and the Secured Parties' security interests therein
         and to effect the intent of this Agreement, all as fully and
         effectively as such Grantor might do.

     Anything in this Section 7.1(a) to the contrary notwithstanding, the
Collateral Agent agrees that it will not exercise any rights under the power of
attorney provided for in this Section 7.1(a) unless an Event of Default shall
have occurred and be continuing.

                  (b) If any Grantor fails to perform or comply with any of its
agreements contained herein, the Collateral Agent, at its option, but without
any obligation so to do, may perform or comply, or otherwise cause performance
or compliance, with such agreement.

                  (c) The expenses of the Collateral Agent incurred in
connection with actions undertaken as provided in this Section 7.1, together
with interest thereon at a rate per annum equal to the highest rate per annum at
which interest would then be payable on any category of past due ABR Loans under
the Credit Agreement, from the date of payment by the Collateral Agent to the
date reimbursed by the relevant Grantor, shall be payable by such Grantor to the
Collateral Agent on demand.
<PAGE>
                  (d) Each Grantor hereby ratifies all that said attorneys shall
lawfully do or cause to be done by virtue hereof. All powers, authorizations and
agencies contained in this Agreement are coupled with an interest and are
irrevocable until this Agreement is terminated and the security interests
created hereby are released.

                  SECTION 7.02. Duty of Collateral Agent. The Collateral Agent's
sole duty with respect to the custody, safekeeping and physical preservation of
the Collateral in its possession, under Section 9-207 of the New York UCC or
otherwise, shall be to deal with it in the same manner as the Collateral Agent
deals with similar property for its own account. Neither the Collateral Agent,
any Secured Party nor any of their respective officers, directors, employees or
agents shall be liable for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise dispose of any Collateral upon the request of any Grantor or any
other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof. The powers conferred on the Collateral Agent and
the Secured Parties hereunder are solely to protect the Collateral Agent's and
the Secured Parties' interests in the Collateral and shall not impose any duty
upon the Collateral Agent or any Secured Party to exercise any such powers. The
Collateral Agent and the Secured Parties shall be accountable only for amounts
that they actually receive as a result of the exercise of such powers, and
neither they nor any of their officers, directors, employees or agents shall be
responsible to any Grantor for any act or failure to act hereunder, except for
their own gross negligence or willful misconduct.

                  SECTION 7.03. Execution of Financing Statements. Pursuant to
any applicable law, each Grantor authorizes the Collateral Agent to file or
record financing statements and other filing or recording documents or
instruments with respect to the Collateral without the signature of such Grantor
in such form and in such offices as the Collateral Agent determines appropriate
to perfect the security interests of the Collateral Agent under this Agreement.
Each Grantor authorizes the Collateral Agent to use the collateral description
"all personal property" in any such financing statements. Each Grantor hereby
ratifies and authorizes the filing by the Collateral Agent of any financing
statement with respect to the Collateral made prior to the date hereof.

                  SECTION 7.04. Authority of Collateral Agent. Each Grantor
acknowledges that the rights and responsibilities of the Collateral Agent under
this Agreement with respect to any action taken by the Collateral Agent or the
exercise or non-exercise by the Collateral Agent of any option, voting right,
request, judgment or other right or remedy provided for herein or resulting or
arising out of this Agreement shall, as between the Collateral Agent and the
Secured Parties, be governed by the Intercreditor Agreement and the Credit
Agreement and by such other agreements with respect thereto as may exist from
time to time among them, but, as between the Collateral Agent and the Grantors,
the Collateral Agent shall be conclusively presumed to be acting as agent for
the Secured Parties with full and valid authority so to act or refrain from
acting, and no Grantor shall be under any obligation, or entitlement, to make
any inquiry respecting such authority.

                           ARTICLE VIII MISCELLANEOUS

                  SECTION 8.01. Amendments in Writing. None of the terms or
provisions of this Agreement may be waived, amended, supplemented or otherwise
modified except (a) with the consent of the Required Noteholders and (b) in
accordance with Section 9.02(b) of the Credit Agreement.

                  SECTION 8.02. Notices. All notices, requests and demands to or
upon the Collateral Agent or any Grantor hereunder shall be effected in the
manner provided for in
<PAGE>
Section 9.01 of the Credit Agreement, and, in the case of any Grantor, the Note
Agreements; provided that any such notice, request or demand to or upon any
Guarantor shall be addressed to such Guarantor at its notice address set forth
on Schedule 1.

                  SECTION 8.03. No Waiver by Course of Conduct; Cumulative
Remedies. Neither the Collateral Agent nor any Secured Party shall by any act
(except by a written instrument pursuant to Section 8.1), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default. No failure to exercise,
nor any delay in exercising, on the part of the Collateral Agent or any Secured
Party, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Collateral Agent or any
Secured Party of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Collateral Agent or such
Secured Party would otherwise have on any future occasion. The rights and
remedies herein provided are cumulative, may be exercised singly or concurrently
and are not exclusive of any other rights or remedies provided by law.

                  SECTION 8.04. Enforcement Expenses; Indemnification. (f) Each
Guarantor agrees to pay or reimburse each Secured Party and the Collateral Agent
for all its costs and expenses incurred in collecting against such Guarantor
under the guarantee contained in Section 2 or otherwise enforcing or preserving
any rights under this Agreement, the Note Agreements and the other Loan
Documents to which such Guarantor is a party, including, without limitation, the
fees and disbursements of counsel (including the allocated fees and expenses of
in-house counsel) to each Secured Party and of counsel to the Collateral Agent.

                  (a) Each Guarantor agrees to pay, and to save the Collateral
Agent and the Secured Parties harmless from, any and all liabilities with
respect to, or resulting from any delay in paying, any and all stamp, excise,
sales or other taxes which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions
contemplated by this Agreement.

                  (b) Each Guarantor agrees to pay, and to save the Collateral
Agent and the Secured Parties harmless from, any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement to the extent the Borrower would be required to do so pursuant to
Section 9.03 of the Credit Agreement or pursuant to Section 11.2 of the Note
Agreements.

                  (c) The agreements in this Section 8.4 shall survive repayment
of the Obligations and all other amounts payable under the Credit Agreement, the
Note Agreements, the Prudential Notes and the other Loan Documents.

                  SECTION 8.05. Successors and Assigns. This Agreement shall be
binding upon the successors and assigns of each Grantor and shall inure to the
benefit of the Collateral Agent and the Secured Parties and their successors and
assigns; provided that no Grantor may assign, transfer or delegate any of its
rights or obligations under this Agreement without the prior written consent of
the Collateral Agent.

                  SECTION 8.06. Set-Off. Each Grantor hereby irrevocably
authorizes the Collateral Agent and each Secured Party at any time and from time
to time while an Event of Default shall have occurred and be continuing, without
notice to such Grantor or any other Grantor, any such notice being expressly
waived by each Grantor, to set-off and appropriate and
<PAGE>
apply any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by the Collateral Agent or such
Secured Party to or for the credit or the account of such Grantor, or any part
thereof in such amounts as the Collateral Agent or such Secured Party may elect,
against and on account of the obligations and liabilities of such Grantor to the
Collateral Agent or such Secured Party hereunder and claims of every nature and
description of the Collateral Agent or such Secured Party against such Grantor,
in any currency, whether arising hereunder, under the Credit Agreement, the Note
Agreements, the Prudential Notes, any other Loan Document or otherwise, as the
Collateral Agent or such Secured Party may elect, whether or not the Collateral
Agent or any Secured Party has made any demand for payment and although such
obligations, liabilities and claims may be contingent or unmatured. The
Collateral Agent and each Secured Party shall notify such Grantor promptly of
any such set-off and the application made by the Collateral Agent or such
Secured Party of the proceeds thereof, provided that the failure to give such
notice shall not affect the validity of such set-off and application. The rights
of the Collateral Agent and each Secured Party under this Section 8.6 are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) which the Collateral Agent or such Secured Party may have.

                  SECTION 8.07. Counterparts. This Agreement may be executed by
one or more of the parties to this Agreement on any number of separate
counterparts (including by telecopy), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.

                  SECTION 8.08. Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

                  SECTION 8.09. Section Headings. The Section headings used in
this Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.

                  SECTION 8.10. Integration. This Agreement, the Credit
Agreement, the Note Agreements, the Prudential Notes, the Intercreditor
Agreement and the other Loan Documents represent the agreement of the Grantors,
the Collateral Agent and the Secured Parties with respect to the subject matter
hereof and thereof, and there are no promises, undertakings, representations or
warranties by the Collateral Agent or any Secured Party relative to subject
matter hereof and thereof not expressly set forth or referred to herein, in the
Credit Agreement, in the Note Agreements, in the Prudential Notes, in the
Intercreditor Agreement or in the other Loan Documents.

SECTION 8.11. 1.5 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

                  SECTION 8.12. Submission To Jurisdiction; Waivers. Each
Grantor hereby irrevocably and unconditionally:

                  (a) submits for itself and its property in any legal action or
proceeding relating to this Agreement, the Credit Agreement, the Note
Agreements, the Prudential Notes and the other Loan Documents to which it is a
party, or for recognition and enforcement of any judgment in
<PAGE>
respect thereof, to the non-exclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of America for the Southern
District of New York, and appellate courts from any thereof;

                  (b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;

                  (c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to such
Grantor at its address referred to in Section 8.2 or at such other address of
which the Collateral Agent shall have been notified pursuant thereto;

                  (d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction; and

                  (e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding referred
to in this Section any special, exemplary, punitive or consequential damages.

                  SECTION 8.13. Acknowledgements. Each Grantor hereby
acknowledges that:

                  (a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents to which
it is a party;

                  (b) neither the Collateral Agent nor any Secured Party has any
fiduciary relationship with or duty to any Grantor arising out of or in
connection with this Agreement, the Credit Agreement, the Note Agreements, the
Prudential Notes or any of the other Loan Documents, and the relationship
between the Grantors, on the one hand, and the Collateral Agent and Secured
Parties, on the other hand, in connection herewith or therewith is solely that
of debtor and creditor; and

                  (c) no joint venture is created hereby or by the Credit
Agreement, the Note Agreements, the Prudential Notes or the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Secured Parties or among the Grantors and the Secured Parties.

                  SECTION 8.14. Additional Grantors. Each Subsidiary of the
Borrower that is required to become a party to this Agreement pursuant to
Section 5.11 of the Credit Agreement and Section 5.6 of the Note Agreements
shall become a Grantor for all purposes of this Agreement upon execution and
delivery by such Subsidiary of an Assumption Agreement in the form of Annex 1
hereto. Merchant's, Incorporated and Merban, Inc. shall become a party to this
Agreement upon execution and delivery thereof, provided that such execution and
delivery shall only become effective upon completion of the Merchant's
Acquisition.

                  SECTION 8.15. Releases. (a) At such time as the Loans, the
Reimbursement Obligations, all amounts owing in respect of the Prudential Notes
and the Note Agreements and the other Obligations shall have been paid in full,
the Commitments have been terminated and no Letters of Credit shall be
outstanding, the Collateral shall be released from the Liens created hereby, and
this Agreement and all obligations (other than those expressly stated to survive
such termination) of the Collateral Agent and each Grantor hereunder shall
terminate, all without delivery of any instrument or performance of any act by
any party, and all rights to the Collateral
<PAGE>
shall revert to the Grantors. At the request and sole expense of any Grantor
following any such termination, the Collateral Agent shall deliver to such
Grantor any Collateral held by the Collateral Agent hereunder, and execute and
deliver to such Grantor such documents as such Grantor shall reasonably request
to evidence such termination.

                  (a) If any of the Collateral shall be sold, transferred or
otherwise disposed of by any Grantor in a transaction permitted by the Credit
Agreement and the Note Agreements, then the Collateral Agent, at the request and
sole expense of such Grantor, shall execute and deliver to such Grantor all
releases or other documents reasonably necessary or desirable for the release of
the Liens created hereby on such Collateral. At the request and sole expense of
the Borrower, a Guarantor shall be released from its obligations hereunder in
the event that all the Capital Stock of such Guarantor shall be sold,
transferred or otherwise disposed of in a transaction permitted by the Credit
Agreement and the Note Agreements; provided that the Borrower shall have
delivered to the Collateral Agent, at least ten Business Days prior to the date
of the proposed release, a written request for release identifying the relevant
Subsidiary Guarantor and the terms of the sale or other disposition in
reasonable detail, including the price thereof and any expenses in connection
therewith, together with a certification by the Borrower stating that such
transaction is in compliance with the Credit Agreement, the Note Agreements and
the other Loan Documents.

SECTION 8.16. 1.6 WAIVER OF JURY TRIAL. EACH GRANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

              Continuation of Liens Securing Existing Prudential Notes.

                  In addition to constituting new Liens securing all of the
Borrower Obligations, the Liens created hereby shall be deemed to be a
continuation and confirmation of the Liens created pursuant to the Existing
Security Agreements and an amendment and restatement of the terms and conditions
thereof.

                  SECTION 8.17. Existing Guarantees. The Guarantees executed by
each Subsidiary under the Existing Credit Agreement shall be superceded by the
guarantee contained in Section 2 hereof.
<PAGE>
                  IN WITNESS WHEREOF, each of the undersigned has caused this
Guarantee and Collateral Agreement to be duly executed and delivered as of the
date first above written.

                                        TBC Corporation

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        TBC International Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        Carroll's, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        Big O Tires, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        TBC Retail Enterprises, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:
<PAGE>
                                        Big O Tire of Idaho, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        O Advertising, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        Tire Kingdom, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        Northern States Tire, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        Big O Retail Enterprises, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        Big O Development, Inc.
<PAGE>
                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        TBC Brands, LLC

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        TBC Capital, LLC

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        Merchant's Incorporated

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

                                        Merban, Inc.

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:

<PAGE>

                                                                      Schedule 1

                         NOTICE ADDRESSES OF GUARANTORS

All notices, requests or demands to or upon any Guarantor shall be addressed to
such Guarantor:

                               c/o TBC Corporation
                             4770 Hickory Hill Road
                                Memphis, TN 38141
                                       or
                                 P.O. Box 181342
                             Memphis, TN 38181-0342
<PAGE>
                                                                      Schedule 2

                       DESCRIPTION OF INVESTMENT PROPERTY

PLEDGED STOCK:

<TABLE>
<CAPTION>
ISSUER                              CLASS OF STOCK    CERT. NO.     NO. OF SHARES
------                              --------------    ---------     -------------
<S>                                 <C>               <C>           <C>
TBC International Inc.              Common               2                1

Carroll's, Inc.                     Common              150           2,337,002

Big O Tires, Inc.                   Common               2               100

TBC Retail Enterprises, Inc.        Common               1               100

Big O Tire of Idaho, Inc.           Common              R-1             6,002

O Advertising, Inc.                 Common              R-1            31,000

Tire Kingdom, Inc.                  Common               7             60,000

Northern States Tire, Inc.          Common               2               100

Big O Retail Enterprises, Inc.      Common               2             10,000

Big O Development, Inc.             Common              R-1            20,000

Merchant's, Incorporated            Common

Merban, Inc.                        Common
</TABLE>

UNCERTIFICATED SECURITIES:

<TABLE>
<CAPTION>
Name of Issuer                      Percentage of Membership Interests
--------------                      ----------------------------------
<S>                                 <C>
TBC Brands, LLC                     100% Owned by TBC Corporation

TBC Capital, LLC                    90% Owned by TBC Corporation
                                     5% Owned by Carroll's, Inc.
                                     5% Owned by Tire Kingdom, Inc.
</TABLE>
<PAGE>
                                                                      SCHEDULE 3

               LOCATION OF JURISDICTION AND CHIEF EXECUTIVE OFFICE

<TABLE>
<CAPTION>
                                                                        LOCATION OF CHIEF
GRANTOR                         JURISDICTION OF ORGANIZATION            EXECUTIVE OFFICE
-------                         ----------------------------            ----------------
<S>                             <C>                                     <C>
TBC CORPORATION                         DELAWARE                        4770 HICKORY HILL ROAD
                                                                        MEMPHIS, TN 38141

TBC INTERNATIONAL INC.                  DELAWARE                        4770 HICKORY HILL ROAD
                                                                        MEMPHIS, TN 38141

CARROLL'S, INC.                         GEORGIA                         4281 OLD DIXIE HIGHWAY
                                                                        HAPEVILLE, GA 30254

BIG O TIRES, INC.                       NEVADA                          12650 E. BRIARWOOD AVE.
                                                                        ENGLEWOOD, CO 80112

TBC RETAIL ENTERPRISES, INC.            DELAWARE                        4770 HICKORY HILL ROAD
                                                                        MEMPHIS, TN 38141

BIG O TIRE OF IDAHO, INC.               IDAHO                           12650 E. BRIARWOOD AVE.
                                                                        ENGLEWOOD, CO 80112

O ADVERTISING, INC.                     COLORADO                        12650 E. BRIARWOOD AVE.
                                                                        ENGLEWOOD, CO 80112

TIRE KINGDOM, INC.                      FLORIDA                         2001 N. CONGRESS AVE.
                                                                        RIVIERA BEACH, FL 33404

NORTHERN STATES TIRE, INC.              DELAWARE                        4770 HICKORY HILL ROAD
                                                                        MEMPHIS, TN 38141

BIG O RETAIL ENTERPRISES, INC.          COLORADO                        4770 HICKORY HILL ROAD
                                                                        MEMPHIS, TN 38141

BIG O DEVELOPMENT, INC.                 COLORADO                        2650 E. BRIARWOOD AVE.
                                                                        ENGLEWOOD, CO 80112

TBC BRANDS, LLC                         DELAWARE                        SUITE 390-P
                                                                        630 ISBELL ROAD
                                                                        RENO, NV 89509

TBC CAPITAL, LLC                        DELAWARE                        SUITE 390-P
                                                                        630 ISBELL ROAD
                                                                        RENO, NV 89509

MERCHANT'S, INCORPORATED                DELAWARE                        9073 EUCLID AVE.
                                                                        MANASSAS, VA 22110
</TABLE>
<PAGE>
<TABLE>
<S>                             <C>                                     <C>
MERBAN, INC.                            VIRGINIA                        9073 EUCLID AVE.
                                                                        MANASSAS, VA 22110
</TABLE>
<PAGE>
                                                                      SCHEDULE 4

              TRADEMARKS, TRADENAMES, SERVICE MARKS, AND COPYRIGHTS

                               TIRE KINGDOM, INC.

<TABLE>
TRADEMARK REPORT BY MARK                                                                         PRINTED: 3/28/2003        PAGE    1
STATUS: ACTIVE
COUNTRY                            FILED            APPL#              REGDT          REG#            STATUS                 CLASSES
<S>                                <C>              <C>                <C>            <C>             <C>                    <C>
MISCELLANEOUS [CROWN] DESIGN

UNITED STATES                      9/1/1999         75/791,760         6/27/2000      2,363,324       REGISTERED                  35

TIRE KINGDOM

UNITED STATES                      2/5/2003         76/487,769                                        PENDING                     35

UNITED STATES                      12/10/1992       74/338,671         5/31/1994      1,838,215       REGISTERED                  42

TIRE KINGDOM & DESIGN

UNITED STATES                      2/5/2003         76/487,604                                        PENDING                     35

                                                 END OF                                               TOTAL ITEMS SELECTED =       4
</TABLE>

                               BIG O TIRES, INC.

<TABLE>
TRADEMARK REPORT BY MARK                                                                         PRINTED: 3/28/2003        PAGE    1
STATUS: ACTIVE
COUNTRY                            FILED            APPL#              REGDT          REG#            STATUS                 CLASSES
<S>                                <C>              <C>                <C>            <C>             <C>                    <C>
A REPUTATION YOU CAN RIDE ON

UNITED STATES                      2/22/1993        74/360,838         7/19/1994      1,845,544       REGISTERED               37,42

ASPEN

UNITED STATES                      3/25/1988        73/718,614         10/11/1988     1,508,041       REGISTERED                  12

BIG FOOT

CANADA                             3/15/1988        602897             3/13/1992      395398          REGISTERED                   A

MEXICO                             5/15/1998        332727             10/20/2000     674604          REGISTERED                  12

UNITED STATES                      5/7/1993         74/389,931         7/11/1995      1,904,955       REGISTERED                  12

BIG FOOT 60
UNITED STATES                      9/6/1974         73/031,264         9/12/1978      1,102,058       REGISTERED                  12

BIG FOOT 70
UNITED STATES                      9/16/1974        73/031,311         9/12/1978      1,102,059       REGISTERED                  12

BIG HAUL

UNITED STATES                      10/3/1974        73/033,736         8/26/1975      1,018,800       REGISTERED                  12

BIG LIFT

CANADA                             3/9/1998         871625                                            ALLOWED                     37

UNITED STATES                      9/17/1997        75/358,399         12/18/2001     2,520,443       REGISTERED               35,37

BIG O
</TABLE>
<PAGE>
<TABLE>
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
MEXICO                             5/15/1998        332726             10/20/2000     674603          REGISTERED                  12

TEXAS                              9/2/1982         N/A                9/2/1982       40704           REGISTERED                  12

TEXAS                              11/1/1982        40967              11/1/1982      40967           REGISTERED                  42

UNITED STATES                      1/14/1974        73/010,921         9/24/1974      993,415         REGISTERED                  12

UNITED STATES                      9/10/1973        73/000,572         10/1/1974      994,466         REGISTERED                  42

BIG O TIRES

CANADA                             6/18/1987        586384             10/27/1989     361490          REGISTERED                 N/A

CANADA                             5/5/1999         1,014,484          2/21/2002      TMA558285       REGISTERED            12,35,37

MEXICO                             5/15/1998        332728             10/20/2000     674605          REGISTERED                  42

UNITED STATES                      4/12/1999        75/679,597         12/12/2000     2,411,926       REGISTERED            12,35,37

BIG O TIRES & DESIGN

CANADA                                                                 6/12/1981      259,938         REGISTERED                 N/A

CANADA                             3/27/1991        682687             11/12/1993     TMA419439       REGISTERED                 N/A

BIG O TIRES AND DESIGN

UNITED STATES                      12/4/1989        74/007,344         8/28/1990      1,611,160       REGISTERED               12,42

COST U LESS & DESIGN

CANADA                             8/5/1994         761237             10/28/1997     TMA484761       REGISTERED                A,Aa

MEXICO                             8/9/1994         207912             10/11/1994     476693          REGISTERED                37,A

MEXICO                             8/9/1994         207911             10/5/1994      476099          REGISTERED                  42

COSTULESS & Design

UNITED STATES                      7/12/1994        74/548,947         1/30/1996      1,952,457       REGISTERED            12,37,42

DARE TO COMPARE

UNITED STATES                      4/20/2000        76/030,453         9/25/2001      2,492,236       REGISTERED                 035

DESIGN OF BIG FOOT

CANADA                             5/5/1999         1,014,482          3/15/2001      TMA542,415      REGISTERED            12,35,37

UNITED STATES                      4/12/1999        75/680,850         2/1/2000       2,314,775       REGISTERED            12,35,37

EURO TOUR

CANADA                             1/15/2003        1164833                                           PENDING                     12

MEXICO                             2/3/2003         586480                                            PENDING                     12

UNITED STATES                      11/8/2002        76/468,502                                        PENDING                     12

EXTRA CARE & DESIGN

UNITED STATES                      3/24/1986        589,583            11/18/1986     1,417,730       REGISTERED                  37

UNITED STATES                      3/24/1986        73/589,583         11/18/1986     1,417,730       REGISTERED                  37

HYDRO-TRAC

MEXICO                             1/14/1994        188025             5/4/1994       459327          REGISTERED                  12

LEGACY

CANADA                             3/15/1988        602896             3/13/1992      395397          REGISTERED                 N/A

COLORADO                           10/28/1985       N/A                10/28/1985     T29645          REGISTERED                  35

COLORADO                                                               4/22/1976      T30670          REGISTERED

MEXICO                             1/14/1994        188026             5/4/1994       459328          REGISTERED                  12

UNITED STATES                      10/31/1985       73/566,064         5/20/1986      1,393,967       REGISTERED                  12
</TABLE>
<PAGE>
<TABLE>
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
LIGHTENING

MEXICO                             1/14/1994        188027             12/6/1994      481629          REGISTERED               12,35

PATHMAX

UNITED STATES                      8/3/1998         75/529,550         9/28/1999      2,281,419       REGISTERED                  12

PROCOMP

MEXICO                             1/14/1994        188028             5/4/1994       459329          REGISTERED              12, 35

PROCOMP HIGH PERFORMANCE

UNITED STATES                      7/27/1992        74/298,320         7/5/1994       1,842,854       REGISTERED                  12

SASQUATCH [BIG FOOT] DESIGN

CANADA                             5/5/1999         1,014,483          1/16/2003      TMA573769       REGISTERED            12,35,37

SONIC COMMERICAL

UNITED STATES                      12/2/1964        72/207,339         3/15/1966      805,578         REGISTERED                  12

SUN VALLEY

UNITED STATES                      10/31/1968       72/310,988         6/17/1969      871,318         REGISTERED                  35

VENGEANCE

CANADA                             1/2/2003         N/A                                               PENDING

MEXICO                             1/7/2003         582675                                            PENDING

UNITED STATES                      10/18/2002       76/460,700                                        PENDING                     12

WWW.BIGOTIRES.COM & DESIGN

CANADA                             3/20/2001        1096649                                           PENDING

MEXICO                             3/29/2001        478565             8/30/2001      713395          REGISTERED                  37

MEXICO                             3/29/2001        478566                                            PENDING                     42

UNITED STATES                      12/1/2000        76/174,243         12/4/2001      2,514,975       REGISTERED              35, 37

                                                  END OF                                              TOTAL ITEMS SELECTED =      63
</TABLE>

                                 TBC BRANDS, LLC

<TABLE>
TRADEMARK REPORT BY MARK                                                                         PRINTED: 3/28/2003        PAGE    1
STATUS:            ACTIVE
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
COUNTRY                            FILED            APPL#              REGDT          REG#            STATUS                CLASSES

AQUA FLOW

CANADA                             3/9/1993         724,287            7/15/1994      430478          REGISTERED                 N/A

JAPAN                              8/25/1993        87543/93           7/31/1996      3183343         REGISTERED                  12

MEXICO                             3/24/1993        163889             8/3/1993       438707          REGISTERED                  12

UNITED STATES                      11/24/1992       74/334,184         1/4/1994       1,815,411       REGISTERED                  12

AQUA FLOW III

CANADA                             2/5/2001         1091561                                           ALLOWED

MEXICO                             3/13/2001        475492             5/24/2001      699369          REGISTERED

UNITED STATES                      9/13/2000        76/128,049         4/2/2002       2,557,298       REGISTERED                  12

BROADWAY CLASSIC

UNITED STATES                      12/4/2002        76/472,568                                        PENDING                     12

CENTRED
</TABLE>
<PAGE>
<TABLE>
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
CANADA                             2/19/1999        1006129            10/18/2000     TMA535,038      REGISTERED                  12

MEXICO                             4/23/1999        372561             2/29/2000      644642          REGISTERED                  12

UNITED STATES                      1/15/1999        75/621,314         3/20/2001      2,437,511       REGISTERED                  12

CENTRON

UNITED STATES                      3/12/1985        73/526,552         9/3/1985       1,357,941       REGISTERED                  12

CENTURY

CANADA                             9/10/1999        1,028,617          11/22/2002     TMA571137       REGISTERED                 N/A

UNITED STATES                      7/30/1999        75/764,830         7/17/2001      2,470,426       REGISTERED                  12

CORDOVAN

CANADA                             3/8/1990         652,673            4/5/1991       382741          REGISTERED                  12

CHINA                              6/28/2002        3225736                                           PENDING                     12

EUROPEAN UNION                     12/30/1997       719351             4/7/1999       000719351       REGISTERED                9,12

FRANCE                             4/25/1991        282653             4/25/1991      1657817         REGISTERED                9,12

GERMANY                            4/30/1991        T 31 825/12 W      7/14/1992      2017105         REGISTERED                9,12

MEXICO                             12/19/1997       318673             2/27/1998      571618          REGISTERED                  12

SOUTH KOREA                        6/28/2002        2002-30152                                        PENDING                     12

UNITED KINGDOM                     4/24/1991        1462329            4/24/1991      1462329         REGISTERED                  12

UNITED KINGDOM                     5/21/1991        1464865            5/21/1991      1464865         REGISTERED                   9

UNITED STATES                      9/27/1985        73/560,572         12/2/1986      1,419,104       REGISTERED               12,17

UNITED STATES                      6/15/1945        72/159,045         8/27/1963      755,493         REGISTERED                  35

CORDOVAN BONNEVILLE JET (STYLIZED)
UNITED STATES                      5/19/1964        72/193,756         2/9/1965       784,838         REGISTERED                  35

CORDOVAN RADIAL G/T

UNITED STATES                      11/29/1976       73/108,055         9/19/1978      1,102,631       REGISTERED                  12

CORDOVAN WIDE 600
UNITED STATES                      8/30/1967        72/279,376         8/6/1968       854,177         REGISTERED                  35

CRITERION

UNITED STATES                      2/29/1980        73/252,026         9/15/1981      1,169,191       REGISTERED                  12

EPIC

CANADA                             6/13/2000        1,063,059          8/7/2002       TMA565594       REGISTERED                 N/A

MEXICO                             1/4/1995         220948             3/28/1995      486515          REGISTERED                  12

UNITED STATES                      9/10/1985        73/559,173         4/8/1986       1,388,996       REGISTERED                  12

EXCEL

CANADA                             9/10/1999        1,028,616                                         ALLOWED                    N/A

UNITED STATES T30505US0            7/30/1999        75/764,829         7/17/2001      2,470,425       REGISTERED                  12

FRONT LINE & DESIGN

UNITED STATES                      5/7/1985         73/536,361         11/5/1985      1,368,849       REGISTERED                  12

FRONTLINE

MEXICO                             10/21/1994       216047             8/30/1995      502347          REGISTERED                  12

GRAN ESPRIT

EUROPEAN UNION                     9/19/1996        385617             8/28/1998      385617          REGISTERED                  12

UNITED STATES                      5/20/1996        75/107,105         4/14/1998      2,151,303       REGISTERED                  12
</TABLE>
<PAGE>
<TABLE>
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
GRAND AM

CANADA                             12/29/1994       772,065            6/14/1996      459411          REGISTERED                  12

MEXICO                             10/13/1994       215380             11/22/1994     480234          REGISTERED                  12

GRAND PRIX

CANADA                             10/26/1993       739674             3/16/1999      TMA509,415      REGISTERED                 N/A

MEXICO                             11/8/1993        182542                                            PENDING                     12

MEXICO                             8/30/1994        210274             11/18/1994     479812          REGISTERED                   7

UNITED STATES                      5/5/1980         73/260,923         12/29/1981     1,183,571       REGISTERED                  11

UNITED STATES                      10/26/1982       73/400,864         11/22/1983     1,258,438       REGISTERED                   9

UNITED STATES                      12/12/1975       73/071,592         10/25/1977     1,075,901       REGISTERED                  12

UNITED STATES                      8/24/1987        73/680,289         8/27/1991      1,655,035       REGISTERED                  37

GRAND PRIX & DESIGN

UNITED STATES                      3/17/1982        73/355,136         1/18/1983      1,224,147       REGISTERED                  12

UNITED STATES                      3/25/1959        72/070,188         12/22/1959     690,249         REGISTERED                  35

GRAND PRIX RADIAL G/T (STYLIZED)
UNITED STATES                      5/5/1980         73/260,924         8/11/1981      1,164,594       REGISTERED                  12

GRAND SPIRIT

MEXICO                             7/24/1995        238249                                            PENDING                     12

UNITED STATES                      1/24/1994        74/481,579         2/27/1996      1,958,273       REGISTERED                  12

GRAND SPIRIT TOURING LS

UNITED STATES                      12/4/2002        76/472,572                                        PENDING                     12

GRAND SPORT

CANADA                             4/12/1990        654,898            3/6/1992       TMA 395,089     REGISTERED                  12

MEXICO                             1/4/1995         220944             4/23/1997      546167          REGISTERED                  12

UNITED STATES                      5/13/1986        73/598,547         12/23/1986     1,421,825       REGISTERED                  12

HARVEST KING

CANADA                             12/29/1994       772,070            1/19/1996      TMA452894       REGISTERED                  12

CHINA                              1/30/2002        3084124                                           ALLOWED                     12

MEXICO                             10/13/1994       215383             7/21/1995      497846          REGISTERED                  12

SOUTH KOREA                        6/28/2002        2002-31154                                        PENDING

UNITED STATES                      6/19/1989        73/807,530         5/8/1990       1,595,216       REGISTERED                  12

HIGHWAY SCOUT RADIAL HTP

UNITED STATES                      3/17/2000        76/004,068         4/9/2002       2,559,952       REGISTERED                  12

LIVE ONE (STYLIZED)
UNITED STATES                      8/10/1976        73/096,101         12/13/1977     1,079,273       REGISTERED                   9

MATRIX

BRAZIL                             10/25/1999       822129833                                         PENDING

UNITED STATES                      3/13/1985        73/562,619         3/1/1988       1,478,574       REGISTERED                  12

MILEAGE MASTER

UNITED STATES                      3/12/2003        76/497,354                                        PENDING
</TABLE>
<PAGE>
<TABLE>
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
MULTI-MILE

CANADA                             2/29/2000        654903(1)          4/12/1991      TMA383056       REGISTERED                  12

CHINA                              6/28/2002        3225735                                           PENDING                     12

EUROPEAN UNION                     12/30/1997       719260             4/7/1999       000719260       REGISTERED                9,12

FRANCE                             4/24/1991        282446             4/2/1991       1657653         REGISTERED                9,12

MEXICO                             3/24/1993        163887             7/3/1993       438706          REGISTERED                  12

MEXICO                             10/21/1994       216045             3/22/1995      485680          REGISTERED                   9

SOUTH KOREA                        6/28/2002        2002-30153                                        PENDING

UNITED KINGDOM                     4/23/1991        1462051            4/23/1991      B1462051        REGISTERED                  12

UNITED KINGDOM                     5/21/1991        1464866            5/21/1991      B1464866        REGISTERED                   9

UNITED STATES                      8/23/1982        73/381,561         11/29/1983     1,259,363       REGISTERED                  12

UNITED STATES                      5/15/1998        75/485,588         8/3/1999       2,266,907       REGISTERED                  12

MULTI-MILE (STYLIZED)
UNITED STATES                      5/11/1950        71/597,256         6/24/1952      560,428         REGISTERED                  12

MULTI-MILE RADIAL G/T (STYLIZED)
UNITED STATES                      11/29/1976       73/108,056         9/18/1979      1,125,174       REGISTERED                  12

MULTI-MILE WIDE '600'
UNITED STATES                      8/30/1967        72/279,377         8/6/1968       854,178         REGISTERED                  35

MULTI-TRAC

MEXICO                             10/13/1994       215381             7/19/1995      497555          REGISTERED                  12

UNITED STATES                      3/22/1973        72/452,297         3/26/1974      981,104         REGISTERED                  35

POWER KING

CANADA                             4/12/1990        654,907            4/5/1991       382759          REGISTERED                  12

CHINA                              1/30/2002        3084106                                           ALLOWED                     12

MEXICO                             6/11/1998        336096                                            PENDING                     12

SOUTH KOREA                        6/28/2002        2002-30155                                        PENDING                     12

UNITED STATES                      4/5/1979         73/210,451         7/29/1980      1,138,319       REGISTERED                  12

POWER KING (STYLIZED)
UNITED STATES                      2/7/1983         73/412,703         4/3/1984       1,272,524       REGISTERED                   9

POWER KING IMT

UNITED STATES                      6/21/2002        76/424,630                                        PENDING                     12

PR812

UNITED STATES                      11/8/2002        76/468,503                                        PENDING                     12

PRESTIGE

CANADA                             5/27/1959        251153             12/11/1959     116209          REGISTERED                 N/A

UNITED STATES                      9/1/1954         71/672,582         6/7/1955       607,037         REGISTERED                  35

REGENT

CANADA                             8/3/2000         1,069,844                                         PENDING

MEXICO                             11/21/2000       459062             8/16/2002      758958          REGISTERED                  12

UNITED STATES                      12/17/1999       75/874,916         6/26/2001      2,464,646       REGISTERED                  12

SCEPTOR

UNITED STATES                      5/13/1986        73/598,549         12/23/1986     1,421,827       REGISTERED                  12
</TABLE>
<PAGE>
<TABLE>
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
SHADOW

CANADA                             8/3/2000         1,069,845                                         PENDING

MEXICO                             9/11/2002        565576                                            PENDING

UNITED STATES*                     12/17/1999       75/874,915                                        PENDING                     12

* IN THE NAME OF  TBC CORPORATION

SIGMA

CANADA                             4/12/1990        654,894            4/5/1991       382758          REGISTERED                  12

CHINA                              6/28/2002        3225734                                           PENDING                     12

GERMANY                            6/10/1991        T 32 059/12 W      7/14/1992      2017108         REGISTERED                  12

MEXICO                             5/29/1995        N/A                7/27/1995      499136          REGISTERED                  12

MEXICO                             5/29/1995        N/A                7/27/1995      499136          REGISTERED                  12

SOUTH KOREA                        6/28/2002        2002-30151                                        PENDING

UNITED KINGDOM                     6/6/1991         1466536            6/6/1991       1466536         REGISTERED                  12

UNITED STATES                      5/15/1998        75/485,561         7/20/1999      2,262,889       REGISTERED                  12

SIGMA & DESIGN

UNITED STATES                      12/28/1973       73/009,844         11/19/1974     998,427         REGISTERED                  12

SIGMA SUPREME HP

CANADA                             8/3/2000         1,069,847                                         ALLOWED

MEXICO                             11/21/2000       459065             12/14/2001     728573          REGISTERED

UNITED STATES                      7/26/2000        76/096,412         6/4/2002       2,575,403       REGISTERED                  12

SIGMA SUPREME TR

CANADA                             8/3/2000         1,069,848                                         ALLOWED

MEXICO                             11/21/2000       459064             12/14/2001     728572          REGISTERED                  12

UNITED STATES                      12/17/1999       75/874,912         3/26/2002      2,553,584       REGISTERED                  12

SOVRAN

UNITED STATES                      7/27/1989        73/815,288         6/12/1990      1,600,677       REGISTERED                  12

STAMPEDE

CANADA                             12/29/1994       772,066            11/3/1995      TMA449689       REGISTERED                  12

MEXICO                             1/4/1995         220945             3/28/1995      486513          REGISTERED                  12

UNITED STATES                      9/18/1984        73/499,961         5/28/1985      1,337,798       REGISTERED                  12

SUSSEX

UNITED STATES                      5/13/1986        73/598,548         12/23/1986     1,421,826       REGISTERED                  12

TALON

CANADA                             12/29/1994       772,067            11/3/1995      TMA449690       REGISTERED                  12

MEXICO                             1/4/1995         220943             3/28/1995      486512          REGISTERED                  12

UNITED STATES                      9/10/1985        73/559,172         4/8/1986       1,388,995       REGISTERED                  12

TBC

MEXICO                             8/6/1999         385997                                            PENDING                     12

UNITED STATES                      10/26/1983       73/449,847         7/2/1985       1,345,491       REGISTERED                9,12

UNITED STATES                      6/13/1978        73/174,209         2/20/1979      1,113,549       REGISTERED                  12

UNITED STATES                      6/8/1995         74/685,983         11/25/1997     2,114,992       REGISTERED            35,36,42

TBC BRANDS

UNITED STATES                      2/12/2002        76/369,496                                        ALLOWED                9,12,16
</TABLE>
<PAGE>
<TABLE>
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
TBC ONLINE

CANADA                             4/16/1998        875566             6/29/2000      TMA529893       REGISTERED                   9

MEXICO                             12/16/1998       340767                                            PENDING                      9

UNITED STATES                      1/23/1998        75/423,437         1/25/2000      2,312,424       REGISTERED                   9

TBC PRIVATE BRANDS & DESIGN

UNITED STATES                      2/12/2002        76/369,492                                        ALLOWED                     35

TEMPEST

CANADA                             8/3/2000         1,069,846                                         ALLOWED

MEXICO                             11/21/2000       459063             12/14/2001     728571          REGISTERED                  12

UNITED STATES                      12/17/1999       75/874,914         6/19/2001      2,462,822       REGISTERED                  12

TODAY

UNITED STATES                      2/25/1994        74/494,330         1/21/1997      2,032,519       REGISTERED                  12

TRAIL GUIDE RADIAL ATP

UNITED STATES                      3/17/2000        76/004,067         4/2/2002       2,557,059       REGISTERED                  12

TRAIL GUIDE RT

CANADA                             3/12/2003        N/A                                               PENDING

UNITED STATES                      12/4/2002        76/472,525                                        PENDING                     12

TRAIL SCOUT

MEXICO                             7/30/1999        385267             9/22/1999      624142          REGISTERED                  12

UNITED STATES                      4/12/1999        75/679,588         7/3/2001       2,466,356       REGISTERED                  12

TRAILER KING

UNITED STATES                      3/12/2003        76/497,369                                        PENDING

TURBO-TECH

UNITED STATES                      7/18/1989        73/813,331         10/2/1990      1,615,599       REGISTERED                  12

ULTRA CELL

UNITED STATES                      11/1/1984        73/506,662         6/11/1985      1,340,421       REGISTERED                   9

ULTRA LIFE

UNITED STATES                      11/5/1984        73/507,226         11/19/1985     1,371,051       REGISTERED                   9

ULTREX

UNITED STATES                      3/16/1994        74/500,719         4/16/1996      1,968,838       REGISTERED                  12

VANDERBILT

UNITED STATES                      10/6/1961        72/129,434         6/11/1963      750,869         REGISTERED                  12

VANDERBILT TOURING

UNITED STATES                      12/4/2002        76/472,570                                        PENDING                     12

WILD COUNTRY

CANADA                             12/29/1994       772,071            1/19/1996      TMA452895       REGISTERED                  12

MEXICO                             1/4/1995         220947             3/28/1995      486514          REGISTERED                  12

UNITED STATES                      6/30/1992        74/289,945         3/2/1993       1,755,187       REGISTERED                  12

WILD SPIRIT RADIAL GTX
</TABLE>
<PAGE>
<TABLE>
<S>                                <C>              <C>                <C>            <C>             <C>                   <C>
UNITED STATES                      12/1/1992        74/335,812         2/15/1994      1,822,004       REGISTERED                  12

WILD SPIRIT TOURING LS

UNITED STATES                      12/4/2002        76/472,571                                        PENDING                     12

WILD TRAC

CANADA                             12/29/1994       772,069            5/9/1997       TMA475995       REGISTERED                  12

MEXICO                             1/4/1995         220937             3/28/1995      486510          REGISTERED                  12

UNITED STATES                      7/3/1978         73/177,148         7/17/1979      1,122,304       REGISTERED                  12

                                                                   END OF                             TOTAL ITEMS SELECTED =     168
</TABLE>

                    MERCHANT'S, INCORPORATED AND MERBAN, INC.
                 (after Closing Date of Merchant's Acquisition)

<TABLE>
<CAPTION>
                                   REGISTRATION NO. REGISTRATION DATE
                                   ---------------- -----------------
<S>                                <C>              <C>
Team Merchant's Performance
Specialists

UNITED STATES                      2,248,803        09/17/2000

29 Minutes or Less, Tire Express

UNITED STATES                      2,077,075        07/18/1997

No One Cares for Your Car
Like Merchant's

UNITED STATES                      2,389,988        09/26/2000

Ready to Roll Tire Pricing

UNITED STATES                      75/564,275       SUBJECT TO PENDING OPPOSITION FILING

Merchant's Maintenance Alert

UNITED STATES                      2,078,719        07/15/1997

Merchant's Tire & Auto Center

UNITED STATES                      1,420,446        11/14/87
                                                    11/30/92
                                                    04/05/93

Service That You Trust -
  Guaranteed

UNITED STATES                      1,743,581        12/29/1992

Merchant's

UNITED STATES                      1,907,199        07/28/1995
</TABLE><PAGE>
                                                                     EXHIBIT 4.2

                                 TBC CORPORATION

                   SECOND AMENDED AND RESTATED NOTE AGREEMENT

                                   $19,500,000

                     SERIES A SENIOR NOTES DUE JULY 10, 2003

                                   $11,000,000

                     SERIES B SENIOR NOTES DUE JULY 10, 2005

                                   $16,500,000

                     SERIES C SENIOR NOTES DUE JULY 10, 2008

                            DATED AS OF APRIL 1, 2003

<PAGE>

                                TABLE OF CONTENTS
                             (not part of agreement)

<TABLE>
<CAPTION>
                                                                                                                PAGE
<S>   <C>                                                                                                       <C>
1.    THE NOTES...................................................................................................1

   1.1.  BACKGROUND...............................................................................................1
   1.2.  AUTHORIZATION OF AMENDMENT AND RESTATEMENT...............................................................2
   1.3.  NOTES IN SERIES..........................................................................................3

2.    AUTHORIZATION OF AMENDMENT AND RESTATEMENT..................................................................3

3.    CONDITIONS SUBSEQUENT TO EFFECTIVENESS......................................................................3

   3.1.  CERTAIN DOCUMENTS........................................................................................3
   3.2.  COMPANY REPRESENTATIONS AND WARRANTIES; NO DEFAULT; ETC..................................................4
   3.3.  SUBSIDIARY REPRESENTATIONS AND WARRANTIES; NO DEFAULTS...................................................4
   3.4.  TRANSACTIONS PERMITTED BY APPLICABLE LAWS................................................................5
   3.5.  PAYMENT OF AMENDMENT FEE.................................................................................5
   3.6.  INTERCREDITOR AGREEMENT..................................................................................5
   3.7.  CREDIT AGREEMENT.........................................................................................5
   3.8.  GUARANTEE AND COLLATERAL AGREEMENT.......................................................................5
   3.9.  NEW MORTGAGE.............................................................................................5
   3.10.    EVIDENCE OF FILING AND RECORDING, ETC.................................................................5
   3.11.    TERMINATION OF EXISTING CREDIT AGREEMENT..............................................................6
   3.12.    COPIES OF ENVIRONMENTAL AUDITS........................................................................6
   3.13.    CLEAR LIEN SEARCH REPORT..............................................................................6
   3.14.    RECEIPT BY COLLATERAL AGENT OF PLEDGED STOCK AND NOTES................................................6
   3.15.    CONSUMMATION OF ACQUISITION OF MERCHANT'S, INCORPORATED...............................................6
   3.16.    EXPENSES..............................................................................................6
   3.17.    PROCEEDINGS SATISFACTORY..............................................................................6

4.    PREPAYMENTS.................................................................................................7

   4.1.  REQUIRED PREPAYMENTS OF SERIES B AND SERIES C NOTES......................................................7
   4.2.  OPTIONAL PREPAYMENT WITH YIELD-MAINTENANCE AMOUNT........................................................7
   4.3.  NOTICE OF OPTIONAL PREPAYMENT............................................................................7
   4.4.  APPLICATION OF REQUIRED PREPAYMENTS......................................................................8
   4.5.  APPLICATION OF OPTIONAL PREPAYMENTS......................................................................8
   4.6.  NO ACQUISITION OF NOTES..................................................................................8
   4.7.  CHANGE IN CONTROL PREPAYMENT.............................................................................8
   4.8.  PREPAYMENT OF NOTES PURSUANT TO DEBT PREPAYMENT APPLICATION.............................................11

5.    AFFIRMATIVE COVENANTS......................................................................................13

   5.1.  FINANCIAL STATEMENTS; NOTICE OF DEFAULTS................................................................13
   5.2.  NOTICE OF CERTAIN MATERIAL EVENTS.......................................................................15
   5.3.  ERISA NOTICES...........................................................................................15
   5.4.  INFORMATION REQUIRED BY RULE 144A.......................................................................16
   5.5.  BOOKS AND RECORDS; INSPECTION OF PROPERTY...............................................................16
   5.6.  SUBSIDIARY GUARANTEES AND COLLATERAL....................................................................16
   5.7.  ENVIRONMENTAL LAWS......................................................................................17
   5.8.  ADDITIONAL COLLATERAL, ETC..............................................................................18
   5.9.  TITLE INSURANCE, FLOOD INSURANCE, ETC...................................................................19
   5.10.    MAINTENANCE OF INSURANCE.............................................................................20
   5.11.    MAINTENANCE OF PROPERTIES; COMPLIANCE WITH LAWS......................................................20
   5.12.    CORPORATE EXISTENCE, ETC.; BUSINESS..................................................................21
   5.13.    PAYMENT OF TAXES AND CLAIMS..........................................................................21
   5.14.    USE OF PROCEEDS......................................................................................21
</TABLE>
<PAGE>

<TABLE>
<S>   <C>                                                                                                       <C>

   5.15.    INTERCOMPANY LOANS; PAYMENTS.........................................................................21
   5.16.    MAINTENANCE OF MOST FAVORED LENDER STATUS............................................................22

6.    NEGATIVE COVENANTS.........................................................................................22

   6.1.  FINANCIAL COVENANTS.....................................................................................22
   6.2.  LIMITATION ON INDEBTEDNESS..............................................................................24
   6.3.  LIENS...................................................................................................25
   6.4.  FUNDAMENTAL CHANGES.....................................................................................26
   6.5.  INVESTMENTS, LOANS, ADVANCES, GUARANTEES AND ACQUISITIONS...............................................27
   6.6.  HEDGING AGREEMENTS......................................................................................29
   6.7.  TRANSACTIONS WITH AFFILIATES............................................................................29
   6.8.  RESTRICTIVE AGREEMENTS..................................................................................29
   6.9.  DISCLOSURE..............................................................................................30
   6.10.    SALE OF ASSETS.......................................................................................30
   6.11.    RESTRICTED PAYMENTS..................................................................................31

7.    EVENTS OF DEFAULT..........................................................................................31

   7.1.  ACCELERATION............................................................................................31
   7.2.  RESCISSION OF ACCELERATION..............................................................................35
   7.3.  NOTICE OF ACCELERATION OR RESCISSION....................................................................35
   7.4.  OTHER REMEDIES..........................................................................................36

8.    REPRESENTATIONS, COVENANTS AND WARRANTIES..................................................................36

   8.1.  ORGANIZATION............................................................................................36
   8.2.  FINANCIAL STATEMENTS....................................................................................36
   8.3.  ACTIONS PENDING.........................................................................................37
   8.4.  OUTSTANDING INDEBTEDNESS................................................................................37
   8.5.  TITLE TO PROPERTIES.....................................................................................37
   8.6.  TAXES...................................................................................................37
   8.7.  CONFLICTING AGREEMENTS AND OTHER MATTERS................................................................37
   8.8.  MARGIN SECURITIES.......................................................................................38
   8.9.  ERISA...................................................................................................38
   8.10.    GOVERNMENTAL CONSENT.................................................................................38
   8.11.    ENVIRONMENTAL COMPLIANCE.............................................................................39
   8.12.    DISCLOSURE...........................................................................................39
   8.13.    TRADEMARKS; TRADENAMES, ETC..........................................................................39
   8.14.    STATUS UNDER CERTAIN STATUTES........................................................................39
   8.15.    ANTI-TERRORISM ORDER.................................................................................39
   8.16.    EXISTING MORTGAGE....................................................................................40

9.    REPRESENTATIONS OF THE NOTEHOLDER..........................................................................40

   9.1.  SOURCE OF FUNDS.........................................................................................40

10.   DEFINITIONS; ACCOUNTING MATTERS............................................................................42

   10.1.    YIELD-MAINTENANCE TERMS..............................................................................42
   10.2.    OTHER DEFINED TERMS..................................................................................43
   10.3.    ACCOUNTING PRINCIPLES, TERMS AND DETERMINATIONS......................................................59

11.   MISCELLANEOUS..............................................................................................59

   11.1.    NOTE PAYMENTS........................................................................................59
   11.2.    EXPENSES.............................................................................................59
   11.3.    CONSENT TO AMENDMENTS................................................................................60
   11.4.    FORM, REGISTRATION, TRANSFER AND EXCHANGE OF NOTES; LOST NOTES.......................................60
   11.5.    PERSONS DEEMED OWNERS; PARTICIPATIONS................................................................61
</TABLE>

                                       ii
<PAGE>

<TABLE>
<S>   <C>                                                                                                       <C>
   11.6.    SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.........................................61
   11.7.    SUCCESSORS AND ASSIGNS...............................................................................61
   11.8.    INDEPENDENCE OF COVENANTS; SEVERABILITY; DESCRIPTIVE HEADINGS........................................62
   11.9.    NOTICES..............................................................................................62
   11.10.   PAYMENTS DUE ON NON-BUSINESS DAYS....................................................................62
   11.11.   MINIMUM INTEREST PAYABLE.............................................................................62
   11.12.   CONSENT TO JURISDICTION; WAIVER OF IMMUNITIES........................................................63
   11.13.   SATISFACTION REQUIREMENT.............................................................................64
   11.14.   GOVERNING LAW........................................................................................64
   11.15.   COUNTERPARTS.........................................................................................64
   11.16.   BINDING AGREEMENT....................................................................................64
</TABLE>

SCHEDULES AND EXHIBITS
----------------------

Purchaser Schedule

SCHEDULE 5.15   --     Intercompany Loans
SCHEDULE 6.2(b) --     Existing Indebtedness and Guarantees
SCHEDULE 6.2(e) --     Guarantees of Big O and its Subsidiaries
SCHEDULE 6.3    --     Existing Liens
SCHEDULE 6.5(b) --     Existing Investments
SCHEDULE 6.8    --     Restrictive Agreements
SCHEDULE 6.10   --     Certain Dispositions of Assets
SCHEDULE 8.7    --     Conflicting Agreements
SCHEDULE 8.13   --     Trademarks, Tradenames etc.

Exhibit 1A   --    Form of Series A Note
Exhibit 1B   --    Form of Series B Note
Exhibit 1C   --    Form of Series C Note
Exhibit 3.6  --    Form of Intercreditor Agreement
Exhibit 3.8  --    Form of Guarantee and Collateral Agreement
Exhibit 3.9  --    Form of New Mortgage

                                      iii
<PAGE>

                                 TBC CORPORATION
                             4770 HICKORY HILL ROAD
                            MEMPHIS, TENNESSEE 38141

                  8.30% SERIES A SENIOR NOTES DUE JULY 10, 2003
                  8.62% SERIES B SENIOR NOTES DUE JULY 10, 2005
                  8.81% SERIES C SENIOR NOTES DUE JULY 10, 2008

                                                             As of April 1, 2003

The Prudential Insurance Company
of America ("PRUDENTIAL")

c/o Prudential Capital Group
Two Ravinia Drive, Suite 1400
Atlanta, Georgia  30346

Ladies and Gentlemen:

         The undersigned, TBC CORPORATION (herein called the "COMPANY"), hereby
agrees with you as follows:

1.       THE NOTES.

         1.1.     BACKGROUND.

         The Company and Prudential are parties to the Amended and Restated Note
Agreement, dated as of January 31, 2001 (the "EXISTING NOTE AGREEMENT")
governing the terms of the following notes issued by the Company to Prudential:
(a) 8.30% Series A Senior Notes, due July 10, 2003 (the "EXISTING SERIES A
NOTES"), (b) 8.62% Series B Senior Notes, due July 10, 2005 (the "EXISTING
SERIES B NOTES") and (c) 8.81% Series C Senior Notes, due July 10, 2008 (the
"EXISTING SERIES C NOTES;" and together with the Existing Series A Notes and the
Existing Series B Notes, the "EXISTING NOTES"). The aggregate principal amount
of the Existing Series A Notes presently outstanding is $3,250,000; the
aggregate principal amount of the Existing Series B Notes presently outstanding
is $11,000,000 and the aggregate principal amount of the Existing Series C Notes
presently outstanding is $16,500,000. The Company has requested that Prudential
agree to amend and restate the Existing Note Agreement and the Existing Notes to
enable the Company to borrow money under the Credit Agreement, dated as of March
31, 2003 (the "CREDIT AGREEMENT") with J.P. Morgan Chase Bank, N.A. and the
other bank lenders party thereto. Prudential has, subject to the satisfaction of
the conditions precedent set forth in Section 3 of this Agreement, consented to
such request in consideration of a certain Amendment Fee, as described in
Section 3.5. The mutual

<PAGE>

agreement of the parties as to such matters is set forth in the amendment and
restatement of the Existing Note Agreement and the Existing Notes provided for
in this Agreement. The representations and warranties made by the Company under
and pursuant to the Existing Note Agreement shall survive the amendment and
restatement thereof under this Agreement.

         1.2.     AUTHORIZATION OF AMENDMENT AND RESTATEMENT.

         The Company hereby authorizes, agrees and consents to the amendment and
restatement in their entirety of the Existing Note Agreement and the Existing
Notes as provided for herein.

                  (a)      THE SERIES A NOTES. On the 2003 Note Closing Date,
         the Existing Series A Notes shall be deemed to be, automatically and
         without any further action, amended and restated in their entirety as
         set forth on Exhibit 1A; except that the date, registration number and
         principal amount set forth in each Existing Series A Note shall remain
         the same (each such Existing Series A Note, as so amended, and as
         hereinafter amended, restated or otherwise modified from time to time,
         shall be referred to herein individually as a "SERIES A NOTE" and,
         collectively, as the "SERIES A NOTES" and such terms shall further
         include any Series A Note issued in substitution or exchange for any
         such Note in accordance with the terms of this Agreement.

                  (b)      THE SERIES B NOTES. On the 2003 Note Closing Date,
         the Existing Series B Notes shall be deemed to be, automatically and
         without any further action, amended and restated in their entirety as
         set forth on Exhibit 1B; except that the date, registration number and
         principal amount set forth in each Existing Series B Note shall remain
         the same (each such Existing Series B Note, as so amended, and as
         hereinafter amended, restated or otherwise modified from time to time,
         shall be referred to herein individually as a "SERIES B NOTE" and,
         collectively, as the "SERIES B NOTES" and such terms shall further
         include any Series B Note issued in substitution or exchange for any
         such Note in accordance with the terms of this Agreement.

                  (c)      THE SERIES C NOTES. On the 2003 Note Closing Date,
         the Existing Series C Notes shall be deemed to be, automatically and
         without any further action, amended and restated in their entirety as
         set forth on Exhibit 1C; except that the date, registration number and
         principal amount set forth in each Existing Series C Note shall remain
         the same (each such Existing Series C Note, as so amended, and as
         hereinafter amended, restated or otherwise modified from time to time,
         shall be referred to herein individually as a "SERIES C NOTE" and,
         collectively, as the "SERIES C NOTES" and such terms shall further
         include any Series C Note issued in substitution or exchange for any
         such Note in accordance with the terms of this Agreement.

                                       2
<PAGE>

         1.3.     NOTES IN SERIES. The Series A Notes, the Series B Notes and
the Series C Notes (each a "SERIES") are herein sometimes collectively referred
to as the "NOTES" and individually referred to as a "NOTE."

2.       AUTHORIZATION OF AMENDMENT AND RESTATEMENT.

         Subject to the satisfaction of the conditions precedent set forth in
Section 3 of this Agreement, Prudential, by its execution of this Agreement,
hereby agrees and consents to the amendment and restatement in its entirety of
the Existing Note Agreement by this Agreement, and, upon the satisfaction of
such conditions precedent, the Existing Note Agreement shall be deemed so
amended and restated. Subject to the satisfaction of the conditions precedent
set forth in Section 3 of this Agreement, Prudential, by its execution of this
Agreement, hereby agrees and consents to the amendment and restatement in their
entirety of the Existing Notes, on the terms set forth in Section 1.2 (such
transactions are hereinafter referred to collectively as the "AMENDMENT AND
RESTATEMENT"). All amounts owing under and evidenced by the Existing Notes as of
the 2003 Note Closing Date shall continue to be outstanding under, and shall
after the 2003 Note Closing Date continue to be evidenced by, the Notes, and
shall be payable in accordance with this Agreement.

3.       CONDITIONS SUBSEQUENT TO EFFECTIVENESS.

         The Amendment and Restatement shall be effective upon the execution and
delivery of this Agreement by the parties hereto; provided, however, that the
effectiveness hereof is subject to the following conditions subsequent which, if
not met on or before the 2003 Note Closing Date, will automatically and
immediately (i) render this Agreement ineffective, and (ii) render the Existing
Note Agreement effective, in each case without any further action on the part of
any Person, as if this Agreement had never existed:

         3.1.     CERTAIN DOCUMENTS. Prudential shall have received the
following:

                  (a)      Certified copies of the resolutions of the Board of
         Directors of the Company authorizing the amendment and restatement of
         the Existing Note Agreement and the Existing Notes, and the execution
         and delivery of this Agreement, the Guarantee and Collateral Agreement
         and the New Mortgage and all documents evidencing other necessary
         corporate action and governmental approvals, if any, with respect to
         such agreements and instruments.

                  (b)      Certified copies of the resolutions of the Board of
         Directors or its equivalent of each of Big O, Tire Kingdom, Big O Tire
         of Idaho, Inc., Carroll's, Inc., Big O Development, Inc., Big O Retail
         Enterprises, Inc., Northern States Tire, Inc., O Advertising, Inc., TBC
         International Inc., TBC Retail

                                       3
<PAGE>

         Enterprises, Inc., TBC Brands, LLC, TBC Capital, LLC, Merchant's,
         Incorporated and Merban, Inc. (the "ORIGINAL SUBSIDIARY OBLIGORS")
         authorizing the execution and delivery of the Guarantee and Collateral
         Agreement and all documents evidencing other necessary action and
         governmental approvals, if any, with respect to such documents.

                  (c)      A certificate of the Secretary or an Assistant
         Secretary and one other officer of each of the Company and the Original
         Subsidiary Obligors certifying the names and true signatures of the
         officers of the Company and each Original Subsidiary Obligor, as the
         case may be, authorized to execute the Financing Documents to which it
         is a party and the other documents to be delivered by it hereunder.

                  (d)      Certified copies of the Certificate of Incorporation
         and By-laws of each of the Company and the Original Subsidiary
         Obligors.

                  (e)      A favorable opinion of Thompson Hine LLP, counsel to
         the Company, in form and substance satisfactory to Prudential. The
         Company hereby directs such counsel to deliver such opinion and
         understands and agrees that Prudential will and is hereby authorized to
         rely on such opinion.

                  (f)      A favorable opinion of Bingham McCutchen LLP, special
         counsel to Prudential, in form and substance satisfactory to
         Prudential.

                  (g)      A good standing certificate for each of the Company
         and the Original Subsidiary Obligors from the Secretary of State of its
         state of organization dated of a recent date and such other evidence of
         the status of the Company and each Subsidiary Obligor as Prudential may
         reasonably request.

                  (h)      Additional documents or certificates with respect to
         legal matters or corporate or other proceedings related to the
         transactions contemplated hereby as may be reasonably requested by
         Prudential.

         3.2.     COMPANY REPRESENTATIONS AND WARRANTIES; NO DEFAULT; ETC. The
representations and warranties contained in Section 8 and in the Guarantee and
Collateral Agreement shall be true on and as of the 2003 Note Closing Date.
There shall exist on the 2003 Note Closing Date no Event of Default or Default
(after giving effect to this Agreement); and the Company shall have delivered to
Prudential an Officer's Certificate, dated the 2003 Note Closing Date, to both
such effects.

         3.3.     SUBSIDIARY REPRESENTATIONS AND WARRANTIES; NO DEFAULTS. The
representations and warranties in the Guarantee and Collateral Agreement made by
each Subsidiary party thereto shall be true on and as of the 2003 Note Closing

                                       4
<PAGE>

Date.

         3.4.     TRANSACTIONS PERMITTED BY APPLICABLE LAWS. On the 2003 Note
Closing Date, the Amendment and Restatement and the execution, delivery and
performance of the Guarantee and Collateral Agreement, all on the terms and
conditions herein and therein provided, shall (i) not violate any applicable law
or regulation (including, without limitation, Section 5 of the Securities Act,
Regulation T, U or X of the Board of Governors of the Federal Reserve System)
and (ii) not subject Prudential to any tax, penalty, liability or other onerous
condition under or pursuant to any applicable law or regulation. Prudential
shall have received such certificates or other evidence as it may request to
establish compliance with this Section.

         3.5.     PAYMENT OF AMENDMENT FEE. The Company shall have paid to
Prudential, as consideration for Prudential's consent to the Amendment and
Restatement, a fee (the "AMENDMENT FEE") equal to $38,080.49. The Amendment Fee
shall have been paid in immediately available funds to the account of Prudential
as specified in the Purchaser Schedule.

         3.6.     INTERCREDITOR AGREEMENT. Prudential and each lending
institution party to the Credit Agreement shall have executed and delivered (in
each capacity in which it is a party to the Credit Agreement) an intercreditor
agreement (the "INTERCREDITOR Agreement") in the form of Exhibit 3.6 hereto.

         3.7.     CREDIT AGREEMENT. The Credit Agreement shall have been
executed and delivered by all parties thereto, and the Company shall have
delivered to Prudential a copy of the executed Credit Agreement, together with
an Officer's Certificate certifying that such copy is true, correct and
complete.

         3.8.     GUARANTEE AND COLLATERAL AGREEMENT. Prudential shall have
received an originally executed counterpart of the Guarantee and Collateral
Agreement, dated as of the date hereof, together with all schedules and exhibits
thereto, entered into by the Company and the Original Subsidiary Obligors, in
the form attached hereto as Exhibit 3.8 (the "GUARANTEE AND COLLATERAL
AGREEMENT").

         3.9.     NEW MORTGAGE. Prudential shall have received a copy of the
originally executed New Mortgage, in the form attached hereto as Exhibit 3.9.

         3.10.    EVIDENCE OF FILING AND RECORDING, ETC. Prudential shall have
received evidence satisfactory to it that all UCC-1 Financing Statements have
been properly filed in each jurisdiction or location where such filing or
recording is appropriate in the reasonable judgment of Prudential and its
special counsel, and that such filings are sufficient to perfect a valid, first
priority Lien (subject in each case to any Liens permitted by Section 6.3) in
the collateral to which they relate.

                                       5
<PAGE>

         3.11.    TERMINATION OF EXISTING CREDIT AGREEMENT.

         Prudential shall have received evidence satisfactory to it that the
Existing Credit Agreement has been terminated and that the indebtedness incurred
by the Company and its Subsidiaries under and pursuant thereto has been
satisfied in full.

         3.12.    COPIES OF ENVIRONMENTAL AUDITS.

         Prudential's special counsel shall have received, on behalf of the
Prudential, (i) copies of all existing environmental audits with respect to the
real properties which are part of the Merchant's Acquisition and any other
Person the acquisition of which is to be financed with proceeds from the sale of
the Notes and (ii) any other existing environmental audits requested by
Prudential.

         3.13.    CLEAR LIEN SEARCH REPORT.

         Prudential's special counsel shall have received, on behalf of the
Prudential, the results of a recent Lien search in each of the jurisdictions
where assets of the Company and each Subsidiary (including Merchant's,
Incorporated and Merban, Inc.) are located, and such search shall reveal no
Liens on any of the assets of the Company or any Subsidiary except for Liens
permitted by Section 6.3 or discharged on or prior to the 2003 Note Closing Date
pursuant to documentation satisfactory to Prudential.

         3.14.    RECEIPT BY COLLATERAL AGENT OF PLEDGED STOCK AND NOTES.

         Prudential shall have received evidence reasonably satisfactory to it
that the Collateral Agent has received (i) the certificates representing the
shares of Capital Stock pledged pursuant to the Guarantee and Collateral
Agreement, together with an undated stock power for each such certificate
executed in blank by a duly authorized officer of the pledgor thereof, and (ii)
each promissory note (if any) pledged to the Collateral Agent pursuant to the
Guarantee and Collateral Agreement endorsed (without recourse) in blank (or
accompanied by an executed transfer form in blank) by the pledgor thereof.

         3.15.    CONSUMMATION OF ACQUISITION OF MERCHANT'S, INCORPORATED.

         The Merchant's Acquisition shall have been consummated on the terms and
conditions set forth in the Merchant's Acquisition Documentation.

         3.16.    EXPENSES. All fees and disbursements required to be paid
pursuant to Section 11.2 hereof shall have been paid in full.

         3.17.    PROCEEDINGS SATISFACTORY. All proceedings taken in connection
with the Amendment and Restatement and all documents and papers relating thereto
shall be satisfactory to Prudential and its special counsel. Prudential and its

                                       6
<PAGE>

special counsel shall have received copies of such documents and papers as it or
they may reasonably request in connection therewith, all in form and substance
satisfactory to Prudential and its special counsel.

4.       PREPAYMENTS.

         The Notes shall be subject to required prepayment as and to the extent
provided in Section 4.1. The Notes shall also be subject to prepayment under the
circumstances set forth in Section 4.2, Section 4.7 and Section 4.8; provided,
however, that any such prepayment shall not reduce or otherwise affect the
Company's obligation to make any required prepayment as specified in Section
4.1.

         4.1.     REQUIRED PREPAYMENTS OF SERIES B AND SERIES C NOTES.
                  SERIES B NOTES.

                  The Company shall apply to the prepayment of the Series B
         Notes, without Yield-Maintenance Amount, the sum of $2,750,000 on
         January 10, 2004, July 10, 2004 and January 10, 2005, and such
         principal amount of the Series B Notes, together with interest thereon
         to the payment dates, shall become due on such payment dates. The
         remaining unpaid principal amount of the Series B Notes, together with
         interest accrued thereon, shall become due on the maturity date of the
         Series B Notes.

                  (b)      SERIES C NOTES.

                  The Company shall apply to the prepayment of the Series C
         Notes, without Yield-Maintenance Amount, the sum of $2,750,000 on
         January 10 and July 10 in each of the years 2006 and 2007, and on
         January 10, 2008, and such principal amount of the Series C Notes,
         together with interest thereon to such payment dates, shall become due
         on such payment dates. The remaining unpaid principal amount of the
         Series C Notes, together with interest accrued thereon, shall become
         due on the maturity date of the Series C Notes.

         4.2.     OPTIONAL PREPAYMENT WITH YIELD-MAINTENANCE AMOUNT. The Notes
shall be subject to prepayment, in whole at any time or from time to time in
part (in integral multiples of $100,000 and in a minimum amount of $1,000,000),
at the option of the Company, at 100% of the principal amount so prepaid plus
interest thereon to the prepayment date and the Yield-Maintenance Amount, if
any, with respect to each such Note. Any partial prepayment of the Notes
pursuant to this Section 4.2 shall be applied in satisfaction of required
payments of principal in inverse order of their scheduled due dates.

         4.3.     NOTICE OF OPTIONAL PREPAYMENT. The Company shall give the
holder of each Note to be prepaid pursuant to Section 4.2 irrevocable written
notice

                                       7
<PAGE>

of such prepayment not less than 10 Business Days prior to the prepayment
date, specifying such prepayment date, the aggregate principal amount of the
Notes to be prepaid on such date, the principal amount of the Notes held by such
holder to be prepaid on that date and that such prepayment is to be made
pursuant to Section 4.2. Notice of prepayment having been given as aforesaid,
the principal amount of the Notes specified in such notice, together with
interest thereon to the prepayment date and together with the Yield-Maintenance
Amount, if any, herein provided, shall become due and payable on such prepayment
date. The Company shall, on or before the day on which it gives written notice
of any prepayment pursuant to Section 4.2, give telephonic notice of the
principal amount of the Notes to be prepaid and the prepayment date to each
Significant Holder which shall have designated a recipient for such notices in
the Purchaser Schedule attached hereto.

         4.4.     APPLICATION OF REQUIRED PREPAYMENTS. In the case of each
prepayment of less than the entire unpaid principal amount of all outstanding
Series B Notes or Series C Notes pursuant to Section 4.1, the amount to be
prepaid shall be applied pro rata to all outstanding Series B Notes or Series C
Notes, as the case may be (including, for the purpose of this Section 4.4 only,
all such Notes prepaid or otherwise retired or purchased or otherwise acquired
by the Company or any of its Subsidiaries or Affiliates other than by prepayment
pursuant to Section 4.1 or 4.2) according to the respective unpaid principal
amounts thereof.

         4.5.     APPLICATION OF OPTIONAL PREPAYMENTS. In the case of each
prepayment pursuant to Section 4.2 of less than the entire unpaid principal
amount of all outstanding Notes, the amount to be prepaid shall be applied pro
rata to all outstanding Notes of all Series (including, for the purpose of this
Section 4.5 only, all Notes prepaid or otherwise retired or purchased or
otherwise acquired by the Company or any of its Subsidiaries or Affiliates other
than by prepayment pursuant to Section 4.1 or 4.2) according to the respective
unpaid principal amounts thereof.

         4.6.     NO ACQUISITION OF NOTES. The Company shall not, and shall not
permit any of its Subsidiaries or Affiliates to, prepay or otherwise retire in
whole or in part prior to their stated final maturity (other than by prepayment
pursuant to Section 4.1 or 4.2 or upon acceleration of such final maturity
pursuant to Section 7.1), or purchase or otherwise acquire, directly or
indirectly, Notes held by any holder.

         4.7.     CHANGE IN CONTROL PREPAYMENT.

                  (a)      NOTICE OF CHANGE IN CONTROL OR CONTROL EVENT. The
         Company will, within three Business Days after any Responsible Officer
         has knowledge of the occurrence of any Change in Control or Control
         Event, give written notice of such Change in Control or Control Event
         (including a description of the terms thereof in sufficient detail to
         enable a holder of Notes to evaluate the merits thereof) to each holder
         of Notes unless notice in respect

                                       8
<PAGE>

         of such Change in Control (or the Change in Control contemplated by
         such Control Event) shall have been given pursuant to Section 4.7(b).
         If a Change in Control has occurred, such notice shall contain and
         constitute an offer to prepay Notes as described in Section 4.7(c) and
         shall be accompanied by the certificate described in Section 4.7(g).

                  (b)      CONDITION TO COMPANY ACTION. The Company will not
         take any action that consummates or finalizes a Change in Control
         unless

                           (i)      at least 30 days prior to such action it
                  shall have given to each holder of Notes written notice
                  (including a description of the terms of such Change in
                  Control in sufficient detail to enable a holder of Notes to
                  evaluate the merits thereof) containing and constituting an
                  offer to prepay Notes as described in Section 4.7(c),
                  accompanied by the certificate described in Section 4.7(g),
                  and

                           (ii)     contemporaneously with consummating or
                  finalizing the Change in Control, it prepays all Notes
                  required to be prepaid in accordance with this Section 4.7.

                  (c)      OFFER TO PREPAY NOTES. The offer to prepay Notes
         contemplated by Section 4.7(a) and Section 4.7(b) shall be an offer to
         prepay, in accordance with and subject to this Section 4.7, all, but
         not less than all, the Notes held by each holder (in this case only,
         "holder" in respect of any Note registered in the name of a nominee for
         a disclosed beneficial owner shall mean such beneficial owner) on a
         date specified in such offer (the "PROPOSED PREPAYMENT DATE"). If such
         Proposed Prepayment Date is in connection with an offer contemplated by
         Section 4.7(a), such date shall be not less than 30 days and not more
         than 60 days after the date of such offer (if the Proposed Prepayment
         Date shall not be specified in such offer, the Proposed Prepayment Date
         shall be the 30th day after the date of such offer).

                  (d)      ACCEPTANCE. A holder of Notes may accept the offer to
         prepay made pursuant to this Section 4.7 by causing a notice of such
         acceptance to be delivered to the Company at least 5 days prior to the
         Proposed Prepayment Date. A failure by a holder of Notes to respond to
         an offer to prepay made pursuant to this Section 4.7 shall be deemed to
         constitute an acceptance of such offer by such holder.

                  (e)      PREPAYMENT.

                           (i)      If no Default or Event of Default exists and
                  is continuing on the date prepayment is made pursuant to this
                  Section 4.7, prepayment of the Notes to be prepaid pursuant to
                  this Section 4.7 shall be at 100% of the principal amount of
                  such Notes, together with

                                       9

<PAGE>

                  interest on such Notes accrued to the date of prepayment.

                           (ii)     If a Default or Event of Default exists and
                  is continuing on the date prepayment is made under this
                  Section 4.7, prepayment of the Notes to be prepaid under this
                  Section 4.7 shall be at 100% of the principal amount of such
                  Notes, plus the Yield-Maintenance Amount determined for the
                  date of prepayment with respect to such principal amount,
                  together with interest on such Notes accrued to the date of
                  prepayment. On the Business Day preceding the date of
                  prepayment in accordance with this Section 4.7(e)(ii), the
                  Company shall deliver to each holder of Notes being prepaid a
                  statement showing the Yield-Maintenance Amount due in
                  connection with such prepayment and setting forth the details
                  of the computation of such amount.

         Prepayment shall be made on the Proposed Prepayment Date except as
         provided in Section 4.7(f).

                  (f)      DEFERRAL OF OBLIGATION TO PURCHASE. The obligation of
         the Company to prepay Notes pursuant to the offers accepted in
         accordance with Section 4.7(d) is subject to the occurrence of the
         Change in Control in respect of which such offers and acceptances shall
         have been made. In the event that such Change in Control does not occur
         on or before the Proposed Prepayment Date in respect thereof, the
         prepayment shall be deferred until and shall be made on the date on
         which such Change in Control occurs. The Company shall keep each holder
         of Notes reasonably and timely informed of

                           (i)      any such deferral of the date of prepayment,

                           (ii)     the date on which such Change in Control and
                  the prepayment are expected to occur, and

                           (iii)    any determination by the Company that
                  efforts to effect such Change in Control have ceased or been
                  abandoned (in which case the offers and acceptances made
                  pursuant to this Section 4.7 in respect of such Change in
                  Control shall be deemed rescinded).

         Notwithstanding the foregoing, in the event that any Change in Control
         does not occur within ninety (90) days of the Proposed Prepayment Date
         in respect thereof, any holder of Notes may, upon written notice to the
         Company, rescind its acceptance of an offer made pursuant to this
         Section 4.7 in respect of such Change in Control.

                  (g)      OFFICER'S CERTIFICATE. Each offer to prepay the Notes
         pursuant to this Section 4.7 shall be accompanied by a certificate,
         executed by a

                                       10
<PAGE>

         Responsible Officer of the Company and dated the date of such offer,
         specifying:

                           (i)      the Proposed Prepayment Date;

                           (ii)     that such offer is made pursuant to this
                  Section 4.7;

                           (iii)    the principal amount of each Note offered to
                  be prepaid;

                           (iv)     the last date upon which the offer can be
                  accepted or rejected, and setting forth the consequences of
                  failing to provide an acceptance or rejection, as provided in
                  Section 4.7(d);

                           (v)      whether a Default or Event of Default exists
                  and is continuing, or is expected to exist and be continuing
                  on the Proposed Prepayment Date, and the nature and duration
                  of any such existing or projected Default or Event of Default
                  together with calculations (if applicable) in reasonable
                  detail used in determining that such Default or Event of
                  Default exists or is projected to exist;

                           (vi)     if a Default or Event of Default is
                  projected to exist and be continuing on the Proposed
                  Prepayment Date, the estimated Yield-Maintenance Amount, if
                  any, due in connection with such prepayment (calculated as if
                  the date of such notice were the date of the prepayment),
                  setting forth the details of such computation;

                           (vii)    the interest that would be due on each Note
                  offered to be prepaid, accrued to the Proposed Prepayment
                  Date;

                           (viii)   that the conditions of this Section 4.7 have
                  been fulfilled; and

                           (ix)     in reasonable detail, the nature and date or
                  proposed date of the Change in Control.

         The amount of each payment of the principal of the Notes made pursuant
         to this Section 4.7 shall be applied against and reduce each of the
         then remaining principal payments due pursuant to Section 4.7 by a
         percentage equal to the aggregate principal amount of the Notes so paid
         divided by the aggregate principal amount of the Notes outstanding
         immediately prior to such payment.

         4.8.     PREPAYMENT OF NOTES PURSUANT TO DEBT PREPAYMENT APPLICATION.

                                       11

<PAGE>

                  (a)      ASSET SALE PROCEEDS NOTICE. In the event that and on
         each occasion on which any Net Proceeds are received by or on behalf of
         the Company or any Subsidiary in respect of any Prepayment Event, the
         Company shall, within three Business Days after such Net Proceeds are
         received, deliver a written notice (each, an "ASSET SALE PROCEEDS
         NOTICE") to each holder of Notes (i) stating the aggregate amount of
         Net Proceeds received by the Company or such Subsidiary and the portion
         of each Note being offered to be prepaid (determined pursuant to clause
         (c)(i) below), (ii) specifying a date, not less than 10 days and not
         more than 20 days from the date of such notice (the "PROCEEDS
         DISPOSITION DATE") on which such Net Proceeds are to be applied to the
         payment of Indebtedness, (iii) containing a brief description in
         reasonable detail of the transaction from which such Net Proceeds were
         derived, and (iv) containing an offer to prepay the Notes in accordance
         with clause (c)(ii) below (each, a "PREPAYMENT OFFER").

                  (b)      ACCEPTANCE OF PREPAYMENT OFFER. Each holder of a Note
         shall promptly notify the Company of such holder's acceptance or
         rejection of any Prepayment Offer; provided, however, that any such
         holder shall be deemed to have accepted such Prepayment Offer if it
         fails to so notify the Company prior to the disposition of Net Proceeds
         on the Proceeds Disposition Date in respect of such Prepayment Offer.

                  (c)      PREPAYMENT.

                           (i)      Such Asset Sale Proceeds Notice having been
                  so given, the Company shall prepay the principal of the Notes
                  and the 2003 Notes as to which acceptances (or deemed
                  acceptances) of prepayment offers have been received
                  (collectively, the "ACCEPTED NOTES"), together with the Bank
                  Term Loans, on the Proceeds Disposition Date in an aggregate
                  amount equal to such Net Proceeds (or such portion of such Net
                  Proceeds as shall equal the aggregate principal amount of all
                  Accepted Notes and Bank Term Loans, if the amount of such Net
                  Proceeds is greater than such aggregate principal amount). The
                  amount to be applied to such prepayment shall be applied (x)
                  to each Bank Term Loan and the Accepted Notes, pro rata in the
                  same proportions as the then balance of each Bank Term Loan
                  and Accepted Note bears to the total balance of all Bank Term
                  Loans plus the Accepted Notes and (xx) with respect to each,
                  to the latest maturing installments thereof.

                           (ii)     (A) If no Default or Event of Default exists
                  and is continuing on the date prepayment is made pursuant to
                  this Section 4.8, prepayment of the Notes to be prepaid
                  pursuant to this Section 4.8 shall be at 100% of the principal
                  amount of such Notes, together with interest on such Notes
                  accrued to the date of prepayment.

                                       12
<PAGE>

                                    (B) If a Default or Event of Default exists
                  and is continuing on the date prepayment is made under this
                  Section 4.8, prepayment of the Notes to be prepaid under this
                  Section 4.8 shall be at 100% of the principal amount of such
                  Notes, plus the Yield-Maintenance Amount determined for the
                  date of prepayment with respect to such principal amount,
                  together with interest on such Notes accrued to the date of
                  prepayment. On the Business Day preceding the date of
                  prepayment, the Company shall deliver to each holder of Notes
                  being prepaid a statement showing the Yield-Maintenance Amount
                  due in connection with such prepayment and setting forth the
                  details of the computation of such amount.

5.       AFFIRMATIVE COVENANTS.

         The Company covenants that on and after the date hereof and so long as
any of the Notes shall be outstanding:

         5.1.     FINANCIAL STATEMENTS; NOTICE OF DEFAULTS. The Company
covenants that it will deliver to each holder of any Notes in duplicate:

                  (a)      as soon as practicable and in any event within 45
         days after the end of each Fiscal Quarter (other than the Fiscal
         Quarter ending in December), consolidating and consolidated statements
         of income and cash flows and a consolidated statement of shareholders'
         equity of the Company and its Subsidiaries for the period from the
         beginning of the current Fiscal Year to the end of such Fiscal Quarter,
         and a consolidating and consolidated balance sheet of the Company and
         its Subsidiaries as at the end of such Fiscal Quarter, setting forth in
         each case in comparative form figures for the corresponding period in
         the preceding fiscal year, all in reasonable detail and certified by an
         authorized financial officer of the Company, subject to changes
         resulting from year-end adjustments; provided, however, that delivery
         pursuant to clause (c) below of copies of the Quarterly Report on Form
         10-Q of the Company for such quarterly period filed with the Securities
         and Exchange Commission shall be deemed to satisfy the requirements of
         this clause (a) with respect to consolidated statements;

                  (b)      as soon as practicable and in any event within 90
         days after the end of each Fiscal Year, consolidating and consolidated
         statements of income and cash flows and a consolidated statement of
         shareholders' equity of the Company and its Subsidiaries for such year,
         and a consolidating and consolidated balance sheet of the Company and
         its Subsidiaries as at the end of such year, setting forth in each case
         in comparative form corresponding consolidated figures from the
         preceding annual audit, all in reasonable detail and satisfactory in
         form to the Required Holder(s) and, as to the consolidated

                                       13
<PAGE>

         statements, reported on by independent public accountants of recognized
         national standing selected by the Company whose report shall be without
         limitation as to scope of the audit and satisfactory in substance to
         the Required Holder(s) and, as to the consolidating statements,
         certified by an authorized financial officer of the Company; provided,
         however, that delivery pursuant to clause (c) below of copies of the
         Annual Report on Form 10-K of the Company for such Fiscal Year filed
         with the Securities and Exchange Commission shall be deemed to satisfy
         the requirements of this clause (b) with respect to consolidated
         statements;

                  (c)      promptly upon transmission thereof, copies of all
         such financial statements, proxy statements, notices and reports as it
         shall send to its public stockholders and copies of all registration
         statements (without exhibits) and all reports which it files with the
         Securities and Exchange Commission (or any governmental body or agency
         succeeding to the functions of the Securities and Exchange Commission);

                  (d)      promptly upon receipt thereof, a copy of each other
         report submitted to the Company or any Subsidiary by independent
         accountants in connection with any annual, interim or special audit
         made by them of the books of the Company or any Subsidiary; and

                  (e)      with reasonable promptness, such other financial data
         as such holder may reasonably request.

         Together with each delivery of financial statements required by clauses
(a) and (b) above, the Company will deliver to each holder of any Notes an
Officer's Certificate demonstrating (with computations in reasonable detail)
compliance by the Company and its Subsidiaries with the provisions of Sections
6.1(a) through (d) and stating (i) that there exists no Event of Default or
Default, or, if any Event of Default or Default exists, specifying the nature
and period of existence thereof and what action the Company proposes to take
with respect thereto, and (ii) whether any change in GAAP or in the application
thereof has occurred since the date of the audited financial statements referred
to in Section 8.2 and, if any such change has occurred, specifying the effect of
such change on the financial statements accompanying such Officer's Certificate.
Together with each delivery of financial statements required by clause (b)
above, the Company will deliver to each holder of any Notes a certificate of the
accountants referred to in such clause stating that, in making the audit
necessary for their report on such financial statements, they have obtained no
knowledge of any Event of Default or Default, or, if they have obtained
knowledge of any Event of Default or Default, specifying the nature and period
of existence thereof. Such accountants, however, shall not be liable to anyone
by reason of their failure to obtain knowledge of any Event of Default or
Default which would not be disclosed in the course of an audit conducted in
accordance with generally accepted auditing standards.

                                       14

<PAGE>

         5.2.     NOTICE OF CERTAIN MATERIAL EVENTS. The Company will furnish to
each holder of Notes written notice of the following as soon as practicable and
in any event no later than the Business Day immediately following any day on
which any Responsible Officer obtains knowledge thereof:

                  (a)      the existence of any Default or Event of Default;

                  (b)      the filing or commencement of any action, suit or
         proceeding by or before any arbitrator or Governmental Authority
         against or affecting the Company or any Subsidiary or Affiliate thereof
         that, if adversely determined, could reasonably be expected to result
         in a Material Adverse Effect; and

                  (c)      any other development that results in, or could
         reasonably be expected to result in, a Material Adverse Effect.

         Each notice delivered under this Section 5.2 shall be accompanied by an
Officer's Certificate setting forth the nature and period of existence of such
event or development and what action the Company has taken or proposes to take
with respect thereto.

         5.3.     ERISA NOTICES. In the event it or any Subsidiary has
participated, now participates or will participate in any Plan or Multiemployer
Plan, the Company covenants that it and any such Subsidiary will deliver to each
holder of any Note: (a) promptly and in any event within 10 days after it knows
or has reason to know of the occurrence of a reportable event (as defined in
section 4043(b) of ERISA and the regulations thereunder) with respect to a Plan,
a copy of any materials required to be filed with the PBGC with respect to such
reportable event, together with a statement of the chief financial officer of
the Company setting forth details as to such reportable event and the action
which the Company proposes to take with respect thereto; (b) at least 10 days
prior to the filing by any plan administrator of a Plan which is a defined
benefit plan subject to Title IV of ERISA of a notice of intent to terminate
such Plan, a copy of such notice; (c) promptly upon the reasonable request of a
Significant Holder, and in no event more than 10 days after such request, copies
of each annual report on Form 5500 that is filed with the Internal Revenue
Service, together with certified financial statements for the Plan (if any) as
of the end of such year and actuarial statements on Schedule B to such Form
5500; (d) promptly and in any event within 10 days after it knows or has reason
to know of any event or condition which might constitute grounds under section
4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan, a statement of the chief financial officer of the Company
describing such event or condition; (e) promptly and in no event more than 10
days after its or any ERISA Affiliate's receipt thereof, a copy of any notice
concerning the imposition of any withdrawal liability under section 4202 of
ERISA; and (f) promptly after receipt thereof, a copy of any notice the Company
or any ERISA Affiliate may receive from the PBGC or the Internal Revenue Service
with respect

                                       15
<PAGE>

to any Plan or Multiemployer Plan; provided, however, that this Section 5.3
shall not apply to notices of general application promulgated by the PBGC or the
Internal Revenue Service.

         5.4.     INFORMATION REQUIRED BY RULE 144A. The Company covenants that
it will, upon the request of the holder of any Note, provide such holder, and
any qualified institutional buyer designated by such holder, such financial and
other information as such holder may reasonably determine to be necessary in
order to permit compliance with the information requirements of Rule 144A under
the Securities Act in connection with the resale of Notes, except at such times
as the Company is subject to and in compliance with the reporting requirements
of section 13 or 15(d) of the Exchange Act. For the purpose of this Section 5.4,
the term "QUALIFIED INSTITUTIONAL BUYER" shall have the meaning specified in
Rule 144A under the Securities Act.

         5.5.     BOOKS AND RECORDS; INSPECTION OF PROPERTY. The Company will,
and will cause each of its Subsidiaries to, keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Company covenants
that it will permit any Person designated by any Significant Holder in writing,
at such Significant Holder's expense, to visit and inspect any of the properties
of the Company and its Subsidiaries, to examine the corporate books and
financial records of the Company and its Subsidiaries and make copies thereof or
extracts therefrom and to discuss the affairs, finances and accounts of any of
such corporations with the principal officers of the Company and its independent
public accountants, all at such reasonable times and as often as such
Significant Holder may reasonably request.

         5.6.     SUBSIDIARY GUARANTEES AND COLLATERAL.

                  (a)      With respect to any new Subsidiary (other than an
         Excluded Foreign Subsidiary) created or acquired after the date hereof
         by the Company or any Subsidiary (which, for the purposes of this
         clause (a), shall include any existing Subsidiary that ceases to be an
         Excluded Foreign Subsidiary), the Company will promptly (i) execute and
         deliver (or, if applicable, cause any Subsidiary to execute and
         deliver) to each holder of a Note such amendments to the Guarantee and
         Collateral Agreement as the Collateral Agent deems necessary or
         advisable to grant to the Collateral Agent, for the benefit of the
         holders of all Notes, a perfected first priority security interest in
         the Capital Stock of such new Subsidiary that is owned by the Company
         or any Subsidiary, (ii) deliver to the Collateral Agent the
         certificates representing such Capital Stock, together with undated
         stock powers, in blank, executed and delivered by a duly authorized
         officer of the Company or the relevant Subsidiary, (iii) cause such new
         Subsidiary (A) to become a party to the Guarantee and Collateral
         Agreement and (B) to take such actions as may be

                                       16
<PAGE>

         necessary or advisable to grant to the Collateral Agent for the benefit
         of the holders of all Notes a perfected first priority security
         interest in the collateral described in the Guarantee and Collateral
         Agreement with respect to such new Subsidiary, including the filing of
         Uniform Commercial Code financing statements in such jurisdictions as
         may be required by the Guarantee and Collateral Agreement or by law or
         as may be requested by the Collateral Agent, and (iv) if requested by
         the Collateral Agent, deliver to the holders of Notes legal opinions
         relating to the matters described above, which opinions shall be in
         form and substance, and from counsel, reasonably satisfactory to the
         Collateral Agent.

                  (b)      With respect to any new Excluded Foreign Subsidiary
         created or acquired after the date hereof by the Company or any
         Subsidiary (other than by any Subsidiary that is an Excluded Foreign
         Subsidiary), the Company will promptly (i) execute and deliver (or, if
         applicable, cause any Subsidiary to execute and deliver) to each holder
         of a Note such amendments to the Guarantee and Collateral Agreement as
         the Collateral Agent deems necessary or advisable to grant to the
         Collateral Agent, for the benefit of the holders of all Notes, a
         perfected first priority security interest in the Capital Stock of such
         new Subsidiary that is owned by the Company or such Subsidiary
         (provided that in no event shall more than 66% of the total outstanding
         voting Capital Stock of any such new Subsidiary be required to be so
         pledged), (ii) deliver to the Collateral Agent the certificates
         representing such Capital Stock, together with undated stock powers, in
         blank, executed and delivered by a duly authorized officer of the
         Company or the relevant Subsidiary, and take such other action as may
         be necessary or, in the opinion of the Collateral Agent, desirable to
         perfect the Collateral Agent's security interest therein, and (iii) if
         requested by the Collateral Agent, deliver to the Collateral Agent
         legal opinions relating to the matters described above, which opinions
         shall be in form and substance, and from counsel, reasonably
         satisfactory to the Collateral Agent.

         5.7.     ENVIRONMENTAL LAWS.

                  (a)      The Company will, and will cause each of its
         Subsidiaries to, comply in all material respects with, and ensure
         compliance in all material respects by all tenants and subtenants, if
         any, with, all applicable Environmental and Safety Laws, and obtain and
         comply in all material respects with and maintain, and ensure that all
         tenants and subtenants obtain and comply in all material respects with
         and maintain, any and all licenses, approvals, notifications,
         registrations or permits required by applicable Environmental and
         Safety Laws, except where the failure to do so, individually or in the
         aggregate, could not reasonably be expected to result in a Material
         Adverse Effect.

                                       17
<PAGE>

                  (b)      The Company will, and will cause each of its
         Subsidiaries to, conduct and complete all investigations, studies,
         sampling and testing, and all remedial, removal and other actions
         required under Environmental and Safety Laws and promptly comply in all
         material respects with all lawful orders and directives of all
         Governmental Authorities regarding Environmental and Safety Laws,
         except where the failure to do so, individually or in the aggregate,
         could not reasonably be expected to result in a Material Adverse
         Effect.

         5.8.     ADDITIONAL COLLATERAL, ETC.

                  (a)      With respect to any fee interest in any real property
         having a value (together with improvements thereof) of at least
         $10,000,000 acquired after the date hereof by the Company or any of its
         Subsidiaries (other than any such real property subject to a Lien
         expressly permitted by Section 6.3(d)), if requested by the Collateral
         Agent, the Company shall, or shall cause its Subsidiary to, promptly
         (i) execute and deliver a first priority mortgage, in favor of the
         Collateral Agent, for the benefit of the holders of all Notes, covering
         such real property, (ii) provide each holder of Notes with (x) title
         and extended coverage insurance covering such real property in an
         amount at least equal to the purchase price of such real property (or
         such other amount as shall be reasonably specified by the Collateral
         Agent) as well as a current ALTA survey thereof, together with a
         surveyor's certificate and (y) any consents or estoppels reasonably
         deemed necessary or advisable by the Collateral Agent in connection
         with such mortgage, each of the foregoing in form and substance
         reasonably satisfactory to the Collateral Agent and (iii) deliver to
         the Collateral Agent legal opinions relating to the matters described
         above, which opinions shall be in form and substance, and from counsel,
         reasonably satisfactory to the Collateral Agent.

                  (b)      With respect to any property acquired after the date
         hereof by any of the Company or its Subsidiaries (other than (x) any
         property described in Section 5.6(a), (y) any property subject to a
         Lien expressly permitted by Section 6.3(d) and (z) property acquired by
         any Excluded Foreign Subsidiary) as to which the Collateral Agent, for
         the benefit of the holders of Notes, does not have a perfected Lien, if
         requested by the Collateral Agent, the Company shall promptly (i)
         execute and deliver to each holder of a Note such amendments to the
         Guarantee and Collateral Agreement or such other documents as the
         Collateral Agent deems necessary or advisable to grant to the
         Collateral Agent, for the benefit of all holders of Notes, a security
         interest in such property and (ii) take all actions necessary or
         advisable to grant to the Collateral Agent, for the benefit of all
         holders of Notes, a perfected first priority security interest in such
         property, including the filing of Uniform Commercial Code financing
         statements in such jurisdictions as may be

                                       18
<PAGE>

         required by the Guarantee and Collateral Agreement or by law or as may
         be requested by the Collateral Agent.

         5.9.     TITLE INSURANCE, FLOOD INSURANCE, ETC.

                  (a)      If requested by the Collateral Agent, the Company
         will provide to the holders of Notes and the title insurance company
         issuing the policy referred to in Section 5.9(b) below (the "TITLE
         INSURANCE COMPANY") maps or plats of an as-built survey of the sites of
         the Additional Mortgaged Properties, and such maps or plats shall be
         certified to such holders and the Title Insurance Company in a manner
         satisfactory to the Collateral Agent, dated a date satisfactory to the
         Collateral Agent and the Title Insurance Company by an independent
         professional licensed land surveyor satisfactory to the Collateral
         Agent and the Title Insurance Company, which maps or plats and the
         surveys on which they are based shall be made in accordance with the
         Minimum Standard Detail Requirements for Land Title Surveys jointly
         established and adopted by the American Land Title Association and the
         American Congress on Surveying and Mapping in 1992, and, without
         limiting the generality of the foregoing, there shall be surveyed and
         shown on such maps, plats or surveys the following: (A) the locations
         on such sites of all the buildings, structures and other improvements
         and the established building setback lines; (B) the lines of streets
         abutting the sites and width thereof; (C) all access and other
         easements appurtenant to the sites; (D) all roadways, paths, driveways,
         easements, encroachments and overhanging projections and similar
         encumbrances affecting the site, whether recorded, apparent from a
         physical inspection of the sites or otherwise known to the surveyor;
         (E) any encroachments on any adjoining property by the building
         structures and improvements on the sites; (F) if the site is described
         as being on a filed map, a legend relating the survey to said map; and
         (G) the flood zone designations, if any, in which any Additional
         Mortgaged Property is located.

                  (b)      If requested by the Collateral Agent, the Company
         will provide to the holders of Notes in respect of each Additional
         Mortgaged Property a mortgagee's title insurance policy (or policies)
         or marked up unconditional binder for such insurance. Each such policy
         shall (A) be in an amount satisfactory to the Collateral Agent; (B) be
         issued at ordinary rates; (C) insure that the mortgage insured thereby
         creates a valid first Lien on such property free and clear of all
         defects and encumbrances, except as disclosed therein; (D) name the
         Collateral Agent for the benefit of all holders of Notes as the insured
         thereunder; (E) be in the form of ALTA Loan Policy - 1970 (Amended
         10/17/70 and 10/17/84) (or equivalent policies); (F) contain such
         endorsements and affirmative coverage as the Collateral Agent may
         reasonably request and (G) be issued by title companies satisfactory to
         the

                                       19
<PAGE>

         Collateral Agent (including any such title companies acting as
         co-insurers or reinsurers, at the option of the Collateral Agent). The
         Collateral Agent shall have received evidence satisfactory to it that
         all premiums in respect of each such policy, all charges for mortgage
         recording tax, and all related expenses, if any, have been paid.

                  (c)      If requested by the Collateral Agent, the Company
         will provide to the holders of Notes (A) a policy of flood insurance
         that (1) covers any parcel of improved real property that is encumbered
         by any mortgage in favor of the Collateral Agent for the benefit of the
         holders of Notes, (2) is written in an amount not less than the
         outstanding principal amount of the indebtedness secured by any such
         mortgage that is reasonably allocable to such real property or the
         maximum limit of coverage made available with respect to the particular
         type of property under the National Flood Insurance Act of 1968,
         whichever is less, and (3) has a term ending not later than the
         maturity of the Indebtedness secured by such mortgage and (B)
         confirmation that the Company has received the notice required pursuant
         to Section 208(e)(3) of Regulation H of the Board of Governors of the
         Federal Reserve System of the United States of America.

         5.10.    MAINTENANCE OF INSURANCE. The Company covenants that it and
each of its Subsidiaries will maintain, with responsible insurers, insurance
with respect to its properties and business against such casualties,
liabilities, risks, contingencies and hazards (including, but not limited to,
product liability, public liability and business interruption) and in such
amounts as is customary in the case of similarly situated corporations engaged
in the same or similar businesses and together with each delivery of financial
statements under clause (b) of Section 5.1, it will deliver an Officers'
Certificate specifying the details of such insurance in effect. Insurance
required by this Section 5.10 shall be with insurers rated A or better by A.M.
Best Company (or accorded a similar rating by another nationally or
internationally recognized insurance rating agency of similar standing if A.M.
Best Company is not then in the business of rating insurers or rating foreign
insurers) or such other insurers as may from time to time be reasonably
acceptable to the Required Holders.

         5.11.    MAINTENANCE OF PROPERTIES; COMPLIANCE WITH LAWS. The Company
covenants that it will, and will cause each of its Subsidiaries to, (a) (i)
maintain or cause to be maintained in good repair, working order and condition,
reasonable wear and tear excepted, all properties necessary at that time in its
business, and (ii) from time to time make or cause to be made all appropriate
repairs, renewals and replacements thereof; and (b) comply with all applicable
(i) laws (including Environmental and Safety Laws) rules, regulations, decrees
and orders of all federal, state, local or foreign courts or governmental
agencies, authorities, instrumentalities or regulatory bodies and (ii) rules,
regulations and

                                       20
<PAGE>

requirements necessary to maintain its operating and business licenses,
authorizations and permits, noncompliance with which could reasonably be
expected to result in a Material Adverse Effect.

         5.12.    CORPORATE EXISTENCE, ETC.; BUSINESS. The Company covenants
that it will, and will cause each of its Subsidiaries to, preserve and keep in
full force and effect at all times its corporate existence, and the permits,
licenses, franchises and other rights material to its business, provided that
the foregoing shall not prohibit any merger, consolidation, liquidation, or
dissolution permitted under Section 6.4. The Company covenants that it will not,
and will not permit any Subsidiary to, engage to any material extent in any
business not reasonably related to the distribution of tires and other products
in the automotive replacement market, providing financing to the Company and its
Subsidiaries, or owning and licensing intellectual property used by the Company
or its Subsidiaries.

         5.13.    PAYMENT OF TAXES AND CLAIMS. The Company covenants that it
will, and will cause each of its Subsidiaries to, pay (a) all taxes, assessments
and other governmental charges imposed upon it or any of its properties or
assets or in respect of any of its franchises, business, income or profits
before any penalty or interest accrues thereon, and (b) all claims (including,
without limitation, claims for labor, services, materials and supplies) for sums
that have become due and payable and (i) which by law have or might become a
Lien upon any of its properties or assets or (ii) where the failure to pay could
have a Material Adverse Effect; provided, that with respect to all of the above
no such charge or claim need be paid if subject to a Good Faith Contest.

         5.14.    USE OF PROCEEDS. No part of the proceeds of the sale of the
Notes will be used, directly or indirectly, for the purpose of buying or
carrying any margin stock within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System (12 CFR 221), or for the purpose of
buying or carrying or trading in any securities under such circumstances as to
involve the Company in a violation of Regulation X of said Board (12 CFR 224) or
to involve any broker or dealer in a violation of Regulation T of said Board (12
CFR 220).

         5.15.    INTERCOMPANY LOANS; PAYMENTS. The Company agrees with each
holder of Notes that (i) any payments made by a Subsidiary Obligor in reduction
of its obligation under the Guarantee and Collateral Agreement, shall reduce
dollar for dollar its total obligation to the Company for repayment of any
Intercompany Loans, (ii) it will require that any payments made by a Subsidiary
Obligor that is a direct Wholly-Owned Subsidiary of another Wholly-Owned
Subsidiary of the Company, in reduction of its obligation under the Guarantee
and Collateral Agreement, shall reduce dollar for dollar its total obligation
for repayment of any Intercompany Loans owed to its sole shareholder, (iii)
except as set forth in Schedule 5.15, it will not demand, enforce or accept any
payments on account of any Intercompany Loans owed to the Company by any
Subsidiary Obligor at a time

                                       21
<PAGE>

when such Subsidiary Obligor is insolvent or if such payments could reasonably
be expected to render such Subsidiary Obligor insolvent, to leave it with
unreasonably small capital for the business in which it is engaged and in which
it intends to engage, or to leave it unable to pay its other Indebtedness as the
same matures.

         5.16.    MAINTENANCE OF MOST FAVORED LENDER STATUS. The Company hereby
acknowledges and agrees that if the Company or any Subsidiary shall enter into
any amendment to the Credit Agreement which provides for the benefit of the
lenders thereunder any financial covenants or negative covenants which are more
favorable to such lenders than the covenants provided for in Section 6 hereof
for the benefit of the holders of the Notes then, and in each and any such
event, the covenants in this Agreement shall be and shall be deemed to be,
notwithstanding Section 11.3 and without any further action on the part of the
Company or any other Person being necessary or required, amended to afford the
holders of the Notes the same benefits and rights as such amendments provide
such lenders. The Company will promptly deliver to each holder of Notes a copy
of each such amendment, or any waiver or modification of the Credit Agreement,
entered into after the date hereof. Notwithstanding the foregoing, the Company
agrees to enter into such documentation as the Required Holders may reasonably
request to evidence the amendments provided for in this Section 5.16.

6.       NEGATIVE COVENANTS.

         The Company covenants that on and after the date hereof and so long as
any of the Notes shall be outstanding:

         6.1.     FINANCIAL COVENANTS. The Company will not at any time permit:

                  (a)      FIXED CHARGE COVERAGE RATIO. The Fixed Charge
         Coverage Ratio as of the last day of any Fiscal Quarter to be less than
         the amount set forth in the table below:

              ------------------------------------------------------------------
                    FISCAL QUARTER ENDING                              RATIO
              ------------------------------------------------------------------
              June 30, 2003, September 30, 2003,                    1.15 to 1.0
              December 31, 2003, March 31, 2004 and
              June 30, 2004
              ------------------------------------------------------------------
              September 30, 2004, December 31, 2004,                1.25 to 1.0
              March 31, 2005 and June 30, 2005
              ------------------------------------------------------------------
              September 30, 2005 and any                            1.50 to 1.0
              Fiscal Quarter ending thereafter
              ------------------------------------------------------------------

                  "FIXED CHARGE COVERAGE RATIO" shall mean, as of the last day
         of any Fiscal Quarter of the Company, the ratio of (a) EBITDA for the
         period of four completed Fiscal Quarters of the Company ending on the
         last day of such Fiscal Quarter to (b) Fixed Charges for such period.

                                       22
<PAGE>

                  (b)      MAXIMUM LEVERAGE RATIO.

                  The Leverage Ratio as of the end of any Fiscal Quarter to be
         greater than the amount set forth in the table below:

              ------------------------------------------------------------------
                    FISCAL QUARTER ENDING                              RATIO
              ------------------------------------------------------------------
              June 30, 2003, September 30, 2003 and                 3.25 to 1.0
              December 31, 2003

              ------------------------------------------------------------------
              March 31, 2004 and June 30, 2004                      3.00 to 1.0
              ------------------------------------------------------------------
              September 30, 2004 and December 31,
              2004                                                  2.75 to 1.0
              ------------------------------------------------------------------
              March 31, 2005, June 30, 2005, September 30,          2.50 to 1.0
              2005 and December 31, 2005
              ------------------------------------------------------------------
              March 31, 2006, and any Fiscal Quarter                2.25 to 1.0
              ending thereafter
              ------------------------------------------------------------------

         "LEVERAGE RATIO" at any time means the ratio of Consolidated Funded
         Indebtedness as of the end of the then most recent Fiscal Quarter to
         the aggregate EBITDA for the period of four Fiscal Quarters most
         recently ended, including any adjustments based on Acceptable
         Acquisitions and dispositions as provided in the definition of EBITDA.

                  (c)      ADJUSTED DEBT TO EBITDAR. The ratio of (i)
         Consolidated Adjusted Debt to (ii) EBITDAR at the end of any Fiscal
         Quarter, to be greater than the amount set forth in the following
         table:

              ------------------------------------------------------------------
                    FISCAL QUARTER ENDING                              RATIO
              ------------------------------------------------------------------
              June 30, 2003, September 30, 2003 and                 5.25 to 1.0
              December 31, 2003
              ------------------------------------------------------------------
              March 31, 2004, June 30, 2004, September 30,          5.00 to 1.0
              2004 and December 31, 2004
              ------------------------------------------------------------------
              March 31, 2005 and June 30, 2005                      4.75 to 1.0
              ------------------------------------------------------------------
              September 30, 2005, December 31, 2005,                4.50 to 1.0
              March 31, 2006 and June 30, 2006
              ------------------------------------------------------------------
              September 30, 2006, December 31, 2006,                4.25 to 1.0
              March 31, 2007 and June 30, 2007
              ------------------------------------------------------------------
              September 30, 2007, and any Fiscal                    4.00 to 1.0
              Quarter ending thereafter
              ------------------------------------------------------------------

         For purposes of this Section 6.1(c) "CONSOLIDATED ADJUSTED DEBT" shall
         mean, at the end of any Fiscal Quarter, Consolidated Funded
         Indebtedness as of the end of such Fiscal Quarter, plus eight times the
         rental payments made (net of any sublease income) by the Company and
         its Subsidiaries

                                       23

<PAGE>

         during the period of four completed Fiscal Quarters then most recently
         ended.

                  (d)      ASSET TEST. The ratio of the sum of consolidated
         accounts receivable and inventories subject to a first priority
         perfected security interest in favor of the Collateral Agent pursuant
         to the Guarantee and Collateral Agreement (and, in any event, exclusive
         of any then outstanding amounts secured by a security interest on
         inventory permitted by Section 6.3(f)) to Consolidated Funded
         Indebtedness as at the end of any Fiscal Quarter to be less than 1.35
         to 1.

         6.2.     LIMITATION ON INDEBTEDNESS. The Company will not, nor will it
permit any of its Subsidiaries to, create, incur, assume or permit to exist any
Indebtedness, except:

                  (a)      (i) Indebtedness created under this Agreement or
         under the 2003 Note Purchase Agreement and Guarantees executed pursuant
         to such agreements (including, without limitation, the Guarantee and
         Collateral Agreement), and (ii) Indebtedness and Guarantees under the
         Credit Agreement in an aggregate principal amount not exceeding
         $208,500,000; provided, however, that the amount of any increase in the
         aggregate revolving commitments under the Credit Agreement made in
         accordance with Section 2.02(d) thereof that increases the aggregate
         Indebtedness and Guarantees under the Credit Agreement to an amount
         greater than $208,500,000, but less than or equal to $258,500,000,
         shall be permitted;

                  (b)      Indebtedness and Guarantees existing on the date
         hereof and set forth on Schedule 6.2(b) and extensions, renewals and
         replacements of any such Indebtedness that do not increase the
         outstanding principal amount thereof over the amount set forth in
         respect of such Indebtedness on Schedule 6.2(b);

                  (c)      Indebtedness owed to the Company by any of its
         Wholly-Owned Subsidiaries, or owed to any of its Wholly-Owned
         Subsidiaries by any of its other Wholly-Owned Subsidiaries, that in
         each case is permitted under Section 6.5(c), and Indebtedness owed by
         the Company to any of its Wholly-Owed Subsidiaries;

                  (d)      Guarantees and Indebtedness arising in connection
         with (i) any Synthetic Lease, in an aggregate principal amount not
         exceeding $9,000,000 and (ii) the SunTrust Sale and Leaseback, in an
         aggregate principal amount not exceeding $12,000,000;

                  (e)      Guarantee obligations entered into by Big O or its
         Subsidiaries on behalf of its franchisees, other than Guarantees
         related to any Synthetic

                                       24
<PAGE>

         Lease, and those existing Guarantee obligations listed on Schedule
         6.2(e), provided that the aggregate principal amount of such guaranteed
         obligations arising after the date hereof plus the aggregate principal
         amount of loans permitted under Section 6.5(h) at no time exceeds
         $20,000,000;

                  (f)      Indebtedness of any Subsidiary which becomes such as
         a result of an Acceptable Acquisition, including such Indebtedness that
         is assumed or becomes the subject of a Guarantee, but not any
         extensions, renewals or replacements thereof; provided, that such
         Indebtedness is not created in contemplation of or in connection with
         such Acceptable Acquisition;

                  (g)      Guarantees by the Company or any of its Wholly-Owned
         Subsidiaries of Indebtedness of any of its other Wholly-Owned
         Subsidiaries, provided such Indebtedness is otherwise permitted
         pursuant to this Section 6.2;

                  (h)      Guarantee obligations entered into by (x) the Company
         or any of its Wholly-Owned Subsidiaries, of obligations of any of its
         other Wholly-Owned Subsidiaries to Persons other than their Affiliates,
         which obligations are incurred by them in the ordinary course of
         business and do not constitute Indebtedness, such as trade accounts
         payable, customer advances, accrued expenses and lease payments that do
         not constitute Indebtedness, and (y) the Company or any of its
         Wholly-Owned Subsidiaries, of obligations of Persons other than
         Subsidiaries and their Affiliates, provided that the aggregate
         principal amount of the guaranteed obligations under clause (y) plus
         the aggregate amount of the investments permitted under Section 6.5(d)
         at no time exceeds $20,000,000;

                  (i)      Indebtedness owed by the Company to the sellers of
         Merchant's, Incorporated and Merban, Inc. evidenced by the promissory
         note pursuant to Section 3.03(a)(i) of the Merchant's Acquisition
         Agreement; provided that such Indebtedness is paid in full at the
         closing of the sale of the 2003 Notes with the proceeds thereof; and

                  (j)      other Indebtedness not otherwise permitted by clauses
         (a) through (i) of this Section 6.2 in an aggregate principal amount
         not to exceed $25,000,000 at any time outstanding.

         6.3.     LIENS. The Company will not, nor will it permit any of its
Subsidiaries to, create, incur, assume or permit to exist any Lien on any
property or asset now owned or hereafter acquired by it or any of its
Subsidiaries, or assign or sell any income or revenues (including accounts
receivable) or rights in respect of any thereof, except:

                  (a)      Permitted Encumbrances;

                                       25
<PAGE>

                  (b)      any Lien on any property or asset of the Company or
         any Subsidiary existing on the date hereof and set forth on Schedule
         6.3; provided that, if such Lien is not released within sixty (60) days
         after the date hereof (i) such Lien shall not apply to any other
         property or asset of the Company or any Subsidiary and (ii) such Lien
         shall secure only those obligations which it secures on the date hereof
         and extensions, renewals and replacements thereof that do not increase
         the outstanding principal amount thereof over the amount set forth on
         Schedule 6.3;

                  (c)      any Lien, other than a Lien securing a Synthetic
         Lease permitted under Section 6.2(d), existing on any property or asset
         prior to the acquisition thereof by the Company or any Subsidiary or
         existing on any property or asset of any Person that becomes a
         Subsidiary after the date hereof prior to the time such Person becomes
         a Subsidiary; provided that (i) such Lien is not created in
         contemplation of or in connection with such acquisition or such Person
         becoming a Subsidiary, as the case may be, (ii) such Lien shall not
         apply to any other property or assets of the Company or any Subsidiary,
         (iii) such Lien secures Indebtedness permitted by Section 6.2(j) and
         (iv) such Lien shall secure only those obligations which it secures on
         the date of such acquisition or the date such Person becomes a
         Subsidiary, as the case may be;

                  (d)      Liens, other than Liens securing any Synthetic Lease
         permitted under Section 6.2(d), on fixed or capital assets acquired by
         the Company or any Subsidiary; provided that (i) such Liens secure
         Indebtedness permitted by Section 6.2(j), (ii) such Liens and the
         Indebtedness secured thereby are incurred prior to such acquisition or
         simultaneously therewith, (iii) the Indebtedness secured thereby does
         not exceed 100% of the cost of acquiring such fixed or capital assets,
         (iv) such security interests shall not apply to any other property or
         assets of the Company or any Subsidiary; and (v) the aggregate
         Indebtedness secured by all such Liens does not exceed $5,000,000;

                  (e)      Liens securing any Synthetic Lease or arising in
         connection with the SunTrust Sale and Leaseback, in each case so long
         as the Indebtedness secured thereby is permitted under Section 6.2(d);
         and

                  (f)      a security interest granted by Tire Kingdom to
         Michelin Tire Corporation, as secured party, with respect to all
         inventory previously and hereafter purchased from Michelin Tire
         Corporation by Tire Kingdom and all proceeds thereof, provided that the
         aggregate amount of obligations secured thereby at no time exceeds
         $30,000,000.

         6.4.     FUNDAMENTAL CHANGES. The Company will not, nor will it permit
any of its Subsidiaries to, merge or consolidate with or into any other Person,
or permit any other Person to merge into or with it or consolidate with it, or
sell,

                                       26
<PAGE>

transfer, lease or otherwise dispose of (in one transaction or in a series of
transactions) any of the stock of its Subsidiaries (in each case, whether now
owned or hereafter acquired), or liquidate or dissolve itself or any of its
Subsidiaries, except that, if at the time of any such event and immediately
after giving effect thereto no Default or Event of Default shall have occurred
and be continuing:

                  (a)      any Wholly-Owned Subsidiary may merge or consolidate
         with or into the Company or into another Wholly-Owned Subsidiary;

                  (b)      any Wholly-Owned Subsidiary may sell, transfer, lease
         or otherwise dispose of any portion of its assets to the Company or to
         another Wholly-Owned Subsidiary;

                  (c)      any Wholly-Owned Subsidiary may liquidate or dissolve
         if the Company determines in good faith that such liquidation or
         dissolution is in the best interests of the Company and is not
         materially disadvantageous to the holders of the Notes;

                  (d)      Acceptable Acquisitions shall be permitted; and

                  (e)      the disposal of all or any portion of the stock or
         assets of Northern States Tire, Inc., to any Person shall be permitted.

         6.5.     INVESTMENTS, LOANS, ADVANCES, GUARANTEES AND ACQUISITIONS. The
Company will not, nor will it permit any of its Subsidiaries to, purchase, hold
or acquire (including pursuant to any merger with any Person that was not a
Wholly-Owned Subsidiary prior to such merger) any capital stock, evidences of
Indebtedness or other securities (including any option, warrant or other right
to acquire any of the foregoing) of, or make or permit to exist any loans or
advances to, Guarantee any obligations of, or make or permit to exist any
investment or any other interest in, any other Person, or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other
Person constituting a business unit, except:

                  (a)      Permitted Investments;

                  (b)      (i) the Merchant's Acquisition, (ii) capital
         investments by the Company or any Subsidiary in any Subsidiary
         (provided that such latter Subsidiary is in existence on the date
         hereof or becomes a Subsidiary at any time after such date in a manner
         that complies with all other provisions of this Agreement, without
         giving effect to this clause (b)) and (iii) other existing investments
         and loans as otherwise described in Schedule 6.5(b);

                  (c)      loans or advances made by the Company or any
         Wholly-Owned Subsidiary to any of its other Wholly-Owned Subsidiaries;

                                       27

<PAGE>

                  (d)      loans and advances to, purchases of equity interests
         in and contributions to the capital of Joint Ventures and other Persons
         not otherwise permitted by this Section 6.5; provided that the
         aggregate amount of such investments, plus the aggregate amount of the
         obligations guaranteed pursuant to Section 6.2(h)(y), shall not exceed
         $20,000,000 at any one time (it being understood that profits and
         losses of Joint Ventures that are passed through to its equity holders
         shall not be included in the calculation of the aggregate amount of
         such investments);

                  (e)      investments in evidences of Indebtedness representing
         amounts formerly constituting accounts receivable owed to the Company
         or any Subsidiary in the ordinary course of business;

                  (f)      Guarantees permitted under Section 6.2;

                  (g)      Any separate individual Acquisition completed after
         the date of this Agreement which has been either (i) approved by the
         Board of Directors of the corporation, or the comparable or appropriate
         body of any other Person, which is the subject of such Acquisition or
         (ii) recommended by such Board to the shareholders of such corporation,
         or by such other body to the equity holders of such other Person, and
         in each case (A) the Acquisition target is a Person which is engaged in
         the replacement tire industry (B) the aggregate consideration for all
         such Acquisitions completed in any one calendar year does not exceed
         $40,000,000, (C) the aggregate consideration for all such Acquisitions
         completed after the date hereof does not exceed $75,000,000, provided,
         that this amount shall be increased on an annual basis by an amount
         equal to 25% of Consolidated Net Income for each completed Fiscal Year
         commencing with Fiscal Year 2003, and (D) such Acquisition is made
         under circumstances in which no Default or Event of Default either
         exists or will result therefrom, and in which pro forma financial
         statements and projections including the Company, its Subsidiaries and
         the Person and/or assets to be acquired, covering the most recent 12
         month period for which financial statements are available and the
         twelve months following the Acquisition, would show that no Default or
         Event of Default will result from the Acquisition (such an Acquisition
         is referred to herein as an "ACCEPTABLE ACQUISITION");

                  (h)      Intercompany Loans made to the Company or any
         Wholly-Owned Subsidiary by any of its Wholly-Owned Subsidiaries; and

                  (i)      loans by Big O or its Wholly-Owned Subsidiaries to
         Big O franchisees, provided that the aggregate principal amount of such
         loans arising after the date hereof plus the aggregate amount of the
         obligations guaranteed pursuant to Section 6.2(e) at no time exceeds
         $20,000,000. For purposes of this clause (i) investments in evidences
         of Indebtedness permitted

                                       28

<PAGE>

         under clause (e) of this Section 6.5 and Big O franchisee loans that
         have been sold to third parties shall be excluded from the loans and
         obligations required to be within the $20,000,000 limit.

         6.6.     HEDGING AGREEMENTS. The Company will not, nor will it permit
any of its Subsidiaries to, enter into any Hedging Agreement, other than Hedging
Agreements entered into in the ordinary course of business to hedge or mitigate
risks to which the Company or such Subsidiary is exposed in the conduct of its
business or the management of its liabilities.

         6.7.     TRANSACTIONS WITH AFFILIATES. The Company will not, nor will
it permit any of its Subsidiaries to, enter into any transaction (including,
without limitation, the purchase or sale of any property or service) with or
make any payment or transfer to, any of its Affiliates except in the ordinary
course of business and pursuant to the reasonable requirements of the Company's
or such Subsidiary's business and upon fair and reasonable terms no less
favorable to the Company or such Subsidiary than the Company or such Subsidiary
would obtain in a comparable arms-length transaction; provided that the
foregoing shall not apply to transactions (i) between the Company and any of its
Wholly-Owned Subsidiaries, as long as such transactions do not violate Section
6.5; or (ii) if such transactions occur in the ordinary course of business
consistent with past practices of the Company and/or Subsidiary, (A)
transactions between the Company or any Wholly-Owned Subsidiary and TBC de
Mexico, a Mexican variable capital corporation, or TBC Worldwide LLC, a Delaware
limited liability company or (B) transactions between Big O or any of its
Subsidiaries and any Joint Venture established by Big O or any of its
Subsidiaries in the ordinary course of business, the entire investment in which
is permitted under Section 6.5(d).

         6.8.     RESTRICTIVE AGREEMENTS. The Company will not, nor will it
permit any of its Subsidiaries to, directly or indirectly, enter into, incur or
permit to exist any agreement or other arrangement that prohibits, restricts, or
imposes any condition upon (a) the ability of the Company or any Subsidiary to
create, incur or permit to exist any Lien upon any of its property or assets or
(b) the ability of any Subsidiary to pay dividends or other distributions with
respect to any shares of its capital stock or to make or repay loans or advances
to the Company or any other Subsidiary or to Guarantee Indebtedness of the
Company or any Subsidiary; provided that (i) the foregoing shall not apply to
the restrictions and conditions imposed by law or by this Agreement, (ii) the
foregoing shall not apply to restrictions and conditions existing on the date
hereof identified on Schedule 6.8 (but shall apply to any extension or renewal
of, or any amendment or modification expanding the scope of, any such
restriction or condition), (iii) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the sale of a
Subsidiary pending such sale, provided such restrictions and conditions apply
only to the Subsidiary that is to be sold and such sale is permitted

                                       29
<PAGE>

hereunder, (iv) clause (a) of the foregoing shall not apply to restrictions or
conditions imposed by any agreement relating to secured Indebtedness permitted
by this Agreement if such restrictions or conditions apply only to the property
or assets securing such Indebtedness and (v) clause (a) of the foregoing shall
not apply to customary provisions in leases restricting the assignment thereof.

         6.9.     DISCLOSURE. None of the reports, financial statements,
certificates or other information furnished by or on behalf of the Company to
Prudential or any other holder of Notes pursuant to this Agreement or any other
Financing Document will, when so furnished, contain any material misstatement of
fact or omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they are made, not
misleading; provided that, with respect to projected financial information, such
information may be prepared in good faith based upon assumptions believed to be
reasonable at the time.

         6.10.    SALE OF ASSETS. The Company will not, and will not permit any
of its Subsidiaries to, sell, lease, assign, transfer or otherwise dispose of
any of its or their now owned or hereafter acquired assets (including, without
limitation, shares of stock and indebtedness of such Subsidiaries, receivables
and leasehold interests), other than:

                  (a)      inventory disposed of in the ordinary course of
         business;

                  (b)      transactions with Affiliates permitted under Section
         6.7;

                  (c)      the sale or other disposition of assets that are
         obsolete or no longer used or usable for the conduct of business in the
         ordinary course;

                  (d)      one or more transactions in which fixed or capital
         assets are sold and leased back on terms that do not constitute
         Capitalized Lease Obligations (other than the SunTrust Sale and
         Leaseback and any transaction described in clause (e) below) provided
         that (i) if the aggregate sale price of the assets sold exceeds
         $5,000,000, the Net Proceeds of each such sale are used to prepay
         principal of the Notes, the 2003 Notes and Bank Term Loans, in
         accordance with Section 4.8;

                  (e)      the sale by Big O and its Subsidiaries of (i) Big O
         franchisee loans to third parties, and (ii) Big O stores (including
         real estate, fixtures and equipment) to Big O franchisees and the sale
         and leaseback thereof for subleasing to Big O franchisees, provided
         that, in each case under the foregoing clauses (i) and (ii) the
         transaction is in the ordinary course of business and consistent with
         past practice;

                  (f)      sales described in Schedule 6.10; and

                                       30

<PAGE>

                  (g)      the SunTrust Sale and Leaseback.

         6.11.    RESTRICTED PAYMENTS. The Company will not, and will not permit
any of its Subsidiaries to, declare or make, or agree to pay or make, directly
or indirectly, any Restricted Payment, except (a) the Company may declare and
pay dividends with respect to its capital stock payable solely in additional
shares of its common stock, (b) Subsidiaries may declare and pay dividends
ratably with respect to their Capital Stock, (c) the Company may make Restricted
Payments pursuant to and in accordance with stock option plans or other benefits
for management or employees of the Company and its Subsidiaries and (d) so long
as no Default or Event of Default shall have occurred and be continuing or would
result therefrom, the Company may make payments in an aggregate amount not
exceeding $10,000,000 per calendar year on account of (i) the purchase,
redemption, retirement, acquisition, cancellation or termination of any shares
of capital stock of the Company or any option, warrant or other right to acquire
any such shares and (ii) the payment of dividends with respect to its preferred
stock.

7.       EVENTS OF DEFAULT.

         7.1.     ACCELERATION. If any of the following events shall occur and
be continuing for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law or
otherwise):

                  (a)      the Company defaults in the payment of any principal
         of, or Yield- Maintenance Amount payable with respect to, any Note when
         the same shall become due, either by the terms thereof or otherwise as
         herein provided; or

                  (b)      the Company defaults in the payment of any interest
         on any Note or any other amount payable under this Agreement (other
         than amounts referred to in clause (a) above) or any other Financing
         Document for more than three days after the date due; or

                  (c)      any representation or warranty made by the Company
         herein, or by the Company or any of its Subsidiaries in the Guarantee
         and Collateral Agreement, or by the Company or any of its Subsidiaries
         or any of their officers in any writing furnished in connection with or
         pursuant to this Agreement or any other Financing Document or any
         amendment or modification hereof or thereof, or waiver hereunder or
         thereunder, or in any report, certificate, financial statement or other
         document furnished pursuant to or in connection with this Agreement or
         any other Financing Document or any amendment or modification hereof or
         thereof or waiver hereunder or thereunder, shall prove to have been
         materially incorrect when made or deemed made; or

                                       31
<PAGE>

                  (d)      (i) the Company shall fail to observe or perform any
         covenant, condition or agreement contained in Sections 5.2, 5.3,
         5.11(b) or 5.12 (with respect to the Company's existence) or

                           (ii) the Company shall fail to observe or perform any
                  covenant or agreement contained in Section 6 and either (A)
                  such failure is not remedied within two Business Days after
                  any of the Chief Executive Officer of the Company or any
                  Responsible Officer obtains knowledge thereof or (B) within
                  such two-Business-Day period, any holder of Notes gives the
                  Company notice that such failure constitutes a Default; or

                  (e)      the Company fails to perform or observe any other
         agreement, term or condition contained herein and not specified in
         clauses (a), (b) or (d) above and such failure shall not be remedied
         within 30 days after the earliest to occur of (i) any Responsible
         Officer obtaining actual knowledge thereof or (ii) receipt of written
         notice thereof by the Company from any holder of Notes; or

                  (f)      the Company or any Subsidiary shall fail to make any
         payment (whether of principal or interest and regardless of amount) in
         respect of any Material Indebtedness, when and as the same shall become
         due and payable; or

                  (g)      any event or condition occurs that results in any
         Material Indebtedness becoming due prior to its scheduled maturity or
         that enables or permits (with or without the giving of notice, the
         lapse of time or both) the holder or holders of any Material
         Indebtedness or any trustee or agent on its or their behalf to cause
         any Material Indebtedness to become due, or to require the prepayment,
         repurchase, redemption or defeasance thereof, prior to its scheduled
         maturity; provided that this clause (g) shall not apply to secured
         Indebtedness that becomes due as a result of the voluntary sale or
         transfer of the property or assets securing such Indebtedness; or

                  (h)      the Company or any Subsidiary makes an assignment for
         the benefit of creditors or is generally not paying its debts as such
         debts become due; or

                  (i)      any decree or order for relief in respect of the
         Company or any Subsidiary is entered under any bankruptcy,
         reorganization, compromise, arrangement, insolvency, readjustment of
         debt, dissolution or liquidation or similar law, whether now or
         hereafter in effect (herein called the "BANKRUPTCY LAW"), of any
         jurisdiction; or

                                       32

<PAGE>
                  (j)      the Company or any Subsidiary petitions or applies to
         any tribunal for, or consents to, the appointment of, or taking
         possession by, a trustee, receiver, custodian, liquidator or similar
         official of the Company or any Subsidiary, or of any substantial part
         of the assets of the Company or any Subsidiary, or commences a
         voluntary case under the Bankruptcy Law of the United States or any
         proceedings (other than proceedings for the voluntary liquidation and
         dissolution of a Subsidiary) relating to the Company or any Subsidiary
         under the Bankruptcy Law of any other jurisdiction; or

                  (k)      any such petition or application is filed, or any
         such proceedings are commenced, against the Company or any Subsidiary
         and the Company or such Subsidiary by any act indicates its approval
         thereof, consent thereto or acquiescence therein, or an order, judgment
         or decree is entered appointing any such trustee, receiver, custodian,
         liquidator or similar official, or approving the petition in any such
         proceedings, and such order, judgment or decree remains unstayed and in
         effect for more than 60 days; or

                  (l)      any order, judgment or decree is entered in any
         proceedings against the Company decreeing the dissolution of the
         Company and such order, judgment or decree remains unstayed and in
         effect for more than 60 days: or

                  (m)      any order, judgment or decree is entered in any
         proceedings against the Company or any Subsidiary decreeing a split-up
         of the Company or such Subsidiary which requires the divestiture of
         assets representing a substantial part, or the divestiture of the stock
         of a Subsidiary whose assets represent a substantial part, of the
         consolidated assets of the Company and its Subsidiaries (determined in
         accordance with generally accepted accounting principles) or which
         requires the divestiture of assets, or stock of a Subsidiary, which
         shall have contributed a substantial part of the consolidated net
         income of the Company and its Subsidiaries (determined in accordance
         with generally accepted accounting principles) for any of the three
         fiscal years then most recently ended, and such order, judgment or
         decree remains unstayed and in effect for more than 60 days; or

                  (n)      one or more final judgments in an aggregate amount in
         excess of $3,000,000 is rendered against any one or more of the Company
         or any Subsidiary and, within 30 days after entry thereof, any such
         judgment is not discharged or execution thereof stayed pending appeal,
         or within 30 days after the expiration of any such stay, such judgment
         is not discharged; or

                  (o)      (i) the Company or any ERISA Affiliate, in its
         capacity as an employer under a Multiemployer Plan, makes a complete or
         partial withdrawal from such Multiemployer Plan resulting in the
         incurrence by

                                       33
<PAGE>

         such withdrawing employer of a withdrawal liability in an amount
         exceeding $2,000,000; (ii) any Plan shall fail to satisfy the minimum
         funding standards of ERISA or the Code for any plan year or part
         thereof or a waiver of such standards or extension of any amortization
         period is sought or granted under section 412 of the Code; (iii) a
         notice of intent to terminate any Plan shall have been or is reasonably
         expected to be filed with the PBGC or the PBGC shall have instituted
         proceedings under ERISA section 4042 to terminate or appoint a trustee
         to administer any Plan or the PBGC shall have notified the Company or
         any ERISA Affiliate that a Plan may become a subject of such
         proceedings; (iv) the aggregate "amount of unfunded benefit
         liabilities" (within the meaning of section 4001(a)(18) of ERISA) under
         all Plans, determined in accordance with Title IV of ERISA, shall
         exceed $2,000,000; (v) the Company or any ERISA Affiliate shall have
         incurred or is reasonably expected to incur any liability pursuant to
         Title I or IV of ERISA or the penalty or excise tax provisions of the
         Code relating to employee benefit plans; (vi) the Company or any ERISA
         Affiliate withdraws from any Multiemployer Plan; or (vii) the Company
         or any Subsidiary establishes or amends any employee welfare benefit
         plan that provides post-employment welfare benefits in a manner that
         would increase the liability of the Company or any Subsidiary
         thereunder; and any such event or events described in clauses (ii)
         through (vii) above, either individually or together with any other
         such event or events, could reasonably be expected to have a Material
         Adverse Effect; or

                  (p)      the Company or any Subsidiary shall be subject to or
         liable for any Environmental Costs and Liabilities or is the subject of
         any proceeding or investigation pertaining to the release by the
         Company or any Subsidiary, or any other Person of any Hazardous
         Material into the environment, or pertaining to any violation of any
         Environmental and Safety Law, which, in any case, could reasonably be
         expected to have a Material Adverse Effect; or

                  (q)      the Guarantee and Collateral Agreement, the New
         Mortgage, the Existing Mortgage or any mortgage in respect of
         Additional Mortgaged Property shall for any reason cease to be an
         enforceable obligation of the Company or the applicable Subsidiary (as
         the case may be) that executed same or if such party or any other
         Person should contest the validity of any such document or agreement or
         shall seek in any way to have such document or agreement declared null
         and void or to have such party's obligations thereunder in any way
         limited, or if such party shall in any respect fail to perform any of
         its obligations under such document or agreement, and such failure
         shall continue unremedied for a period of fifteen (15) days after the
         earliest to occur of (i) the date the Company shall have obtained
         knowledge thereof or (ii) written notice thereof from any holder of
         Notes or the Collateral Agent to the Company;

                                       34
<PAGE>

then (a) if such event is an Event of Default specified in clause (a) or clause
(b) of this Section 7.1, any holder of any Note may at its option during the
continuance of such Event of Default, by notice in writing to the Company,
declare all of the Notes held by such holder to be, and all of the Notes held by
such holder shall thereupon be and become, immediately due and payable at par
together with interest accrued thereon, without presentment, demand, protest or
notice of any kind, all of which are hereby waived by the Company, (b) if such
event is an Event of Default specified in clause (i), (j) or (k) of this Section
7.1 with respect to the Company, all of the Notes at the time outstanding shall
automatically become immediately due and payable together with interest accrued
thereon and together with the Yield-Maintenance Amount, if any, with respect to
each Note, without presentment, demand, protest or notice of any kind, all of
which are hereby waived by the Company, and (c) with respect to any event
constituting an Event of Default, the Required Holder(s) of the Notes of any
Series may at its or their option during the continuance of such Event of
Default, by notice in writing to the Company, declare all of the Notes of such
Series to be, and all of the Notes such Series shall thereupon be and become,
immediately due and payable together with interest accrued thereon and together
with the Yield-Maintenance Amount, if any, with respect to each Note of such
Series, without presentment, demand, protest or notice of any kind, all of which
are hereby waived by the Company.

         7.2.     RESCISSION OF ACCELERATION. At any time after any or all of
the Notes of any Series shall have been declared immediately due and payable
pursuant to Section 7.1, the Required Holder(s) of the Notes of such Series may,
by notice in writing to the Company, rescind and annul such declaration and its
consequences if (a) the Company shall have paid all overdue interest on the
Notes of such Series, the principal of and Yield-Maintenance Amount, if any,
payable with respect to any Notes of such Series which have become due otherwise
than by reason of such declaration, and interest on such overdue interest and
overdue principal and Yield-Maintenance Amount at the rate specified in the
Notes of such Series, (b) the Company shall not have paid any amounts which have
become due solely by reason of such declaration, (c) all Events of Default and
Defaults, other than non-payment of amounts which have become due solely by
reason of such declaration, shall have been cured or waived pursuant to Section
11.3, and (d) no judgment or decree shall have been entered for the payment of
any amounts due pursuant to the Notes of such Series or this Agreement. No such
rescission or annulment shall extend to or affect any subsequent Event of
Default or Default or impair any right arising therefrom.

         7.3.     NOTICE OF ACCELERATION OR RESCISSION. Whenever any Note shall
be declared immediately due and payable pursuant to Section 7.1 or any such
declaration shall be rescinded and annulled pursuant to Section 7.2, the Company
shall forthwith give written notice thereof to the holder of each Note of each
Series at the time outstanding.

                                       35
<PAGE>

         7.4.     OTHER REMEDIES. If any Event of Default or Default shall occur
and be continuing, the holder of any Note may proceed to protect and enforce its
rights under this Agreement and such Note by exercising such remedies as are
available to such holder in respect thereof under applicable law, either by suit
in equity or by action at law, or both, whether for specific performance of any
covenant or other agreement contained in this Agreement or in aid of the
exercise of any power granted in this Agreement. No remedy conferred in this
Agreement upon the holder of any Note is intended to be exclusive of any other
remedy, and each and every such remedy shall be cumulative and shall be in
addition to every other remedy conferred herein or now or hereafter existing at
law or in equity or by statute or otherwise.

8.       REPRESENTATIONS, COVENANTS AND WARRANTIES.

         The Company represents, covenants and warrants as follows as of the
date hereof and on the 2003 Note Closing Date:

         8.1.     ORGANIZATION. The Company is a corporation duly organized and
existing in good standing under the laws of the State of Delaware, each
Subsidiary (including, without limitation, Big O) is duly organized and existing
in good standing under the laws of the jurisdiction in which it is incorporated,
and the Company and each Subsidiary has the corporate power to own its
respective property and to carry on its respective business as now being
conducted.

         8.2.     FINANCIAL STATEMENTS. The Company has furnished Prudential
with the following financial statements identified by a principal financial
officer of the Company: (i) consolidating and consolidated balance sheets of the
Company and its Subsidiaries as at December 31, 2001 and December 31, 2002 and
consolidating and consolidated statements of income and cash flows and a
consolidated statement of shareholders' equity of the Company and its
Subsidiaries for the Fiscal Year ended December 31, 2002, all consolidated
annual statements being reported on by PriceWaterhouseCoopers LLP. Such
financial statements (including any related schedules and/or notes) are true and
correct in all material respects (subject, as to interim statements, to changes
resulting from audits and year-end adjustments), have been prepared in
accordance with GAAP consistently applied throughout the periods involved and
show all liabilities, direct and contingent, of the Company and its Subsidiaries
required to be shown in accordance with GAAP. The balance sheets fairly present
the condition of the Company and its Subsidiaries as at the dates thereof, and
the statements of income, stockholders' equity and cash flows fairly present the
results of the operations of the Company and its Subsidiaries and their cash
flows for the periods indicated. There has been no material adverse change in
the business, property or assets, condition (financial or otherwise), operations
or prospects of the Company and its Subsidiaries taken as a whole since the end
of the most recent Fiscal Year for which such audited financial statements have
been furnished.

                                       36

<PAGE>

         8.3.     ACTIONS PENDING. There is no action, suit, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the
Company or any of its Subsidiaries, or any properties or rights of the Company
or any of its Subsidiaries, by or before any court, arbitrator or administrative
or governmental body which might result in any material adverse change in the
business, property or assets, condition (financial or otherwise) or operations
of the Company and its Subsidiaries taken as a whole.

         8.4.     OUTSTANDING INDEBTEDNESS. Neither the Company nor any of its
Subsidiaries has outstanding any Indebtedness except as permitted by Section
6.2. There exists no default under the provisions of any instrument evidencing
such Indebtedness or of any agreement relating thereto.

         8.5.     TITLE TO PROPERTIES. The Company and each of its Subsidiaries
has good and indefeasible title to its respective real properties (other than
properties which it leases) and good title to all of its other respective
properties and assets, including the properties and assets reflected in the most
recent audited balance sheet referred to in Section 8.2 (other than properties
and assets disposed of in the ordinary course of business), subject to no Lien
of any kind except Liens permitted by Section 6.3. All leases necessary in any
material respect for the conduct of the respective businesses of the Company and
its Subsidiaries are valid and subsisting and are in full force and effect.

         8.6.     TAXES. The Company and each of its Subsidiaries has filed all
federal, state and other income tax returns which, to the best knowledge of the
officers of the Company and its Subsidiaries, are required to be filed, and each
has paid all taxes as shown on such returns and on all assessments received by
it to the extent that such taxes have become due, except such taxes as are being
contested in good faith by appropriate proceedings for which adequate reserves
have been established in accordance with GAAP.

         8.7.     CONFLICTING AGREEMENTS AND OTHER MATTERS. Neither the Company
nor any of its Subsidiaries is a party to any contract or agreement or subject
to any charter or other corporate restriction which materially and adversely
affects the business, property or assets, condition (financial or otherwise) or
operations of the Company and its Subsidiaries taken as a whole. Neither the
execution nor the delivery of any Financing Document, nor fulfillment of nor
compliance with the terms and provisions of the Financing Documents and of the
Notes did or will conflict with, or result in a breach of the terms, conditions
or provisions of, or constitute a default under, or result in any violation of,
or result in the creation of any Lien (other than Liens created by the Guarantee
and Collateral Agreement and the New Mortgage) upon any of the properties or
assets of the Company or any of its Subsidiaries pursuant to, the charter or
by-laws of the Company or any of its Subsidiaries, any award of any arbitrator
or any agreement (including any agreement with stockholders), instrument, order,
judgment, decree,

                                       37
<PAGE>

statute, law, rule or regulation to which the Company or any of its Subsidiaries
is subject. Neither the Company nor any of its Subsidiaries is a party to, or
otherwise subject to any provision contained in, any instrument evidencing
Indebtedness of the Company or such Subsidiary, any agreement relating thereto
or any other contract or agreement (including its charter) which limits the
amount of, or otherwise imposes restrictions on the incurring of, Indebtedness
of the Company of the type to be evidenced by the Notes except as set forth in
the agreements listed in Schedule 8.7 attached hereto.

         8.8.     MARGIN SECURITIES. None of the transactions contemplated
herein and in the Notes (including, without limitation, the use of the proceeds
from the original sale of the Existing Notes) violates, will violate or will
result in a violation of Regulation T, Regulation U or Regulation X or any other
regulation of the Board of Governors of the Federal Reserve System or the
Exchange Act, in each case as in effect now or as the same may hereafter be in
effect.

         8.9.     ERISA. No accumulated funding deficiency (as defined in
section 302 of ERISA and section 412 of the Code), whether or not waived, exists
with respect to any Plan (other than a Multiemployer Plan). No liability to the
PBGC has been or is expected by the Company or any ERISA Affiliate to be
incurred with respect to any Plan (other than a Multiemployer Plan) by the
Company, any Subsidiary or any ERISA Affiliate which is or would be materially
adverse to the business, property or assets, condition (financial or otherwise)
or operations of the Company and its Subsidiaries taken as a whole. Neither the
Company, any Subsidiary nor any ERISA Affiliate has incurred or presently
expects to incur any withdrawal liability under Title IV of ERISA with respect
to any Multiemployer Plan which is or would be materially adverse to the
business, property or assets, condition (financial or otherwise) or operations
of the Company and its Subsidiaries taken as a whole. The execution and delivery
of the Financing Documents will be exempt from or will not involve any
transaction which is subject to the prohibitions of section 406 of ERISA and
will not involve any transaction in connection with which a penalty could be
imposed under section 502(i) of ERISA or a tax could be imposed pursuant to
section 4975 of the Code. The representation by the Company in the preceding
sentence is made in reliance upon and subject to the accuracy of the
representation made by Prudential in Section 9.1 as to the source of funds used
by it to purchase the Existing Notes.

         8.10.    GOVERNMENTAL CONSENT. Neither the nature of the Company or of
any Subsidiary, nor any of their respective businesses or properties, nor any
relationship between the Company or any Subsidiary and any other Person, nor any
circumstance in connection with the Amendment and Restatement, is such as to
require any authorization, consent, approval, exemption or any action by or
notice to or filing with any court or administrative or governmental body in
connection with the execution and delivery of this Agreement or any other
Financing

                                       38
<PAGE>

Document, or the fulfillment of or compliance with the terms and provisions
hereof or of the Notes.

         8.11.    ENVIRONMENTAL COMPLIANCE. (a) The Company and its Subsidiaries
and all of their respective properties and facilities have complied at all times
and in all respects with all foreign, federal, state, local and regional
statutes, laws, ordinances and judicial or administrative orders, judgments,
rulings and regulations relating to protection of the environment except, in any
such case, where failure to comply would not result in a Material Adverse
Effect.

         (b)      The environmental audits regarding the real properties which
are part of the Merchant's Acquisition provided to the co-administrative agent
under the Credit Agreement do not contain any finding that, individually or in
the aggregate, could reasonably be expected to result in a Material Adverse
Effect.

         8.12.    DISCLOSURE. Neither this Agreement nor any other Financing
Document nor any other document, certificate or statement furnished to
Prudential or the Collateral Agent by or on behalf of the Company or any
Subsidiary in connection with any Financing Document contains any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements contained herein and therein not misleading. There
is no fact peculiar to the Company or any of its Subsidiaries which materially
adversely affects or in the future may (so far as the Company can now foresee)
materially adversely affect the business, property or assets, condition
(financial or otherwise) or operations of the Company or any of its Subsidiaries
and which has not been set forth in this Agreement.

         8.13.    TRADEMARKS; TRADENAMES, ETC. Schedule 8.13 accurately
describes the names and registration numbers of all federally registered
trademarks, tradenames and service marks of the Company and its Subsidiaries as
of the 2003 Note Closing Date.

         8.14.    STATUS UNDER CERTAIN STATUTES.

         Neither the Company nor any Subsidiary is (a) subject to regulation
under the Investment Company Act of 1940, as amended, the Public Utility Holding
Company Act of 1935, as amended, or the Federal Power Act, as amended, or (b) in
violation of the USA Patriot Act.

         8.15.    ANTI-TERRORISM ORDER.

         Neither the Company nor any of its Subsidiaries is a Person or entity
described in Section 1 of the Anti-Terrorism Order or described in the
Department of the Treasury Rule, and, to the best knowledge and belief of the
Company, neither the Company nor any of its Subsidiaries engages in any dealings
or transactions, or

                                       39
<PAGE>

is otherwise associated, with any such Persons or entities.

         8.16.    EXISTING MORTGAGE.

         The Notes are secured by a first priority  perfected  security
interest in favor of the Collateral  Agent (for the benefit of Prudential) in
the real property and improvements described in (and pursuant to) the Existing
Mortgage.

9.       REPRESENTATIONS OF THE NOTEHOLDER.

         Prudential represents as follows:

         9.1.     SOURCE OF FUNDS. Prudential represents that at least one of
the following statements is an accurate representation as to each source of
funds (a "SOURCE") used by it to pay the purchase price of the Notes:

                  (a)      the Source was an "insurance company general account"
         (as the term is defined in the United States Department of Labor's
         Prohibited Transaction Exemption ("PTE") 95-60) in respect of which the
         reserves and liabilities (as defined by the annual statement for life
         insurance companies approved by the National Association of Insurance
         Commissioners (the "NAIC ANNUAL STATEMENT")) for the general account
         contract(s) held by or on behalf of any employee benefit plan together
         with the amount of the reserves and liabilities for the general account
         contract(s) held by or on behalf of any other employee benefit plans
         maintained by the same employer (or affiliate thereof as defined in PTE
         95-60) or by the same employee organization in the general account do
         not and did not exceed 10% of the total reserves and liabilities of the
         general account (exclusive of separate account liabilities) plus
         surplus as set forth in the NAIC Annual Statement filed with
         Prudential's state of domicile; or

                  (b)      the Source was and is a separate account maintained
         solely in connection with Prudential's fixed contractual obligations
         under which the amounts payable, or credited, to any employee benefit
         plan (or its related trust) that has any interest in such separate
         account (or to any participant or beneficiary of such plan (including
         any annuitant)) are not affected in any manner by the investment
         performance of the separate account; or

                  (c)      the Source was and is either (i) an insurance company
         pooled separate account, within the meaning of PTE 90-1 or (ii) a bank
         collective investment fund, within the meaning of the PTE 91-38 and,
         except as disclosed by Prudential to the Company in writing pursuant to
         this clause (c), no employee benefit plan or group of plans maintained
         by the same employer or employee organization beneficially owned more
         than 10% of all assets

                                       40
<PAGE>

         allocated to such pooled separate account or collective investment fund
         at the time of the purchase of the Notes; or

                  (d)      the Source constituted and constitutes assets of an
         "investment fund" (within the meaning of Part V of PTE 84-14 (the "QPAM
         EXEMPTION")) managed by a "qualified professional asset manager" or
         "QPAM" (within the meaning of Part V of the QPAM Exemption), no
         employee benefit plan's assets that were included in such investment
         fund, when combined with the assets of all other employee benefit plans
         established or maintained by the same employer or by an affiliate
         (within the meaning of Section V(c)(1) of the QPAM Exemption) of such
         employer or by the same employee organization and managed by such QPAM,
         exceeded 20% of the total client assets managed by such QPAM at the
         time of the purchase of the Notes by Prudential or now exceed such
         level, the conditions of Part I(c) and (g) of the QPAM Exemption were
         satisfied at such time and are now satisfied, neither the QPAM nor a
         person controlling or controlled by the QPAM (applying the definition
         of "control" in Section V(e) of the QPAM Exemption) owned a 5% or more
         interest in the Company at such time or now owns such an interest and
         (i) the identity of such QPAM and (ii) the names of all employee
         benefit plans whose assets were included in such investment fund were
         disclosed to the Company in writing pursuant to this clause (d) prior
         to such purchase; or

                  (e)      the Source constituted assets of a "plan(s)" (within
         the meaning of Section IV of PTE 96-23 (the "INHAM EXEMPTION")) managed
         by an "in-house asset manager" or "INHAM" (within the meaning of Part
         IV of the INHAM exemption), the conditions of Part I(a), (g) and (h) of
         the INHAM Exemption were satisfied at the time of the purchase of Notes
         by Prudential and are now satisfied, neither the INHAM nor a person
         controlling or controlled by the INHAM (applying the definition of
         "control" in Section IV(h) of the INHAM Exemption) owned a 5% or more
         interest in the Company at such time or now owns such an interest and
         (i) the identity of such INHAM and (ii) the name(s) of the employee
         benefit plan(s) whose assets constituted the Source were disclosed to
         the Company in writing prior to such purchase pursuant to this clause
         (e); or

                  (f)      the Source was (and remains) a governmental plan; or

                  (g)      the Source was (and remains) one or more employee
         benefit plans, or a separate account or trust fund comprised of one or
         more employee benefit plans, each of which was identified to the
         Company in writing prior to such purchase pursuant to this clause (g);
         or

                  (h)      the Source did not and does not include assets of any
         employee benefit plan, other than a plan exempt from the coverage of
         ERISA.

                                       41

<PAGE>

     As used in this Section 6.2, the terms "EMPLOYEE BENEFIT PLAN,"
"GOVERNMENTAL PLAN," and "SEPARATE ACCOUNT" shall have the respective meanings
assigned to such terms in Section 3 of ERISA.

10.  DEFINITIONS; ACCOUNTING MATTERS.

     For the purpose of this Agreement, the terms defined in Sections 10.1 and
10.2 (or within the text of any other Section) shall have the respective
meanings specified therein and all accounting matters shall be subject to
determination as provided in Section 10.3.

10.1. YIELD-MAINTENANCE TERMS.

     "CALLED PRINCIPAL" shall mean, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to Section 4.2, Section 4.7 or Section
4.8 or is declared to be immediately due and payable pursuant to Section 7.1, as
the context requires.

     "DISCOUNTED VALUE" shall mean, with respect to the Called Principal of any
Note, the amount obtained by discounting all Remaining Scheduled Payments with
respect to such Called Principal from their respective scheduled due dates to
the Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (as converted to reflect
the periodic basis on which interest on such Note is payable, if payable other
than on a semi-annual basis) equal to the Reinvestment Yield with respect to
such Called Principal.

     "REINVESTMENT YIELD" shall mean, with respect to the Called Principal of
any Note, .50% (50 basis points) over the yield to maturity implied by (i) the
yields reported, as of 10:00 A.M. (New York City local time) on the Business Day
next preceding the Settlement Date with respect to such Called Principal, for
actively traded U.S. Treasury securities having a maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date on
the Treasury Yield Monitor page of Standard & Poor's MMS - Treasury Market
Insight (or, if Standard & Poor's shall cease to report such yields in MMS -
Treasury Market Insight or shall cease to be Prudential Capital Group's
customary source of information for calculating make-whole amounts on privately
placed notes, then such source as is then Prudential Capital Group's customary
source of such information), or (ii) if such yields shall not be reported as of
such time or the yields reported as of such time shall not be ascertainable, the
Treasury Constant Maturity Series yields reported, for the latest day for which
such yields shall have been so reported as of the Business Day next preceding
the Settlement Date with respect to such Called Principal, in Federal Reserve
Statistical Release H.15 (519) (or any comparable successor publication) for
actively traded U.S. Treasury securities having a constant maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date. Such
implied yield shall be determined, if necessary, by (a)

                                       42
<PAGE>

converting U.S. Treasury bill quotations to bond-equivalent yields in accordance
with accepted financial practice and (b) interpolating linearly between yields
reported for various maturities. The Reinvestment Yield shall be rounded to that
number of decimal places as appears in the coupon of the applicable Note.

     "REMAINING AVERAGE LIFE" shall mean, with respect to the Called Principal
of any Note, the number of years (calculated to the nearest one-twelfth year)
obtained by dividing (i) such Called Principal into (ii) the sum of the products
obtained by multiplying (a) each Remaining Scheduled Payment of such Called
Principal (but not of interest thereon) by (b) the number of years (calculated
to the nearest one-twelfth year) which will elapse between the Settlement Date
with respect to such Called Principal and the scheduled due date of such
Remaining Scheduled Payment.

     "REMAINING SCHEDULED PAYMENTS" shall mean, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon at the rate in effect on the Settlement Date that would be due on or
after the Settlement Date with respect to such Called Principal if no payment of
such Called Principal were made prior to its scheduled due date.

     "SETTLEMENT DATE" shall mean, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant to
Section 4.2, Section 4.7 or Section 4.8 or is declared to be immediately due and
payable pursuant to Section 7.1, as the context requires.

     "YIELD-MAINTENANCE AMOUNT" shall mean, with respect to any Note, an amount
equal to the excess, if any, of the Discounted Value of the Called Principal of
such Note over the sum of (i) such Called Principal plus (ii) interest accrued
thereon as of (including interest due on) the Settlement Date with respect to
such Called Principal. The Yield-Maintenance Amount shall in no event be less
than zero.

10.2. OTHER DEFINED TERMS.

     "ACCEPTABLE ACQUISITION" shall have the meaning specified in Section
6.5(g).

     "ACCEPTED NOTES" shall have the meaning specified in Section 4.8(c)(i).

     "ACQUISITION" shall mean any transaction pursuant to which the Company or
any of its Wholly-Owned Subsidiaries (a) acquires all of the outstanding equity
securities of any Person other than the Company or any Person which is then a
Wholly-Owned Subsidiary of the Company, (b) otherwise makes any Person a
Wholly-Owned Subsidiary of the Company, in any case pursuant to a merger,
purchase of assets or any reorganization, or (c) purchases all or substantially
all of

                                       43
<PAGE>

the business or assets of any Person other than a Wholly-Owned Subsidiary of the
Company or of any business unit or line of business of any such Persons.

     "ADDITIONAL MORTGAGED PROPERTY" means any real property of the Company or
any Subsidiary in respect of which the Collateral Agent has been granted a
mortgage under Section 5.8 hereof.

     "AFFILIATE" shall mean any Person directly or indirectly controlling,
controlled by, or under direct or indirect common control with, the Company,
except a Subsidiary. A Person shall be deemed to control a corporation if such
Person possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of such corporation, whether through
the ownership of voting securities, by contract or otherwise.

     "AGREEMENT, THIS" shall have the meaning specified in Section 11.3.

     "AMENDMENT AND RESTATEMENT" shall have the meaning specified in Section 2.

     "AMENDMENT FEE" shall have the meaning specified in Section 3.5.

     "ANTI-TERRORISM ORDER" means United States of America Executive Order No.
13,224 of September 23, 2001, Blocking Property and Prohibiting Transactions
With Persons Who Commit, Threaten to Commit, or Support Terrorism, 66 Fed. Reg.
49,049 (2001).

     "ASSET SALE PROCEEDS NOTICE" shall have the meaning specified in Section
4.8(a).

     "AUTHORIZED OFFICER" shall mean, with respect to the Company, its chief
executive officer, its chief financial officer or any vice president of the
Company designated as an "Authorized Officer" of the Company for the purpose of
this Agreement in an Officer's Certificate executed by the Company's chief
executive officer or chief financial officer and delivered to Prudential. Any
action taken under this Agreement on behalf of the Company by any individual who
on or after the date of this Agreement shall have been an Authorized Officer of
the Company and whom Prudential in good faith believes to be an Authorized
Officer of the Company at the time of such action shall be binding on the
Company even though such individual shall have ceased to be an Authorized
Officer of the Company.

     "BANKRUPTCY LAW" shall have the meaning specified in clause (i) of Section
7.1.

     "BANK TERM LOAN" shall mean a loan made under the Credit Agreement pursuant
to either of Sections 2.01(b) or 2.01(c) of the Credit Agreement.

                                       44
<PAGE>

     "BIG O" shall mean Big O Tires, Inc., a Nevada corporation.

     "BUSINESS DAY" shall mean any day other than (i) a Saturday or a Sunday,
and (ii) a day on which commercial banks in New York City are required or
authorized to be closed.

     "CAPITAL EXPENDITURES" mean, for any period, expenditures (including the
aggregate amount of Capitalized Lease Obligations incurred during such period)
made directly or indirectly by the Company or any Subsidiary to acquire or
construct fixed assets, property, plant and equipment (including renewals,
improvements, replacements and substitutions, but excluding repairs) during such
period, computed in accordance with GAAP.

     "CAPITAL STOCK" means any class of capital stock, share capital or similar
equity interest of a Person.

     "CAPITALIZED LEASE OBLIGATION" shall mean any rental obligation which is or
will be required to be capitalized on the books of the Company or any Subsidiary
in accordance with GAAP, taken at the amount thereof accounted for as
indebtedness (net of interest expenses) in accordance with such principles.

     "CHANGE IN CONTROL" means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any person or group (within the
meaning of the Exchange Act and the rules of the Securities and Exchange
Commission thereunder as in effect on the date hereof) of shares representing
more than 20% of the aggregate ordinary voting power represented by the issued
and outstanding capital stock of the Company; (b) occupation of a majority of
the seats (other than vacant seats) on the board of directors of the Company by
Persons who were neither (i) nominated by the board of directors of the Company
nor (ii) appointed by directors so nominated; or (c) the acquisition of direct
or indirect Control of the Company by any Person or group.

     "CODE" shall mean the Internal Revenue Code of 1986, as amended.

     "COLLATERAL AGENT" means J.P. Morgan Chase Bank, N.A., in its capacity as
collateral agent on behalf of the holders of Notes, the holders of 2003 Notes
and the bank lenders under the Intercreditor Agreement.

     "COMPANY" shall have the meaning given to such term in the introductory
sentence hereof.

     "CONSOLIDATED ADJUSTED DEBT" shall have the meaning specified in Section
6.1(c).

     "CONSOLIDATED FUNDED INDEBTEDNESS" means all Funded Indebtedness of the
Company and its Subsidiaries after eliminating inter-company items, including

                                       45
<PAGE>

any Funded Indebtedness outstanding pursuant to and under this Agreement, in
each case determined on a consolidated basis in accordance with GAAP.

     "CONSOLIDATED INTEREST EXPENSE" means, for any period for which such amount
is being determined, the interest expense of the Company and its Consolidated
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP, including (i) the amortization of debt discounts to the extent
included in interest expense in accordance with GAAP, (ii) the amortization of
all fees (including fees with respect to Hedging Agreements) payable in
connection with the incurrence of Indebtedness to the extent included in
interest expense in accordance with GAAP and (iii) the portion of any rents
payable under Capitalized Lease Obligations allocable to interest expense in
accordance with GAAP.

     "CONSOLIDATED NET INCOME" means, as to any period, the net income of the
Company and its Consolidated Subsidiaries for such period, after taxes and after
extraordinary items as determined on a consolidated basis in accordance with
GAAP.

     "CONSOLIDATED SUBSIDIARIES" means Subsidiaries whose accounts are
consolidated with the accounts of the Company in the Company's consolidated
financial statements prepared in accordance with GAAP.

     "CONTROL" means the possession, directly or indirectly, of the power to
direct or cause the direction of management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.

     "CONTROL EVENT" means:

          (a) the execution by the Company or any of its Subsidiaries of any
     agreement or letter of intent with respect to any proposed transaction or
     event or series of transactions or events which, individually or in the
     aggregate, may reasonably be expected to result in a Change in Control;

          (b) the execution of any written agreement which, when fully performed
     by the parties thereto, would result in a Change in Control; or

          (c) the commencement (as defined in Regulation 14D of the Exchange
     Act) of a tender offer by any Person or group (as such terms are defined in
     the definition of "Change in Control") to the holders of the Voting Stock
     of the Company, which offer, if accepted by the requisite number of
     holders, would result in a Change in Control.

     "CREDIT AGREEMENT" shall have the meaning specified in Section 1.1.

                                       46
<PAGE>

     "DEPARTMENT OF THE TREASURY RULE" means the United States of America
Department of the Treasury rule entitled Blocked Persons, Specially Designated
Nationals, Specifically Designated Terrorists, Foreign Terrorist Organizations,
and Specially Designated Narcotics Traffickers: Additional Designations of
Terrorism-Related Blocked Persons, 66 Fed. Reg. 54,404 (2001) (to be codified at
appendix A to 31 CFR chapter V), as amended.

     "EBITDA" shall mean, as to any period, the sum of (i) Consolidated Net
Income, plus (ii) consolidated depreciation, amortization and all other non-cash
charges plus (iii) income taxes to the extent they reduce Consolidated Net
Income, plus (iv) Consolidated Interest Expense.

     In addition, (a) EBITDA shall include, on a pro forma basis for each Fiscal
Quarter (including any pro forma cost savings to the extent the same could be
reflected in pro forma financial statements contained in filings with the
Securities and Exchange Commission pursuant to its Regulation S-X), the
foregoing information with respect to each Person that was either acquired in an
Acceptable Acquisition or disposed of as permitted by this Agreement during such
Fiscal Quarter, determined as if the Acquisition or disposition had taken place
on the first day of such Fiscal Quarter; and (b) whenever in this Agreement
EBITDA is determined for a period of four Fiscal Quarters, it shall include, on
a pro forma basis for such period (including any pro forma cost savings referred
to in the parenthetical above), the foregoing information with respect to each
Person that was either acquired in an Acceptable Acquisition or disposed of as
permitted by this Agreement during such period, determined as if the Acquisition
or disposition had taken place on the first day of such four Fiscal Quarter
period.

     "EBITDAR" shall mean the aggregate EBITDA for the period of four completed
Fiscal Quarters then most recently ended plus the aggregate rental payments made
(net of any sublease income) by the Company and its Subsidiaries during such
period.

     "ENVIRONMENTAL AND SAFETY LAWS" shall mean all laws relating to pollution,
the release or other discharge, handling, disposition or treatment of Hazardous
Materials and other substances or the protection of the environment or of
employee health and safety, including without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. Section 9601
et. seq.), the Hazardous Materials Transportation Act (49 U.S.C. Section 1801
et. seq.), the Resource Conservation and Recovery Act (42 U.S.C. Section 7401
et. seq.), the Clean Air Act (42 U.S.C. Section 401 et. seq.), the Toxic
Substances Control Act (15 U.S.C. Section 2601 et. seq.), the Occupational
Safety and Health Act (29 U.S.C. Section 651 et. seq.) and the Emergency
Planning and Community Right-To-Know Act (42 U.S.C. Section 11001 et. seq.),
each as the same may be amended and supplemented.

                                       47
<PAGE>

     "ENVIRONMENTAL COSTS AND LIABILITIES" shall mean, as to any Person, all
liabilities, obligations, responsibilities, remedial actions, losses, damages,
punitive damages, consequential damages, treble damages, contribution, cost
recovery, costs and expenses (including all fees, disbursements and expenses of
counsel, expert and consulting fees, and costs of investigation and feasibility
studies), fines, penalties, sanctions and interest incurred as a result of any
claim or demand, by any Person, whether based in contract, tort, implied or
express warranty, strict liability, criminal or civil statute, permit, order or
agreement with any Federal, state or local governmental authority or other
Person, arising from environmental, health or safety conditions, or the release
or threatened release of a contaminant, pollutant or Hazardous Material into the
environment, resulting from the operations of such Person or its subsidiaries,
or breach of any Environmental and Safety Law or for which such Person or its
subsidiaries is otherwise liable or responsible.

     "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.

     "ERISA AFFILIATE" shall mean any corporation which is a member of the same
controlled group of corporations as the Company within the meaning of section
414(b) of the Code, or any trade or business which is under common control with
the Company within the meaning of section 414(c) of the Code.

     "EVENT OF DEFAULT" shall mean any of the events specified in Section 7.1,
provided that there has been satisfied any requirement in connection with such
event for the giving of notice, or the lapse of time, or the happening of any
further condition, event or act, and "DEFAULT" shall mean any of such events,
whether or not any such requirement has been satisfied.

     "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended.

     "EXCLUDED FOREIGN SUBSIDIARY" means any Foreign Subsidiary in respect of
which either (a) the pledge of all of the Capital Stock of such Subsidiary as
collateral or (b) the guaranteeing by such Subsidiary of the obligations of the
Company to the holders of Notes, would, in the good faith judgment of the
Company, result in adverse tax consequences to the Company.

     "EXISTING CREDIT AGREEMENT" means the Amended and Restated Credit Agreement
dated as of January 5, 2001, among the Company, First Tennessee Bank National
Association, as Administrative Agent, and the lenders party thereto.

     "EXISTING MORTGAGE" means that certain Deed of Trust, Assignment of Leases
and Security Agreement, dated as of January 5, 2001, in respect of real property
and improvements in Memphis, Tennessee owned by the Company

                                       48
<PAGE>

securing its obligations to, among other parties, Prudential, in respect of,
among other obligations, the Company's obligations under this Agreement and the
Notes.

     "EXISTING NOTE AGREEMENT" shall have the meaning specified in Section 1.1.

     "EXISTING NOTES" shall have the meaning specified in Section 1.1.

     "EXISTING SERIES A NOTES" shall have the meaning specified in Section 1.1.

     "EXISTING SERIES B NOTES" shall have the meaning specified in Section 1.1.

     "EXISTING SERIES C NOTES" shall have the meaning specified in Section 1.1.

     "FINANCING DOCUMENT(S)" shall mean each of this Agreement, the Notes, the
Guarantee and Collateral Agreement, the New Mortgage, the Existing Mortgage and
any mortgage in respect of Additional Mortgaged Property granted pursuant to
Section 5.8 hereof.

     "FISCAL QUARTER" means each fiscal quarter-year period of the Company,
ending on the last day of each March, June, September and December.

     "FISCAL YEAR" means the fiscal year of the Company, which is the calendar
year.

     "FIXED CHARGE COVERAGE RATIO" shall have the meaning specified in Section
6.1(a).

     "FIXED CHARGES" shall mean, for any period, the sum of Consolidated
Interest Expense, Scheduled Payments and Capital Expenditures for such period.

     "FOREIGN SUBSIDIARY" means any Subsidiary organized in any jurisdiction
other than the United States of America or any jurisdiction thereof.

     "FUNDED INDEBTEDNESS" means any outstanding Indebtedness of a Person for
borrowed money, including all such Indebtedness of the Person to Prudential and
other financial institutions, domestic or foreign, and all secured and unsecured
notes payable, all industrial revenue bonds, all Capitalized Lease Obligations
and other similar debt obligations and the current maturities thereof, but
excluding all Guarantees of Funded Indebtedness. (Checks that have not been
presented for payment shall not constitute Funded Indebtedness.)

     "GAAP" means generally accepted accounting principles in effect in the
United States of America at the time of application thereof.

                                       49
<PAGE>

     "GOOD FAITH CONTEST" shall mean, with respect to any tax, assessment, Lien,
obligation, claim, liability, judgment, injunction, award, decree, order, law,
regulation, statute or similar item, any challenge or contest thereof by
appropriate proceedings timely initiated in good faith by the Company or any
Subsidiary for which adequate reserves therefor have been taken in accordance
with GAAP.

     "GOVERNMENTAL AUTHORITY" means the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.

     "GUARANTEE" of or by any Person (the "guarantor") shall mean any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term "Guarantee" shall not
include endorsements for collection or deposit in the ordinary course of
business.

     "GUARANTEE AND COLLATERAL AGREEMENT" shall have the meaning specified in
Section 3.6.

     "HAZARDOUS MATERIALS" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental and Safety Law.

     "HEDGING AGREEMENTS" means any interest rate protection agreement, foreign
currency exchange agreement, commodity price protection agreement or other
interest or currency exchange rate or commodity price hedging agreement.

     "INCLUDING" shall mean, unless the context clearly requires otherwise,
"including without limitation".

                                       50
<PAGE>

     "INDEBTEDNESS" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (f) all
indebtedness of others 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 owned or acquired by such Person, whether or not the indebtedness
secured thereby has been assumed, (g) all Guarantees by such Person of
indebtedness of others, (h) all Capitalized Lease Obligations of such Person,
(i) all obligations, contingent or otherwise, of such Person as an account party
in respect of letters of credit and letters of guaranty, (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances, and
(k) all obligations of such Person related to Synthetic Leases. The indebtedness
of any Person shall include the indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such Person
is liable therefor as a result of such Person's ownership interest in or other
relationship with such entity, except to the extent the terms of such
indebtedness provide that such Person is not liable therefor.

     "INHAM EXEMPTION" shall have the meaning specified in Section 9.1(e).

     "INTERCOMPANY LOAN" means any short term demand loan made by the Company to
any of its Wholly-Owned Subsidiaries, by any such Wholly-Owned Subsidiary to the
Company or by a Wholly-Owned Subsidiary of the Company to another Wholly-Owned
Subsidiary.

     "INTERCREDITOR AGREEMENT" shall have the meaning specified in Section 3.6.

     "INTEREST RATE CHANGE DATE" shall mean the earliest date on or after March
31, 2002 that the Leverage Ratio is greater than 2.75 to 1.0 as of the end of
two consecutive Fiscal Quarters.

     "INTEREST RATE EFFECTIVE DATE" shall mean the first day of the Fiscal
Quarter ending on the Interest Rate Change Date.

     "JOINT VENTURE" means a joint venture formed to provide distribution for
the products of the Company, Big O or any other Subsidiary, which joint venture
is accounted for under GAAP as an investment and not as a Subsidiary or as an
acquisition or a capital expenditure.

     "LEVERAGE RATIO" shall have the meaning specified in Section 6.1(b).

                                       51
<PAGE>

     "LIEN" means, with respect to any asset, (a) any mortgage, deed of trust,
lien, pledge, hypothecation, encumbrance, charge or security interest in, on or
of such asset, (b) the interest of a vendor or a lessor under any conditional
sale agreement, capital lease or title retention agreement (or any financing
lease having substantially the same economic effect as any of the foregoing)
relating to such asset and (c) in the case of securities, any purchase option,
call or similar right of a third party with respect to such securities.

     "LONG-TERM INDEBTEDNESS" means any Indebtedness that, in accordance with
GAAP constitutes (or, when incurred, constituted) a long-term liability.

     "MATERIAL ADVERSE EFFECT" shall mean (i) a material adverse effect on the
business, assets, operations, prospects or condition, financial or otherwise, of
the Company and its Subsidiaries, taken as a whole or (ii) material impairment
of the validity or enforceability or the rights of, or the benefits available
to, the holders of any of the Notes under this Agreement or the Notes.

     "MATERIAL INDEBTEDNESS" means Indebtedness (other than the Notes) or
obligations in respect of one or more Hedging Agreements, of any one or more of
the Company and its Subsidiaries in an aggregate principal amount exceeding
$5,000,000. For purposes of determining Material Indebtedness, the "principal
amount" of the obligations of the Company or any Subsidiary in respect of any
Hedging Agreement at any time shall be the maximum aggregate amount (giving
effect to any netting agreements) that the Company or such Subsidiary would be
required to pay if such Hedging Agreement were terminated at such time.

     "MERCHANT'S ACQUISITION" means the acquisition of Merchant's, Incorporated
and Merban, Inc. on the terms set forth in the Merchant's Acquisition
Documentation.

     "MERCHANT'S ACQUISITION AGREEMENT" means the Stock Purchase Agreement,
dated March 25, 2003, by and among the Company and the stockholders of
Merchant's, Incorporated.

     "MERCHANT'S ACQUISITION DOCUMENTATION" means, collectively, the Merchant's
Acquisition Agreement and all schedules, exhibits and annexes thereto and all
side letters and agreements affecting the terms thereof or entered into in
connection therewith.

     "MOODY'S" shall mean Moody's Investors Service, Inc. or any successor
thereto.

     "MULTIEMPLOYER PLAN" shall mean any Plan which is a "multiemployer plan"
(as such term is defined in section 4001(a)(3) of ERISA.

                                       52
<PAGE>

     "NAIC ANNUAL STATEMENT" shall have the meaning specified in Section 9.1(a).

     "NET PROCEEDS" shall mean, with respect to any event, (a) the cash proceeds
received in respect of such event, including (i) any cash received in respect of
any non-cash proceeds, but only as and when received, (ii) in the case of a
casualty or other insured damage, insurance proceeds, and (iii) in the case of a
condemnation or similar event, condemnation awards and similar payments, net of
(b) the sum of (i) all reasonable fees and out-of-pocket expenses paid by the
Company and its Subsidiaries to third parties in connection with such event,
(ii) in the case of a sale, transfer or other disposition of an asset (including
pursuant to a sale and leaseback transaction permitted under Section 6.10(d) or
a casualty or a condemnation or similar proceeding), the amount of all payments
required to be made by the Company and its Subsidiaries as a result of such
event to repay Indebtedness (other than obligations under the Credit Agreement
and the Notes) secured by such asset or otherwise subject to mandatory
prepayment as a result of such event (to the extent such repayment is permitted
hereunder), and (iii) the amount of all taxes paid (or reasonably estimated to
be payable) by the Company or any Subsidiary, and the amount of any reserves
established by the Company and its Subsidiaries to fund contingent liabilities
or contingent obligations reasonably estimated to be payable, in each case
during the year that such event occurred or the next succeeding year and that
are directly attributable to such event (as determined reasonably and in good
faith by the chief financial officer of the Company), provided that the amount
of any subsequent reduction of any such reserve (other than in connection with a
payment in respect of any such liability) shall be deemed to be Net Proceeds of
a Prepayment Event occurring on the date of such reduction.

     "NEW MORTGAGE" means that certain Deed of Trust, Assignment of Leases and
Security Agreement, dated as of March 31, 2003, in respect of real property and
improvements in Memphis, Tennessee owned by the Company securing its obligations
to, among other parties, Prudential, in respect of, among other obligations, the
Company's obligations under this Agreement and the Notes.

     "NOTE(S)" shall have the meaning specified in Section 1.3.

     "OFFICER'S CERTIFICATE" shall mean a certificate signed in the name of the
Company by an Authorized Officer of the Company.

     "ORIGINAL SUBSIDIARY OBLIGORS" shall have the meaning specified in Section
3.1(b).

     "PBGC" means the Pension Benefit Guaranty Corporation, or any successor
organization.

     "PERMITTED ENCUMBRANCES" means:

                                       53
<PAGE>

          (a) Liens imposed by law for taxes that are not yet due or are being
     contested in compliance with Section 5.13;

          (b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
     and other like Liens imposed by law, arising in the ordinary course of
     business and securing obligations that are not overdue by more than 30 days
     or are being contested in compliance with Section 5.13;

          (c) pledges and deposits made in the ordinary course of business in
     compliance with workers' compensation, unemployment insurance and other
     social security laws or regulations;

          (d) deposits to secure the performance of bids, trade contracts,
     leases, statutory obligations, surety and appeal bonds, performance bonds
     and other obligations of a like nature, in each case in the ordinary course
     of business;

          (e) judgment liens in respect of judgments that do not constitute an
     Event of Default under Section 7.1(n);

          (f) easements, zoning restrictions, rights-of-way and similar
     encumbrances on real property imposed by law or arising in the ordinary
     course of business that do not secure any monetary obligations and do not
     materially detract from the value of the affected property or interfere
     with the ordinary conduct of business of the Company or any Subsidiary;

          (g) Liens of landlords on fixtures and leasehold improvements granted
     or arising in the ordinary course of business; and

          (h) Liens securing Indebtedness of the Company incurred under and in
     respect of this Agreement, the 2003 Note Purchase Agreement and the Credit
     Agreement;

provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness (other than in respect of the Liens described in clause
(h) of this definition).

     "PERMITTED INVESTMENTS" means:

          (a) direct obligations of, or obligations the principal of and
     interest on which are unconditionally guaranteed by, the United States of
     America (or by any agency thereof to the extent such obligations are backed
     by the full faith and credit of the United States of America), in each case
     maturing within one year from the date of acquisition thereof;

                                       54
<PAGE>

          (b) investments in commercial paper maturing within 270 days from the
     date of acquisition thereof and having, at such date of acquisition, the
     highest credit rating obtainable from S&P or from Moody's;

          (c) investments in certificates of deposit, banker's acceptances and
     time deposits maturing within 180 days from the date of acquisition thereof
     issued or guaranteed by or placed with, and money market deposit accounts
     issued or offered by, any domestic office of any commercial bank organized
     under the laws of the United States of America or any State thereof which
     has a combined capital and surplus and undivided profits of not less than
     $500,000,000; and

          (d) fully collateralized repurchase agreements with a term of not more
     than 30 days for securities described in clause (a) above and entered into
     with a financial institution satisfying the criteria described in clause
     (c) above.

     "PERSON" shall mean and include an individual, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization and a government
or any department or agency thereof.

     "PLAN" shall mean any employee pension benefit plan (as such term is
defined in section 3 of ERISA) which is or has been established or maintained,
or to which contributions are or have been made, by the Company or any ERISA
Affiliate.

     "PREPAYMENT EVENT" shall mean:

          (a) any sale and leaseback transaction permitted pursuant to Section
     6.10(d) of any property or asset of the Company or any Subsidiary; or

          (b) any casualty or other insured damage to, or any taking under power
     of eminent domain or by condemnation or similar proceeding of, any property
     or asset of the Company or any Subsidiary, but only to the extent that the
     Net Proceeds therefrom have not been applied to repair, restore or replace
     such property or asset or to acquire other real property, equipment or
     other tangible assets to be used in the business of the Company or any
     Subsidiary within one year after such event; or

          (c) any other "Prepayment Event" as defined in the Credit Agreement.

     "PREPAYMENT OFFER" shall have the meaning specified in Section 4.8(a).

     "PROCEEDS DISPOSITION DATE" shall have the meaning specified in Section
4.8(a).

                                       55
<PAGE>

     "PROPOSED PREPAYMENT DATE" shall have the meaning specified in Section
4.7(c).

     "PRUDENTIAL" shall mean The Prudential Insurance Company of America.

     "PRUDENTIAL AFFILIATE" shall mean (a) any corporation or other entity all
of the Voting Stock (or equivalent voting securities or interests) of which is
owned by Prudential either directly or through Prudential Affiliates, and (b)
any investment fund or account which is managed by Prudential or a Prudential
Affiliate described in clause (a) of this definition.

     "PTE" shall have the meaning specified in Section 9.1(a).

     "QPAM EXEMPTION" shall have the meaning specified in Section 9.1(d).

     "REQUIRED HOLDER(S)" shall mean the holder or holders of at least 51% of
the aggregate principal amount of the Notes or a Series of Notes, as the context
may require, from time to time outstanding.

     "RESPONSIBLE OFFICER" shall mean the chief executive officer, chief
operating officer, chief financial officer or chief accounting officer of the
Company, general counsel of the Company or any other officer of the Company
involved principally in its financial administration or its controllership
function.

     "RESTRICTED PAYMENT" means any dividend or other distribution (whether in
cash, securities or other property) with respect to any shares of any class of
capital stock of the Company or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, acquisition, cancellation or
termination of any such shares of capital stock of the Company or any option,
warrant or other right to acquire any such shares of capital stock of the
Company.

     "S&P" shall mean Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc. or any successor thereto.

     "SCHEDULED PAYMENTS" means, for any period, the sum (without duplication)
of the aggregate amount of scheduled principal payments made during such period
in respect of Long-Term Indebtedness of the Company and its Subsidiaries (other
than payments made by the Company or any Subsidiary to the Company or a
Subsidiary), including scheduled prepayments of the Notes pursuant to Section
4.1 for such period.

     "SECURITIES ACT" shall mean the Securities Act of 1933, as amended.

     "SERIES" shall have the meaning specified in Section 1.3.

                                       56
<PAGE>

     "SERIES A NOTE(S)" shall have the meaning specified in Section 1.2(a).

     "SERIES B NOTE(S)" shall have the meaning specified in Section 1.2(b).

     "SERIES C NOTE(S)" shall have the meaning specified in Section 1.2(c).

     "SIGNIFICANT HOLDER" shall mean (i) Prudential, so long as Prudential or
any Prudential Affiliate shall hold any Note, or (ii) any other holder of at
least 5% of the aggregate principal amount of the Notes of any Series from time
to time outstanding.

     "SOURCE" shall have the meaning specified in Section 9.1.

     "SUBSIDIARY" shall mean, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power, or in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent and one or more subsidiaries of the parent
or by the parent and one or more subsidiaries of the parent, except that no
Joint Venture in which the entire amount invested by the Company and its
subsidiaries complies with Section 6.5(d) shall be deemed to be a subsidiary.

     "SUBSIDIARY" means any subsidiary of the Company; provided, however, that
in no event shall TBC de Mexico be considered to be a Subsidiary for purposes
hereof (but, to the extent required by GAAP, shall be consolidated in the
consolidated financial statements of the Company and as such included in the
calculation of the covenants in Sections 6.1(a), 6.1(b) and 6.1(c)) until such
time, if any, as the Company's interest in TBC de Mexico exceeds 60%, the
Company is required by GAAP to consolidate TBC de Mexico into the Company's
consolidated financial statements, and the Company's equity investment in TBC de
Mexico exceeds $2,500.000.

     "SUBSIDIARY OBLIGOR" shall mean each of the Original Subsidiary Obligors
and any Subsidiary which delivers to each of the holders of Notes an amendment
to the Guarantee and Collateral Agreement in compliance with Section 5.6 hereof.

     "SUNTRUST SALE AND LEASEBACK" means the sale for a price not to exceed
$12,000,000 and the leasing back of up to fourteen retail stores currently owned
by Merchant's, Incorporated.

                                       57
<PAGE>

     "SYNTHETIC LEASE" means any lease entered into by Big O or Big O
Development, Inc. (each a "Lessee") pursuant to the existing $15,000,000 lease
program with SunTrust Capital Markets, Inc. ("SunTrust") contemplated by that
certain Master Agreement, dated as of December 2, 1998, among the Lessees,
SunTrust, the Company, and the Atlantic Financial Group, Ltd., as from time to
time amended.

     "TIRE KINGDOM" means Tire Kingdom, Inc., a Florida corporation.

     "TITLE INSURANCE COMPANY" shall have the meaning specified in Section
5.9(a).

     "TRANSFEREE" shall mean any direct or indirect transferee of all or any
part of any Note.

     "2003 NOTE CLOSING DATE" shall mean the date of the Closing (as such term
is defined in the 2003 Note Purchase Agreement).

     "2003 NOTE PURCHASE AGREEMENT" means the Note Purchase Agreement, of even
date herewith, by and among the Company and the note purchasers party thereto,
as amended, restated, supplemented, replaced or otherwise modified from time to
time.

     "2003 NOTES" means the Series D Variable Rate Senior Notes, due April 16,
2009, issued by the Company on April 16, 2003 under the terms of the 2003 Note
Purchase Agreement.

     "USA PATRIOT ACT" means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT)
Act of 2001 of the United States of America.

     "VOTING STOCK" shall mean, with respect to any corporation, any shares of
stock of such corporation whose holders are entitled under ordinary
circumstances to vote for the election of directors of such corporation
(irrespective of whether at the time stock of any other class or classes shall
have or might have voting power by reason of the happening of any contingency).

     "WHOLLY-OWNED SUBSIDIARY" shall mean, as to any Person, (a) any Subsidiary
all of whose outstanding Voting Stock is at the time owned directly by such
Person (including any Subsidiary all of whose outstanding Voting Stock is at the
time owned directly or indirectly by one of such Person's Wholly-Owned
Subsidiaries) or (b) any partnership, limited liability company, association,
joint venture or similar business organization of which 100% of the ownership
interests having ordinary voting power are at the time so owned.

                                       58
<PAGE>

     10.3. ACCOUNTING PRINCIPLES, TERMS AND DETERMINATIONS. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
determinations with respect to accounting matters hereunder shall be made, and
all unaudited financial statements and certificates and reports as to financial
matters required to be furnished hereunder shall be prepared, in accordance with
GAAP applied on a basis consistent with the most recent audited financial
statements delivered pursuant to clause (b) of Section 5.1 or, if no such
statements have been so delivered, the most recent audited financial statements
referred to in clause (i) of Section 8.2.

11.  MISCELLANEOUS.

     11.1. NOTE PAYMENTS. The Company agrees that, so long as Prudential shall
hold any Note, it will make payments of principal of, interest on, and any
Yield-Maintenance Amount payable with respect to, such Note, by wire transfer of
immediately available funds for credit (not later than 12:00 noon, New York City
local time, on the date due) to (i) the account or accounts of Prudential
specified in the Purchaser Schedule attached hereto or (ii) such other account
or accounts in the United States as Prudential may from time to time designate
in writing, notwithstanding any contrary provision herein or in any Note with
respect to the place of payment. Prudential agrees that, before disposing of any
Note, it will make a notation thereon (or on a schedule attached thereto) of all
principal payments previously made thereon and of the date to which interest
thereon has been paid. The Company agrees to afford the benefits of this Section
11.1 to any Transferee which shall have made the same agreement as Prudential
has made in this Section 11.1.

     11.2. EXPENSES. The Company agrees to pay, and save Prudential and any
Transferee harmless against liability for the payment of (i) all document
production and duplication charges and the fees and expenses of any special
counsel engaged by Prudential or any Transferee in connection with any
subsequent proposed modification of, or proposed consent under, this Agreement,
whether or not such proposed modification shall be effected or proposed consent
granted, and (ii) the costs and expenses, including attorneys' fees, incurred by
Prudential or any Transferee in enforcing (or determining whether or how to
enforce) any rights under this Agreement or the Notes or in responding to any
subpoena or other legal process or informal investigative demand involving the
Company, any Subsidiary or any Affiliate of any thereof issued in connection
with this Agreement or the transactions contemplated hereby or by reason of
Prudential's or any Transferee's having acquired any Note, including without
limitation costs and expenses incurred in any bankruptcy case involving the
Company, any Subsidiary or any Affiliate of any thereof. The obligations of the
Company under this Section 11.2 shall survive the transfer of any Note or
portion thereof or interest therein by Prudential or any Transferee and the
payment of any Note.

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<PAGE>

     11.3. CONSENT TO AMENDMENTS. This Agreement may be amended, and the Company
may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, if the Company shall obtain the written consent
to such amendment, action or omission to act, of the Required Holder(s) of the
Notes of each Series except that, without the written consent of the holders of
all Notes of a particular Series at the time outstanding, the Notes of such
Series may not be amended or the provisions thereof waived to change the
maturity thereof, to change or affect the principal thereof, or to change or
affect the rate or time of payment of interest on or any Yield-Maintenance
Amount payable with respect to the Notes of such Series, or to change or affect
the provisions of Section 7.1 or this Section 11.3 insofar as such provisions
relate to proportions of the principal amount of the Notes of such Series, or
the rights of any individual holder of Notes of such Series, required with
respect to any declaration of Notes of such Series to be due and payable or with
respect to any consent, amendment, waiver or declaration. Each holder of any
Note at the time or thereafter outstanding shall be bound by any consent
authorized by this Section 11.3, whether or not such Note shall have been marked
to indicate such consent, but any Notes issued thereafter may bear a notation
referring to any such consent. No course of dealing between the Company and the
holder of any Note nor any delay in exercising any rights hereunder or under any
Note shall operate as a waiver of any rights of any holder of such Note. As used
herein and in the Notes, the term "THIS AGREEMENT" and references thereto shall
mean this Agreement as it may from time to time be amended or supplemented.

     11.4. FORM, REGISTRATION, TRANSFER AND EXCHANGE OF NOTES; LOST NOTES. The
Notes are issuable as registered notes without coupons in denominations of at
least $1,000,000, except as may be necessary to reflect any principal amount not
evenly divisible by $1,000,000. The Company shall keep at its principal office a
register in which the Company shall provide for the registration of Notes and of
transfers of Notes. Upon surrender for registration of transfer of any Note of
any Series at the principal office of the Company, the Company shall, at its
expense, execute and deliver one or more new Notes of the same Series, of like
tenor and of a like aggregate principal amount, in the form attached hereto as
Exhibit 1A, Exhibit 1B or Exhibit 1C, as applicable, registered in the name of
such transferee or transferees. At the option of the holder of any Note of any
Series, such Note may be exchanged for other Notes of such Series of like tenor
and of any authorized denominations, of a like aggregate principal amount, upon
surrender of the Note to be exchanged at the principal office of the Company.
Whenever any Notes are so surrendered for exchange, the Company shall, at its
expense, execute and deliver the Notes which the holder making the exchange is
entitled to receive. Each installment of principal payable on each installment
date upon each new Note issued upon any such transfer or exchange shall be in
the same proportion to the unpaid principal amount of such new Note as the
installment of principal payable on such date on the Note surrendered for
registration of transfer or exchange bore

                                       60
<PAGE>

to the unpaid principal amount of such Note. No reference need be made in any
such new Note to any installment or installments of principal previously due and
paid upon the Note surrendered for registration of transfer or exchange. Every
Note surrendered for registration of transfer or exchange shall be duly
endorsed, or be accompanied by a written instrument of transfer duly executed,
by the holder of such Note or such holder's attorney duly authorized in writing.
Any Note or Notes issued in exchange for any Note or upon transfer thereof shall
carry the rights to unpaid interest and interest to accrue which were carried by
the Note so exchanged or transferred, so that neither gain nor loss of interest
shall result from any such transfer or exchange. Upon receipt of written notice
from the holder of any Note of any Series of the loss, theft, destruction or
mutilation of such Note and, in the case of any such loss, theft or destruction,
upon receipt of such holder's unsecured indemnity agreement, or in the case of
any such mutilation upon surrender and cancellation of such Note, the Company
will make and deliver a new Note of such Series, of like tenor, in lieu of the
lost, stolen, destroyed or mutilated Note.

     11.5. PERSONS DEEMED OWNERS; PARTICIPATIONS. Prior to due presentment for
registration of transfer, the Company may treat the Person in whose name any
Note is registered as the owner and holder of such Note for the purpose of
receiving payment of principal of and interest on, and any Yield-Maintenance
Amount payable with respect to, such Note and for all other purposes whatsoever,
whether or not such Note shall be overdue, and the Company shall not be affected
by notice to the contrary. Subject to the preceding sentence, the holder of any
Note may from time to time grant participations in all or any part of such Note
to any Person on such terms and conditions as may be determined by such holder
in its sole and absolute discretion.

     11.6. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT. All
representations and warranties contained herein or made in writing by or on
behalf of the Company in connection herewith shall survive the execution and
delivery of this Agreement and the Notes, the transfer by Prudential of any Note
or portion thereof or interest therein and the payment of any Note, and may be
relied upon by any Transferee, regardless of any investigation made at any time
by or on behalf of Prudential or any Transferee. Subject to the preceding
sentence, this Agreement and the Notes embody the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof and supersede all prior agreements and understandings relating to such
subject matter.

     11.7. SUCCESSORS AND ASSIGNS. All covenants and other agreements in this
Agreement contained by or on behalf of any of the parties hereto shall bind and
inure to the benefit of the respective successors and assigns of the parties
hereto (including, without limitation, any Transferee) whether so expressed or
not, except that the Company may not assign or otherwise transfer any of its
rights or

                                       61
<PAGE>

obligations hereunder without the prior written consent of each holder of Notes
(and any attempted assignment or transfer by the Company without such consent
shall be null and void). Each Transferee, by virtue of having become a holder of
a Note (and with no other action required of any Person), shall also become a
party to the Intercreditor Agreement, with all of the rights and obligations of
a Secured Party (as defined in the Intercreditor Agreement).

     11.8. INDEPENDENCE OF COVENANTS; SEVERABILITY; DESCRIPTIVE HEADINGS. All
covenants hereunder shall be given independent effect so that if a particular
action or condition is prohibited by any one of such covenants, the fact that it
would be permitted by an exception to, or otherwise be in compliance with the
limitations of, another covenant shall not avoid the occurrence of a Default or
Event of Default if such action is taken or such condition exists. Any provision
of this Agreement which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction. The
descriptive headings of the several Sections of this Agreement are inserted for
convenience only and do not constitute a part of this Agreement.

     11.9. NOTICES. All written communications provided for hereunder shall be
sent by first class mail or nationwide overnight delivery service (with charges
prepaid) and (i) if to Prudential, addressed as specified for such
communications in the Purchaser Schedule attached hereto or at such other
address as Prudential shall have specified to the Company in writing, (ii) if to
any other holder of any Note, addressed to it at such address as it shall have
specified in writing to the Company or, if any such holder shall not have so
specified an address, then addressed to such holder in care of the last holder
of such Note which shall have so specified an address to the Company and (iii)
if to the Company, addressed to it at 4770 Hickory Hill Road, Memphis, Tennessee
38141, Attention: Executive Vice President and Treasurer, provided, however,
that any such communication to the Company may also, at the option of the Person
sending such communication, be delivered by any other means either to the
Company at its address specified above or to any Authorized Officer of the
Company.

     11.10. PAYMENTS DUE ON NON-BUSINESS DAYS. Anything in this Agreement or the
Notes to the contrary notwithstanding, any payment of principal of or interest
on, or Yield-Maintenance Amount payable with respect to, any Note that is due on
a date other than a Business Day shall be made on the next succeeding Business
Day, without including the additional days elapsed in the computation of the
interest payable on such next succeeding Business Day.

     11.11. MINIMUM INTEREST PAYABLE. The Company and all holders of the Notes
specifically intend and agree to limit contractually the amount of interest

                                       62
<PAGE>

payable under this Agreement, the Notes and all other instruments and agreements
related hereto and thereto to the maximum amount of interest lawfully permitted
to be charged under applicable law. Therefore, none of the terms of this
Agreement, the Notes or any instrument pertaining to or relating to this
Agreement or the Notes shall ever be construed to create a contract to pay
interest at a rate in excess of the maximum rate permitted to be charged under
applicable law, and neither the Company, any guarantor nor any other party
liable or to become liable hereunder, under the Notes, any guaranty or under any
other instruments and agreements related hereto and thereto shall ever be liable
for interest in excess of the amount determined at such maximum rate, and the
provisions of this Section 11.11 shall control over all other provisions of the
Agreement, any Notes, the Guarantee and Collateral Agreement or any other
guaranty or any other instrument pertaining to or relating to the transactions
herein contemplated. If any amount of interest taken or received by any holder
of a Note shall be in excess of said maximum amount of interest which, under
applicable law, could lawfully have been collected by such holder incident to
such transactions, then such excess shall be deemed to have been the result of a
mathematical error by all parties hereto and shall be refunded promptly by the
Person receiving such amount to the party paying such amount, or, at the option
of the recipient, credited ratably against the unpaid principal amount of the
Note or Notes held by such holder. All amounts paid or agreed to be paid in
connection with such transactions which would under applicable law be deemed
"interest" shall, to the extent permitted by such applicable law, be amortized,
prorated, allocated and spread throughout the stated term of this Agreement and
the Notes. "APPLICABLE LAW" as used in this Section means that law in effect
from time to time which permits the charging and collection of the highest
permissible lawful, nonusurious rate of interest on the transactions herein
contemplated including laws of the State of Tennessee and of the United States
of America, and "MAXIMUM RATE" as used in this Section means, with respect to
each of the Notes, the maximum lawful, nonusurious rates of interest (if any)
which under applicable law may be charged to the Company from time to time with
respect to such Notes.

     11.12. CONSENT TO JURISDICTION; WAIVER OF IMMUNITIES. The Company hereby
irrevocably submits to the jurisdiction of any New York state or federal court
sitting in New York in any action or proceeding arising out of or relating to
this Agreement, and the Company hereby irrevocably agrees that all claims in
respect of such action or proceeding may be heard and determined in New York
state or federal court. The Company hereby irrevocably waives, to the fullest
extent it may effectively do so, the defense of an inconvenient forum to the
maintenance of such action or proceeding. The Company agrees and irrevocably
consents to the service of any and all process in any such action or proceeding
by the mailing, by registered or certified U.S. mail, or by any other means or
mail that requires a signed receipt, of copies of such process to CT Corporation
System at 111 Eighth Avenue, 13th Floor, New York, New York, 10011. The Company
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other

                                       63
<PAGE>

jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Section 11.12 shall affect the right of any holder of Notes to
serve legal process in any other manner permitted by law or affect the right of
any such holder to bring any action or proceeding against the Company or its
property in the courts of any other jurisdiction. To the extent that the Company
has or hereafter may acquire immunity from jurisdiction of any court or from any
legal process (whether through service of notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to itself
or its property, the Company hereby irrevocably waives such immunity in respect
of its obligations under this agreement.

     11.13. SATISFACTION REQUIREMENT. If any agreement, certificate or other
writing, or any action taken or to be taken, is by the terms of this Agreement
required to be satisfactory to Prudential, to any holder of Notes or to the
Required Holder(s), the determination of such satisfaction shall be made by
Prudential, such holder or the Required Holder(s), as the case may be, in the
sole and exclusive judgment (exercised in good faith) of the Person or Persons
making such determination.

     11.14. GOVERNING LAW. IN ACCORDANCE WITH THE PROVISIONS OF SS.5-1401 OF THE
NEW YORK GENERAL OBLIGATIONS LAW, THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE
INTERNAL LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY OF ITS CONFLICTS OF
LAWS PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A DIFFERENT
JURISDICTION.

     11.15. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.

     11.16. BINDING AGREEMENT. When this Agreement is executed and delivered by
the Company and Prudential, it shall become a binding agreement between the
Company and Prudential.

                      [SIGNATURES APPEAR ON THE NEXT PAGE.]

                                       64
<PAGE>

     If this Agreement is satisfactory to you, please so indicate by signing the
acceptance at the foot of a counterpart hereof and returning such counterpart to
the Company, whereupon this Agreement shall become binding among us in
accordance with its terms.

                                        Very truly yours,

                                        TBC CORPORATION

                                        By: /s/ Lawrence C. Day
                                            ------------------------------------
                                            Name: Lawrence C. Day
                                            Title: President and Chief Executive
                                                   Officer

The foregoing Agreement is
hereby accepted as of the
date first above written.

THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA

By: /s/ Robert R. Derrick
    -------------------------------
    Name: Robert R. Derrick
    Title: Vice President

             [Signature Page to Amended and Restated Note Agreement]

<PAGE>

                               PURCHASER SCHEDULE

--------------------------------------------------------------------------------
PURCHASER NAME                     THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
--------------------------------------------------------------------------------
Name in Which Note is Registered   THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
--------------------------------------------------------------------------------
Note Registration Number;          Series A:  $19,500,000
Principal Amount                   Series B:  $11,000,000
                                   Series C:  $16,500,000
--------------------------------------------------------------------------------
Payment on Account of Note

         Method                    Federal Funds Wire Transfer
         Account Information       The Bank of New York
                                   New York, NY
                                   ABA#: 021-000-018
                                   Account No.: 890-0304-391
                                   Ref: See "Accompanying Information" below

--------------------------------------------------------------------------------
Accompanying Information           Name of Issuer: TBC CORPORATION

                                   Description of Security:  Series A Senior
                                   Notes due July 10, 2003

                                   PPN: 872180 B*4

                                   Description of Security: Series B Senior
                                   Notes due July 10, 2005

                                   PPN: 872180 B@2

                                   Description of Security: Series C Senior
                                   Notes due July 10, 2008

                                   PPN: 872180 B#0

                                   Due Date and Application (as among principal,
                                   interest and Yield-Maintenance Amount) of
                                   the payment being made:

--------------------------------------------------------------------------------

<PAGE>
PURCHASER NAME                     THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
--------------------------------------------------------------------------------
Address for Notices Related        The Prudential Insurance Company of America
to Payments                        C/o Investment Operations Group
                                   Gateway Center Two, 10th Floor
                                   100 Mulberry Street
                                   Newark, NJ 07102-4077
                                   Attn: Manager, Billings and Collections
                                   Fax: 973-802-8764

                                   For Prepayment Notices:
                                   Manager, Trade Management Group
                                   Tel: 973-802-8107
                                   Fax: 973-802-9425

--------------------------------------------------------------------------------
Address for All other Notices      The Prudential Insurance Company of America
(including copies of all           C/o Prudential Capital Group
Notices related to Payments)       1170 Peachtree Street, Suite 500
                                   Atlanta, GA 30309
                                   Attn: Managing Director
                                   Tel: 404-870-3750
                                   Fax: 404-870-2041

--------------------------------------------------------------------------------
Signature Block Format             THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
                                   By:
                                      ------------------------------
                                   Name:
                                   Title:

--------------------------------------------------------------------------------
Instructions re Delivery of        The Prudential Insurance Company of America
Notes                              1114 Avenue of the Americas
                                   30th Floor
                                   New York, NY 10036
                                   Attn: Philip Corsello, Esq.

--------------------------------------------------------------------------------
Tax Identification Number          22-1211670
--------------------------------------------------------------------------------

<PAGE>

                                                                   SCHEDULE 5.15

                           CERTAIN INTERCOMPANY LOANS
                           --------------------------

Provided that no Event of Default has occurred and is continuing, payments on
Intercompany Loans owed to the Company by the following Subsidiaries may be made
without regard to the financial condition or solvency of the Subsidiary:

                                        Northern States Tire, Inc.
                                        Big O Development, Inc.

<PAGE>

                                                                 SCHEDULE 6.2(b)

                      EXISTING INDEBTEDNESS AND GUARANTEES
                      ------------------------------------

Those Guarantees listed on Schedule 6.2(e).

TBC Corporation has guaranteed a $1,500,000 line of credit made available to TBC
de Mexico and TBC International Inc. by First Tennessee Bank National
Association.

TBC Corporation has guaranteed all obligations of Big O Retail Enterprises,
Inc., Tire Kingdom, Inc., Big O Tires, Inc., and Carroll's, Inc., and expects to
guarantee all obligations of Merchant's Incorporated, to Michelin North America,
Inc. and its affiliates.

TBC Corporation has guaranteed all obligations of Tire Kingdom, Inc. to
Continental General Tire, Inc.

Capital Lease relating to the Salt Lake City Warehouse of Big O Tires, Inc.
(book value as of 2/28/03 is $1,162,666).

<PAGE>

                                                                 SCHEDULE 6.2(e)

           GUARANTEE OBLIGATIONS OF BIG O TIRES, INC. AND SUBSIDIARIES
           -----------------------------------------------------------

                                             Big O Guarantee Portion at 12/31/02
                                             -----------------------------------

The CIT Group
         Intermountain Realty -Colorado Springs                   $   411,995.64
         Intermountain Realty - Sioux Falls                           380,757.97

Merrill Lynch
         Loan portfolio (sold 6/30/97,9/30/97,12/31/98)                92,956.28

GE Capital
         Las Vegas                                                  2,787,922.87
         Las Vegas                                                    394,156.28
         82nd St. Oregon                                              247,277.12
         Boulder, CO                                                   48,917.50

OKC, LLC JV                                                           150,000.00

Real Estate Lease Guarantees                                        1,315,240.18

Synthetic Lease                                                     8,757,896.38
                                                                  --------------

Total Guarantees                                                  $14,587,120.22

<PAGE>

                                                                    SCHEDULE 6.3

                                 EXISTING LIENS
                                 --------------

     Liens arising under the Guarantee and Collateral Agreement.

     Numerous UCC financing statements evidencing operating lease transactions
     in which TBC Corporation and its Subsidiaries are lessees have been filed
     and are still in effect.

UCC Filings and Mortgages Against Big O Tires, Inc. and Its Subsidiaries:
-------------------------------------------------------------------------

     The Bank of Cherry Creek, N.A., as Indenture Trustee.
     Security interests and mortgages granted in connection with 8.71% Senior
     Secured Notes in the aggregate original principal amount of $8,000,000
     issued by Big O Tires, Inc. in 1994. Notes were paid in full in 1999, and
     Big O Tires, Inc. has tried on numerous occasions, without success, to
     obtain termination statements for various UCC filings relating thereto.

     The CIT Group/Equipment Financing, Inc.
     Filings in connection with sales of franchisee notes receivable.

     SunTrust Bank, as Agent.
     Filings in connection with Synthetic Leases.

     First National Bank of Dieterich.
     Filing in connection with equipment financing by Big O Tire of Idaho, Inc.

     Steve W. Mead
     Filing to evidence consigned Interstate Battery System of America
     inventory.

UCC Filings Against Tire Kingdom, Inc.:
-------------------------------------

     Michelin North America, Inc. and related entities.
     Purchase money security interest filing against all inventory purchased
     from secured party by Tire Kingdom and all proceeds therefrom.

UCC Filings Against Merchant's, Incorporated or Merban, Inc.:
------------------------------------------------------------

     Bridgestone/Firestone, Inc.
     Consigned inventory of the secured party.

     Kimco Select Investments
     Blanket security interest filed by secured party; debt has been discharged
     and secured party to release Liens promptly after the closing of the
     Merchant's Acquisition.

<PAGE>

     CIT Group/Business Credit, Inc.
     Mortgages and blanket security interest filed by secured party; debt has
     been discharged and secured party to release mortgages and Liens promptly
     after the closing of the Merchant's Acquisition.

     Michelin North America, Inc. and related entities
     Mortgages and security interests filed by secured party, who has agreed to
     release the same promptly after the closing of the Merchant's Acquisition.

     SunTrust Bank
     Blanket security interest filed by secured party; debt has been discharged
     and secured party to release Liens promptly after the closing of the
     Merchant's Acquisition.

     Bandag, Incorporated
     Liens relating to Bandag equipment and related collateral used in the
     retreading operations of Merban.

<PAGE>

                                                                 SCHEDULE 6.5(b)

                     CERTAIN EXISTING INVESTMENTS AND LOANS
                     --------------------------------------

-    See Exhibit A to this Schedule 6.5(b) for a listing of all existing
     Subsidiaries.

-    TBC Corporation owns 40% of STI Acquisition LLC, a Nevada limited liability
     company.

-    TBC Corporation owns 20,000 shares of Series A Preferred Stock, $.01 par
     value, of Quirk Automotive, Corp. and 14.4 shares of Common Stock, $100 par
     value, of V.I.P., Inc. (total investment - $5,000,000).

-    TBC International Inc. owns approximately 49% of the ownership interests in
     TBC de Mexico, S.A. de C.V., a Mexican company.

-    Big O Retail Enterprises, Inc. is a 50% shareholder in Tires Industries
     Corporation, a Utah corporation.

-    Big O Development, Inc. loaned Betsy Paulsen Tufts $297,000 on October 10,
     1994. At 12/31/02, the balance on the promissory note relating thereto was
     $122,483.

-    Carroll's, Inc. owns 50 shares of stock of The Hercules Tire & Rubber
     Company.

-    Carroll's Inc. owns 360 shares of stock of Carmerica, Inc.

-    Big O Tires, Inc. holds a 50% interest in each of the following joint
     ventures:

       BORE/MPC, LLC (a Missouri LLC).
       Big O/Stephenson Joint Venture LLC (a Nevada LLC).
       OKC, LLC (a Colorado LLC).
       Intermountain Development Joint Venture (a Colorado general partnership).
       One Stop Undercar Denver, LLC (a Colorado LLC)

<PAGE>

                                                                    EXHIBIT A TO
                                                                 SCHEDULE 6.5(b)

           COMPANY AND SUBSIDIARIES AND JURISDICTIONS OF ORGANIZATION
           ----------------------------------------------------------

COMPANY: TBC Corporation, a Delaware corporation ("TBC")

SUBSIDIARIES DIRECTLY OWNED BY TBC:

<TABLE>
<CAPTION>

                                   JURISDICTION OF      PERCENTAGE OF STOCK/
           NAME                     ORGANIZATION        EQUITY OWNED BY TBC         SUBSIDIARIES
           ----                     ------------        -------------------         ------------
<S>                                    <C>                      <C>                 <C>

Big O Tires, Inc.                      Nevada                   100%                  See Below
Carroll's, Inc.                        Georgia                  100%                       None
Northern States Tire, Inc.             Delaware                 100%                       None
TBC International Inc.                 Delaware                 100%                       None
TBC Retail Enterprises, Inc.           Delaware                 100%                  See Below
TBC Brands, LLC                        Delaware                 100%                       None
TBC Capital, LLC                       Delaware                  90%*                      None

</TABLE>

   *5% is owned by each of Carroll's, Inc. and Tire Kingdom, Inc.

SUBSIDIARIES DIRECTLY OWNED BY BIG O TIRES, INC.:

<TABLE>
<CAPTION>
                                   JURISDICTION OF      PERCENTAGE OF STOCK
           NAME                     INCORPORATION         OWNED BY BIG O            SUBSIDIARIES
           ----                    ---------------      -------------------         ------------
<S>                                    <C>                      <C>                 <C>

Big O Development, Inc.                  Colorado               100%                    None
O Advertising, Inc.                      Colorado               100%                    None
Big O Tire of Idaho, Inc.                Idaho                  100%                    None
</TABLE>

SUBSIDIARIES DIRECTLY OWNED BY TBC RETAIL ENTERPRISES, INC.:
-----------------------------------------------------------

<TABLE>
<CAPTION>
                                   JURISDICTION OF      PERCENTAGE OF STOCK
           NAME                     INCORPORATION       OWNED BY TBC RETAIL         SUBSIDIARIES
           ----                    ---------------      -------------------         ------------
<S>                                    <C>                      <C>                 <C>

Big O Retail Enterprises, Inc.          Colorado                100%                    None
Tire Kingdom, Inc.                      Florida                 100%                  See Below

</TABLE>

<PAGE>

SUBSIDIARIES DIRECTLY OWNED BY TIRE KINGDOM, INC.:
-------------------------------------------------

<TABLE>
<CAPTION>
                                   JURISDICTION OF      PERCENTAGE OF STOCK
           NAME                     INCORPORATION           OWNED BY TKI            SUBSIDIARIES
           ----                    ---------------      -------------------         ------------
<S>                                <C>                  <C>                         <C>

Merchant's, Incorporated              Delaware                  100%                 See Below

</TABLE>

SUBSIDIARIES DIRECTLY OWNED BY MERCHANT'S, INCORPORATED:
-------------------------------------------------------

<TABLE>
<CAPTION>
                                   JURISDICTION OF      PERCENTAGE OF STOCK
           NAME                     INCORPORATION           OWNED BY TKI            SUBSIDIARIES
           ----                    ---------------      -------------------         ------------
<S>                                <C>                  <C>                         <C>

Merban, Inc.                          Virginia                100%                     None

</TABLE>

<PAGE>

                                                                    SCHEDULE 6.8

                              EXISTING RESTRICTIONS
                              ---------------------

The documents evidencing the Credit Agreement contain restrictions and
conditions of the type described in Section 6.8.

The Synthetic Leases contain restrictions and conditions of the type described
in Section 6.8.

It is expected that the documents evidencing the SunTrust Sale and Leaseback
will contain restrictions and conditions of the type described in Section 6.8.

<PAGE>

                                                                   SCHEDULE 6.10

                         CERTAIN DISPOSITIONS OF ASSETS
                         ------------------------------

                                      NONE.

<PAGE>

                                                                    SCHEDULE 8.7

                             CONFLICTING AGREEMENTS
                             ----------------------

         See Schedule 6.8.

<PAGE>

                                                                   SCHEDULE 8.13

                    TRADEMARKS, TRADENAMES AND SERVICE MARKS
                    ----------------------------------------

<TABLE>
<CAPTION>
                                                            TIRE KINGDOM, INC.

     Trademark Report by Mark                                                                    Printed: 3/28/2003         Page 1
     Status:  ACTIVE
     COUNTRY                                        FILED       APPL#             REGDT        REG#           STATUS        CLASSES

    <S>                                           <C>         <C>               <C>          <C>             <C>            <C>
     MISCELLANEOUS [CROWN] DESIGN

     UNITED STATES                                9/1/1999    75/791,760        6/27/2000    2,363,324       REGISTERED        35

     TIRE KINGDOM

     UNITED STATES                                2/5/2003    76/487,769                                     PENDING           35

     UNITED STATES                                12/10/1992  74/338,671        5/31/1994    1,838,215       REGISTERED        42

     TIRE KINGDOM & DESIGN

     UNITED STATES                                2/5/2003    76/487,604                                     PENDING           35

                                                            END OF                             TOTAL ITEMS SELECTED =           4

                                                                BIG O TIRES, INC.

      Trademark Report by Mark                                                                   Printed: 3/28/2003         Page 1
      Status:  ACTIVE
      COUNTRY                                        FILED      APPL#             REGDT        REG#           STATUS        CLASSES

     A REPUTATION YOU CAN RIDE ON
     UNITED STATES                                2/22/1993   74/360,838        7/19/1994    1,845,544       REGISTERED     37,42

     ASPEN
     UNITED STATES                                3/25/1988   73/718,614        10/11/1988   1,508,041       REGISTERED        12

     BIG FOOT
     CANADA                                       3/15/1988   602897            3/13/1992    395398          REGISTERED         A

     MEXICO                                       5/15/1998   332727            10/20/2000   674604          REGISTERED        12

     UNITED STATES                                5/7/1993    74/389,931        7/11/1995    1,904,955       REGISTERED        12

     BIG FOOT 60
     UNITED STATES                                9/6/1974    73/031,264        9/12/1978    1,102,058       REGISTERED        12

     BIG FOOT 70
     UNITED STATES                                9/16/1974   73/031,311        9/12/1978    1,102,059       REGISTERED        12

     BIG HAUL
     UNITED STATES                                10/3/1974   73/033,736        8/26/1975    1,018,800       REGISTERED        12

     BIG LIFT
</TABLE>

<PAGE>

<TABLE>
    <S>                                           <C>         <C>               <C>          <C>             <C>           <C>
     CANADA                                       3/9/1998    871625                                         ALLOWED              37

     UNITED STATES                                9/17/1997   75/358,399        12/18/2001   2,520,443       REGISTERED        35,37

     BIG O
     MEXICO                                       5/15/1998   332726            10/20/2000   674603          REGISTERED           12

     TEXAS                                        9/2/1982    N/A               9/2/1982     40704           REGISTERED           12

     TEXAS                                        11/1/1982   40967             11/1/1982    40967           REGISTERED           42

     UNITED STATES                                1/14/1974   73/010,921        9/24/1974    993,415         REGISTERED           12

     UNITED STATES                                9/10/1973   73/000,572        10/1/1974    994,466         REGISTERED           42

     BIG O TIRES
     CANADA                                       6/18/1987   586384            10/27/1989   361490          REGISTERED          N/A

     CANADA                                       5/5/1999    1,014,484         2/21/2002    TMA558285       REGISTERED     12,35,37

     MEXICO                                       5/15/1998   332728            10/20/2000   674605          REGISTERED           42

     UNITED STATES                                4/12/1999   75/679,597        12/12/2000   2,411,926       REGISTERED     12,35,37

     BIG O TIRES & DESIGN
     CANADA                                                                     6/12/1981    259,938         REGISTERED          N/A

     CANADA                                       3/27/1991   682687            11/12/1993   TMA419439       REGISTERED          N/A

     BIG O TIRES AND DESIGN
     UNITED STATES                                12/4/1989   74/007,344        8/28/1990    1,611,160       REGISTERED        12,42

     COST U LESS & DESIGN
     CANADA                                       8/5/1994    761237            10/28/1997   TMA484761       REGISTERED         A,Aa

     MEXICO                                       8/9/1994    207912            10/11/1994   476693          REGISTERED         37,A

     MEXICO                                       8/9/1994    207911            10/5/1994    476099          REGISTERED           42

     COSTULESS & DESIGN
     UNITED STATES                                7/12/1994   74/548,947        1/30/1996    1,952,457       REGISTERED   12, 37, 42

     DARE TO COMPARE
     UNITED STATES                                4/20/2000   76/030,453        9/25/2001    2,492,236       REGISTERED          035

     DESIGN OF BIG FOOT
     CANADA                                       5/5/1999    1,014,482         3/15/2001    TMA542,415      REGISTERED     12,35,37

     UNITED STATES                                4/12/1999   75/680,850        2/1/2000     2,314,775       REGISTERED     12,35,37

     EURO TOUR
     CANADA                                       1/15/2003   1164833                                        PENDING              12

     MEXICO                                       2/3/2003    586480                                         PENDING              12

     UNITED STATES                                11/8/2002   76/468,502                                     PENDING              12

     EXTRA CARE & DESIGN
     UNITED STATES                                3/24/1986   589,583           11/18/1986   1,417,730       REGISTERED           37

     UNITED STATES                                3/24/1986   73/589,583        11/18/1986   1,417,730       REGISTERED           37

     HYDRO-TRAC
</TABLE>

<PAGE>

<TABLE>
    <S>                                           <C>         <C>               <C>          <C>             <C>          <C>

     MEXICO                                       1/14/1994   188025            5/4/1994     459327          REGISTERED           12

     LEGACY
     CANADA                                       3/15/1988   602896            3/13/1992    395397          REGISTERED          N/A

     COLORADO                                     10/28/1985  N/A               10/28/1985   T29645          REGISTERED           35

     COLORADO                                                                   4/22/1976    T30670          REGISTERED

     MEXICO                                       1/14/1994   188026            5/4/1994     459328          REGISTERED           12

     UNITED STATES                                10/31/1985  73/566,064        5/20/1986    1,393,967       REGISTERED           12

     LIGHTENING
     MEXICO                                       1/14/1994   188027            12/6/1994    481629          REGISTERED        12,35

     PATHMAX
     UNITED STATES                                8/3/1998    75/529,550        9/28/1999    2,281,419       REGISTERED           12

     PROCOMP
     MEXICO                                       1/14/1994   188028            5/4/1994     459329          REGISTERED       12, 35

     PROCOMP HIGH PERFORMANCE
     UNITED STATES                                7/27/1992   74/298,320        7/5/1994     1,842,854       REGISTERED           12

     SASQUATCH [BIG FOOT] DESIGN
     CANADA                                       5/5/1999    1,014,483         1/16/2003    tma573769       REGISTERED     12,35,37

     SONIC COMMERICAL
     UNITED STATES                                12/2/1964   72/207,339        3/15/1966    805,578         REGISTERED           12

     SUN VALLEY
     UNITED STATES                                10/31/1968  72/310,988        6/17/1969    871,318         REGISTERED           35

     VENGEANCE
     CANADA                                       1/2/2003    N/A                                            PENDING

     MEXICO                                       1/7/2003    582675                                         PENDING

     UNITED STATES                                10/18/2002  76/460,700                                     PENDING              12

     WWW.BIGOTIRES.COM & DESIGN
     CANADA                                       3/20/2001   1096649                                        PENDING

     MEXICO                                       3/29/2001   478565            8/30/2001    713395          REGISTERED           37

     MEXICO                                       3/29/2001   478566                                         PENDING              42

     UNITED STATES                                12/1/2000   76/174,243        12/4/2001    2,514,975       REGISTERED       35, 37

                                                            END OF                                TOTAL ITEMS SELECTED =          63
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                                                  TBC BRANDS, LLC

     Trademark Report by Mark                                                                Printed: 3/28/2003              Page 1
     Status:  ACTIVE
     COUNTRY                                     FILED      APPL#              REGDT        REG#            STATUS         CLASSES
    <S>                                           <C>         <C>               <C>          <C>           <C>            <C>
     AQUA FLOW
     CANADA                                       3/9/1993    724,287           7/15/1994    430478        REGISTERED        N/A

     JAPAN                                        8/25/1993   87543/93          7/31/1996    3183343       REGISTERED         12

     MEXICO                                       3/24/1993   163889            8/3/1993     438707        REGISTERED         12

     UNITED STATES                                11/24/1992  74/334,184        1/4/1994     1,815,411     REGISTERED         12

     AQUA FLOW III
     CANADA                                       2/5/2001    1091561                                      ALLOWED

     MEXICO                                       3/13/2001   475492            5/24/2001    699369        REGISTERED

     UNITED STATES                                9/13/2000   76/128,049        4/2/2002     2,557,298     REGISTERED         12

     BROADWAY CLASSIC

     UNITED STATES                                12/4/2002   76/472,568                                   PENDING            12

     CENTRED
     CANADA                                       2/19/1999   1006129           10/18/2000   TMA535,038    REGISTERED         12

     MEXICO                                       4/23/1999   372561            2/29/2000    644642        REGISTERED         12

     UNITED STATES                                1/15/1999   75/621,314        3/20/2001    2,437,511     REGISTERED         12

     CENTRON
     UNITED STATES                                3/12/1985   73/526,552        9/3/1985     1,357,941     REGISTERED         12

     CENTURY
     CANADA                                       9/10/1999   1,028,617         11/22/2002   TMA571137     REGISTERED        N/A

     UNITED STATES                                7/30/1999   75/764,830        7/17/2001    2,470,426     REGISTERED         12

     CORDOVAN
     CANADA                                       3/8/1990    652,673           4/5/1991     382741        REGISTERED         12

     CHINA                                        6/28/2002   3225736                                      PENDING            12

     EUROPEAN UNION                               12/30/1997  719351            4/7/1999     000719351     REGISTERED       9,12

     FRANCE                                       4/25/1991   282653            4/25/1991    1657817       REGISTERED       9,12

     GERMANY                                      4/30/1991   T 31 825/12 W     7/14/1992    2017105       REGISTERED       9,12

     MEXICO                                       12/19/1997  318673            2/27/1998    571618        REGISTERED         12

     SOUTH KOREA                                  6/28/2002   2002-30152                                   PENDING            12

     UNITED KINGDOM                               4/24/1991   1462329           4/24/1991    1462329       REGISTERED         12

     UNITED KINGDOM                               5/21/1991   1464865           5/21/1991    1464865       REGISTERED          9

     UNITED STATES                                9/27/1985   73/560,572        12/2/1986    1,419,104     REGISTERED      12,17

     UNITED STATES                                6/15/1945   72/159,045        8/27/1963    755,493       REGISTERED         35
</TABLE>

<PAGE>

<TABLE>

    <S>                                           <C>         <C>               <C>          <C>          <C>            <C>
     CORDOVAN BONNEVILLE JET (STYLIZED)
     UNITED STATES                                5/19/1964   72/193,756        2/9/1965     784,838       REGISTERED         35

     CORDOVAN RADIAL G/T
     UNITED STATES                                11/29/1976  73/108,055        9/19/1978    1,102,631     REGISTERED         12

     CORDOVAN WIDE 600
     UNITED STATES                                8/30/1967   72/279,376        8/6/1968     854,177       REGISTERED         35

     CRITERION
     UNITED STATES                                2/29/1980   73/252,026        9/15/1981    1,169,191     REGISTERED         12

     EPIC
     CANADA                                       6/13/2000   1,063,059         8/7/2002     TMA565594     REGISTERED        N/A

     MEXICO                                       1/4/1995    220948            3/28/1995    486515        REGISTERED         12

     UNITED STATES                                9/10/1985   73/559,173        4/8/1986     1,388,996     REGISTERED         12

     EXCEL
     CANADA                                       9/10/1999   1,028,616                                    ALLOWED           N/A

     UNITED STATES          T30505US0             7/30/1999   75/764,829        7/17/2001    2,470,425     REGISTERED         12

     FRONT LINE & DESIGN
     UNITED STATES                                5/7/1985    73/536,361        11/5/1985    1,368,849     REGISTERED         12

     FRONTLINE
     MEXICO                                       10/21/1994  216047            8/30/1995    502347        REGISTERED         12

     GRAN ESPRIT
     EUROPEAN UNION                               9/19/1996   385617            8/28/1998    385617        REGISTERED         12

     UNITED STATES                                5/20/1996   75/107,105        4/14/1998    2,151,303     REGISTERED         12

     GRAND AM
     CANADA                                       12/29/1994  772,065           6/14/1996    459411        REGISTERED         12

     MEXICO                                       10/13/1994  215380            11/22/1994   480234        REGISTERED         12

     GRAND PRIX
     CANADA                                       10/26/1993  739674            3/16/1999    TMA509,415    REGISTERED        N/A

     MEXICO                                       11/8/1993   182542                                       PENDING            12

     MEXICO                                       8/30/1994   210274            11/18/1994   479812        REGISTERED          7

     UNITED STATES                                5/5/1980    73/260,923        12/29/1981   1,183,571     REGISTERED         11

     UNITED STATES                                10/26/1982  73/400,864        11/22/1983   1,258,438     REGISTERED          9

     UNITED STATES                                12/12/1975  73/071,592        10/25/1977   1,075,901     REGISTERED         12

     UNITED STATES                                8/24/1987   73/680,289        8/27/1991    1,655,035     REGISTERED         37

     GRAND PRIX & DESIGN
     UNITED STATES                                3/17/1982   73/355,136        1/18/1983    1,224,147     REGISTERED         12

     UNITED STATES                                3/25/1959   72/070,188        12/22/1959   690,249       REGISTERED         35

     GRAND PRIX RADIAL G/T (STYLIZED)
</TABLE>

<PAGE>

<TABLE>

    <S>                                           <C>         <C>               <C>          <C>             <C>            <C>
     UNITED STATES                                5/5/1980    73/260,924        8/11/1981    1,164,594     REGISTERED         12

     GRAND SPIRIT
     MEXICO                                       7/24/1995   238249                                       PENDING            12

     UNITED STATES                                1/24/1994   74/481,579        2/27/1996    1,958,273     REGISTERED         12

     GRAND SPIRIT TOURING LS

     UNITED STATES                                12/4/2002   76/472,572                                   PENDING            12

     GRAND SPORT
     CANADA                                       4/12/1990   654,898           3/6/1992     TMA 395,089   REGISTERED         12

     MEXICO                                       1/4/1995    220944            4/23/1997    546167        REGISTERED         12

     UNITED STATES                                5/13/1986   73/598,547        12/23/1986   1,421,825     REGISTERED         12

     HARVEST KING
     CANADA                                       12/29/1994  772,070           1/19/1996    TMA452894     REGISTERED         12

     CHINA                                        1/30/2002   3084124                                      ALLOWED            12

     MEXICO                                       10/13/1994  215383            7/21/1995    497846        REGISTERED         12

     SOUTH KOREA                                  6/28/2002   2002-31154                                   PENDING

     UNITED STATES                                6/19/1989   73/807,530        5/8/1990     1,595,216     REGISTERED         12

     HIGHWAY SCOUT RADIAL HTP
     UNITED STATES                                3/17/2000   76/004,068        4/9/2002     2,559,952     REGISTERED         12

     LIVE ONE (STYLIZED)
     UNITED STATES                                8/10/1976   73/096,101        12/13/1977   1,079,273     REGISTERED         9

     MATRIX
     BRAZIL                                       10/25/1999  822129833                                    PENDING

     UNITED STATES                                3/13/1985   73/562,619        3/1/1988     1,478,574     REGISTERED         12

     MILEAGE MASTER
     UNITED STATES                                3/12/2003   76/497,354                                   PENDING

     MULTI-MILE
     CANADA                                       2/29/2000   654903(1)         4/12/1991    TMA383056     REGISTERED         12
     CHINA                                        6/28/2002   3225735                                      PENDING            12

     EUROPEAN UNION                               12/30/1997  719260            4/7/1999     000719260     REGISTERED       9,12

     FRANCE                                       4/24/1991   282446            4/2/1991     1657653       REGISTERED       9,12

     MEXICO                                       3/24/1993   163887            7/3/1993     438706        REGISTERED         12

     MEXICO                                       10/21/1994  216045            3/22/1995    485680        REGISTERED          9

     SOUTH KOREA                                  6/28/2002   2002-30153                                   PENDING

     UNITED KINGDOM                               4/23/1991   1462051           4/23/1991    B1462051      REGISTERED         12

     UNITED KINGDOM                               5/21/1991   1464866           5/21/1991    B1464866      REGISTERED          9

     UNITED STATES                                8/23/1982   73/381,561        11/29/1983   1,259,363     REGISTERED         12

     UNITED STATES                                5/15/1998   75/485,588        8/3/1999     2,266,907     REGISTERED         12

     MULTI-MILE (STYLIZED)
</TABLE>

<PAGE>

<TABLE>

    <S>                                           <C>         <C>               <C>          <C>           <C>            <C>
     UNITED STATES                                5/11/1950   71/597,256        6/24/1952    560,428       REGISTERED         12

     MULTI-MILE RADIAL G/T (STYLIZED)
     UNITED STATES                                11/29/1976  73/108,056        9/18/1979    1,125,174     REGISTERED         12

     MULTI-MILE WIDE `600'
     UNITED STATES                                8/30/1967   72/279,377        8/6/1968     854,178       REGISTERED         35

     MULTI-TRAC
     MEXICO                                       10/13/1994  215381            7/19/1995    497555        REGISTERED         12

     UNITED STATES                                3/22/1973   72/452,297        3/26/1974    981,104       REGISTERED         35

     POWER KING
     CANADA                                       4/12/1990   654,907           4/5/1991     382759        REGISTERED         12

     CHINA                                        1/30/2002   3084106                                      ALLOWED            12

     MEXICO                                       6/11/1998   336096                                       PENDING            12

     SOUTH KOREA                                  6/28/2002   2002-30155                                   PENDING            12

     UNITED STATES                                4/5/1979    73/210,451        7/29/1980    1,138,319     REGISTERED         12

     POWER KING (STYLIZED)
     UNITED STATES                                2/7/1983    73/412,703        4/3/1984     1,272,524     REGISTERED          9

     POWER KING IMT
     UNITED STATES                                6/21/2002   76/424,630                                   PENDING            12

     PR812

     UNITED STATES                                11/8/2002   76/468,503                                   PENDING            12

     PRESTIGE
     CANADA                                       5/27/1959   251153            12/11/1959   116209        REGISTERED        N/A

     UNITED STATES                                9/1/1954    71/672,582        6/7/1955     607,037       REGISTERED         35

     REGENT
     CANADA                                       8/3/2000    1,069,844                                    PENDING

     MEXICO                                       11/21/2000  459062            8/16/2002    758958        REGISTERED         12

     UNITED STATES                                12/17/1999  75/874,916        6/26/2001    2,464,646     REGISTERED         12

     SCEPTOR
     UNITED STATES                                5/13/1986   73/598,549        12/23/1986   1,421,827     REGISTERED         12

     SHADOW
     CANADA                                       8/3/2000    1,069,845                                    PENDING

     MEXICO                                       9/11/2002   565576                                       PENDING

     UNITED STATES*                               12/17/1999  75/874,915                                   PENDING            12

     * In the name of  TBC CORPORATION

     SIGMA
     CANADA                                       4/12/1990   654,894           4/5/1991     382758        REGISTERED         12

     CHINA                                        6/28/2002   3225734                                      PENDING            12

     GERMANY                                      6/10/1991   T 32 059/12 W     7/14/1992    2017108       REGISTERED         12
</TABLE>

<PAGE>

<TABLE>

    <S>                                           <C>         <C>               <C>          <C>          <C>            <C>
     MEXICO                                       5/29/1995   N/A               7/27/1995    499136        REGISTERED         12

     MEXICO                                       5/29/1995   N/A               7/27/1995    499136        REGISTERED         12

     SOUTH KOREA                                  6/28/2002   2002-30151                                   PENDING

     UNITED KINGDOM                               6/6/1991    1466536           6/6/1991     1466536       REGISTERED         12

     UNITED STATES                                5/15/1998   75/485,561        7/20/1999    2,262,889     REGISTERED         12

     SIGMA & DESIGN
     UNITED STATES                                12/28/1973  73/009,844        11/19/1974   998,427       REGISTERED         12

     SIGMA SUPREME HP
     CANADA                                       8/3/2000    1,069,847                                    ALLOWED

     MEXICO                                       11/21/2000  459065            12/14/2001   728573        REGISTERED

     UNITED STATES                                7/26/2000   76/096,412        6/4/2002     2,575,403     REGISTERED         12

     SIGMA SUPREME TR
     CANADA                                       8/3/2000    1,069,848                                    ALLOWED

     MEXICO                                       11/21/2000  459064            12/14/2001   728572        REGISTERED         12

     UNITED STATES                                12/17/1999  75/874,912        3/26/2002    2,553,584     REGISTERED         12

     SOVRAN
     UNITED STATES                                7/27/1989   73/815,288        6/12/1990    1,600,677     REGISTERED         12

     STAMPEDE
     CANADA                                       12/29/1994  772,066           11/3/1995    TMA449689     REGISTERED         12

     MEXICO                                       1/4/1995    220945            3/28/1995    486513        REGISTERED         12

     UNITED STATES                                9/18/1984   73/499,961        5/28/1985    1,337,798     REGISTERED         12

     SUSSEX
     UNITED STATES                                5/13/1986   73/598,548        12/23/1986   1,421,826     REGISTERED         12

     TALON
     CANADA                                       12/29/1994  772,067           11/3/1995    TMA449690     REGISTERED         12

     MEXICO                                       1/4/1995    220943            3/28/1995    486512        REGISTERED         12

     UNITED STATES                                9/10/1985   73/559,172        4/8/1986     1,388,995     REGISTERED         12

     TBC
     MEXICO                                       8/6/1999    385997                                       PENDING            12

     UNITED STATES                                10/26/1983  73/449,847        7/2/1985     1,345,491     REGISTERED       9,12

     UNITED STATES                                6/13/1978   73/174,209        2/20/1979    1,113,549     REGISTERED         12

     UNITED STATES                                6/8/1995    74/685,983        11/25/1997   2,114,992     REGISTERED  35, 36, 42

     TBC BRANDS
     UNITED STATES                                2/12/2002   76/369,496                                   ALLOWED     9, 12, 16

     TBC ONLINE
     CANADA                                       4/16/1998   875566            6/29/2000    TMA529893     REGISTERED          9

     MEXICO                                       12/16/1998  340767                                       PENDING             9

     UNITED STATES                                1/23/1998   75/423,437        1/25/2000    2,312,424     REGISTERED          9
</TABLE>

<PAGE>

<TABLE>

    <S>                                           <C>         <C>               <C>          <C>          <C>            <C>
     TBC PRIVATE BRANDS & DESIGN
     UNITED STATES                                2/12/2002   76/369,492                                   ALLOWED            35

     TEMPEST
     CANADA                                       8/3/2000    1,069,846                                    ALLOWED

     MEXICO                                       11/21/2000  459063            12/14/2001   728571        REGISTERED         12

     UNITED STATES                                12/17/1999  75/874,914        6/19/2001    2,462,822     REGISTERED         12

     TODAY
     UNITED STATES                                2/25/1994   74/494,330        1/21/1997    2,032,519     REGISTERED         12

     TRAIL GUIDE RADIAL ATP
     UNITED STATES                                3/17/2000   76/004,067        4/2/2002     2,557,059     REGISTERED         12

     TRAIL GUIDE RT
     CANADA                                       3/12/2003   N/A                                          PENDING

     UNITED STATES                                12/4/2002   76/472,525                                   PENDING            12

     TRAIL SCOUT
     MEXICO                                       7/30/1999   385267            9/22/1999    624142        REGISTERED         12

     UNITED STATES                                4/12/1999   75/679,588        7/3/2001     2,466,356     REGISTERED         12

     TRAILER KING
     UNITED STATES                                3/12/2003   76/497,369                                   PENDING

     TURBO-TECH
     UNITED STATES                                7/18/1989   73/813,331        10/2/1990    1,615,599     REGISTERED         12

     ULTRA CELL
     UNITED STATES                                11/1/1984   73/506,662        6/11/1985    1,340,421     REGISTERED          9

     ULTRA LIFE
     UNITED STATES                                11/5/1984   73/507,226        11/19/1985   1,371,051     REGISTERED          9

     ULTREX
     UNITED STATES                                3/16/1994   74/500,719        4/16/1996    1,968,838     REGISTERED         12

     VANDERBILT
     UNITED STATES                                10/6/1961   72/129,434        6/11/1963    750,869       REGISTERED         12

     VANDERBILT TOURING

     UNITED STATES                                12/4/2002   76/472,570                                   PENDING            12

     WILD COUNTRY
     CANADA                                       12/29/1994  772,071           1/19/1996    TMA452895     REGISTERED         12

     MEXICO                                       1/4/1995    220947            3/28/1995    486514        REGISTERED         12

     UNITED STATES                                6/30/1992   74/289,945        3/2/1993     1,755,187     REGISTERED         12

     WILD SPIRIT RADIAL GTX
     UNITED STATES                                12/1/1992   74/335,812        2/15/1994    1,822,004     REGISTERED         12
</TABLE>

<PAGE>

<TABLE>

    <S>                                           <C>         <C>               <C>          <C>          <C>            <C>
     WILD SPIRIT TOURING LS

     UNITED STATES                                12/4/2002   76/472,571                                   PENDING            12

     WILD TRAC
     CANADA                                       12/29/1994  772,069           5/9/1997     TMA475995     REGISTERED         12

     MEXICO                                       1/4/1995    220937            3/28/1995    486510        REGISTERED         12

     UNITED STATES                                7/3/1978    73/177,148        7/17/1979    1,122,304     REGISTERED         12
</TABLE>

                    MERCHANT'S, INCORPORATED AND MERBAN, INC.

<TABLE>
<CAPTION>

                                                              Registration No.                   Registration Date
                                                              ---------------                    -----------------
        <S>                                                   <C>                                <C>
         TEAM MERCHANT'S PERFORMANCE
         SPECIALISTS

         United States                                        2,248,803                          09/17/2000

         29 MINUTES OR LESS, TIRE EXPRESS

         United States                                        2,077,075                          07/18/1997

         NO ONE CARES FOR YOUR CAR
         LIKE MERCHANT'S

         United States                                        2,389,988                          09/26/2000

         READY TO ROLL TIRE PRICING

         United States                                        75/564,275                         Subject to pending opposition
                                                                                                 filing

         MERCHANT'S MAINTENANCE ALERT

         United States                                        2,078,719                          07/15/1997

         MERCHANT'S TIRE & AUTO CENTER

         United States                                        1,420,446                          11/14/87
                                                                                                 11/30/92
                                                                                                 04/05/93

         SERVICE THAT YOU TRUST - GUARANTEED

         United States                                        1,743,581                          12/29/1992

         MERCHANT'S

         United States                                        1,907,199                          07/28/1995
</TABLE>

<PAGE>

                   COPYRIGHT REGISTRATIONS HELD BY TBC BRANDS
                   ------------------------------------------

Title of Work                            Copyright Reg. No.         Reg. Date
-------------                            -----------------          ---------

TBC Corporation                          TX-2-920-912               09/21/90
Electronic Ordering System

Info-Net User's Guide                    TX-4-135-989               11/13/95
(Info-Net Online; Direct
Connection Info-Net)

Info-Net Online, Release 4.1             TX-4-168-625               12/07/95
(Info-Net Online; Direct
Connection Info-Net)

Electronic Ordering System               TX-4-212-078               12/07/95
Release 1.0

<PAGE>

                                                                      EXHIBIT 1A

                             [FORM OF SERIES A NOTE]

                                 TBC CORPORATION

                  8.30% SERIES A SENIOR NOTE DUE JULY 10, 2003

No. RA-[__]                                                     January __, 2001
$[________]                                                     PPN: 872180 B* 4

         FOR VALUE RECEIVED, the undersigned, TBC CORPORATION (herein called the
"Company"), a corporation organized and existing under the laws of the State of
Delaware, hereby promises to pay to _______________, or registered assigns, the
principal sum of ____________ DOLLARS on __________________, with interest
(computed on the basis of a 360-day year and 30-day months) (a) on the unpaid
balance thereof at the rate of (i) at all times prior to but excluding the
Interest Rate Effective Date (as defined in the Agreement (as defined below),
8.30% per annum and (ii) at all times from and including the Interest Rate
Effective Date, 10.30%, payable quarterly on the 10th day of January, April,
July and October in each year, commencing with the January, April, July or
October next succeeding the date hereof, until the principal hereof shall have
become due and payable, and (b) on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of Yield-Maintenance Amount and
any overdue payment of interest, payable quarterly as aforesaid (or, at the
option of the registered holder hereof, on demand), at a rate per annum from
time to time equal to the greater of (i) the interest rate then in effect under
this Series A Note plus 2% per annum or (ii) 2% per annum over the rate of
interest publicly announced by the Bank of New York from time to time in New
York City as its Prime Rate.

         Payments of principal, Yield-Maintenance Amount, if any, and interest
are to be made at the main office of the Bank of New York in New York City or at
such other place as the holder hereof shall designate to the Company in writing,
in lawful money of the United States of America.

         This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to the Second Amended and Restated Note Agreement,
dated as of April 1, 2003 (as amended, restated or otherwise modified from time
to time, the

                                  Exhibit 1A-1

<PAGE>

"Agreement"), between the Company, on the one hand, and The Prudential Insurance
Company of America, on the other hand, and is entitled to the benefits thereof.
As provided in the Agreement, this Note is subject to prepayment, in whole or
from time to time in part, in certain cases with a Yield-Maintenance Amount and
in certain cases without a Yield-Maintenance Amount, all as further specified in
the Agreement.

         This Note is a registered Note and, as provided in the Agreement, upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder's attorney duly authorized in writing, a new Note
for the then outstanding principal amount will be issued to, and registered in
the name of, the transferee. Prior to due presentment for registration of
transfer, the Company may treat the person in whose name this Note is registered
as the owner hereof for the purpose of receiving payment and for all other
purposes, and the Company shall not be affected by any notice to the contrary.

         The Company agrees to make prepayments of principal of this Note on the
dates and in the amounts specified in the Agreement.

         In case an Event of Default shall occur and be continuing, the
principal of this Note may be declared or otherwise become due and payable in
the manner and with the effect provided in the Agreement.

         Capitalized terms used and not otherwise defined herein shall have the
meanings (if any) provided in the Agreement.

         This Note is intended to be performed in the State of New York and
shall be construed and enforced in accordance with the internal law of such
State without regard to any of its conflicts of laws principles that would
direct or permit the application of the laws of another jurisdiction.

                                             TBC CORPORATION

                                             By:
                                                --------------------------------
                                             Title:
                                                   -----------------------------

                                  Exhibit 1A-2

<PAGE>

                                                                      EXHIBIT 1B

                             [FORM OF SERIES B NOTE]

                                 TBC CORPORATION

                  8.62% SERIES B SENIOR NOTE DUE JULY 10, 2005

No. RB-[__]                                                     January __, 2001
$[________]                                                     PPN: 872180 B@ 2

         FOR VALUE RECEIVED, the undersigned, TBC CORPORATION (herein called the
"Company"), a corporation organized and existing under the laws of the State of
Delaware, hereby promises to pay to _______________, or registered assigns, the
principal sum of ____________ DOLLARS on __________________, with interest
(computed on the basis of a 360-day year and 30-day months) (a) on the unpaid
balance thereof at the rate of (i) at all times prior to but excluding the
Interest Rate Effective Date (as defined in the Agreement (as defined below),
8.62% per annum and (ii) at all times from and including the Interest Rate
Effective Date, 10.62%, payable quarterly on the 10th day of January, April,
July and October in each year, commencing with the January, April, July or
October next succeeding the date hereof, until the principal hereof shall have
become due and payable, and (b) on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of Yield-Maintenance Amount and
any overdue payment of interest, payable quarterly as aforesaid (or, at the
option of the registered holder hereof, on demand), at a rate per annum from
time to time equal to the greater of (i) the interest rate then in effect under
this Series B Note plus 2% per annum or (ii) 2% per annum over the rate of
interest publicly announced by the Bank of New York from time to time in New
York City as its Prime Rate.

         Payments of principal, Yield-Maintenance Amount, if any, and interest
are to be made at the main office of the Bank of New York in New York City or at
such other place as the holder hereof shall designate to the Company in writing,
in lawful money of the United States of America.

         This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to the Second Amended and Restated Note Agreement,
dated as of April 1, 2003 (as amended, restated or otherwise modified from time
to time, the

                                  Exhibit 1B-1

<PAGE>

"Agreement"), between the Company, on the one hand, and The Prudential Insurance
Company of America, on the other hand, and is entitled to the benefits thereof.
As provided in the Agreement, this Note is subject to prepayment, in whole or
from time to time in part, in certain cases with a Yield-Maintenance Amount and
in certain cases without a Yield-Maintenance Amount, all as further specified in
the Agreement.

         This Note is a registered Note and, as provided in the Agreement, upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder's attorney duly authorized in writing, a new Note
for the then outstanding principal amount will be issued to, and registered in
the name of, the transferee. Prior to due presentment for registration of
transfer, the Company may treat the person in whose name this Note is registered
as the owner hereof for the purpose of receiving payment and for all other
purposes, and the Company shall not be affected by any notice to the contrary.

         The Company agrees to make prepayments of principal of this Note on the
dates and in the amounts specified in the Agreement.

         In case an Event of Default shall occur and be continuing, the
principal of this Note may be declared or otherwise become due and payable in
the manner and with the effect provided in the Agreement.

         Capitalized terms used and not otherwise defined herein shall have the
meanings (if any) provided in the Agreement.

         This Note is intended to be performed in the State of New York and
shall be construed and enforced in accordance with the internal law of such
State without regard to any of its conflicts of laws principles that would
direct or permit the application of the laws of another jurisdiction.

                                             TBC CORPORATION

                                             By:
                                                --------------------------------
                                             Title:
                                                   -----------------------------

                                  Exhibit 1B-2

<PAGE>

                                                                      EXHIBIT 1C

                             [FORM OF SERIES C NOTE]

                                 TBC CORPORATION

                  8.81% SERIES C SENIOR NOTE DUE JULY 10, 2008

No. RC-[__]                                                     January __, 2001
$[________]                                                     PPN: 872180 B# 0

         FOR VALUE RECEIVED, the undersigned, TBC CORPORATION (herein called the
"Company"), a corporation organized and existing under the laws of the State of
Delaware, hereby promises to pay to _______________, or registered assigns, the
principal sum of ____________ DOLLARS on __________________, with interest
(computed on the basis of a 360-day year and 30-day months) (a) on the unpaid
balance thereof at the rate of (i) at all times prior to but excluding the
Interest Rate Effective Date (as defined in the Agreement (as defined below),
8.81% per annum and (ii) at all times from and including the Interest Rate
Effective Date, 10.81%, payable quarterly on the 10th day of January, April,
July and October in each year, commencing with the January, April, July or
October next succeeding the date hereof, until the principal hereof shall have
become due and payable, and (b) on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of Yield-Maintenance Amount and
any overdue payment of interest, payable quarterly as aforesaid (or, at the
option of the registered holder hereof, on demand), at a rate per annum from
time to time equal to the greater of (i) the interest rate then in effect under
this Series C Note plus 2% per annum or (ii) 2% per annum over the rate of
interest publicly announced by the Bank of New York from time to time in New
York City as its Prime Rate.

         Payments of principal, Yield-Maintenance Amount, if any, and interest
are to be made at the main office of the Bank of New York in New York City or at
such other place as the holder hereof shall designate to the Company in writing,
in lawful money of the United States of America.

         This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to the Second Amended and Restated Note Agreement,
dated as of April 1, 2003 (as amended, restated or otherwise modified from time
to time, the

<PAGE>

"Agreement"), between the Company, on the one hand, and The Prudential Insurance
Company of America, on the other hand, and is entitled to the benefits thereof.
As provided in the Agreement, this Note is subject to prepayment, in whole or
from time to time in part, in certain cases with a Yield-Maintenance Amount and
in certain cases without a Yield-Maintenance Amount, all as further specified in
the Agreement.

         This Note is a registered Note and, as provided in the Agreement, upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder's attorney duly authorized in writing, a new Note
for the then outstanding principal amount will be issued to, and registered in
the name of, the transferee. Prior to due presentment for registration of
transfer, the Company may treat the person in whose name this Note is registered
as the owner hereof for the purpose of receiving payment and for all other
purposes, and the Company shall not be affected by any notice to the contrary.

         The Company agrees to make prepayments of principal of this Note on the
dates and in the amounts specified in the Agreement.

         In case an Event of Default shall occur and be continuing, the
principal of this Note may be declared or otherwise become due and payable in
the manner and with the effect provided in the Agreement.

         Capitalized terms used and not otherwise defined herein shall have the
meanings (if any) provided in the Agreement.

         This Note is intended to be performed in the State of New York and
shall be construed and enforced in accordance with the internal law of such
State without regard to any of its conflicts of laws principles that would
direct or permit the application of the laws of another jurisdiction.

                                             TBC CORPORATION

                                             By:
                                                --------------------------------
                                             Title:
                                                   -----------------------------

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