Document:

Exhibit 10.2

                                PURCHASE CONTRACT

                  THIS  AGREEMENT  made and entered  into this 20th day of April
2000, between CORNERSTONE REALTY GROUP, INC. or its nominee, (hereinafter called
"Purchaser") and GREYSTONE  CROSSING  APARTMENTS,  LLC, a North Carolina limited
liability company,  and GCA-II, LLC, a North Carolina limited liability company,
(hereinafter GREYSTONE CROSSING APARTMENTS, LLC and GCA-II, LLC are collectively
called "Seller").

                                    ARTICLE I
                                  THE PROPERTY

                  1.1 SALE OF PROPERTY.  Seller  agrees to sell and convey,  and
Purchaser agrees to purchase, Seller's real property known as GREYSTONE CROSSING
APARTMENTS located in Charlotte, NC, with all buildings and improvements located
thereon,  as more  particularly  described in the attached legal  description in
EXHIBIT  A  including,  but  not  limited  to 408  individually  heated  and air
conditioned  apartment  units  (Phase I  comprised  of 300  units  and  Phase II
comprised of 108 units),  with all appurtenances,  together with all appliances,
drapes, carpeting,  shrubbery and all other personal property used in connection
with the premises,  including, the inventory of personal property to be supplied
by Seller and attached hereto as EXHIBIT B (all such real and personal  property
hereinafter  collectively  referred  to as the  "Property"  unless  the  context
clearly indicates otherwise).

                                   ARTICLE II
                            PAYMENT OF PURCHASE PRICE

                  2.1 PURCHASE  PRICE.  The total purchase price shall be TWENTY
SIX MILLION EIGHT HUNDRED THOUSAND ($26,800,000) DOLLARS as evidenced by cash or
cash  equivalent at closing.  The parties  agree to allocate the purchase  price
among the purchased assets for federal and state tax purposes in accordance with
EXHIBIT C.

                  2.2 DEPOSIT.  ONE HUNDRED  THOUSAND  ($100,000)  DOLLARS to be
placed in escrow at the end of the "Inspection  Period"  described in Article VI
below.  Said deposit  shall be placed in escrow with the Title  Company of North
Carolina  or its  authorized  agent as an  earnest  money  deposit  which may be
credited  against the  purchase  price or applied as per  Article XI below.  Any
interest  which shall accrue with  respect to said deposit  shall accrue for the
benefit of Purchaser.

                                   ARTICLE III
                                  TITLE MATTERS

                  3.1 Marketable Title. Seller, shall convey good and marketable
title by  Special  Warranty  Deed,  in the form  attached  hereto as  EXHIBIT D,
subject  only to general  taxes

<PAGE>

for the current year not yet due and payable and utility  easements which do not
interfere  with the present use of the  Property  and the  exceptions  listed on
EXHIBIT G hereto ("Permitted Exceptions").

                  (A) Title  shall be free  from any and all liens or  mortgages
(other  than  Permitted  Exceptions)  and Seller  shall be  responsible  for any
prepayment penalties necessary to deliver such free title.

                  3.2 TITLE DEFECTS;  ELECTION TO CURE.  Seller shall deliver to
Purchaser a copy of its previous title  insurance.  If title is not  marketable,
except as stated above in the preceding paragraph,  Purchaser shall give written
notice of any  defects in title to Seller's  counsel  within  fifteen  (15) days
after Purchaser's receipt of a title report which report shall include copies of
backup  documents  relating to any title  exceptions,  a current survey, a flood
zone certification letter and a Surveyor's  Certification letter. Seller may, at
its option, elect whether to cure said defects or by written notice to Purchaser
indicate its intention not to cure.

                  3.3 ELECTION NOT TO CURE  DEFECTS.  Should Seller elect not to
cure title defects,  this Agreement,  at Purchaser's option, shall be void; each
party  shall  thereupon  be released  from all  obligations  hereunder;  and all
deposits shall be immediately returned to Purchaser. If Purchaser does not elect
to void this  Agreement,  such defects shall become  Permitted  Exceptions  with
respect to the Property.

                                   ARTICLE IV
                                   PRORATIONS

                  4.1 INCOME AND EXPENSE  ALLOCATIONS.  The  following  shall be
prorated,  on a  calendar-month  basis,  to the day of closing:  rents and other
income from the  Property;  operating  expenses (on such service  contracts  and
other  obligations  as  Purchaser  may agree to  assume);  and  general and real
property taxes and personal and business  property taxes for the year of closing
(based on the most recent assessment and the most recent levy).

                  4.2  CLOSING  COSTS.  Purchaser  and  Seller  shall  pay their
customary  share of all taxes.  Seller shall pay the costs of revenue stamps and
recording fees imposed on the Deed or any other documents executed in connection
with  the  transfer  of the  Property.  Purchaser  agrees  to pay  cost of title
insurance. Seller shall pay any prepayment penalty charged by the holders of any
existing notes.

                  4.3  ALLOCATION OF RENTS.  Rents  collected by Seller prior to
Closing  shall be prorated as agreed in 4.1 above.  Purchaser  shall apply rents
received  after  Closing  first to payment of the current rent due to Purchaser,
then to delinquent rents due to Purchaser, and last to rents due to Seller as of
the Closing but  uncollected  prior to settlement.  Purchaser  agrees to use its
best  efforts  in good faith to collect  the amount of any rental  arrears  from
tenants  and  Purchaser  agrees to remit  promptly  to Seller  any such  arrears
actually  paid by such  tenants to

                                       2
<PAGE>

Purchaser.  Seller  shall retain the right to commence  legal  action  against a
tenant for any delinquent rent apportioned to the Seller.

                  4.4 PRIOR LEASE  CONCESSIONS.  If Seller has committed to give
any future  monetary  concessions  to  tenants  under  existing  leases to which
Purchaser would become liable, then Seller shall pay to Purchaser said amount in
a lump sum at closing.

                                    ARTICLE V
                           POSSESSION OF THE PROPERTY

                  5.1 POSSESSION.  Possession of the Property shall be delivered
to Purchaser  at closing,  subject to the rights of the tenants  under  existing
leases and rental agreements.

                                   ARTICLE VI
                         CONDITIONS PRECEDENT TO CLOSING

                  6.1  CONDITIONS  PRECEDENT.   (a)  Purchaser's  obligation  to
purchase  shall  be  subject  to and  contingent  upon the  satisfaction  of the
following conditions precedent:

                           (A) Receipt by Purchaser of an engineering  report of
building and site conditions (ordered by Purchaser at its expense), satisfactory
to  Purchaser  in its sole  discretion,  said  report  to  include  in  part,  a
description  of any hazardous  waste sites,  hazardous  wastes and/or  hazardous
materials  affecting the property.  Purchaser  shall have  twenty-one (21) days,
pursuant to Paragraph 6.2.4, in which to review the reports set forth herein and
exercise its right to reject the Property  based thereon or the right  hereunder
shall be deemed waived. At Seller's request,  Purchaser will provide to Seller a
copy of each engineering  report prepared in connection with the Property at its
actual cost.

                           (B) The  receipt  by  Purchaser  of Seller  documents
described in 7.2 below.

                           (C) On the condition that Sellers representations and
warranties described in Article VIII below remain true and correct.

                           (D) On the condition that there have been no material
and adverse changes to the property or leases.

                           (E) Seller  acknowledges  that  Purchaser is a public
entity and that it is required to furnish financial statements to the Securities
and Exchange  Commission in connection with this  acquisition.  Seller agrees to
make the  information  available  for  Purchaser  to audit the last 12 months of
operation  of  the  Property  so  that a  report  can be  generated  that  is in
compliance  with  accounting  Regulation  S-X of  the  Securities  and  Exchange
Commission.

                                       3
<PAGE>

                           (F) Survey which shall show no encroachments onto the
Land  from any  adjacent  property,  no  encroachments  by or from the Land onto
adjacent  property  and no  violation  of or  encroachments  upon  any  recorded
building lines,  restrictions or easements affecting the Property. If the Survey
discloses any such encroachment or violation, Seller shall have thirty (30) days
from the date of delivery of the Survey  (with a  commensurate  extension of the
closing date) to have the Title Insurer issue its endorsement  insuring  against
damage caused by such  encroachment or violation and to provide evidence thereof
to  Purchaser,  and if Seller  fails to or is  unable  to have the same  insured
against  within such thirty (30) day period,  Purchaser may elect,  on or before
the Closing  Date, to (i)  terminate  this  Agreement (in which case the Earnest
Money shall be returned to  Purchaser)  and neither party shall have any further
liability  or  obligation  to the other  hereunder,  or (ii) accept the property
subject to any such encroachment or violation.

                  6.2 INSPECTION. This Agreement shall be further subject to and
contingent upon Purchaser's satisfactory inspection as follows herein below.

                  6.2.1  PREPARATION FOR  INSPECTION.  Within three (3) business
days of the  execution  of this  Agreement,  Seller  shall  deliver to Purchaser
copies  of the  following:  The  current  rent roll for the  Property;  detailed
statements  of income and expenses with respect to the Property for the past two
years;  the most  recent  tax  bills  for the  Property;  utility  bills for the
Property for the twelve (12) months  previous to the date hereof;  all contract,
mortgages,  and other  documents  creating  liens of  security  interest  on the
Property,  or any part thereof and all  promissory  notes secured  thereby;  all
insurance policies  applicable to the Property to include loss runs for the last
five (5) years; Plans and  Specifications  for the Property,  service contracts,
Certificates of Occupancy,  to the extent  reasonably  available;  a copy of the
title  policy  and  most  recent  survey  for  the  Property.   A  copy  of  any
environmental or engineering  reports on the property.  All these items shall be
certified by Seller to be accurate and complete in all material  respects to the
best of its knowledge and belief.

                  6.2.2 INSPECTION OF BOOKS AND RECORDS; ACCESS. Upon receipt by
Purchaser of all documents  requested in the  paragraph  above,  Purchaser,  its
employees,  agents and contractors shall have 21 days (the "Inspection  Period")
to enter upon the Property  subject to the rights of the tenants  during  normal
business hours for the purpose of making physical inspections thereof, including
but not limited to roofs,  heating,  cooling,  electrical and plumbing  systems,
swimming pool, appliances,  and structural elements of the buildings.  Purchaser
shall also be permitted to review all original leases,  expense records,  tenant
cards and occupancy data available. Upon the conclusion of the Inspection Period
this  contract  shall be  deemed to be a firm  agreement  of  purchase  and sale
binding the parties hereto,  except as it may be terminated by other  provisions
and  conditions  contained  herein,  including  but not limited to the condition
imposed by Paragraph 6.1(A) above.

                  6.2.3  RIGHT  OF  TERMINATION  DURING  INSPECTION  PERIOD.  If
Purchaser is not satisfied, in its sole and exclusive discretion, with the state
of maintenance and repair of the Property or the rents, occupancy or expenses of
the Property,  or for any other reason, then

                                       4
<PAGE>

notwithstanding anything contained herein to the contrary,  Purchaser shall have
the right to terminate  this Agreement by giving written notice to Seller before
the end of the  Inspection  Period,  and no party  hereto shall have any further
liability  to any other  party  hereto,  and all  deposits  shall be returned to
Purchaser.

                  6.2.4  TERMINATION  OF  INSPECTION   PERIOD.   Notwithstanding
anything to the contrary set forth herein,  the  Inspection  Period shall expire
twenty-one  (21) days from the date of this  Agreement or such other date as the
parties may agree to in writing.

                  6.2.5  "RENT  READY".  During the  "Inspection  Period",  both
Seller and Purchaser  will inspect a vacant  apartment  unit at the Property and
mutually agree that said  apartment  shall be  representative  of a "rent ready"
unit by which all other vacant units shall be judged for "rent ready"  condition
at closing.  All vacant  apartment  units, are to be in a "rent ready" condition
(as defined above), at the time of closing,  containing,  but not limited to the
following  amenities,  i.e.,  carpet,  refrigerator,  range,  garbage  disposal,
heating, plumbing and electrical systems.

                  6.2.6 CONDITION OF PERSONAL PROPERTY AT CLOSING.  All personal
property  included  in the sale and all  mechanical,  electrical,  heating,  air
conditioning,  sewer,  water and  plumbing  systems  will be in the same working
order at the time of  closing  and in the same  condition  as at the time of the
initial  inspection by Purchaser.  If Seller fails to make reasonable efforts to
conserve  the  property,  Purchaser  shall  have  the  option  of  waiving  such
requirement,  in writing,  and proceeding to closing, or Purchaser may void this
Agreement and obtain a prompt return of its deposit.

                                  ARTICLE VII
                                    CLOSING

                  7.1  CLOSING.  Closing  will be held  seven (7) days after the
completion  of the  Inspection  Period,  at such  place  and at such time as the
parties may agree.

                  7.2 SELLER'S DELIVERIES.  At closing, Seller shall execute and
deliver to Purchaser the Special Warranty Deed referred to in Paragraph 3 hereof
and  shall  also  execute,  where  necessary,  and  deliver  to  Purchaser,  the
following:

                           (A) A Bill of Sale,  in the form  attached  hereto as
EXHIBIT E, with warranty of title  transferring the personal  property (as shown
in Exhibit B) to Purchaser free of all liens, charges and encumbrances.

                           (B)  Originals  or copies of all  signed  leases  and
rental agreements in effect with tenants of the Property.

                           (C) All security and cleaning  deposits  made by such
tenants.  Seller will give the tenants the required  notice of such  transfer in
compliance with the laws of NORTH

                                       5
<PAGE>

CAROLINA.

                           (D) An affidavit of Seller in such form as will cause
the Title Company to omit from the title insurance policy the exclusion relating
to unrecorded mechanic's and materialmen's liens.

                           (E) A rent  roll  certified  by Seller to be true and
correct in all material  respects as of the date of closing showing the name of,
and the amount of monthly rental  payable,  by each tenant of the Property,  the
apartment  occupied  by the  tenant,  the date to which rent has been paid,  any
advance  payment of rent, and the amount of any escrow,  or security  deposit of
tenant.

                           (F) An  affidavit  of Seller  that to the best of its
information  and  belief  there  are,  on the date of  closing,  no  unsatisfied
judgments,  creditor's  claims,  tax liens,  or pending  bankruptcies  involving
Seller.

                           (G)  Seller  shall  provide  a  certificate   from  a
licensed extermination  contractor,  who is regularly engaged in the business of
pest control,  that all buildings are free from any termite or other wood-boring
insect  infestation.  Said certificate shall be dated within 90 days of closing,
bearing the Contractor's name,  contractors license number, the signature of the
party  authorized  to sign for the  Contractor  and the date of the  inspection.
Should damage exist,  Seller shall proceed to have any corrective work completed
prior to closing or Purchaser,  at its option,  may either proceed to settlement
and have such sums required for repairs deducted from Seller's proceeds,  or may
in its sole discretion  terminate this  Agreement.  Seller shall promptly return
Purchaser's deposit upon such termination.

                           (H)  Assignments  of  all  Seller's  interest  in the
following: (1) all assignable licenses, and permits relating to the operation of
the Property, (2) the leases and rental agreements with tenants of the Property,
(3) the existing  Property  telephone number and (4) the business and trade name
as set forth in Par. 1.1.

                           (I)  Assignments  of all warranties and guarantees to
the extent  such are still in effect and  provide  Purchaser  with copies of all
such   warranties  and  guarantees   without   limitation  for  all  appliances,
dishwashers, disposals, refrigerators, heating and air conditioning units.

                           (J)  Evidence  satisfactory  to  Purchaser  that  all
water,  sewer, gas, electric,  telephone,  and drainage facilities and all other
utilities required by law or by the normal use and operation of the Property are
and at the time of closing will be installed  to the property  line,  are and at
the time of closing will be connected pursuant to valid permits,  and are and at
the time of  closing  adequate  to  service  the  Property  and to  permit  full
compliance with all  requirements of law and normal usage of the Property by the
tenants thereof and their licensees and invitees.

                                       6
<PAGE>

                           (K) Consent of the Seller's authorized officer to the
sale of the Property and any other approvals required under Seller's articles or
by-laws, which may affect Seller's ability to convey marketable title.

                           (L)  Provide   documents  for  the  transfer  of  the
telephone,  electric,  water and sewer, and gas utilities, as may be required by
the utility, for execution at closing.

                           (M) Satisfactory  evidence of the power and authority
of Seller to enter into and consummate this agreement, including but not limited
to:

                                    (i) An opinion  of  Seller's  counsel,  in a
form satisfactory to Purchaser, stating that:

                                             (a) The individual(s) executing the
deed and  related  documents  are  duly  authorized  to do all such  acts as are
necessary to consummate this sale.

                                             (b) That the officer of the manager
of the Seller can bind the Seller.

                           (N) Affidavit that Seller has no actual  knowledge of
the presence of asbestos and/or any other hazardous material at the Property.

                           (O) Seller  shall  provide a  satisfactory  and valid
written  termination  of the  management  agreement  executed  by  the  existing
management and rental agent for the Property, without cost to the Purchaser.

                           (P) A  notice  letter  to all  the  residents  of the
apartment  complex  as to  change  of  ownership  in the  form  prepared  by the
Purchaser.

                           (Q)  All  such  other   documents   as  are  normally
transferred at settlement in the  jurisdiction  in which the property is located
or are reasonably requested by Purchaser or its counsel.

                           (R) A representation  letter as normally  required by
auditors  for a public  company in the form  attached  hereto as EXHIBIT F. This
clause shall survive closing for one year.

                  7.3 Purchaser's  Deliveries.  At closing and contemporaneously
with the Seller's  compliance  with the  provisions  of Section  7.2,  Purchaser
shall:

                           (A) Pay to Seller the cash  portion  of the  purchase
price,  adjusted  for the  prorations,  allocations  and  closing  costs  herein
provided  for  in  Article  IV.  However,  it is  understood  that  SIX  MILLION
($6,000,000)  DOLLARS of said purchase  price shall be placed

                                       7
<PAGE>

in escrow with Ted  Oliver,  Esq.  ("Escrow  Holder"),  with  offices at 500 UCB
Plaza, 3605 Glenwood Avenue,  Raleigh,  NC 27612, as agent for the Title Company
of  North  Carolina,  subject  to the  terms  set  forth in  Article  VIII in an
interest-bearing  account with interest thereon to accrue for the benefit of the
Purchaser.

                           (B) Execute and deliver an assumption of  obligations
under leases,  securities,  any contracts which may be accepted by the Purchaser
and any other obligations specifically set forth herein.

                           (C)  Deliver  to  the  Seller  a  resolution  of  the
Purchaser that:

                                    (i) This Agreement has been duly authorized,
executed and delivered by the Purchaser and is a valid and binding  agreement of
Purchaser, and

                                    (ii)  Purchaser  has  complete  unrestricted
power to buy the Property from the Seller and to execute any documents  required
to effectuate the transfer.

                                  ARTICLE VIII
                                 PHASE II ESCROW

                  8.1  CONDITIONS  OF  ESCROW.  It is  understood  that  the SIX
MILLION  ($6,000,000)  DOLLARS  escrow  referred  to in Article  VII,  Paragraph
7.3(A),  will be delivered to Escrow Holder at the time of closing.  Said escrow
shall be placed in an interest-bearing  account,  which interest shall accrue to
the benefit of the Purchaser.  Said escrow, without the interest earned thereon,
is to be released to the Seller upon the following terms and conditions:

                           (A) Completion of the "punch list" items for Phase II
as set forth in EXHIBIT H. Upon completion of the "punch list" items, in Exhibit
H, Seller shall give written notice of completion to Purchaser.  Purchaser shall
provide  Seller with written  notice that  Purchaser  agrees that Seller has, in
fact,  completed  the "punch  list" items in Exhibit H within ten (10) days from
receipt of Seller's notice of completion.

                           (B) Phase II shall have  achieved  eighty-five  (85%)
percent occupancy.

                           (C) Upon compliance with the above items (A) and (B),
then  within  seven (7) days after  Escrow  Holder  shall have been  notified in
writing and  instructed  by both parties to terminate the escrow and deliver the
SIX MILLION ($6,000,000) DOLLARS to the Seller. However, the escrow shall not be
delivered  for a minimum of sixty (60) days with an  automatic  extension  of an
additional thirty (30) days unless Purchaser shall have previously  notified the
Escrow Holder otherwise.  Notwithstanding the foregoing,  however, provided that
Section  8.1(A) has been  satisfied  by Seller,  the escrow shall be released no
later than ninety (90) days after closing.

                                       8
<PAGE>

                                   ARTICLE IX
               SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS

                  9.1  REPRESENTATIONS  OF THE PARTIES.  Seller  warrants (which
warranties shall not survive  settlement unless designated to the contrary) that
as of the date of closing hereof:

                           (A) That  Seller,  is the owner in fee  simple of the
Property and has the power to convey same.

                           (B)  That   Seller  is  not   subject  to  any  other
agreements  or  arrangements,  with  the  exception  of those  contained  in any
existing mortgage documents which would prevent Seller from selling the Property
to Purchaser. This warranty shall survive for one year following closing.

                           (C) All necessary  action has been taken by Seller to
authorize the execution of this Agreement and the performance of the obligations
contemplated  hereunder,  which are not excluded  elsewhere in existing mortgage
documents. This warranty shall survive for one year following closing.

                           (D) Seller has no actual  knowledge  and has not been
advised in  writing  that it is in default  under any  lease,  rental  agreement
service or equipment contract, or mortgage or other encumbrances relating to the
Property. This warranty shall survive for one year following closing.

                           (E) Seller has no actual  knowledge  of any  material
patent or latent defect in the Property or any part thereof. This warranty shall
survive for one year following closing.

                           (F) Seller has no actual knowledge of any existing or
threatened litigation which relates to or which would affect the Property.  This
warranty shall survive for one year following closing.

                           (G) The  Property  abuts on and has direct  vehicular
access to a public road.

                           (H)  All  building  and  other  improvements  at  the
Property are located entirely within the boundary lines of the Property.

                           (I) Seller has no actual  knowledge  that any part of
the Property or the operation of the Property,  is in material  violation or may
materially violate any governmental statute,  regulation,  ordinance or building
code or of any private restriction, that any governmental authority requires any
work to be done on or affecting the Property, or that any governmental

                                       9
<PAGE>

authority has expressed an intent to condemn or to make special improvements for
the benefit of the Property or any part thereof. This warranty shall survive for
one year following closing.

                           (J) That to the best  knowledge  of the  Seller,  the
drainage  within the project is  satisfactory  and complies in all respects with
all  government  regulation.  This warranty shall survive for one year following
closing.

                           (K) That Seller is not a "foreign  person" within the
meaning of the Internal Revenue Code of 1986, as amended (the "Code"),  and that
Seller  will  furnish  to  Purchaser  prior  to  closing  an  affidavit  in form
satisfactory to Purchaser confirming the same.

                           (L)  That to the  best  of  Seller's  knowledge,  the
Property was never utilized as a disposal site for hazardous  waste products and
will furnish to Purchaser an affidavit confirming same.

                           (M) Seller  covenants  and agrees that,  between this
date and the date of closing,  Seller shall  continue to  maintain,  operate and
manage the  Property in a manner  consistent  with its prior  practices,  making
every  reasonable  effort to do nothing which might damage the reputation of the
Property or the  relationships  with the  tenants.  Seller  shall not permit the
modification,   extension  or  cancellation  of  any  tenant  lease  (except  in
accordance  with the terms of such lease) or any dealing  with any tenant  other
than the ordinary  course of managing the  Property,  without the prior  written
consent of  Purchaser.  If the leases of any tenants  expire  before thirty (30)
days after the date of  closing,  Seller  shall,  up to the date of closing  and
without  cost to the  Purchaser,  continue its normal  course of operation  with
respect to causing tenants to be obtained for apartments which are unrented.

                  9.2 CONTINUATION OF REPRESENTATIONS,  WARRANTIES AND COVENANTS
TO THE DATE OF CLOSING. If each of the warranties set forth in this section does
not remain  true up to and  including  the time of  closing  as to any  material
matters, this Agreement,  at Purchaser's election,  shall be terminated,  Seller
shall return all payments made by Purchaser, or Purchaser may elect to close the
sale and waive failure of the  warranties.  If Purchaser shall have knowledge at
closing of the breach of a representation,  warranty, covenant or agreement made
for its benefit  herein or in any other document  delivered  herewith and elects
not to  terminate  this  Agreement  but proceed to closing,  Purchaser  shall be
deemed to have waived the breach of such representation,  warranty,  covenant or
agreement and Seller shall have no liability with respect thereto.

                  9.3  BREACH  OF  REPRESENTATIONS,  WARRANTIES  AND  COVENANTS.
Notwithstanding  the provisions of 9.2 above,  Seller shall indemnify  Purchaser
for all reasonable  costs incurred as a result of the failure of any of Seller's
representations,  warranties or covenants contained herein to remain true as of,
which failure occurs between the date of closing from the date of termination of
the Inspection Period and the date of closing.

                                       10
<PAGE>

                                    ARTICLE X
                           CONDEMNATION; RISK OF LOSS

                  10.1 PROPERTY  DAMAGE.  If, prior to closing,  any part of the
Property is damaged by fire or other  casualty in an amount not greater than TWO
HUNDRED  THOUSAND  ($200,000)  DOLLARS,  Purchaser agrees to accept the Property
with an assignment  of: (i) the insurance  proceeds,  (ii) any  deductible,  and
(iii) rent loss insurance proceeds.  Seller shall have the option to repair such
damage before the date provided herein for Closing. In the event that the damage
as a result of fire or other  casualty  cannot be  reasonably  repaired  by such
time,  this  Agreement  may be canceled at the option of the  Purchaser.  In the
event of  cancellation  as aforesaid,  this Agreement shall become null and void
and the  parties  shall be released  and all  payments  made shall be  returned.
Should  Purchaser  elect to carry out this Agreement  despite such damage Seller
shall assign to Purchaser all insurance proceeds and any deductible arising from
such  damage and will  compensate  Purchaser  for lost rent  collections  to the
extent of insurance proceeds received. Seller shall promptly notify Purchaser in
writing upon the occurrence of any such damage.

                  10.2  CONDEMNATION.  In the event of any actual or  threatened
taking, pursuant to the power of eminent domain, all or any part thereof, or any
actual or proposed  sale in lieu thereof,  the Seller shall give written  notice
thereof  to the  Purchaser  promptly  after  Seller  learns or  receives  notice
thereof.  Upon a taking of a  material  part of the  Property  greater  than TWO
HUNDRED THOUSAND  ($200,000) DOLLARS or any part of the building or more than 5%
of the parking area, Purchaser may elect to either (a) terminate this Agreement,
in which event the deposit  shall be  immediately  returned to Purchaser and all
other  rights  and   obligations  of  the  parties   hereunder  shall  terminate
immediately,  or (b) waive its right to terminate  this Agreement and proceed to
closing,  in which event all proceeds,  awards and other payments arising out of
such  condemnation or sale (actual or threatened) shall be paid to the Purchaser
at Closing,  if such payment has been  received.  If payment has not as yet been
received,  but an amount has been agreed upon,  Seller shall assign the claim to
Purchaser.

                  10.3  RISK OF LOSS.  Prior to  closing,  all  risks of loss or
damage by every casualty shall be borne by the Seller.

                                   ARTICLE XI
                                     BROKER

                  11.1 BROKER.  Seller and  Purchaser  represent  and warrant to
each other that no broker  brought about this  transaction  and,  therefore,  no
brokerage fees are or shall be owing in connection with this transaction. Seller
and  Purchaser  agree to hold each other  harmless in  connection  with any such
brokerage fees.

                                       11
<PAGE>

                                   ARTICLE XII
                                     DEFAULT

                  12.1  DEFAULT  DEFINED.   Default  for  the  purpose  of  this
Agreement  shall  mean any  deliberate  or  intentional  failure  by  Seller  or
Purchaser to fulfill all the terms,  conditions and covenants  contained herein,
however,  it shall not be an event of default for either  party to exercise  its
rights to terminate this contract as contained in other provisions herein.

                  12.2 SELLER'S DEFAULT.  Upon Seller's default,  the Purchaser,
at it's election,  may either (1) require  specific  performance  of Seller,  or
pursue its other remedies at law or equity, (2) cancel this Agreement and obtain
a prompt return of the deposit, in which case this Agreement shall be terminated
and the parties  released from all obligations  hereunder,  or (3) the Purchaser
may waive such  defaults  and  proceed to  settlement.  Seller  shall  indemnify
Purchaser for any reasonable  costs incurred by Purchaser if Purchaser elects to
pursue its option (1) noted above, to include reasonable attorney fees.

                  12.3  PURCHASER'S  DEFAULT.  Upon  Purchaser's  default,  this
Agreement  shall be terminated  and both parties  released from all  obligations
hereunder,  and the  deposit  shall be  retained  by the  Seller  as  liquidated
damages.  Such  amount  and terms are  agreed  upon by and  between  Seller  and
Purchaser as liquidated  damages,  due to the  difficulty and  inconvenience  of
ascertaining and measuring actual damages,  and the uncertainty thereof, and the
payment of the deposit  and the terms  provided  herein  shall  constitute  full
satisfaction of Purchaser's  obligations  under this  Agreement.  Such amount is
agreed upon by and between Seller and Purchaser as a reasonable estimate of just
compensation  for the harm caused by Purchaser's  default.  Seller shall have no
other remedy against Purchaser in the event of Purchaser's default.

                                  ARTICLE XIII
                            MISCELLANEOUS PROVISIONS

                  13.1 ENTIRE  AGREEMENT.  This  Agreement sets forth the entire
understanding  between the parties;  it supersedes  all previous  agreements and
representations which are deemed merged herein and may not be modified except in
writing.

                  13.2 ASSIGNMENT.  Purchaser may assign all of its rights,  but
not its obligations  under this Agreement to a limited liability company without
the consent of Seller.

                  13.3 LIKE KIND  EXCHANGE.  Purchaser  has advised  Seller that
Purchaser  is  purchasing   the  Property  to  complete  a  like  kind  exchange
transaction under Section 1031 of the Internal Revenue Code of 1986, as amended.
Seller  agrees to  assist  Purchaser  in  effecting  such  like  kind  exchange;
provided,  however,  that all costs  incurred to effect such like kind  exchange
shall be borne solely by Purchaser. Seller has advised Purchaser that Seller may
desire to effect a like kind  exchange  transaction  under  Section  1031 of the
Internal  Revenue Code of 1986,  as

                                       12
<PAGE>

amended,  with  respect  to  some  or all of the  Property  being  purchased  by
Purchaser.  If Seller elects to effect a like kind exchange with respect to some
or all of the Property, Purchaser agrees to assist Seller in effecting such like
kind exchange;  provided,  however,  that all costs incurred to effect such like
kind exchange shall be borne solely by Seller.

                  13.4 SEVERABILITY. If any provision,  sentence, phrase or word
of this Agreement or the application thereof to any person or circumstance shall
be held invalid,  the  remainder of this  Agreement or the  application  of such
provision,  sentence,  phrase, or word to persons or  circumstances,  other than
those as to which it is held invalid, shall remain in full force and effect.

                  13.5 BINDING  EFFECT.  The parties to the  Agreement  mutually
agree that it shall be binding upon and inure to the benefit of their respective
heirs, representatives, successors in interest and assigns.

                  13.6  CONTROLLING  LAW. It is the intent of the parties hereto
that all questions  with respect to the  construction  of this Agreement and the
rights and liabilities of the parties shall be determined in accordance with the
provisions of the laws of the State set forth in Par. 1.1.

                  13.7 COUNTERPARTS. To facilitate execution, this Agreement may
be  executed  in as  many  counterparts  as may be  required.  It  shall  not be
necessary  that the  signature on behalf of both parties  hereto  appear in each
counterpart  hereof,  and it shall be sufficient that the signature on behalf of
both parties hereto appear on one or more such  counterparts.  All  counterparts
shall collectively constitute a single contract.

                  13.8 INCORPORATION BY REFERENCE.  All of the Exhibits referred
to herein  and/or  attached  hereto shall be deemed to  constitute a part of the
Agreement.

                  13.9  HEADINGS.  The  headings of the  Articles  and  sections
hereof are inserted for convenience only and shall not be deemed to constitute a
part of the Agreement.

                  13.10  CONSTRUCTION  OF  CONTRACT.   Each  party  hereto  have
reviewed and revised (or requested  revisions of) this Agreement,  and therefore
the normal rule of construction  that any ambiguities are to be resolved against
a  particular   party  shall  not  be   applicable  in  the   construction   and
interpretation of this Contract or any amendments or exhibits hereto.

                  13.11  EXHIBITS.  The following  exhibits are attached to this
Agreement and are incorporated  into this Agreement by this reference and made a
part hereof for all purposes:

                           EXHIBIT A, legal description of the land
                           EXHIBIT B, list of personal property
                           EXHIBIT C, purchase price allocation
                           EXHIBIT D, form of Deed

                                       13
<PAGE>

                           EXHIBIT E, (i) form of Bill of Sale, (ii) Assignments
                                      and Assumptions of Leases, etc.
                           EXHIBIT F, form of Representation Letter
                           EXHIBIT G, Permitted Exceptions
                           EXHIBIT H, Phase II Punch List Items

                                   ARTICLE XIV
                                     NOTICE

                  14.1  NOTICE.  All notices  required or  permitted to be given
under this  Agreement  shall be in writing and shall be sent or delivered to the
address set forth below (or such other address as may be hereafter  specified in
writing):

                    To Seller:       Mr. Jeffery W. Kentner
                                     State Street Companies, Inc.
                                     211 East Boulevard
                                     Charlotte, NC   28203
                                     Tel: (704) 372-3703
                                     Fax: (704) 372-3704

                    With a copy to
                      Seller's Attorneys:  C. Mark Wiley, Esq.
                                           Womble Carlyle Sandridge & Rice
                                           200 West Second Street
                                           Winston-Salem, NC   27101
                                           Tel: (336) 721-3605
                                           Fax: (336) 733-8406

                    To Purchaser:    Mr. Gus Remppies
                                     Cornerstone Realty Group, Inc.
                                     306 E. Main Street
                                     Richmond, VA  23219
                                     Tel: (804) 643-1761
                                     Fax: (804) 782-9302

                    With a copy to
                      Purchaser's Attorneys:  Harry S. Taubenfeld, Esq.
                                              Zuckerbrod & Taubenfeld
                                              575 Chestnut St., P.O. Box 488
                                              Cedarhurst, NY   11516
                                              Tel: (516) 374-3133
                                              Fax: (516) 374-3490
                                                          -and-

                                       14
<PAGE>

                                              Ted Oliver, Esq.
                                              Manning, Fulton & Skinner
                                              500 UCB Plaza
                                              3605 Glenwood Avenue
                                              Raleigh, NC   27612
                                              Tel: (919) 787-8880
                                              Fax: (919) 781-0811

                  13.2 DELIVERY OF NOTICE.  Notices sent either by Registered or
Certified Mail, Return Receipt Requested,  or by overnight express mail shall be
deemed  given  when  deposited  in the  United  States  Mail,  postage  prepaid,
delivered to a reliable overnight courier or by facsimile transmission.  Notices
sent in any other manner shall be deemed given only when  actually  delivered at
the specified address.

                    IN WITNESS WHEREOF, the Seller and the Purchaser have caused
this Agreement to be executed this day and date first written above.

SELLER:

GREYSTONE CROSSING APARTMENTS, LLC
By: STATE STREET COMPANIES, INC., Manager

By:  /s/  Jeffery W. Kentner
    -------------------------------------
       Jeffery W. Kentner
Its:   President
    -------------------------------------

GCA-II, LLC
By: STATE STREET COMPANIES, INC., Manager

By:  /s/  Jeffery W. Kentner
    -------------------------------------
       Jeffery W. Kentner
Its:   President
    -------------------------------------

PURCHASER:

CORNERSTONE REALTY GROUP, INC.

By:  /s/  Gus G. Remppies
    -------------------------------------
Its:   V. P.   4-20-00  GGR
    -------------------------------------

                                       15
<PAGE>

                     FIRST MODIFICATION TO PURCHASE CONTRACT

         This First Modification to Purchase Contract  ("Modification")  is made
and entered into this 9th day of May 2000 between CORNERSTONE REALTY GROUP, INC.
or  its  nominee   (hereinafter   called  "Purchaser")  and  GREYSTONE  CROSSING
APARTMENTS, LLC and GCA-II, LLC (hereinafter collectively called "SELLER").

         WHEREAS,  Purchaser and Seller entered into a Purchase  Contract on the
20th day of April 2000 ("AGREEMENT"); and

         WHEREAS,  Purchaser  and  Seller  now  desire to  modify  and amend the
Agreement as set forth herein.

         NOW,  THEREFORE,  in  consideration  of the premises and the respective
agreements hereinafter set forth, Seller and Purchaser agree as follows:

         1. All  terms  not  specifically  defined  herein  shall  have the same
meaning as ascribed to them in the Agreement unless previously modified.

         2.  ARTICLE  VIII,  Paragraph  8.1(C),  is  hereby  amended  to read as
follows:

                  "(C) Upon  compliance  with the above items (A) and (B),  then
         within seven (7) days after Escrow  Holder shall have been  notified in
         writing and  instructed  by both  parties to  terminate  the escrow and
         deliver the SIX MILLION  ($6,000,000)  DOLLARS to the Seller.  However,
         the escrow shall not be delivered for a minimum of sixty (60) days with
         an  automatic  extension  of  an  additional  sixty  (60)  days  unless
         Purchaser shall have previously  notified the Escrow Holder  otherwise.
         Notwithstanding  the foregoing,  however,  provided that Section 8.1(A)
         has been  satisfied  by Seller,  the escrow  shall be released no later
         than one hundred twenty (120) days after closing."

         3. Except as herein modified, the terms and provisions of the Agreement
shall remain in full force and effect.

         4. In the event there is any conflict in the terms of this Modification
and the terms of the Agreement, the terms of this Modification shall govern.

         5. This Modification may be executed in separate counterparts,  each of
which  shall  be  deemed  an  original  and all of  which  taken  together  will
constitute one agreement between the parties hereto.

                                       16
<PAGE>

         IN WITNESS WHEREOF,  the parties hereto have executed this Modification
on the date first above written.

                                    SELLER:

                                    GREYSTONE CROSSING APARTMENTS, LLC
                                    By:    STATE STREET COMPANIES, INC., Manager

                                    By:   /s/  Tiffany Gay
                                        ----------------------------------
                                    Its:    V. P.
                                        ----------------------------------

                                    GCA-II, LLC
                                    By:    STATE STREET COMPANIES, INC., Manager

                                    By:   /s/  Tiffany Gay
                                        ----------------------------------
                                    Its:    V. P.
                                        ----------------------------------

                                    PURCHASER:

                                    CORNERSTONE REALTY GROUP, INC.

                                    By:   /s/  Gus G. Remppies
                                        ----------------------------------
                                    Its:     V. P.
                                        ----------------------------------

                                       17EXHIBIT 10.44

                       AMENDED AND RESTATED LOAN AGREEMENT

                               DATED MAY 17, 2000,

                        BY AND AMONG KARTS INTERNATIONAL

                    INCORPORATED AND THE SCHLINGER FOUNDATION

<PAGE>

                       AMENDED AND RESTATED LOAN AGREEMENT

THIS AMENDED AND RESTATED LOAN  AGREEMENT (the  "Agreement")  is made as of this
17th day of May, 2000 by and between KARTS INTERNATIONAL INCORPORATED,  a Nevada
corporation  ("Borrower")  and  THE  SCHLINGER  FOUNDATION   ("Schlinger").   In
connection  with the mutual  covenants  and  agreements  contained  herein,  the
parties hereto agree as follows:

1.       Definitions. All terms and phrases used herein which are defined in the
         Uniform  Commercial Code in the State of Texas, as amended from time to
         time (the "UCC"),  shall have the meanings given them in the UCC unless
         otherwise  defined  herein.  The  following   definitions  shall  apply
         throughout this Agreement:

         "Affiliate"  means with  respect to any Person in  question,  any other
         Person  owned or  controlled  by, or which owns or controls or is under
         common control or is otherwise affiliated with such Person in question.
         A Person  shall be  deemed to  control  another  Person if such  Person
         possesses,  directly  or  indirectly,  the power to direct or cause the
         direction of the management and policies of such other Person,  whether
         through the ownership of voting securities, by contract or otherwise.

         "BTK" means Brister's Thunder Karts, Inc., a Louisiana corporation.

         "Business Day" means any day other than  Saturday,  Sunday or any other
         day on which financial institutions doing business in Dallas, Texas are
         closed.

         "Collateral" has the meaning given it in Section 4.

         "Common  Stock" shall mean the common  stock,  $.001 par value,  of the
         Borrower.

         "Environmental  Laws" means any and all federal,  state and local laws,
         regulations,  rules, orders, licenses, agreements or other governmental
         restrictions  relating  to  the  protection  of  human  health  or  the
         environment  or to  emissions,  discharges or releases of pollutants or
         industrial,  toxic or hazardous  substances  into the  environment,  or
         otherwise relating to the manufacture, processing, treatment, transport
         or handling of pollutants or industrial, toxic or hazardous substances.

         "ERISA" means the Employee  Retirement  Income Security Act of 1974, as
         amended  from time to time,  together  with all  rules and  regulations
         promulgated with respect thereto.

         "ERISA  Affiliate"  means with respect to any Person in  question,  any
         Person that would be treated as a single, employer with Borrower.

                                       2

<PAGE>

         "ERISA  Plan" means any  pension  benefit  plan  subject to Title IV of
         ERISA  maintained  by  Borrower  or any ERISA  Affiliate  thereof  with
         respect  to  which  Borrower  or any  ERISA  Affiliate  has a fixed  or
         contingent liability.

         "Event of Default" has the meaning given it in Section 12.

         "GAAP"  means  those  generally  accepted  accounting   principles  and
         practices  which are  recognized  as such by the  Financial  Accounting
         Standards Board (or any generally recognized  successor),  consistently
         applied throughout the period involved.

         "Guarantors"  means USA,  BTK,  KINT and Straight  Line (whether one or
         more).

         "Indemnified Claims" means any and all claims, demands, actions, causes
         of action, judgments, suits, liabilities,  obligations, losses, damages
         and consequential damages,  penalties, fines, costs, fees, expenses and
         disbursements  (including  without  limitation,  fees and  expenses  of
         attorneys and other professional  consultants and experts in connection
         with any  investigation  or defense) of every kind or nature,  known or
         unknown,  existing or hereafter arising,  foreseeable or unforeseeable,
         which may be imposed upon,  threatened or asserted  against or incurred
         or paid by any  Indemnified  Person  at any time and from time to time,
         because of or resulting from, in connection with or in any way relating
         to or arising out of the Loan, the Collateral or any other transaction,
         act,  omission,  event or  circumstance  in any way  connected  with or
         contemplated  by this  Agreement  or the other  Loan  Documents  or any
         action  taken or omitted  by any such  Indemnified  Person  under or in
         connection with any of the foregoing  (including but not limited to any
         investigation,   litigation,  proceeding,  enforcement  of  Schlinger's
         rights or defense of Schlinger's  actions  related to or arising out of
         this  Agreement  or the  other  Loan  Documents),  whether  or not  any
         Indemnified Person is a party hereto.

         "Indemnified   Person"  shall   collectively  mean  Schlinger  and  its
         officers,    directors,     shareholders,     employees,     attorneys,
         representatives, agents, Affiliates, successors and assigns.

         "KINT" means KINT, L.L.C., a Louisiana limited liability company.

         "Lien" means any mortgage,  lien,  pledge,  assignment,  adverse claim,
         charge, security interest or other encumbrance.

         "Loan" has the meaning given it in Section 2.

         "Loan  Documents"  means  this  Agreement,   the  Note  and  all  other
         documents,  agreements  and  instruments  now or hereafter  required by
         Schlinger  to  be  executed  and  delivered  in   connection   herewith
         (including,   without   limitation,   all  documents,   agreements  and
         instruments  evidencing,   securing,  governing,   guaranteeing  and/or
         pertaining to the Note and the Loan).

                                       3

<PAGE>

         "Maximum   Rate"  means,   with  respect  to  Schlinger,   the  maximum
         non-usurious  interest rate, if any, that any time or from time to time
         may be  contracted  for,  taken,  reserved,  charged or  received  with
         respect  to the Loan or other  amount  as to which  such  rate is to be
         determined,  payable to  Schlinger  pursuant to this  Agreement  or any
         other Loan  Document,  under laws  applicable  to  Schlinger  which are
         presently  in effect  or, to the  extent  allowed  by law,  under  such
         applicable  laws which may  hereafter  be in effect  and which  allow a
         higher  maximum  non-usurious  interest rate than  applicable  laws now
         allow. The Maximum Rate shall be calculated in a manner that takes into
         account any and all fees,  payments and other charges in respect of the
         Loan Documents that  constitute  interest  under  applicable  law. Each
         change in any interest  rate provided for herein based upon the Maximum
         Rate  resulting  from a change in the  Maximum  Rate shall take  effect
         without  notice  to the  Borrower  at the  time of such  change  in the
         Maximum Rate. For purposes of determining  the Maximum Rate under Texas
         law,  the  applicable  rate ceiling  shall be (a) the "weekly  ceiling"
         described in and computed in accordance  with the provisions of Section
         303.003 of the Texas  Finance  Code,  as amended or (b) if the  parties
         subsequently contract as allowed by Texas law, the quarterly ceiling or
         the  annualized  ceiling  computed  pursuant to Section  303.008 of the
         Texas Finance Code, as amended; provided, however, that at any time the
         "weekly ceiling", the quarterly ceiling or the annualized ceiling shall
         be less than 18% per annum or more than 24% per annum,  the  provisions
         of Section 303.009(a) and Section 303.009(b) of the Texas Finance Code,
         as amended,  shall  control  for  purposes  of such  determination,  as
         applicable.

         "Net  Profit"  means net income  after taxes  (including  extraordinary
         losses and excluding  extraordinary gains) as of the end of time period
         being measured.

         "Note" has the meaning given it in Section 3.

         "Obligations"   means  any  and  all   indebtedness,   liabilities  and
         obligations of Borrower or any other Obligor to Schlinger, evidenced by
         and/or  arising  pursuant  to  any of the  Loan  Documents  (including,
         without  limitation,  this  Agreement  and the Note),  now  existing or
         hereafter arising, whether direct, indirect, related, unrelated, fixed,
         contingent,  liquidated,  unliquidated,  joint,  several  or joint  and
         several,  including,  without  limitation,  (a) the  obligations of the
         Borrower or any other Obligor to repay the Loan, to pay interest on the
         Loan (including,  without  limitation,  interest accruing after any, if
         any,  bankruptcy,  insolvency,  reorganization or other similar filing)
         and to  pay  all  fees,  indemnities,  costs  and  expenses  (including
         attorneys'  fees)  provided  for in the  Loan  Documents  and  (b)  the
         indebtedness   constituting   the  Loan  and   such   interest,   fees,
         indemnities, costs and expenses.

         "Obligors" means Borrower and Guarantors.

         "Original Loan Agreement"  means that certain Loan Agreement dated June
         3, 1999 between Schlinger and Borrower, as amended.

         "Original  Loan"  means  the  "Loan"  as such  term is  defined  in the
         Original Loan Agreement.

                                       4

<PAGE>

         "Original Loan  Documents"  means the "Loan  Documents" as such term is
         defined in the Original Loan Agreement.

         "Permitted Liens" means the Liens disclosed on Schedule 1 hereto.

         "Person"  means  a  corporation,   association,   partnership,  limited
         liability company, organization,  business, individual, governmental or
         political subdivision thereof or governmental agency.

         "Subordinated  Debt" means indebtedness owing by Borrower to a creditor
         other than Schlinger which has been  subordinated  and subject in right
         of payment to the prior payment of all indebtedness and obligations now
         or hereafter owing by Borrower to Schlinger,  such  subordination to be
         evidenced by a written agreement between Schlinger and the subordinated
         creditor which is in form and substance satisfactory to Schlinger.

         "Subsidiary"  means,  with respect to any Person,  any  corporation  or
         other entity of which at least a majority of the outstanding  shares of
         stock or other ownership interests having by the terms thereof ordinary
         voting power to elect a majority of the board of directors  (or Persons
         performing   similar   functions)   of  such   corporation   or  entity
         (irrespective  of  whether  or not  at  the  time,  in  the  case  of a
         corporation,  stock of any other  class or classes of such  corporation
         shall have or might have voting power by reason of the happening of any
         contingency) is at the time directly or indirectly  owned or controlled
         by such Person or one or more of its Subsidiaries or by such Person and
         one or more of its Subsidiaries.

         "Straight Line" means  Straight  Line  Manufacturing, Inc.,  a Michigan
         corporation.

         "Tangible  Net  Worth"  means,  as of any  date,  the  amount  by which
         Borrower's total assets exceeds its total liabilities plus Subordinated
         Debt,  less any intangible  assets (as defined by GAAP),  less deferred
         charges.

         "Termination  Event" means (a) the occurrence with respect to any ERISA
         Plan of (i) a  reportable  event  described in Sections  4043(b)(5)  of
         ERISA or (ii) any other  reportable  event described in Section 4043 of
         ERISA other than a reportable  event not subject to the  provision  for
         30-day notice to the Pension Benefit Guaranty Corporation pursuant to a
         waiver by such  corporation  under  Section  4043(a) of ERISA,  (b) the
         withdrawal of Borrower or any Affiliate of Borrower from any ERISA Plan
         during a plan year in which it was a "substantial  employer" as defined
         in Section  4001(a)(2)  of ERISA,  or (c) any event or condition  which
         might   constitute   grounds  under  Section  4042  of  ERISA  for  the
         termination  of, or the  appointment  of a trustee to  administer,  any
         ERISA Plan.

         "USA" means USA Industries Incorporated, an Alabama corporation.

2.       Loan.

                                       5

<PAGE>

         (a) Loan and Repayment.  Subject to the terms of this Agreement, on the
         date of this Agreement or at such time that all  applicable  conditions
         have been satisfied,  whichever is later, Schlinger will make a loan in
         one or more  advances  to the  Borrower  (the  "Loan"),  to the  extent
         requested  by the  Borrower as of such date,  in an original  principal
         amount not to exceed  Two  Million  Five  Hundred  Thousand  and No/100
         Dollars ($2,500,000) in the aggregate.  Notwithstanding anything to the
         contrary contained in this Agreement,  the Borrower and Schlinger agree
         that, as of the date hereof, the aggregate outstanding principal amount
         of the  Original  Loan is  $1,500,000,  which  amount  shall be  deemed
         outstanding as part of the Loan  hereunder.  (Such loans referred to in
         this Section 2 (a) now or hereafter made or deemed made by Schlinger to
         Borrower are hereinafter  collectively called the "Loan".) Principal of
         the Loan  shall be due and  payable  in one  installment  of all unpaid
         principal and accrued unpaid interest on May 17, 2005.

         (b) Prepayment.  Borrower may prepay the Loan in full or in part at any
         time prior to May 17,  2005,  provided,  that the  Borrower  shall give
         Schlinger ten (10) days' written notice of the Borrower's  intention to
         do so.

3.       Promissory Note.

         (a)      Note. Borrower agrees to execute,  contemporaneously herewith,
                  a promissory  note payable to the order of Schlinger,  in form
                  and substance  acceptable to Schlinger in Schlinger's sole and
                  absolute  discretion,  for  the  Loan  provided  hereunder  to
                  evidence the indebtedness owing by Borrower to Schlinger under
                  the Loan  (whether one or more,  together  with any  renewals,
                  extensions and increases thereof, the "Note").

         (b)      Rate and  Payments.  The principal of and interest on the Note
                  shall be due and payable and may be prepaid in accordance with
                  the  terms  and  conditions  set forth in the Note and in this
                  Agreement.  Interest on the Note shall  accrue at the rate set
                  forth therein.

4.       Collateral.  As security for the Obligations, Schlinger shall receive a
         Lien in and to the  collateral  described  in the other Loan  Documents
         (the "Collateral").

5.       Guarantors.  As a  condition  precedent  to  Schlinger's  obligation to
         provide the Loan to Borrower,  Borrower  agrees to cause the Guarantors
         to each execute and deliver to Schlinger  contemporaneously  herewith a
         guaranty  agreement,  in form and substance  acceptable to Schlinger in
         Schlinger's sole and absolute discretion.

6.       Representations and Warranties. Borrower hereby represents and warrants
         to Schlinger as follows:

         (a)      Existence.  Borrower is a corporation duly organized,  validly
                  existing and in good  standing  under the laws of the state of
                  its  incorporation  and  is  duly  licensed,  qualified  to do
                  business and is in good  standing in all other states in which
                  such licensing, qualification and good standing are necessary.

                                       6

<PAGE>

                  Borrower has all requisite  power and authority (i) to own and
                  operate its  properties,  (ii) to carry on its business as now
                  conducted  and as  proposed  to be  conducted,  and  (iii)  to
                  execute  and  deliver  this   Agreement  and  the  other  Loan
                  Documents to which Borrower is a party.

         (b)      Binding Obligations. The execution,  delivery, and performance
                  of this  Agreement  and all of the  other  Loan  Documents  by
                  Borrower have been duly authorized by all necessary  action by
                  Borrower,  have been duly  executed and  delivered by Borrower
                  and  constitute  legal,  valid  and  binding   obligations  of
                  Borrower,  enforceable  in  accordance  with their  respective
                  terms, except as limited by bankruptcy,  insolvency or similar
                  laws of general  application  relating to the  enforcement  of
                  creditors'  rights and except to the extent specific  remedies
                  may generally be limited by equitable principles.

         (c)      No Consent.  The execution,  delivery and  performance of this
                  Agreement and the other Loan Documents,  and the  consummation
                  of the transactions  contemplated  hereby and thereby,  do not
                  (i) conflict  with,  result in a violation of, or constitute a
                  default  under (A) any  provision  of  Borrower's  articles or
                  certificate  of   incorporation   or  bylaws,   (B)  any  law,
                  governmental  regulation,  court decree or order applicable to
                  Borrower,  or (C) any other  document  or  agreement  to which
                  Borrower is a party, or (ii) require the consent,  approval or
                  authorization of any third party.

         (d)      Financial  Condition.  Each  financial  statement  of Borrower
                  supplied to  Schlinger  is true,  correct and  complete in all
                  material  respects and fairly  presents  Borrower's  financial
                  condition in all material respects as of the date of each such
                  statement.  There has been no material  adverse change in such
                  financial  condition  or results  of  operations  of  Borrower
                  subsequent to the date of the most recent financial  statement
                  supplied to Schlinger.

         (e)      Litigation.  There  are  no  actions,  suits  or  proceedings,
                  pending or, to the knowledge of Borrower,  threatened  against
                  or affecting  Borrower or the  properties of Borrower,  before
                  any court or  governmental  department,  commission  or board,
                  which,  if  determined  adversely  to  Borrower,  would have a
                  material adverse effect on the business,  financial condition,
                  properties, operations or prospects of Borrower.

         (f)      Taxes.  Governmental Charges.  Borrower has filed all federal,
                  state and local tax reports and returns required by any law or
                  regulation  to be filed  by it and has  either  duly  paid all
                  taxes,  duties and charges  indicated due on the basis of such
                  returns  and  reports,  or  made  adequate  provision  for the
                  payment thereof,  and the assessment of any material amount of
                  additional  taxes in excess of those paid and  reported is not
                  reasonably  expected.  There  is no tax  Lien  notice  against
                  Borrower or its properties presently on file.

         (g)      ERISA  Compliance.   Borrower  is  in  compliance  with  ERISA
                  concerning  Borrower's  ERISA Plan, if any, or is not required
                  to  contribute  to any  "multi-employer  plan" as  defined  in
                  Section 401 of ERISA.

                                       7

<PAGE>

         (h)      Compliance  with Laws.  Borrower is conducting its business in
                  material  compliance  with all  statutes,  rules,  regulations
                  and/or  ordinances  imposed  by  any  governmental  unit  upon
                  Borrower  or upon  its  businesses,  operations  and  property
                  (including,   without  limitation,  all  Environmental  Laws).
                  Borrower  has  all  permits  and  licenses  necessary  for the
                  operations  of its  business  as  presently  conducted  and as
                  proposed to be conducted.

         (i)      Tradenames.  Borrower and Guarantors conduct business under no
                  trade or assumed name except KINT conducts  business under the
                  tradename Bird Promotions.

7.       Conditions  Precedent  to  Loan.  Schlinger's  obligation  to make  the
         Loan under this Agreement and the other Loan Documents shall be subject
         to the conditions precedent that, as of the date of such Loan and after
         giving effect thereto (i) all  representations  and warranties  made to
         Schlinger in this Agreement and the other Loan Documents  shall be true
         and  correct,  as of and as if  made  on such  date,  (ii) no  material
         adverse  change in the financial  condition of Borrower or its business
         since  the  effective  date of the  most  recent  financial  statements
         furnished to Schlinger by Borrower shall have occurred,  (iii) no Event
         of  Default  shall  have  occurred  and no event  has  occurred  and is
         continuing,  or would result from the requested Loan, which with notice
         or lapse of time,  or both,  would  constitute  an Event of Default (as
         hereinafter  defined),  (iv)  Schlinger  shall have  received  all Loan
         Documents  appropriately  executed  by  Borrower  and all other  proper
         parties and all such Loan  Documents are in full force and effect,  (v)
         all  indebtedness,  liabilities and obligations of each of the Obligors
         to KBK  Financial,  Inc.  shall be paid in full  concurrently  with the
         making of the Loan,  (vi) Schlinger  shall have received all documents,
         certificates,  agreements and  instruments  relating to the issuance of
         preferred shares of capital stock of Borrower to Schlinger, in form and
         substance satisfactory to Schlinger, appropriately executed by Borrower
         and all other proper  parties,  and (vii) Schlinger shall have received
         all fees and expenses  owing to Schlinger  under this Agreement and the
         other  Loan  Documents  (including,   without  limitation,  legal  fees
         incurred in connection  with the Original Loan  Agreement and the other
         Original  Loan  Documents   which  are   reimbursable  by  Borrower  to
         Schlinger).

8.       Affirmative  Covenants.  Until the Note and all other  obligations  and
         liabilities  of  Borrower  under  this  Agreement  and the  other  Loan
         Documents  are  fully  paid and  satisfied,  and  Borrower  agrees  and
         covenants that it will,  unless  Schlinger shall  otherwise  consent in
         writing (which consent may be withheld by Schlinger in Schlinger's sole
         and absolute discretion):

         (a)      Accounts  and  Records.  Maintain  its  books and  records  in
                  accordance with GAAP.

         (b)      Right of Inspection.  Permit Schlinger to visit its properties
                  and installations and to examine, audit and make and take away
                  copies or reproductions  of Borrower's  books and records,  at
                  all  reasonable  times.  Borrower  agrees  to  pay  all  costs
                  associated  with any such  audits,  at a rate equal to $500.00
                  per day, per person,  plus out-of-pocket  expenses;  provided,
                  however,  as  long  as  no  Event  of  Default  has  occurred,

                                       8

<PAGE>

                  Borrower's  obligation for Schlinger's audits shall not exceed
                  $15,000.00 per calendar year.

         (c)      Right to Additional  Information.  Furnish Schlinger with such
                  additional  information  and  statements,  lists of assets and
                  liabilities,  tax returns,  and other  reports with respect to
                  Borrower's  financial  condition  and business  operations  as
                  Schlinger may request from time to time.

         (d)      Compliance  with Laws.  Conduct its business in an orderly and
                  efficient manner consistent with good business practices,  and
                  perform  and  comply  with all  statutes,  rules,  regulations
                  and/or  ordinances  imposed  by  any  governmental  unit  upon
                  Borrower, its businesses, operations and properties (including
                  without limitation, all Environmental Laws).

         (e)      Taxes.  Pay and  discharge  when due all  assessments,  taxes,
                  governmental  charges  and  levies,  of every kind and nature,
                  imposed upon  Borrower or its  properties,  income or profits,
                  prior to the date on which  penalties  would  attach,  and all
                  lawful claims that, if unpaid, might become a Lien upon any of
                  Borrower's  property,  income or profits;  provided,  however,
                  Borrower  will not be required to pay and  discharge  any such
                  assessment,  tax,  charge,  levy or  claim so long as (i) same
                  shall be  contested  in good  faith by  appropriate  judicial,
                  administrative or other legal proceedings  timely  instituted,
                  (ii) Borrower shall have  established  adequate  reserves with
                  respect to such contested  assessment,  tax,  charge,  levy or
                  claim in accordance  with GAAP,  and (iii) the  perfection and
                  priority of Schlinger's  security  interest in the Collateral,
                  or the value of the Collateral, is not impaired.

         (f)      Insurance.  Maintain,  with  financially  sound and  reputable
                  insurers,  such  insurance  as deemed  necessary  or otherwise
                  reasonably  required by  Schlinger,  including but not limited
                  to, fire  insurance,  comprehensive  property  damage,  public
                  liability,  worker's  compensation  and business  interruption
                  insurance.

         (g)      Notice of Material Change/Litigation.  Borrower shall promptly
                  notify Schlinger in writing (i) of any material adverse change
                  in Borrower's financial condition or its businesses,  and (ii)
                  of any  litigation  or claims  against  Borrower  which  could
                  materially   affect  Borrower  or  its  business   operations,
                  financial condition or prospects.

         (h)      Corporate Existence. Maintain its corporate existence and good
                  standing   in  the   state  of  its   incorporation   and  its
                  qualification  and good  standing  in all other  states  where
                  required by applicable law.

         (i)      ERISA.  Borrower shall promptly notify Schlinger in writing of
                  the  adoption  or  amendment  of any plan that  results in the
                  representations  in  Subsection  7(g) no longer being true and
                  correct.

                                       9

<PAGE>

         (j)      Employment  Agreement.  On or before  June 17,  2000,  Charles
                  Brister and Richard N. Jones shall have each  entered  into an
                  employment  agreement  with  Borrower that is for a term of at
                  least three (3) years and is otherwise  in form and  substance
                  satisfactory to Schlinger.

         (k)      Additional Documentation.  Execute and deliver, or cause to be
                  executed  and  delivered,   any  and  all  other   agreements,
                  instruments  or  documents   which  Schlinger  may  reasonably
                  request   in  order  to  give   effect  to  the   transactions
                  contemplated   under  this   Agreement   and  the  other  Loan
                  Documents.

9.       Negative  Covenants.  Until  the Note  and all  other  obligations  and
         liabilities  of  Borrower  under  this  Agreement  and the  other  Loan
         Documents  are fully  paid and  satisfied,  Borrower  will not and will
         cause Guarantors to not, without the prior written consent of Schlinger
         (which consent, withhold in Schlinger's sole and absolute discretion):

         (a)      Nature of Business.  Make any material change in the nature of
                  its business as carried on as of
                  the date hereof.

         (b)      Liquidations,  Mergers,  Consolidations;   Acquisitions;  Name
                  Change. Liquidate, merge or consolidate with or into any other
                  Person,  convert from one type of legal entity to another type
                  of legal entity, form or acquire any new subsidiary or acquire
                  by  purchase  or  otherwise  all or  substantially  all of the
                  assets of any other  Person,  or  change  its name or  operate
                  under any new trade or assumed names.

         (c)      Transactions  with  Affiliates.  Enter  into any  transaction,
                  including,  without limitation, the purchase, sale or exchange
                  of  property  or  the  rendering  of  any  service,  with  any
                  Affiliate of any Obligor, except in the ordinary course of and
                  pursuant  to  the  reasonable  requirements  of  an  Obligor's
                  business,  upon fair and reasonable terms no less favorable to
                  Obligor  than would be obtained in a  comparable  arm's-length
                  transaction  with a person or entity not an  Affiliate  of any
                  Obligor and in accordance with the terms and provisions of the
                  Loan Documents.

         (d)      Sale of Assets. Sell, lease,  transfer or otherwise dispose of
                  all or  substantially  all of its assets or properties,  other
                  than inventory sold in the ordinary  course of business and as
                  necessary to replace obsolete equipment.

         (e)      Liens.  Create or incur any Lien on any of its  assets,  other
                  than (i) Liens securing indebtedness owing to Schlinger,  (ii)
                  pledges or deposits to secure the payment of obligations under
                  any worker's compensation laws or similar laws, (iii) deposits
                  to secure the payment of public or statutory obligations, (iv)
                  mechanic's,  carriers', workman's,  repairman's or other Liens
                  arising by operation of law in the ordinary course of business
                  which  secure  obligations  that are not  overdue or are being
                  contested  in  good  faith  and  for  which  such  entity  has
                  established  adequate  reserves in accordance  with  generally
                  accepted  accounting  principles,  (and for which  Schlinger's

                                       10

<PAGE>

                  security  interest in the  Collateral is not impaired) and (v)
                  Liens existing as of the date hereof which have been disclosed
                  to and approved by Schlinger in writing.

         (f)      Change in Management. Permit a change in the senior management
                  of Borrower.

         (g)      Loans.  Make any loans to any person or entity.

10.      Financial  Covenants.  Until the Note  and  all other  obligations  and
         liabilities  of  Borrower  under  this  Agreement  and the  other  Loan
         Documents are fully paid and  satisfied,  Obligors,  on a  consolidated
         basis, will maintain the following financial covenants:

         (a)      Current Ratio. At the end of each fiscal month, a ratio of (i)
                  current assets (excluding prepaid  expenses),  to (ii) current
                  liabilities of not less than 1.5 to 1.0.

         (b)      Debt/Tangible  Net  Worth  Ratio.  At the end of  each  fiscal
                  month,  a ratio of total  liabilities to Tangible Net Worth of
                  less than 2.5 to 1.0.

         (c)      Tangible  Net  Worth.  At the end of each  fiscal  month,  its
                  Tangible Net Worth of not less than $2,500,000.00.

         Unless  otherwise  specified,  all accounting  and financial  terms and
         covenants set forth above are to be determined according to GAAP.

11.      Reporting  Requirements.  Until the Note and all other  obligations and
         liabilities  of  Borrower  under  this  Agreement  and the  other  Loan
         Documents  are fully paid and  satisfied,  Borrower will and will cause
         the Guarantors to, unless Schlinger shall otherwise consent in writing,
         furnish to Schlinger:

         (a)      Financial Statements.  The following financial statements: (i)
                  within  120 days  after  the last day of each  fiscal  year of
                  Borrower a consolidated statement of income and a consolidated
                  statement of cash flows of Obligors for such fiscal year,  and
                  a consolidated balance sheet of Obligors as of the last day of
                  such  fiscal  year  in each  case  audited  by an  independent
                  certified  public  accounting  firm  acceptable  to Schlinger,
                  together with a copy of any report to management  delivered to
                  Borrower by such accountants in connection therewith; and (ii)
                  within  30 days  after  the last day of each  fiscal  month of
                  Borrower,  an unaudited  consolidated  statement of income and
                  statement of cash flows of Obligors for such fiscal month, and
                  an unaudited  consolidated balance sheet of Obligors as of the
                  last  day  of  such  fiscal  month.  Borrower  represents  and
                  warrants  that each such  statement of income and statement of
                  cash flows will fairly  represent,  in all material  respects,
                  the results of  operations  and cash flows of Borrower for the
                  period set forth  therein,  and that each such  balance  sheet
                  will fairly represent, in all material respects, the financial
                  condition of Borrower as of the date set forth therein, all in
                  accordance with GAAP, (or, with respect to unaudited financial
                  statements,  in the notes  thereto  and  subject  to  year-end
                  review adjustments).

                                       11

<PAGE>

         (b)      Inventory  Listing.  A list  of  inventory  for USA and BTK by
                  location and type (to include the  following:  raw  materials,
                  work in process and finished  goods)  within ten (10) Business
                  Days  after  the  end  of  each  month,  in  form  and  detail
                  satisfactory to Schlinger.

12.      Events of Default.  Each of the  following  shall  constitute an "Event
         of Default" under this Agreement and the other Loan Documents:

         (a)      Failure to Pay Indebtedness. Borrower shall fail to pay as and
                  when due any part of the  principal  of, or  interest  on, the
                  Note  or any  other  Obligations  now or  hereafter  owing  to
                  Schlinger by Borrower.

         (b)      Non-Performance of Covenants. Any of the Obligors shall breach
                  any covenant or agreement made herein in any of the other Loan
                  Documents or in any other  agreement now or hereafter  entered
                  into between any of the Obligors and Schlinger.

         (c)      False  Representation.  Any  warranty or  representation  made
                  herein,  or in any of the other Loan Documents  shall be false
                  or misleading in any material respect when made.

         (d)      Default Under Other Loan Documents. The occurrence of an event
                  of default under any of the other Loan  Documents or any other
                  agreement  now or  hereafter  entered  into between any of the
                  Obligors and Schlinger.

         (e)      Untrue Financial Report.  Any report,  certificate,  schedule,
                  financial  statement,  profit  and  loss  statement  or  other
                  statement  furnished by any Obligor, or by any other person on
                  behalf of any Obligor, to Schlinger is not true and correct in
                  any material respect.

         (f)      Default to Third  Party.  The  occurrence  of any event  which
                  permits the  acceleration of the maturity of any  indebtedness
                  owing by any of the  Obligors  to any  third  party  under any
                  agreement or undertaking.

         (g)      Bankruptcy.  The filing of a voluntary or involuntary  case by
                  or  against  any of  the  Obligors  under  the  United  States
                  Bankruptcy  Code or other  present or future  federal or state
                  insolvency,  bankruptcy or similar laws, or the appointment of
                  a  receiver,   trustee,   conservator   or  custodian   for  a
                  substantial portion of the assets of any of the Obligors.

         (h)      Insolvency. Any of the Obligors shall become insolvent, make a
                  transfer in fraud of creditors or make an  assignment  for the
                  benefit of creditors.

         (i)      Involuntary   Lien.   The  filing  or   commencement   of  any
                  involuntary Lien, garnishment, attachment or the like shall be
                  issued against or with respect to the Collateral.

                                       12

<PAGE>

         (j)      Material  Adverse Change. A material adverse change shall have
                  occurred in the  financial  condition,  business  prospects or
                  operations of any of the Obligors.

         (k)      Tax Lien.  Any of the  Obligors  shall have a federal or state
                  tax Lien filed against any of its properties.

         (l)      Execution on Collateral. The Collateral or any portion thereof
                  is taken on execution or other process of law.

         (m)      ERISA Plan.  Either (i) any "accumulated  funding  deficiency"
                  (as defined in Section 412(a) of the Internal  Revenue Code of
                  1986, as amended) in excess of $25,000  exists with respect to
                  any ERISA Plan of Borrower or its ERISA Affiliate, or (ii) any
                  Termination  Event  occurs  with  respect to any ERISA Plan of
                  Borrower or its ERISA  Affiliate and the then current value of
                  such ERISA Plan's benefit liabilities exceeds the then current
                  value of such ERISA Plan's assets available for the payment of
                  such benefit liabilities by more than $25,000.

         (n)      Guarantor's  Obligations.  If any of  the  obligations  of any
                  Guarantor is limited or  terminated  by operation of law or by
                  such Guarantor,  or any such Guarantor  becomes the subject of
                  an insolvency proceeding.

         (o)      Judgment. The entry against any of the Obligors of a final and
                  nonappealable  judgment  for the payment of money in excess of
                  $25,000 (not covered by insurance satisfactory to Schlinger in
                  Schlinger's sole discretion).

         Nothing  contained in this Loan  Agreement  shall be construed to limit
         the events of default enumerated in any of the other Loan Documents and
         all such events of default shall be cumulative.

13.      Remedies.  Upon  the  occurrence  of any one or  more of the  foregoing
         Events of Default,  the entire unpaid balance of principal of the Note,
         together with all accrued but unpaid  interest  thereon,  and all other
         indebtedness  owing to Schlinger by Borrower at such time shall, at the
         option of Schlinger, become immediately due and payable without further
         notice, demand,  presentation,  notice of dishonor, notice of intent to
         accelerate, notice of acceleration, protest or notice of protest of any
         kind, all of which are expressly waived by Borrower; provided, however,
         concurrently  and  automatically  with  the  occurrence  of an Event of
         Default under  Subsections  12 (g) or 12 (h) of this Agreement the Note
         and all other  indebtedness owing to Schlinger by Borrower at such time
         shall,  without any action by  Schlinger,  become  immediately  due and
         payable,  without  further  notice,  demand,  presentation,  notice  of
         dishonor,  notice of  acceleration,  notice  of  intent to  accelerate,
         protest or notice of protest  of any kind,  all of which are  expressly
         waived by Borrower.  All rights and remedies of Schlinger  set forth in
         this  Agreement and in any of the other Loan  Documents are  cumulative
         and may also be exercised by  Schlinger,  at its option and in its sole
         discretion, upon the occurrence of an Event of Default.

                                       13

<PAGE>

14.      Indemnification.   Borrower  hereby  indemnifies  and  agrees  to  hold
         harmless  and defend all  Indemnified  Persons from and against any and
         all  Indemnified  Claims.  THE  FOREGOING  INDEMNIFICATION  SHALL APPLY
         WHETHER OR NOT SUCH INDEMNIFIED  CLAIMS ARE IN ANY WAY OR TO ANY EXTENT
         OWED,  IN  WHOLE OR IN PART,  UNDER  ANY  CLAIM  OR  THEORY  OF  STRICT
         LIABILITY,  OR ARE CAUSED, IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR
         OMISSION  OF ANY  INDEMNIFIED  PERSON,  but  shall  exclude  any of the
         foregoing resulting from such Indemnified  Person's gross negligence or
         willful  misconduct.  If Borrower  or any third party ever  alleges any
         gross negligence or willful  misconduct by any Indemnified  Person, the
         indemnification  provided for in this Section shall nonetheless be paid
         upon demand,  subject to later adjustment or reimbursement,  until such
         time as a court of competent jurisdiction enters a final judgment as to
         the  extent  and  affect of the  alleged  gross  negligence  or willful
         misconduct.  Upon  notification and demand,  Borrower agrees to provide
         defense of any  Indemnified  Claim and to pay all costs and expenses of
         counsel  selected by any  Indemnified  Person in respect  thereof.  Any
         Indemnified  Person against whom any Indemnified  Claim may be asserted
         reserves the right to settle or compromise any such  Indemnified  Claim
         as such Indemnified  Person may determine in its sole  discretion,  and
         the obligations of such  Indemnified  Person,  if any,  pursuant to any
         such  settlement  or  compromise  shall be deemed  included  within the
         Indemnified  Claims.  Except as specifically  provided in this Section,
         Borrower waives all notices from any Indemnified Person. The provisions
         of this Section shall survive the termination of this Agreement.

15.      Rights  Cumulative.  All  rights of  Schlinger  under the terms of this
         Agreement  shall be  cumulative  of, and in addition  to, the rights of
         Schlinger  under  any and all other  agreements  between  Borrower  and
         Schlinger  (including,  but not limited to, the other Loan  Documents),
         and not in  substitution  or  diminution of any rights now or hereafter
         held by Schlinger under the terms of any other agreement.

16.      Waiver and Agreement.  Neither the failure nor any delay on the part of
         Schlinger to exercise any right, power or privilege herein or under any
         of the other Loan  Documents  shall  operate as a waiver  thereof,  nor
         shall any single or partial exercise of such right,  power or privilege
         preclude any other or further  exercise  thereof or the exercise of any
         other right,  power or  privilege.  No waiver of any  provision in this
         Loan  Agreement or in any of the other Loan  Documents and no departure
         by Borrower  therefrom  shall be effective  unless the same shall be in
         writing and signed by  Schlinger,  and then shall be effective  only in
         the specific instance as specified in such writing.  No modification or
         amendment to this Loan  Agreement or to any of the other Loan Documents
         shall be valid or  effective  unless  the same is  signed  by the party
         against whom it is sought to be enforced.

17.      Benefits. This Agreement shall be binding upon and inure to the benefit
         of Schlinger and Borrower, and their respective successors and assigns;
         provided,  however,  that  Borrower may not,  without the prior written
         consent of Schlinger,  assign any rights, powers, duties or obligations
         under this Agreement or any of the other Loan Documents.

                                       14

<PAGE>

18.      Notices.  All  notices,   requests,  demands  or  other  communications
         required or permitted to be given pursuant to this  Agreement  shall be
         in writing and given by (i) personal delivery,  (ii) expedited delivery
         service with proof of  delivery,  (iii)  United  States  mail,  postage
         prepaid,  registered or certified mail,  return receipt  requested,  or
         (iv) telecopy (with receipt  thereof  confirmed by telecopier)  sent to
         the intended  addressee at the address set forth on the signature  page
         hereof and shall be deemed to have been received either, in the case of
         personal delivery,  as of the time of personal delivery, in the case of
         expedited delivery service,  as of the date of first attempted delivery
         at the address and in the manner provided herein,  in the case of mail,
         upon deposit in a depository  receptacle  under the care and custody of
         the United  States  Postal  Service,  or in the case of telecopy,  upon
         receipt.  Either  party  shall have the right to change its address for
         notice  hereunder to any other location within the  continental  United
         States by notice to the other party of such new address at least thirty
         (30) days prior to the effective date of such new address.

19.      Governing Law; Venue;  Submission to  Jurisdiction.  THIS AGREEMENT AND
         THE  OTHER  LOAN  DOCUMENTS  SHALL  BE  GOVERNED  BY AND  CONSTRUED  IN
         ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT GIVING EFFECT TO
         THE  PRINCIPLES  OF  CONFLICTS  OF LAWS  THEREOF,  EXCEPT TO THE EXTENT
         PERFECTION  AND THE  EFFECT  OF  PERFECTION  OR  NON-PERFECTION  OF THE
         SECURITY  INTEREST GRANTED  HEREUNDER OR THEREUNDER,  IN RESPECT OF ANY
         PARTICULAR COLLATERAL, ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
         THAN THE STATE OF TEXAS.  THIS  AGREEMENT AND THE OTHER LOAN  DOCUMENTS
         ARE  PERFORMABLE BY THE PARTIES IN DALLAS COUNTY,  TEXAS.  BORROWER AND
         SCHLINGER EACH AGREE THAT DALLAS COUNTY,  TEXAS, SHALL BE THE EXCLUSIVE
         VENUE FOR  LITIGATION OF ANY DISPUTE OR CLAIM ARISING UNDER OR RELATING
         TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AND THAT SUCH COUNTY IS
         A  CONVENIENT  FORUM IN WHICH TO  DECIDE  ANY SUCH  DISPUTE  OR  CLAIM.
         BORROWER AND SCHLINGER EACH CONSENT TO THE PERSONAL JURISDICTION OF THE
         STATE  AND  FEDERAL  COURTS  LOCATED  IN DALLAS  COUNTY,  TEXAS FOR THE
         LITIGATION OF ANY SUCH DISPUTE OR CLAIM.  BORROWER  IRREVOCABLY WAIVES,
         TO THE FULLEST EXTENT  PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW
         OR  HEREAFTER  HAVE TO THE  LAYING OF THE VENUE OF ANY SUCH  PROCEEDING
         BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING  BROUGHT
         IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

20.      Waiver of Jury Trial.  BORROWER AND SCHLINGER  EACH HEREBY  IRREVOCABLY
         WAIVES,  TO THE MAXIMUM EXTENT  PERMITTED BY LAW, ANY RIGHT IT MAY HAVE
         TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION  DIRECTLY OR INDIRECTLY
         AT ANY TIME ARISING OUT OF, UNDER OR IN CONNECTION  WITH THIS AGREEMENT
         OR ANY TRANSACTION CONTEMPLATED HEREBY OR ASSOCIATED HEREWITH.

                                       15

<PAGE>

21.      Invalid  Provisions.  If any provision of this  Agreement or any of the
         other Loan  Documents is held to be illegal,  invalid or  unenforceable
         under present or future laws,  such provision  shall be fully severable
         and the remaining provisions of this Agreement or any of the other Loan
         Documents  shall  remain  in full  force  and  effect  and shall not be
         affected by the illegal,  invalid or unenforceable  provision or by its
         severance.

22.      Expenses. Borrower shall pay all costs and expenses (including, without
         limitation,  reasonable  attorneys'  fees) in  connection  with (i) the
         preparation  of the Loan  Documents,  (ii) any action  required  in the
         course of administration of the indebtedness and obligations  evidenced
         by the Loan  Documents,  and (iii) any  action  in the  enforcement  of
         Schlinger's rights upon the occurrence of Event of Default.

23.      Participation  of the Loan.  Provided  that the  prospective  purchaser
         and/or assignee is not a business competitor of Borrower, as determined
         by  Schlinger  in  its  reasonable  discretion,  Borrower  agrees  that
         Schlinger may, at its option, sell interests in the Loan and its rights
         under this  Agreement and the other Loan  Documents  and, in connection
         with each such sale,  Schlinger  may disclose any  financial  and other
         information   available  to  Schlinger   concerning  Borrower  to  each
         prospective purchaser and assignee.

24.      Maximum Interest Rate.

         (a)      No interest rate specified in this Agreement or any other Loan
                  Document  shall at any time exceed the Maximum Rate. If at any
                  time the interest rate (the  "Contract  Rate") for the Loan or
                  any other  indebtedness,  liability or obligation shall exceed
                  the  Maximum  Rate,  thereby  causing  the  interest  accruing
                  thereon to be limited to the Maximum Rate, then any subsequent
                  reduction in the Contract Rate  therefor  shall not reduce the
                  rate of interest  therefor  below the  Maximum  Rate until the
                  aggregate  amount  of  interest  accrued  thereon  equals  the
                  aggregate  amount of interest which would have accrued thereon
                  if the Contract Rate had at all times been in effect.

         (b)      Notwithstanding  anything to the  contrary  contained  in this
                  Agreement or the other Loan  Documents,  none of the terms and
                  provisions of this Agreement or the other Loan Documents shall
                  ever be  construed to create a contract or  obligation  to pay
                  interest  at a  rate  in  excess  of  the  Maximum  Rate;  and
                  Schlinger shall never charge, receive, take, collect,  reserve
                  or apply,  as interest on the Loan or any other  indebtedness,
                  liability or  obligation,  any amount in excess of the Maximum
                  Rate. The parties hereto agree that any interest, charge, fee,
                  expense or other obligation  provided for in this Agreement or
                  in the other Loan Documents which  constitutes  interest under
                  applicable  law  shall  be,  ipso  facto and under any and all
                  circumstances,  limited or  reduced to an amount  equal to the
                  lesser  of (i) the  amount  of  such  interest,  charge,  fee,
                  expense  or other  obligation  that  would be  payable  in the
                  absence of this  Section  24(b) or (ii) an amount,  which when
                  added to all other  interest  payable under this Agreement and
                  the  other  Loan  Documents,  equals  the  Maximum  Rate.  If,
                  notwithstanding  the foregoing,  Schlinger ever contracts for,
                  charges,  receives,  takes,  collects,  reserves or applies as
                  interest any amount in excess of the Maximum Rate, such amount
                  which  would be deemed  excessive  interest  shall be deemed a

                                       16

<PAGE>

                  partial  payment or prepayment of principal of the Loan or any
                  other  indebtedness,   liability  or  obligation  and  treated
                  hereunder as such; and if the Loan or any other  indebtedness,
                  liability or obligation,  or applicable portions thereof,  are
                  paid in full,  any remaining  excess shall promptly be paid to
                  the  Borrower  or other  applicable  Obligor or  Obligors  (as
                  appropriate).  In  determining  whether the  interest  paid or
                  payable,  under any specific contingency,  exceeds the Maximum
                  Rate, the Borrower and the other Obligors and Schlinger shall,
                  to  the  maximum  extent  permitted  by  applicable  law,  (a)
                  characterize  any nonprincipal  payment as an expense,  fee or
                  premium  rather  than  as  interest,   (b)  exclude  voluntary
                  prepayments  and  the  effects  thereof,   and  (c)  amortize,
                  prorate,  allocate  and spread in equal or  unequal  parts the
                  total amount of interest  throughout  the entire  contemplated
                  term  of the  Loan or any  other  indebtedness,  liability  or
                  obligation,  or  applicable  portions  thereof,  so  that  the
                  interest  rate does not  exceed the  Maximum  Rate at any time
                  during  the  term  of  the  Loan  or any  other  indebtedness,
                  liability  or   obligation;   provided  that,  if  the  unpaid
                  principal  balance is paid and  performed in full prior to the
                  end of the full contemplated term thereof, and if the interest
                  received for the actual  period of existence  thereof  exceeds
                  the Maximum  Rate,  Schlinger  shall refund to the Borrower or
                  other  applicable  Obligor or Obligors  (as  appropriate)  the
                  amount of such excess and, in such event,  Schlinger shall not
                  be  subject  to  any  penalties   provided  by  any  laws  for
                  contracting  for,  charging,  receiving,  taking,  collecting,
                  reserving or applying interest in excess of the Maximum Rate.

25.      Conflicts.  In the event any term or provision  hereof is  inconsistent
         with or  conflicts  with  any  term  or  provision  in any of the  Loan
         Documents,  the terms and provisions  contained in this Agreement shall
         be controlling.

26.      Counterparts.  This Agreement may be separately  executed in any number
         of counterparts,  each of which shall be an original, but all of which,
         taken  together,  shall  be  deemed  to  constitute  one and  the  same
         instrument.  Delivery of an executed  counterpart  of this Agreement by
         telecopy  shall be  equally  as  effective  as  delivery  of a manually
         executed  counterpart  of  this  Agreement.  Any  party  delivering  an
         executed counterpart of this Agreement by telecopy also shall deliver a
         manually  executed  counterpart  of this  Agreement  but the failure to
         deliver a manually executed  counterpart shall not affect the validity,
         enforceability, and binding effect of this Agreement.

27.      Amendment and Restatement of the Original Loan Agreement.  Effective as
         of the date hereof,  this Agreement  shall  constitute an amendment and
         restatement of all, but not an extinguishment,  discharge, satisfaction
         or novation of any,  indebtedness  liabilities  and/or  obligations  of
         Borrower under the Original Loan Agreement.

28.      ENTIRE AGREEMENT. THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS
         REPRESENT THE FINAL  AGREEMENT  BETWEEN THE PARTIES HERETO WITH RESPECT
         TO THE TRANSACTIONS  CONTEMPLATED HEREIN AND MAY NOT BE CONTRADICTED BY
         EVIDENCE OF PRIOR,  CONTEMPORANEOUS,  OR SUBSEQUENT  ORAL AGREEMENTS OF

                                       17

<PAGE>

         THE  PARTIES.  THERE  ARE NO  UNWRITTEN  ORAL  AGREEMENTS  BETWEEN  THE
         PARTIES.  THIS AGREEMENT ALSO AMENDS AND SUPERSEDES ANY OF THE TERMS OF
         ANY PRIOR WRITTEN  AGREEMENTS  WITH RESPECT TO THE MATTERS SET FORTH IN
         THIS AGREEMENT.

EXECUTED as of the date first above written.

BORROWER:                                          SCHLINGER:
KARTS INTERNATIONAL INCORPORATED                   THE SCHLINGER FOUNDATION
By:   /s/ Charles Brister                          By: /s/ Evert I. Schlinger
      -------------------------                        -----------------------
Name:     Charles Brister                          Name:   Evert I. Schlinger
Title:    President and                            Title:  President
          Chief Executive Officer

Borrower's Address:                                Schlinger's Address:
P. O. Box 695                                      The Schlinger Foundation
62204 Commercial Street                            1944 Edison Street
Roseland, Louisiana 70456                          Santa Yinez, California 93460
Telecopy No.:  504-747-2700                        Telecopy No.: (805) 686-1618

                                       18

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00010-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00010-of-00352.parquet"}]]