Document:

SECURITY AGREEMENT

     THIS SECURITY AGREEMENT (this "Agreement"), dated September 8, 1999, is
made between and among Matlack DE, Inc., Matlack, Inc., Specialized Dedicated
Fleets, Inc., successor by merger to Safeway Chemical Transportation, Inc.,
Brite-Sol Services, Inc., Matlack Leasing, Inc., Super Service, Inc (each
individually and collectively referred to as the "Grantor"), jointly and
severally, and FIRST UNION NATIONAL BANK, a national banking association, as
agent for the Banks (in such capacity, and together with its successors as agent
for the Banks, the "Collateral Agent").

                                    RECITALS

     WHEREAS, Grantor is a party to that certain Credit Agreement dated as of
August 19, 1998 between and among Grantor, the banking institutions signatories
thereto and First Union National Bank, a national banking association, as agent
for the Banks (as amended, restated, modified, renewed, supplemented or extended
from time to time, the "Credit Agreement").

     WHEREAS, pursuant to Section 9.01 of the Credit Agreement, the Banks have
required and Grantor has agreed to grant a security interest as herein provided;

     WHEREAS, the Banks have requested a security interest as permitted under
the Credit Agreement;

     NOW, THEREFORE, for and in consideration of any loan under the Credit
Agreement and any other loan or advance (including any other loan or advance by
renewal or extension) heretofore or hereafter made to Grantor by the Banks, the
parties hereto agree as follows:

SECTION 1. Definitions; Interpretation.

     a.   Terms Defined in Credit Agreement. All capitalized terms used in this
          Agreement and not otherwise defined herein have the meanings specified
          in the Credit Agreement.

     b.   Certain Defined Terms. As used in this Agreement, the following terms
          have the following meanings:

     "Accounts" means any and all accounts of Grantor, whether now existing or
     hereafter acquired or arising, and in any event includes all accounts
     receivable, contract rights, rights to payment and other obligations of any
     kind owed to Grantor arising out of or in connection with the sale or lease
     of merchandise, goods or commodities or the rendering of services or
     arising from any other transaction, however evidenced, and whether or not
     earned by performance, all guaranties, indemnities and security with
     respect to the foregoing, and all letters of credit relating thereto, in
     each case whether now existing or hereafter acquired or arising.

Security Agreement/Accounts          - 1 -                     September 8, 1999

<PAGE>

     "Books" means all books, records and other written, electronic or other
     documentation in whatever form maintained now or hereafter by or for
     Grantor in connection with the ownership of its assets or the conduct of
     its business or evidencing or containing information relating to the
     Collateral, including: (i) ledgers; (ii) records indicating, summarizing,
     or evidencing Grantor's assets (including Inventory and Rights to Payment),
     business operations or financial condition; (iii) computer programs and
     software; (iv) computer discs, tapes, files, manuals, spreadsheets; (v)
     computer printouts and output of whatever kind; (vii) any other computer
     prepared or electronically stored, collected or reported information and
     equipment of an, kind; and (vii) any and all other rights now or hereafter
     arising out of any contract or agreement between Grantor and any service
     bureau, computer or data processing company or other Person charged with
     preparing or maintaining any of Grantor's books or records or with credit
     reporting, including with regard to Grantor's Accounts.

     "Chattel Paper" means all writings of whatever sort which evidence a
     monetary obligation and a security interest in or lease of specific goods,
     whether now existing or hereafter arising.

     "Collateral" has the meaning specified in Section 2.

     "Documents" means any and all documents of title, bills of lading, dock
     warrants, dock receipts, warehouse receipts and other documents of Grantor,
     whether or not negotiable, and includes all other documents which purport
     to be issued by a bailee or agent and purport to cover goods in any
     bailee's or agent's possession which are either identified or are fungible
     portions of an identified mass, including such documents of title made
     available to Grantor for the purpose of ultimate sale or exchange of goods
     or for the purpose of loading, unloading, storing, shipping, transshipping,
     manufacturing, processing or otherwise dealing with goods in a manner
     preliminary to their sale or exchange, in each case whether now existing or
     hereafter acquired or arising.

     "Financing Statements" has the meaning specified in Section 3.

     "Lender Party" means, as the context may require, any Bank or the
     Collateral Agent and each of their respective successors, transferees and
     assigns.

     "Proceeds" means whatever is receivable or received from or upon the sale,
     lease, license, collection, use, exchange or other disposition, whether
     voluntary or involuntary, of any Collateral or other assets of Grantor,
     including "proceeds" as defined at UCC Section 9306, any and all proceeds
     of any insurance, indemnity, warranty or guaranty payable to or for the
     account of Grantor from time to time with respect to any of the Collateral,
     any and all payments in any form whatsoever) made or due and payable to
     Grantor from time to time in connection with any requisition, confiscation,
     condemnation, seizure or forfeiture of all or any part of the Collateral by
     any Governmental Authority (or any person acting under color of
     Governmental Authority), any and all other amounts from time to time paid
     or payable under or in connection with any of the Collateral or for or on
     account of any damage or injury

Security Agreement/Accounts          - 2 -                     September 8, 1999

<PAGE>

     to or conversion of any Collateral by any Person, any and all other
     tangible or intangible property received upon the sale or disposition of
     Collateral, and all proceeds of proceeds.

     "Rights to Payment" means all Accounts, and any and all rights and claims
     to the payment or receipt of money or other forms of consideration of any
     kind in, to and under all Chattel Paper, Documents, Instruments and
     Proceeds.

     "Secured Obligations" means all Obligations of Grantor under or in
     connection with the Credit Agreements and each other Loan Document to which
     Grantor is or may become a party, whether for principal, interest, costs,
     fees, expenses, indemnities or otherwise and all obligations of Grantor
     existing under this Security Agreement and each other Loan Document to
     which it is or may become a party, in each case whether now existing or
     hereafter arising, and whether due or to become due, absolute or
     contingent, liquidated or unliquidated, determined or undetermined.

     "UCC" means the Uniform Commercial Code as the same may from time to time,
     be in effect in the Commonwealth of Pennsylvania; provided, however, in the
     event that, by reason of mandatory provisions of law, any or all of the
     attachment, perfection or priority of the security interest in any
     Collateral is governed by the Uniform Commercial Code as in effect in a
     jurisdiction other than the Commonwealth of Pennsylvania, the term "UCC"
     shall mean the Uniform Commercial Code as in effect In such other
     jurisdiction for purposes of the provisions hereof relating to such
     attachment, perfection or priority and for purposes of definitions related
     to such provisions.

     c.   Terms Defined in UCC. Where applicable and except as otherwise defined
          herein, terms used in this Agreement shall have the meanings assigned
          to them in the UCC.

SECTION 2. Security Interest.

     a.   Grant of Security Interest. As security for the payment and
          performance of the Secured Obligations, each Grantor hereby pledges,
          assigns, transfers, hypothecates and sets over to the Collateral Agent
          for its benefit and for the ratable benefit of the Lending Parties,
          and hereby grants to the Collateral Agent for its benefit and for the
          ratable benefit of the Banks, a security interest in, all of Grantor's
          right, title and interest in, to and under the following property,
          wherever located and whether now existing or owned or hereafter
          acquired or arising collectively, the "Collateral"): (i) all
          Accounts; (ii) all Chattel Paper; (iii) all Documents; (iv) all
          Books; and (v) all products and Proceeds of any and all of the
          foregoing.

     b.   Grantor Remains Liable. Anything herein to the contrary
          notwithstanding, (i) Grantor shall remain liable under any contracts,
          agreements and other documents included in the Collateral, to the
          extent set forth therein, to perform all of its duties and obligations
          thereunder to the same extent as if this Agreement had not been
          executed, (ii) the exercise by the Collateral Agent of any of the
          rights hereunder shall

Security Agreement/Accounts          - 3 -                     September 8, 1999

<PAGE>

          not release Grantor from any of its duties or obligations under such
          contracts, agreements and other documents included in the Collateral,
          and (iii) neither the Collateral Agent nor any other Lender Party
          shall have any obligation or liability under any contracts, agreements
          and other documents included in the Collateral by reason of this
          Agreement, nor shall the Collateral Agent or any other Lender Party be
          obligated to perform any of the obligations or duties of Grantor
          thereunder or to take an, action to collect or enforce any such
          contract, agreement or other document included in the Collateral
          hereunder.

     c.   Continuing Security Interest. Grantor agrees that this Agreement shall
          create a continuing security interest in the Collateral which shall
          remain in effect until terminated in accordance with this Agreement.

SECTION 3. Financing Statements, Etc.

Grantor shall execute and deliver to the Collateral Agent concurrently with the
execution of this Agreement, and at any time and from time to time thereafter,
all financing statements, continuation financing statements, termination
statements, security agreements, chattel mortgages, assignments, and all other
documents and instruments relating to Accounts, in form satisfactory to the
Collateral Agent (the "Financing Statements"), and take all other action, as the
Collateral Agent may reasonably request, to perfect and continue perfected,
maintain the priority of or provide notice of the Collateral Agent's security
interest in the Collateral and to accomplish the purposes of this Agreement.

SECTION 4. Representations and Warranties. In addition to the representations
and warranties of Grantor set forth in the Credit Agreement, which are
incorporated herein by this reference, Grantor represents and warrants to the
Collateral Agent that:

     a.   Location of Chief Executive Office and Collateral. Each of Grantor's
          chief executive office and principal place of business is located at
          Wilmington, Delaware, and all other locations where Grantor conducts
          business is controlled from Wilmington, Delaware.

     b.   Locations of Books. All locations where Books pertaining to the Rights
          to Payment are kept, including all equipment necessary for accessing
          such Books and the names and addresses of all service bureaus,
          computer or data processing companies and other Persons keeping any
          Books or collecting Rights to Payment: for Grantor, are only in
          Wilmington, Delaware.

     c.   Ownership of Collateral. Grantor is, and, permitted by Section 5(i),
          will continue to be, the sole and complete owner of the Collateral
          (or, in the case of after-acquired Collateral, at the time Grantor
          acquires rights in such Collateral, will be the sole and complete
          owner thereof), free from any Lien other than Permitted Liens.

Security Agreement/Accounts          - 4 -                     September 8, 1999

<PAGE>

     d.   Enforceability; Priority of Security Interest. (i) This Agreement
          creates a security interest which is enforceable against the
          Collateral in which Grantor now has rights and will create a security
          interest which is enforceable against the Collateral in which Grantor
          hereafter acquires rights at the time Grantor acquires any such
          rights; and (ii) the Collateral Agent has a perfected and first
          priority security interest in the Collateral, in which Grantor now has
          rights, and will have a perfected and first priority security interest
          in the Collateral in which Grantor hereafter acquires rights at the
          time Grantor acquires any such rights, in each case for the Collateral
          Agent's own benefit and for the ratable benefit of the other Lender
          Parties, and in each case securing the payment and performance of the
          Secured Obligations.

     e.   Other Financing Statements. Other than (i) financing statements or
          similar filings naming the owner of the asset to which such lien
          relates as debtor, under the UCC or any comparable law ("UCC Financing
          Statements") disclosed to the Collateral Agent and (ii) UCC Financing
          Statements in favor of the Collateral Agent in its capacity as
          Collateral Agent for the other Lender Parties under the Credit
          Agreements and any other Loan Documents, no effective UCC Financing
          Statement naming Grantor as debtor, assignor, grantor, mortgagor,
          pledgor or the like and covering all or any part of the Collateral is
          on file in any filing or recording office in any jurisdiction.

     f.   Rights to Payment. The Rights to Payment represent valid, binding and
          enforceable obligations of the account debtors or other Persons
          obligated thereon, representing undisputed, bona fide transactions
          completed in accordance with the terms and provisions contained in any
          documents related thereto, and are and will be genuine, free from
          Liens, and not subject to any adverse claims, counterclaims, setoffs,
          defaults, disputes, defenses, discounts, retainages, holdbacks or
          conditions precedent of any kind of character, except to the extent
          reflected by Grantor's reserves for uncollectible Rights to Payment or
          to the extent, if any, that such account debtors or other Persons may
          be entitled to normal and ordinary course trade discounts, returns,
          adjustments and allowances in accordance with Section 5(m), or as
          otherwise disclosed to the Collateral Agent in writing;

          i.   to Grantor's knowledge, all account debtors and other obligors on
               the Rights to Payment are solvent and generally paying their
               debts as they come due except to the extent that Grantor has
               established adequate reserves therefor in accordance with GAAP;

          ii.  to Grantor's knowledge, all Rights to Payment comply in all
               material respects with all applicable laws concerning form,
               content and manner of preparation and execution, including where
               applicable any federal or state consumer credit laws;

Security Agreement/Accounts          - 5 -                     September 8, 1999

<PAGE>

          iii. Grantor has not assigned any of its rights under the Rights to
               Payment except as provided in this Agreement or as set forth in
               the other Loan Documents;

          iv.  with respect to the Rights to Payment constituting Eligible
               Receivables, except as disclosed in writing to the Collateral
               Agent, Grantor has no knowledge that any of the criteria for
               eligibility are not or are no longer satisfied;

          v.   all statements made, all unpaid balances and all other
               information in the Books and other documentation relating to the
               Rights to Payment are true and correct and in all material
               respects what they purport to be; and

          vi.  Grantor has no knowledge of any fact or circumstance which would
               materially impair the validity or collectibility of any of the
               Rights to Payment.

     g.   Corporate Existence and Power. Grantor (i) is a corporation duly
          organized, validly existing and in good standing under the laws of the
          jurisdiction of its incorporation; (ii) has the power and authority
          and all governmental licenses, authorizations, consents and approvals
          to own its assets, carry on its business and to execute, deliver, and
          perform its obligations under the Agreement and any other Loan
          Document to which it is a party; (iii) is duly qualified as a foreign
          corporation and is licensed and in good standing under the laws of
          each jurisdiction where its ownership, lease or operation of property
          or the conduct of its business requires such qualification or license;
          (iv) is in compliance with all Requirements of Law; except, in each
          case referred to in clause (iii) or clause (iv), to the extent that
          the failure to do so could not reasonably be expected to have a
          Material Adverse Effect.

     h.   Corporate Authorization; No Contravention. The execution, delivery and
          performance by Grantor of this Agreement and each other Loan Document
          to which it is a party, have been duly authorized by all necessary
          corporate action, and do not and will not: (i) contravene the terms of
          any of Grantor's Organization Documents; (ii) conflict with or result
          in any breach or contravention of, or the creation of any Lien under,
          any document evidencing any Contractual Obligation to which Grantor is
          a party cr any order, injunction, writ or decree of any Governmental
          Authority to which Grantor or its property is subject; or (iii)
          violate any Requirement of Law.

     i.   Governmental Authorization. No approval, consent, exemption,
          authorization, or other action by, or notice to, or filing with, any
          Governmental Authority is necessary or required in connection with the
          execution, delivery or performance by, or enforcement against, Grantor
          of this Agreement or any other Loan Document to which it is a party.

SECTION 5. Covenants. In addition to the covenants of Grantor set forth in the
Credit Agreements, which are incorporated herein by this reference, so long as
any of the Secured

Security Agreement/Accounts          - 6 -                     September 8, 1999

<PAGE>

Obligations remain unsatisfied or any Bank shall have any Commitment or any
Letter of Credit shall be outstanding, Grantor agrees that:

     a.   Defense of Collateral. Grantor will appear in and defend any action,
          suit or proceeding which may affect to a material extent its title to,
          or right or interest in, or the Collateral Agent's right to or
          interest in, the Collateral.

     b.   Preservation of Collateral. Grantor will do and perform all reasonable
          acts that may be necessary and appropriate to maintain, preserve and
          protect the Collateral.

     c.   Compliance with Laws, Etc. Grantor will comply in all material
          respects with all laws, regulations and ordinances, and all policies
          of insurance, relating in a material way to the possession, operation,
          maintenance and control of the Collateral.

     d.   Location of Books and Chief Executive Office. Grantor will: (i) keep
          all Books pertaining to the Rights to Payment at the locations
          described in Section 4; and (ii) give at least 30 days' prior written
          notice to the Collateral Agent of (A) any changes in any such location
          where Books pertaining to the Rights to Payment are kept, including
          any change of name or address of any service bureau, computer or data
          processing company or other Person. preparing or maintaining any Books
          or collecting Rights to Payment for Grantor or (B) any changes in the
          location of Grantor's chief executive office or principal place of
          business.

     e.   Location of Collateral. Grantor will: (i) keep the Collateral at the
          location described in Section 4 and not remove the Collateral from
          such locations (other than disposals of Collateral permitted by
          subsection (ii) except upon at least 30 days' prior written notice of
          any removal to the Collateral Agent; and (iii) give the Collateral
          Agent at least 30 days' prior written notice of any change in the
          locations set forth above.

     f.   Change in Name, Identity or Structure. Grantor will give at least 30
          days' prior written notice of (i) any change in name, (ii) any changes
          in, additions to or other modifications of its trade names and trade
          styles set forth in Schedule 1, and (iii) any changes in its identity
          or structure in any manner which might make any Financing Statement
          filed hereunder incorrect or misleading.

     g.   Maintenance of Records. Grantor will keep separate, accurate and
          complete Books with respect to the Collateral, disclosing the
          Collateral Agent's security interest hereunder.

     h.   Invoicing of Sales. Grantor will invoice all of its sales upon forms
          customary in the industry and to maintain proof of delivery and
          customer acceptance of goods.

     i.   Disposition of Collateral. Grantor will not surrender or lose
          possession of (other than to the Collateral Agent), sell, lease, rent,
          or otherwise dispose of or transfer any of

Security Agreement/Accounts          - 7 -                     September 8, 1999

<PAGE>

          the Collateral or any right or interest therein, except to the extent
          permitted by the Credit Agreement.

     j.   Liens. Other than liens in favor of the Collateral Agent in its
          capacity as Collateral Agent under the Credit Agreement and Permitted
          Liens, Grantor will keep the Collateral free of all liens and security
          interests of any kind.

     k.   Expenses. Grantor will pay all expenses of protecting, storing,
          warehousing, insuring, handling and shipping the Collateral.

     l.   Rights to Payment. Grantor will:

          i.   with such frequency as the Collateral Agent may reasonably
               require, furnish to the Collateral Agent (A) master customer
               listings, including all names and addresses, together with copies
               or originals (as requested by the Collateral Agent) of documents,
               customer statements, repayment histories and present status
               reports relating to the Accounts; (3) accurate records and
               summaries of Accounts, including detailed agings specifying the
               name, face value and date of each invoice, and listings of
               Accounts that are disputed or have been canceled; and (C) such
               other matters and information relating to the Accounts as the
               Collateral Agent shall from time to time reasonably request;

          ii.  give only normal discounts, allowances and credits as to Accounts
               and other Rights to Payment, in the ordinary course of business,
               according to normal trade practices utilized by Grantor in the
               past, and enforce all Accounts and other Rights to Payment
               strictly in accordance with their terms, and take all such action
               to such end as may from time to time be reasonably requested by
               the Collateral Agent, except that Grantor may grant any extension
               of the time for payment;

          iii. if any discount, allowance, credit, extension of time for
               payment, agreement to make a rebate or otherwise to reduce the
               amount owing on, or compromise or settle, an Account or other
               Right to Payment exists or occurs, or if, to the knowledge of
               Grantor, any dispute, setoff, claim, counterclaim or defense
               exists or has been asserted or threatened with respect to an
               Account or other Right to Payment, disclose such fact fully to
               the Collateral Agent in the Books relating to such Account or
               other Right to Payment and in connection with any invoice or
               report furnished by Grantor to the Collateral Agent relating to
               such Account or other Right to Payment;

          iv.  if any Accounts arise from contracts with the United States or
               any department, agency or instrumentality thereof, immediately
               notify the Collateral Agent thereof and execute any documents and
               instruments and take any other steps requested by the Collateral
               Agent in order that all monies due

Security Agreement/Accounts          - 8 -                     September 8, 1999

<PAGE>

               and to become due thereunder shall be assigned to the Collateral
               Agent and notice thereof given to the Government Authorities
               under the Federal Assignment of Claims Act;

          v.   in accordance with its sound business judgment perform and comply
               in all material respects with its obligations in respect of the
               Accounts and other Rights to Payment;

          vi.  upon the request of the Collateral Agent (A) upon the occurrence
               of an Event of Default, notify all or any designated portion of
               the account debtors and other obligors on the Rights to Payment
               of the security interest hereunder, and (B) upon the occurrence
               of an Event of Default, notify the account debtors and other
               obligors on the Rights to Payment or an, designated portion
               thereof that payment shall be made directly to the Collateral
               Agent or to such other Person or location as the Collateral Agent
               shall specify; and

          vii. upon the occurrence of any Event of Default, establish such
               lockbox or similar arrangements for the payment of the Accounts
               and other Rights to Payment as the Collateral Agent shall
               require.

     m.   Documents, Etc. Upon the request of the Collateral Agent, Grantor will
          (i) immediately deliver to the Collateral Agent, or an agent
          designated by it, appropriately endorsed or accompanied by appropriate
          instruments of transfer or assignment, all Documents, Instruments and
          Chattel Paper, and all other Rights to Payment at any time evidenced
          by promissory notes, trade acceptances or other instruments, and (ii)
          mark all Documents and Chattel Paper with such legends as the
          Collateral Agent shall reasonably specify.

     n.   Notices, Reports and Information. Grantor will (i) notify the
          Collateral Agent of any material claim made or asserted against the
          Collateral by any Person and of any change in the composition of the
          Collateral or other event which could materially adversely affect the
          value of the Collateral or the Collateral Agent's Lien thereon; (ii)
          furnish to the Collateral Agent such statements and schedules further
          identifying and describing the Collateral and such other reports and
          other information in connection with the Collateral as the Collateral
          Agent may reasonably request, all in reasonable detail; and (iii) upon
          request of the Collateral Agent make such demands and requests for
          information and reports as Grantor is entitled to make in respect of
          the Collateral.

SECTION 6. Collection of Rights to Payment.

Until the Collateral Agent exercises its rights hereunder to collect Rights to
Payment, Grantor shall endeavor in the first instance diligently to collect all
amounts due or to become due on or with respect to the Rights to Payment. At the
request of the Collateral Agent, upon and after the occurrence of any Event of
Default, all remittances received by :he Grantor shall be held in trust for

Security Agreement/Accounts          - 9 -                     September 8, 1999

<PAGE>

the Collateral Agent and, in accordance with the Collateral Agent's
instructions, remitted to the Collateral Agent or deposited to an account with
the Collateral Agent in the form received (with any necessary endorsements or
instruments of assignment or transfer).

SECTION 7. Authorization; Collateral Agent Appointed Attorney-in-Fact. The
Collateral Agent shall have the right to, in the name of Grantor, or in the name
of the Collateral Agent or otherwise, without notice to or assent by Grantor,
and Grantor hereby constitutes and appoints the Collateral Agent (and any of the
Collateral Agent's officers, employees or agents designated by the Collateral
Agent) as Grantor's true and lawful attorney-in-fact, with full power and
authority to:

     a.   sign any of the Financing Statements which must be executed or filed
          to perfect or continue perfected, maintain the priority of or provide
          notice of the collateral Agent's security interest in the Collateral;

     b.   take possession of and endorse any notes, acceptances, checks, drafts,
          money orders or other forms of payment or security and collect any
          Proceeds of any Collateral;

     c.   sign and endorse any invoice or bill of lading relating to any of the
          Collateral, warehouse or storage receipts, drafts against customers or
          other obligors, assignments, notices of assignment, verifications and
          notices to customers or other obligors;

     d.   notify the Postal Service authorities to change the address for
          delivery of mail addressed to Grantor to such address as the
          Collateral Agent may designate and, without limiting the generality of
          the foregoing, establish with any Person lockbox or similar
          arrangements for the payment of the Rights to Payment;

     e.   receive, open and dispose of all mail addressed to Grantor;

     f.   send requests for verification of Rights to Payment to the customers
          or other obligors of Grantor;

     g.   contact, or direct Grantor to contact, all account debtors and other
          obligors on the Rights to Payment and instruct such account debtors
          and other obligors to make all payments directly to the Collateral
          Agent;

     h.   exercise dominion and control over, and refuse to permit further
          withdrawals from, Deposit Accounts maintained with the Collateral
          Agent;

     i.   notify each Person maintaining lockbox or similar arrangements for the
          payment of the Rights to Payment to remit all amounts representing
          collections on the Rights to Payment directly to the Collateral Agent;

Security Agreement/Accounts          - 10 -                    September 8, 1999

<PAGE>

     j.   ask, demand, collect, receive and give acquittances and receipts for
          any and all Rights to Payment, enforce payment or any other rights in
          respect of the Rights to Payment and other Collateral, grant consents,
          agree to any amendments, modifications or waivers of the agreements
          and documents governing the Rights to Payment and other Collateral,
          and otherwise file any claims, take any action or institute, defend,
          settle or adjust any actions, suits or proceedings with respect to the
          Collateral, as the Collateral Agent may deem necessary or desirable to
          maintain, preserve and protect the Collateral, to collect the
          Collateral or to enforce the rights of the Collateral Agent with
          respect to the Collateral;

     k.   execute any and all endorsements, assignments or other documents and
          instruments necessary to sell, lease, assign, convey or otherwise
          transfer title in or dispose of the Collateral; and

     l.   execute any and all such other documents and instruments, and do any
          and all acts and things for and on behalf of Grantor, which the
          Collateral Agent may deem necessary or advisable to maintain, protect,
          realized upon and preserve the Collateral and the Collateral Agent's
          security interest therein and to accomplish the purposes of this
          Agreement.

The Collateral Agent agrees that, except upon and after the occurrence of an
Event of Default, it shall not exercise the power of attorney, or any rights
granted to the Collateral Agent, pursuant to the foregoing subclauses. The
foregoing power of attorney is coupled with an interest and irrevocable so long
as any Bank has any Commitment or any Letter of Credit remains outstanding or
the Secured Obligations have not been paid and performed in full. Grantor hereby
ratifies, to the extent permitted by law, all that the Collateral Agent shall
lawfully and in good faith do or cause to be done by virtue of and in compliance
with this Section 7.

SECTION 8. Collateral Agent's Duties.

Notwithstanding any provision contained in this Agreement, the Collateral Agent
shall have no duty to exercise any of the rights, privileges or powers afforded
to it and shall not be responsible to Grantor or any other Person for any
failure to do so or delay in doing so. Beyond the exercise of reasonable care to
assure the safe custody of Collateral in the Collateral Agent's possession and
the accounting for moneys actually received by the Collateral Agent hereunder,
the Collateral Agent shall have no duty or liability to exercise or preserve any
rights, privileges or powers pertaining to the Collateral.

SECTION 9. Remedies.

     a.   Remedies. Upon the occurrence of any Event of Default, the Collateral
          Agent shall have, in addition to all other rights and remedies granted
          to it in this Agreement, the Credit, Agreement or any other Loan
          Document, all rights and remedies of a secured

Security Agreement/Accounts          - 11 -                    September 8, 1999

<PAGE>

          party under the UCC and other applicable laws. without limiting the
          generality of the foregoing, Grantor agrees that the Collateral Agent
          may:

          i.   peaceably and without notice enter any premises of Grantor, take
               possession of any the Collateral, remove or dispose of all or
               part of the Collateral on any premises or elsewhere, or, in the
               case of Equipment, render it nonfunctional, and otherwise
               collect, receive, appropriate and realize upon all or any part of
               the Collateral, and demand, give receipt for, settle, renew,
               extend, exchange, compromise, adjust, or sue for all or any part
               of the Collateral, as the Collateral Agent may determine;

          ii.  require Grantor to assemble all or any part of the Collateral and
               make it available to the Collateral Agent at any place and time
               designated by the Collateral Agent;

          iii. secure the appointment of a receiver of the Collateral or any
               part thereof to the extent and in the manner provided by
               applicable law;

          iv.  withdraw (or cause to be withdrawn) any and all funds from
               Deposit Accounts; and

          v.   sell, resell, lease, use, assign, transfer or otherwise dispose
               of any or all of the Collateral in its then condition or
               following any commercially reasonable preparation or processing
               (utilizing in connection therewith any of Grantor's; assets,
               without charge or liability to the Collateral Agent therefor) at
               public or private sale, by one or more contracts, in one or more
               parcels, at the same or different times, for cash or credit, or
               for future delivery without assumption of any credit risk, all as
               the Collateral Agent deems advisable; provided, however, that
               Grantor shall be credited with the net proceeds of sale only when
               such proceeds are finally collected by the Collateral Agent. The
               Collateral Agent shall have the right upon any such public sale,
               and, to the extent permitted by law, upon any such private sale,
               to purchase the whole or any part of the Collateral so sold, free
               of any right or equity of redemption, which right or equity of
               redemption Grantor hereby releases, to the extent permitted by
               law. Grantor hereby agrees that the sending of notice by ordinary
               mail, postage prepaid, to the address of Grantor set forth in the
               Credit Agreement, of the place and time of any public sale or of
               the time after which any private sale or other intended
               disposition is to be made, shall be deemed reasonable notice
               thereof if such notice is sent ten days prior to the date of such
               sale or other disposition or the date on or after which such sale
               or other disposition may occur, provided that the Collateral
               Agent may provide Grantor shorter notice or no notice, to the
               extent permitted by the UCC or other applicable law.

Security Agreement/Accounts          - 12 -                    September 8, 1999

<PAGE>

     b.   Proceeds Account. To the extent that any of the Secured Obligations
          may be contingent, unmatured or unliquidated (including with respect
          to undrawn amounts under any Letter of Credit) at such time as there
          may exist an Event of Default, the Collateral Agent may, at its
          election, (i) retain the proceeds of any sale, collection, disposition
          or other realization upon the Collateral (or any portion thereof) in a
          special purpose non-interest-bearing restricted deposit account (the
          "Proceeds Account") created and maintained by the Collateral Agent for
          such purpose (which shall constitute a Deposit Account included within
          the Collateral hereunder) until such time as the Collateral Agent may
          elect to apply such proceeds to the Secured Obligations, and Grantor
          agrees that such retention of such proceeds by the Collateral Agent
          shall not be deemed strict foreclosure with respect thereto; (ii) in
          any manner elected by the Collateral Agent, estimate the liquidated
          amount of any such contingent, unmatured or unliquidated claims and
          apply the proceeds of the Collateral against such amount; or (iii)
          otherwise proceed in any manner permitted by applicable law. Grantor
          agrees that the Proceeds Account shall be a blocked account and that
          upon the irrevocable deposit of funds into the Proceeds Account,
          Grantor shall not have any right of withdrawal with respect to such
          funds. Accordingly, Grantor irrevocably waives until the termination
          of the security interests granted under this Agreement in accordance
          with this Agreement the right to make any withdrawal from the Proceeds
          Account and the right to instruct the Collateral Agent to honor drafts
          against the Proceeds Account.

     c.   Application of Proceeds. Subject to subsection (b) immediately above,
          the cash proceeds actually received from the sale or other disposition
          or collection of Collateral, and any other amounts received in respect
          of the Collateral the application of which is not otherwise provided
          for herein, shall be applied (after payment of any amounts payable to
          the Collateral Agent pursuant to Section 8 or Section 14 in whole or
          in part by the Collateral Agent for the benefit of the Lender Parties
          against all or any part of the Secured Obligations in the following
          order: (i) first, to any fees, costs, or other expenses due under the
          Loan Documents; (ii) next, to any interest (iii) next, to any
          principal due under the Loan Documents; and (iii) last, to any other
          Secured Obligations. Any surplus thereof which exists after payment
          and performance in full of the Secured Obligations shall be promptly
          paid over to Grantor or otherwise disposed of in accordance with the
          UCC or other applicable law. Grantor shall remain liable to the
          Collateral Agent for any deficiency which exists after any sale or
          other disposition or collection of Collateral.

SECTION 10. Certain Waivers.

Grantor waives, to the fullest extent permitted by law, (i) any right of
redemption with respect to the Collateral, whether before or after sale
hereunder, and all rights, if any, of marshaling of the Collateral or other
collateral or security for the Secured Obligations; (ii) any right to require
the Collateral Agent (A) to proceed against any Person, (B) to exhaust any other
collateral or security for any of the Secured Obligations, (C) to pursue any
remedy in the Collateral Agent's power, or

Security Agreement/Accounts          - 13 -                    September 8, 1999

<PAGE>

(D) to make or give any presentments, demands for performance, notices of
nonperformance, protests, notices of protests or notices of dishonor in
connection with any of the Collateral; and (iii) all claims, damages, and
demands against the Collateral Agent arising out of the repossession, retention,
sale or application of the proceeds of any sale of the Collateral.

SECTION 11. Certain Additional Consents and Waivers. This Agreement is absolute,
unconditional and irrevocable and is in no way conditioned or contingent on
Grantor's performance of any obligation under the Credit Agreement or any other
Loan Document, any attempt to enforce in whole or in part any of the Grantor's
liabilities and obligations to any Lender Party or the existence or continuance
of Grantor or any other Person as a legal entity, nor shall this Agreement or
Grantor's obligations hereunder be limited, impaired, restricted or otherwise
affected by the consolidation or merger of Grantor with or into any other
entity, the sale, lease or other disposition by Grantor of all or substantially
all of its assets to any other entity (whether or not effected in compliance
with the Loan Documents), or the bankruptcy, or insolvency of Grantor, the
admission in writing by Grantor of its inability to pay its debts as they
mature, or its making of a general assignment for the benefit of, or entering
into a composition or arrangement with, creditors.

     a.   The Collateral Agent and the other Lender Parties may, at any time and
          from time to time, without the consent of or notice to Grantor, except
          such notice as may be required by applicable statute which cannot be
          waived, without incurring responsibility to Grantor, and without
          impairing or releasing the obligations of Grantor hereunder, upon or
          without any terms or Conditions and in whole or in part, (i) to the
          extent permitted by the Credit Agreement, change the manner, place and
          terms of payment or change or extend the time of payment of, renew or
          alter any obligation of Grantor hereby secured, or in any manner
          modify, amend or supplement the terms of the Credit Agreement, or
          other Credit Documents (other than this Agreement) or any documents,
          instruments or agreements executed in connection therewith (other than
          this Agreement), and this Agreement shall apply to the obligations and
          liabilities of Grantor, as changed, extended, renewed, modified,
          amended, supplemented or altered in any manner, (ii) exercise or
          refrain from exercising any rights against Grantor or others
          (including Grantor) or otherwise act or refrain from acting,
          (iii) settle or compromise any obligations and liabilities herein
          secured or any obligations and liabilities (including any of those
          hereunder) incurred directly or indirectly in respect thereof or
          hereof and may subordinate the payment of all or any part thereof to
          the payment of any obligations and liabilities which may be due
          Collateral Agent, the other Lender Parties or others, (iv) sell,
          exchange, release, surrender, realize upon or otherwise deal with in
          any manner or in any order any property pledged or mortgaged by anyone
          to secure or in any manner securing the Secured Obligations, any
          liabilities or obligation (including any of those hereunder) incurred
          directly or indirectly in respect thereof or hereof or any other
          obligations or liabilities of Grantor to the Lender Parties or any
          offset thereagainst, (v) take and hold security or additional security
          for any or all of the Secured Obligations, (vi) apply any sums by
          whomsoever paid or howsoever realized to any obligations and
          liabilities of Grantor to the Lender Parties regardless of what

Security Agreement/Accounts          - 14 -                    September 8, 1999

<PAGE>

          obligations and liabilities remain unpaid, and (vii) in accordance
          with the Credit Agreement, assign their rights and interests under
          this Agreement, the Credit Agreement or the other Loan Documents, in
          whole or in part. Without limiting the generality of the foregoing,
          Grantor hereby specifically waives Grantor's rights and benefits under
          any statute, regulation, judicial decision or other law which purports
          to exonerate or reduce the liability of a surety if the underlying
          obligation is altered in any respect or if the rights and remedies of
          the creditor against the principal in respect of a secured obligation
          are in any way altered, impaired or suspended and agrees that, by so
          doing, Grantor's obligations hereunder shall continue even if the
          Lender Parties alter any obligations under the Credit Agreement or the
          other Loan Documents (other than this Agreement) in any respect or the
          Lender Parties' remedies or rights against Grantor are in any way
          impaired or suspended without Grantor's consent.

     b.   No invalidity, irregularity or unenforceability of the obligations or
          liabilities of Grantor under the Credit Agreement or any other Loan
          Document shall affect, impair or be a defense to this Agreement.
          Grantor hereby waives any and all benefits and defenses under any
          statute, regulation, judicial decision or other law which purports to
          exonerate or reduce the liability of a surety as a result of any
          disability or absence of liability of the principal or any defense to
          liability or enforcement which the principal may have and agrees that,
          by so doing, Grantor's obligations and the security interests granted
          hereunder shall continue even if Grantor had no liability at the time
          of execution of the Credit Agreement or thereafter ceased or cease to
          be liable. Grantor also waives any and all benefits and defenses under
          any statute, regulation, judicial decision or other law which purports
          to limit the liability of a surety to that of the principal or to
          reduce the liability of a surety in proportion to any reduction in the
          liability of the principal and agrees that, by so doing, Grantor's
          obligations hereunder may be more burdensome than that of Grantor.

     c.   Grantor, to the extent permitted under applicable law, hereby waives
          any right, whether arising under any statute, regulation, judicial
          decision or otherwise, to require the Collateral Agent or any other
          Lender Party to (i) proceed against Grantor or any other Person acting
          as surety, guaranteeing or providing collateral or other credit
          support for Grantor's obligations under the Credit Agreement or any
          other Loan Document (a "Third Party Credit Support Provider"), (ii)
          proceed against or exhaust any security received from Grantor or any
          Third Party Credit Support Provider, or (iii) pursue any other right
          or remedy in the Collateral Agent's or the other Lender Parties, Power
          whatsoever.

     d.   Grantor further waives, to the extent permitted under applicable law:
          (i) any defense resulting from the absence, impairment or loss of any
          right of reimbursement, subrogation, contribution or other right or
          remedy of Grantor against Grantor, any Third Party Credit Support
          Provider or any security, whether resulting from an election by the
          Collateral Agent and the other Lender Parties to foreclose upon

Security Agreement/Accounts          - 15 -                    September 8, 1999

<PAGE>

          security by judicial or nonjudicial sale or otherwise; (ii) any setoff
          or counterclaim of Grantor or any defense of any kind (including
          defenses resulting from any disability) or the cessation or stay of
          enforcement from any cause whatsoever of the liability of Grantor
          (including without limitation the lack of validity or enforceability
          of the Credit Agreement or any other Loan Document); (iii) any right
          to exoneration, in whole or in part, of sureties or Third Party Credit
          Support Providers which would otherwise be applicable; (iv) any right
          of subrogation or reimbursement, any right of contribution, any right
          to enforce any remedy which the Collateral Agent and the other Lender
          Parties now have or may hereafter have against Grantor, and any
          benefit of, and any right to participate in, any security now or
          hereafter held or received by the Lender Parties (or the Collateral
          Agent on their behalf); (v) except as required under the Credit
          Agreement, all presentments, demands for performance, notices of
          non-performance, protests, notice of dishonor, notices of acceptance
          of this Agreement or of the existence, creation or incurring of new or
          additional obligations under the Credit Agreement or the other loan
          Documents, or any other notices of any kind; and (vi) all valuation,
          appraisal, extension or redemption laws now or hereafter in effect.
          Without limiting the generality of the preceding clause (iv), Grantor
          hereby waives any right to be reimbursed by Grantor or any Third Party
          Credit Support Provider for any payment of such obligations made
          directly or indirectly by Grantor or from any property of Grantor,
          whether arising by way of any statutory, contractual or other right of
          subrogation, contribution, indemnification or otherwise.

     e.   Grantor further specifically waives any and all benefits, rights and
          defenses (i) arising out of an election of remedies by the Collateral
          Agent or any other Lender Party even though that election of remedies,
          such as a nonjudicial foreclosure with respect to security for the
          Secured Obligations, has destroyed Grantor's rights of subrogation and
          reimbursement against Grantor by operation of applicable law, and all
          rights or defenses Grantor may have by reason of protection afforded
          to Grantor with respect to the Secured Obligations pursuant to the
          antideficiency laws or other laws of the State of Illinois (or other
          applicable jurisdiction) limiting or discharging the Secured
          Obligations.

     f.   Grantor acknowledges that it has the ability, and hereby assumes the
          obligation and responsibility, to keep informed of the financial
          condition of Grantor and any Third Party Credit Support Provider and
          of other matters or circumstances affecting the ability of any of them
          to pay or perform their respective obligations thereunder or the risk
          of nonpayment and nonperformance. Grantor hereby waives any obligation
          on the part of the Collateral Agent or any other Lender Party to
          inform Grantor of the financial condition, or any changes in financial
          condition, of Grantor or any Third Party Credit Support Provider or of
          any other matter or circumstance which might effect the ability of
          Grantor to pay and perform under the Credit Agreement or any or-her
          Loan Document, or the risk of nonpayment or nonperformance.

Security Agreement/Accounts          - 16 -                    September 8, 1999

<PAGE>

SECTION 12. Notices.

All notices or other communications hereunder shall be given in the manner and
to the addresses specified in the Credit Agreement or, in the case of Grantor,
at the address set forth below its signature hereto. All such notices and other
communications shall be effective (i) if delivered by hand or pre-paid courier
service, when delivered; (ii) if sent by mail, upon the earlier of the date of
receipt or five Business Days after deposit in the mail, first class, postage
prepaid; (iii) if sent by telex, upon receipt by the sender of an appropriate
answerback; and (iv) if sent by facsimile transmission, when sent by facsimile
transmission, when sent.

SECTION 13. No Waiver; Cumulative Remedies.

No failure on the part of the Collateral Agent to exercise, and no delay in
exercising, any right, remedy, power or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
remedy, power or privilege preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights and remedies
under this Agreement are cumulative and not exclusive of any rights, remedies,
powers and privileges that may otherwise be available to the Collateral Agent.

SECTION 14. Costs and Expenses; Indemnification; Other Charges.

     a.   Costs and Expenses. Grantor agrees to pay on demand:

          i.   all title, appraisal including the allocated costs of internal
               appraisal services), survey, audit, consulting, search,
               recording, filing and similar costs, fees and expenses incurred
               or sustained by the Collateral Agent or any of its Affiliates in
               connection with this Agreement or the Collateral; and

          ii.  all costs and expenses of the Collateral Agent and its
               Affiliates, including Attorney Costs, in connection with the
               enforcement or attempted enforcement of, and preservation of any
               rights or interests under, this Agreement, including in any
               out-of-court workout or other refinancing or restructuring or in
               any bankruptcy case, and the protection, sale or collection of,
               or other realization upon, any of the Collateral, including all
               expenses of taking, collecting, holding, sorting, handling,
               preparing for sale, selling, or the like, and other such expenses
               of sales and collections of Collateral, and any and all losses,
               costs and expenses sustained by the Collateral Agent as a result
               of any failure by Grantor to perform or observe its obligations
               contained herein.

     b.   Indemnification. Grantor hereby agrees to indemnify the Collateral
          Agent, the other Lender Parties, any Affiliate of any of them, and
          their respective directors, officers, employees, agents, counsel and
          other advisors (each an "Indemnified Person" against, and hold each of
          them harmless from, any and all liabilities, obligations, losses,
          claims, damages, penalties, actions, judgments, suits, costs, expenses
          or disbursements of any kind or nature whatsoever, including the
          reasonable fees and

Security Agreement/Accounts          - 17 -                    September 8, 1999

<PAGE>

          disbursements of counsel to an Indemnified Person (including allocated
          costs of internal counsel), which may be imposed on, incurred by, or
          asserted against any Indemnified Person by a third party, in any way
          relating to or arising out of this Agreement or any action taken or
          omitted to be taken by it hereunder (the "Indemnified
          Liabilities", provided that Grantor shall not be liable to any
          Indemnified Person for any portion of such Indemnified Liabilities to
          the extent they are found by a final decision of a court of competent
          jurisdiction to have resulted from such Indemnified Person's gross
          negligence or willful misconduct. If and to the extent that the
          foregoing indemnification is for any reason held unenforceable,
          Grantor agrees to make the maximum contribution to the payment and
          satisfaction of each of the Indemnified Liabilities which is
          permissible under applicable law.

     c.   Other Charges. Grantor agrees to indemnify the Collateral Agent
          against and hold it harmless from any and all present and future
          stamp, transfer, documentary and other such taxes, levies, fees,
          assessments and other charges made by an, jurisdiction by reason of
          the execution, delivery, performance and enforcement of this
          Agreement.

     d.   Interest. Any amounts payable to the Collateral Agent under this
          Section 14 or otherwise under this Agreement if not paid upon demand
          shall bear interest from the date of such demand until paid in full,
          at the rate of interest set forth in subsection 2.09 of the Credit
          Agreement.

SECTION 15. Binding Effect.

This Agreement shall be binding upon, inure to the benefit of and be enforceable
by Grantor, the Collateral Agent and their respective successors and assigns.

SECTION 16. Governing Law.

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE COMMONWEALTH OF PENNSYLVANIA, EXCEPT AS REQUIRED BY
MANDATORY PROVISIONS OF LAW AND TO THE EXTENT THE VALIDITY OR PERFECTION OF THE
SECURITY INTERESTS HEREUNDER, OR THE REMEDIES HEREUNDER, IN RESPECT OF ANY
COLLATERAL ARE GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN ILLINOIS,
PROVIDED THAT THE COLLATERAL AGENT SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL
LAW.

SECTION 17. Forum Selection and Consent to Jurisdiction.

ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF PENNSYLVANIA OR OF
THE UNITED STATES FOR THE

Security Agreement/Accounts          - 18 -                    September 8, 1999

<PAGE>

EASTERN DISTRICT OF PENNSYLVANIA, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH OF GRANTOR AND THE COLLATERAL AGENT CONSENTS, FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH
OF GRANTOR AND THE COLLATERAL AGENT IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO. GRANTOR AND THE COLLATERAL AGENT EACH WAIVE PERSONAL SERVICE OF
ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY PENNSYLVANIA LAW.

SECTION 18. Waiver of Jury.

GRANTOR AND THE COLLATERAL AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL
BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED
TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE
BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY COLLATERAL
AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT
CLAIMS, TORT CLAIMS, OR OTHERWISE. GRANTOR AND THE COLLATERAL AGENT EACH AGREE
THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A
JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR
RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO
ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART,
TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.

SECTION 19. Entire Agreement; Amendment.

This Agreement contains the entire agreement of the parties with respect to the
subject matter hereof and shall not be amended except by the written agreement
of the parties as provided in the Credit Agreement.

SECTION 20. Severability.

Whenever possible, each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under all applicable laws and regulations.
If, however, any provision of this Agreement shall be prohibited by or invalid
under any such law or regulation in any jurisdiction, it

Security Agreement/Accounts          - 19 -                    September 8, 1999

<PAGE>

shall, as to such jurisdiction, be deemed modified to conform to the minimum
requirements of such law or regulation, or, if for any reason it is not deemed
so modified, it shall be ineffective and invalid only to the extent of such
prohibition or invalidity without affecting the remaining provisions of this
Agreement, or the validity or effectiveness of such provision in any other
jurisdiction.

SECTION 21. Counterparts.

This Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute but
one and the same agreement.

SECTION 22. Incorporation of Provisions of the Credit Agreement.

To the extent the Credit Agreement contains provisions of general applicability
to the Loan Documents, such provisions are incorporated herein by this
reference.

SECTION 23. No Inconsistent Requirements.

Grantor acknowledges that this Agreement and the other Loan Documents may
contain covenants and other terms and provisions variously stated regarding the
same or similar matters, and agrees that all such covenants, terms and
provisions are cumulative and all shall be performed and satisfied in accordance
with their respective terms.

SECTION 24. Termination.

Upon termination of the Commitments of the Banks under the Loan Documents, the
surrender of any Letters of Credit issued by any Issuer for the account of
Grantor, and payment and performance in full of all Secured Obligations, the
security interests granted under this Agreement shall terminate and the
Collateral Agent shall promptly execute and deliver to Grantor such documents
and instruments reasonably requested by Grantor as shall be necessary to
evidence termination of all security interests given by Grantor to the
Collateral Agent hereunder, provided, however, that the obligations of Grantor
under Section 14 shall survive such termination.

Security Agreement/Accounts          - 20 -                    September 8, 1999

<PAGE>

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

                                         MATLACK (DE), INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

                                         MATLACK, INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

Security Agreement/Accounts          - 21 -                    September 8, 1999

<PAGE>

                                         SPECIALIZED DEDICATED FLEETS, INC.
                                         successor by merger to Safeway Chemical
                                         Transportation, Inc.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE  19899
FAX No. (302) 426-3838

                                         BRITE-SOL SERVICES, INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

Security Agreement/Accounts          - 22 -                    September 8, 1999

<PAGE>

                                         MATLACK LEASING, INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

                                         SUPER SERVICE, INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

Security Agreement/Accounts          - 23 -                    September 8, 1999

<PAGE>

                                  FIRST UNION NATIONAL BANK, as Collateral Agent

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

Notices To:
Michael J. Labrum
Vice President
First Union National Bank
Transportation and Equipment Finance
PA4827
1345 Chestnut Street
Philadelphia, PA 19107
FAX No. (215) 786-7704

Security Agreement/Accounts          - 24 -                    September 8, 1999

<PAGE>

                                   Schedule 1

1.   Locations of Chief Executive Office and Other Locations, Including of
     Collateral

     a.   Chief Executive Office and Principal Place of Business:

          1 Rollins Plaza, Wilmington, DE 19803 (physical address)

          P.O. Box 8790, Wilmington, DE 19899 (mailing address)

     b.   other locations where Grantor conducts business or Collateral is kept:

          None

2.   Locations of Books Pertaining to Rights to Payment

     Wilmington, Delaware

3.   Trade Names and Trade Styles; Other Corporate, Trade or Fictitious Names,
     Etc.

     Pipeline on Wheels

4.   Inventory Stored with Warehousemen or on Leased Premises, Etc.

     N/A

5.   Patents, Copyrights, Trademarks, Etc.

     N/A

6.   Leased Equipment

     See attached.

7.   Deposit Accounts

     None

Security Agreement/Accounts          - 25 -                    September 8, 1999SECURITY AGREEMENT

     THIS SECURITY AGREEMENT (this "Agreement"), dated September 8, 1999, is
made between and among Matlack DE, Inc., Matlack, Inc., Specialized Dedicated
Fleets, Inc., successor by merger to Safeway Chemical Transportation, Inc.,
Brite-Sol Services, Inc., Matlack Leasing, Inc., Super Service, Inc (each
individually and collectively referred to as the "Grantor"), jointly and
severally, and FIRST UNION NATIONAL BANK, a national banking association, as
agent for the Banks (in such capacity, and together with its successors as agent
for the Banks, the "Collateral Agent").

                                    RECITALS

     WHEREAS, Grantor is a party to that certain Credit Agreement dated as of
August 19, 1998 between and among Grantor, the banking institutions signatories
thereto and First Union National Bank, a national banking association, as agent
for the Banks (as amended, restated, modified, renewed, supplemented or extended
from time to time, the "Credit Agreement").

     WHEREAS, pursuant to Section 9.01 of the Credit Agreement, the Banks have
required and Grantor has agreed to grant a security interest as herein provided;

     WHEREAS, the Banks have requested a security interest as permitted under
the Credit Agreement;

     NOW, THEREFORE, for and in consideration of any loan under the Credit
Agreement and any other loan or advance (including any other loan or advance by
renewal or extension) heretofore or hereafter made to Grantor by the Banks, the
parties hereto agree as follows:

     1. DEFINITIONS. Terms used herein and capitalized which are defined in the
Credit Agreement shall have the meanings ascribed to them therein. In addition,
when used herein, the following terms shall have the following meanings:

     "Assignee Deposit Account" shall have the meaning given to such term in
     Section 9 hereof.

     "Assigned Vehicle" means a Vehicle as to which Grantor shall have executed
     and delivered to the Collateral Agent a Mortgage on the Vehicle in form and
     substance as required by this Agreement.

     "Collateral" shall mean all property or rights in which a security interest
     is granted hereunder.

     "Contract Right" shall mean any right of Grantor to payment under a
     contract for the sale or lease of goods or the rendering of services, which
     right is at the time not yet earned by performance.

     "Default" has the meaning given such term in Section 12 hereof.

Security Agreement/Assigned Vehicles            - 1 -          September 8, 1999

<PAGE>

     "General Intangibles" shall have the meaning given to such term in the
     Pennsylvania Commercial Code, provided, that "General Intangibles" shall
     include, without limitation, inventions, designs, patents, patent
     applications, trademarks, trademark applications, trade names, trade
     secrets, goodwill, copyrights, registrations, licenses, franchises,
     customer lists, tax refunds claims, rights to indemnification and rights
     under warranties.

     "Liabilities" shall mean all Obligations of Grantor to the Banks under the
     Credit Agreement, and all obligations of Grantor to the Collateral Agent
     hereunder, howsoever created, arising or evidenced, whether direct or
     indirect, absolute or contingent, now or hereafter existing or due or to
     become due and all other obligations of Grantor to the Banks or either of
     them, howsoever created arising or evidenced, whether direct or indirect,
     absolute or contingent, or now or hereafter existing, or due or to become
     due.

     "Mortgage" shall mean a supplement to this Agreement confirming the
     granting of a. security interest in one or more Vehicles to the Collateral
     Agent, as collateral security in the form of Exhibit A hereto.

2. GRANT OF SECURITY INTEREST. As security for the payment of all Liabilities,
Grantor hereby assigns to the Collateral Agent, and grants to the Collateral
Agent for its benefit and the ratable benefit of the Banks, a continuing
security interest in, the following property and rights of Grantor, to the
extent owned by the Grantor, whether now or hereafter existing or acquired:

     a.   all Assigned Vehicles now or hereafter listed in any Mortgages from
          time to time executed pursuant to this Agreement, whether such
          property listed in such Mortgages constitutes machinery, equipment or
          inventory of Grantor, together with all accessions thereto or other
          property attached thereto or used in connection therewith;

     b.   all other Vehicles of Grantor, not subject to any other perfected
          contractual lien or security interest at the time of purchase by
          Grantor;

     c.   to the extent related only to the property described in the preceding
          clauses (a) and (b) and not included therein or covered thereby, all
          Contract Rights, chattel paper, instruments, documents and money and
          General Intangibles of Grantor;

     d.   any and all balances, credits, deposits (general or special, time or
          demand, provisional or final), accounts or moneys of or in the name of
          Grantor now or hereafter with the Banks or the Collateral Agent and
          any and all property of every kind or description of or in the name of
          Grantor now or hereafter, for any reason or purpose whatsoever, in the
          possession or control of, or in transit to, the Banks, the Collateral
          Agent, or any other agent or bailee for the Banks;

     e.   to the extent related to the property described in clauses (a) through
          (d) above, all books, correspondence, credit files, records, invoices
          and other papers and documents, including, without limitation, to the
          extent so related, all tapes, cards,

Security Agreement/Assigned Vehicles           - 2 -           September 8, 1999

<PAGE>

          computer runs, computer, programs and other papers and documents in
          the possession or control of Grantor or any computer bureau from time
          to time acting for Grantor, and, to the extent so related, all rights
          in, to and under all policies of insurance, including claims of rights
          to payments thereunder and proceeds therefrom, including any credit
          insurance; and

     f.   all proceeds and/or products, and/or substitutions and replacements,
          for or of any of the foregoing.

3. MAINTENANCE OF FINANCED PROPERTY. Grantor shall keep and maintain or cause
each lessee to keep and maintain the Assigned Vehicles and other Vehicles
pledged hereunder in first-class condition.

4. OWNERSHIP OF COLLATERAL, TRANSFERS. Except for the Lien created hereunder and
under the Mortgages executed and delivered pursuant to this Agreement, Grantor
is or will be the owner of the Assigned Vehicles and the other Collateral, free
from all Liens, except for Permitted Liens and will defend the Collateral
against all claims and demands of all persons at any time claiming the same or
any interest therein.

5. INSPECTION OF COLLATERAL. Grantor shall at all reasonable times and from time
to time, permit each Bank and the Collateral Agent, their respective officers,
employees and designees, to inspect and evaluate the Vehicles, including the
Assigned Vehicles, and other Collateral in its possession, and to inspect,
audit, make copies of and extracts from all records and all other papers in the
possession of Grantor which relate to the Collateral and will, upon request of
the Banks or the Collateral Agent, deliver all of such records and papers which
pertain to the Collateral.

6. USE OF VEHICLES. Grantor shall use the Collateral only in a lawful manner not
inconsistent with this Agreement, the Credit Agreement and the Loan Documents
and terms and conditions of any policy of insurance regarding the Assigned
Vehicles.

7. ADDITIONAL REPRESENTATIONS AND WARRANTIES. Grantor hereby represents and
warrants:

     a.   that the execution and delivery of this Agreement and each of the
          Mortgages, and the fulfillment of compliance with the terms and
          provisions hereof or thereof, will not conflict with or result in a
          breach of any of the terms, conditions or provisions of the Articles
          of Incorporation or the By-Laws of Grantor or of any bond, debenture,
          note, mortgage, indenture, agreement or other instrument to which
          Grantor is a party or by which it or its property may be bound, or
          constitute (with the giving of notice or the passage of time or both)
          a default thereunder, or result in the creation or imposition of any
          Lien, of any nature whatsoever upon the Collateral pursuant to the
          terms of any such agreement or instrument;

Security Agreement/Assigned Vehicles           - 3 -           September 8, 1999

<PAGE>

     b.   that no event has occurred which is or with notice or the passage of
          time would be a Default hereunder;

     c.   this Agreement has been duly executed and delivered by Grantor and
          constitutes the legal, valid and binding obligation of Grantor
          enforceable against Grantor in accordance with its terms and the grant
          of the security interest in the Collateral existing on the date hereof
          constitutes, and, as to subsequently acquired Collateral, will
          constitute, a valid and perfected first and prior Lien and security
          interest, superior to the rights of any other person in and to the
          Collateral;

     d.   all such action as is necessary has been taken to establish and
          perfect the Collateral Agent's rights in and to the Collateral and all
          financing statements relating thereto have been duly submitted for
          filing, recordation and/or registration in each office and in each
          Jurisdiction where required, and all notations have been made on any
          certificate of title, if any, issued in respect of any part of the
          Collateral where such notation is required in order to create and
          perfect the first lien and security interest described above, and
          except as provided above, no action by or with any governmental
          authority is required in connection with the execution, delivery and
          performance of this Agreement and the grant of the security interest
          contemplated hereby;

     e.   all information with respect to Collateral set forth in any Mortgage,
          schedule, certificate or other writing at any time heretofore or
          hereafter furnished by Grantor to the Banks or the Collateral Agent,
          and all other written information heretofore or hereafter furnished by
          Grantor to the Banks or the Collateral Agent is and will be true and
          correct as of the date furnished;

     f.   none of the Collateral is a fixture under applicable law or is
          attached or to be attached to realty in any manner which might
          materially adversely affect the collateral value to the Banks of such
          Collateral or materially adversely affect Grantor's ownership of or
          interest in such Collateral.

8. ADDITIONAL COVENANTS. Grantor agrees:

     a.   to keep the Collateral free and clear of all Liens whatsoever, except
          those created by this Agreement or Permitted Liens and to pay all
          charges, including without limitation, all taxes and assessments
          levied or assessed against Grantor, which if unpaid would constitute a
          Lien on the Collateral or any portion thereof. Grantor shall not be
          required to pay or discharge any such charges, taxes or assessments so
          long as it shall in good faith and by appropriate legal proceedings,
          contest the validity thereof in any reasonable manner provided that
          non-payment of such disputed taxes will not affect or endanger, the
          Collateral Agent's security interest in the Collateral pursuant to
          this Agreement, or result in the imposition of a Lien on the
          Collateral;

Security Agreement/Assigned Vehicles           - 4 -           September 8, 1999

<PAGE>

     b.   will upon request of the Collateral Agent, deliver lists specifically
          identifying all Collateral and execute Mortgages with respect to all
          Vehicles constituting Collateral;

     c.   will, upon request of the Collateral Agent, execute such financing
          statements and other documents (and pay the cost of filing or
          recording the same in all public offices deemed necessary by the
          Collateral Agent) and do such other acts and things, all as the
          Collateral Agent may from time to time request, to establish and
          maintain a valid security interest in the Collateral (free of all
          other Liens, claims and rights of third parties except for Liens
          permitted by Section 4 hereof) to secure the payment of the -------
          Liabilities, including, without limitation if necessary to perfect a
          security interest, depositing with the Collateral Agent any
          certificate of title issuable with respect to any of the Collateral
          and noting thereon the security interest hereunder. Grantor agrees
          that any carbon, photographic or other reproduction of this Agreement
          or of any such Mortgage or financing statement shall be sufficient for
          filing as a financing statement;

     d.   that all accessions which become attached to or part of any Collateral
          shall become subject to the terms of this Agreement and shall
          constitute part of the Collateral which secures payment of the
          Liabilities and shall not be subject to any other lien, claim, or
          encumbrance in favor of any other party except Permitted Liens;

     e.   that Grantor will not remove its records concerning the Collateral
          from the address listed in on the first page of this Agreement except
          to a jurisdiction where the Uniform Commercial Code shall be in
          effect, and upon 30 days' prior written notice to the Banks and the
          Collateral Agent;

     f.   that Grantor shall not permit any of the Collateral to be or to become
          fixtures under applicable law;

     g.   to reimburse the Banks and the Collateral Agent upon demand for all
          reasonable costs and expenses, including reasonable fees of attorneys
          for the Banks and the Collateral Agent (who may be employees of the
          Bank and the Collateral Agent) and legal expenses, incurred by the
          Banks and the Collateral Agent in seeking to collect or enforce any
          rights under the Collateral and, in case of Default, in seeking to
          collect each Note and all other Liabilities and to enforce rights
          hereunder, including expenses of any repairs to any realty or other
          property to which any of the Collateral may be affixed or be a part;

     h.   to reimburse the Banks and the Collateral Agent upon demand for all
          reasonable costs and expenses incurred by the Banks and the Collateral
          Agent, their respective agents or designees in the course of the
          evaluations audits and extractions referred to in Section 5;

Security Agreement/Assigned Vehicles            - 5 -          September 8, 1999

<PAGE>

     i.   to furnish, at the request of either Bank at monthly intervals, such
          information concerning the Collateral to the Banks and the Collateral
          Agent as may be requested, including, without limitation, with respect
          to the period for which such report is made, a description of all net
          proceeds received from the sale destruction, commandeering,
          conversion, loss of or damage to, or use of, attachment, or insurance
          on or with respect to the Collateral;

     j.   to cause the insurance arrangements required by the Credit Agreement
          to be for the benefit of Grantor and the Collateral Agent as their
          interests may appear (the Collateral Agent's interest to be for the
          benefit of itself and the Banks), provided that all insurance policies
          shall provide for ten (10) days written minimum cancellation notice to
          Grantor and the Collateral Agent, and provided further, that after a
          Default in the event of such cancellation and failure on the part of
          Grantor to provide adequate insurance arrangements satisfactory to the
          Banks and the Collateral Agent, the Collateral Agent, may at its
          option provide such insurance and charge the cost thereof to Grantor
          as provided for elsewhere in this Agreement; and

     k.   not use any mobile goods outside the territorial limits of the United
          States, Mexico and Canada unless the Collateral Agent shall otherwise
          consent in writing.

The Collateral Agent may from time to time, at its option after a Default,
perform any agreement of Grantor hereunder which Grantor shall fail to perform
and take any other action which the Collateral Agent deems necessary for the
maintenance or preservation of any of the Collateral or its interest therein,
and Grantor agrees to forthwith reimburse the Collateral Agent for all expenses
in connection with the foregoing, together with interest thereon at the Default
Rate, from the date incurred until reimbursed by Grantor.

9. RIGHTS OF COLLATERAL AGENT.

     a.   Grantor hereby irrevocably constitutes and appoints the Collateral
          Agent and its agents as its attorney in fact with full power and
          authority either in its own name or in the name of Grantor to take any
          and all appropriate action and to execute any and all documents and
          instruments which may be necessary or desirable to accomplish the
          purposes of this Agreement including without limitation, the foregoing
          appointment authorizes the Collateral Agent without notice to or
          assent by Grantor, to do the following: (i) after a Default, to
          endorse any loss payment or returned premium check and to make, settle
          and release any claim under any insurance policy with respect to any
          Collateral; (ii) after a Default, to file any claim or take any other
          action or proceeding in any court of law or equity for the purpose of
          collecting any and all monies due under or with respect to any of the
          Collateral; (iii) after a Default, to file a financing statement
          signed only by the Collateral Agent with respect to this Agreement in
          accordance with the Uniform Commercial Code or signed by the
          Collateral Agent as attorney in fact for Grantor; (iv) after a
          Default, upon the occurrence and continuance of a failure by Grantor
          to do so, to pay or discharge

Security Agreement/Assigned Vehicles          - 6 -            September 8, 1999

<PAGE>

          taxes, liens, security interests or other encumbrances levied or
          placed on or threatened against the Collateral, to effect any repairs
          or any insurance called for by the terms of this Agreement or the
          Credit Agreement and to pay all or any part of the premiums therefor
          and the cost thereof; (v) after a Default, to receive payment of and
          receipt for any and all monies claims and other amounts due and to
          become due at any time in respect of or arising out of any Collateral;
          (vi) after a Default, to commence and prosecute any suits, actions or
          proceedings at law or in equity in any court of competent jurisdiction
          to collect the Collateral or any part thereof and to enforce any other
          right in respect of the Collateral; (vii) after a Default, to settle,
          compromise or adjust any suit, action or proceeding described above
          and, in connection therewith, to give such discharges or releases as
          the Banks may deem appropriate; and (viii) after a Default, generally
          to sell, transfer, pledge, make any agreement with respect to or
          otherwise deal with any of the Collateral as fully and completely as
          though the Collateral Agent were the absolute owner thereof for all
          purposes, and to do, at the Collateral Agent's option, at any time, or
          from time to time, all acts and things which the Collateral Agent
          deems necessary to protect, preserve or realize upon the Collateral
          and the Collateral Agent's security interest therein in order to
          effect the intent of this Agreement, all as fully and effectively as
          Grantor might do. Grantor hereby ratifies all that said attorneys
          shall lawfully do or cause to be done by virtue hereof. This power of
          attorney is a power coupled with an interest, shall be irrevocable and
          shall terminate only upon payment in full of the Liabilities and the
          termination of this Agreement. The powers conferred on the Collateral
          Agent hereunder are solely to protect the Collateral Agent's interests
          in the Collateral and shall not impose any duty upon it to exercise
          any such powers. Any insurance premiums, taxes, assessments, charges,
          and other amounts so paid by the Collateral Agent shall constitute
          part of the Liabilities payment of which shall be secured by the
          Collateral and shall be payable on demand by Grantor. The Banks and
          the Collateral Agent shall be accountable only for amounts that are
          actually received as a result of the exercise of such powers, and
          neither the Banks, the Collateral Agent nor any of their respective
          officers, directors, employees or agents shall be responsible to
          Grantor for any action taken or omitted to be taken in good faith or
          in reliance on the advice of counsel except for their own gross
          negligence or willful misconduct.

     b.   After a Default, unless otherwise consented to by the Collateral
          Agent, Grantor will forthwith, upon receipt, transmit and deliver to
          the Collateral Agent, in the form received, all cash, checks, drafts,
          chattel paper and other instruments or writings for the payment of
          money (properly endorsed, where required, so that such items may be
          collected by the Collateral Agent) which may be received by Grantor at
          any time in full or partial payment or otherwise as proceeds of any of
          the Collateral. Any such items which may be received by Grantor after
          such request by the Collateral Agent will not be commingled with any
          other of its funds or property, but will be held separate and apart
          from its own funds or property and upon express trust for the Banks
          until delivery is made to the Collateral Agent.

Security Agreement/Assigned Vehicles           - 7 -           September 8, 1999

<PAGE>

     c.   All items or amounts which are received by the Collateral Agent after
          a Default from Grantor or any other party on account of partial or
          full payment or otherwise as proceeds of any of the Collateral shall
          be deposited to the credit of a deposit account (herein called the
          "Assignee Deposit Account") of Grantor with the Collateral Agent, as
          security for payment of the Liabilities. Grantor shall have no right
          to withdraw any funds deposited in the Assignee Deposit Account.
          Either Bank may, from time to time, in its discretion, and shall upon
          request of Grantor made not more than once in any week, direct the
          Collateral Agent to transfer all or any of the then balance,
          representing collected funds, in the Assignee Deposit Account ratably
          to the Banks, who shall promptly apply such funds, first, toward
          payment of the Liabilities under the Credit Agreement, the Loan
          Documents and this Agreement, and, second, toward payment of any other
          Liabilities, whether or not then due, in such order of application as
          the Banks may determine, and the Banks may, from time to time, in
          their discretion, direct the Collateral Agent to release all or any of
          such balance to Grantor. The Collateral Agent is authorized to
          endorse, in the name of Grantor, any item, howsoever received by the
          Collateral Agent, representing any payment on or other proceeds of any
          of the Collateral.

10. THE COLLATERAL AGENT.

     The Banks and the Collateral Agent agree among themselves as follows:

     a.   Responsibilities and Duties of Collateral Agent.

          i.   The Collateral Agent shall have no duties or responsibilities
               except those expressly set forth in this Agreement and those
               duties and liabilities shall be subject to the limitations and
               qualifications set forth in this Section. The duties of the
               Collateral Agent shall be mechanical and administrative in
               nature.

          ii.  Neither the Collateral Agent nor any of its directors, officers
               or employees shall be liable for any action taken or omitted
               (whether or not such action taken or omitted is within or without
               the Collateral Agent's responsibilities and duties expressly set
               forth in this Agreement, the Credit Agreement or any other
               instrument or document in connection herewith), except for gross
               negligence or willful misconduct. Without limiting the foregoing,
               neither the Collateral Agent nor any of its directors, officers
               or employees shall be responsible for, or have any duly to
               examine:

               (1)  the genuineness, execution, validity, effectiveness,
                    enforceability, value or sufficiency of (a) this Agreement,
                    or (b) any document or instrument furnished pursuant to or
                    in connection with this Agreement,

Security Agreement/Assigned Vehicles          - 8 -            September 8, 1999

<PAGE>

               (2)  the collectibility of any amounts owed by Grantor,

               (3)  any recitals or statements or representations or warranties
                    in connection with this Agreement, the Credit Agreement, or
                    the Loan Documents,

               (4)  any failure of any party to this Agreement to receive any
                    communication sent, or

               (5)  the assets, liabilities, financial condition, results of
                    operations, business or creditworthiness of Grantor.

          iii. The Collateral Agent shall be entitled to act, and shall be fully
               protected in acting upon, any communication in whatever form
               believed by the Agent in good faith to be genuine and correct and
               to have been signed or sent or made by a proper person or persons
               or entity. The Collateral Agent may consult counsel and shall be
               entitled to act, and shall be fully protected in any action taken
               in good faith, in accordance with advice given by counsel. The
               Collateral Agent may employ agents and attorneys-in-fact and
               shall not be liable for the default or misconduct of any such
               agents or attorneys-in-fact selected by the Collateral Agent with
               reasonable care. The Collateral Agent shall not be bound to
               ascertain or inquire as to the performance or observance of any
               of the terms, provisions or conditions of this Agreement, the
               Credit Agreement or the Loan Documents on Grantor's part.

     b.   Action on Instructions. The Collateral Agent shall be entitled to act
          or refrain from acting, and in all cases shall be fully protected in
          acting or refraining from acting under this Agreement, or any other
          instrument or document in connection herewith or therewith in
          accordance with Instructions in writing from the Banks.

     c.   Indemnification. To the extent Grantor does not reimburse and save the
          Collateral --------------- Agent harmless according to the terms
          hereof for and from all costs, expenses and disbursements in
          connection herewith or with the Credit Agreement, such costs, expenses
          and disbursements to the extent reasonable shall be borne by the Banks
          ratably in accordance with their pro rata share of the Credit. The
          Banks shall (a) reimburse the Collateral Agent for all such reasonable
          costs, expenses and disbursements on request and (b) indemnify and
          save harmless the Collateral Agent against and from any and all
          losses, obligations, penalties, actions, judgments and suits and other
          reasonable costs, expenses and disbursements of any kind or nature
          whatsoever which may be imposed on, incurred by or asserted against
          the Collateral Agent, other than as a consequence of actual gross
          negligence or willful misconduct on the part of the Collateral Agent,
          arising out of or in connection with this Agreement, or any instrument
          or document in connection herewith or therewith or

Security Agreement/Assigned Vehicles          - 9 -            September 8, 1999

<PAGE>

          any request of the Banks, including without limitation the reasonable
          costs, expenses and disbursements in connection with defending itself
          against any claim or liability, or answering any subpoena, related to
          the exercise or performance of any of its powers or duties under this
          Agreement or the taking of any action under or in connection with this
          Agreement the Credit Agreement or the Loan Agreement.

     d.   Successor Agent. The Collateral Agent may resign at any time by giving
          at least 30 days written notice thereof to the Banks and Grantor. Upon
          any such resignation, the Banks and the Collateral Agent shall have
          the right to appoint a successor Collateral Agent. If no successor
          Collateral Agent shall have been appointed by the Banks and the
          Collateral Agent and shall have accepted such appointment within 30
          days after the retiring Collateral Agent's giving notice of
          resignation, then the retiring Collateral Agent may, but shall not be
          required to, on behalf of the Banks and the Collateral Agent, appoint
          a successor Collateral Agent.

11. RELEASES. Prior to the termination of the Credit Agreement and the payment
in full of all Liabilities of Grantor, the Collateral Agent shall execute and
deliver an appropriate release of the Lien of this Agreement and any Mortgage
with respect to any Assigned Vehicle which Grantor wishes to sell, provided that
no Default or Potential Event of Default shall have occurred and he continuing.
Upon the termination of the Credit Agreement and the payment in full of the
liabilities thereunder, the Collateral Agent shall discharge all Mortgages and
release all Collateral held pursuant to this Agreement.

12. DEFAULT. The occurrence of any of the following shall be deemed a Default
under this Agreement: (a) non-payment, when due, of any amount payable on any of
the Liabilities or failure to perform any agreement of Grantor contained herein
or in any other agreement of Grantor with the Banks; (b) any warranty of Grantor
herein or in any other agreement of Grantor with the Banks is untrue in any
material respect; or (c) any Event of Default or Potential Default shall occur
under the Credit Agreement.

Whenever a Default shall be existing, the Liabilities may (notwithstanding any
provisions thereof), at the option of the Banks and the Collateral Agent in the
case of Liabilities owed to the Bank or the Collateral Agent and without demand
or notice of any kind, be declared, and thereupon immediately shall become, due
and payable, and the Collateral Agent may at the direction of the Banks exercise
from time to time any rights and remedies available to them under applicable
law. Grantor agrees, in case of Default, to assemble, at its expense, all
Collateral in its possession and control at a convenient. place acceptable to
the Collateral Agent. Without limiting the foregoing, upon Default the
Collateral Agent may at the direction of the Banks, to the fullest extent
permitted by applicable law, without notice, hearing or process of law of any
kind, (a) enter upon any premises where any of the Collateral may be located and
take possession of and remove such Collateral; (b) use, license or, to the
extent permitted by an applicable license, sublicense, whether general, special
or otherwise, and whether on an exclusive or non-exclusive basis, any Collateral
throughout the world for such term or terms, on such conditions, and in such
manner, as the Collateral Agent shall in its sole discretion determine, without
compensation to Grantor; and (c) sell any or all of the Collateral, free

Security Agreement/Assigned Vehicles          - 10 -           September 8, 1999

<PAGE>

of all rights and claims of Grantor therein and thereto, at, any public or
private sale. Upon Default, the Collateral Agent, the Banks may bid for and
purchase any or all of such Collateral at any such sale. Grantor hereby
expressly waives, to the fullest extent permitted by applicable law, any and all
notices, advertisements, hearings or process of law in connection with the
exercise by the Collateral Agent of any of its rights and remedies upon Default.
Any notification of intended disposition of any of Collateral required by law
shall be deemed reasonably and properly given if given at least five days before
such disposition. Any proceeds of any disposition by the Collateral Agent of any
of the Collateral may be applied by the Collateral Agent to the payment of
expenses in connection with the Collateral, including reasonable attorneys' fees
and legal expenses, and any balance of such proceeds may be applied by the
Banks, first, toward the payment of the Liabilities under the Credit Agreement,
the Loan Agreement and this Agreement and, second, toward the payment of any
other Liabilities.

13. MISCELLANEOUS.

     a.   Collateral Agent's Duties. The Collateral Agent shall be deemed to
          have exercised reasonable care in the custody and preservation of any
          of the Collateral in its possession if it takes such action for that
          purpose as Grantor requests in writing, but failure of the Collateral
          Agent to comply with any such request shall not of itself be deemed a
          failure to exercise reasonable care, and no failure of the Collateral
          Agent to preserve or protect any rights with respect to such
          Collateral against prior parties, or to do any act with respect to the
          preservation of such Collateral not so requested by Grantor, shall be
          deemed a failure to exercise reasonable care in the custody or
          preservation of such Collateral.

     b.   Notices. Any notice from the Collateral Agent to Grantor, if by
          telegram or telex, shall he deemed given when sent, and, if mailed,
          shall he deemed given when mailed, postage prepaid, addressed to
          Grantor either at Grantor's address shown on the signature page
          hereto, or at any other address of Grantor appearing on the records of
          the Collateral Agent.

     c.   Waivers. Grantor hereby expressly waives: (a) notice of acceptance by
          the Collateral Agent of this Agreement, (b) notice of the existence or
          creation of all or any Liabilities, and (c) all diligence in
          collection or protection of or realization upon the Liabilities or any
          thereof.

     d.   No Waiver; Cumulative Remedies. No failure on the part of the
          Collateral Agent to exercise, and no delay in exercising, any right,
          power or remedy shall operate as a waiver thereof, nor shall any
          single or partial exercise by the Collateral Agent of any right, power
          or remedy preclude other or further exercise thereof or the exercise
          of any other right, power or remedy. All remedies hereunder are
          cumulative and are not exclusive of any other remedies which may be
          available to the Collateral Agent at law or in equity or under any
          other agreement or instrument relating to any of the Liabilities or
          any security therefor.

Security Agreement/Assigned Vehicles            - 11 -         September 8, 1999

<PAGE>

     e.   Governing Law. This Agreement has been delivered at Philadelphia,
          Pennsylvania, and shall be construed in accordance with and governed
          by the laws of the Commonwealth of Pennsylvania. Whenever possible,
          each provision of this Agreement shall be interpreted in such manner
          as to be effective and valid under applicable law, but if any
          provision of this Agreement shall be prohibited by or invalid under
          applicable law, such provision shall be ineffective to the extent of
          such prohibition or invalidity without invalidating the remainder of
          such provision or the remaining provisions of this Agreement.

     f.   Binding Effect. The rights and privileges of the Collateral Agent
          hereunder shall inure to the benefit of its successors and assigns.

     g.   Waiver of Jury Trial. Grantor waives any right to a trial by jury in
          any action or proceeding to enforce or defend any rights (i) under
          this Agreement or under any amendment, instrument, document or
          agreement delivered or which may in the future be delivered in
          connection herewith or (ii) arising from any banking relationship
          existing in connection with this Agreement, and agrees that any such
          action or proceeding shall be tried before a court and not before a
          jury.

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

                                         MATLACK (DE), INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

Security Agreement/Assigned Vehicles          - 12 -           September 8, 1999

<PAGE>

                                         MATLACK, INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

                                         SPECIALIZED DEDICATED FLEETS, INC.
                                         successor by merger to Safeway Chemical
                                         Transportation, Inc.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

Security Agreement/Assigned Vehicles          - 13 -           September 8, 1999

<PAGE>

                                         BRITE-SOL SERVICES, INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

                                         MATLACK LEASING, INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

                                         SUPER SERVICE, INC.

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

Notices To:
Patrick J. Bagley
Vice President & Chief Financial Officer
Matlack Systems, Inc.
P.O. Box 8790
Wilmington, DE 19899
FAX No. (302) 426-3838

Security Agreement/Assigned Vehicles          - 14 -           September 8, 1999

<PAGE>

                                  FIRST UNION NATIONAL BANK, as Collateral Agent

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

Notices To:
Michael J. Labrum
Vice President
First Union National Bank
Transportation and Equipment Finance Group
PA4827
1345 Chestnut Street
Philadelphia, PA 19107
FAX No. (215) 786-7704

Security Agreement/Assigned Vehicles           - 15 -          September 8, 1999

<PAGE>

                                    EXHIBIT A

                                    MORTGAGE

Reference is hereby made to that certain Security Agreement, dated August 3,
1999 (the "Agreement), between and among Matlack DE, Inc., Matlack, Inc.,
Brite-Sol Services, Inc., Matlack Leasing, Inc., Super Service, Inc. (each
individually and collectively referred to as the "Grantor"), jointly and
severally, and FIRST UNION NATIONAL BANK, a national banking association, as
agent for the Banks (in such capacity, and together with its successors as agent
for the Banks, the "Collateral Agent"). Grantor hereby grants a security
interest to Collateral Agent pursuant to the Agreement in the Assigned Vehicles
(as defined in the Agreement) listed on Schedule A hereto.

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

                                            By:
                                            Title:

Security Agreement/Assigned Vehicles           - 16 -          September 8, 1999

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00000-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00000-of-00352.parquet"}]]