Document:

WELLS FARGO BANK                                                       TERM NOTE

$8,073,889.28                                                   Phoenix, Arizona
                                                               November 24, 1999

     FOR VALUE RECEIVED, the undersigned KNIGHT TRANSPORTATION INC. (`Borrower")
promises to pay to the order of WELLS FARGO BANK, NATIONAL  ASSOCIATION (`Bank')
at its office at ARIZONA RCBO #03839, 100 WEST WASHINGTON, PHOENIX, AZ 85003, or
at such other place as the holder hereof may  designate,  in lawful money of the
United States of America and in immediately  available  funds, the principal sum
of $8,073,889.28, with interest thereon as set forth herein.

INTEREST:

     (a) INTEREST.  The  outstanding  principal  balance of this Note shall bear
interest at the rate of 5.75000%  per annum  (computed on the basis of a 360-day
year, actual days elapsed.

     (b) DEFAULT  INTEREST.  From and after the maturity  date of this Note,  or
such earlier date as all principal  owing  hereunder  becomes due and payable by
acceleration or otherwise,  the outstanding principal balance of this Note shall
bear interest until paid in full at an increased rate per annum (computed on the
basis of a 360-day  year,  actual  days  elapsed)  equal to 4% above the rate of
interest from time to time applicable to this Note.

REPAYMENT AND PREPAYMENT:

     (a)  REPAYMENT.  Principal and interest  shall be payable on the 1ST day of
each MONTH in installments of $192,558.23 each, commencing DECEMBER 1, 1999, and
continuing  up to and  including  SEPTEMBER  1, 2003,  with a final  installment
consisting  of all  remaining  unpaid  principal  and accrued  interest  due and
payable in full on OCTOBER 1, 2003.

     (b)  APPLICATION  OF  PAYMENTS.  Each  payment  made on this Note  shall be
credited  first,  to any  interest  then  due  and  second,  to the  outstanding
principal balance hereof.

     (c) PREPAYMENT.  Borrower may prepay  principal on this Note at any time in
the minimum amount of  $100,000.00;  provided  however,  that if the outstanding
principal balance of this Note is less than said amount,  the minimum prepayment
amount  shall  be  the  entire   outstanding   principal   balance  hereof.   In
consideration of Bank providing this prepayment  option to Borrower,  or if this
Note shall become due and payable at any time prior to the maturity  date hereof
by acceleration or otherwise, Borrower shall pay to Bank immediately upon demand
a fee which is the sum of the discounted monthly differences for each mono, from
the month of prepayment through the month in which this Note matures, calculated
as follows for each such month:

     (i) DETERMINE the amount of interest which would have accrued each month on
the  amount  prepaid  at the  interest  rate  applicable  to such  amount had it
remained outstanding until the scheduled maturity date hereof.

     (ii) SUBTRACT from the amount determined in U) above the amount of interest
which  would  have  accrued  for the same month on the  amount  prepaid  for the
remaining term of this Note at the Money Market Funds Rate in effect on the date
of prepayment  for new loans made for such term and in a principal  amount equal
to the amount prepaid.

     (iii) It the result  obtained  in (ii) for any month is greater  than zero,
discount that difference by the Money Market Funds Rate used in (ii) above.

Each  Borrower  acknowledges  that  prepayment of such amount may result in Bank
incurring  additional  costs,  expenses  and/or  liabilities,  and  that  it  is
difficult  to  ascertain  the  full  extent  of  such  costs,   expenses  and/or
liabilities.  Each  Borrower,  therefore,  agrees  to  pay  the  above-described
prepayment fee and agrees that said amount  represents a reasonable  estimate of
the prepayment costs,  expenses and/or liabilities of Bank. If Borrower fails to
pay any  prepayment  fee when  due,  the  amount  of such  prepayment  fee shall
thereafter  bear interest  until paid at a rate per annum 2.000% above the Prime
Rate in effect  from  time to time  (computed  on the  basis of a 360-day  year,
actual  days  elapsed).  The "Prime  Rate" is a base rate that Bank from time to
time  establishes  and which serves as the basis upon which  effective  rates of
interest are calculated for those loans making reference thereto. Each change in
the rate of interest on any such past due prepayment fee shall become  effective
on the date each Prime Rate change is announced within Bank.

     The "Money  Market  Funds  Rate"  shall mean the rate per annum  which Bank
estimates  and  quotes  to its  borrowers  as the  rate,  adjusted  for  reserve
requirements,  federal deposit insurance,  and any other amount which Bank deems
appropriate,  at which  funds in the  amount  of a loan and for a period of time
comparable  to the term of such loan are  available  for  purchase  in the money
market  on the date  such loan is made,  with the  understanding  that the Money
Market Funds Rate is Bank's  estimate  only and that Bank is under no obligation
to actually  purchase and/or match funds for any  transaction.  This rate is not
fixed by or  related  in any way to any rate Bank  quotes  or pays for  deposits
accepted through its branch system.
<PAGE>
     All prepayments of principal shall be applied on the most remote  principal
installment or installments then unpaid.

EVENTS OF DEFAULT:

     This Note is made pursuant to and is subject to the terms and conditions of
that certain Credit Agreement between Borrower and Bank dated as of NOVEMBER 24,
1999, as amended from time to time (the "Credit Agreement").  Any default in the
payment or performance  of any obligation  under this Note, or any defined event
of default under the Credit  Agreement,  shall  constitute an "Event of Default"
under this Note.

MISCELLANEOUS:

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

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

     (c)  GOVERNING  LAW.  This  Note  shall be  governed  by and  construed  in
accordance with the laws of the state of Arizona.

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

KNIGHT TRANSPORTATION, INC.

By: /s/ Clark Jenkins
   ------------------------
Title: CFO
      ---------------------MASTER EQUIPMENT LEASE AGREEMENT

     Quad-K Leasing, Inc., an Arizona corporation ("Lessor"),  5601 West Buckeye
Road, Phoenix, Arizona 85043, and Knight Transportation  Indianapolis,  Inc., an
Arizona corporation ("Lessee"),  5601 West Buckeye Road, Phoenix, Arizona 85043,
hereby enter into the following agreement.

     1. Lease.  Lessor hereby leases to Lessee,  and Lessee agrees to lease from
Lessor that certain  Equipment  described in Exhibit "A" hereto.  Lessor  hereby
agrees to lease to Lessee and Lessee agrees to Lease from Lessor any  additional
Equipment listed on Exhibit "A" hereto from time to time and any Equipment shown
in Lessor's records as leased to the Lessee.  Lessor is a licensed motor vehicle
carrier (MC #227271).  Lessor shall be responsible  for obtaining and paying any
motor vehicle carrier license or tax on any of the Equipment.

     2. Possession and Use. The Equipment  shall be kept in Lessee's  possession
and  Lessee  shall  be  responsible  for the care  and  maintenance  of all such
Equipment. The Equipment shall be used solely in connection with Lessee's medium
to short haul truckload  carrier  business and shall be stored and maintained at
Lessee's  principal place of business located at 23623 Colonial  Parkway,  Katy,
Texas. The Equipment shall be used solely in the loading and  transportation  of
personal property in connection with Lessee's truckload carrier business.

     3. Lease Term. The Lease shall govern the lease of equipment between Lessor
and Lessee from and after October 1, 1998.  The initial term of this Lease shall
expire on  September  30,  1999.  The Lease shall be  automatically  renewed for
successive additional one year terms, without action by Lessor or Lessee, unless
Lessee  notifies Lessor within 30 days prior to the expiration of any Lease term
(or renewal thereof) that it is terminating this Lease.

     4. Rent.  In  consideration  for this Lease,  Lessee shall pay to Lessor an
amount  equal  to  all  Lessor's  costs  of  operations,   including   equipment
maintenance,  and such  other  amounts  as Lessor  may be  required  to pay with
respect to the Equipment leased hereby,  except as otherwise provided in Section
13.  Lessor  shall  bill  Lessee  and  Lessee  shall  pay  monthly  the Rent due
hereunder. As additional rent, Lessee agrees to pay Lessor 100% of all detention
and accessorial service charges.

     5. Loading and Unloading.  Lessee shall be solely  responsible  for loading
and unloading the Equipment.  In the event Lessor loads the Lessee's  Equipment,
Lessor shall be entitled to assess Lessee a reasonable charge therefor.

     6. Return of the  Equipment.  At the  expiration of the term of this Lease,
Lessee shall, at its own cost and expense,  return the Equipment to Lessor at to
a place  designated by Lessor,  in as good  condition and repair as it presently
is, reasonable wear and tear and normal depreciation excepted.  Lessee shall not
be  obligated to replace,  return or repair any loss or total damage  covered by
insurance which Lessee is obligated to provide and carry pursuant to this Lease,
if Lessee elects to pay such insurance  proceeds to Lessor.  In that event,  the
<PAGE>
Equipment  shall be removed  from this Lease and Lessor shall not be entitled to
any rental from such removed Equipment,  after payment of all insurance proceeds
to Lessor.

     7. Driver Requirements.  Lessee shall be solely responsible for maintaining
all driver logs, cargo manifests, driver records, delivery records and any other
documentation  required  by  the  United  States  Department  of  Transportation
("DOT"). Lessee shall at all times comply with all federal, state and local laws
relating to or governing the  Equipment or its  operation.  Lessee  acknowledges
that motor  carriers  are  required to use drivers who are  qualified  under the
safety  regulations  set  forth  at 49 CFR  ss.ss.  391.63  through  391.65.  In
addition,  Lessee  acknowledges  that 49 CFR ss.  395.8(j)(2)  requires  a motor
carrier  who uses a driver  intermittently  to obtain  from that driver a signed
statement  giving the total time on duty during the immediately  preceding seven
days from the time at which the  driver  was last  relieved  from duty  prior to
beginning work for the motor carrier.  Lessee agrees to comply at all times with
all laws  applicable to the operation of the Equipment and  applicable to Lessee
as a truck-load  motor carrier,  including,  without  limitation,  any state and
federal laws governing safety, use, weight or size requirements or governing the
nature of the cargo which may be  transported  or the  financial  responsibility
requirements  relating to the  operation of a motor carrier  including,  without
limitation, any requirements relating to insurance or self-insurance.

     8. Title.  Title to the Equipment  shall remain in Lessor and the Equipment
shall  constitute  the personal  property of Lessor.  Lessee  agrees to keep the
Equipment  free and clear of any and all liens,  encumbrances  or claims created
by,  through or as a result of Lessee's use of the Equipment  during the term of
this Lease.  Lessor may lien or encumber  the  Equipment  at any time and to any
extent.

     9.  Insurance.  Lessee  shall,  at its own  expense,  insure the  Equipment
against loss by fire, theft and extended risk coverage,  including collision and
property damage and personal  liability  insurance.  Property  damage  insurance
shall be in an amount equal to the full value of the  Equipment as determined by
Lessor.  In  addition,  Lessee  shall  obtain and  maintain  in force and effect
insurance coverage for personal injury,  collision, and comprehensive damage and
property damage not less than $1,000,000 per occurrence, with an aggregate limit
of not less than  $1,000,000 per occurrence.  Lessor may self-insure  claims for
personal  injury,  collision,  comprehensive  damage and property damage up to a
maximum limit of $250,000 per occurrence and for collision,  comprehensive,  and
cargo  liability and up to a combined  limit of $50,000 per  occurrence.  Lessee
shall cause Lessor to be named on such policies as an additional insured. Lessee
shall provide  evidence of such coverage to Lessor at Lessor's  written request.
Lessee shall pay all premiums for such insurance  prior to delinquency and shall
not permit coverage to lapse or be terminated during the term of this Lease.

     10.  Indemnity.  Lessee hereby agrees to indemnify and hold Lessor harmless
for, from and against any and all actions, claims, demands, liabilities, damages
or costs or expenses,  including  attorneys'  fees and costs of court,  expert's
fees and  other  fees or costs,  arising  from or in  connection  with any claim
brought or asserted  against  Lessor by any person or entity on account of or in
connection with Lessee's operation of the Equipment,  whether such claim results
from personal  injury,  death,  or damage to property or cargo,  so long as such
claim  is  caused  in  whole  or in part by  Lessee's  use or  operation  of the
Equipment  during  the  term  of this  Lease.  Lessor's  indemnification  rights
hereunder  shall be in addition to any  contractual  or other rights it may have
against Lessee under the terms and conditions of this Lease.

                                      -2-
<PAGE>
     11. Inspection of Equipment.  Lessee shall,  upon Lessor's request,  permit
Lessor or its  representative  to inspect the Equipment at any location where it
is  stored  and  Lessee  shall  provide  Lessor  with  reasonable  access to the
Equipment  from time to time in order to  determine  its  condition  and whether
Lessee is maintaining  the Equipment in accordance with the terms and conditions
of this Lease.

     12. Maintenance and Repair. Lessor shall perform all maintenance and repair
of the Equipment including,  without limitation,  day-to-day maintenance and the
replacement  of engines or other  capital  items.  Lessee shall  cooperate  with
Lessor to establish a regular  maintenance  schedule for each piece of Equipment
subject to this Lease.

     13. Taxes and  Assessments.  Lessee shall  reimburse  Lessor for all taxes,
excise taxes, business privilege taxes, rental taxes, license or franchise fees,
personal  property  taxes,  assessments,  and  any and  all  other  governmental
charges,  fees, fines,  penalties or levies whatsoever  whether  assessable with
respect to the Equipment,  whether  payable by Lessor or Lessee  relating to the
Equipment or the use, rental, transportation or delivery or operation thereof or
of any cargo carried thereby; provided, however, that Lessor shall have the sole
obligation  to pay,  and shall pay, the Arizona  motor  carrier tax, the federal
highway  use tax and  all  use  taxes  levied  with  respect  to the  Equipment,
including the use tax payable on purchase of the Equipment.

     14.  Default.  The  occurrence of any one or more of the  following  events
shall constitute a material default under and a breach of this Lease:

          a. Failure by Lessee to pay, when due, the rent provided  herein or to
make any other payment of money required by Lessor.

          b.  Failure to pay,  when due, any tax,  assessment,  premium or other
amount provided herein and designated as the responsibility of Lessee.

          c. Failure to observe or perform any covenant, agreement, condition or
provision of this Lease.

          d. The levy under execution, attachment by legal process, or filing or
creation of the lien against Lessee's interest in the Equipment.

          e.  Lessee  becomes  insolvent,  bankrupt,  or admits in  writing  its
inability  to pay its  debts as they  mature,  or makes  an  assignment  for the
benefit of creditors, or applies for or consents to the appointment of a trustee
or receiver.

          f. The  institution of any  bankruptcy,  reorganization,  arrangement,
insolvency,  or liquidation  proceedings,  or other proceedings for relief under
the  bankruptcy  law, or similar law for the relief of creditors,  by or against
Lessee and, if instituted  against Lessee by another,  such  proceedings are (i)
allowed against it, (ii) consented to by Lessee,  or (iii) not dismissed  within
60 days after the institution of such proceedings.

                                      -3-
<PAGE>
          g.  The   attachment,   execution   or  other   judicial   seizure  of
substantially  all Lessee's assets,  if such seizure is not discharged within 30
days.

     15.  Lessor's  Remedies.  In the event of a default  hereunder which is not
cured within 30 days after the occurrence of such default, Lessor shall have the
right to exercise any one or more of the following remedies:

          a. Terminate this Lease,  by giving Lessee notice of  termination,  in
which event this Lease shall end and all right,  title and interest of Lessee in
the Equipment shall expire and terminate.

          b. Terminate the right of Lessor to the Equipment without  terminating
this Lease by giving  notice to Lessee that Lessee's  right of possession  shall
end as of the date stated in the termination notice.

          c.  Enforce  the  provisions  of this Lease and  protect the rights of
Lessor hereunder by action in law or equity.

          d. Seek any other relief, whether available at law or in equity.

          e. If Lessor  terminates  the right of  Lessee to  possession  without
terminating this Lease,  such termination  shall not release Lessee, in whole or
in  part,  from  Lessee's  obligation  to pay  rent  or any  other  amounts  due
hereunder. In the event of the termination of this Lease, together with Lessor's
termination of Lessee's right to possession, Lessor shall be entitled to recover
all rent due as of the time of termination,  all expenses required to be paid by
Lessee  through the date of  termination,  plus any and all  damages  Lessor may
incur.

          f. In the event of any  default  under this  Lease,  Lessee  shall pay
Lessor's costs, charges and expenses,  including reasonable costs and attorney's
fees, and any costs of court,  including  expert's fees and accounting  fees. In
the  event of any  default  hereunder,  Lessor  shall  have  the  right to enter
Lessee's premises and reclaim possession of the Equipment.

     16.  Waivers.  Lessor may waive any default  hereunder  without waiving any
other then  existing or future  default.  All remedies of Lessor  hereunder  are
cumulative  and are in addition  to any other  remedies  available  at law or in
equity  that Lessor may have and Lessor  may,  to the extent  permitted  by law,
exercise  such  remedies  concurrently  or  separately,  and exercise of any one
remedy shall not be deemed an election of such a remedy to preclude the exercise
of any other remedy.

     17.  Legal  Costs and  Attorneys'  Fees.  In the event suit or other  legal
action is initiated by either party to enforce its rights  hereunder,  the party
who does not  prevail  agrees  to pay to the  prevailing  party  its  reasonable
attorneys' fees and costs of court.

                                      -4-
<PAGE>
     18. Time. Time is of the essence of this Lease and every covenant, term and
condition hereof.

     19.  Controlling  Law. The  substantive  laws of the State of Arizona shall
govern the validity,  performance  and enforcement of this Lease without respect
to any choice of law provisions.

     20.  Notices.  Any notice required to be given under this Lease shall be in
writing and may be delivered  personally  or by courier or sent by United States
mail,  postage  prepaid,  addressed  to the party at the  address  shown in this
Lease,  unless a written  notice of change of address is given,  in which  event
notice shall be sent to the address given in such change.  Any notice,  which is
mailed  in  accordance  with  the  preceding  sentence,  shall be  deemed  to be
delivered  three  business  days after the date such notice is  deposited in the
United States mail, postage prepaid.

     21.  Counterparts  and  Supersession.  This Lease may be executed in one or
more  counterparts  and,  when so executed,  those  executed  counterpart  shall
constitute a single, binding agreement between and among those parties signatory
thereto.  This Lease amends and  supersedes all prior  equipment  leases between
Lessor and Lessee.

     DATED this 28th day of October, 1998.

                                       LESSOR:

                                       QUAD-K LEASING, INC.,
                                       an Arizona corporation,

                                       By /s/ Kevin P. Knight
                                       -----------------------------

                                       Its President
                                       --------------------------

                                       By /s/ Clark Jenkins
                                       -----------------------------

                                       Its Secretary
                                       --------------------------

                                       LESSEE:

                                       KNIGHT TRANSPORTATION INDIANAPOLIS, INC.,
                                       an Arizona corporation

                                       By /s/ Kevin P. Knight
                                       -----------------------------

                                       Its President
                                       --------------------------

                                      -5-
<PAGE>
                                    EXHIBIT A

     All  Lessor's  tractors and  trailers,  as more  particularly  reflected on
Lessor's records.

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