Document:

Prepared by MerrillDirect

CREDIT
AGREEMENT

             THIS
AGREEMENT is entered into as of May 30, 2001 by and between NORTHWEST
PIPE COMPANY, an Oregon
Corporation ("Borrower"), and WELLS FARGO BANK, NATIONAL ASSOCIATION ("Bank").

RECITALS

             Borrower
has requested that Bank extend or continue credit to Borrower as described
below, and Bank has agreed to provide such credit to Borrower on the terms and
conditions contained herein.

             NOW,
THEREFORE, for valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Bank and Borrower hereby agree as follows:

ARTICLE
I

CREDIT TERMS

             SECTION
1.1.                LINE OF CREDIT.

             (a)         Line of Credit. Subject to the
terms and conditions of this Agreement, Bank hereby agrees to make advances to
Borrower from time to time up to and including June 30, 2003 not to exceed at
any time the aggregate principal amount of
Thirty Million Dollars ($30,000,000.00) ("Line of Credit"),
the proceeds of which shall be used for working capital and general corporate
purposes. Borrower's obligation to repay advances under the Line of Credit
shall be evidenced by a promissory note substantially in the form of Exhibit
"A" attached hereto ("Line of Credit Note"), all
terms of which are incorporated herein by this reference.

             (b)        Letter of Credit Subfeature. As a
subfeature under the Line of Credit, Bank agrees from time to time during the
term thereof to issue or cause an affiliate to issue Standby letters of credit
for the account of Borrower to finance borrower's self insurance for worker's
compensation (each, a "Letter of Credit" and collectively,
"Letters of Credit "); provided however, that the aggregate
undrawn amount of all outstanding Letters of Credit shall not at any time
exceed One Million Five Hundred Thousand Dollars ($1,500,000.00). No Letter of
Credit shall have an expiration date subsequent to the maturity date of the
Line of Credit. The undrawn amount of all Letters of Credit shall be reserved
under the Line of Credit and
shall not be available for borrowings thereunder. Each Letter of Credit shall
be subject to the additional terms and conditions of the Letter of Credit
agreements, applications and any related documents required by Bank in
connection with the issuance thereof. Each draft paid under a Letter of Credit
shall be deemed an advance under the Line of Credit and shall be repaid by
Borrower in accordance with the terms and conditions of this Agreement
applicable to such advances; provided however, that if advances under the Line
of Credit are not available, for any reason, at the time any draft is paid,
then Borrower shall immediately pay to Bank the full amount of such draft,
together with interest thereon from the date such draft is paid to the date
such amount is fully repaid by Borrower, at the Prime Rate-based rate of
interest applicable to advances under the Line of Credit. In such event
Borrower agrees that Bank, in its sole discretion, may debit any account
maintained by Borrower with Bank for the amount of any such draft.

             (c)         Borrowing and Repayment.
Borrower may from time to time during the term of the Line of Credit borrow,
partially or wholly repay its outstanding borrowings, and reborrow, subject to
all of the limitations, terms and conditions contained herein or in the Line of
Credit Note; provided however, that the total outstanding borrowings under the
Line of Credit shall not at any time exceed the maximum principal amount
available thereunder, as set forth above.

             SECTION
1.2.                INTEREST/FEES.

             (a)         Interest. The outstanding
principal balance of the Line of Credit shall bear interest at the rate(s) of
interest set forth in the Line of Credit Note.

             (b)        Computation and Payment. Interest
shall be computed on the basis of a 360-day year, actual days elapsed. Interest
shall be payable at the times and place set forth in the Line of Credit Note.

             (c)         Commitment Fee. Borrower shall
pay to Bank a non-refundable commitment fee for the Line of Credit equal to Ten
Thousand Dollars, which fee shall be due and payable in full on the date of
Borrower's execution of this Agreement.

             (d)        Unused Commitment Fee. Borrower
shall pay to Bank a fee equal to one-fifth percent (0.20%) per annum (computed
on the basis of a 360-day year, actual days elapsed) on the average daily
unused amount of the Line of Credit, which fee shall be calculated on a monthly
basis by Bank and shall be due and payable by Borrower in arrears within five
(5) days after each billing is sent by Bank.

             (e)         Letter of Credit Fees. Borrower
shall pay to Bank fees (i) upon the issuance of each Letter of Credit equal to
one and three quarters percent (1.75%) per annum (computed on the basis of a
360-day year, actual days elapsed) of the face amount thereof, and (ii) upon
the payment or negotiation of each
draft under any Letter of Credit and upon the occurrence of any other
activity with respect to any Letter of Credit (including without limitation,
the transfer, amendment or cancellation of any Letter of Credit) determined in
accordance with Bank's standard fees and charges then in effect for such
activity.

             SECTION
1.3.                COLLECTION OF PAYMENTS.
Borrower authorizes Bank to collect all interest and fees due under each credit
subject hereto by charging Borrower's deposit account number 4496887373 with
Bank, or any other deposit account maintained by Borrower with Bank, for the
full amount thereof. Should there be insufficient funds in any such deposit
account to pay all such sums when due, the full amount of such deficiency shall
be immediately due and payable by Borrower.

             SECTION
1.4.                GUARANTIES. All
indebtedness of Borrower to shall be guaranteed jointly and severally by
Southwestern Pipe, Inc.; North American Pipe, Inc.; and P & H Tube
Corporation (collectively, together with any other entity, incorporated under
the laws of any state or territory of the United States of America, hereafter
formed or acquired, which is required under generally accepted accounting
principles, consistently applied ("GAAP") to be included in
Borrower's consolidated financial statements, the "Domestic
Subsidiaries") in the principal amount of Thirty Million Dollars
($30,000,000.00) each, as evidenced by and subject to the terms of guaranties
in form and substance satisfactory to Bank. Southwestern Pipe, Inc.; North
American Pipe, Inc.; and P & H Tube Corporation, together with any other
hereafter formed or acquired entity constituted or incorporated under the laws
of any state or territory of the United
States of America, which is required under generally accepted accounting
principles, consistently applied ("GAAP") to be included in
Borrower's consolidated financial statements, are referred to hereinafter as,
individually, a "Domestic Subsidiary", and collectively as the
"Domestic Subsidiaries". Borrower shall cause each hereafter
acquired or formed Domestic Subsidiary to execute and deliver to Bank a
guaranty and resolution, in the same form as executed by the existing Domestic
Subsidiaries, contemporaneously with such acquisition or formation.

ARTICLE II

REPRESENTATIONS AND WARRANTIES

             Except as set forth on Schedule I attached to this
Agreement, Borrower makes the following representations and warranties to Bank,
which representations and warranties shall survive the execution of this
Agreement and shall continue in full force and effect until the full and final
payment, and satisfaction and discharge, of all obligations of Borrower to Bank
subject to this Agreement.

             SECTION 2.1.                LEGAL STATUS. Borrower is a Corporation, duly
organized and existing and in good standing under the laws of the State of
Oregon, and is qualified or licensed to do business (and is in good standing as
a foreign corporation, if applicable) in all jurisdictions in which such
qualification or licensing is required or in which the failure to so qualify or
to be so licensed could have a material adverse effect on the operations,
business or condition (including financial condition) of Borrower and
Subsidiaries, taken as a whole. with "Subsidiaries" defined as
all Domestic Subsidiaries, as defined in Section 1.4, together with Thompson
Tanks Mexico S.A. de C.V. and any other foreign entity(ies) required under GAAP
to be included in Borrower’s consolidated financial statements. Except as set
forth in the preceding sentence, as of the date hereof Borrower has no
subsidiaries which would be required under generally accepted accounting
principles to be consolidated with Borrower.

             SECTION 2.2.                AUTHORIZATION AND VALIDITY. This Agreement and each
promissory note, contract, instrument and other document required hereby or at
any time hereafter delivered to Bank in connection herewith (collectively, the
"Loan Documents") have been duly authorized, and upon their execution
and delivery in accordance with the provisions hereof will constitute legal,
valid and binding agreements and obligations of Borrower or the party which
executes the same, enforceable in accordance with their respective terms.

             SECTION 2.3.                NO VIOLATION. The execution, delivery and performance
by Borrower of each of the Loan Documents and by Domestic Subsidiaries of the
guaranties do not violate any provision of any law or regulation, or contravene
any provision of the Articles of Incorporation or By-Laws of Borrower or any
Domestic Subsidiary, or result in any breach of or default under any contract,
obligation, indenture or other instrument to which Borrower is a party or by
which Borrower or any Domestic Subsidiary may be bound.

             SECTION 2.4.                LITIGATION. There are no pending, or to the best of
Borrower’s knowledge threatened, actions, claims, investigations, suits or
proceedings by or before any governmental authority, arbitrator, court or
administrative agency which could have a material effect on Borrower or its
Subsidiaries, other than those disclosed by Borrower to Bank in writing prior
to the date hereof.

             SECTION 2.5.                CORRECTNESS OF FINANCIAL STATEMENT. The financial
statement of Borrower dated December 31, 2000 a true copy of which has been
delivered by Borrower to Bank prior
to the date hereof, (a) is complete and correct and presents fairly the
financial condition of Borrower, (b) discloses all liabilities of Borrower and
Subsidiaries that are required to be reflected or reserved against under
generally accepted accounting principles, whether liquidated or unliquidated,
fixed or contingent, and (c) has been prepared in accordance with GAAP. Since
the date of such financial statement there has been no material adverse change
in the financial condition of Borrower or any Subsidiary, nor has Borrower or
any Subsidiary mortgaged, pledged, granted a security interest in or otherwise
encumbered any of its assets or properties except in favor of Bank or as
otherwise permitted by Bank in writing.

             SECTION
2.6.                INCOME TAX RETURNS.
Borrower has no knowledge of any pending assessments or adjustments of its or
any Subsidiary's income tax payable with respect to any year.

             SECTION
2.7.                NO SUBORDINATION.
There is no agreement, indenture, contract or instrument to which Borrower or a
Domestic Subsidiary is a party or by which Borrower or a Domestic Subsidiary
may be bound that requires the subordination in right of payment of any of
Borrower's or a Domestic Subsidiary's obligations to Bank to any other
obligation of Borrower.

             SECTION
2.8.                PERMITS, FRANCHISES.
Borrower and each Subsidiary possesses, and will hereafter possess, all
permits, consents, approvals, franchises and licenses required and rights to
all trademarks, trade names, patents, and fictitious names, if any, necessary
to enable it to conduct the business in which it is now engaged in compliance
with applicable law.

             SECTION
2.9.                ERISA. To the best of
Borrower's knowledge, Borrower and each Domestic Subsidiary is in compliance in
all material respects with all applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended or recodified from time to time
("ERISA"); neither Borrower nor any Domestic Subsidiary has violated
any provision of any defined employee pension benefit plan (as defined in
ERISA) maintained or contributed to by Borrower (each, a "Plan"); no
Reportable Event as defined in ERISA has occurred and is continuing with
respect to any Plan initiated by Borrower or a Domestic Subsidiary; Borrower
and each Domestic Subsidiary has met its minimum funding requirements under
ERISA with respect to each Plan; and each Plan will be able to fulfill its
benefit obligations as they come due in accordance with the Plan documents and
under generally accepted accounting principles.

             SECTION
2.10.              OTHER OBLIGATIONS.
Neither Borrower nor any Subsidiary is in default on any obligation for
borrowed money, any purchase money obligation or any other material lease, commitment,
contract, instrument or obligation.

             SECTION
2.11.              ENVIRONMENTAL MATTERS.
Borrower and each Subsidiary is in compliance in all material respects with all
applicable federal or state environmental, hazardous waste, health and safety
statutes, and any rules or regulations adopted pursuant thereto, which govern
or affect any of Borrower's operations and/or properties, including without
limitation, with respect to Borrower and Domestic Subsidiaries, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
the Superfund Amendments and Reauthorization Act of 1986, the Federal Resource
Conservation and Recovery Act of 1976, and the Federal Toxic Substances Control
Act, as any of the same may be amended, modified or supplemented from time to
time. None of the operations of Borrower or any Subsidiary is the subject of
any federal or state investigation evaluating whether any remedial action
involving a material expenditure is needed to respond to a release of any toxic
or hazardous waste or substance into the environment. Neither Borrower nor any
Subsidiary has any material contingent liability in connection with any release
of any toxic or hazardous waste or substance into the environment.

ARTICLE III

CONDITIONS

             SECTION
3.1.                CONDITIONS OF INITIAL
EXTENSION OF CREDIT. The obligation of Bank to extend any credit contemplated
by this Agreement is subject to the fulfillment to Bank's satisfaction of all
of the following conditions:

             (a)
        Approval of Bank Counsel.
All legal matters incidental to the extension of credit by Bank shall be
satisfactory to Bank's counsel.

             (b)        Documentation. Bank shall have
received, in form and substance satisfactory to Bank, each of the following,
duly executed:

                           (i)          This Agreement and each promissory note
or other instrument required hereby.

                           (ii)         Addendum to Promissory Note.

                           (iii)        Guaranties.

                           (iv)       Certificates of Incumbency.

                           (v)        Borrowing and Guaranty Resolutions.

                           (vi)       Such other documents as Bank may require
under any other Section of this Agreement.

             (c)         Financial Condition. There shall
have been no material adverse change in the operations, business or condition
(including financial condition) of Borrower and Subsidiaries, taken as a
whole..

             (d)        Sale-Leaseback Financing.
Borrower shall have delivered to Bank evidence of Borrower having closed a
sale-leaseback transaction on terms reasonably satisfactory to Bank in an
amount not less than $40,000,000.00,

             SECTION
3.2.                CONDITIONS OF EACH
EXTENSION OF CREDIT. The obligation of Bank to make each extension of credit
requested by Borrower hereunder shall be subject to the fulfillment to Bank's
satisfaction of each of the following conditions:

             (a)
        Compliance. The
representations and warranties contained herein and in each of the other Loan
Documents shall be true on and as of the date of the signing of this Agreement
and on the date of each extension of credit by Bank pursuant hereto, with the
same effect as though such representations and warranties had been made on and
as of each such date, and on each such date, no Event of Default as defined
herein, and no condition, event or act which with the giving of notice or the
passage of time or both would constitute such an Event of Default, shall have
occurred and be continuing or shall exist.

             (b)        Documentation. Bank shall have
received all additional documents which may be required in connection with such
extension of credit.

ARTICLE IV

AFFIRMATIVE COVENANTS

             Borrower
covenants that so long as Bank remains committed to extend credit to Borrower
pursuant hereto, or any liabilities (whether direct or contingent, liquidated
or unliquidated) of Borrower to Bank
under any of the Loan Documents remain outstanding, and until payment in full
of all obligations of Borrower subject hereto, Borrower shall, and shall cause
each Subsidiary to, unless Bank otherwise consents in writing:

             SECTION 4.1.                PUNCTUAL PAYMENTS. Punctually pay all principal,
interest, fees or other liabilities due under any of the Loan Documents at the
times and place and in the manner specified therein.

             SECTION 4.2.                ACCOUNTING RECORDS. Maintain adequate books and
records in accordance with generally accepted accounting principles
consistently applied, and permit any representative of Bank, at any reasonable
time, to inspect, audit and examine such books, and records, to make copies of the same, and to inspect the real
and personal property of Borrower
or any Subsidiary.

             SECTION 4.3.                FINANCIAL STATEMENTS. Provide to Bank all of the
following, in form and detail satisfactory to Bank:

             (a)         As soon as available, and in any event within 105 days after
the end of each fiscal year of Borrower, the Annual Report and 10-K report of
Borrower. Unless already included within the annual report and 10-K report,
Borrower will deliver to Bank, as soon as available, and in any event within
105 days after the end of each fiscal year of Borrower, the consolidated
balance sheet of Borrower and its Subsidiaries as of the end of such fiscal
year and the related consolidated statements of income and retained earnings
and statement of changes in financial position of Borrower and its Subsidiaries
for such fiscal year, accompanied by the audit report thereon by independent
certified public accountants selected by Borrower and reasonably acceptable to
Bank (which reports shall be prepared in accordance with GAAP and shall not be
qualified by reason of qualified or restricted examination of any material
portion of the records of Borrower or any Subsidiary and shall contain no
disclaimer of opinion or adverse opinion except such as Bank in its sole
discretion determines to be immaterial);

             (b)       
As soon as available, and in any event within 105 days after the end of each
fiscal year of Borrower, a copy of the unaudited division and product line
consolidating income statements of Borrower and Subsidiaries as of the end of
such fiscal year.

             (c)         As
soon as available, and in any event within 60 days after the end of each fiscal
quarter of Borrower, except for fiscal year end, the 10-Q report of Borrower.
Unless already included within the 10-Q report, Borrower will deliver to Bank,
as soon as available, and in any event within 60 days after the end of each
such fiscal quarter, the unaudited consolidated balance sheet of Borrower and
its Subsidiaries as of the end of such fiscal quarter. At the same time,
Borrower shall deliver to Bank the division and product line consolidating
income statements of Borrower and Subsidiaries as of the end of such fiscal
quarter;

             (d)       
contemporaneously with each annual and quarterly financial statement of
Borrower required hereby, a certificate of chief financial officer of Borrower
that said financial statements are accurate and that there exists no Event of
Default nor any condition, act or event which with the giving of notice or the
passage of time or both would constitute an Event of Default, together with
calculations demonstrating compliance with financial covenants;

             (e)         not
later than 30 days after and as of the end of each month, an asset coverage
report;

             (f)         from time to time such other
information as Bank may reasonably request.

             SECTION
4.4.                COMPLIANCE. Preserve
and maintain all licenses, permits, governmental approvals, rights, privileges
and franchises necessary for the conduct of its business; and comply with the
provisions of all documents pursuant to which Borrower and each Subsidiary is
organized and/or which govern Borrower's or such Subsidiary's continued
existence and with the requirements of all laws, rules, regulations and orders
of any governmental authority applicable to Borrower, Subsidiaries and their
business.

             SECTION
4.5.                INSURANCE. Maintain
and keep in force insurance of the types and in amounts customarily carried in
lines of business similar to that of Borrower and its Subsidiaries, including
but not limited to fire, extended coverage, public liability, flood, property
damage and workers' compensation, with all such insurance carried with
companies and in amounts satisfactory to Bank, and deliver to Bank from time to
time at Bank's request schedules setting forth all insurance then in effect.

             SECTION
4.6.                FACILITIES. Keep all
properties useful or necessary to Borrower's and each Subsidiary's business in
good repair and condition, and from time to time make necessary repairs,
renewals and replacements thereto so that such properties shall be fully and
efficiently preserved and maintained.

             SECTION
4.7.                TAXES AND OTHER
LIABILITIES. Pay and discharge when due any and all indebtedness, obligations,
assessments and taxes, both real or personal, including without limitation
federal and state income taxes and state and local property taxes and
assessments, except such (a) as Borrower or any Subsidiary may in good faith
contest or as to which a bona fide dispute may arise, and (b) for which
Borrower or such Subsidiary has made provision, to Bank's satisfaction, for
eventual payment thereof in the event Borrower is obligated to make such
payment.

             SECTION
4.8.                LITIGATION. Promptly
give notice in writing to Bank of any litigation pending or threatened against
Borrower or any Subsidiary in excess of $500,000.00 to the extent not covered
by insurance.

             SECTION
4.9.                FINANCIAL CONDITION.
Maintain Borrower's consolidated financial condition as follows in accordance
with GAAP (except to the extent modified by the definitions herein):

             (a)         Tangible
Net Worth, determined as of each fiscal quarter end, not less than an aggregate
of (i) $85,000,000.00, plus (ii) 75% of cumulative consolidated net income for
all fiscal quarters ending after December 31, 2000, in which such net income was
greater than zero, and (iii) the amount by which the consolidated shareholders
equity has increased or shall increase after December 31, 2000 solely as a
result of the issuance of common or preferred stock or the conversion of debt
securities into such stock, with "Tangible Net Worth" defined
as the aggregate of total stockholders' equity plus subordinated debt less any
intangible assets.

             (b)        EBITDA
Coverage Ratio not less than 1.75 to 1.0, determined as of each fiscal quarter
end on a trailing four (4) fiscal quarter basis, with "EBITDA"
defined as net profit before tax plus interest expense (net of capitalized
interest expense), depreciation expense and amortization expense, and with
"EBITDA Coverage Ratio" defined as EBITDA divided by the
aggregate of total interest expense plus the prior period current maturity of
long-term debt, the prior period current maturity of capital leases and the
prior period current maturity of subordinated debt.

             (c)         Ratio
of Funded Debt to EBITDA, determined as of each fiscal quarter end, not greater
than 2.75 to 1.00 to and including September 30, 2002, and 2.50 to 1.00
thereafter, with "Funded Debt" defined as the aggregate of all
interest bearing obligations, inclusive of (without duplication) letters of credit, capital leases and
guaranteed indebtedness, and with "EBITDA" as defined above.

             (d)        Ratio
of unsecured Funded Debt to Asset Coverage, determined as of the end of each
month, not greater than 1.00 to 1.00, with "Funded Debt" as defined
above, and with "Asset Coverage" defined as the aggregate of
(i) seventy-five percent (75%) of Borrower's and Domestic Subsidiaries'
accounts receivable aged to 60 days past due or less, plus (ii) fifty percent
(50%) of the book value of Borrower's and Domestic Subsidiaries' inventory
under contract, and without duplication, of raw materials and finished goods,
plus (iii) 50% of the net book value of Borrower's and Domestic Subsidiaries'
unencumbered real estate located in the United States, plus (iv) 50% of the net
book value of Borrower's and Domestic Subsidiaries' unencumbered machinery and
equipment located in the United States.

             SECTION
4.10.              NOTICE TO BANK.  Promptly (but in no event more than five (5)
days after the occurrence of each such event or matter) give written notice to
Bank in reasonable detail of: (a) the occurrence of any Event of Default, or
any condition, event or act which with the giving of notice or the passage of
time or both would constitute an Event of Default; (b) any change in the name
or the organizational structure of Borrower or any Subsidiary; (c) the
occurrence and nature of any Reportable Event or Prohibited Transaction, each
as defined in ERISA, or any funding deficiency with respect to any Plan; or (d)
any termination or cancellation of any insurance policy which Borrower or any
Subsidiary is required to maintain, or any uninsured or partially uninsured
loss through liability or property damage, or through fire, theft or any other
cause affecting Borrower’s property.

ARTICLE V

NEGATIVE COVENANTS

             Borrower
further covenants that so long as Bank remains committed to extend credit to
Borrower pursuant hereto, or any liabilities (whether direct or contingent,
liquidated or unliquidated) of Borrower to Bank under any of the Loan Documents
remain outstanding, and until payment in full of all obligations of Borrower
subject hereto, Borrower will not, and will not cause or permit any Subsidiary
to, without Bank's prior written consent:

             SECTION
5.1.                USE OF FUNDS. Use any
of the proceeds of any credit extended hereunder except for the purposes stated
in Article I hereof.

             SECTION
5.2.                OTHER INDEBTEDNESS.
Create, incur, assume or permit to exist any indebtedness or liabilities
resulting from borrowings, capital leases, loans or advances, whether secured
or unsecured, matured or unmatured, liquidated or unliquidated, joint or
several, except (a) the liabilities of Borrower to Bank, (b) any other
liabilities of Borrower existing as of, and disclosed to Bank prior to, the
date hereof, and (c) additional purchase money indebtedness, not to exceed an
aggregate principal amount of $3,500,000.00 per calendar year, provided that
such indebtedness shall be fully secured by equipment and/or real estate. For
purposes of clause (c), the amount of indebtedness under capital leases shall
be determined in accordance with GAAP. Operating leases are excluded from the
scope of this Section.

             SECTION
5.5.                MERGER, CONSOLIDATION,
TRANSFER OF ASSETS. Merge into or consolidate with any other entity in except
(i) to the extent permitted in Section 5.8 hereof, and (ii) merger of any
Subsidiary into Borrower or into another Subsidiary; make any substantial
change in the nature of Borrowers or any Subsidiary's business as conducted as
of the date hereof; acquire all or substantially all of the assets of any other entity except to the
extent permitted in Section 5.8 below; nor sell, lease, transfer or otherwise
dispose of all or a substantial or material portion of Borrower's assets except
in the ordinary course of its business.

             SECTION
5.6.                GUARANTIES. Guarantee
or become liable in any way as surety, endorser (other than as endorser of
negotiable instruments for deposit or collection in the ordinary course of
business), accommodation endorser or otherwise for, nor pledge or hypothecate
any assets of Borrower as security for, any liabilities or obligations of any
other person or entity, except any of the
foregoing in favor of Bank.

             SECTION
5.7.                LOANS, ADVANCES,
INVESTMENTS. Make any loans or advances to or investments in any person or entity,
except (i) any of the foregoing existing as of, and disclosed to Bank prior to,
the date hereof, (ii) without duplication of any advances included in clause
(i), advances for travel and other expenses in the ordinary course of business
in an aggregate outstanding amount of $500,000.00, and (iii) investments to the
extent permitted in Section 5.8 below.

             SECTION
5.8.                PERMITTED
ACQUISITIONS. Acquire any business (whether by merger, acquisition of all or
substantially all of the assets of any other entity, investment, or otherwise)
without Bank's prior review and consent if the total of all such acquisitions
in any fiscal year exceeds 10% of Tangible Net Worth as of the end ofthe prior fiscal year.  For purposes of the 10% limitation above,
acquisitions shall be valued at the fair market value of all consideration
given, including without limitation, cash, notes, assumption of debt and stock.
All acquisitions otherwise permitted hereunder shall be approved by the board
of directors of the entity owning the business to be acquired or otherwise not
considered "hostile" by Bank.

             SECTION
5.9.                PLEDGE OF ASSETS.
Mortgage, pledge, grant or permit to exist a security interest or lien
(collectively, "Lien") in or upon, all or any portion of Borrower's
assets now owned or hereafter acquired, except:

             (a)         Liens
in favor of Bank;

             (b)        Liens
which are existing as of, and disclosed to Bank in writing prior to, the date
hereof;

             (c)         Liens
securing indebtedness permitted under Section 5.2(c);

             (d)        Liens
for taxes which are not delinquent or which remain payable without penalty or
the validity or amount of which are being contested in good faith by
appropriate proceedings by stay of execution of enforcement thereof;

             (e)         Liens
imposed by law (such as mechanics' liens) incurred in good faith in the
ordinary course of business which are not delinquent or which remain payable
without penalty or the validity or amount of which are being contested in good
faith by appropriate proceedings by stay of execution of enforcement thereof,
with, in the case of liens on property of Borrower or any Subsidiary under this
clause (e) or clause (d), provision having been made, to the satisfaction of
Bank, for the payment thereof in the event the contest is determined adversely
to either Borrower or such Subsidiary; and

             (d) deposits or pledges under
worker's compensation.

ARTICLE
VI

EVENTS OF DEFAULT

             SECTION
6.1.                The occurrence of any of the following  shall constitute an "Event
of Default" under this Agreement:

             (a)         Borrower shall fail to pay any
principal when due, or any interest, fees or other amounts payable under any of
the Loan Documents within 5 calendar days from the applicable due date.

             (b)        Any financial statement or certificate
furnished to Bank in connection with, or any representation or warranty made by
Borrower or any other party under this Agreement or any other Loan Document
shall prove to be incorrect, false or misleading when furnished or made and
which could reasonably be anticipated to have a material adverse effect on the
operations, business or condition (including financial condition) of Borrower
and Subsidiaries, taken as a whole.

             (c)         Any default in the performance of or
compliance with any obligation, agreement or other provision contained herein
or in any other Loan Document (other than those referred to in subsections (a)
and (b) above), and with respect to any such default (other than a breach of
Section 4.9 or of any Section of Article V), such default shall continue for a
period of thirty (30) days the date Borrower first knew (or using reasonable
due diligence, should have known) of its occurrence

             (d)        Any default in the payment or
performance of any obligation, or any defined event of default, under the terms
of any contract or instrument (other than any of the Loan Documents) pursuant
to which Borrower or any Subsidiary has incurred any debt or other liability to
any person or entity, including Bank, and, if such debt or liability is owed to
a party other than Bank (i) the aggregate amount thereof exceeds $250,000.00
and such default continues beyond any applicable grace period, (ii) the holder
of such debt or liability has the right to accelerate the same by reason of
such default, or (iii) such debt or liability is or has been declared to be due
and payable or required to be prepaid (other than by regularly scheduled
required prepayment) prior to the stated maturity date.

             (e)         The filing of a notice of judgment lien
against Borrower or any Subsidiary; or the recording of any abstract of
judgment against Borrower or any Subsidiary in any county in which Borrower or
such Subsidiary has an interest in real property; or the service of a notice of
levy and/or of a writ of attachment or execution, or other like process,
against the assets of Borrower or any Subsidiary or the entry of a judgment
against Borrower or any Subsidiary; and with respect to any of the foregoing,
the amount thereof exceeds $500,000.00 (to the extent not fully insured) and
the proceeding is not dismissed or vacated within 30 days after its occurrence.

             (f)         Borrower or any Subsidiary shall become
insolvent, or shall suffer or consent to or apply for the appointment of a
receiver, trustee, custodian or liquidator of itself or any or a material
portion of its property, or shall generally fail to pay its debts as they
become due, or shall make a general assignment for the benefit of creditors;
Borrower or any Subsidiary shall file a voluntary petition in bankruptcy, or
seeking reorganization, in order to effect a plan or other arrangement with
creditors or any other relief under the Bankruptcy Reform Act, Title 11 of the
United States Code, as amended or recodified from time to time
("Bankruptcy Code"), or under any state or federal law granting
relief to debtors, whether now or hereafter in effect; or any involuntary
petition or proceeding pursuant to the Bankruptcy Code or any other applicable
state or federal law relating to bankruptcy, reorganization or other relief for
debtors is filed or commenced against Borrower or any Subsidiary (and, if filed
against Borrower or a Subsidiary, the proceeding is not dismissed within 90
days after such filing), or Borrower or any such Subsidiary shall file an
answer admitting the jurisdiction of the court and the material allegations of
any involuntary petition; or Borrower or any such Subsidiary shall be
adjudicated a bankrupt, or an order for relief shall be entered against
Borrower or any such Subsidiary by any court of competent jurisdiction under
the Bankruptcy Code or any other applicable state or federal law relating to
bankruptcy, reorganization or other relief for debtors.

             (g)        There shall occur any material adverse
change in the operations, business or condition (including the financial
condition), of the Borrower and Subsidiaries, taken as a whole after the date
of this Agreement.

.            (h)        The dissolution or liquidation of
Borrower or any Subsidiary; or Borrower or any such Subsidiary, or any of their
directors, stockholders or members, shall take action seeking to effect the
dissolution or liquidation of Borrower or such Subsidiary, except as otherwise
permitted in this Agreement.

             SECTION
6.2.                REMEDIES. Upon the
occurrence of any Event of Default: (a) all indebtedness of Borrower under each
of the Loan Documents, any term thereof to the contrary notwithstanding, shall
at Bank's option and without further notice become immediately due and payable
without presentment, demand, protest or notice of dishonor, all of which are
hereby expressly waived by each Borrower; (b) the obligation, if any, of Bank
to extend any further credit under any of the Loan Documents shall immediately
cease and terminate; and (c) Bank shall have all rights, powers and remedies
available under each of the Loan Documents, or accorded by law, including
without limitation the right to resort to any or all security for any credit
subject hereto and to exercise any or all of the rights of a beneficiary or
secured party pursuant to applicable law. All rights, powers and remedies of
Bank may be exercised at any time by Bank and from time to time after the
occurrence of an Event of Default, are cumulative and not exclusive, and shall
be in addition to any other rights, powers or remedies provided by law or
equity.

ARTICLE
VII

MISCELLANEOUS

             SECTION
7.1.                NO WAIVER. No delay,
failure or discontinuance of Bank in exercising any right, power or remedy
under any of the Loan Documents shall affect or operate as a waiver of such
right, power or remedy; nor shall any single or partial exercise of any such
right, power or remedy preclude, waive or otherwise affect any other or further
exercise thereof or the exercise of any other right, power or remedy. Any
waiver, permit, consent or approval of any kind by Bank of any breach of or
default under any of the Loan Documents must be in writing and shall be effective
only to the extent set forth in such writing.

             SECTION
7.2.                NOTICES. All notices,
requests and demands which any party is required or may desire to give to any
other party under any provision of this Agreement must be in writing delivered
to each party at the following address:

	 	BORROWER:	NORTHWEST
  PIPE COMPANY
	 	200
  S.W. MARKET STREET, SUITE 1800
	 	PORTLAND
  OR 97201
	 	 
	 	BANK:	WELLS
  FARGO BANK, NATIONAL ASSOCIATION
	 	PORTLAND
  RCBO
	 	1300
  S.W. Fifth Avenue T-13
	 	Portland
  OR 97201

or to such other address as any party may
designate by written notice to all other parties. Each such notice, request and
demand shall be deemed given or made as follows: (a) if sent by hand delivery,
upon delivery; (b) if sent by mail, upon the earlier of the date of receipt or
three (3) days after deposit in the U.S. mail, first class and postage prepaid;
and (c) if sent by telecopy, upon receipt.

             SECTION
7.3.                COSTS, EXPENSES AND
ATTORNEYS' FEES. Borrower shall pay to Bank immediately upon demand the full amount of all payments, advances, charges, costs and expenses,
including reasonable attorneys' fees (to include outside counsel fees and all
allocated costs of Bank's in-house counsel), expended or incurred by Bank in
connection with (a) the negotiation and preparation of this Agreement and the
other Loan, Bank's continued administration hereof and thereof, and the
preparation of any amendments and waivers
hereto and thereto, (b) the enforcement of Bank's rights and/or the
collection of any amounts which become due to Bank under any of the Loan
Documents, and (c) the prosecution or defense of any action in any way related
to any of the Loan Documents, including without limitation, any action for
declaratory relief, whether incurred at the trial or appellate level, in an arbitration
proceeding or otherwise, and including any of the foregoing incurred in
connection with any bankruptcy proceeding (including without limitation, any
adversary proceeding, contested matter or motion brought by Bank or any other
person) relating to any Borrower or any other person or entity.

             SECTION
7.4.                SUCCESSORS,
ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of
the heirs, executors, administrators, legal representatives, successors and
assigns of the parties; provided however, that Borrower may not assign or
transfer its interest hereunder without Bank's prior written consent. Bank
reserves the right, subject to Borrower's prior written consent, not to be
unreasonably withheld, to sell, assign, transfer, negotiate or grant
participations in all or any part of, or any interest in, Bank's rights and
benefits under each of the Loan Documents. Notwithstanding the foregoing, Bank
may sell participations, without Borrower's consent, in all or any portion of
the Line of Credit and the Loan Documents, but such sales shall not entitle the
participant(s) to any direct rights against Borrower under the terms of this
Agreement or any of the other Loan Documents. Any outright sale or assignment
of Bank's rights hereunder must be to a commercial bank organized under the
laws of the United States or any state thereof, having a combined capital and
surplus of at least $100,000,000.00. In connection with any assignment or
participation hereunder, Bank may disclose all documents and information which
Bank now has or may hereafter acquire relating to any credit subject hereto,
Borrower or its business, any guarantor hereunder or the business of such
guarantor, or any collateral required hereunder, subject to the terms of a
confidentiality agreement customarily used by Bank in connection therewith.

             SECTION 7.5.                ENTIRE
AGREEMENT; AMENDMENT. This Agreement and the other Loan Documents constitute
the entire agreement between Borrower and Bank with respect to each credit
subject hereto and supersede all prior negotiations, communications,
discussions and correspondence concerning the subject matter hereof. This
Agreement may be amended or modified only in writing signed by each party
hereto.

             SECTION 7.6.                NO THIRD PARTY BENEFICIARIES. This Agreement is made
and entered into for the sole protection and benefit of the parties hereto and
their respective permitted successors and assigns, and no other person or
entity shall be a third party beneficiary of, or have any direct or indirect
cause of action or claim in connection with, this Agreement or any other of the
Loan Documents to which it is not a party.

             SECTION 7.7.                TIME. Time is of the essence of each and every
provision of this Agreement and each other of the Loan Documents.

             SECTION 7.8.                SEVERABILITY OF PROVISIONS. If any provision of this
Agreement shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity without invalidating the remainder of such provision or any
remaining provisions of this Agreement.

             SECTION 7.9.                COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which when executed and delivered shall be
deemed to be an original, and all of which when taken together shall constitute
one and the same Agreement.

             SECTION 7.10.              GOVERNING LAW. This Agreement
shall be governed by and construed in accordance with the laws of the State of
Oregon.

             SECTION 7.11.              ARBITRATION.

             (a)         Arbitration.
The parties hereto agree, upon demand by any party, to submit to binding
arbitration all claims, disputes and controversies between or among them (and
their respective employees, officers, directors, attorneys, and other agents),
whether in tort, contract or otherwise arising out of or relating to in any way
(i) the loan and related Loan Documents which are the subject of this Agreement
and its negotiation, execution, collateralization, administration, repayment,
modification, extension, substitution, formation, inducement, enforcement, default
or termination; or (ii) requests for additional credit.

             (b)        Governing
Rules. Any arbitration proceeding will (i) proceed in a location in Oregon
selected by the American Arbitration Association ("AAA"); (ii) be
governed by the Federal Arbitration Act (Title 9 of the United States Code),
notwithstanding any conflicting choice of law provision in any of the documents
between the parties; and (iii) be conducted by the AAA, or such other
administrator as the parties shall mutually agree upon, in accordance with the
AAA's commercial dispute resolution procedures, unless the claim or
counterclaim is at least $1,000,000.00 exclusive of claimed interest,
arbitration fees and costs in which case the arbitration shall be conducted in
accordance with the AAA's optional procedures for large, complex commercial
disputes (the commercial dispute resolution procedures or the optional
procedures for large, complex commercial disputes to be referred to, as
applicable, as the "Rules"). If there is any inconsistency between
the terms hereof and the Rules, the terms and procedures set forth herein shall
control. Any party who fails or refuses to submit to arbitration following a
demand by any other party shall bear all costs and expenses incurred by such
other party in compelling arbitration of any
dispute. Nothing contained herein shall be deemed to be a waiver by any party
that is a bank of the protections afforded to it under 12 U.S.C. §91 or any
similar applicable state law.

             (c)         No Waiver of Provisional Remedies, Self-Help and Foreclosure. The arbitration requirement does not
limit the right of any party to (i) foreclose against real or personal property
collateral; (ii) exercise self-help remedies relating to collateral or proceeds
of collateral such as setoff or repossession; or (iii) obtain provisional or
ancillary remedies such as replevin, injunctive relief, attachment or the
appointment of a receiver, before during or after the pendency of any
arbitration proceeding. This exclusion does not constitute a waiver of the
right or obligation of any party to submit any dispute to arbitration or
reference hereunder, including those arising from the exercise of the actions
detailed in sections (i), (ii) and (iii) of this paragraph.

             (d)         Arbitrator Qualifications and Powers.
Any arbitration proceeding in which the amount in controversy is $5,000,000.00
or less will be decided by a single arbitrator selected according to the Rules,
and who shall not render an award of greater than $5,000,000.00. Any dispute in
which the amount in controversy exceeds $5,000,000.00 shall be decided by
majority vote of a panel of three arbitrators: provided however, that all three
arbitrators must actively participate in all hearings and deliberations. The
arbitrator will be a neutral attorney licensed in the State of Oregon or a
neutral retired judge of the state or federal judiciary of Oregon, in either
case with a minimum of ten years experience in the substantive law applicable
to the subject matter of the dispute to be arbitrated. The arbitrator will
determine whether or not an issue is arbitratable and will give effect to the
statutes of limitation in determining any claim. In any arbitration proceeding
the arbitrator will decide (by documents only or with a hearing at the
arbitrator's discretion) any pre-hearing motions which are similar to motions
to dismiss for failure to state a claim or motions for summary adjudication.
The arbitrator shall resolve all disputes in accordance with the substantive
law of Oregon and may grant any remedy or relief that a court of such state
could order or grant within the scope hereof and such ancillary relief as is
necessary to make effective any award. The arbitrator shall also have the power
to award recovery of all costs and fees, to impose sanctions and to take such
other action as the arbitrator deems necessary to the same extent a judge could
pursuant to the Federal Rules of Civil Procedure, the Oregon Rules of Civil
Procedure or other applicable law. Judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction. The institution and
maintenance of an action for judicial relief or pursuit of a provisional or
ancillary remedy shall not constitute a waiver of the right of any party,
including the plaintiff, to submit the controversy or claim to arbitration if
any other party contests such action for judicial relief.

             (e)         Discovery. In any arbitration
proceeding discovery will be permitted in accordance with the Rules. All
discovery shall be expressly limited to matters directly relevant to the
dispute being arbitrated and must be completed no later than 20 days before the
hearing date and within 180 days of the filing of the dispute with the AAA. Any
requests for an extension of the discovery periods, or any discovery disputes,
will be subject to final determination by the arbitrator upon a showing that
the request for discovery is essential for the party's presentation and that no
alternative means for obtaining information is available.

             (f)         Class Proceedings and Consolidations.
The resolution of any dispute arising pursuant to the terms of this Agreement
shall be determined by a separate arbitration proceeding and such dispute shall
not be consolidated with other disputes or included in any class proceeding.

             (g)        Payment Of Arbitration Costs And Fees.
The arbitrator shall award all costs and expenses of the arbitration
proceeding.

             (h)        Miscellaneous. To the maximum
extent practicable, the AAA, the arbitrators and the parties shall take all
action required to conclude any arbitration proceeding within 180 days of the
filing of the dispute with the AAA. No arbitrator or other party to an
arbitration proceeding may disclose the existence, content or results thereof,
except for disclosures of information by a party required in the ordinary
course of its business or by applicable law or regulation. If more than one
agreement for arbitration by or between the parties potentially applies to a
dispute, the arbitration provision most directly related to the Loan Documents
or the subject matter of the dispute shall control. This arbitration provision,
as it pertains to the Loan Documents and the Line of Credit, shall survive
termination, amendment or expiration of any of the Loan Documents or any
relationship between the parties.

UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS
MADE BY BANK AFTER OCTOBER 3, 1989 CONCERNING LOANS AND OTHER CREDIT EXTENSIONS
WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY
THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE
SIGNED BY BANK TO BE ENFORCEABLE.

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

	NORTHWEST
  PIPE COMPANY	 	WELLS
  FARGO BANK, NATIONAL ASSOCIATION
	 	 	 
	By:
  /s/ BRIAN W. DUNHAM	 	By:
  /s/ STEPHEN J. DAY
	

	 	

	 	 	Stephen
  J. Day
	Title:
  President & CEO	 	Title:
  Vice President

EXHIBIT
A

REVOLVING LINE OF CREDIT NOTE

	$30,000,000.00	Portland,
  Oregon
	 	May
  30, 2001

             FOR
VALUE RECEIVED, the undersigned NORTHWEST PIPE COMPANY ("Borrower")
promises to pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION
("Bank") at its office at Portland RCBO, 1300 S.W. Fifth Avenue T-13,
Portland, Oregon, or at such other place as the holder hereof may designate, in
lawful money of the United States of America and in immediately available
funds, the principal sum of Thirty Million Dollars ($30,000,000.00), or so much
thereof as may be advanced and be outstanding, with interest thereon, to be
computed on each advance from the date of its disbursement as set forth herein.

DEFINITIONS:

             As
used herein, the following terms shall have the meanings set forth after each,
and any other term defined in this Note shall have the meaning set forth at the
place defined:

             (a)         "Business Day" means any day
except a Saturday, Sunday or any other day on which commercial banks in Oregon
are authorized or required by law to close.

             (b)        "Fixed Rate Term" means a
period commencing on a Business Day and continuing for 1, 2, 3 or 6 months, as
designated by Borrower, during which all or a portion of the outstanding
principal balance of this Note bears interest determined in relation to LIBOR;
provided however, that no Fixed Rate Term may be selected for a principal
amount less than Two Hundred and Fifty Thousand Dollars ($250,000.00); and
provided further, that no Fixed Rate Term shall extend beyond the scheduled
maturity date hereof. If any Fixed Rate Term would end on a day which is not a
Business Day, then such Fixed Rate Term shall be extended to the next
succeeding Business Day.

             (c)         "LIBOR" means the rate per
annum (rounded upward, if necessary, to the nearest whole 1/8 of 1%) and
determined pursuant to the following formula:

	LIBOR	 	Base LIBOR
	=	

	 	100% – LIBOR
  Reserve Percentage

                           (i)          "Base LIBOR" means the rate
per annum for United States dollar deposits quoted by Bank as the Inter-Bank
Market Offered Rate, with the understanding that such rate is quoted by Bank
for the purpose of calculating effective rates of interest for loans making reference
thereto, on the first day of a Fixed Rate Term for delivery of funds on said
date for a period of time approximately equal to the number of days in such
Fixed Rate Term and in an amount approximately equal to the principal amount to
which such Fixed Rate Term applies. Borrower understands and agrees that Bank
may base its quotation of the Inter-Bank Market Offered Rate upon such offers
or other market indicators of the Inter-Bank Market as Bank in its discretion
deems appropriate including, but not limited to, the rate offered for U.S.
dollar deposits on the London Inter-Bank Market.

                           (ii)         "LIBOR Reserve Percentage"
means the reserve percentage prescribed by the Board of Governors of the
Federal Reserve System (or any successor) for "Eurocurrency Liabilities"
(as defined in Regulation D of the Federal Reserve Board, as amended), adjusted by Bank for expected changes
in such reserve percentage during the applicable Fixed Rate Term.

             (d)        "Prime Rate" means at any time
the rate of interest most recently announced within Bank at its principal
office as its Prime Rate, with the understanding that the Prime Rate is one of
Bank's base rates and serves as the basis upon which effective rates of
interest are calculated for those loans making reference thereto, and is
evidenced by the recording thereof after its announcement in such internal
publication or publications as Bank may designate.

INTEREST:

             (a)         Interest. The outstanding
principal balance of this Note shall bear interest (computed on the basis of a
360-day year, actual days elapsed) either (i) at a fluctuating rate per annum
one half percent (0.50%) below the Prime Rate in effect from time to time, or
(ii) at a fixed rate per annum determined by Bank to be one and one half
percent above LIBOR in effect of the first day of each Fixed Rate Term. When
interest is determined in relation to the Prime Rate, each change in the rate
of interest hereunder shall become effective on the date each Prime Rate change
is announced within Bank. With respect to each LIBOR selection hereunder, Bank
is hereby authorized to note the date, principal amount, interest rate and
Fixed Rate Term applicable thereto and any payments made thereon on Bank's
books and records (either manually or by electronic entry) and/or on any schedule
attached to this Note, which notations shall be prima facie evidence of the
accuracy of the information noted.

             (b)        Selection of Interest Rate Options.
At any time any portion of this Note bears interest determined in relation to
LIBOR, it may be continued by Borrower at the end of the Fixed Rate Term
applicable thereto so that all or a portion thereof bears interest determined
in relation to the Prime Rate or to LIBOR for a new Fixed Rate Term designated
by Borrower. At any time any portion of this Note bears interest determined in
relation to the Prime Rate, Borrower may convert all or a portion thereof so
that it bears interest determined in relation to LIBOR for a Fixed Rate Term
designated by Borrower. At such time as Borrower requests an advance hereunder
or wishes to select a LIBOR option for all or a portion of the outstanding
principal balance hereof, and at the end of each Fixed Rate Term, Borrower
shall give Bank notice specifying: (i) the interest rate option selected by
Borrower; (ii) the principal amount subject thereto; and (iii) for each LIBOR
selection, the length of the applicable Fixed Rate Term. Any such notice may be
given by telephone (or such other electronic method as Bank may permit) so long
as, with respect to each LIBOR selection, (A) if requested by Bank, Borrower
provides to Bank written confirmation thereof not later than three (3) Business
Days after such notice is given, and (B) such notice is given to Bank prior to
10:00 a.m. on the first day of the Fixed Rate Term, or at a later time during
any Business Day if Bank, at it's sole option but without obligation to do so,
accepts Borrower's notice and quotes a fixed rate to Borrower. If Borrower does
not immediately accept a fixed rate when quoted by Bank, the quoted rate shall
expire and any subsequent LIBOR request from Borrower shall be subject to a
redetermination by Bank of the applicable fixed rate. If no specific
designation of interest is made at the time any advance is requested hereunder
or at the end of any Fixed Rate Term, Borrower shall be deemed to have made a
Prime Rate interest selection for such advance or the principal amount to which
such Fixed Rate Term applied.

             (c)         Taxes and Regulatory Costs. Borrower shall pay to Bank
immediately upon demand, in addition to any other amounts due or to become due
hereunder, any and all (i) withholdings, interest equalization taxes, stamp
taxes or other taxes (except income and franchise taxes) imposed by any
domestic or foreign governmental authority and related in any manner to LIBOR,
and (ii) future, supplemental, emergency or other changes in the LIBOR Reserve
Percentage, assessment rates imposed by the Federal Deposit Insurance
Corporation, or similar requirements or costs imposed by any domestic or
foreign governmental authority or resulting from compliance by Bank with any
request or directive (whether or not having the force of law) from any central
bank or other governmental authority and related in any manner to LIBOR to the
extent they are not included in the calculation of LIBOR. In determining which
of the foregoing are attributable to any LIBOR option available to Borrower
hereunder, any reasonable allocation made by Bank among its operations shall be
conclusive and binding upon Borrower.

             (d)        Payment of Interest. Interest
accrued on this Note shall be payable on the first day of each month,
commencing June 1, 2001 and on the maturity date of this Note.

             (e)         Default Interest. From and after
the maturity date of this Note, or such earlier date as all principal owing hereunder
becomes due and payable by acceleration or otherwise, the outstanding principal
balance of this Note shall bear interest until paid in full at an increased
rate per annum (computed on the basis of a 360-day year, actual days elapsed)
equal to three percent (3.00%) above the rate of interest from time to time
applicable to this Note.

BORROWING AND REPAYMENT:

             (a)         Borrowing and Repayment.
Borrower may from time to time during the term of this Note borrow, partially
or wholly repay its outstanding borrowings, and reborrow, subject to all of the
limitations, terms and conditions of this Note and of any document executed in
connection with or governing this Note; provided however, that the total
outstanding borrowings under this Note shall not at any time exceed the
principal amount stated above. The unpaid principal balance of this obligation
at any time shall be the total amounts advanced hereunder by the holder hereof
less the amount of principal payments made hereon by or for any Borrower, which
balance may be endorsed hereon from time to time by the holder. The outstanding
principal balance of this Note shall be due and payable in full on June 30,
2003.

             (b)        Advances. Advances hereunder, to
the total amount of the principal sum stated above, may be made by the holder
at the oral or written request of (i) Paul Parsons, Mike Van Note, Al Rose or
John Murakami, any one acting alone, who are authorized to request advances and
direct the disposition of any advances until written notice of the revocation of
such authority is received by the holder at the office designated above, or
(ii) any person, with respect to advances deposited to the credit of any
deposit account of any Borrower, which advances, when so deposited, shall be
conclusively presumed to have been made to or for the benefit of each Borrower
regardless of the fact that persons other than those authorized to request
advances may have authority to draw against such account. The holder shall have
no obligation to determine whether any person requesting an advance is or has
been authorized by any Borrower.

             (c)         Application of Payments. Each
payment made on this Note shall be credited first, to any interest then due and
second, to the outstanding principal balance hereof. All payments credited to
principal shall be applied first, to the outstanding principal balance of this
Note which bears interest determined in relation to the Prime Rate, if any, and
second, to the outstanding principal balance of this Note which bears interest
determined in relation to LIBOR, with such payments applied to the oldest Fixed
Rate Term first.

PREPAYMENT:

             (a)         Prime Rate. Borrower may prepay
principal on any portion of this Note which bears interest determined in
relation to the Prime Rate at any time, in any amount and without penalty.

             (b)        LIBOR. Borrower may prepay
principal on any portion of this Note which bears interest determined in
relation to LIBOR at any time and in the minimum amount of One Hundred Thousand
Dollars ($100,000.00); provided however, that if the outstanding principal
balance of such portion of this Note is less than said amount, the minimum
prepayment amount shall be the entire outstanding principal balance thereof. In
consideration of Bank providing this prepayment option to Borrower, or if any such
portion of this Note shall become due and payable at any time prior to the last
day of the Fixed Rate Term applicable thereto by acceleration or otherwise,
Borrower shall pay to Bank immediately upon demand a fee which is the sum of
the discounted monthly differences for each month from the month of prepayment
through the month in which such Fixed Rate Term matures, calculated as follows
for each such month:

	 	(i)	Determine
  the amount of interest which would have accrued each month on the amount
  prepaid at the interest rate applicable to such amount had it remained
  outstanding until the last day of the Fixed Rate Term applicable thereto.
	 	 	 
	 	(ii)	Subtract
  from the amount determined in (i) above the amount of interest which would
  have accrued for the same month on the amount prepaid for the remaining term
  of such Fixed Rate Term at LIBOR in effect on the date of prepayment for new
  loans made for such term and in a principal amount equal to the amount
  prepaid.
	 	 	 
	 	(iii)	If
  the result obtained in (ii) for any month is greater than zero, discount that
  difference by LIBOR used in (ii) above.

Each Borrower acknowledges that
prepayment of such amount may result in Bank incurring additional costs,
expenses and/or liabilities, and that it is difficult to ascertain the
full-extent of such costs, expenses and/or liabilities. Each Borrower,
therefore, agrees to pay the above-described prepayment fee and agrees that
said amount represents a reasonable estimate of the prepayment costs, expenses
and/or liabilities of Bank. If Borrower fails to pay any prepayment fee when
due, the amount of such prepayment fee shall thereafter bear interest until
paid at a rate per annum two percent (2.00%) above the Prime Rate in effect
from time to time (computed on the basis of a 360-day year, actual days
elapsed). Each change in the rate of interest on any such past due prepayment
fee shall become effective on the date each Prime Rate change is announced
within Bank.

EVENTS OF DEFAULT:

             This
Note is made pursuant to and is subject to the terms and conditions of that
certain Credit Agreement between Borrower and Bank dated as of May 1, 2001, as
amended from time to time (the "Credit Agreement"). Any defined event
of default under the Credit Agreement, shall constitute an "Event of Default"
under this Note.

MISCELLANEOUS:

             (a)         Remedies. Upon the occurrence of
any Event of Default, the holder of this Note, at the holder's option and
without further notice, may declare all sums of principal and interest
outstanding hereunder to be immediately due and payable without presentment,
demand, notice of nonperformance, notice of protest, protest or notice of
dishonor, all of which are expressly waived by each Borrower, and the
obligation, if any, of the holder to extend any further credit hereunder shall
immediately cease and terminate. Each Borrower shall pay to the holder
immediately upon demand the full amount of all payments, advances, charges,
costs and expenses, including reasonable 
attorneys' fees (to include outside counsel fees and all allocated costs
of the holder's in-house counsel), expended or incurred by the holder in
connection with the enforcement of the holders rights and/or the collection of
any amounts which become due to the holder under this Note, and the prosecution
or defense of any action in any way related to this Note, including without
limitation, any action for declaratory relief, whether incurred at the trial or
appellate level, in an arbitration proceeding or otherwise, and including any
of the foregoing incurred in connection with any bankruptcy proceeding
(including without limitation, any adversary proceeding, contested matter or
motion brought by Bank or any other person) relating to any Borrower or any
other person or entity.

             (b)        Obligations Joint and Several.
Should more than one person or entity sign this Note as a Borrower, the
obligations of each such Borrower shall be joint and several.

             (c)         Governing Law. This Note shall
be governed by and construed in accordance with the laws of the State of
Oregon.

UNDER
OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY BANK AFTER
OCTOBER 3, 1989 CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR
PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER'S
RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY BANK TO BE
ENFORCEABLE.

             IN
WITNESS WHEREOF, the undersigned has executed this Note as of the date first
written above.

	NORTHWEST
  PIPE COMPANY
	 
	By:
  /s/ BRIAN W. DUNHAM
	

	 
	Title:
  President & CEO
	

ADDENDUM TO PROMISSORY NOTE

(LIBOR PRICING ADJUSTMENTS)

             THIS
ADDENDUM is attached to and made a part of that certain promissory note
executed by NORTHWEST PIPE COMPANY ("Borrower") and payable to WELLS
FARGO BANK, NATIONAL ASSOCIATION ("Bank"), or order, dated as of May 30,
2001, in the principal amount of THIRTY MILLION Dollars ($30,000,000.00) (the
"Note").

             The
following provisions are hereby incorporated into the Note to reflect the
interest rate adjustments agreed to by Bank and Borrower:

INTEREST RATE ADJUSTMENTS:

             (a)         Initial LIBOR Margin. The
initial LIBOR margin applicable to this Note shall be as set forth in the
"Interest" paragraph herein.

             (b)        LIBOR Rate Adjustments. Bank
shall adjust the LIBOR margin used to determine the rate of interest applicable
to LIBOR options selected by Borrower under this Note on a quarterly basis,
commencing with Borrower's fiscal quarter ending June 30, 2001, if required to
reflect a change in Borrower’s ratio of Funded Debt to EBITDA (as defined in
the Credit Agreement referenced herein), in accordance with the following grid:

	Ratio of Funded Debt to
  EBITDA	 	Applicable

  LIBOR
Margin
	

	 	

	Greater
  than 2.50 to 1.00	 	2.00%
	Equal
  to or less than 2.50 to 1.00 and greater than 2.00 to 1.00	 	1.50%
	Equal
  to or less than 2.00 to 1.00 and greater than 1.50 to 1.00	 	1.25%
	Equal
  to or less than 1.50 to 1.00	 	1.00%

Each such adjustment shall be effective
on the first Business Day of Borrower's fiscal quarter following the quarter
during which Bank receives and reviews Borrower's most current fiscal
quarter-end financial statements in accordance with any requirements
established by Bank for the preparation and delivery thereof.

             IN
WITNESS WHEREOF, this Addendum has been executed as of the same date as the
Note.

	NORTHWEST
  PIPE COMPANY
	 
	By:
  /s/ BRIAN W. DUNHAM
	

	 
	Title:
  President & CEOPrepared by MerrillDirect

Exhibit
10.26

MASTER
LEASE AGREEMENT

Dated
as of

May
30, 2001

Between

GENERAL
ELECTRIC CAPITAL CORPORATION

Lessor

and

NORTHWEST
PIPE COMPANY

Lessee

MASTER LEASE AGREEMENT

TABLE OF CONTENTS

	1.	LEASING
	2.	TERM, RENT AND PAYMENT
	3	TAXES
	4.	DELIVERY, USE AND OPERATION
	5.	MAINTENANCE
	6.	INSURANCE
	7.	LOSS OR DAMAGE
	8.	REPORTS
	9	END OF
  LEASE OPTIONS
	 	(a)	Renewal
	 	(b)	Purchase
	 	(c)	Return
	 	(d)	Extension
	 	(e)	Notice of
  Election
	10.	DEEFAULT;
  REMEDIES
	11.	ASSIGNMENT
	12.	INDEMNIFICATION
	13.	OWNDERSHIP
  FOR TAX PURPOSES; GRANT OF SECURITY INTEREST; USURY SAVING
	14.	REPRESENTATIONS
  AND WARRANTIES OF LESSEE
	15.	CHOICE OF LAW; JURISDICTION
	16.	MISCELLANEOUS
	17.	CHATTEL PAPER

 

 

	EXHIBIT
  NO. 1 -  EQUIPMENT SCHEDULE
	ANNEX A - DESCRIPTION OF EQUIPMENT
	ANNEX B - BILL OF SALE
	ANNEX C - CERTIFICATE OF ACCEPTANCE
	ANNEX D - STIPULATED LOSS AND TERMINATION VALUE
  TABLE
	ANNEX E - AMORTIZATION SCHEDULE
	ANNEX F - RETURN PROVISIONS
	ANNEX G - PENDING PROCEEDINGS

 

MASTER LEASE AGREEMENT

             THIS
MASTER LEASE AGREEMENT ("Agreement") is made as of the 30th day
of May, 2001, between GENERAL ELECTRIC CAPITAL CORPORATION, with an office at 4
North Park Drive, Suite 500, Hunt Valley, Maryland 21030 (hereinafter called,
together with its successors and assigns, if any, "Lessor"), and NORTHWEST
PIPE COMPANY, an Oregon corporation with its mailing address and chief place of
business at 200 SW Market Street, Portland, Oregon 97201 (hereinafter called
"Lessee").

WITNESSETH:

1.          LEASE FINANCING:

             (a)
This Agreement shall be effective from and after the date of execution
hereof.  Subject to the terms and
conditions set forth below, Lessor agrees to lease to Lessee, and Lessee agrees
to lease from Lessor, the equipment ("Equipment") described in Annex A to
any schedule hereto ("Schedule").  Terms defined or specified in a Schedule and not otherwise
defined herein shall have the meanings ascribed to them in such Schedule.

             (b)
The obligation of Lessor to purchase the Equipment from Lessee and to lease the
same to Lessee shall be subject to receipt by Lessor, on or prior to the
earlier of the Lease Commencement Date or Last Delivery Date therefor, of each
of the following documents in form and substance satisfactory to Lessor:  (i) a Schedule relating to the Equipment
then to be leased hereunder, (ii) a Bill of Sale, in the form of Annex B to the
applicable Schedule, in favor of Lessor, (iii) evidence of insurance which
complies with the requirements of Section 6, and (iv) such other documents as
Lessor may reasonably request. 
Simultaneously with the execution of the Bill of Sale, Lessee shall also
execute a Certificate of Acceptance, in the form of Annex C to the applicable
Schedule, covering all of the Equipment described in the Bill of Sale. Upon
execution by Lessee of any Certificate of Acceptance, the Equipment described
thereon shall be deemed to have been delivered to, and irrevocably accepted by,
Lessee for lease hereunder.

             (c)         LESSEE
ACKNOWLEDGES THAT IT HAS SELECTED THE EQUIPMENT WITHOUT ANY ASSISTANCE FROM
LESSOR, ITS AGENTS OR EMPLOYEES.  LESSOR
DOES NOT MAKE, HAS NOT MADE, NOR SHALL BE DEEMED TO MAKE OR HAVE MADE, ANY
WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, WRITTEN OR ORAL, WITH
RESPECT TO THE EQUIPMENT LEASED HEREUNDER OR ANY COMPONENT THEREOF, INCLUDING,
WITHOUT LIMITATION, ANY WARRANTY AS TO DESIGN, COMPLIANCE WITH SPECIFICATIONS,
QUALITY OF MATERIALS OR WORKMANSHIP, MERCHANTABILITY, FITNESS FOR ANY PURPOSE,
USE OR OPERATION, SAFETY, PATENT, TRADEMARK OR COPYRIGHT INFRINGEMENT, OR
TITLE.  All such risks, as
between Lessor and Lessee, are to be borne by Lessee.  Without limiting the foregoing, Lessor shall have no
responsibility or liability to Lessee or any other person with respect to any
of the following (i) any liability, loss or damage caused or alleged to be
caused directly or indirectly by any Equipment, any inadequacy thereof, any
deficiency or defect (latent or otherwise) therein, or any other circumstance
in connection therewith; (ii) the use, operation or performance of any
Equipment or any risks relating thereto; (iii) any interruption of service,
loss of business or anticipated profits or consequential damages; or (iv) the
delivery, operation, servicing, maintenance, repair, improvement or replacement
of any Equipment.  If, and so long as,
no Default (as hereinafter defined) exists under this Agreement, Lessee shall
be, and hereby is, authorized during the Term (as hereinafter defined) to
assert and enforce, at Lessee's sole cost and expense, from time to time, in
the name of and for the account of Lessor and/or Lessee, as their interests may
appear, whatever claims and rights Lessor may have against any Supplier of the
Equipment.

2.          TERM, RENT AND PAYMENT:

             (a)
The rent payable hereunder (the "Rent") and Lessee's right to use the
Equipment shall commence on the date of execution by Lessee of the Certificate
of Acceptance for such Equipment (the "Lease Commencement Date").  The term of this Agreement (the "Term")
shall be the period specified in the applicable Schedule.  If any Term is extended or renewed, the word
"Term" shall be deemed to refer to all extended or renewed terms, and
all provisions of this Agreement shall apply during any extended or renewed
terms, except as otherwise may be specifically provided in writing.

             (b)
Rent shall be paid to Lessor by wire transfer of immediately available funds
to:  Bankers Trust New York, New York,
New York 10006, Account No. 50-260-660, ABA No. 021-001-033, or to such other
account as Lessor may direct in writing; and shall be effective upon receipt.  Payments of Rent shall be in the amount set
forth in, and due in accordance with, the provisions of the applicable
Schedule.  In no event shall any Rent
payments be refunded to Lessee.  If Rent
is not paid within ten (10) days of its due date, Lessee agrees to pay a late
charge of Five Cents ($0.05) per dollar on, and in addition to, the amount of
such Rent but not exceeding the lawful maximum, if any.

             (c)
This Agreement is a net lease.  Lessee's
obligation to pay Rent and other amounts due hereunder shall be absolute and
unconditional.  Lessee shall not be
entitled to any abatement or reductions of, or set-offs against, said Rent or
other amounts, including, without limitation, those arising or allegedly arising
out of claims (present or future, alleged or actual, and including claims
arising out of strict liability in tort or negligence of Lessor) of Lessee
against Lessor under this Agreement or otherwise.  This Agreement shall not terminate and the obligations of Lessee
shall not be affected by reason of any defect in or damage to, or loss of
possession, use or destruction of, any Equipment from whatsoever cause.  It is the intention of the parties that
Rents and other amounts due hereunder shall continue to be payable in all
events in the manner and at the times set forth herein unless the obligation to
do so shall have been terminated pursuant to the express terms hereof.

3.          TAXES:

             (a)
        Lessee shall have no liability for
taxes imposed by the United States of America or any State or political subdivision
thereof which are on or measured by the net income of Lessor.  Lessee shall report (to the extent that it
is legally permissible) and pay promptly all other taxes, fees and assessments
due, imposed, assessed or levied against any Equipment (or the purchase,
ownership, delivery, leasing, possession, use or operation thereof), this
Agreement (or any rentals or receipts hereunder), any Schedule, Lessor or
Lessee by any foreign, Federal, state or local government or taxing authority
during or related to the term of this Agreement,  including, without limitation, all license and registration fees,
and all sales, use, personal property, excise, gross receipts, franchise, stamp
or other taxes, imposts, duties and charges, together with any penalties, fines
or interest thereon (all hereinafter called "Taxes").  Lessee shall (i) (on an after-tax basis)
reimburse Lessor upon receipt of written request for reimbursement for any
Taxes charged to or assessed against Lessor, (ii) on request of Lessor, submit
to Lessor written evidence of Lessee's payment of Taxes, (iii) on all reports
or returns show the ownership of the Equipment by Lessee, and (iv) send a copy
thereof to Lessor.

             (b)        Lessee’s obligations, and Lessor’s
rights and privileges, contained in this Section 4 shall survive the expiration
or other termination of this Agreement.

4.          DELIVERY, USE AND
OPERATION.

             (a)  The parties acknowledge that this is a
sale/leaseback transaction and the Equipment is in Lessee's possession as of
the Lease Commencement Date.

             (b)  Lessee agrees that the Equipment will be
used by Lessee solely in the conduct of its business and in a manner complying
with all applicable Federal, state, and local laws and regulations, and any
applicable insurance policies, and Lessee shall not discontinue use of the
Equipment.

             (c)  Lessee will keep the Equipment free and
clear of all liens and encumbrances other than those which result from acts of
Lessor.

5.          MAINTENANCE:

             (a)
Lessee will, at its sole expense, maintain each unit of Equipment in good
operating order, repair, condition and appearance in accordance with
manufacturer's recommendations, normal wear and tear excepted.  Lessee shall, if at any time reasonably
requested by Lessor, affix in a prominent position on each unit of Equipment
plates, tags or other identifying labels showing the interest therein of
Lessor.

             (b)
Lessee will not, without the prior consent of Lessor, affix or install any
accessory, equipment or device on any Equipment if such addition will impair
the value, originally intended function or use of such Equipment.  All additions, repairs, parts, supplies,
accessories, equipment, and devices furnished, attached or affixed to any
Equipment which are not readily removable shall be made only in compliance with
applicable law, shall be free and clear of all liens, encumbrances or rights of
others, and shall become the property of Lessor.  Lessee will not, without the prior written consent of Lessor and
subject to such conditions as Lessor may impose for its protection, affix or
install any Equipment to or in any other personal or real property.

             (c)
Any alterations or modifications to the Equipment that may, at any time during
the term of this Agreement, be required to comply with any applicable law, rule
or regulation shall be made at the expense of Lessee.

6.          INSURANCE:

Lessee agrees, at its own expense, to keep all
Equipment insured for such amounts as specified in Paragraph D of the Equipment
Schedule and against such hazards as Lessor may require, including, but not
limited to, insurance for damage to or loss of such Equipment and liability
coverage for personal injuries, death or property damage, with Lessor named as
additional insured and with a loss payable clause in favor of Lessor, as its
interest may appear, irrespective of any breach of warranty or other act or
omission of Lessee.  All such policies
shall be with companies, and on terms, satisfactory to Lessor.  Lessee agrees to deliver to Lessor evidence
of insurance satisfactory to Lessor.  No
insurance shall be subject to any co-insurance clause.  Lessee hereby appoints Lessor as Lessee's
attorney-in-fact to make proof of loss and claim for insurance, and to make
adjustments with insurers and to receive payment of and execute or endorse all
documents, checks or drafts in connection with payments made as a result of
such insurance policies.  Any expense of
Lessor in adjusting or collecting insurance shall be borne by Lessee.  Lessee will not make adjustments with
insurers except (i) with respect to claims for damage to any unit of Equipment
where the repair costs do not exceed ten (10%) of such unit's fair market
value, or (ii) with Lessor's written consent. 
Said policies shall provide that the insurance may not be altered or cancelled
by the insurer until after thirty (30) days written notice to Lessor.  Provided that no Default has occurred and is
continuing hereunder, upon request of Lessee after Lessee has completed repairs
to the damaged Equipment Lessor shall apply proceeds of insurance to the cost
of such repairs. Otherwise, Lessor may, at its option, apply proceeds of
insurance, in whole or in part, to (i) repair or replace Equipment or any
portion thereof, or (ii) satisfy any obligation of Lessee to Lessor hereunder.

7.          LOSS OR
DAMAGE:

             (a)
Lessee hereby assumes and shall bear the entire risk of any loss, theft, damage
to, or destruction of, any unit of Equipment from any cause whatsoever from the
time the Equipment is shipped to Lessee.

(b) 
Lessee shall promptly and fully notify Lessor in writing if any unit of
Equipment shall be or become worn out, lost, stolen, destroyed, irreparably
damaged in the reasonable determination of Lessee, or permanently rendered
unfit for use from any cause whatsoever (such occurrences being hereinafter
called "Casualty Occurrences"). 
On the Rental Payment Date next succeeding a Casualty Occurrence (the
"Payment
Date"), Lessee shall pay Lessor the sum of (x) the Stipulated
Loss Value of such unit calculated in accordance with Annex D as of the Rent
Payment Date next preceding such Casualty Occurrence ("Calculation
Date"); and (y) all rental and other amounts which are due
hereunder as of the Payment Date.  Upon
payment of all sums due hereunder, the term of this lease as to such unit shall
terminate and (except in the case of the loss, theft or complete destruction of
such unit) Lessor shall be entitled to recover possession of such unit.

8.          REPORTS:

             (a)
Lessee will notify Lessor in writing, within ten (10) days after any tax or
other lien shall attach to any Equipment, of the full particulars thereof and
of the location of such Equipment on the date of such notification.

             (b)
Lessee will deliver to Lessor, within one hundred five (105) days of the close
of each fiscal year of Lessee, Lessee's balance sheet and profit and loss statement,
prepared in accordance with generally accepted accounting principles ("GAAP")
consistently applied, certified by a recognized firm of certified public
accountants, together with Lessee's Form 10K filed with the Securities and
Exchange Commission ("SEC"), if any.  Lessee will deliver to Lessor quarterly,
within sixty (60) days of the close of each fiscal quarter of Lessee, in
reasonable detail, copies of Lessee's quarterly financial report certified by
the chief financial officer of Lessee, together with Lessee's Form 10Q filed
with the SEC, if any.

             (c)
Lessee will permit Lessor to inspect any Equipment during normal business hours
upon reasonable notice.

             (d)
Lessee will keep the Equipment at the Equipment Location (specified in the
applicable Schedule) within the Continental United States and will promptly
notify Lessor of any relocation of Equipment. 
Upon the written request of Lessor, Lessee will notify Lessor forthwith
in writing of the location of any Equipment as of the date of such notification.

             (e)
Lessee will promptly and fully report to Lessor in writing if any Equipment is
lost or damaged (where the estimated repair costs would exceed ten percent
(10%) of its then fair market value), or is otherwise involved in an accident
causing personal injury or property damage.

             (f)
Within thirty (30) days after any request by Lessor, Lessee will furnish a
certificate of an authorized officer of Lessee stating that he has reviewed the
activities of Lessee and that, to the best of his knowledge, there exists no
Default or event which, with the giving of notice or the lapse of time (or
both), would become such a Default.

9.          END OF LEASE
OPTIONS.

Upon the expiration of the Term of each
Schedule, Lessee shall return, or purchase, or extend or renew the Term with
respect to, all (but not less than all) of the Equipment leased under all
Schedules executed hereunder upon the following terms and conditions.

             (a)         Renewal.   So long as no Default has occurred and is
continuing hereunder and Lessee shall not have exercised its option to return
the Equipment or its purchase option pursuant to this Section, Lessee shall
have the option, upon the expiration of the Basic Term and/or the first Renewal
Term of the first Schedule to be executed under this Agreement, to renew the
Agreement with respect to all, but not less than all, of the Equipment leased
under all Schedules executed hereunder for an additional term of twelve (12)
months (each, a "Renewal Term") at the Renewal Term
Rent.  Including all Renewal Terms, the
maximum term of each Schedule to be executed under this Agreement shall be five
(5) years (the Basic Term plus two (2) Renewal Terms) (the "Maximum
Lease Term").

             (b)        Purchase.   So long as Lessee shall not have exercised
its extension option or its option to renew this Agreement or its option to
return the Equipment pursuant to this Section, Lessee shall have the option,
upon the expiration of the Term of each Schedule, to purchase all (but not less
than all) of the Equipment described on all Schedules executed hereunder upon
the following terms and conditions:  If
Lessee desires to exercise this option with respect to the Equipment, Lessee
shall pay to Lessor on the last day of the Term with respect to each individual
Schedule, in addition to the scheduled Rent (if any) then due on such date and
all other sums then due hereunder, in cash the purchase price for the Equipment
so purchased, determined as hereinafter provided.  The purchase price of the Equipment shall be an amount equal to
the Fixed Purchase Price of such Equipment (as specified on the Schedule), plus
all taxes and charges upon sale and all other reasonable and documented
expenses incurred by Lessor in connection with such sale, including, without
limitation, any such expenses incurred based on a notice from Lessee to Lessor
that Lessee intended to return any such items of Equipment. Upon satisfaction
of the conditions specified in this Paragraph, Lessor will transfer, on an AS
IS, WHERE IS BASIS, without recourse or warranty, express or implied, of any
kind whatsoever (“AS IS BASIS”), all of Lessor's interest in and to the
Equipment. Lessor shall not be required to make and may specifically disclaim
any representation or warranty as to the condition of such Equipment and other
matters (except that Lessor shall warrant that it has conveyed whatever
interest it received in the Equipment free and clear of any lien or encumbrance
created by Lessor).  Lessor shall
execute and deliver to Lessee such Uniform Commercial Code Statements of
Termination as reasonably may be required in order to terminate any interest of
Lessor in and to the Equipment.

             (c)         Return.  Unless Lessee shall have exercised its
extension option or its purchase option pursuant to this Section, upon the
expiration of the Term of each Schedule, Lessee shall return all (but not less
than all) of the Equipment described on all Schedules executed hereunder, to
Lessor upon the following terms and conditions:  Lessee shall (i) pay to Lessor on the last day of the Term with
respect to each individual Schedule, in addition to the scheduled Rent then due
on such date and all other sums then due hereunder, a terminal rental
adjustment amount equal to the Fixed Purchase Price of such Equipment, and (ii)
return the Equipment to Lessor in accordance with the provisions of Annex F
attached hereto. Thereafter, Lessor and Lessee shall arrange for the
commercially reasonable sale, scrap or other disposition of the Equipment.  Upon satisfaction of the conditions specified
in this Paragraph, Lessor will transfer, on an AS IS BASIS, all of Lessor's
interest in and to the Equipment. 
Lessor shall not be required to make and may specifically disclaim any
representation or warranty as to the condition of such Equipment and other
matters (except that Lessor shall warrant that it has conveyed whatever
interest it received in the Equipment free and clear of any liens or
encumbrances created by Lessor).  Lessor
shall execute and deliver to Lessee such Uniform Commercial Code Statements of
Termination as reasonably may be required in order to terminate any interest of
Lessor in and to the Equipment.  Upon
the sale, scrap or other disposition of the Equipment the net sales proceeds
with respect to the Equipment sold will be paid to, and held and applied by,
Lessor as follows:  Lessor shall
promptly thereafter pay to Lessee an amount equal to the Residual Risk Amount
(as specified in the Schedule) of the Equipment (less all reasonable costs,
expenses and fees, including storage, reasonable and necessary maintenance and other
remarketing fees incurred in connection with the sale, scrap, or disposition of
such Equipment) plus all net proceeds, if any, of such sale in excess of the
Residual Risk Amount of the Equipment and applicable taxes, if any.

             (d)        Extension.  So long as no Default has occurred and is
continuing hereunder and Lessee shall not have exercised its option to return
the Equipment or its purchase option pursuant to this Section, and provided
that Lessee shall have exercised its option to renew this Agreement pursuant to
this Section with respect to all available Renewal Terms, Lessee shall have the
option, upon the expiration of all available Renewal Terms, to extend the
Agreement with respect to all, but not less than all, of the Equipment for an
additional term of twelve (12) months (the "Extension Term") at a
monthly rental to be paid in arrears on the same day of each month on which the
prior Renewal Term Rent installment was paid, and calculated as the product of
(i) the Capitalized Lessor's Cost, times (ii) a lease rate factor
calculated by Lessor, which when so multiplied times the Capitalized Lessor's
Cost, will result in a product that is equal to the amount necessary to fully
repay to Lessor any unpaid balance of the Capitalized Lessor's Cost (determined
as of the date on which the last available Renewal Term expired), together with
interest thereon at a rate per annum equal to three hundred seventy-five (375)
basis points over the then current yield to maturity of U.S. Treasury Notes
having a one year maturity, in twelve (12) equal monthly installments.  At the end of the Extension Term, provided
that Lessee is not then in Default under this Agreement, Lessee shall purchase
all, and not less than all, of such Equipment for $1.00 cash, together with all
Rent and other sums then due on such date, plus all taxes and charges upon
transfer and all other reasonable and documented expenses incurred by Lessor in
connection with such transfer.  Upon
satisfaction of the conditions specified in this Paragraph, Lessor will
transfer, on an AS IS BASIS, all of Lessor's interest in and to the Equipment.
Lessor shall not be required to make and may specifically disclaim any
representation or warranty as to the condition of the Equipment and any other
matters (except that Lessor shall warrant that it has conveyed whatever
interest it received in the Equipment free and clear of any lien or encumbrance
created by Lessor).

             (e)         Notice of
Election.  Lessee shall give
Lessor written notice of its election of the options specified in this Section
not less than one hundred eighty (180) days nor more than three hundred
sixty-five (365) days before the expiration of the Basic Term or any Renewal
Term of the first Schedule to be executed under this Agreement.  Such election shall be effective with
respect to all Equipment described on all Schedules executed hereunder.  If Lessee fails timely to provide such
notice, without further action Lessee automatically shall be deemed to have
elected (1) to renew the Term of this Agreement pursuant to Paragraph (a) of
this Section if a Renewal Term is then available hereunder, or (2) to purchase
the Equipment pursuant to Paragraph (c) of this Section if a Renewal Term is
not then available hereunder.

10.        DEFAULT;
REMEDIES:

             (a)
Lessor may in writing declare this Agreement in default ("Default") if: (1)
Lessee breaches its obligation to pay Rent or any other sum when due and fails
to cure the breach within ten (10) days; (2) Lessee breaches any of its
insurance obligations under Section 6 hereof; (3) Lessee breaches any of its
other obligations hereunder and fails to cure that breach within thirty (30)
days after written notice thereof; (4) any representation or warranty made by
Lessee in connection with this Agreement shall be false or misleading in any
material respect; (5) Lessee or any guarantor or other obligor of Lessee’s
obligations hereunder (“Guarantor”) becomes insolvent or ceases to do business
as a going concern; (6) a petition is filed by or against Lessee or any
Guarantor under any bankruptcy or insolvency laws and, if filed against Lessee
or any Guarantor, shall not be dismissed within forty-five (45) days; (7)
Lessee or any Guarantor shall have terminated its corporate existence,
consolidated with, merged into, or conveyed or leased substan­tially all of its
assets as an entirety to any person (such actions being referred to as an
"Event"), unless not less than sixty (60) days prior to such
Event:  (x) such person is organized and
existing under the laws of the United States or any state, and executes and
delivers to Lessor an agreement containing an effective assumption by such
person of the due and punctual performance of this Agreement or guaranty
hereof, as the case may be; and (y) Lessor is reasonably satisfied as to the
credit­worthiness of such person; (8) there occurs a default under any guaranty
executed in connection with this Agreement and the applicable grace period with
respect thereto shall have expired; or (9) Lessee shall be in default under any
other agreement between Lessor and Lessee, 
or any other material obligation for borrowed money, for the deferred
purchase price of property or any lease agreement, and the applicable grace
period with respect thereto shall have expired; or (10)  Lessee or any Guarantor is a privately held
corporation and effective control of Lessee’s or any Guarantor’s voting capital
stock, issued and outstanding from time to time, is not retained by the present
stockholders (unless Lessee shall have provided sixty (60) days’ prior written
notice to Lessor of the proposed disposition of stock and Lessor shall have
consented thereto in writing); or (11) 
Lessee or any Guarantor is a publicly held corporation and as a result
of or in connection with a material change in the ownership of Lessee’s or any
Guarantor’s capital stock, Lessee’s or any Guarantor’s debt-to-worth ratio
equals or exceeds twice Lessee’s or any Guarantor’s debt-to-worth ratio as of
the date of this Agreement (unless Lessor shall have given its prior written
consent thereto).  As used herein, “debt-to-worth
ratio” shall mean the ratio of (x) total liabilities which, in
accordance with generally accepted accounting principles (“GAAP”) would be included in
the liability side of a balance sheet, to (y) tangible net worth including the sum
of the par or stated value of all outstanding capital stock, surplus and
undivided profits, less any amounts attributable to goodwill, patents,
copyrights, mailing lists, catalogs, trademarks, bond discount and underwriting
expenses, organization expense and other intangibles, all determined in
accordance with GAAP.  Any provision of
this Agreement to the contrary notwithstanding.  Lessor may exercise all rights and remedies hereunder
independently with respect to each Schedule.

             (b)
After Default, Lessee shall, without further demand, forthwith pay to Lessor
(i) as liquidated damages for loss of a bargain and not as a penalty, the
Stipulated Loss Value of the Equipment (calculated in accordance with Annex D
as of the Rent Payment Date next preceding the declaration of default), and
(ii) all Rents and other sums then due hereunder.  If Lessee fails to pay the amounts specified in the preceding
sentence, then, at the request of Lessor, Lessee shall comply with all the
return provisions set forth in the related Schedule and Annex F thereto.  Lessee hereby authorizes Lessor to enter,
with or without legal process, any premises where any Equipment is located and
take possession thereof.    Lessor may,
but shall not be required to, sell Equipment at private or public sale, in bulk
or in parcels, with or without notice, and without having the Equipment present
at the place of sale; or Lessor may, but shall not be required to, lease,
otherwise dispose of or keep idle all or part of the Equipment; and Lessor may use
Lessee's premises for any or all of the foregoing without liability for rent,
costs, damages or otherwise.  The
proceeds of sale, lease or other disposition, if any, shall be applied in the
following order of priorities:  (1) to
pay all of Lessor's costs, charges and expenses incurred in taking, removing,
holding, repairing and selling, leasing or otherwise disposing of Equipment;
then, (2) to the extent not previously paid by Lessee, to pay Lessor all sums
due from Lessee hereunder; then (3) to reimburse to Lessee any sums previously
paid by Lessee as liquidated damages; and (4) any surplus shall be paid to
Lessee.  Lessee shall pay any deficiency
in clauses (1) and (2) forthwith.

             (c)
In addition to the foregoing rights, Lessor may terminate the lease as to any
or all of the Equipment.

             (d)
The foregoing remedies are cumulative, and any or all thereof may be exercised
in lieu of or in addition to each other or any remedies at law, in equity, or
under statute.  Lessee waives notice of
sale or other disposition (and the time and place thereof), and the manner and
place of any advertising.  If permitted
by law, Lessee shall pay reasonable attorney's fees actually incurred by Lessor
in enforcing the provisions of this Lease and any ancillary documents.  Waiver of any default shall not be a waiver
of any other or subsequent default.

             (e)
Any default under the terms of this or any other agreement between Lessor and
Lessee may be declared by Lessor a default under this and any such other
agreement.

11.        ASSIGNMENT:

             (a)
LESSEE SHALL NOT ASSIGN, MORTGAGE, SUBLET OR HYPOTHECATE ANY EQUIPMENT OR THE
INTEREST OF LESSEE HEREUNDER WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR.

             (b)
Lessor may, without the consent of Lessee, assign this Agreement or any
Schedule, or the right to enter into any Schedule.  Lessee agrees that it will pay all Rent and other amounts payable
under each Schedule to the Lessor named therein; provided, however, if Lessee
receives written notice of an assignment from Lessor, Lessee will pay all Rent
and other amounts payable under any assigned Schedule to such assignee or as
instructed by Lessor.  Each Schedule,
incorporating by reference the terms and conditions of this Agreement,
constitutes a separate instrument of lease, and the Lessor named therein or its
assignee shall have all rights as "Lessor" thereunder separately
exercisable by such named Lessor or assignee as the case may be, exclusively
and independently of Lessor or any assignee with respect to other Schedules
executed pursuant hereto.  Without
limiting the generality of the foregoing, the grant of security interest in
Section 13(b) hereof shall, as it relates to the Equipment leased under each
Schedule (and to the proceeds and other collateral referred to in Section 13(b)
hereof), be deemed to have been granted solely to the Lessor named therein, or
to its assignee, as applicable and such Equipment (and other related
collateral) shall not be deemed to collateralize Lessee's obligations under any
of the Schedules to which such named Lessor or assignee, as the case may be, is
not a party.  Lessee further agrees to
confirm in writing receipt of a notice of assignment as reasonably may be
requested by assignee.  Lessee hereby
waives and agrees not to assert against any such assignee any defense, set–off,
recoupment claim or counterclaim which Lessee has or may at any time have
against Lessor or any other person for any reason whatsoever, provided,
however, Lessee may assert any claim it has against Lessor in a separate legal
action against Lessor.

             (c)  Lessee acknowledges that it has been advised
that General Electric Capital Corporation may act hereunder for itself and as
agent for certain third parties (each being herein referred to as a “Participant”
and, collectively, as the “Participants”); that the interest of the
Lessor in this Agreement, the Equipment Schedules, related instruments and
documents and/or the Equipment may be conveyed to, in whole or in part, and may
be used as security for financing obtained from, one or more third parties
without the consent of Lessee (the “Syndication”).  Lessee agrees reasonably to cooperate with Lessor in connection
with the Syndication, including the execution and delivery of such other
documents, instruments, notices, opinions, certificates and acknowledgements as
reasonably may be required by Lessor or such Participant; provided, however, in
no event shall Lessee be required to consent to any change that would adversely
affect any of the economic terms of the transactions contemplated herein.

             (d)
Subject always to the foregoing, this Agreement inures to the benefit of, and
is binding upon, the successors and assigns of the parties hereto.

12.        INDEMNIFICATION:

             (a)
Lessee hereby agrees to indemnify, save and keep harmless Lessor, its agents,
employees, successors and assigns (on an after-tax basis), from and against any
and all losses, damages, penalties, injuries, claims, actions and suits,
including legal expenses, of whatsoever kind and nature, in contract or tort,
and including, but not limited to, Lessor's strict liability in tort, arising
out of (i) the selection, manufacture, purchase, acceptance or rejection of
Equipment, the ownership of Equipment during the Term, and the delivery, lease,
possession, maintenance, uses, condition, return or operation of the Equipment
(including, without limitation, latent and other defects, whether or not
discoverable by Lessor or Lessee and any claim for patent, trademark or
copyright infringement or environmental damage), or (ii) the condition of
Equipment sold or disposed of after use by Lessee, any sublessee or employees
of Lessee.  Lessee shall, upon request,
defend any actions based on, or arising out of, any of the foregoing.

 (b) All
of Lessor's rights, privileges and indemnities contained in this Section shall
survive the expiration or other termination of this Agreement and the rights,
privileges and indemnities contained herein are expressly made for the benefit
of, and shall be enforceable by Lessor, its successors and assigns.

13.        OWNERSHIP FOR TAX PURPOSES; GRANT OF
SECURITY INTEREST; USURY SAVINGS.

             (a)
For income tax purposes, Lessor will treat Lessee as the owner of the
Equipment.  Accordingly, Lessor agrees
(i) to treat Lessee as the owner of the Equipment on its federal income tax
return, (ii) not to take actions or positions inconsistent with such treatment
on or with respect to its federal income tax return, and not claim any tax
benefits available to an owner of the Equipment on or with respect to its
federal income tax return.  The
foregoing undertakings by Lessor shall not be violated by Lessor's taking a tax
position through inadvertence so long as such inadvertent tax position is
reversed by Lessor promptly upon its discovery.  Lessor shall in no event be liable to Lessee if Lessee fails to secure
any of the tax benefits available to the owner of the Equipment.

             (b)
In order to secure the prompt payment of the Rent and all of the other amounts
from time to time outstanding under and with respect to the Schedules, and the
performance and observance by Lessee of all the agreements, covenants and
provisions hereof and thereof (including, without limitation, all of the
agreements, covenants and provisions of the Lease that are incorporated
therein), Lessee hereby grants to Lessor a first priority security interest in
the Equipment leased under the Schedules, together with all additions,
attachments, accessions, accessories and accessions thereto whether or not
furnished by the supplier of the Equipment and any and all substitutions,
replacements or exchanges therefor, in each such case in which Lessee shall
from time to time acquire an interest, and any and all insurance and/or other
proceeds (but without power of sale) of the property in and against which a
security interest is granted hereunder.

             (c)
It is the intention of the parties hereto to comply with any applicable usury
laws to the extent that any Schedule is determined to be subject to such laws;
accordingly, it is agreed that, notwithstanding any provision to the contrary
in any Schedule or the Lease, in no event shall any Schedule require the
payment or permit the collection of interest in excess of the maximum amount
permitted by applicable law.  If any
such excess interest is contracted for, charged or received under any Schedule
or the Lease, or in the event that all of the principal balance shall be
prepaid, so that under any of such circumstances the amount of interest
contracted for, charged or received under any Schedule or the Lease shall
exceed the maximum amount of interest permitted by applicable law, then in such
event  (1) the provisions of this
paragraph shall govern and control,  (2)
neither Lessee nor any other person or entity now or hereafter liable for the
payment hereof shall be obligated to pay the amount of such interest to the
extent that it is in excess of the maximum amount of interest permitted by
applicable law,  (3) any such excess
which may have been collected shall be either applied as a credit against the
then unpaid principal balance or refunded to Lessee, at the option of the
Lessor, and  (4) the effective rate of
interest shall be automatically reduced to the maximum lawful contract rate
allowed under applicable law as now or hereafter construed by the courts having
jurisdiction thereof.  It is further
agreed that without limitation of the foregoing, all calculations of the rate
of interest contracted for, charged or received under any Schedule or the Lease
which are made for the purpose of determining whether such rate exceeds the
maximum lawful contract rate, shall be made, to the extent permitted by
applicable law, by amortizing, prorating, allocating and spreading in equal
parts during the period of the full stated term of the indebtedness evidenced
hereby, all interest at any time contracted for, charged or received from
Lessee or otherwise by Lessor in connection with such indebtedness; provided,
however, that if any applicable state law is amended or the law of the United
States of America preempts any applicable state law, so that it becomes lawful
for Lessor to receive a greater interest per annum rate than is presently
allowed, the Lessee agrees that, on the effective date of such amendment or
preemption, as the case may be, the lawful maximum hereunder shall be increased
to the maximum interest per annum rate allowed by the amended state law or the
law of the United States of America (but not in excess of the interest rate
contemplated hereunder).

14.        REPRESENTATIONS AND WARRANTIES OF LESSEE:

Lessee hereby represents and warrants to Lessor
that on the date hereof and on the date of execution of each Schedule:

             (a)
Lessee has adequate power and capacity to enter into, and perform under, this
Agreement and all related documents (together, the "Documents") and is duly
qualified to do business wherever necessary to carry on its present business
and operations, including the jurisdiction(s) where the Equipment is or is to
be located.

             (b)
The Documents have been duly authorized, executed and delivered by Lessee and
constitute valid, legal and binding agreements, enforceable in accordance with
their terms, except to the extent that the enforcement of remedies therein
provided may be limited under applicable bankruptcy and insolvency laws.

             (c) No approval, consent or withholding
of objections is required from any governmental authority or instrumentality
with respect to the entry into or performance by Lessee of the Documents except
such as have already been obtained.

             (d)
The entry into and performance by Lessee of the Documents will not:  (i) 
violate any judgment, order, law or regulation applicable to Lessee or
any provision of Lessee's articles of incorporation, charter or by–laws;
or (ii) result in any breach of, constitute a default under or result in the
creation of any lien, charge, security interest or other encumbrance upon any
Equipment pursuant to any indenture, mortgage, deed of trust, bank loan or
credit agreement or other instrument (other than this Agreement) to which
Lessee is a party.

             (e)
Other than those set forth on Annex G, there are no suits or proceedings
pending or threatened in court or before any commission, board or other
administrative agency against or affecting Lessee, which will have a material
adverse effect on the ability of Lessee to fulfill its obligations under this
Agreement.

             (f)
The Equipment accepted under any Certificate of Acceptance is and will remain
tangible personal property.

             (g)
Each financial statement delivered to Lessor has been prepared in accordance
with GAAP, and since the date of the most recent such financial statement,
there has been no material adverse change.

             (h)
Lessee is duly incorporated and will be at all times validly existing and in
good standing under the laws of the state of its incorporation (specified in
the first sentence of this Agreement).

             (i)
The Equipment will at all times be used for commercial or business purposes.

15.        CHOICE OF
LAW; JURISDICTION:

THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO
THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE), INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, REGARDLESS OF THE LOCATION OF THE
EQUIPMENT.  The parties agree that any
action or proceeding arising out of or relating to this Agreement may be
commenced in the United States District Court for the Southern District of New
York.

16.        MISCELLANEOUS:

             (a)
LESSEE
HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION BASED UPON OR ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS LEASE, ANY
OF THE RELATED DOCUMENTS, ANY DEALINGS BETWEEN LESSEE AND LESSOR RELATING TO
THE SUBJECT MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS, AND/OR THE
RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN LESSEE AND LESSOR.  The scope of this waiver is intended to be
all encompassing of any and all disputes that may be filed in any court
(including, without limitation, contract claims, tort claims, breach of duty
claims, and all other common law and statutory claims).  THIS WAIVER IS IRREVOCABLE MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS LEASE,
ANY RELATED DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS
TRANSACTION OR ANY RELATED TRANSACTION.  In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.

             (b)
Any cancellation or termination by Lessor, pursuant to the provision of this
Agreement, any Schedule, supplement or amendment hereto, or the lease of any
Equipment hereunder, shall not release Lessee from any then outstanding
obligations to Lessor hereunder.

             (c)
All Equipment shall at all times remain personal property of Lessee regardless
of the degree of its annexation to any real property and shall not by reason of
any installation in, or affixation to, real or personal property become a part
thereof.

             (d)
Time is of the essence of this Agreement. 
Lessor's failure at any time to require strict performance by Lessee of
any of the provisions hereof shall not waive or diminish Lessor's right
thereafter to demand strict compliance therewith.

             (e)
Lessee agrees, upon Lessor's request, to execute any instrument necessary or
expedient for filing, recording or perfecting the interest of Lessor.

             (f)
All notices required to be given hereunder shall be in writing, personally
delivered, delivered by overnight courier service, or sent by certified mail,
return receipt requested, addressed to the other party at its respective
address stated above or at such other address as such party shall from time to
time designate in writing to the other party; and shall be effective from the
date of receipt.

             (g)
This Agreement and any Schedule and Annexes thereto constitute the entire
agreement of the parties with respect to the subject matter hereof.  NO VARIATION OR MODIFICATION OF THIS AGREEMENT OR ANY
WAIVER OF ANY OF ITS PROVISIONS OR CONDITIONS, SHALL BE VALID UNLESS IN WRITING
AND SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE PARTIES HERETO.  Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

             (h)
The representations, warranties and covenants of Lessee herein shall be
deemed  to survive the closing
hereunder. Lessor's obligations to acquire and lease specific items of
Equipment shall be conditioned upon Lessee providing to Lessor such information
with respect to Lessee's financial condition as Lessor may require, and Lessor
being satisfied that there shall have been no material adverse change in the
business or financial condition of Lessee from the date of execution
hereof.  The obligations of Lessee under
Sections 3, 9(c), 12 and 16(l) hereof which accrue during the term of this
Agreement and obligations which by their express terms survive the termination
of this Agreement, shall survive the termination of this Agreement.

             (i)
In case of a failure of Lessee to comply with any provision of this Agreement,
Lessor shall have the right, but shall not be obligated, to effect such
compliance, in whole or in part; and all moneys spent and expenses and
obligations incurred or assumed by Lessor in effecting such compliance (together
with interest thereon at the rate specified in Paragraph (j) of this Section)
shall constitute additional Rent due to Lessor within five (5) days after the
date Lessor sends notice to Lessee requesting payment.  Lessor's effecting such compliance shall not
be a waiver of Lessee's default.

             (j)
Any Rent or other amount not paid to Lessor when due hereunder shall bear
interest, both before and after any judgment or termination hereof, at the
lesser of eighteen percent (18%) per annum or the maximum rate allowed by law.

             (k)
Any provisions in this Agreement and any Schedule which are in conflict with
any statute, law or applicable rule shall be deemed omitted, modified or
altered to conform thereto.

             (l)  Lessee agrees to pay on demand all
reasonable costs and expenses incurred by Lessor in connection with the
preparation, execution, delivery, filing, recording, and administration of any
of the Documents, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for Lessor, and all costs and expenses, if
any, in connection with the enforcement of any of the Documents.  In addition, Lessee shall pay any and all
stamp and other taxes and fees payable or determined to be payable in
connection with the execution, delivery, filing and recording of any of the
Documents and the other documents to be delivered under the Documents, and
agrees to save Lessor harmless from and against any and all liabilities with
respect to or resulting from any delay attributed to Lessee in paying or
failing to pay such taxes and fees.

17.        CHATTEL
PAPER:

To the extent that any Schedule would constitute
chattel paper, as such term is defined in the Uniform Commercial Code as in
effect in any applicable jurisdiction, no security interest therein may be
created through the transfer or possession of this Agreement in and of itself
without the transfer or possession of the original of a Schedule executed
pursuant to this Agreement and incorporating this Agreement by reference; and
no security interest in this Agreement and a Schedule may be created by the
transfer or possession of any counterpart of the Schedule other than the
original thereof, which shall be identified as the document marked
"Original" and all other counterparts shall be marked "Duplicate".

IN
WITNESS WHEREOF,
Lessee and Lessor have caused this Master Lease Agreement to be executed by
their duly authorized representatives as of the date first above written.

	LESSOR:	 	LESSEE:
	 	 	 
	GENERAL ELECTRIC
  CAPITAL CORPORATION	 	NORTHWEST PIPE
  COMPANY
	 	 	 	 	 
	By:	/s/ Steven R.
  DeCarlo	 	By:	/s/Brian W. Dunham
	 	

	 	 	

	Name:	Steven R. DeCarlo	 	Name:	Brian W. Dunham
	 	

	 	 	

	Title:	Transaction &
  Syndication Manager	 	Title:	Chief Executive
  Officer
	 	

	 	 	

 

AMENDMENT TO MASTER LEASE AGREEMENT

             THIS AMENDMENT TO MASTER LEASE
AGREEMENT is made as of the 30th day of May, 2001, by and between
GENERAL ELECTRIC CAPITAL CORPORATION (“Lessor”) and NORTHWEST PIPE COMPANY  (“Lessee”).

             The parties have heretofore entered
into that certain Master Lease Agreement dated as of May 30, 2001 (the
“Lease”).  The parties desire to amend
the Lease pursuant to the terms and conditions hereinafter set forth.  Capitalized terms used herein without
definition shall have the meaning given them in the Lease.

             NOW, THEREFORE, in consideration of
the sum of Ten Dollars ($10.00) in hand paid, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties agree as follows:

	 	1.	Lessee covenants and agrees that Lessee shall,
  on a consolidated basis,  at all times
  during the term of the Lease and any Schedule executed pursuant thereto:

(a)         Maintain
a Tangible Net Worth, determined as of each fiscal quarter end, of not less
than an aggregate of (i) $85,000,000.00, plus (ii) 75% of cumulative consolidated
net income for all fiscal quarters ending after December 31, 2000, in which
such net income was greater than zero, and (iii) the amount by which the
consolidated shareholder's equity has increased or shall increase after
December 31, 2000 solely as a result of the issuance of common or preferred
stock or the conversion of debt securities into such stock, with "Tangible
Net Worth" defined as the aggregate of total stockholders' equity plus
subordinated debt less any intangible assets.

(b)        Maintain
an EBITDA Coverage Ratio of not less than 1.75 to 1.0, determined as of each
fiscal quarter end on a trailing four (4) fiscal quarter basis, with
"EBITDA" defined as net profit before tax plus interest expense (net
of capitalized interest expense), depreciation expense and amortization
expense, and with "EBITDA Coverage Ratio" defined as EBITDA divided
by the aggregate of total interest expense plus the prior period current
maturity of long-term debt, the prior period current maturity of capital leases
and the prior period current maturity of subordinated debt.

(c)         Maintain
a Ratio of Funded Debt to EBITDA, determined as of each fiscal quarter end, not
greater than 2.75 to 1.00 to and including September 30, 2002, and 2.50 to
1.00  thereafter, with "Funded
Debt" defined as the aggregate of all interest bearing obligations,
inclusive of (without duplication) letters of credit, capital leases and
guaranteed indebtedness, and with "EBITDA" as defined above.

(d)        Maintain
a Ratio of unsecured Funded Debt to Asset Coverage, determined as of the end of
each month, not greater than 1.00 to 1.00, with "Funded Debt" as
defined above, and with "Asset Coverage" defined as the aggregate of
(i) seventy-five percent (75%) of Lessee’s and its domestic subsidiaries'
accounts receivable aged to 60 days past due or less, plus (ii) fifty percent
(50%) of the book value of Lessee’s and such domestic subsidiaries' inventory
under contract, and without duplication, of raw materials and finished goods,
plus (iii) 50% of the net book value of Lessee’s and such domestic
subsidiaries' unencumbered real estate located in the United States, plus (iv)
50% of the net book value of Lessee’s and such domestic subsidiaries'
unencumbered machinery and equipment located in the United States.

	 	2.	Accounting terms used herein without
  definition shall be determined in accordance with GAAP.  Within Sixty (60) days after the end of
  each fiscal quarter of Lessee, Lessee will furnish to Lessor a certificate of
  the chief financial officer of Lessee setting forth the computations in
  reasonable detail and satisfactory to Lessor demonstrating compliance with
  each of the covenants contained in paragraph 1 above for the preceding fiscal
  quarter.
	 	 	 
	 	3.	Lessor and Lessee agree that the failure of
  Lessee to comply with any of the covenants set forth in paragraph 1 above
  shall constitute a default under the Lease.
	 	 	 
	 	4.	Except as expressly set forth herein, the
  terms and conditions of the Lease and any Schedule executed and delivered
  pursuant thereto remain unmodified and in full force and effect.  This Amendment is binding upon, and inures
  to the benefit of, the successors and assigns of the parties hereto.

             IN WITNESS WHEREOF, the parties have
caused this Amendment to be executed as of the date first above set forth.

	 	GENERAL ELECTRIC CAPITAL CORPORATION
	 	 
	 	By:	/s/Steven R. DeCarlo

 
	 	Name:	Steven R. DeCarlo

	 	Title:	Transaction & Syndication Manater

	 	 	 
	 	NORTHWEST PIPE COMPANY
	 	 
	 	By:	/s/Brian W. Dunham

	 	Name:	Brian W. Dunham

	 	Title:	Chief Executive Officer

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