Document:

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                                                                   Exhibit 10.12
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                              GE CAPITAL AUSTRALIA
                                 ACN 008 562 534

                         GE CAPITAL FINANCE PTY LIMITED
                                 ACN 075 554 175
                           (COLLECTIVELY, THE LENDER)

                       NATIONAL FLEET NETWORK PTY LIMITED
                                 ACN 094 802 141
                                    (COMPANY)

                          NMHG DISTRIBUTION PTY LIMITED
                                 ACN 053 370 291
                                   (GUARANTOR)

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                              A$ FACILITY AGREEMENT
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CONTENTS

       GENERAL TERMS.......................................................... 9

       INTERPRETATION......................................................... 9

1.     THE FACILITY........................................................... 9

       THE FACILITY........................................................... 9

       CONDITIONS PRECEDENT TO THE FACILITY................................... 9

       FURTHER CONDITION PRECEDENT TO THE FACILITY............................ 9

2A.    USING THE OPERATING LEASE FACILITY.....................................10

2B.    [INTENTIONALLY OMITTED]................................................10

2C.    USING THE REVOLVING LOAN FACILITY......................................10

       DRAWINGS...............................................................10

       REQUESTING A DRAWING...................................................10

       EFFECT OF A DRAWDOWN NOTICE............................................10

       CONDITIONS TO FIRST DRAWING............................................10

       CONDITIONS TO ALL DRAWINGS.............................................11

       BENEFIT OF CONDITIONS..................................................11

3.     AVAILABILITY REVOLVING LOAN FACILITY LIMIT.............................11

4.     INTEREST ON REVOLVING LOAN FACILITY....................................11

       INTERPRETATION.........................................................11

       INTEREST CHARGES.......................................................11

       INTEREST PAYMENT.......................................................12

5.     PAYMENTS...............................................................12

       REPAYMENT..............................................................12

       PREPAYMENT.............................................................12

       MANNER OF PAYMENT......................................................12

       PAYMENT APPLICATION....................................................12

       CONVERSION OF CURRENCY.................................................12

       APPLICATION OF PAYMENTS................................................13

6.     CANCELLATION...........................................................13

7.     FEES  .................................................................13

       FEES...................................................................13

8.     LOAN ACCOUNT...........................................................14

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9.     WITHHOLDING TAX........................................................14

       PAYMENTS TO THE LENDER.................................................14

10.    COMPENSATION FOR CHANGED CIRCUMSTANCES.................................15

       COMPENSATION...........................................................15

       CALCULATION IN REASONABLE DETAIL.......................................15

11.    ILLEGALITY OR IMPOSSIBILITY............................................15

       RIGHT TO SUSPEND OR CANCEL.............................................15

       EXTENT AND DURATION....................................................16

       NOTICE REQUIRING REPAYMENT.............................................16

       FEES...................................................................16

12.    REPRESENTATIONS AND WARRANTIES.........................................16

       REPRESENTATIONS AND WARRANTIES.........................................16

       CONTINUATION AND REPETITION OF REPRESENTATIONS AND WARRANTIES..........20

13.    UNDERTAKINGS...........................................................21

       GENERAL UNDERTAKINGS...................................................21

       FINANCIAL UNDERTAKINGS.................................................25

       NEGATIVE COVENANTS.....................................................26

       FINANCIAL REPORTING....................................................28

       OTHER REPORTS..........................................................29

14.    OTHER RIGHTS OF THE COMPANY............................................30

15.    EVENTS OF DEFAULT AND REVIEW EVENT.....................................30

       EVENTS OF DEFAULT......................................................30

       CONSEQUENCES OF DEFAULT................................................33

       EFFECT OF AN EVENT OF DEFAULT..........................................33

       REVIEW EVENT...........................................................34

16.    COSTS AND INDEMNITIES..................................................34

       REIMBURSEMENT AND INDEMNITY............................................34

       OTHER LOSS.............................................................35

       ITEMS INCLUDED IN LOSS, LIABILITY AND COSTS............................36

       PAYMENT OF LOSSES......................................................36

       CURRENCY CONVERSION ON JUDGMENT DEBT...................................36

       CERTIFICATE BY GE SYNDICATION..........................................37

17A.   INTEREST ON OVERDUE AMOUNTS............................................37

       OBLIGATION TO PAY......................................................37

       COMPOUNDING............................................................37

       INTEREST FOLLOWING JUDGMENT............................................37
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17B.   INSURANCE, RISK AND INDEMNITIES........................................38

18.    GUARANTEE AND INDEMNITY................................................40

       REQUEST AND CONSIDERATION..............................................40

19.    ATTORNEY...............................................................40

       APPOINTMENT OF ATTORNEY................................................40

       ATTORNEYS' POWERS......................................................40

       APPLICATION OF INSOLVENCY DIVIDENDS....................................40

       RIGHT OF PROOF LIMITED.................................................41

20.    DEALING WITH INTERESTS.................................................41

       NO DEALING BY COMPANY..................................................41

       DEALINGS BY THE LENDER.................................................41

       NO SET-OFF AGAINST ASSIGNEES...........................................43

21.    NOTICES................................................................43

       FORM...................................................................43

       DELIVERY...............................................................43

       WHEN EFFECTIVE.........................................................43

       DEEMED RECEIPT - POSTAL................................................43

       DEEMED RECEIPT - FACSIMILE.............................................43

22.    GENERAL................................................................44

       SET-OFF................................................................44

       SUSPENSE ACCOUNT.......................................................44

       CERTIFICATES...........................................................44

       PROMPT PERFORMANCE.....................................................44

       DISCRETION IN EXERCISING RIGHTS........................................44

       CONSENTS...............................................................44

       PARTIAL EXERCISING OF RIGHTS...........................................44

       NO LIABILITY FOR LOSS..................................................45

       CONFLICT OF INTEREST...................................................45

       REMEDIES CUMULATIVE....................................................45

       RIGHTS AND OBLIGATIONS ARE UNAFFECTED..................................45

       INDEMNITIES............................................................45

       VARIATION AND WAIVER...................................................45

       CONFIDENTIALITY........................................................45

       FURTHER STEPS..........................................................46

       INCONSISTENT LAW.......................................................46

       SUPERVENING LEGISLATION................................................46

       TIME OF THE ESSENCE....................................................46

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       APPLICABLE LAW.........................................................46

       SERVING DOCUMENTS......................................................46

       ADVERTISING............................................................46

       COUNTERPARTS...........................................................47

       SEVERANCE..............................................................47

23.    INTERPRETATION.........................................................47

       MEANINGS...............................................................47

       REFERENCES TO CERTAIN GENERAL TERMS....................................63

       NUMBER AND HEADINGS....................................................64

       HEADINGS...............................................................64

       BUSINESS DAYS..........................................................64

SCHEDULE 1 - CONDITIONS PRECEDENT (CLAUSE 2.4)................................65

SCHEDULE 2 - INITIAL DRAWDOWN NOTICE (CLAUSE 2.2).............................69

SCHEDULE 3 - BORROWING BASE CERTIFICATE.......................................70

SCHEDULE 4 - EXCLUSIONARY CRITERIA............................................71

SCHEDULE 5 - [INTENTIONALLY OMITTED]..........................................73

SCHEDULE 6 - DISCLOSURES......................................................74

SCHEDULE 7 - GUARANTEE AND INDEMNITY (CLAUSE 18.1)............................75

       GUARANTEE..............................................................75

       NATURE OF GUARANTEE....................................................75

       INDEMNITY..............................................................75

       REINSTATEMENT OF RIGHTS................................................75

       RIGHTS OF GE CAPITAL ARE PROTECTED.....................................76

       NO MERGER..............................................................76

       EXTENT OF GUARANTOR'S OBLIGATIONS......................................77

       GUARANTOR'S RIGHTS ARE SUSPENDED.......................................77

       CROSS GUARANTEE........................................................78

SCHEDULE 8 - FORM OF SUBSTITUTION CERTIFICATE.................................79

SIGNING PAGE..................................................................81
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A$ FACILITY AGREEMENT
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PARTIES
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LENDER:

GE CAPITAL AUSTRALIA ACN 008 562 534 ("GE CAPITAL AUSTRALIA")
Level 5, 55 Hunter Street, Sydney NSW 2000
Facsimile No:  02 9338 4390

GE CAPITAL FINANCE PTY LIMITED ACN 075 554 175
Level 5, 55 Hunter Street
Sydney  NSW  2000
Facsimile No:  02 9338 4390
(individually and collectively, the "Lender" but, in the context of the
revolving loan facility, "Lender" means GE Capital Finance Pty Limited and/or GE
Capital Australia and, in the context of the operating lease facility, "Lender"
means GE Capital Australia)

COMPANY:

NATIONAL FLEET NETWORK PTY LIMITED ACN 094 802 141
1 Bullecourt Avenue, Milperra, NSW 2214
Facsimile No: (02) 9772 6390

GUARANTOR:

NMHG DISTRIBUTION PTY LIMITED ACN 053 370 291
1 Bullecourt Avenue, Milperra, NSW 2214
Facsimile No:  (02) 9772 6390

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Facility Agreement     Page 6 of 83 Pages

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DETAILS
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FACILITIES                    (1) DESCRIPTION:

                              Revolving loan facility to be provided by GE
                              Capital Finance Pty Limited and/or GE Capital
                              Australia.

                              REVOLVING LOAN FACILITY LIMIT:

                              A$5,000,000.

                              AVAILABILITY PERIOD:

                              5 years from the date of this agreement.

                              INTEREST RATE:

                              The index rate plus 2.75% per annum.

                              PURPOSE:

                              Working capital.

                              MATURITY DATE:

                              5 years from the date of this agreement.

                              (2) DESCRIPTION:

                              Operating lease facility to be provided by GE
                              Capital Australia

                              OPERATING LEASE FACILITY LIMIT:

                              A$81,000,000

                              AVAILABILITY PERIOD:

                              7 years from the date of this agreement.

                              PURPOSE:

                              Funding the acquisition of the business.

                              Funding the acquisition of new equipment and used
                              equipment acceptable to the Lender.

                              MATURITY DATE:

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Facility Agreement     Page 7 of 83 Pages

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                              The seventh anniversary of the date of this
agreement.

                        TOTAL FACILITY LIMIT: $86,000,000
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FEES                          UNUSED FACILITY FEE:

                              0.5% per annum on the undrawn revolving loan
                              facility limit on a daily balance - see clause
                              7.1(a)

                              MONITORING FEE:

                              A$100,000 per annum - see clause 7.1(b).

                              ESTABLISHMENT FEE:

                              A$1,290,000 on the date of the first drawdown
                              under this agreement - see clause 7.1(c).

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Facility Agreement     Page 8 of 84 Pages

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================================================================================
GENERAL TERMS

INTERPRETATION

Definitions of terms printed like this are at the end of these General Terms
before the Schedules.

1.       THE FACILITY
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THE FACILITY

1.1      Subject to this agreement, the Lender agrees to provide the company
         with the facility in Australian dollars of an amount not exceeding the
         total facility limit until the termination date. The parties agree that
         the facility includes:

         (a)      the revolving loan facility; and

         (b)      the operating lease facility.

         The total facility limit is an overall collective limit which includes
         the revolving loan facility limit and the operating lease facility
         limit as sub limits.

CONDITIONS PRECEDENT TO THE FACILITY

1.2      The obligations of the Lender under the transaction documents including
         the obligation to provide the facility is subject to and conditional
         upon the Lender being satisfied that it has received:

         (i)      the items listed in Schedule 1;

         (ii)     any other information or document related to the transactions
                  contemplated by the transaction documents which the Lender
                  reasonably requests in relation to the company or the
                  guarantor.

FURTHER CONDITION PRECEDENT TO THE FACILITY

1.3      The Lender need not provide any financial accommodation under any
         facility unless:

         (a)      it is to be provided during the relevant availability period
                  set out in the Details; and

         (b)      providing the financial accommodation will not result in the
                  total facility limit to be exceeded or the facility limit for
                  each of the revolving loan facility and the operating lease
                  facility to be exceeded; and

         (c)      the Lender has received all authorisations necessary or
                  required; and

         (d)      the representations and warranties in clause 12
                  ("Representations and warranties" and (in the case of the
                  revolving loan facility only) the statements in the drawdown
                  notice

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Facility Agreement     Page 9 of 83 Pages

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                  are true, complete and not misleading at the date of the
                  drawdown notice and at the drawdown date; and

         (e)      no event of default has occurred (other than one which has
                  either been waived by the Lender or remedied) and no event of
                  default would result from the provision of the financial
                  accommodation.

2A.      USING THE OPERATING LEASE FACILITY
================================================================================

         The company may request the lease of the equipment under the terms of
         the operating lease facility. GE Capital Australia's obligation to
         lease the equipment is subject to and conditional upon the conditions
         precedents referred to in clauses 1.2 and 1.3 being satisfied. Each of
         the company and the guarantor acknowledge and agree that should the
         company use the operating lease facility, it is bound by the terms and
         conditions of this agreement and the operating lease facility.

2B.      [Intentionally omitted]
================================================================================

         [Intentionally omitted.]

2C.      USING THE REVOLVING LOAN FACILITY
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DRAWINGS

2.1      The company need not use the revolving loan facility. However, if the
         company wants to use the revolving loan facility, it may do so by one
         or more drawings.

REQUESTING A DRAWING

2.2      If the company wants a drawing, the company agrees to give a drawdown
         notice to the Lender by 11am on the business day it wants the drawing.

EFFECT OF A DRAWDOWN NOTICE

2.3      A drawdown notice is effective when the Lender actually receives it in
         legible form. An effective drawdown notice is irrevocable.

CONDITIONS TO FIRST DRAWING

2.4      Before the company requests the first drawing, the company must:

         (a)      ensure that the Lender receives every item listed in Schedule
                  1 in form and substance satisfactory to the Lender; and

         (b)      ensure that the Lender receives all other documents reasonably
                  required by the Lender to verify the items in Schedule 1 in
                  form and substance satisfactory to the Lender; and

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Facility Agreement     Page 10 of 83 Pages

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         (c)      allow a complete review and inspection of the receivables
                  portfolio of the company to be conducted by the Lender and the
                  Lender must confirm the review is acceptable to it.

2.5      The Lender is entitled to rely on the items in Schedule 1 and the
         information contained in them without further enquiry.

2.6      Any transaction document required to be certified must be certified by
         a secretary or a director of the relevant entity as being true,
         complete and correct as at the time of certification and at the date of
         this agreement.

2.7      The Lender agrees to notify the company as soon as practicable after
         the Lender is satisfied that the conditions to first drawing are
         satisfied.

CONDITIONS TO ALL DRAWINGS

2.8      The Lender need not provide any financial accommodation under any
         facility, unless clauses 1.2 and 1.3 are satisfied.

BENEFIT OF CONDITIONS

2.9      Each condition precedent to drawing is for the sole benefit of the
         Lender and may be waived or modified by the Lender.

3.       AVAILABILITY REVOLVING LOAN FACILITY LIMIT
================================================================================

3.1      The total of the current drawings at any time must not exceed the
         lesser of:

         (a)      revolving loan facility limit; and

         (b)      the aggregate borrowing base at that time.

3.2      If the total of the current drawings exceeds the limit set out in
         clause 3.1, the company agrees to immediately repay to the Lender so
         much of the current drawings equal to the excess.

4.       INTEREST ON REVOLVING LOAN FACILITY

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

INTERPRETATION

4.1      [Intentionally omitted].

INTEREST CHARGES

4.2      The company agrees to pay interest on the daily balance of each current
         drawing. The interest charge for each day is calculated by applying the
         interest rate to the daily balance of

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Facility Agreement     Page 11 of 83 Pages

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         the current drawing on the basis of a 360 day year. The interest rate
         for any day will be determined on the first business day of the
         calendar month in which the day falls.

INTEREST PAYMENT

4.3      On each interest payment date the company agrees to pay the Lender the
         interest which has accrued from and including the first day of the
         calendar month of the preceding month up to and including the last day
         of that calendar month.

5.       PAYMENTS
================================================================================

REPAYMENT

5.1      The company agrees to pay within 5 business days of receipt all cash
         receipts, by way of deposit into a controlled account. To the extent
         not already paid, the company agrees to repay to the Lender the total
         of the current drawings on the maturity date for the revolving loan
         facility.

PREPAYMENT

5.2      The company may prepay a current drawing at any time. The facility
         limit for the revolving loan facility is not reduced by the amounts
         prepaid under this clause 5.2.

MANNER OF PAYMENT

5.3      Each obligor agrees to make payments payable by it under each
         transaction document to the Lender on the due date (or, if that is not
         a business day, on the next business day) in Australian dollars to an
         account in Australia in immediately available funds without set-off or
         counterclaim and without any deduction in respect of taxes (unless
         prohibited by law) into the account nominated by the Lender. The
         obligor satisfies a payment obligation only when the Lender receives
         the amount.

PAYMENT APPLICATION

5.4      [Intentionally omitted.]

CONVERSION OF CURRENCY

5.5      All payments by the obligors under this agreement must be made in
         Australian dollars. If the Lender receives an amount in a currency
         other than Australian dollars:

         (a)      it may convert the amount received into Australian dollars
                  (even though it may be necessary to convert through a third
                  currency to do so) on the day and at the rates (including spot
                  rate, same day value rate or value tomorrow rate) as it
                  considers appropriate. It may deduct its usual costs in
                  connection with the conversion; and

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Facility Agreement     Page 12 of 83 Pages

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         (b)      the obligor satisfies its obligation to pay in Australian
                  dollars only to the extent of the amount of Australian dollars
                  obtained from the conversion after deducting the costs of the
                  conversion.

5.6      Where the Lender is obliged to make a payment under this agreement in a
         currency other than Australian dollars, the obligor must reimburse the
         Lender for that payment in Australian dollars unless the Lender
         specifies otherwise. For the purpose of calculating the amount payable
         in Australian dollars, the Lender may:

         (a)      convert the amount payable into Australian dollars (even
                  though it may be necessary to convert through a third currency
                  to do so) on the day and at the rates (including spot rate,
                  same day value rate or value tomorrow rate) as it considers
                  appropriate. It may add its usual costs in connection with the
                  conversion in calculating the amount payable; and

         (b)      the obligor satisfies its obligation to make any payment under
                  this agreement only to the extent that the moneys received by
                  the Lender are sufficient to pay the liability in the other
                  currency including the costs of the conversion to that
                  currency.

APPLICATION OF PAYMENTS

5.7      While an event of default subsists, the Lender will apply amounts paid
         by the obligor or on its behalf and/or to the Lender from any
         controlled account, towards satisfying obligations under the revolving
         loan facility in the manner the Lender sees fit, unless the transaction
         documents expressly provide otherwise.

5.8      [Intentionally omitted].

6.       CANCELLATION
================================================================================

6.1      The company may cancel or terminate the revolving loan facility. It may
         do this if the company gives the Lender at least 20 business days
         notice in writing. Once given, the notice is irrevocable. When the
         cancellation or termination takes effect, the total of the current
         drawings and all other amounts payable or to become payable in the
         future under the revolving loan facility are immediately due and
         payable.

7.       FEES
================================================================================

FEES

7.1      The company agrees to pay the Lender:

         (a)      the non-refundable unused facility fee on the undrawn
                  revolving loan facility limit payable monthly in arrears on
                  the first business day of each month and on the maturity date
                  of the revolving loan facility, such fee to accrue on a daily
                  basis;

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Facility Agreement     Page 13 of 83 Pages

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         (b)      the non-refundable monitoring fee calendar quarterly in
                  arrears commencing on the last day of the calendar quarter
                  that contains the first drawdown under any facility and
                  expiring on (and also being payable on) the last day of the
                  availability period applicable to the revolving loan facility,
                  such fee to accrue on a daily basis;

         (c)      the non-refundable establishment fee on the date of the first
                  drawdown under any facility.

8.       LOAN ACCOUNT
================================================================================

8.1      The Lender agrees to maintain a loan account on its books to record:

         (a)      all current drawings;

         (b)      all other amounts due and payable by the obligor to the Lender
                  under the transaction documents including but not limited to
                  interest, fees and amounts deemed to be current drawings;

         (c)      all payments made by or on behalf of the obligor or by means
                  of the locked box agreement or blocked account agreement; and

         (d)      all other debits and credits as provided for in the
                  transaction documents.

         The balance in the loan account is sufficient evidence of the amounts
         due and owing to the Lender by the obligors in the absence of error.
         However, a failure to record or an error in recording does not limit or
         otherwise affect an obligor's obligations under the transaction
         documents.

8.2      the Lender agrees to provide the company with a monthly statement of
         transactions for the facility. Unless the company notifies the Lender
         of any objection to any item in that statement (specifically describing
         the basis for the objection), within 60 days after the date of the
         statement, each item in the statement is (absent obvious error) prima
         facie evidence of the correctness of the item in the absence of error.

9.       WITHHOLDING TAX
================================================================================

PAYMENTS TO THE LENDER

9.1      If a law requires the obligor to deduct an amount in respect of taxes
         from a payment under any transaction document such that the Lender
         would not actually receive on the due date the full amount provided for
         under the transaction document, then:

         (a)      the amount payable is increased so that, after making the
                  deduction and further deductions applicable to additional
                  amounts payable under this clause 9.1, the Lender is entitled
                  to receive (at the time the payment is due) the amount it
                  would have received if no deductions had been required; and

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Facility Agreement     Page 14 of 83 Pages

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         (b)      the obligor agrees to make the deductions; and

         (c)      the obligor agrees to pay the amounts deducted to the relevant
                  authority in accordance with applicable law and deliver the
                  original receipts to the Lender.

10.      COMPENSATION FOR CHANGED CIRCUMSTANCES
================================================================================

COMPENSATION

10.1     The company agrees to compensate the Lender on demand if, any law or
         change in law taking effect after the date of this agreement, a change
         in any law's interpretation or application by an authority after the
         date of this agreement or compliance by the Lender or any of its
         related entities with any such law, changed law or changed
         interpretation or application directly:

         (a)      increases the cost of the facility to the Lender; or

         (b)      reduces any amount received or receivable by the Lender, or
                  its effective return, in connection with the facility; or

         (c)      reduces the Lender's return on capital allocated to the
                  facility, or its overall return on capital.

         Compensation need not be in the form of a lump sum and may be demanded
         as a series of payments. If the company so requests, the Lender will
         use reasonable endeavours to put in place revised arrangements
         (satisfactory to the Lender and the company) to avoid or minimise the
         increased costs or reduced receipt or return (as the case may be).

CALCULATION IN REASONABLE DETAIL

10.2     If the Lender makes a demand under clause 10.1, it agrees to provide
         the company with reasonably detailed calculations of how the amount
         demanded has been ascertained. However, nothing in this clause 10.2
         obliges the Lender to provide details of its business or tax affairs
         which it considers in good faith to be confidential.

11.      ILLEGALITY OR IMPOSSIBILITY
================================================================================

RIGHT TO SUSPEND OR CANCEL

11.1     This clause 11 applies if:

         (a)      a change in a law; or

         (b)      a change in the interpretation or administration of a law by
                  an authority; or

         (c)      a new law taking effect after the date of this agreement,

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Facility Agreement     Page 15 of 83 Pages
<PAGE>

         makes it (or will make it) illegal or impossible for the Lender to
         fund, provide, or continue to fund or provide, financial accommodation
         under the transaction documents. In these circumstances, the Lender, by
         giving a notice to the company, may suspend or cancel some or all of
         the Lender's obligations under this agreement as indicated in the
         notice.

EXTENT AND DURATION

11.2     The suspension or cancellation:

         (a)      must apply only to the extent necessary to avoid the
                  illegality or impossibility; and

         (b)      in the case of suspension, may continue only for so long as
                  the illegality or impossibility continues.

NOTICE REQUIRING REPAYMENT

11.3     If the illegality or impossibility relates to a current drawing, the
         Lender by giving a notice to the company, may require repayment of all
         or part of that current drawing. The company agrees to repay the amount
         specified within 5 business days after receiving the notice.

FEES

11.4     [Intentionally omitted.]

11.5     The unused facility fee is not payable by the company for that part of
         the facility that is cancelled or suspended under this clause, and
         provided no event of default has occurred or occurs, for the period of
         the suspension or cancellation.

12.      REPRESENTATIONS AND WARRANTIES
================================================================================

REPRESENTATIONS AND WARRANTIES

12.1     Each obligor (to the extent applicable) represents and warrants (except
         in relation to matters disclosed to the Lender by the company and
         accepted by the Lender in writing) that:

         (a)      (INCORPORATION AND EXISTENCE) it has been incorporated as a
                  company limited by shares in accordance with the laws of its
                  place of incorporation, is validly existing under those laws
                  and has power and authority to carry on its business as it is
                  now being conducted; and

         (b)      (POWER) it has power to enter into the transaction documents
                  to which it is a party and observe its obligations under them;
                  and

         (c)      (AUTHORISATIONS) it has in full force and effect all
                  authorisations necessary for it to enter into the transaction
                  documents to which it is a party, to observe its obligations
                  under them, to carry on its business and exercise its rights
                  under them and to allow them to be enforced and such
                  authorisations are valid and subsisting; and

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Facility Agreement     Page 16 of 83 Pages

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         (d)      (NO CONTRAVENTION OR EXCEEDING POWER) the transaction
                  documents and the transactions under them which involve it do
                  not contravene its constituent documents or any law or
                  obligation or agreement by which it is bound or to which any
                  of its assets are subject or cause a limitation on its powers
                  or the powers of its directors to be exceeded; and

         (e)      (OBLIGATIONS VALID, BINDING AND ENFORCEABLE) its obligations
                  under the transaction documents are valid and binding and
                  enforceable against it in accordance with their terms; and

         (f)      (FILINGS) it is not necessary or desirable, to ensure that any
                  transaction document is legal, valid, binding or admissible in
                  evidence, that any transaction document or any other document
                  be filed or registered with any government authority, other
                  than registration of the fixed and floating charge at the
                  Australian Securities and Investments Commission; and

         (g)      (FINANCIAL STATEMENTS) its most recent audited or unaudited
                  (as the case may be) financial statements and any other of its
                  financial statements which it has given to the Lender are a
                  true and fair statement of its financial position as at the
                  date to which they are prepared, are prepared in accordance
                  with the laws of Australia and (unless inconsistent with those
                  laws) accounting standards and disclose or reflect all its
                  actual and contingent liabilities as at that date, and there
                  has been no change in its financial position since the date of
                  those statements that is likely to have a material adverse
                  effect; and

         (h)      (CONSOLIDATED ACCOUNTS) the most recent audited consolidated
                  financial statements of the reporting group are a true and
                  fair statement of the reporting group's financial position as
                  at the date to which they are prepared, are prepared in
                  accordance with the laws of Australia and (unless inconsistent
                  with those laws) accounting standards and disclose or reflect
                  all the economic entity's actual and (in respect of the end of
                  the financial year audited consolidated financial statements
                  only) contingent liabilities as at that date, and there has
                  been no change in its financial position since the date of
                  those statements that is likely to have a material adverse
                  effect; and

         (i)      (EVENT OF DEFAULT) no event of default or potential event of
                  default has occurred or continues unremedied; and

         (j)      (DEFAULT UNDER LAW - MATERIAL ADVERSE EFFECT) neither it nor
                  any of its subsidiaries is in default under a law or
                  obligation affecting any of them or their assets in a way
                  which is likely to have a material adverse effect; and

         (k)      (LITIGATION) as far as it is aware, there is no pending or
                  threatened proceeding affecting it or any of its subsidiaries
                  or any of their assets before a court, governmental agency,
                  commission or arbitrator except those in which a decision
                  against it or the subsidiary (either alone or together with
                  other decisions) would be insignificant; and all actual
                  proceedings which seek damages in excess of $500,000 or
                  injunctive relief or allege criminal misconduct of it or any
                  of its subsidiaries have been disclosed to the Lender; and

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Facility Agreement     Page 17 of 83 Pages
<PAGE>

         (l)      [Intentionally omitted.]

         (m)      [Intentionally omitted.]

         (n)      [Intentionally omitted.]

         (o)      (EMPLOYMENT MATTERS) in the case of the company only, as far
                  as it is aware, there are no pending or threatened strikes or
                  other material employment disputes against it or any of its
                  subsidiaries; and hours worked and payments made to its
                  employees or the employees of any of its subsidiaries comply
                  with all applicable laws and except as disclosed to the Lender
                  set out in the disclosure statement neither it nor any of its
                  subsidiaries is a party to or bound by any collective
                  bargaining agreement, management agreement, consulting
                  agreement or any employment agreement, in each case involving
                  more than $500,000 and except as disclosed to the Lender set
                  out in the disclosure statement and there are no complaints or
                  charges against it or any of its subsidiaries pending or, to
                  its knowledge, threatened to be filed with any authority or
                  arbitrator in connection with the employment or termination of
                  employment by it or any of its subsidiaries of any individual
                  which is likely to have a material adverse effect; and

         (p)      (JOINT VENTURES, SUBSIDIARIES AND AFFILIATES) in the case of
                  the company only, except disclosed to the Lender neither it
                  nor any of its subsidiaries has any subsidiaries, is engaged
                  in any joint venture or partnership, or is an affiliate of any
                  other person; and

         (q)      (CAPITAL STRUCTURE) all of its issued and outstanding share
                  capital and the issued and outstanding share capital of any of
                  its subsidiaries is owned by each of the persons and in the
                  amounts disclosed to the Lender set out in the disclosure
                  statement; and there are no outstanding rights to purchase,
                  options, warrants or similar rights or agreements pursuant to
                  which it or any of its subsidiaries may be required to issue,
                  sell, repurchase or redeem any of their share capital or other
                  equity securities or any share capital or other equity
                  securities of its subsidiaries; and

         (r)      (INDEBTEDNESS) all of its indebtedness in excess of $500,000
                  (excluding indebtedness under this agreement) and the
                  indebtedness in excess of $500,000 of each of its subsidiaries
                  is described in the disclosure statement; and

         (s)      (TAXES) in the case of the company only, all taxes (including
                  taxes on overall net income of the company) which are due and
                  payable by it and each of its subsidiaries have been paid or
                  provision has been made for them to be paid, except where the
                  amount of the tax is the subject of a good faith contest with
                  the appropriate authority and meeting the requirements set out
                  in clause 13.1 (k) and details of any of its tax returns or
                  any tax return of its subsidiaries which are currently being
                  audited are disclosed to the Lender along with any assessments
                  or to its knowledge, threatened assessments in connection with
                  those audits;; and

         (t)      (BROKERS) in the case of the company only, no broker or finder
                  acting on its behalf or on behalf of any of its subsidiaries
                  brought about the obtaining or making of the facility other
                  than as disclosed in writing to the Lender; and

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Facility Agreement     Page 18 of 83 Pages
<PAGE>

         (u)      (INTELLECTUAL PROPERTY) in the case of the company only, it
                  and each of its subsidiaries owns or has rights to use all
                  intellectual property necessary to conduct that business, and
                  each patent, trademark, copyright and licence is listed,
                  together with application or registration numbers, as
                  applicable, in the disclosure statement; and it and each of
                  its subsidiaries conducts its business without infringing or
                  interfering with any intellectual property of any person; and

         (v)      (RANKING OF SECURITY) in the case of the company only, the
                  Lender has been granted a first ranking fixed and floating
                  charge over all present and future assets of the company which
                  takes priority over all other security interests; and

         (w)      (ENVIRONMENTAL MATTERS) in the case of the company only, and
                  to the extent that it has a material adverse effect:

                  (i)      [Intentionally omitted.]

                  (ii)     it and each of its subsidiaries are and have been in
                           compliance with all environmental laws;

                  (iii)    it and each of its subsidiaries have obtained, and
                           are in compliance in all material respects with, all
                           environmental permits required for the operations of
                           their business as presently conducted or as proposed
                           to be conducted;

                  (iv)     it and each of its subsidiaries are not involved in
                           operations or know of any facts, circumstances or
                           conditions that are likely to result in any
                           environmental liabilities;

                  (v)      neither it nor any of its subsidiaries has received a
                           notice identifying any of them as a person who may be
                           the potential recipient of any clean-up notice or
                           potential recipient of any claim for contribution or
                           indemnity by any other person who may be served with
                           a clean-up notice or requesting information under any
                           statutes, and, to its knowledge, there are no facts,
                           circumstances or conditions that may result in it or
                           any of its subsidiaries being identified as a person
                           who may be the potential recipient of any clean-up
                           notice or potential recipient of any claim for
                           contribution or indemnity by any other person who may
                           be served with a clean-up notice under any statutes;

                  (vi)     it and each of its subsidiaries have provided to the
                           Lender copies of all existing environmental reports,
                           reviews and audits and all written information
                           pertaining to their actual or potential environmental
                           liabilities; and

         (x)      [Intentionally omitted.]

         (y)      [Intentionally omitted.]

         (z)      [Intentionally omitted]

         (aa)     (OWNERSHIP OF PROPERTY) in the case of the company only, it
                  has good title to all property held by it or on its behalf and
                  all undertakings carried on by it, as legal and beneficial
                  owner as disclosed to the Lender free from encumbrances other
                  than

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Facility Agreement     Page 19 of 83 Pages
<PAGE>

                  permitted security interests, and there are no facts known to
                  it or any of its subsidiaries which may result in any
                  encumbrances arising over that property; and

         (bb)     (BENEFIT) its entry into and the performance by the obligor of
                  its obligations under the transaction documents to which it is
                  a party is for its commercial benefit and is in its commercial
                  interests; and

         (cc)     (SOLVENCY) there are no reasonable grounds to suspect that it
                  or any of its subsidiaries is unable to pay its debts as and
                  when they become due and payable; and

         (dd)     (NO BENEFIT TO RELATED PARTY) no person has contravened or
                  will contravene section 208 of the Corporations Law by
                  entering into any transaction document or participating in any
                  transaction in connection with a transaction document; and

         (ee)     (FULL DISCLOSURE) in the case of the company only, it has
                  disclosed by it in writing to the Lender all facts relating to
                  it and its subsidiaries, the transaction documents and all
                  things in connection with them which are material to the
                  assessment of the nature and amount of the risk undertaken by
                  the Lender in entering into the transaction documents and
                  doing anything in connection with them; and

         (ff)     (DISCLOSURES) in the case of the company only, all information
                  disclosed to the Lender in connection with any transaction
                  document is true and complete and is not misleading or
                  deceptive in any material way, including information contained
                  in any borrowing base certificate, drawdown notice and
                  disclosure statement; and

         (gg)     (NO IMMUNITY) neither it nor any of its subsidiaries has
                  immunity from the jurisdiction of a court or from legal
                  process; and

         (hh)     (NO CONTROLLER) no controller is currently appointed in
                  relation to it; and

         (ii)     (RANKING) its payment obligations under the transaction
                  documents to which it is a party rank and will rank at all
                  times at least equally with all its present and future
                  unsecured payment obligations, other than those which are
                  mandatorily preferred by law.

CONTINUATION AND REPETITION OF REPRESENTATIONS AND WARRANTIES

12.2     The obligor repeats each of the representations and warranties in this
         clause 12:

         (a)      on the date each rental schedule is entered into under the
                  operating lease facility and on each purchase date under the
                  operating lease facility; and

         (b)      if no repetition occurs under paragraph (a) in a month, on the
                  date in that month on which a borrowing base certificate is
                  delivered by the company.

12.3     Each obligor must notify the Lender of anything that happens at any
         time that makes any one or more of the representations and warranties
         in this clause 12 untrue, incomplete or misleading and deceptive when
         made.

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Facility Agreement     Page 20 of 83 Pages

<PAGE>

13.      UNDERTAKINGS
================================================================================

GENERAL UNDERTAKINGS

13.1     Each obligor undertakes to:

         (a)      (ACCOUNTING RECORDS) keep proper accounting records in
                  accordance with the laws of Australia and (unless inconsistent
                  with those laws) accounting standards and ensure that each of
                  its subsidiaries does the same; and

         (b)      (INFORMATION) promptly give the Lender any document or other
                  information that the Lender reasonably requests from time to
                  time; and

         (c)      (STATUS CERTIFICATES) on request from the Lender, give the
                  Lender a certificate signed by two of its directors which
                  states whether (to the best of their knowledge after making
                  due enquiries) an event of default continues unremedied; and

         (d)      (MAINTAIN AUTHORISATIONS) obtain, renew on time and comply
                  with the terms of, each authorisation necessary for it to
                  enter into the transaction documents to which it is a party,
                  to observe its obligations and exercise its rights under them
                  and to allow them to be enforced; and

         (e)      (INCORRECT REPRESENTATION OR WARRANTY) promptly notify the
                  Lender if it becomes aware that any representation or warranty
                  made by it or on its behalf in connection with a transaction
                  document is found to be incorrect or misleading when made; and

         (f)      (ENSURE NO EVENT OF DEFAULT) do everything reasonably
                  necessary to ensure that no event of default occurs and ensure
                  that each of its subsidiaries does the same; and

         (g)      (NOTIFY DETAILS OF EVENT OF DEFAULT) if an event of default
                  occurs, notify the Lender as soon as possible but, in any
                  event, within five business days giving full details of the
                  event and any step taken or proposed to remedy it; and

         (h)      (PURPOSE) in the case of the company only, use the facility
                  only for the purpose set out in the Details; and

         (i)      (CONTINUE BUSINESS) in the case of the company only, conduct
                  its business and not to change significantly the general
                  character of its business contemplated to be conducted or as
                  otherwise permitted under the transaction documents; and

         (j)      (CONDUCT BUSINESS) in the case of the company only conduct its
                  business (including collecting debts owed to it) in a proper,
                  orderly and efficient manner;

         (k)      (MAKE PAYMENTS) in the case of the company only, duly and
                  punctually pay and discharge or cause to be paid and
                  discharged all taxes (including taxes on overall net income of
                  the company), assessments and other charges imposed by any
                  authority on it or its property. However, it may in good faith
                  contest by appropriate proceedings the validity or amount of
                  any such charge if:

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Facility Agreement     Page 21 of 83 Pages
<PAGE>

                  (i)      at the time it commences the contest no event of
                           default has occurred and is continuing; and

                  (ii)     adequate reserves in respect of the charge are
                           maintained in its books; and

                  (iii)    the contest is maintained and prosecuted continuously
                           with due diligence and operates to suspend collection
                           or enforcement of the charge or any encumbrance in
                           respect of it; and

                  (iv)     no encumbrance arises in respect of the charge other
                           than a permitted security interest; and

                  (v)      the charge does not result in a material adverse
                           effect; and

         (l)      (LANDLORD, AND MORTGAGEE AGREEMENTS) in the case of the
                  company only, promptly, at the request of the Lender, obtain
                  agreements in form and substance satisfactory to the Lender
                  from each landlord or mortgagee of the company, of real
                  property where the computer system owned, used or occupied by
                  the company is located, containing a waiver or subordination
                  of all encumbrances or claims that that person may assert
                  against the company's property; and

         (m)      (DEPOSIT OF FUNDS) in the case of the company only, within 5
                  business day of receipt of any cheques, cash or other items of
                  payment deposit those items into a controlled account; and

         (n)      (PUBLIC NOTICES) give to the Lender copies of all:

                  (vi)     documents issued by it as required by applicable law
                           to be issued to its shareholders; and

                  (vii)    material documents filed by it with the Australian
                           Securities and Investments Commission,

                  promptly following issue or filing of the relevant document or
                  statement; and

         (o)      [Intentionally omitted]

         (p)      [Intentionally omitted]

         (q)      [Intentionally omitted]

         (r)      (ENVIRONMENTAL MATTERS) in the case of the company only,
                  conduct its operations and keep and maintain its property
                  (including, without limitation, all plant and equipment) in
                  compliance with all environmental laws and material
                  environmental permits other than non-compliance which could
                  not reasonably be expected to have a material adverse effect;
                  and implement any and all investigation, remediation, removal
                  and response actions which are appropriate or necessary to
                  maintain the value and marketability if its property
                  (including, without limitation, all plant and equipment) or to
                  otherwise comply with environmental laws and material

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Facility Agreement     Page 22 of 83 Pages

<PAGE>

                  environmental permits; and notify the Lender promptly after it
                  becomes aware of any violation of environmental laws or
                  material environmental permits and of any fact, matter or
                  circumstance which it knows or reasonably anticipates may make
                  it or any of its subsidiaries a person who may be the
                  potential recipient of any clean-up notice or potential
                  recipient of any claim for contribution or indemnity by any
                  other person who may be served with a clean-up notice; and
                  promptly forward to the Lender a copy of any order, notice,
                  request for information or any communication or report
                  (including any actual or threatened clean-up notice) received
                  by it in connection with any such violation or any other
                  matter relating to any environmental laws or material
                  environmental permits that could reasonably be expected to
                  result in environmental liabilities, in each case whether or
                  not any authority has taken or threatened any action in
                  connection with any such violation or other matter; and

         (s)      (INTELLECTUAL PROPERTY) conduct its business without
                  infringing or interfering with any intellectual property of
                  any person; and obtain all patents, trademarks, copyrights
                  permits and licences necessary or required for the conduct of
                  its business; and

         (t)      (MAINTAIN STATUS) maintain its status as a company limited by
                  shares that is incorporated (or is taken to be incorporated)
                  under the Corporations Law; and

         (u)      (COMPLY WITH LAW) comply with all applicable law including by
                  paying when due all taxes (including taxes on overall net
                  income of the obligor) for which it or any of its property is
                  assessed or liable (except to the extent that these are being
                  diligently contested in good faith and by appropriate
                  proceedings and it has made adequate reserves for them); and

         (v)      (HOLD AUTHORISATIONS) obtain and maintain each authorisation
                  that is necessary or desirable to:

                  (i)      execute the transaction documents to which it is a
                           party and to carry out the transactions;

                  (ii)     ensure that the transaction documents to which it is
                           a party are legal, valid, binding and admissible in
                           evidence; or

                  (iii)    enable it to properly carry on its business,

                  and must comply with any conditions to which any of these
                  authorisations is subject where a failure to comply with any
                  or all of those conditions could have a material adverse
                  effect on it; and

         (w)      (NO ADMINISTRATOR) not appoint an administrator without prior
                  notice to the Lender; and

         (x)      (NOTICE TO GE SYNDICATION) immediately give notice to the
                  Lender as soon as it becomes aware of:

                  (i)      any event of default or any potential event of
                           default occurring, which notice must include full
                           details and the steps being taken to remedy such
                           default;

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Facility Agreement     Page 23 of 83 Pages
<PAGE>

                  (ii)     any litigation, arbitration, mediation, conciliation
                           or administrative proceeding, which it is affected by
                           (not being frivolous or vexatious) where such a claim
                           is in excess of $500,000 and which could have a
                           material adverse effect on it;

                  (iii)    any other event, circumstance or occurrence which
                           will have a material adverse effect on it;

                  (iv)     any proposal by, or notification being given to it
                           by, a government agency to compulsorily acquire the
                           whole or substantial part of its assets or business;

                  (v)      any dispute between it and any government agency
                           which will have a material adverse effect on it; and

                  (vi)     any representation or warranty made or taken to be
                           made by it or on its behalf in connection with a
                           transaction document is found to be incorrect or
                           misleading when made or taken to be made; and

         (y)      (PAY INDEBTEDNESS) pay or cause to be paid in full as and when
                  due (or within any period of grace applicable thereto) all of
                  its indebtedness except for:

                  (i)      amounts in respect of which it is disputing its
                           liability and contesting the matter in good faith by
                           appropriate mediation, judicial or arbitral
                           proceedings; and

                  (ii)     amounts (excluding amounts due and payable or which
                           may become due and payable under the transaction
                           documents) payable to any party not in excess of
                           A$100,000 in any calendar year;

         (z)      (COMPLIANCE WITH DOCUMENTS) use its best endeavours to ensure
                  that no event of default by it occurs and must, at all times
                  fully comply with, observe and perform all its obligations
                  under the transaction documents to which it is a party; and

         (aa)     [Intentionally omitted]

         (bb)     (ASSET REGISTER) ensure that the company creates and maintains
                  a written register of all the equipment which records and
                  identifies details of each item of equipment and the location
                  of each item of equipment at all times (the "asset register").
                  The asset register must be in form and substance acceptable to
                  the Lender; and

         (cc)     (ASSET TRACKING SYSTEM) ensure that the company owns and
                  maintains an asset tracking system reasonably acceptable, at
                  all times, to the Lender and provides reasonable access to the
                  Lender at reasonable times to inspect the asset tracking
                  system operated as part of its business; and

         (dd)     (EQUIPMENT INSPECTION) ensure that the Lender has reasonable
                  access to the equipment provided reasonable notice is given to
                  the company; and

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Facility Agreement     Page 24 of 83 Pages
<PAGE>

         (ee)     (EQUIPMENT ASSET AUDIT) ensure that the Lender is given access
                  to the relevant assets and records to conduct a stocktake
                  audit of approximately 15% of the equipment and the rental
                  agreements relating to that equipment to be completed within
                  15 business days of the first drawdown under any facility and
                  the company agrees to give the Lender access on reasonable
                  notice, at the Lender's cost (unless otherwise agreed), to
                  conduct a further stocktake audit if so required.

FINANCIAL UNDERTAKINGS

13.2     The company agrees:

         (a)      (NEGATIVE PLEDGE) not to create or permit to exist, a security
                  interest over any of its property, other than a permitted
                  security interest without the prior written consent of the
                  Lender; and

         (b)      (EBITDAR) to ensure that indebtedness of the company will not
                  be greater than:

                  (i)      5.0 x EBITDAR plus acquisition costs for the 4
                           calendar quarter period ending 30/6/2001 and, for
                           each subsequent (cumulative) period of calendar
                           quarters in 2001 then completed, in each case with
                           EBITDAR for such (cumulative) period to be
                           annualised; and

                  (ii)     4.5 x EBITDAR for each rolling 4 calendar quarter
                           period ending 31 March and 30 June in 2002; and

                  (iii)    4.0 x EBITDAR for each rolling 4 calendar quarter
                           period ending after 30 June 2002.

                  The ratios in this paragraph (b) shall only apply and be
                  tested as at the end of each calendar quarter.

         (c)      (CAPITAL EXPENDITURE) to ensure that the capital expenditures
                  of the company in any financial year does not (in total)
                  exceed A$25 million per annum; and

         (d)      (TANGIBLE NET WORTH) to ensure that, tangible net worth of the
                  company is at least:

                  (i)      A$6,000,000 throughout the calendar year ending 31
                           December 2001; and

                  (ii)     A$8,000,000 thereafter; and

         (e)      (FIXED CHARGE COVER) to ensure that the fixed charge coverage
                  ratio of the company (measured calendar quarterly at the end
                  of the calendar quarter) is not less than:

                  (i)      1.0:1 for the cumulative 6 months to 30 June 2001;

                  (ii)     1:05 for the cumulative 9 months to 30 September
                           2001;

                  (iii)    1:10 for the cumulative 12 months to 31 December
                           2001; and

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Facility Agreement     Page 25 of 83 Pages
<PAGE>

                  (iv)     1:15:1 thereafter calculated on a rolling 4 calendar
                           quarter basis measured calendar quarterly at the end
                           of each quarter; and

         (f)      (DIVIDENDS) to ensure that the aggregate of declared or paid
                  dividends of the company in a financial year are limited to
                  50% of Excess Cash Flow for the preceding financial year.

NEGATIVE COVENANTS

13.3     The company undertakes that it will not (in its own capacity or as
         trustee of any trust or in respect of any property subject to any trust
         of which it is a trustee), without the prior consent of the Lender:

         (a)      (MERGERS) form or acquire any subsidiary or merge or
                  consolidate with, acquire all or substantially all of the
                  assets or share capital or otherwise combine with or acquire
                  any person; or

         (b)      (INVESTMENTS) make or permit to exist any investment in, or
                  any loan or other financial accommodation to any person other
                  than loans to or from a related entity otherwise permitted
                  under this agreement; or

         (c)      (INDEBTEDNESS) incur, assume or permit to exist any
                  indebtedness except permitted indebtedness; or

         (d)      (REPAYMENT) voluntarily prepay, redeem, purchase, defease or
                  otherwise satisfy indebtedness prior to its due date except
                  under the transaction documents, other than amounts not in
                  excess of A$500,000 in any calendar year and permitted
                  payments; or

         (e)      (RELATED PARTY TRANSACTIONS) enter into or be party to any
                  transaction with any other company or related entity to the
                  company except:

                  (i)      for the payment of permitted dividends or permitted
                           payments; or

                  (ii)     where the transaction is:

                           (A)      pursuant to the reasonable requirements of
                                    its business; and

                           (B)      upon terms that are no less favourable to it
                                    than would be obtained in a comparable arm's
                                    length transaction with a person who is not
                                    another company or a related entity, or
                                    affiliate of the company; or

         (f)      (LOANS TO EMPLOYEES) enter into any lending transaction with
                  any of its employees or any employees of any of its
                  subsidiaries for a principal amount of more than A$250,000, or
                  in aggregate A$1,000,000; or

         (g)      (CAPITAL STRUCTURE) other than a contribution of new equity,
                  make any change in its capital structure as described in the
                  disclosure statement or otherwise disclosed to the Lender; or

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Facility Agreement     Page 26 of 83 Pages
<PAGE>

         (h)      (BUSINESS) make any change to any of its business objectives,
                  purposes or operations if that change could have a material
                  adverse effect; or

         (i)      (GUARANTEES) enter into or give any guarantee or other
                  assurance against financial loss in connection with money
                  borrowed or raised by it or at its request or any of its
                  subsidiaries other than permitted indebtedness or in respect
                  of permitted indebtedness; or

         (j)      (SECURITY INTERESTS) create or allow to exist a security
                  interest on the whole or any part of its present or future
                  property except permitted security interests; or

         (k)      (DISPOSE OF PROPERTY) dispose of all or a substantial part of
                  its property (either in a single transaction or in a series of
                  transactions whether related or not and whether voluntarily or
                  involuntarily) except:

                  (i)      the sale of equipment or inventory in the ordinary
                           course of business; or

                  (ii)     disposals (other than those referred to in paragraphs
                           (i) or (iii)) of equipment, real property or fixtures
                           that are obsolete or no longer used or useful in its
                           business where the value of the property disposed of
                           is less than $1,000,000 in total for the company in
                           any financial year; or

                  (iii)    disposals (other than those referred to in paragraphs
                           (i) or (ii)) of other equipment or fixtures where the
                           value of the property disposed of is less than
                           $1,000,000 in total for the company in any financial
                           year; or

         (l)      [Intentionally omitted]

         (m)      (CANCELLATION OF INDEBTEDNESS) cancel any claim or debt owing
                  to it except for reasonable consideration negotiated on an
                  arm's length basis and in the ordinary course of business
                  consistent with past practices; or

         (n)      (RESTRICTED PAYMENTS) make any restricted payment or permitted
                  dividends; or

         (o)      (COMPANY CONSTITUTION) change its constitution; or

         (p)      [Intentionally omitted]

         (q)      [Intentionally omitted]

         (r)      [Intentionally omitted]

         (s)      (SPECULATIVE TRANSACTIONS) enter into any transaction
                  involving commodity options, futures contracts, interest rate
                  swaps or similar transactions except solely to hedge against
                  fluctuations in the prices of foreign currencies receivable or
                  payable by it or under a firm purchase order; or

         (t)      [Intentionally omitted]

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Facility Agreement     Page 27 of 83 Pages
<PAGE>

         (u)      [Intentionally omitted]

         (v)      [Intentionally omitted]

         (w)      [Intentionally omitted]

         (x)      (NEW BANK ACCOUNTS) open any new deposit or other accounts
                  with any bank or financial institution or create any term
                  deposit, unless the Lender has consented to the opening of the
                  account or it is an "Operating Account" as defined in the
                  blocked account agreement; or

         (y)      (RELATED PARTY INDEBTEDNESS) pay or otherwise satisfy
                  indebtedness owed or payable to any related entity of the
                  company .

FINANCIAL REPORTING

13.4     The company undertakes to:

         (a)      (MONTHLY FINANCIAL INFORMATION) give the Lender:

                  (i)      within 30 days of the end of each month, an unaudited
                           consolidated balance sheet of the company as at the
                           last day of that financial month; and

                  (ii)     within 30 days of the end of each month, unaudited
                           consolidated profit and loss and cash flow statements
                           both for that month and the financial year to date
                           for the company setting out in comparative form the
                           figures for the corresponding period in the previous
                           year and the figures contained in the projections for
                           that year; and

                  (iii)    within 45 days of the end of each calendar quarter,
                           an unaudited consolidated balance sheet of the
                           guarantor as at the last day of that calendar
                           quarter;

                  (iv)     within 45 days of the end of each calendar quarter,
                           unaudited consolidated profit and loss and cashflow
                           statements both for that quarter and the financial
                           year to date for the guarantor setting out in
                           comparative form the figures for the corresponding
                           period in the previous year and the figures contained
                           in the projections for that year;

                  (v)      within 45 days after the last day of each quarter, a
                           certificate signed by a director of the company
                           showing the calculations used in determining
                           compliance with the financial undertakings set out in
                           clauses 13.2(b), (c), (d), (e) and (f) and stating
                           that the financial information gives a true and fair
                           view in accordance with laws of Australia and (unless
                           inconsistent) accounting standards of the financial
                           position and results of operations of the reporting
                           group, any other information presented is true and
                           complete in all material respects and that no event
                           of default has occurred or is continuing or, if that
                           statement cannot be made, the nature of each event of
                           default and the steps taken to correct them; and

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Facility Agreement     Page 28 of 83 Pages
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         (b)      (OPERATING PLAN) give to the Lender as soon as it is available
                  but by no later than 60 days after the end of each financial
                  year an annual operating plan on a monthly basis for the
                  company approved by the directors of each company in the
                  company. The operating plan must include:

                  (i)      a statement of all of the material assumptions on
                           which the plan is based; and

                  (ii)     monthly balance sheets and a monthly profit and loss
                           and cash flow statements for the following year.

                  The operating plan must include sales, gross profits,
                  operating expenses, operating profit, cash flow projections,
                  excess borrowing availability and all prepared on the same
                  basis and in similar detail as that on which the financial
                  information referred to in sub-paragraph (a) are provided (and
                  in the case of cash flow projections, representing
                  management's good faith estimates of future financial
                  performance based on historical performance), and include
                  plans for capital expenditures; and

         (c)      (MANAGEMENT LETTER) give to the Lender within 20 business days
                  after the audit committee or the board of NMHG has received
                  any auditor's management letter, exception report or similar
                  letters or reports relating to the business or operations of
                  the company, , a copy (in so far as it relates to the company)
                  of any such management letter, exception report or similar
                  letters or reports; and

         (d)      (ANNUAL FINANCIAL STATEMENTS) give the audited consolidated
                  financial statements of each obligor and NMHG for each
                  financial year to the Lender within 120 days after the end of
                  that year. Those consolidated financial statements must set
                  out in comparative form the figures for the corresponding
                  period in the previous year; and

         (e)      (OFFICER'S CERTIFICATE) give to the Lender at the same time as
                  the financial statements in clause 13.4(d), a certificate
                  signed by a director showing in reasonable detail the
                  calculations used in determining compliance with each of the
                  financial undertakings in clause 13.2 and stating that the
                  financial information gives a true and fair view in accordance
                  with laws of Australia and (unless inconsistent) accounting
                  standards of the financial position and results of operations
                  of each obligor and its subsidiaries, any other information
                  presented by it is true, complete and not misleading or
                  deceptive in any material respects and that no event of
                  default has occurred or is continuing or, if that statement
                  cannot be made, the nature of each event of default and the
                  steps taken to correct them; and

         (f)      (RECONCILIATION REPORT) give the Lender at the same time as
                  the delivery of the monthly financial reports referred to in
                  clause 13.4(a) a reconciliation of the accounts receivable and
                  accounts payable trial balances and month end inventory
                  reports of the reporting group to the general ledger of the
                  reporting group and monthly financial reports delivered under
                  clause 13.4(a).

OTHER REPORTS

13.5     The company undertakes to provide to the Lender in form and substance
         satisfactory to the Lender:

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         (a)      (BORROWING BASE CERTIFICATE) on request by the Lender, but no
                  less frequently than 10 business days after the end of each
                  month, a borrowing base certificate for the company; and

         (b)      (ACCOUNTS RECEIVABLE ROLL FORWARD ANALYSIS) within 10 business
                  days after the end of each month, reports showing all
                  additions and reductions (cash and non-cash) to the accounts
                  receivable of the company for that month; and

         (c)      (OUTSTANDING ACCOUNTS) on request by the Lender, and within 10
                  business days after the end of each month, a summary report of
                  accounts outstanding of the company aged from as follows: 1 to
                  30 days, 31 to 60 days, 61 to 90 days and 91 days or more; and

         (d)      (ASSET REGISTER) on request by the Lender, but no less than
                  every six months, a complete and up-to-date copy of the asset
                  register.

14.      OTHER RIGHTS OF THE COMPANY
================================================================================

14.1     If the Lender at any time has a reasonable basis to believe that there
         may be a violation of any environmental laws or environmental permits
         by any obligor or any environmental liability or any threatened or
         actual service of any clean-up notice or any claim for contribution or
         indemnity against any obligor by any other person served or threatened
         to be served with any clean-up notice, which, in each case, could
         reasonably be expected to have a material adverse effect, then the
         obligor on the request of the Lender agrees to:

         (a)      cause the performance of such environmental investigations and
                  preparation of such environmental reports as the Lender may
                  reasonably request, which must be conducted by reputable
                  environmental consulting firms acceptable to the Lender and be
                  in form and substance acceptable to the Lender; and

         (b)      permit the Lender or its representatives to have access to all
                  property for the purpose of conducting such environmental
                  investigations and testing as it deems reasonably appropriate.

15.      EVENTS OF DEFAULT AND REVIEW EVENT
================================================================================

EVENTS OF DEFAULT

15.1     Each of the following is an event of default:

         (a)      (NON PAYMENT - TRANSACTION DOCUMENT) the obligor does not pay
                  on time any amount payable under any transaction document in
                  the manner required under it, unless that failure results
                  solely from technical difficulties relating to the transfer of
                  such amounts to the Lender and such failure is not remedied
                  within 2 business days after the due date for payment; or

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<PAGE>

         (b)      (CROSS DEFAULT) any present or future monetary obligations of:

                  (i)      the obligor or any of its subsidiaries for amounts
                           totalling more than A$1,000,000 (or its equivalent in
                           another currency); or

                  (ii)     NMHG for amounts totalling more than US$10,000,000,

                  are not satisfied on time (or at the end of their period of
                  grace) or become prematurely payable and are not paid.

                  (A "monetary obligation" means a monetary obligation in
                  connection with:

                  (i)      money borrowed or raised; or

                  (ii)     any hiring arrangement, redeemable preference share,
                           letter of credit or financial markets transaction
                           (including a swap, option or futures contract); or

                  (iii)    a guarantee or indemnity in connection with money
                           borrowed or raised);

                  or

         (c)      (NON OBSERVANCE OF OBLIGATIONS) the obligor does not observe
                  any of its obligations under any transaction documents or
                  under any other agreement or obligation with the Lender or its
                  related entities (not being a non-observance or failure
                  referred to elsewhere in this clause 15.1) and that failure is
                  incapable of remedy or, if capable of remedy, continues for 10
                  business days after the obligor receives a notice from the
                  Lender requiring that failure be remedied; or

         (d)      (ENFORCEMENT AGAINST ASSETS) distress is levied or a judgment,
                  order or encumbrance is enforced, or becomes enforceable,
                  against any property of the obligor or any of its subsidiaries
                  for amounts in total exceeding A$1,000,000 (or the equivalent
                  in any other currency in which the enforcement occurs); or

         (e)      (INCORRECT DOCUMENT) any document or information contained in
                  any document given under clause 2.4 ("Conditions to first
                  drawing") is untrue, incomplete or misleading; or

         (f)      (INCORRECT REPRESENTATION OR WARRANTY) a representation or
                  warranty made by or in respect of the obligor in connection
                  with a transaction document is found to have been untrue,
                  incorrect or misleading when made, or the obligor fails to
                  make a disclosure in accordance with clause 12.3 in any
                  material respect ("Continuation of representations and
                  warranties"); or

         (g)      (INSOLVENCY) the obligor or NMHG is or becomes insolvent or
                  steps are taken to make any of those persons insolvent; or

         (h)      (CEASING BUSINESS) the obligor stops payment, ceases to carry
                  on its business or a material part of it, or threatens to do
                  either of those things except to reconstruct or amalgamate
                  while solvent on terms approved by the Lender; or

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Facility Agreement     Page 31 of 83 Pages
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         (i)      (VOIDABLE TRANSACTION DOCUMENT) a transaction document or a
                  transaction in connection with it is or becomes (or is claimed
                  to be) wholly or partly void, voidable or unenforceable or is
                  terminated without the written consent of the Lender or does
                  not have (or is claimed not to have) the priority the Lender
                  intended it to have ("claimed" in this case means claimed by
                  the obligor or any of its related entities or anyone on behalf
                  of any of them); or

         (j)      (CHANGE OF CONTROL) the persons who at the date of this
                  agreement have control of the obligor cease to have control of
                  the obligor, or one or more other persons acquire control of
                  the obligor after the date of this agreement in each case,
                  without the prior consent of the Lender; or

         (k)      [Intentionally omitted]

         (l)      (REDUCTION OF CAPITAL) the obligor, without the consent of the
                  Lender, takes action to reduce its capital or buy back any of
                  its ordinary shares or passes a resolution referred to in
                  section 254N(1) of the Corporations Law; or

         (m)      (APPOINTMENT OF MANAGER) a person is appointed under
                  legislation to manage any part of the affairs of the obligor;
                  or

         (n)      (MATERIAL ADVERSE CHANGE) an event occurs that has a material
                  adverse effect (ignoring for the purpose of this paragraph (n)
                  only, paragraph (i) of the definition of "material adverse
                  effect"); or

         (o)      (BREACH OF UNDERTAKING) a written undertaking given to the
                  Lender or its solicitors by the obligor in a transaction
                  document is breached or not wholly performed within any period
                  specified in the undertaking or, where no period is specified
                  and the undertaking is not an on-going undertaking, within 7
                  days after the date of the undertaking and that failure is
                  incapable of remedy or, if capable of remedy, continues for 10
                  business days after the obligor receives a notice from the
                  Lender requiring that failure to be remedied; or

         (p)      (DEFAULT UNDER OTHER TRANSACTION DOCUMENT) an event occurs
                  which is called an event of default under any transaction
                  document other than this agreement and that failure is
                  incapable of remedy or, if capable of remedy, continues for 10
                  business days after the obligor receives a notice from the
                  Lender requiring that failure to be remedied; or

         (q)      (NON-OBSERVANCE OF CONDITIONS SUBSEQUENT) the company fails to
                  comply with any condition subsequent and fails to comply
                  within 10 business days of notice from the Lender to rectify
                  the default; or

         (r)      (NON COMPLIANCE WITH FINANCIAL UNDERTAKINGS) the company does
                  not observe any of its obligations under clause 13.2 of this
                  agreement;

         (s)      [Intentionally omitted]

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Facility Agreement              Page 32 of 83 Pages
<PAGE>

         (t)      (INSURANCES) the insurances required under clause 17B are not
                  in full force or effect; or

         (u)      (NON-COMPLIANCE WITH RETURN CONDITIONS) the company fails to
                  comply with the return conditions in respect of 10% or more of
                  the equipment located in any Australian State, at any time; or

         (v)      (LOSS OF AUTHORISATION) any authorisation, exemption, filing
                  or registration or other requirement necessary:

                  (i)      to enable any obligor to comply with any of its
                           obligations under any transaction document to which
                           it is a party; and

                  (ii)     for the conduct of its business,

                  is breached, revoked or refused or does not remain in full
                  force and effect and such event will have a material adverse
                  effect.

CONSEQUENCES OF DEFAULT

15.2     If an event of default occurs and is subsisting, then at the option of
         the Lender:

         (a)      the interest rate applicable to the current drawings and the
                  rent instalments is the default rate;

         (b)      the total of the current drawings, interest on them, the rent
                  instalments, the termination value and all other amounts
                  payable under the transaction documents, (the "AMOUNT OWING")
                  are either:

                  (i)      payable on demand; or

                  (ii)     immediately due for payment; and

         (c)      any of the Lender's obligations under the transaction
                  documents may be terminated.

         the Lender may elect any or all of these options in its absolute
         discretion. The election of any of these options gives immediate effect
         to those provisions, without any need for notice to the obligor.

EFFECT OF AN EVENT OF DEFAULT

15.3     If the Lender declares that the amount owing is immediately due and
         payable it may, at its discretion:

         (a)      enforce the fixed and floating charge; and

         (b)      take possession of the equipment.

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Facility Agreement     Page 33 of 83 Pages
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         The company acknowledges that, upon the occurrence of an event of
         default, and while it subsists, the Lender is entitled to exercise its
         rights and remedies expressly provided for under the terms of the other
         transaction documents.

REVIEW EVENT

15.4     If a Review Event occurs, the Lender will in writing notify the company
         as soon as it becomes aware of the Review Event and the Lender will be
         entitled to consider and to unilaterally notify a variation to the
         operating lease facility limit. The occurrence of a Review Event does
         not prevent the occurrence of an event of default.

16.      COSTS AND INDEMNITIES
================================================================================

REIMBURSEMENT AND INDEMNITY

16.1     Except as expressly provided under any other transaction document, the
         company agrees to pay or reimburse the Lender and indemnifies the
         Lender for and against loss, liability and costs it suffers or incurs,
         on demand for:

         (a)      the Lender's costs in connection with:

                  (i)      the negotiation, preparation, execution, stamping and
                           registration of all transaction documents; and

                  (ii)     it being satisfied that all conditions precedent
                           relating to the provision of the facility have been
                           met; and

                  (iii)    the general on-going administration of the facility
                           (including the giving and considering consents,
                           waivers and releases and any valuation costs (to the
                           extent previously agreed (in writing) by the parties)
                           and inspection costs); and

                  (iv)     non-compliance with the return conditions; and

                  (v)      transfer of the equipment under the option deed; and

         (b)      the Lender's costs and any receiver's costs in otherwise
                  acting in connection with the transaction documents, such as
                  enforcing or preserving rights (or considering enforcing or
                  preserving them) or doing anything in connection with any
                  enquiry by a government authority involving the company or any
                  of its related entities; and

         (c)      taxes and fees (including registration fees) and fines and
                  penalties in respect of fees paid or that the Lender
                  reasonably believes are payable in connection with any
                  transaction document or a payment or receipt or any other
                  transaction contemplated by any transaction document or any
                  supply of anything by the Lender to the company under the
                  transaction documents. However, the company need not pay a
                  fine or penalty in connection with taxes or fees to the extent
                  that it has placed the Lender in sufficient cleared funds for
                  the Lender to be able to pay the taxes or fees by the due
                  date; and

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Facility Agreement     Page 34 of 83 Pages
<PAGE>

         (d)      if GST has application to any supply made under or in
                  connection with this agreement or a transaction document, in
                  addition to any other consideration expressed as payable
                  elsewhere in this agreement or a transaction document, an
                  additional amount on account of GST, such amount to be
                  calculated by multiplying the amount or consideration payable
                  by the company for the relevant supply by the prevailing GST
                  rate (taking into account any input tax credit actually
                  received by the Lender which relates to a GST payment made in
                  respect of any supply made under or in connection with this
                  agreement). Any amount payable on account of GST by the
                  company under this clause must be calculated without any
                  deduction or set off of any other amount (other than as
                  expressly permitted under this clause) and is payable by the
                  company on demand by the Lender whether the demand is by means
                  of an invoice or otherwise; and

         (e)      if the Lender is unable to obtain a full input tax credit for
                  an amount paid on account of GST by the Lender to another
                  person in respect of a supply made by another person to the
                  Lender in respect of this agreement or a transaction document
                  or matters arising under this agreement or a transaction
                  document, an amount equal to the input tax credit to which the
                  Lender is not entitled under the GST legislation.

OTHER LOSS

16.2     The company indemnifies the Lender from and against any costs,
         liability or loss suffered or incurred by the Lender arising from, or
         in connection with:

         (a)      any claim made against it by reason of financial accommodation
                  requested under a transaction document not being provided in
                  accordance with the request for any reason except default of
                  the Lender; and

         (b)      financial accommodation under a transaction document being
                  repaid, discharged or made payable other than on its due date;
                  and

         (c)      the Lender acting in connection with a transaction document in
                  good faith on fax or telephone instructions purporting to
                  originate from the offices of the company given by an
                  authorised officer of the company; and

         (d)      a Review Event or an event of default; and

         (e)      the Lender exercising or attempting to exercise rights in
                  connection with a transaction document after an event of
                  default; and

         (f)      any indemnity the Lender gives a controller or an
                  administrator of the company; and

         (g)      any:

                  (i)      consent, approval, waiver, release or discharge; and

                  (ii)     variation, which is requested by any obligor,

                  of or under any transaction document; and

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Facility Agreement     Page 35 of 83 Pages
<PAGE>

         (h)      any amount becoming due for payment or repayment other than on
                  its due date or any other amount required to be paid or repaid
                  under the transaction documents not being paid or repaid by
                  the company on its due date including, without limitation:

                  (i)      by reason of the cancellation, termination or
                           alteration of any swap or other arrangement made by
                           the Lender to fund, whether in whole or in part, any
                           of those moneys or other payment;

                  (ii)     by reason of any liquidation or re-employment of
                           deposits or other funds acquired by the Lender to
                           fund any of those moneys or other payment; or

                  (iii)    in connection with any prepayment under, or early
                           termination or acceleration of, any transaction
                           document.

                  Nothing in this clause limits any other indemnities contained
                  in this agreement.

ITEMS INCLUDED IN LOSS, LIABILITY AND COSTS

16.3     The company agrees that:

         (a)      the costs referred to in clause 16.1 ("Reimbursement and
                  indemnity") and the liability, loss or costs in clause 16.2
                  ("Other loss") include legal costs in accordance with any
                  written agreement as to legal costs or, if no agreement, on
                  whichever is the higher of a full indemnity basis or solicitor
                  and own client basis; and

         (b)      the costs referred to in clauses 16.1(a) and (b)
                  ("Reimbursement and indemnity") include those paid or payable,
                  to persons engaged by the Lender in connection with the
                  transaction documents (such as consultants); and

         (c)      the costs referred to in clauses 16.1 and 16.2 include those
                  suffered or incurred by any receiver or attorney appointed
                  under the fixed and floating charge and any of the Lender's
                  officers, agents or contractors.

PAYMENT OF LOSSES

16.4     The company agrees to pay the Lender an amount equal to any liability,
         loss or costs of the kind referred to in clause 16.2 ("Other loss")
         suffered or incurred by any officer, agent or contractor of the Lender.

CURRENCY CONVERSION ON JUDGMENT DEBT

16.5     If a judgment or proof of debt for an amount in connection with a
         transaction document is expressed in a currency other than Australian
         dollars, then the company indemnifies the Lender against:

         (a)      any difference arising from converting the other currency if
                  the rate of exchange used by the Lender under clause 5.5
                  ("Conversion of currency") for converting currency when it
                  receives a payment in the other currency is less favourable to
                  the Lender than

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Facility Agreement           Page 36 of 83 Pages
<PAGE>

                  the rate of exchange used for the purpose of the judgment or
                  acceptance of proof of debt; and

         (b)      the costs of conversion.

CERTIFICATE BY GE SYNDICATION

16.6     A statement or certificate given by the Lender setting out the amount
         of any loss, liability or costs incurred or suffered by the Lender
         (including the extent of the Lender's entitlement to a full or reduced
         input tax credit for GST paid in respect of any matter contemplated in
         a transaction document) is, absent error, final, binding and conclusive
         evidence against the obligor of the amount of that loss, liability or
         cost.

17A.     INTEREST ON OVERDUE AMOUNTS
================================================================================

OBLIGATION TO PAY

17.1     If the obligor fails to pay any amount under this agreement on the due
         date for payment, the obligor agrees to pay to the Lender on demand
         interest on that amount at the default rate. The interest accrues from
         day to day from and including the due date up to but excluding the date
         of actual payment and is calculated on actual days elapsed and a year
         of 360 days.

COMPOUNDING

17.2     Interest payable under clause 17.1 ("Obligation to pay") which is not
         paid when due for payment may be added to the overdue amount by the
         Lender at intervals which the Lender determines from time to time or,
         if no determination is made, every 30 days. Interest is payable on the
         increased overdue amount at the default rate in the manner set out in
         clause 17.1 ("Obligation to pay").

INTEREST FOLLOWING JUDGMENT

17.3     If a liability becomes merged in a judgment, then the company agrees to
         pay the Lender on demand interest on the amount of that liability as an
         independent obligation. This interest:

         (a)      accrues from the date the liability becomes due for payment
                  both before and after the judgment until the liability is
                  paid; and

         (b)      is calculated at the rate that is the higher of the judgment
                  rate and the default rate.

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<PAGE>

17B.     INSURANCE, RISK AND INDEMNITIES
================================================================================

17B.1    INSURANCE POLICIES TO BE TAKEN OUT BY THE COMPANY

         The company must take out and maintain with insurers in the name of the
         company and the Lender for their respective rights and interests (with
         the Lender's interest as chargee noted) the following insurance
         policies in respect of:

         (a)      a public liability policy in respect of the business and the
                  equipment and activities carried on at the business for an
                  amount reasonably required by the Lender which:

                  (i)      contains all provisions that are normally contained
                           in public liability policies and any other provisions
                           reasonably required by the Lender; and

                  (ii)     without limiting the rest of this clause 17B covers
                           death and injury to any person and damage to property
                           of any person sustained when that person is using the
                           equipment or entering or near any entrance, passage
                           or stairway to the business;

         (b)      building insurance against fire, storm, tempest, flood,
                  earthquake, lightning, explosion, impact, aircraft (other than
                  hostile aircraft) and aerial devices and articles dropped from
                  them, riot, civil commotion and malicious damage, busting or
                  overflowing of water tanks, apparatus or pipes and such other
                  risks as the Lender may reasonably require, subject to such
                  exclusions, excesses and limitations as may be imposed by the
                  insurers.

17B.2    PROCEEDS OF INSURANCE

         If any loss or damage occurs which is covered by any insurance the
         company is required to maintain under this agreement (even if taken out
         in the name of the company alone in contravention of this agreement)
         the company must:

         (a)      apply for the insurance proceeds immediately;

         (b)      use the proceeds:

                  (i)      in the case of property of the company other than the
                           equipment, to restore, replace, repair or reinstate
                           the loss or damage and use the company's own money to
                           the extent that the proceeds are insufficient; and

                  (ii)     in the case of the equipment and where clause 8 of
                           the operating lease facility applies, to pay the
                           Lender in accordance with clause 8 of the operating
                           lease facility;

         (c)      to the extent insurance proceeds exceed the amount required to
                  be expended under paragraph (b)(i), pay the excess to the
                  company and the Lender in equitable

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Facility Agreement            Page 38 of 83 Pages

<PAGE>

                  proportions having regard to their respective interests in the
                  thing insured or the effect on them of the event insured
                  against.

         If any partial damage to the equipment or any other property occurs
         which is covered by any insurance and such damage is capable of repair,
         where a claim is made by the company under the insurance for an amount
         of less than A$100,000 such insurance proceeds are to be paid to the
         company to be applied by it to repair the damage.

17B.3    POLICIES

         The company must do the following in respect of each policy that it is
         required to maintain under this agreement:

         (a)      take it out with an insurance company approved by the Lender,
                  whose approval must not be unreasonably withheld; and

         (b)      if requested by the Lender, give the Lender a copy of the
                  policy and a certificate of currency for the policy; and

         (c)      ensure that the company's insurance broker from time to time
                  will notify the Lender of any impending cancellation or
                  proposed change in insurance; and

         (d)      pay each premium before the due date and when asked by the
                  Lender, produce receipts for the payments;

         (e)      immediately rectify anything which might prejudice any
                  insurance and reinstate the insurance if it lapses; and

         (f)      notify the Lender promptly when any event occurs which may
                  give rise to a material claim under or which could prejudice a
                  policy of insurance, or if any policy of insurance is
                  cancelled.

17B.4    MAINTAIN INSURANCE

         The company must not do anything without THE Lender prior written
         approval which approval shall not be unreasonably withheld which could
         affect the Lender's rights under any insurance policy or make the
         policy invalid or able to be cancelled.

17B.5    INDEMNITY

         The company indemnifies the Lender on demand against any claim, action,
         damage, loss, liability, cost or expense which the Lender incurs or is
         liable for in connection with other than one arising out of any
         negligent or wilful act, error or omission of the Lender:

         (a)      any damage, loss, injury or death to or of any person or
                  property on or near the equipment;

         (b)      the use of the equipment;

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<PAGE>

         (c)      any defect in the equipment.

18.      GUARANTEE AND INDEMNITY
================================================================================

REQUEST AND CONSIDERATION

18.1     By signing this agreement, the guarantor requests the Lender to enter
         into this agreement and agrees to be bound by this guarantee, the
         provisions set out in Schedule 7, and this agreement in consideration
         of the Lender doing so.

19.      ATTORNEY
================================================================================

APPOINTMENT OF ATTORNEY

19.1     The obligor irrevocably appoints the Lender and each of its authorised
         officers individually as its attorney and agrees to ratify all action
         taken by an attorney under clause 19.2 ("Attorneys' powers").

ATTORNEYS' POWERS

19.2     Each attorney may:

         (a)      where a Review Event or event of default occurs and subsists,
                  perform and observe the obligations of the obligor under this
                  agreement to enable the Lender to exercise its rights under
                  this agreement; and

         (b)      where a Review Event or event of default occurs and subsists,
                  do anything which an obligor may lawfully do to exercise their
                  right of proof after an event relating to insolvency occurs in
                  respect of obligor (these things may be done in the obligor's
                  name or the attorney's name and they include signing and
                  delivering documents, taking part in legal proceedings and
                  receiving any dividend arising out of the right of proof); and

         (c)      delegate its powers (including this power) and may revoke a
                  delegation; and

         (d)      exercise its powers even if this involves a conflict of duty
                  and even if it has a personal interest in doing so.

APPLICATION OF INSOLVENCY DIVIDENDS

19.3     The attorney need not account to an obligor for any dividend received
         on exercising the right of proof under clause 19.2 ("Attorneys'
         powers") except to the extent that any dividend remains after the
         Lender has received all amounts payable or to become payable in the
         future under this agreement.

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<PAGE>

RIGHT OF PROOF LIMITED

19.4     Each obligor agrees not to exercise a right of proof after an event
         occurs relating to the insolvency of the company or any other obligor
         independently of an attorney appointed under clause 19.1 ("Appointment
         of attorney").

20.      DEALING WITH INTERESTS
================================================================================

NO DEALING BY COMPANY

20.1     The obligor may not assign or otherwise deal with its rights under any
         transaction document or allow any interest in them to arise or be
         varied, in each case without the Lender's written consent.

DEALINGS BY THE LENDER

20.2

         (a)      Subject to the succeeding paragraphs of this clause 20.2,
                  except where the assignment by the Lender is to or with a
                  related body corporate, the Lender may not assign its rights
                  under any transaction documents without prior written consent
                  of the obligor such consent not to be unreasonably withheld or
                  delayed. Approval of the obligor will be deemed to have been
                  given if within 10 business days of receipt by the obligor of
                  an application for approval it has not been expressly refused.

         (b)      At the cost and expense of the Lender the obligor will
                  co-operate with and assist the assigning party.

         (c)      The assignment or transfer shall not require the obligor to
                  make any payment or incur any liability that it would not have
                  made or incurred had such assignment not occurred or taken
                  place.

         (d)      The consent of the obligor is not required under paragraph (a)
                  if an event of default has occurred and is subsisting.

         (e)      Each assignee acknowledges that it has made its own
                  independent review of the creditworthiness and business of the
                  obligor and that it has not relied on any representation made
                  by the assigning party in connection with its participation
                  under the transaction documents. In those circumstances the
                  assigning party is not responsible for the performance by the
                  obligor of their obligations under the transaction documents
                  and the assigning party is not obliged to make good any loss
                  suffered by the assignee by virtue of non-performance by the
                  obligor of any term of the transaction documents or to accept
                  a re-transfer of any rights or obligations transferred under
                  the relevant substitution certificate.

         (f)      Any assignment shall, subject to subparagraph (a), be
                  effective only if a substitution certificate is delivered by
                  the Lender and the assignee to the other parties and:

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                  (i)      each party, including the obligor and any person that
                           becomes a party pursuant to this clause, to this
                           agreement irrevocably authorises the Lender to
                           execute any duly completed substitution certificate
                           on its behalf. An assignment is effected either at
                           the time (or if more than one time, the later time)
                           the Lender executes a duly completed substitution
                           certificate delivered to it or otherwise as specified
                           in the substitution certificate;

                  (ii)     from the date on which the substitution take effect
                           (which shall be the date of the substitution
                           certificate or, if later, the date specified in the
                           substitution certificate) and to the extent to the
                           substitution expressed in the substitution
                           certificate;

                           (A)      the assignee:

                                    (I)      succeeds to all the rights,
                                             benefits and entitlements (other
                                             than accrued rights, benefits and
                                             entitlements) of the Lender under
                                             the transaction documents; and

                                    (II)     assumes all the obligations and
                                             responsibilities (other than
                                             accrued obligations and
                                             liabilities) of the Lender and the
                                             transaction documents;

                           (B)      the Lender is released from all its future
                                    obligations and responsibilities under the
                                    transaction documents and the rights of the
                                    Lender against the other parties to this
                                    agreement and vice versa will be cancelled;
                                    and

                           (C)      the other parties are:

                                    (I)      released from all their obligations
                                             and responsibilities (other than
                                             accrued obligations and
                                             liabilities) under the transaction
                                             documents to the Lender; and

                                    (II)     bound to perform those obligations
                                             and discharge those
                                             responsibilities in favour of the
                                             Lender; and

                  (iii)    the Lender shall promptly provide a copy of any
                           substitution certificate to the other parties.

         (g)      Nothing in this clause restricts the ability of the Lender to
                  sub-contract or participate an obligation if the Lender
                  remains liable under the transaction documents for the
                  obligation and the Lender shall be entitled to sub-participate
                  or otherwise sell-down its obligations under the transaction
                  documents provided it remains liable under the transaction
                  documents for that obligation. Any such sub-contracting,
                  participation or sell-down shall not affect the respective
                  rights and liabilities of the Lender and the other parties in
                  respect of the transaction documents and each party to the
                  transaction documents need only recognise the Lender of
                  record.

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         (h)      The parties may from time to time agree in writing that this
                  clause 20.2 applies mutatis mutandis to novations as well as
                  assignments.

NO SET-OFF AGAINST ASSIGNEES

20.3     If the Lender assigns or otherwise deals with its rights under this
         agreement, the obligor may not claim against any assignee (or any other
         person who has an interest in this agreement) any right of set-off or
         other right the obligor has against the Lender.
21.      NOTICES
================================================================================

FORM

21.1     All notices, certificates, consents, approvals, waivers and other
         communications in connection with a transaction document ("Notices")
         must be in writing, signed by an authorised officer of the sender and
         marked for attention as set out in the Parties or, if the recipient has
         notified otherwise in writing, then marked for attention in the way
         last notified.

DELIVERY

21.2     All Notices must be:

         (a)      left at the address set out in the Parties; or

         (b)      sent by prepaid post (airmail, if outside Australia) to the
                  address set out in the Parties; or

         (c)      sent by facsimile to the number set out in the Parties.

         If the intended recipient has notified the sender in writing of a
         changed postal address or changed facsimile number, then the Notice
         must be to the address or number notified.

WHEN EFFECTIVE

21.3     A Notice takes effect from the time it is received unless a later time
         is specified in it.

DEEMED RECEIPT - POSTAL

21.4     If sent by post, a Notice is taken to be received one business day
         after posting (or seven days after posting if sent to or from a place
         outside Australia).

DEEMED RECEIPT - FACSIMILE

21.5     If sent by facsimile, a Notice is taken to be received at the time
         shown in the transmission report of the sender as the time that the
         whole facsimile was sent.

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22.      GENERAL
================================================================================

SET-OFF

22.1     At any time after an event of default, the Lender may set off any
         amount due for payment by the Lender to the obligor against any amount
         due for payment by the obligor to the Lender under the transaction
         documents. The obligor must not claim or set-off any money owing by the
         Lender to it against money owing by the obligor to the Lender.

SUSPENSE ACCOUNT

22.2     Where a Review Event or event of default occurs and subsists, the
         Lender may place in a suspense account any payment it receives from the
         obligor for as long as it thinks prudent and need not apply it towards
         satisfying any money owing to the Lender under this agreement.

CERTIFICATES

22.3     The Lender may give the obligor a certificate about an amount payable
         or other matter in connection with a transaction document. The
         certificate is (absent error) final, binding and conclusive evidence of
         the amount or matter.

PROMPT PERFORMANCE

22.4     If this agreement specifies when the obligor must perform an
         obligation, the obligor agrees to perform it by the time specified. The
         obligor agrees to perform all other obligations promptly.

DISCRETION IN EXERCISING RIGHTS

22.5     the Lender may exercise a right or remedy or give or refuse its consent
         in any way it considers appropriate, including by imposing conditions
         unless a transaction document states otherwise.

CONSENTS

22.6     The obligor agrees to comply with all conditions in any consent the
         Lender gives in connection with any transaction document.

PARTIAL EXERCISING OF RIGHTS

22.7     If the Lender does not exercise a right or remedy fully or at a given
         time, the Lender can still exercise it later.

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NO LIABILITY FOR LOSS

22.8     the Lender is not liable for loss caused by the exercise or attempted
         exercise of, failure to exercise, or delay in exercising, a right or
         remedy.

CONFLICT OF INTEREST

22.9     The Lender's rights and remedies under any transaction document may be
         exercised even if this involves a conflict of duty or the Lender has a
         personal interest in their exercise.

REMEDIES CUMULATIVE

22.10    The rights and remedies of the Lender under any transaction document
         are in addition to other rights and remedies given by law independently
         of that transaction document.

RIGHTS AND OBLIGATIONS ARE UNAFFECTED

22.11    Rights given to the Lender under this agreement and the obligor's
         liabilities under it are not affected by any law that might otherwise
         affect them.

INDEMNITIES

22.12    The indemnities in this agreement are continuing obligations,
         independent of the obligor's other obligations under this agreement and
         continue after this agreement ends. It is not necessary for the Lender
         to incur expense or make payment before enforcing a right of indemnity
         conferred by this agreement.

VARIATION AND WAIVER

22.13    Unless this agreement expressly states otherwise, a provision of this
         agreement, or right created under it, may not be waived or varied
         except in writing signed by the party or parties to be bound.

CONFIDENTIALITY

22.14    The obligors consent to the Lender disclosing information provided by
         the obligors that is not publicly available:

         (a)      in connection with any person exercising rights or dealing
                  with rights or obligations under a transaction document
                  (including in connection with preparatory steps such as
                  negotiating with any potential assignee or potential
                  participant of the Lender's rights or other person who is
                  considering contracting with the Lender in connection with a
                  transaction document); or

         (b)      to a person considering entering into (or who does enter into)
                  a credit swap with the Lender involving credit events relating
                  to the obligor or any of its related entities; or

         (c)      to officers, employees, legal and other advisers and auditors
                  of the Lender; or

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         (d)      to any party to a transaction document or any related entity
                  of the Lender; or

         (e)      with the consent of the obligor about whom the information
                  relates (which consent must not be unreasonably withheld); or

         (f)      as allowed necessary or required by any law court, regulatory
                  body, tribunal, authority, judicial or quasi-judicial
                  proceedings or by any stock exchange.

FURTHER STEPS

22.15    The obligor agrees to do anything the Lender asks (such as obtaining
         consents, signing and producing documents and getting documents
         completed and signed) to bind the obligor and any other person intended
         to be bound under the transaction documents.

INCONSISTENT LAW

22.16    To the extent permitted by law, each transaction document prevails to
         the extent it is inconsistent with any law.

SUPERVENING LEGISLATION

22.17    Any present or future legislation which operates to vary the
         obligations of an obligor in connection with a transaction document
         with the result that the Lender's rights, powers or remedies are
         adversely affected (including by way of delay or postponement) is
         excluded except to the extent that its exclusion is prohibited or
         rendered ineffective by law.

TIME OF THE ESSENCE

22.18    Time is of the essence in any transaction document in respect of an
         obligation of the obligor to pay money.

APPLICABLE LAW

22.19    The transaction documents are governed by the law in force in Victoria.
         The obligor and the Lender submit to the non-exclusive jurisdiction of
         the courts of Victoria.

SERVING DOCUMENTS

22.20    Without preventing any other method of service, any document in a court
         action may be served on a party by being delivered to or left at that
         party's address for service of notices under clause 21 ("Notices").

ADVERTISING

22.21    [Intentionally omitted]

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COUNTERPARTS

22.22    This agreement may consist of a number of copies of this agreement each
         signed by one or more parties to the agreement. When taken together,
         the signed copies are treated as making up the one document. Any copy
         of this agreement signed by a party is binding on that party whether or
         not that or any other copy is signed by or binding upon any other
         party.

SEVERANCE

22.23    Each word, phrase, sentence, paragraph and clause in each transaction
         document is severable no matter how they are linked. If any word,
         phrase, sentence, paragraph or clause is defective, unenforceable, void
         or voidable they may be severed and the remaining words will continue
         to be of full force and effect.

23.      INTERPRETATION
================================================================================

MEANINGS

23.1     These meanings apply in each transaction document unless the contrary
         intention appears:

         ACCOUNTING STANDARDS means accounting standards and principles
         generally and consistently applied in Australia.

         ACQUISITION COSTS means the costs and expenses of the company relating
         to the acquisition of the business including, without limitation,
         signage, stationery, and advertising costs in a total amount not
         exceeding A$3,000,000.

         A$ means the lawful currency of Australia.

         AFFILIATE means, in relation to a person:

         (a)      each person that directly or indirectly owns or controls 5% or
                  more of the share capital having ordinary voting power in the
                  election of directors of that corporation; and

         (b)      each person that controls, is controlled by or is under common
                  control with that corporation.

         AGGREGATE BORROWING BASE means, for a particular
         day, an amount equal to:

         (a)      85% (less the borrowing base dilution) of the value (as
                  determined by the Lender) of the company's eligible accounts;

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<PAGE>

         less:

         (b)      any reserves established by the Lender from time to time.

         AUTHORISATION means any approval, authorisation, consent, exemption,
         filing, licence, authority, notarisation, registration or waiver,
         however described of a government authority.

         AUTHORISED OFFICER means:

         (a)      in the case of the Lender, a director, secretary or an officer
                  whose title contains the word "manager" or a person performing
                  the functions of any of them or the solicitor of the Lender;
                  and

         (b)      in the case of an obligor, a person appointed in writing by
                  the relevant obligor to act as an authorised officer under the
                  transaction documents to which it is a party.

         BLOCKED ACCOUNT AGREEMENT means an agreement dated on or after the date
         of this agreement between the company, the Lender and Citibank.

         BORROWING BASE CERTIFICATE means a certificate in the form set out in
         Schedule 3, or any other form required by the Lender, duly completed by
         the company and signed by an authorised officer of the company.

         BORROWING BASE DILUTION is the amount expressed as a percentage by
         which the dilution exceeds 5% at the time of calculation.

         BUSINESS has the same meaning as "Business" in the BUSINESS SALE
         AGREEMENT.

         BUSINESS DAY means a day on which banks are open for general banking
         business in Sydney (not being a Saturday, Sunday or public holiday in
         Sydney).

         BUSINESS SALE AGREEMENT means the document so entitled dated 10
         November 2000 between Brambles Australia Limited (ACN 000 164 938) and
         the company and others.

         CAPITAL EXPENDITURE means any expenditure for fixed assets or
         improvements (or for replacements, substitutions or additions to them)
         that have a useful life of more than one year (regardless of how the
         expenditure is financed).

         CAPITAL LEASES means any lease of property that in accordance with
         accounting standards would be required to be classified and accounted
         for as a finance lease on the balance sheet of the lessee.

         CAPITAL LEASE OBLIGATIONS means with respect to any capital lease the
         amount of the obligation of the lessee that, in accordance with
         accounting standards, would appear on the balance sheet of the lessee
         in respect of that capital lease.

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<PAGE>

         CLEAN-UP NOTICE means any order, direction, notice or other requirement
         of any government authority in respect of remediation.

         COMPANY means person so described in the Parties.

         CONTROL of a corporation includes the direct or indirect power to
         directly or indirectly:

         (a)      direct the management or policies of the corporation; or

         (b)      control the membership of its board of directors,

         whether or not the power has statutory, legal or equitable force or is
         based on statutory, legal or equitable rights and whether or not it
         arises by means of trusts, agreements, arrangements, understandings,
         practices, the ownership of any interest in shares or stock of the
         corporation or otherwise.

         CONTROLLER has the meaning it has in the Corporations Law.

         CONTROLLED ACCOUNT means each account governed and operated by the
         blocked account agreement.

         COSTS includes charges, expenses and internal administration costs; and
         costs, charges and expenses in connection with advisers on a full
         indemnity basis, and any GST paid or payable by the Lender except to
         the extent that The Lender is entitled to a full or reduced input tax
         credit.

         CURRENT DRAWINGS means the outstanding principal amount of a drawing
         made under the revolving loan facility and any amount deemed to be a
         drawing under the revolving loan facility.

         DEFAULT RATE means the interest rate plus 2% per annum.

         DEPRECIATION EXPENSE means depreciation expense of the reporting group
         determined in accordance with accounting standards.

         DILUTION, which is to be calculated monthly, means for the company, the
         total of non-cash credits made to the accounts receivable of the
         company for the 12 month period ending on the date of determination
         divided by the total sales for that period, expressed as a percentage
         and rounded to the nearest whole number. The dilution is calculated at
         any time by reference to the most recent accounts receivable roll
         forward analysis provided by the company to the Lender under clause
         13.5 or as otherwise determined by the Lender.

         DIRECTION TO PAY means the document dated on or about the date of this
         agreement entitled 'payment direction' between the company, the Lender,
         Brambles Australia Limited (ACN 094 082 141) and Cowley Hearne lawyers.

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         DISCLOSURE STATEMENT means a statement or notice containing or
         purporting to contain the disclosures referred to in Schedule 6 or
         otherwise required or made under this agreement, duly completed by the
         and signed by an authorised officer of the as being true, correct and
         not misleading or deceptive at the date of the statement or notice and
         includes each statement or notice given prior to the date of this
         agreement.

         DRAWDOWN DATE means the date on which a drawing is or is to be made.

         DRAWDOWN NOTICE means a completed and signed notice containing the
         information and representations and warranties set out in Schedule 2,
         or otherwise in the form required by the Lender from time to time.

         EBITDAR means an amount equal to net income of the company less the sum
         of:

                  (a)      income tax credits; and

                  (b)      interest income; and

                  (c)      gain from extraordinary items; and

                  (d)     any aggregate net gain (but not any aggregate net
                          loss) arising from the sale, exchange or other
                          disposition of fixed assets, whether tangible or
                          intangible, other than those made in the ordinary
                          course of business; and

                  (e)     any other non-cash abnormal gains (excluding non-cash
                          revenue and non cash reserve adjustments) which have
                          been added in determining net income, in each case to
                          the extent included in the calculation of net income
                          in accordance with accounting standards, but without
                          duplication;

                  plus (to the extent deducted in determining net income), the
                  sum of:

                  (f)      amortisation; and

                  (g)      depreciation expenses; and

                  (h)      any income tax expense; and

                  (i)      interest expense;

                  (ii)     any letter of credit fees paid in respect of letters
                           of credit issued in favour of Westpac ; and

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                  (j)      rentals paid in respect of any operating lease
                           (excluding real property leases); and

                  (k)      loss from extraordinary items; and

                  (l)      any other non-cash abnormal losses (excluding
                           non-cash expenses and non cash reserve adjustments)
                           which have been deducted in determining net income,
                           in each case to the extent included in the
                           calculation of net income in accordance with
                           accounting standards, but without duplication;

                  (m)      the amount of any deduction to net income as the
                           result of any grant to any members of the management
                           of any shares, in each case to the extent included in
                           the calculation of net income in accordance with
                           accounting standards, but without duplication; and

                  (n)      new common equity contributions.

         For purposes of the definition of EBITDAR, the following items are
         excluded in determining net income:

                  (a)     the income (or deficit) of any person accrued prior
                          to the date it became a subsidiary of, or was merged
                          or consolidated into, the company or any of its
                          subsidiaries;

                  (b)     the income (or deficit) of any person (other than a
                          subsidiary) in which the company or any of it's
                          subsidiaries has an ownership interest, except to the
                          extent any such income has actually been received in
                          the form of cash dividends or distributions;

                  (c)     the undistributed earnings of any subsidiary of the
                          company or any of its subsidiaries to the extent that
                          the declaration or payment of dividends or similar
                          distributions by such subsidiary is not at the time
                          permitted by the terms of any contractual obligation
                          or requirement of law applicable to such subsidiary;

                  (d)     any restoration to income of any contingency reserve,
                          except to the extent that provision for such reserve
                          was made out of income accrued during the relevant
                          period;

                  (e)     any write-up of any asset;

                  (f)     any net gain from the collection of the proceeds of
                          life insurance policies;

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                  (g)     any net gain arising from the acquisition of any
                          securities, or the extinguishment, under accounting
                          standards, of any indebtedness, of the company or any
                          of its subsidiaries;

                  (h)     in the case of a successor to the company or any of
                          its subsidiaries by consolidation or merger or as a
                          transferee of its assets, any earnings of such
                          successor prior to such consolidation, merger or
                          transfer of assets; and

                  (i)     any deferred credit representing the excess of equity
                          in any subsidiary of the company or any of its
                          subsidiaries at the date of acquisition of such
                          subsidiary over the cost to the company or any of its
                          subsidiaries of the investment in such subsidiary.

         ELIGIBLE ACCOUNTS means those accounts of each company which the
         Lender, in its reasonable judgment, determines to be eligible accounts
         based on the most recent borrowing base certificate and excluding,
         among other accounts, the exclusionary criteria.

         ENCUMBRANCE means any security interest, notice under section 218 or
         255 of the Income Tax Assessment Act 1936 (Cwlth) or under section 74
         of the Sales Tax Assessment Act 1992 (Cwlth) or under any similar
         provision of a State, Territory or Commonwealth law, right to remove
         things from land (known as a "profit a prendre"), easement, restrictive
         or positive covenant (other than easements and covenants burdening real
         property), equity, interest, garnishee order, writ of execution, right
         of set-off, lease, licence to use or occupy, assignment of income or
         monetary claim, and any agreement to create any of them or allow any of
         them to exist.

         ENVIRONMENTAL LAWS means any law concerning the environment and
         includes laws, statutes, ordinances, codes, rules, standards and
         regulations from time to time concerning:

         (a)      emissions of substances into the atmosphere, waters and land;

         (b)      pollution and contamination of the atmosphere, waters and
                  land;

         (c)      production, use, handling, storage, transportation and
                  disposal of:

                  (i)      waste;

                  (ii)     hazardous substances; and

                  (iii)    dangerous goods;

         (d)      conservation, heritage and natural resources;

         (e)      threatened, endangered and other flora and fauna species;

         (f)      the erection and use of structures; and

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         (g)      the health and safety of people,

         whether made or in force before or after the date of this agreement.

         ENVIRONMENTAL LIABILITIES means, with respect to any person, all
         liabilities, obligations, responsibilities, response, remedial and
         removal costs, investigation and feasibility study costs, capital
         costs, operation and maintenance costs, losses, damages (including all
         consequential and indirect damages) costs and expenses (including all
         fees, disbursements and expenses of counsel, experts and consultants),
         fines, penalties, sanctions, claims for contribution and indemnity,
         whether arising under statute or otherwise, and interest incurred as a
         result of or related to any claim, suit, action, investigation,
         proceeding or demand by any person, whether based in contract, tort,
         implied or express warranty, strict liability, criminal or civil
         statute or common law, including any arising under or related to any
         environmental laws or environmental permits.

         ENVIRONMENTAL PERMITS means all permits, licences, authorisations,
         consents, certificates, approvals, registration or other written
         documents required by any government authority under any environmental
         laws.

         ESTABLISHMENT FEE means the fee set out in clause
         7.1(c) and in the Details.

         EVENT OF DEFAULT means an event of default so described in this
         agreement (see clause 15 ("Events of default")).

         EXCESS AVAILABILITY means at any time:

         (a)      the lesser of the facility limit for the revolving loan
                  facility and the aggregate borrowing base;

                  LESS

         (b)      current drawings under the revolving loan
                  facility at that time,

         as calculated by the Lender.

         EXCESS CASH FLOW means without duplication, with respect to any
         financial year of the company and its subsidiaries, as contained in the
         annual audited financial statements consolidated net income:

         (a)      PLUS depreciation, amortization and interest expense to the
                  extent deducted in determining consolidated net income;

         (b)      PLUS decreases or MINUS increases (as the case may be) in
                  working capital;

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         (c)      MINUS capital expenditure during such financial year
                  (excluding the financed portion thereof);

         (d)      MINUS interest expense paid or accrued (excluding any original
                  issue discount, interest paid in kind or amortized debt
                  discount, to the extent included in determining interest
                  expense paid or accrued) and scheduled principal payments paid
                  or payable in respect of indebtedness;

         (e)      PLUS extraordinary gains or MINUS extraordinary losses which
                  are cash items not included in the calculation of net income;

         (f)      PLUS taxes (including income tax) deducted in determining
                  consolidated net income to the extent not paid for in cash.

         For purposes of the definition, working capital means Current Assets
         less Current Liabilities, "Current Assets" means accounts receivable,
         inventory and prepaid expenses and "Current Liabilities" means accounts
         payable and accrued expenses.

         EXCLUSIONARY CRITERIA means the criteria set out in Schedule 4.

         EXERCISE DATE has the same meaning as in the residual value facility.

         EQUIPMENT means, at any time, the equipment the subject of the
         operating lease facility.

         FACILITY means each of the revolving loan facility and operating lease
         facility made available under this agreement and the transaction
         documents or any one of them.

         FACILITY LIMIT means, for a facility, the amount set out as such in the
         Details.

         FINANCIAL STATEMENTS means:

         (a)      a profit and loss statement;

         (b)      a balance sheet; and

         (c)      a statement of cash flows,

         together with any notes to those documents and a directors' declaration
         as required under the Corporations Law and any other information
         necessary to give a true and fair view prepared in accordance with
         accounting standards.

         FIXED AND FLOATING CHARGE means the document dated 20 November 2000
         between the Lender and the company.

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         FIXED CHARGE COVERAGE RATIO means, for a period the ratio of:

         (a)      in respect of clauses 13.2(e)(i), (ii) and (iii):

                  (i)     EBITDAR for that period, plus acquisition costs; less

                          any capital expenditures for the same period which are
                          not financed through the incurrence of indebtedness
                          (excluding indebtedness under the revolving loan
                          facility),

                  to

                  (ii)    fixed charges for that period.

         (b)      in respect of clause 13.2(e)(iv):

                  (i)     EBITAR for that period; less

                  (ii)    any capital expenditures for the same period which
                          are not financed through the incurrence of
                          indebtedness (excluding indebtedness under the
                          revolving loan facility),

                  to

                  (iii)   fixed charges for that period.

         FIXED CHARGES means the total of all cash interest expense and fee
         expense on borrowings of the company paid plus scheduled payments of
         principal with respect to indebtedness, plus operating lease rentals
         (excluding real property lease expenses) paid.

         FUNDED DEBT means all indebtedness of the reporting roup for borrowed
         money evidenced by notes, bonds, debentures, or similar evidences of
         indebtedness and which by its terms matures more than one year from, or
         is directly or indirectly renewable or extendable at the debtor's
         option under a revolving credit or similar agreement obligating the
         lender or lenders to extend credit over a period of more than one year
         from the date of creation thereof, and specifically including capital
         lease obligations, current maturities of long term debt, revolving
         credit and short term debt extendable beyond one year at the option of
         the debtor, and also including its obligations under the transaction
         documents.

         GOVERNMENT AUTHORITY means any government or government department, any
         governmental, fiscal, monetary, supervisory or any person charged with
         the administration of any applicable law.

         GST means any tax in the nature of a consumption tax, a goods and
         services tax, a value added tax or similar tax including without
         limitation any tax arising out of the passage of the

--------------------------------------------------------------------------------
Facility Agreement            Page 55 of 83 Pages

<PAGE>

         "A New Tax System (Goods and Services Tax) Act, 1999" (Commonwealth)
         and associated legislation.

         GUARANTEE means the guarantee and indemnity in clause 18 ("Guarantee
         and indemnity").

         GUARANTEED MONEY means, at any time, all amounts then due for payment
         or which will or may become due for payment in the future by the
         company to the Lender in connection with the transaction documents
         (including transactions in connection with them).

         GUARANTOR means each of the persons so described in the Parties,
         jointly and severally.

         HAZARDOUS MATERIAL means any substance, material or waste which is
         regulated by or forms the basis of liability (including, without
         limitation any environmental liability) now or hereafter under, any
         environmental laws, including any material or substance which is:

         (a)      defined as a "solid waste", "hazardous waste", "hazardous
                  material", "hazardous substance", "extremely hazardous waste",
                  "restricted hazardous waste", "pollutant", "contaminant",
                  "hazardous constituent", "special waste", "toxic substance" or
                  other similar term or phrase under any environmental laws;

         (b)      petroleum or any fraction or by-product thereof, asbestos,
                  polychlorinated biphenyls or any radioactive substance; or

         (c)      may be the subject of any clean-up notice.

         INDEBTEDNESS means all indebtedness, actual or contingent, including
         but without duplication:

         (a)      all indebtedness for borrowed money or for the deferred
                  purchase price of property payment for which is deferred six
                  months or more;

         (b)      all reimbursement and other obligations with respect to
                  letters of credit, bankers' acceptances and surety bonds,
                  whether or not matured;

         (c)      all obligations evidenced by notes, bonds, debentures or
                  similar instruments;

         (d)      all indebtedness created or arising under any conditional sale
                  or other title retention agreement with respect to property
                  acquired (even though the rights and remedies of the seller or
                  lender under such agreement in the event of default are
                  limited to repossession or sale of such property);

         (e)      all capital lease obligations;

         (f)      the net present value of the minimum operating lease payments
                  (excluding real property lease payments) plus the residual
                  value discounted at the rate implicit in the lease.

--------------------------------------------------------------------------------
Facility Agreement            Page 56 of 83 Pages

<PAGE>

         (g)      all obligations under commodity purchase or option agreements
                  or other commodity price hedging arrangements, in each case
                  whether contingent or matured;

         (h)      all net unrealised losses under any foreign exchange contract,
                  currency swap agreement, interest rate swap, cap or collar
                  agreement or other similar agreement or arrangement designed
                  to alter risks arising from fluctuations in currency values or
                  interest rates, in each case whether contingent or matured;

         (i)      all indebtedness secured by (or for which the holder of such
                  indebtedness has an existing right, contingent or otherwise,
                  to be secured by) any encumbrance upon or in property or other
                  assets (including accounts and contract rights) owned by the
                  company and its subsidiaries on a consolidated basis, even
                  though the company and its subsidiaries on a consolidated
                  basis has not assumed or become liable for the payment of such
                  indebtedness; and

         (j)      obligations under the transaction documents,

         but excluding obligations to trade creditors incurred in the ordinary
         course of business that are not overdue by more than six months unless
         being contested in good faith.

         INDEX RATE means in respect of each month:

         (a)      the 30 day Bank Bill Swap Rate for the first business day of
                  that month which is quoted as the "Bank Bill Swap Reference
                  Rate Average Bid" in the Money Market section in the following
                  business day's edition of the Australian Financial Review; or

         (b)      if there is an obvious error in the rate described in (a), or
                  if that rate or publication is not published, the average bid
                  rate for bills having a tenor of 30 days as displayed on the
                  Reuters Monitor System designated "BBSY" on the first business
                  day of that month; or

         (c)      if there is an obvious error in the rate described in (b) or
                  if that rate is not displayed by 10:30am Sydney time on the
                  relevant day, the rate set by the Lender in good faith at
                  10:30am on that date.

         INSOLVENT means being an insolvent under administration or insolvent
         (each as defined in the Corporations Law), or having a controller
         appointed, or being in receivership, in receivership and management, in
         liquidation, in provisional liquidation, under administration, wound
         up, subject to any arrangement, deed of company arrangement, assignment
         or composition, protected from creditors under any statute, dissolved
         (other than to carry out a reconstruction while solvent) or otherwise
         being unable to pay debts when they fall due or having something
         similar happen.

         INTELLECTUAL PROPERTY means all patents, copyrights, trademarks, trade
         secrets, customer lists and any licence to use any of them.

--------------------------------------------------------------------------------
Facility Agreement            Page 57 of 83 Pages
<PAGE>

         INTEREST EXPENSE means interest expense of the company (whether cash or
         non-cash) determined in accordance with accounting standards. It also
         includes interest expense with respect to any funded debt.

         INTEREST PAYMENT DATE means the first business day of each month and
         the maturity date.

         INTEREST RATE means the interest rate set out in the Details.

         LAW means a treaty, a law, regulation, ordinance, an official directive
         or request having the force of law, and an official directive, request,
         guideline or policy with which obligors similar to or of the same class
         as the obligor carrying on business in Australia normally comply.

         MATERIAL ADVERSE EFFECT means any effect or series of effects, or any
         event or combination of events which is, or is more likely than not to
         be, materially adverse to:

                  (i)      the ability of the obligor to perform its obligations
                           under a transaction document to which it is a party;
                           or

                  (ii)     the business, assets or financial condition of any
                           obligor taken as a whole.

         MATURITY DATE means, for each facility, the maturity date set out as
         such in the Details, but if that is not a business day, then the
         preceding business day.

         MONITORING FEE means the fee set out in clause 7.1(b) and the Details.

         NOVATION AGREEMENT means the agreement so entitled between the company,
         Brambles Australia Limited and others.

         NMHG means NACCO Materials Handling Group, Inc.

         OBLIGOR means the company and the guarantor.

         OPERATING LEASE FACILITY means (individually and collectively) the
         documents dated on or about the date of this agreement entitled the
         "Master Operating Lease Agreement" (No. 1) or (No. 2) between GE
         Capital Australia and the company in respect of the equipment and
         annexed as annexure "A".

         OPERATING LEASE FACILITY LIMIT means, subject to clause 15.4, the
         amount set out as such in the Details.

         OPTION means the option granted under the option deed.

--------------------------------------------------------------------------------
Facility Agreement            Page 58 of 83 Pages
<PAGE>

         OPTION DEED means the deed so entitled between the guarantor and the GE
         Capital Australia dated on or about the date of this agreement.

         PERFORMANCE GUARANTEE means the guarantee so entitled between the
         guarantor and Westpac Banking Corporation.

         PERMITTED DIVIDEND means each dividend or distribution of cash or
         property or assets in respect of the company provided:

         (a)      there is no event of default subsisting;

         (b)      the dividend or the aggregate dividends declared or paid by
                  the company for the financial year is limited to up to 50% of
                  Excess Cash Flow for the preceding financial year based on the
                  financial statements required by subclauses 13.4(d) and
                  13.4(e) of this agreement; and

         (c)      until such time as the revolving loan facility is cancelled or
                  has expired, the company will have an excess availability of
                  not less than A$1,000,000 immediately on the day of the
                  payment of any such dividend.

         PERMITTED INDEBTEDNESS means all indebtedness of the company provided
         the company is in compliance with clause 13.2. For the avoidance of
         doubt, permitted indebtedness includes:

         (a)      indebtedness arising under the transaction documents; and

         (b)      indebtedness otherwise expressly permitted or required under
                  the transaction documents.

         PERMITTED PAYMENT means a payment by the obligor to a person that has
         entered into a transaction document with the Lender provided the
         payment is made in accordance with the terms of the transaction
         document, and no event of default has occurred or will occur by making
         the payment.

         PERMITTED SECURITY INTERESTS means:

         (a)      a security interest created under a transaction document; and

         (b)      a security interest arising by operation of law to secure a
                  monetary obligation maturing not more than 90 days after the
                  date on which it is originally incurred.

         POTENTIAL EVENT OF DEFAULT means an event with the passage of time
         would become an event of default.

         PROJECTIONS means forecasted balance sheets, profit and loss statements
         and cash flow statements, all prepared on a consolidated basis, and
         otherwise consistent with the historical financial statements, together
         with appropriate supporting details and a statement of underlying
         assumptions.

--------------------------------------------------------------------------------
Facility Agreement            Page 59 of 83 Pages
<PAGE>

         REAL PROPERTY means, in respect of a person, the real property owned,
         leased, subleased used or controlled by that person.

         RELATED ENTITY has the meaning it has in the Corporations Law.

         REMEDIATION means the investigation, clean-up, removal, abatement,
         disposal, control, containment, encapsulation or other treatment of any
         hazardous material and includes the monitoring and risk management of
         any hazardous material.

         RENTAL AGREEMENT has the same meaning as in the operating lease
         facility.

         RENTAL SCHEDULE has the same meaning as in the operating lease
         facility.

         RENT INSTALMENTS has the same meaning as in the operating lease
         facility.

         REPORTING GROUP means each of the obligors that are companies, and
         their subsidiaries on a consolidated basis jointly and severally, in
         their own capacities and as trustee of any trust.

         RESTRICTED PAYMENT means:

         (a)      the declaration or payment of any dividend or the incurrence
                  of any liability to make any other payment or distribution of
                  cash or other property or assets in respect of a company's
                  share capital; or

         (b)      any payment on account of the purchase, redemption,
                  defeasance, sinking fund or other retirement of a person's
                  share capital or any other payment or distribution made in
                  respect of the company's share capital, either directly or
                  indirectly; or

         (c)      any payment or repayment of principal of, premium, if any, or
                  interest, fees or other charges on or with respect to, and any
                  redemption, purchase, retirement, defeasance, sinking fund or
                  similar payment and any claim for rescission or with respect
                  to, any subordinated debt of the company; or

         (d)      any payment made to redeem, purchase, repurchase or retire, or
                  to obtain the surrender of, any outstanding warrants, options
                  or other rights to acquire the company's share capital; or

         (e)      any payment of a claim for the rescission of the purchase or
                  sale of, or for material damages arising from the purchase or
                  sale of shares in the company's share capital or of a claim
                  for reimbursement, indemnification or contribution arising out
                  of or related to any such claim for damages or rescission; or

         (f)      any payment, repayment, loan, contribution, or other
                  disposition or transfer of funds or other property to any
                  affiliate or related entity of the company; or

--------------------------------------------------------------------------------
Facility Agreement            Page 60 of 83 Pages

<PAGE>

         (g)      management or consultancy fees paid or payable to a related
                  entity or affiliate of the company.

         RETURN CONDITIONS means the conditions set out in annexure "A" of the
         operating lease facility.

         REVIEW EVENT means the occurrence of an event that has a material
         adverse effect.

         REVOLVING LOAN FACILITY means the revolving cash advance facility made
         available by the Lender under clause 2C of this agreement.

         REVOLVING LOAN FACILITY LIMIT means the amount set
         out as such in the Details.

         SALE AND PURCHASE AGREEMENT means each of:

         (a)      the document so entitled dated on or about the date of this
                  agreement between the Lender and the company in respect of the
                  equipment and annexed as annexure "B"; and

         (b)      the agreement arising from the acceptance by the Lender of an
                  offer made by the company on or about the date of this
                  agreement.

         SECURITY INTEREST means any security for the payment of money or
         performance of obligations including a mortgage, charge, lien, pledge,
         trust or power. Security interest also includes a guarantee.

         SUBSIDIARY of an entity means another entity which is a subsidiary of
         the first within the meaning of part 1.2 division 6 of the Corporations
         Law or is a subsidiary of or otherwise controlled by the first within
         the meaning of any approved accounting standard.

         SUBSTITUTION CERTIFICATE means a substitution certificate in the form
         of schedule 8.

         TANGIBLE NET WORTH means the book value of the assets of the company
         less, without duplication:

         (a)      goodwill, capitalised organisational expenses, capitalised
                  research and development expenses, capitalised marketing
                  costs, trademarks, trade names, copyrights, patents, patent
                  applications, licences and rights in any of them and other
                  intangible items;

         (b)      unamortised debt discount and expense;

         (c)      prepaid expenses;

         (d)      any write up in the book value of any asset not resulting from
                  a revaluation attributable to an acquisition; and

--------------------------------------------------------------------------------
Facility Agreement            Page 61 of 83 Pages

<PAGE>

         (e)      the liabilities of the company (including accrued and deferred
                  income taxes),

         all as determined in accordance with accounting standards.

         TAXES means present or future taxes, levies, imposts, charges, duties
         or withholdings imposed by any authority (including without limitation
         GST, stamp duty, Financial Institution Duty, Bank Accounts Debits Tax
         and any other transaction duties) (together with any related interest,
         penalties, fines and expenses in connection with them), except if
         imposed on the overall net income of the Lender.

         TERMINATION DATE means the seventh anniversary of the date of this
         agreement.

         TERMINATION VALUE has the same meaning as in the operating lease
         facility.

         TOTAL FACILITY LIMIT means the collective limit of the revolving loan
         facility limit and the operating lease facility limit.

         TRANSACTION DOCUMENTS means:

         (a)      this agreement;

         (b)      the operating lease facility;

         (c)      the sale and purchase agreement;

         (d)      the fixed and floating charge;

         (e)      the direction to pay;

         (f)      the US Guarantee;

         (g)      the option deed;

         (h)      the blocked account agreement;

         (i)      the pari passu deed referred to in clause 2.5 of the fixed and
                  floating charge;

         (i)      each document required to be provided by or on behalf of an
                  obligor under this agreement;

         (k)      each document which the company acknowledges in writing to be
                  a transaction document;

         (l)      each document including or containing obligations of any of
                  the obligors to the Lender; and

--------------------------------------------------------------------------------
Facility Agreement            Page 62 of 83 Pages
<PAGE>

         (m)      each other document connected with any of the documents set
                  out in sub-clauses (a) to (l).

         UNUSED FACILITY FEE means the fee described in
         clause 7.1(a) and the Details.

         US$ means the lawful currency of the United States of America.

         US GUARANTEE means the guarantee and indemnity and covenant to pay
         granted by NMHG in favour of the Lender.

         WORKING CAPITAL means current assets less current liabilities as those
         terms are defined in schedule 5 to the regulations to the Corporations
         Law.

         WESTPAC means Westpac Banking Corporation ARBN 007 457 141.

REFERENCES TO CERTAIN GENERAL TERMS

23.2     Unless the contrary intention appears, a reference
         in a transaction document to:

         (a)      a group of persons is a reference to any two or more of them
                  collectively and to each of them individually;

         (b)      an agreement, representation or warranty in favour of two or
                  more persons is for the benefit of them collectively and each
                  of them individually;

         (c)      an agreement, representation or warranty by two or more
                  persons binds them collectively and each of them individually;

         (d)      anything (including an amount) is a reference to the whole and
                  each part of it;

         (e)      a document (including this agreement) includes any variation
                  or replacement of it;

         (f)      any legislation includes any consolidation, amendment,
                  re-enactment or replacement of it and any regulations and
                  other instruments made under it;

         (g)      an accounting term is a reference to that term as it is used
                  in accounting standards under the Corporations Law, or, if not
                  inconsistent with those standards, in accounting principles
                  and practices generally accepted in Australia;

         (h)      Australian dollars or $ is a reference to the lawful currency
                  of Australia;

         (i)      a time of day is a reference to Sydney time;

         (j)      a week is a reference to the period of seven consecutive days
                  commencing on each Sunday;

--------------------------------------------------------------------------------
Facility Agreement            Page 63 of 83 Pages

<PAGE>

         (k)      the word "person" includes an individual, a firm, a body
                  corporate, an unincorporated association and an authority;

         (l)      a particular person includes a reference to the person's
                  executors, administrators, successors, permitted substitutes
                  (including persons taking by novation) and permitted assigns;

         (m)      the word "payable" in relation to an amount, means an amount
                  which is currently payable or will or may be payable in the
                  future; and

         (n)      the words "including", "for example" or "such as" when
                  introducing an example, do not limit the meaning of the words
                  to which the example relates to that example or examples of a
                  similar kind; and

         (o)      an event of default subsists until it is cured or remedied to
                  the satisfaction of the Lender.

NUMBER AND HEADINGS

(a)      The singular includes the plural and vice versa.

HEADINGS

(b)      Headings are for convenience only and do not affect the interpretation
         of this agreement.

BUSINESS DAYS

23.3     If the day on which any act, matter or thing is to be done under or
         pursuant to a transaction document is not a business day, that act,
         matter or thing:

         (a)      if it involves a payment, other than a payment due on demand,
                  shall be done on the preceding business day; and

         (b)      in all other cases, shall be done no later than the next
                  business day.

--------------------------------------------------------------------------------
Facility Agreement            Page 64 of 83 Pages

<PAGE>
SCHEDULE 1 - CONDITIONS PRECEDENT (CLAUSE 2.4)
================================================================================
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ITEM                                                            FORM                 RESPONSIBLE
--------------------------------------------------------------- -------------------- ----------------------------------
<S>                                                             <C>                  <C>
1        Extract of  minutes  of a meeting  of each  obligor's  Certified            Format provided by the Lender.
         board of directors which evidences the resolutions:    Copy                 Executed copy from company

       (a)     authorising the signing and delivery of
               transaction documents to which the entity is
               a party and the observance of obligations
               under those documents; and

       (b)    appointing authorised officers of the
              entity; and

       (c)    which acknowledge that the transaction
              documents (to which the entity is a party)
              will benefit that entity; and

       (d)    authorising the execution of a power of
              attorney to enable execution of transaction
              documents to which it is a party by the
              attorney.

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

2        Each document which evidences any other necessary      Certified copy       company
         corporate or other action of each obligor in
         connection with the transaction documents to which
         it is party.

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

3      Certificate of specimen signatures of:                   Original             Format supplied by the Lender

       (a)    each authorised officer of the company; and                            Executed copy from company
</TABLE>

--------------------------------------------------------------------------------
Facility Agreement            Page 65 of 83 Pages

<PAGE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ITEM                                                            FORM                 RESPONSIBLE
---------------------------------------------------------------------------------------------------------------------
<S>                                                             <C>                  <C>

       (b)    each other person who is  authorised to sign
              a transaction document for the company.

--------------------------------------------------------------------------------------------------------------------
4      This  agreement,  each other  transaction  document      Original             company
       (other than the blocked account agreement, which is
       a condition precedent only for the revolving loan
       facility), Novation Agreement, Performance
       Guarantee and the Business Sale Agreement fully
       signed by each obligor.

--------------------------------------------------------------- -------------------- ----------------------------------
5      Fixed and floating charge over all presen  and           Original             company
       future assets and  undertaking of the company fully
       signed and in registrable form.

--------------------------------------------------------------- -------------------- ----------------------------------
6      Fully signed Corporations Law Forms 309 and Form         Original             company
       350.

--------------------------------------------------------------- -------------------- ----------------------------------
7      A statutory declaration from a director or               Original             company
       secretary of each company providing the charge
       setting out the value and location of the assets of
       the company.

--------------------------------------------------------------- -------------------- ----------------------------------
8      Evidence of payment of stamp duty or a cheque for         Original            Company
       the amount of the estimated duty.

--------------------------------------------------------------- -------------------- ----------------------------------
9      Initial borrowing base certificate completed and          Original            Format from the Lender.
       certified for the revolving loan facility only.                               Completed by company.

--------------------------------------------------------------- -------------------- ----------------------------------
10     Financial statements for the year ended 31 December       Original            US Guarantor
       1999 for the US Guarantor.
</TABLE>

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

--------------------------------------------------------------------------------
Facility Agreement            Page 66 of 83 Pages
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ITEM                                                            FORM                 RESPONSIBLE
--------------------------------------------------------------- -------------------- ----------------------------------
<S>                                                             <C>                  <C>
11       Initial disclosure statement completed and             Original        Format from the Lender.
         certified by company for the revolving loan                            Completed by company.
         facility only.
-----------------------------------------------------------------------------------------------------------

12       A legal opinion from the company's legal advisers      Original        Company
         regarding the corporate authorisations for
         execution of the Sale and Purchase Agreement, this
         agreement, the fixed and floating charge and the
         operating lease facility.

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

13       The Lender has received all fees payable by the        -               Company
         company under this agreement.

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

14       Evidence of insurance on terms and in amounts          Copy            company
         approved by the Lender and noting the Lender's
         interest.

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

15       Blocked account agreement fully signed, in respect     Original        company
         of all bank accounts operated by the company for
         the revolving loan facility only.

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

16       Release of all security interests over assets of       Original        company
         the obligors other than those approved by the
         Lender.

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

17       Evidence of the corporate structure and capital        Copies          company
         structure of the reporting group.

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

18       Evidence of all authorisations, waivers and            Copies          company
         consents required by government or semi government
         authorities or third parties allowing the obligors
         to enter into the transaction documents on terms
         acceptable to the Lender.
-----------------------------------------------------------------------------------------------------------
</TABLE>

--------------------------------------------------------------------------------
Facility Agreement            Page 67 of 83 Pages
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ITEM                                                            FORM                 RESPONSIBLE
----------------------------------------------------------------------------------------------------------
<S>                                                             <C>                  <C>
19       Statutory declaration as to corporate matters          Original        company
         disclosing matters required by the Lender.

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

20       Legal opinion relating to the US Guarantee.            Original        company

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

21       The  transaction  documents are in full force and      Original        company
         effect and all conditions  precedent  referred to
         there  in  have  been   satisfied   in  form  and
         substance satisfactory to the Lender.

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

22       Evidence of the contribution by the company of         Original        company
         $18,000,000 in new cash equity on acceptable terms

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

23       Evidence of receipt of the purchase price payable
         under the Business Sale Agreement.

-----------------------------------------------------------------------------------------------------------
</TABLE>

-----------------------------------------------------------------------------
Facility Agreement            Page 68 of 83 Pages
<PAGE>

SCHEDULE 2 - INITIAL DRAWDOWN NOTICE (CLAUSE 2.2)
============================================================

                  To:      GE Capital Finance Pty Limited
                           ACN 075 554 175
                           Level 5, 55 Hunter Street
                           Sydney  NSW  2000

                  Attention:        The Account Manager -

                  [DATE]

                  DRAWDOWN NOTICE - A$ FACILITY AGREEMENT BETWEEN ____________
                  AND GE CAPITAL FINANCE PTY ACN 075 554 175DATED [ ] ("FACILITY
                  AGREEMENT")

                  Under clause 2.2 ("Requesting a drawing") of the facility
                  agreement, we give notice that the company wants to borrow
                  under the facility as follows:

                  (a)      the requested drawdown date is ;

                  (b)      the amount of the proposed
                           drawing is A$ ;

                  (c)      the proposed drawing is to be
                           paid to:

                  (d)      the company making the proposed
                           drawing is _________________.

                  _________________ represents and warrants that the
                  representations and warranties by it in clause 12
                  ("Representations and warranties") of the facility agreement
                  are true complete and correct and not misleading on the date
                  of this notice and that each will be true complete and correct
                  and not misleading on the drawdown date and that I am an
                  authorised officer of the company.

                  The Interpretation clause of the facility agreement applies to
                  this notice as if it was fully set out in this notice.

                  ------------------------------------------
                  Signed

                  ------------------------------------------
                  Printed Name
                  being an authorised officer of

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

--------------------------------------------------------------------------------
Facility Agreement            Page 69 of 83 Pages

<PAGE>

SCHEDULE 3 - BORROWING BASE CERTIFICATE
=============================================================================

BORROWING BASE CERTIFICATE
                                            ---------------------------------
                                            Previously faxed: YES      NO
-------------------------- ---------------- ---------------------------------
Company name:              Date:            BBC Number
-------------------------- ---------------- ---------------------------------

I certify that the above information is true and correct and not misleading and
that the eligible accounts in line 6 include only those accounts and inventory
as those terms are defined in the A$ Facility Agreement dated  _____________
 between GE Capital Australia, GE Capital Finance Pty Limited and others..

PREPARED BY:                                    BY:
            -----------------------------------         -----------------------

                                                TITLE:
                                                        ----------------------

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

--------------------------------------------------------------------------------
Facility Agreement            Page 70 of 83 Pages

<PAGE>

SCHEDULE 4 - EXCLUSIONARY CRITERIA
================================================================================

1.       In respect of eligible accounts, the exclusionary criteria excludes any
         account:

         (a)      which does not arise from the sale of goods or the performance
                  of services by the company in the ordinary course of its
                  business;

         (b)      if the company's right to receive payment is not absolute or
                  is contingent;

         (c)      if the company is not able to bring suit or otherwise enforce
                  its remedies against the account debtor through judicial
                  process;

         (d)      to the extent any defence, counterclaim, set-off or dispute is
                  asserted as to the account;

         (e)      if the account represents a progress billing consisting of an
                  invoice for goods sold or used or services rendered pursuant
                  to a contract under which the account debtor's obligation to
                  pay that invoice is subject to the company's completion of
                  further performance under that contract;

         (f)      that is not a true and correct statement of bona fide
                  indebtedness incurred in the amount of the account for goods
                  sold to or services rendered and accepted by the applicable
                  account debtor;

         (g)      with respect to which an invoice, acceptable to the Lender in
                  form and substance, has not been sent to the applicable
                  account debtor;

         (h)      that is not owned by the company;

         (i)      that is subject to any right, claim, security interest or
                  other interest of any other person, other than in favour of or
                  the Lender;

         (j)      that arises from a sale to any officer, other employee,
                  related entity or affiliate of the obligor, or to any entity
                  which has any common officer with the obligor;

         (k)      that is not paid within 90 days following its invoice date;

         (l)      if the relevant account debtor is or becomes insolvent:

         (m)      if the Lender's interest in it is not a first priority
                  perfected security interest;

         (n)      as to which any of the representations or warranties
                  pertaining to accounts set forth in any transaction document
                  is untrue;

         (o)      which is payable in any currency other than Australian
                  Dollars;

--------------------------------------------------------------------------------
Facility Agreement            Page 71 of 83 Pages
<PAGE>

         (p)      that is the obligation of a debtor to whom the company is or
                  may become liable for goods sold or services rendered by the
                  debtor to the company, to the extent of the company's
                  liability to the debtor;

         (q)      that arises with respect to goods which are delivered on a
                  cash-on-delivery basis or placed on consignment, guaranteed
                  sale or other terms by reason of which the payment by the
                  debtor may be conditional;

         (r)      payable by a debtor where the total unpaid accounts of that
                  debtor exceed 20% of the aggregate of all accounts payable to
                  the company at that time, to the extent of that excess;

         (s)      that are accounts of a debtor if 50% or more of the accounts
                  owing from that debtor remain unpaid within the periods
                  specified in (k) for the debtor;

         (t)      that arises from any bill-and-hold or other sale of goods
                  which remain in the company's possession or under the
                  company's control;

         (u)      to the extent that the account exceeds any credit limit
                  established by the Lender in the Lender's sole discretion;

         (v)      that represents interest payments or service charges owing to
                  the company; or

         (w)      which is unacceptable to the Lender in its reasonable credit
                  judgment.

--------------------------------------------------------------------------------
Facility Agreement            Page 72 of 83 Pages

<PAGE>

SCHEDULE 5 - [INTENTIONALLY OMITTED]
================================================================================

--------------------------------------------------------------------------------
Facility Agreement            Page 73 of 83 Pages

<PAGE>

SCHEDULE 6 - DISCLOSURES
================================================================================

1       CLAUSE 12.1 K) - LITIGATION MATTERS

2       [INTENTIONALLY OMITTED]

3       [INTENTIONALLY OMITTED]

4       CLAUSE 12.1 O) - EMPLOYMENT MATTERS

5       CLAUSE 12.1 P) - JOINT VENTURES, SUBSIDIARIES AND AFFILIATES

6       CLAUSE 12.1 Q) - SHARE CAPITAL

                  SHAREHOLDER            SHARES HELD                 FULLY PAID

7       CLAUSE 12.1 R) - INDEBTEDNESS

8       CLAUSE 12.1 S) - TAXES

9       CLAUSE 12.1 U) - INTELLECTUAL PROPERTY

10      [INTENTIONALLY OMITTED]

11      [INTENTIONALLY OMITTED]

12      [INTENTIONALLY OMITTED]

13      [INTENTIONALLY OMITTED]

--------------------------------------------------------------------------------
Facility Agreement            Page 74 of 83 Pages

<PAGE>

SCHEDULE 7 - GUARANTEE AND INDEMNITY (CLAUSE 18.1)
================================================================================

GUARANTEE

         s7.1     The guarantor unconditionally and irrevocably guarantees
                  payment to the Lender of the guaranteed money and guarantees
                  to the Lender the due performance by the company of the
                  company's obligations to the Lender under the transaction
                  documents as a principal obligation. If the company does not
                  pay the guaranteed money on time and in accordance with the
                  transaction documents, then the guarantor agrees to pay the
                  guaranteed money to the Lender on demand. A demand may be made
                  at any time and from time to time and whether or not the
                  Lender has made demand on the company.

NATURE OF GUARANTEE

         s7.2     This guarantee is a continuing obligation and extends to all
                  of the guaranteed money.

INDEMNITY

         s7.3     The guarantor unconditionally and irrevocably indemnifies the
                  Lender as a principal obligation against any liability or loss
                  (including consequential or economic loss) arising, and any
                  costs the Lender suffers or incurs:

                  (a)      if an obligor does not, is not obliged to, or is
                           unable to, pay the guaranteed money in accordance
                           with the transaction documents; or

                  (b)      if the guarantor is not obliged to pay the Lender an
                           amount under clause s7.1 ("Guarantee"); or

                  (c)      if the Lender is obliged, or agrees, to pay an amount
                           to a trustee in bankruptcy or liquidator (of an
                           insolvent person) in connection with a payment by an
                           obligor (for example, the Lender may have to, or may
                           agree to, pay interest on the amount); or

                  (d)      if the guarantor defaults under this guarantee; or

                  (e)      in connection with any person exercising, or not
                           exercising, rights under this guarantee; or

                  (f)      if any obligor defaults under this agreement or any
                           transaction document; or

                  (g)      if the guaranteed money is not recoverable or
                           recovered by the Lender from any obligor.

REINSTATEMENT OF RIGHTS

         s7.4     A trustee in bankruptcy, liquidator or controller or any other
                  person may ask the Lender to refund a payment it has received
                  or otherwise repay money it has received

--------------------------------------------------------------------------------
Facility Agreement            Page 75 of 83 Pages

<PAGE>

                  in connection with this guarantee the guaranteed money or the
                  transactions documents. To the extent the Lender is obliged
                  to, or agrees to, make a refund or repayment it may treat the
                  payment as if it had not been made. It is then entitled to its
                  rights against the guarantor under this guarantee as if the
                  payment had never been made. This applies despite anything in
                  this guarantee.

RIGHTS OF GE CAPITAL ARE PROTECTED

         s7.5     Rights given to the Lender under this guarantee (and the
                  guarantor's liabilities under it) are not affected by any act
                  or omission by the Lender or by anything else that might
                  otherwise affect them under law or otherwise, including:

                  (a)      the fact that it varies or replaces any arrangement
                           under which the guaranteed money is expressed to be
                           owing, such as by increasing the facility limit or
                           extending the term; or

                  (x)      the fact that it releases the company or an obligor
                           or gives it a concession, such as more time to pay or
                           compromises any of the guaranteed money; or

                  (y)      the fact that the company opens an account with it;
                           or

                  (z)      the fact it releases, loses the benefit of or does
                           not obtain any transaction document; or

                  (aa)     the fact that it does not register any transaction
                           document which could be registered; or

                  (bb)     the fact that it releases any person who guarantees
                           any of the company's obligations; or

                  (cc)     the fact that a person becomes a guarantor after the
                           date of this agreement; or

                  (dd)     the fact that the obligations of any person who
                           guarantees any of the company's obligations may be
                           void or may not be enforceable; or

                  (ee)     the fact that any person who was intended to
                           guarantee any of the company's obligations does not
                           do so or does not do so effectively; or

                  (ff)     the death, mental or physical disability or
                           insolvency of any person including an obligor; or

                  (gg)     changes in the membership, name or business of any
                           person; or

                  (hh)     any neglect, omission, default or delay of the
                          Lender.

NO MERGER

         s7.6     This guarantee does not merge with or adversely affect, and is
                  not adversely affected by, any of the following:

--------------------------------------------------------------------------------
Facility Agreement            Page 76 of 83 Pages

<PAGE>

                  (a)      any other guarantee, indemnity, or security interest,
                           or other right or remedy to which the Lender is
                           entitled; or

                  (b)      a judgment which the Lender obtains against the
                           guarantor in connection with the guaranteed money or
                           any other amount payable under this guarantee.

                the Lender may still exercise rights under this guarantee as
                well as under the judgment, other guarantee, indemnity, security
                interest, or other right or remedy.

EXTENT OF GUARANTOR'S OBLIGATIONS

         s7.7     If more than one person is named as "guarantor" each of them
                  is liable for all the obligations under this guarantee both
                  separately on its own and jointly with any one or more other
                  persons named as "guarantor". This guarantee binds each person
                  who signs as "guarantor" even if another person who was
                  intended to sign does not sign it or is not bound by it.

GUARANTOR'S RIGHTS ARE SUSPENDED

         s.7.8    As long as any of the guaranteed money remains unpaid, the
                  guarantor may not, without the Lender's written consent:

                  (a)      reduce its liability under this guarantee by claiming
                           that it or any obligor or any other person has a
                           right of set-off subrogation or counterclaim against
                           the Lender; or

                  (b)      exercise any legal right to claim to be entitled to
                           the benefit of another guarantee, indemnity, or
                           security interest given in connection with the
                           guaranteed money or any other amount payable under
                           this guarantee (for example, the guarantor may not
                           try to enforce any security interest the Lender has
                           taken to ensure repayment of the guaranteed money);
                           or

                  (c)      claim an amount from the company, or another
                           guarantor of the company's obligations, under a right
                           of indemnity or any other claim, or enforce any right
                           against either of them; or

                  (d)      claim an amount in the insolvency of any obligor; or

                  (e)      directly or indirectly withdraw or seek to withdraw
                           any money loaned by the guarantor to the company or
                           otherwise owing to the guarantor by the company or
                           accept or receive any property or payment of the
                           company or take any encumbrance or security interest
                           from the company; or

                  (f)      transfer, assign or otherwise dispose of any claim
                           the guarantor may have against the company other than
                           by way of complete release or make or cause any other
                           person to claim, demand or bring an action against
                           the company directly or indirectly.

--------------------------------------------------------------------------------
Facility Agreement            Page 77 of 83 Pages
<PAGE>

                  Any money, property or other benefit received by the guarantor
                  from the company in contravention of this clause is received
                  on the basis that it is held on trust for the Lender and will
                  be paid to the Lender on receipt by the guarantor.

CROSS GUARANTEE

         s7.9     This guarantee takes effect as a cross-guarantee and
                  cross-indemnity when one or more of the company are the same
                  as one or more of the guarantor. In those circumstances it is
                  a separate guarantee and indemnity in relation to each obligor
                  as if that person were:

                  (s)      the only person included in the definition of
                           "company"; and

                  (t)      excluded from the definition of "guarantor".

--------------------------------------------------------------------------------
Facility Agreement            Page 78 of 83 Pages

<PAGE>

SCHEDULE 8 - FORM OF SUBSTITUTION CERTIFICATE
================================================================================

THIS CERTIFICATE is given on the    day of

BY:               [   ] A.C.N. [     ] (the "EXISTING LENDER");

AND:              [   ] A.C.N. [     ] (the "NEW FINANCIER");

TO:

RECITALS:

A.       Pursuant to clause 20.2 of a Facility Agreement dated [ ] between [ ]
         and others (the "FACILITY AGREEMENT"), the Lender may assign all or
         part of its rights and obligations under the transaction documents.

B.       The Lender proposes to substitute the New Financier for a part of its
         participation under the transaction documents as provided by this
         certificate.

DEFINITIONS

1.1      Defined terms in the Facility Agreement have the same meanings in this
         certificate, unless the context otherwise requires.

1.2      This is a transaction document for the purposes of the Facility
         Agreement.

2.       SUBSTITUTION

2.1      The Lender hereby substitutes the New Financier as Lender under the
         transaction documents to the extent set out below.

2.2      [Details of rights and obligations of the Lender to be assigned].

2.3      The assignment will take effect upon the [date of this notice/[  ] ].

3.       ADDRESS FOR NOTICES

         The address for notices of the New Financier for the purposes of each
         transaction document to which it is a party is [ ].

4.       LAW AND JURISDICTION

         This certificate is governed by the laws of the Australian Capital
         Territory and the parties submit to the non-exclusive jurisdiction of
         the courts exercising jurisdiction in the Australian Capital Territory
         and any courts that may hear appeals from those courts in respect of
         any proceedings in connection with this certificate.

--------------------------------------------------------------------------------
Facility Agreement            Page 79 of 83 Pages

<PAGE>

5.       CAPACITY

         The execution by the Relevant Financier of this certificate binds each
         party, and will cause this certificate to enure for the benefit of each
         party, referred to in clause 20.2 of the Facility Agreement on whose
         behalf it executes this certificate.

        [Lender]                                  [New Financier]

        By:                                       By:
        Date:                                     Date:

        By:
        Date:

--------------------------------------------------------------------------------
Facility Agreement            Page 80 of 83 Pages

<PAGE>

SIGNING PAGE
================================================================================

EXECUTED AS AN AGREEMENT

DATE:  22 November 2000

SIGNED by
as attorney for GE CAPITAL
AUSTRALIA under power of attorney
dated
in the presence of:

/s/ Rebecca King                    /s/ David Thrift
--------------------------------    ------------------------------------------
Signature of witness                By signing this agreement as attorney the
                                    attorney states that the attorney has not
                                    received notice of revocation of the power
                                    of attorney
Rebecca King
--------------------------------
Name of witness (block letters)

225 George St., Sydney NSW 2000
--------------------------------
Address of witness
                                    /s/ B. D. Brown
Soliciter                           -----------------------------------------
---------------------------------   By signing this agreement as attorney the
Occupation of witness               attorney states that the attorney has not
                                    received notice of revocation of the power
                                    of attorney

--------------------------------------------------------------------------------
Facility Agreement            Page 81 of 83 Pages

<PAGE>

SIGNED by

as attorney for
GE CAPITAL
FINANCE PTY LIMITED under
power of attorney dated
in the presence of:

/s/ Rebecca King
--------------------------------   /s/ David Thrift
Signature of witness               ---------------------------------------------
                                   By signing this agreement as attorney the
                                   attorney states that the attorney has not
Rebecca King                       received notice of revocation of the power of
--------------------------------   attorney
Name of witness (block letters)

225 George St., Sydney NSW 2000
--------------------------------   /s/ B. D. Brown
Address of witness                 ---------------------------------------------
                                   By signing this  agreement as attorney the
                                   attorney  states that the attorney has not
Soliciter                          received notice of revocation of the power of
--------------------------------   attorney
Occupation of witness

--------------------------------------------------------------------------------
Facility Agreement            Page 82 of 83 Pages

<PAGE>

EXECUTED by NATIONAL FLEET
NETWORK PTY LIMITED
ACN 094 802 141:

/s/ Geoffrey D. Lewis                           /s/ Kenneth L. Fish
---------------------------------------------   --------------------------------
Signature of director                           Signature of director/secretary

Geoffrey D. Lewis                               Kenneth L. Fish
---------------------------------------------   --------------------------------
Name:  Geoffrey D Lewis                         Name:  Kenneth L Fish

EXECUTED by NMHG DISTRIBUTION PTY LIMITED
ACN 053 370 291:

/s/ Geoffrey D. Lewis                           /s/ Kenneth L. Fish
---------------------------------------------   --------------------------------
Signature of director                           Signature of director/secretary

Geoffrey D. Lewis                               Kenneth L. Fish
---------------------------------------------   --------------------------------
Name:  Geoffrey D Lewis                          Name:  Kenneth L Fish

--------------------------------------------------------------------------------
Facility Agreement            Page 83 of 83 Pages<PAGE>
                                                                   EXHIBIT 10.13

                                 LOAN AGREEMENT

         THIS LOAN AGREEMENT, dated as of June 28, 1996 (this "Agreement"),
between NACCO MATERIALS HANDLING GROUP, INC., a Delaware corporation having its
principal executive offices at 2701 NW Vaughn, Suite 900, Portland, Oregon 97210
(hereinafter called "Borrower"), and NACCO INDUSTRIES, INC., a Delaware
corporation having its principal executive offices at 5875 Landerbrook Drive,
Mayfield Heights, Ohio 44124 (hereinafter called "Lender").

                                   BACKGROUND

         Lender has agreed to loan Borrower an amount not to exceed Fifty
Million Dollars ($50,000,000) for the purposes set forth herein. Lender is
willing to extend such credit, subject to the terms and conditions hereinafter
set forth.

         In consideration of the mutual convenants and agreements contained
herein, and other good and valuable consideration, receipt of which is hereby
acknowledged by all parties hereto, the parties agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

         "AFFILIATE" shall mean a Person (other than Borrower) that directly, or
indirectly through one or more intermediaries, controls or is controlled by, or
is under common control with, Borrower.

         "AUTHORIZED REPRESENTATIVE" shall mean the Chief Financial Officer,
Treasurer or any Assistant Treasurer of Borrower, or any other individual
designated by Borrower in writing to Lender.

         "DEBTOR RELIEF LAWS" shall mean the Federal Bankruptcy Code, together
with any applicable liquidation, conservatorship, bankruptcy, moratorium,
rearrangement, insolvency, reorganization or similar debtor relief laws
affecting the rights of creditors generally from time to time in effect.

         "DEFAULT" shall mean any event specified in Section 6.1 hereof, whether
or not any requirement for the giving of notice, or the lapse of time, or the
happening of any further condition, event or act has been satisfied.

         "DEFAULT RATE" shall mean a rate of interest per annum equal to the
interest rate per annum determined from time to time pursuant to the Note, plus
two percent (2%); provided, however, that in no event shall such rate exceed the
maximum rate allowed by law.

         "DOLLARS" and the sign "$" shall refer to lawful money of the United
States of America.

         "EVENT OF DEFAULT" shall have the meaning assigned to it in Section 6.1
hereof.

         "EXISTING DEBT" shall mean Borrower's debts and liabilities in
existence on the date of this Agreement.

<PAGE>

         "LAWS" shall mean all statutes, laws, ordinances, rules, regulations,
orders, writs, judgments, injunctions, or decrees of the United States, any
state or commonwealth, any municipality, any foreign country, any territory or
possession, or any Tribunal.

         "LITIGATION" shall mean any proceeding, claim, lawsuit and/or
investigation conducted or threatened by or before any Tribunal, including, but
not limited to, proceedings, claims, lawsuits, and/or investigations under or
pursuant to any environmental, occupational, safety and health, antitrust,
unfair competition, securities, tax, or other Laws, or under or pursuant to any
contract, agreement or other instrument.

         "LOAN" OR "LOANS" shall mean any credit extended by Lender pursuant to
the first sentence of Section 2.1 hereof.

         "LOAN PAPERS" shall mean this Agreement, the Note and all other
instruments and documents, if any, to be executed and delivered by Borrower or
any Person pursuant to the terms of this Agreement.

         "MATERIAL ADVERSE CHANGE OR EFFECT" shall mean any act or event or
circumstance which (i) causes an Event of Default or Default, (ii) otherwise
might be material and adverse to the financial condition or business operations
of Borrower, or (iii) in any manner whatsoever could affect adversely the
validity or enforceability of any of the Loan Papers.

         "NOTE" shall mean the promissory note of Borrower delivered to Lender
pursuant to Section 2.1 hereof, or any promissory note delivered thereafter in
substitution therefor.

         "OBLIGATION" shall mean all present and future obligations,
indebtedness and liabilities, and all renewals, modifications, increases or
extensions of all or any part thereof, of Borrower to Lender arising from, by
virtue of, or pursuant to this Agreement, the Note, the other Loan Papers and
any and all renewals, modifications, increases and extensions thereof, or any
part thereof, or future amendments thereto, and all interest accruing on all or
any part thereof, whether such obligations, indebtedness and liabilities are
direct, indirect, fixed, contingent, joint, several, or joint and several.

         "PERSON" shall mean and include an individual, a general or limited
partnership, a joint venture, a corporation, a trust, an unincorporated
organization, and a government or any department, Tribunal, agency or political
subdivision thereof.

         "REQUEST" shall mean the request by Borrower in writing for a Loan in
accordance with Section 2.6 hereof.

         "TAXES" shall mean all taxes, assessments, fees or other charges from
time to time or at any time imposed by any Laws or by any Tribunal.

         "TOTAL PRINCIPAL DEBT" shall mean, at any time, the unpaid principal
balance of the Note.

         "TRIBUNAL" shall mean any state, commonwealth, federal, foreign,
territorial, or other court or governmental department, commission, board,
bureau, agency or instrumentality.

                                      -2-
<PAGE>

                                   ARTICLE II

                                      LOAN

         2.1 FACILITY. Lender agrees, upon the terms and subject to the
conditions of this Agreement, to make a loan or loans to Borrower, as revolving
credit, in such amount or amounts as Borrower may from time to time request, but
not exceeding in the aggregate outstanding at any time under this Agreement,
Fifty Million Dollars ($50,000,000). The obligation of Borrower to repay the
Loans made pursuant to this Section 2.1 shall be evidenced by a note
substantially in the form of Exhibit "A" hereto (the "Note"), dated the date of
this Agreement. Within the limit of the credit provided by the first sentence of
this Section 2.1, and upon the terms and subject to the conditions of this
Agreement, Borrower may borrow, prepay and reborrow under the facility created
hereby. As sums are borrowed or repaid by Borrower pursuant to this facility,
Lender (a) shall revise the grid on the final page of the Note to reflect such
borrowing or repayment, and (b) cause its Chief Financial Officer, the Treasurer
or any Assistant Treasurer or any Assistant Treasurer to initial such changes.

         2.2 PAYMENT OF PRINCIPAL. Lender shall have the right to demand payment
of the Total Principal Debt outstanding in whole or in part at any time, with
twenty-four (24) hours notice. Borrower may prepay the aggregate principal
amount outstanding under the Note in whole or in part at any time, without
penalty.

         2.3 INTEREST ON NOTE. Except as otherwise provided herein, all unpaid
principal under the Note from the dates of any borrowings shown thereon shall
bear interest, and interest shall be due and payable, as provided in the Note;
provided, however, that in no event shall the interest rate on the Note exceed
the highest rate permitted by law.

         2.4 AUTHORIZATION. Each of the Authorized Representatives is hereby
authorized to make borrowings in the name of and on behalf of Borrower and to
receive money pursuant to the terms of this Agreement at any time, and from time
to time, to the full extent of the facility established pursuant to Section 2.1
hereof.

         2.5 PURPOSE. Except as otherwise provided herein, the proceeds of all
Loans may be used for any general corporate purpose of the Borrower, including
investments.

         2.6 BORROWING PROCEDURES. To make a borrowing under the facility
established pursuant to Section 2.1 hereof, Borrower shall submit, by or through
an Authorized Representative, a request in writing for a Loan substantially in
the form of Exhibit "B" hereto (the "Request") to the Chief Financial Officer or
Treasurer of Lender, or any designee of such officers, for a Loan under the
facility in an amount to be specified by such Authorized Representative. Such
Request may be made at any time, and from time to time. Upon receipt of such a
Request, unless a Default has occurred and is continuing, or as otherwise
limited by this Agreement, Lender shall fund the Request.

         2.7 LIMITATION ON BORROWINGS. Notwithstanding any other provision
hereof, Lender shall not be obligated to honor any Request or to fund such Loan
if, in the opinion of Lender's Chief Financial Officer, as evidenced by a
certificate to such effect, the funding of such Loan would have a material
adverse effect on Lender or its business operations.

                                      -3-
<PAGE>

                                   ARTICLE III

                              AFFIRMATIVE COVENANTS

         3.1 GENERAL COVENANTS. During the term of this Agreement, or as long as
any part of the Obligation is outstanding, Borrower covenants that it shall:

         (a) PAYMENT: Duly and punctually pay or cause to be paid the principal
of and interest on the Loans.

         (b) CORPORATE EXISTENCE. Maintain its corporate existence under the
Laws of the State of Delaware in good standing and maintain its rights to
transact business in all other states where the nature of its activities require
it to do so and where the failure to be so qualified would have a Material
Adverse Change or Effect.

         (c) NOTICE OF DEFAULT. Immediately upon the happening of any condition
or event which constitutes a Default, deliver to Lender a written notice
specifying the nature and period of existence thereof and what action Borrower
is taking and proposes to take with respect thereto.

         (d) TAXES, ETC. Duly and punctually pay and discharge, or cause to be
paid and discharged, prior to any default, all valid claims and charges of any
Tribunal of every nature, and all Taxes levied or imposed upon it, unless
contested in good faith and by appropriate proceedings.

         (e) INSURANCE. Procure and maintain in force with financially sound and
reputable insurers, insurance policies with respect to its property and business
against such casualties and contingencies (including but not limited to fire,
public liability, larceny, embezzlement or other criminal misappropriation
insurance) and in such amounts as are usual, customary and then-available for
companies in the same line of business as Borrower.

         (f) MATERIAL ADVERSE CHANGE. Promptly after Borrower becomes aware of
(i) any Material Adverse Change or Effect, or (ii) the pendency or threat of any
Litigation or of any Tax deficiency which, if decided adversely to Borrower,
would have a Material Adverse Change or Effect, give notice to Lender thereof.

         (g) COMPLIANCE WITH OTHER OBLIGATIONS. Perform and observe all
Obligations.

         (h) NOTICE; COMPLIANCE. From time to time, take such steps as may be
necessary or advisable to render fully valid and enforceable under all
applicable Laws the rights of Lender, in each case in such form and at such
times as shall be satisfactory to Lender and its counsel, and pay all fees and
expenses (including attorney's fees) incidental to compliance with this Section
3.1 (h).

         (i) LAWS. Comply with all applicable Laws, and secure or cause to be
secured all necessary approvals or authorizations required in the conduct of its
business where failure to obtain such approvals or authorizations would have a
Material Adverse Change or Effect.

         (j) OTHER INDEBTEDNESS. Duly and punctually pay or cause to be paid all
principal and interest on any debt of Borrower to third parties, comply with and
perform all conditions, terms and obligations of the notes evidencing such debt
and the deeds of trust and mortgages or other security documents securing it.

                                      -4-
<PAGE>

         (k) TAX. If at any time any law shall be enacted imposing or
authorizing the imposition of any Tax upon any of the Loan Papers, or upon any
rights, titles or interests created thereby, or upon the Obligation or any part
thereof, immediately pay all such Taxes.

         (l) INSPECTION. Permit any representatives of Lender to visit and
inspect any of the properties of Borrower, to examine all books of account,
records, reports and other papers, to make copies and extracts therefrom, and to
discuss its affairs, finances and accounts with its officers, employees and
auditors at all such reasonable times and as often as may be reasonably
requested by Lender.

         (m) FURTHER ASSURANCES. Promptly correct any defect, error or omission
which may be discovered in the contents of this Agreement or any of the other
Loan Papers or in the execution or acknowledgment thereof, and execute,
acknowledge and deliver or cause to be executed, acknowledged and delivered such
further instruments and do such further acts as may be necessary or as may be
requested by Lender to carry out more effectively the purposes of this Agreement
and any of the other Loan Papers.

         3.2 ACCOUNTS, REPORTS AND OTHER INFORMATION. During the term of this
Agreement, or as long as any part of the Obligation is outstanding, Borrower
covenants it will maintain a standard system of accounting in accordance with
sound accounting practice, and furnish or cause to be furnished to Lender the
following:

         (a) QUARTERLY STATEMENTS. As soon as practicable after the end of each
fiscal quarter of Borrower, commencing September 30, 1996, and in any event
within 45 days after the end of each such quarter:

         (i) A balance sheet of Borrower as of the end of such quarter; and

         (ii) Statements of income and retained earnings of Borrower for such
quarter, all in reasonable detail and prepared in accordance with sound
accounting practice.

         (b) ANNUAL STATEMENTS. As soon as practicable after the end of each
fiscal year of Borrower, and in any event within ninety (90) days thereafter:

         (i) A balance sheet of Borrower at the end of such year; and

         (ii) Statements of income and retained earnings of Borrower for such
year, all in reasonable detail and prepared in accordance with sound accounting
practice.

         (c) NOTICE FROM REGULATORY AGENCIES. Promptly upon receipt thereof,
information with respect to and copies of any notices received from federal or
state regulatory agencies or any Tribunal relating to an order, ruling, statute
or other Law or information which might have a Material Adverse Change or
Effect.

                                   ARTICLE IV

                               NEGATIVE COVENANTS

         4.1 GENERAL COVENANTS. During the term of this Agreement or as long as
any part of the Obligation is outstanding, Borrower covenants it will not,
without the prior consent of Lender:

                                      -5-
<PAGE>

         (a) DISPOSITION OF ASSETS. Other than in the ordinary course of
business, sell, lease, transfer or otherwise dispose of more than five percent
(5%) in the aggregate of its assets or any of its assets which contribute to at
least five percent (5%) of its gross income; provided, however, that the
foregoing provision (i) shall not be applicable if the proceeds of such sale,
lease or transfer (to the extent such proceeds are not in excess of the
Obligation) are used to prepay the Obligation, or (ii) shall not be applicable
to sales, leases, transfers or other dispositions of any assets of Borrower to
any Affiliate.

         (b) MERGER, ACQUISITION AND CONSOLIDATION. Consolidate or merge with
any other Person, nor permit any other Person to consolidate with or merge into
it; provided, however, that the foregoing shall not apply to any transaction
involving solely one or more Affiliates.

         (c) LIMITATION ON DEBT. Create, incur, assume, become or be liable, in
any manner in respect of, or suffer to exist, any debt (except Existing Debt and
the Obligation) if, when combined with all other debt and liabilities, such debt
would exceed Borrower's surplus.

                                    ARTICLE V

                         REPRESENTATIONS AND WARRANTIES

         5.1 REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants as
follows:

         (a) ORGANIZATION AND QUALIFICATION. Borrower is a corporation duly
organized, validly existing and in good standing under the Laws of the State of
Delaware. Borrower has the corporate power and authority to own the property
that it owns and to carry on the business that it conducts and proposes to
conduct.

         (b) EXECUTION, DELIVERY AND PERFORMANCE. Borrower has the corporate
power and authority to enter into this Agreement, to execute the Note, all other
Loan Papers and all other documents that constitute a part of this Loan
transaction, and Borrower has the corporate power and authority to carry out the
terms and provisions of each of such Loan Papers. This Agreement and the Note
constitute duly authorized, valid and legally binding obligations of Borrower.
The execution and delivery of all of the Loan Papers by Borrower and the
performance by Borrower of the Obligations have been authorized by all corporate
actions necessary to create such authorization.

         (c) LITIGATION. There is no Litigation affecting Borrower that will or
could (whether individually or in the aggregate with other Litigation) have a
Material Adverse Change or Effect.

         (d) CONFLICTING AGREEMENTS AND OTHER MATTERS. No default which could
result in a Material Adverse Change or Effect exists under any order, writ,
injunction, decree or demand of any Tribunal or in the performance or observance
of any obligation, covenant, or condition in any agreement to which Borrower is
bound. Borrower is not a party to or otherwise subject to any contract or
agreement which, absent waiver or consent, would restrict or otherwise affect
the right or ability of Borrower to execute this Agreement or any of the other
Loan Papers or the performance of any of their respective terms other than such
contracts and agreements as to which requisite waivers or consents have been
obtained by Borrower and furnished to Lender. Neither the execution nor delivery
of this Agreement or any of the other Loan Papers, nor fulfillment of, nor
compliance with, their respective terms and provisions, will (i) violate or
conflict with any

                                      -6-
<PAGE>

provision of any Law, determination or award presently in effect by which
Borrower or any of its properties is bound or affected, or any provision of the
Certificate of Incorporation or Bylaws of Borrower (as amended to the date
hereof); (ii) result in any breach of or constitute a default under any
mortgage, deed of trust, indenture, loan or credit agreement or any other
agreement, lease or instrument to which Borrower is a party or by which Borrower
or any of its properties may be bound or affected; (iii) require the consent of
any other Person, except such authorizations, consents, approvals and licenses
as have been obtained by Borrower and furnished to Lender; or (iv) require the
authorization, consent or approval of, or any license from, or any filing or
registration with, any Tribunal, except such authorizations, consents, approvals
and licenses as have been obtained by Borrower and furnished to Lender.

         (e) OTHER AGREEMENTS. Borrower has performed all material obligations
required to be performed by it and is not in material default under any
agreements or other instrument to which it is a party or by which it is bound.

         (f) DISCLOSURE. Neither this Loan Agreement, any of the other Loan
Papers nor any other document, financial statement, projection, credit
information, certificate or statement furnished or required herein to be
furnished to Lender by Borrower in connection with this Agreement contains any
untrue, incorrect or misleading statement of fact, and all of these documents
taken as a whole do not omit to state a fact material to this Agreement, to
Lender's decision to enter into this Agreement or to the transaction
contemplated hereunder. All representations and warranties made herein or in any
certificate, projection or other document delivered to Lender by or on behalf of
Borrower, pursuant to or in connection with this Agreement, shall be deemed to
have been relied upon by Lender, notwithstanding any investigation heretofore or
hereafter made by Lender or on its behalf, and shall survive the making of any
and all Loans contemplated hereby.

                                   ARTICLE VI

                                     DEFAULT

         6.1 DEFAULT. The term "Event of Default," as used herein, means the
occurrence and continuance of any one or more of the following events (including
the passage of time, if any, specified therefor):

         (a) PAYMENTS. The failure or refusal by Borrower to pay the principal
of, or interest on, the Loans or any other fee or obligation created pursuant to
this Agreement, the Note or any of the other Loan Papers on or before ten (10)
days after the date such payment is due.

         (b) OTHER COVENANTS. The failure or refusal by Borrower punctually and
properly to perform, observe and comply with any other covenant, term or
provision contained in this Agreement or any of the other Loan Papers, within
ten (10) days after the obligation to report such failure or refusal to Lender
has occurred.

         (c) VOLUNTARY DEBTOR RELIEF. Borrower shall (i) execute an assignment
for the benefit of creditors, or (ii) admit in writing its inability, or be
generally unable, to pay its debts generally as they become due, or (iii)
voluntarily seek the benefit or benefits of any Debtor Relief Law, or (iv)
voluntarily become a party to any proceeding provided for by any Debtor Relief
Law that could suspend or otherwise affect any of the rights of Lender granted
in this Agreement or any of the other Loan Papers.

                                      -7-
<PAGE>

         (d) INVOLUNTARY PROCEEDINGS. Borrower shall involuntarily (i) have an
order, judgment or decree entered against it by any Tribunal pursuant to any
Debtor Relief Law that could suspend or otherwise affect any of the rights
granted to Lender in this Agreement or any of the other Loan Papers, and such
order, judgment or decree is not stayed or reversed within thirty (30) days
after the entry thereof, or (ii) have a petition filed against it seeking the
benefit or benefits provided for by any Debtor Relief Law that would suspend or
otherwise affect any of the rights granted to Lender in this Agreement or any of
the other Loan Papers, and such petition is not discharged within thirty (30)
days after the filing thereof.

         (e) MISREPRESENTATION. Any statement, representation or warranty in
this Agreement, any of the other Loan Papers, or in any writing at any time
delivered to Lender pursuant to any of such documents, is materially false or
misleading.

         6.2 REMEDIES UPON DEFAULT. If an Event of Default occurs, the aggregate
unpaid principal balance of and accrued interest on the Obligations shall
thereupon become due and payable concurrently therewith, without any action by
Lender and without diligence, presentment, demand, protest, notice of protest or
intent to accelerate, or notice of any other kind, all of which are hereby
expressly waived by Borrower. In lieu of the interest rate established by the
terms of the Note, Borrower shall pay Lender interest at the Default Rate on any
principal outstanding thereunder and on any unpaid interest due thereon from the
date of the Default.

         Upon the occurrence of an Event of Default, Lender may, at its
election, do any one or more of the following:

         (i)      JUDGMENT. Reduce any claim to judgment.

         (ii)     RIGHTS. Exercise any and all rights afforded by the Laws of
                  the State of Ohio or any other jurisdiction, or by this
                  Agreement or any of the Loan Papers, or by Law or equity, or
                  otherwise, as Lender shall deem appropriate.

         (iii)    OFFSET. Exercise the right of offset against the interest of
                  Borrower in and to any funds or property in possession of
                  Lender to the fullest extent of the Obligation.

         (a) PERFORMANCE BY LENDER. Should any covenant, duty or agreement of
Borrower fail to be performed in all respects in accordance with the terms of
the Loan papers, Lender may, at its option, perform, or attempt to perform, such
covenant, duty or agreement on behalf of Borrower. In such event, Borrower
shall, at the request of Lender, promptly pay any amount expended by Lender in
such performance or attempted performance to Lender at Lender's principal
corporate offices, together with interest thereon at the Default Rate from the
date of such expenditure by Lender until paid. Notwithstanding the foregoing, it
is expressly understood that Lender neither assumes nor shall ever have, except
by express written consent of Lender, any liability or responsibility for the
performance of any duties of Borrower hereunder.

         (b) LENDER NOT IN CONTROL. None of the covenants or other provisions
contained in this Agreement or any of the other Loan Papers shall, or shall be
deemed to, give Lender the rights or power to exercise control over the affairs
and/or management of Borrower, the power of Lender under the Loan Papers being
limited to the right to exercise the remedies provided in this Agreement or any
of the other Loan Papers.

                                      -8-
<PAGE>

         (c) WAIVERS. The acceptance by Lender at any time and from time to time
of part payment on the Obligation shall not be deemed to be a waiver of any
Event of Default then existing. No waiver by Lender of any particular Event of
Default shall be deemed to be a waiver of any Event of Default other than said
Event of Default. No delay or omission by Lender in exercising any right
hereunder or under the Loan Papers shall impair such right or be construed as a
waiver thereof or an acquiescence therein, nor shall any single or partial
exercise of any such right preclude other or further exercise thereof, or the
exercise of any other right hereunder or under the Loan Papers or otherwise.

         (d) CUMULATIVE RIGHTS. All rights available to Lender hereunder or
under any of the other Loan Papers shall be cumulative of, and in addition to,
all other rights granted to Lender at Law or inequity, whether or not the
Obligation be due and payable and whether or not Lender shall have instituted
any suit for collection or other action in connection with the Loan Papers.

         6.3 POWER OF ATTORNEY. Effective immediately upon the occurrence of any
Event of Default hereunder, Borrower appoints Lender as Borrower's
attorney-in-fact with full power in Borrower's name and behalf to do every act
which Borrower is obligated to do or may be required to do hereunder; however,
nothing in this Section 6.3 shall be construed to obligate Lender to take any
action hereunder.

         6.4 WAIVERS BY BORROWER. Borrower waives notices of the creation,
advance, increase, existence, extension or renewal of, and of any indulgence
with respect to, the Obligation; waives presentment, demand, notice of dishonor,
and protest; waives notice of the amount of the Obligation outstanding at any
time and all other notices respecting the Obligation; and agrees that maturity
of the Obligation and any part thereof may be extended or renewed one or more
times by Lender in its discretion, without notice to Borrower.

         6.5 RIGHTS AND POWERS OF LENDER. Upon the occurrence of an Event of
Default, Lender, without liability to Borrower, shall be entitled to obtain from
any Person information regarding Borrower or Borrower's business, which
information any such Person also may furnish without liability to Borrower.
Lender shall not be liable for any act or omission on the part of the lender,
its officers, agents or employees, except willful misconduct. The foregoing
rights and powers of Lender will be in addition to, and not a limitation upon,
any rights and powers of Lender given by Law, elsewhere in this Agreement, or
otherwise.

                                      -9-
<PAGE>

                                   ARTICLE VII

                                  MISCELLANEOUS

         7.1 NUMBER AND GENDER OF WORDS. Wherever herein the singular number is
used, the same shall include the plural where appropriate, and vice versa, and
words of any gender shall include each other gender where appropriate.

         7.2 HEADINGS. The headings, captions and arrangements used in this
Agreement and in any of the other Loan Papers are, unless specified otherwise,
for convenience only and shall not be deemed to limit, amplify or modify their
respective terms, nor affect the meaning thereof.

         7.3 ARTICLES, SECTIONS, DESCRIPTIONS AND EXHIBITS. All references to
"Article," "Sections," "subparagraphs" or "subsections" contained herein are,
unless specifically indicated otherwise, references to articles, sections,
subparagraphs and subsections of this Agreement. All references to "hereof,"
"hereto," "hereunder" and similar terms shall refer to this Agreement and not to
any particular section or provision of this Agreement. Any reference to an
"Exhibit" contained herein is a reference to an exhibit attached hereto, which
exhibit is made a part hereof for all purposes, the same as if et forth herein
verbatim. If any exhibit attached hereto which is to be executed and delivered
contains blanks or is otherwise required to be updated from time to time, it
shall be completed correctly and in accordance with the terms and provisions
contained and as contemplated herein prior to, at the time of or after the
execution and delivery thereof.

         7.4 SURVIVAL OF AGREEMENTS. All covenants, agreements, representations
and warranties made herein shall survive the execution and the delivery of this
Agreement or any of the other Loan Papers and shall be deemed to be remade in
connection with each borrowing under Section 2.1 hereof. All statements
contained in any certificate or other instrument delivered by or on behalf of
Borrower in connection therewith, shall be deemed to constitute representations
and warranties made by Borrower.

         7.5 PARTIES IN INTEREST. All convenants and agreements contained in
this Agreement and all other Loan Papers shall bind and insure to the benefit of
the respective successors and assigns of the parties hereto, except that
Borrower may not assign its rights hereunder without the prior written consent
of Lender.

         7.6 GOVERNING LAW. This Agreement and the Note shall be deemed to be
contracts made under the Laws of Ohio and shall be construed and enforced in
accordance with the Laws of Ohio. Without excluding any other jurisdiction,
Borrower agrees that the courts of Ohio will have jurisdiction over proceedings
in connection herewith.

         7.7 INDEMNITY. Borrow agrees to, and does indemnify and hold harmless
Lender against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses and disbursements of any kind
or nature whatsoever which may be imposed on, incurred by, or assessed against
Lender in any way relating to, or arising out of, any of the Loan Papers or any
other transaction contemplated therein, to the extent that any of the same
results, directly or indirectly, from any claims made or actions, suits or
proceedings commenced by or on behalf of any Person other than Lender. The
obligation of Borrower under this Section 7.7 shall survive termination of this
Agreement.

                                      -10-
<PAGE>

         7.8 SEVERABILITY. If any provision of this Agreement or any of the
other Loan Papers is held to be illegal, invalid or unenforceable under present
or future Laws during the term thereof, such provision shall be fully severable,
the appropriate Loan Paper shall be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part thereof, and the
remaining provisions thereof shall remain in full force and effect and shall not
be affected by the illegal, invalid or unenforceable provision or by its
severance therefrom. Furthermore, in lieu of such illegal, invalid or
unenforceable provision there shall be added automatically as a part of such
Loan Paper a provision as similar in terms to the illegal, invalid or
unenforceable provision as may be possible and legal, valid and enforceable.

         7.9 AMENDMENT. The provisions of this Agreement and the other Loan
Papers may not be amended, modified or waived except by the written agreement of
Borrower and Lender.

         7.10 ENTIRE AGREEMENT. This Agreement and the other Loan Papers embody
the entire agreement among the parties and supersede all prior agreements and
understanding, if any, relating to the subject matter thereof.

         7.11 EXCEPTIONS TO COVENANTS. Borrowers shall not be deemed to be
permitted to take any action or fail to take any action which is permitted as an
exception to any of the covenants contained herein or which is within the
permissible limits of any of the covenants contained herein if such action or
omission would result in the breach of any other covenant contained herein.

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

BORROWER:                               NACCO MATERIALS HANDLING GROUP, INC.
5875 Landerbrook Drive
Mayfield Heights, Ohio  44124           By /s/ Jeffrey C. Mattern
Attention:  Chief Financial Officer        -------------------------------------
                                        Its  Treasurer
                                            ------------------------------------

LENDER:                                 NACCO INDUSTRIES, INC.
5875 Landerbrook Drive                  By /s/ J. C. Butler
Mayfield Heights, Ohio  44124              -------------------------------------
Attention:  Treasurer                   Its:  Treasurer
                                            ------------------------------------

                                      -11-
<PAGE>

                               Fluctuating Balance

                                 Promissory Note

                                                            June 28, 1996

         FOR VALUE RECEIVED, the undersigned NACCO Materials Handling Group,
Inc., a Delaware corporation ("Borrower"), hereby promises to pay to the order
of NACCO Industries, Inc., a Delaware corporation ("Lender"), upon demand, at
the principal executive offices of Lender in the City of Mayfield Heights, Ohio
(or such other address as Lender shall hereinafter designate in writing), in
lawful money of the United States of America, the principal sum of Fifty Million
Dollars ($50,000,000) or, if less, the last amount appearing in the "unpaid
principal balance" column of the grid attached hereto as EXHIBIT A, and to pay
interest on the unpaid principal balance hereof from time to time outstanding
from the date hereof to maturity, whether by acceleration or otherwise, on
September 30, 1996 and on each December 31, March 31, June 30 and September 30
thereafter (each, an "Interest Payment Date"; each period commencing on the day
immediately following an Interest Payment Date and ending on the immediately
following Interest Payment Date being an "Interest Period"). Interest hereon
shall be calculated on the basis of a 360 day year consisting of twelve 30 day
months, and shall be calculated at a rate per annum equal to the interest rate
calculated pursuant to the terms of the Amended and Restated Credit Agreement
dated as June 4, 1996 among NACCO Materials Handling Group, Inc., the Banks
party thereto, the Co-Arrangers and Co-Agents listed on the signature pages
thereof and Morgan Guaranty Trust Company of New York, as Agent (the "Credit
Agreement"). The interest rate will be calculated and fixed on the first day of
each Interest Period and compounded daily through each Interest Period. Lender
shall have the right to demand payment of the unpaid principal balance
hereunder, in whole or in part, at any time, and Borrower shall have the right
to prepay, in whole or in part, the unpaid balance hereunder at any time.

This Note evidences borrowings under a Loan Agreement dated as of June ___, 1996
between Borrower and Lender, to which reference is hereby made for a statement
of the terms and conditions applicable to the Note.

                                    NACCO Materials Handling Group, Inc.

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

Attest:

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

<PAGE>

                                                                       Exhibit A
                                                                       ---------

<TABLE>
<CAPTION>
----------------------- --------------------- -------------------- --------------------- --------------------
                             PRINCIPAL                                   AGGREGATE
                              AMOUNT                PRINCIPAL            PRINCIPAL            APPROVED BY
         DATE                ADVANCED              AMOUNT PAID          OUTSTANDING             LENDER
----------------------- --------------------- -------------------- --------------------- --------------------
<S>                     <C>                   <C>                  <C>                   <C>

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

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</TABLE>

<PAGE>

                      NACCO MATERIALS HANDLING GROUP, INC.
                                PORTLAND, OREGON

                        Request for Loans and Certificate
                  Pursuant to Section 2.6 of the Loan Agreement
                                   Dated as of

To:      NACCO Industries, Inc.
         Mayfield Heights, Ohio

         The undersigned hereby requests a loan under the Loan Agreement in the
amount of ___________ to be made on _______________ and to be evidenced by the
undersigned's Note.

         In support of this request, the undersigned hereby certifies that:

         1.       The representation and warranties made by the Borrower in
                  Section 5.1 of the Loan Agreement are true and correct on and
                  as of this date.

         2.       No Event of Default set forth in Section 6.1 of the Loan
                  Agreement, and no event which might become such an Event of
                  Default after the lapse of time or the giving of notice and
                  the lapse of time, has occurred and is continuing or will
                  exist upon the disbursement of such loan.

         EXECUTED this               day of                             , 199  .
                       -------------       ----------------------------      --

                                            NACCO MATERIALS HANDLING GROUP, INC.

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

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