Document:

EXHIBIT 10.21
             Severance Agreement and Mutual General Release between
                     NBT Bancorp Inc. and John W. Reuther.

<PAGE>

                 SEVERANCE AGREEMENT AND MUTUAL GENERAL RELEASE

         This is a Severance Agreement and Mutual General Release ("Agreement")
between NBT Bancorp, Inc. ("NBTB") and John W. Reuther ("Executive").  In
consideration of the mutual promises and commitments made herein, and intending
to be legally bound hereby, NBTB and Executive agree as follows:

         1. Effective at 11:59p.m. on January 26, 2001, Executive has elected to
retire  and  resign  voluntarily  from all  positions  he holds as an officer of
NBTB's  Pennsylvania  banking  operations,  which is (or will be) doing business
under the name of Pennstar Bank,  N.A., and in accordance with the provisions of
his employment  agreement,  dated July 1, 2000.  Executive further  acknowledges
that, as a result of his retirement,  his employment  relationship with NBTB and
Pennstar  Bank will be  permanently  and  irrevocably  severed and that NBTB and
Pennstar Bank will have no obligation,  contractual  or otherwise,  to rehire or
reinstate him after January 26, 2001.

         2. NBTB and Executive agree that the Executive may continue,  after his
retirement, to serve as a director of Pennstar Bank, N.A. Furthermore, after the
effective date of the merger of Pennstar  Bank,  N.A. with and into Nystar Bank,
N.A.,  NBTB and  Executive  agree that the  Executive  may  continue as the Vice
Chairman  and a  director  of  Pennstar  Bank,  which  will be the  Pennsylvania
division of Nystar Bank,  N.A. As such,  Executive  shall be entitled to receive
directors'  fees and  other  such  compensation  as set by NBTB.  The  Executive
understands and agrees that he will not be a member of the Board of Directors of
Nystar Bank, N.A. after its merger with Pennstar Bank, N.A.

         3.  NBTB  agrees  to pay  Executive  by wire  transfer  in  immediately
available  funds to an account  designated  by  Executive on January 26, 2001 or
seven (7) days after  execution  of this  Agreement by  Executive,  whichever is
later, the following:

         A.       one million two hundred thousand dollars ($1,200,000); and
         B.       an amount equal to Executive's normal bonus payout under his
                  existing employment agreement for the calendar year
                  2000, if not received prior to January 26, 2001.

         Furthermore,  NBTB will transfer title to the automobile currently used
by  Executive  on January  26,  2001 or seven (7) days after  execution  of this
Agreement  by  Executive,  whichever  is later,  and will  continue in force the
medical health  insurance  benefit  program for Executive,  that is in effect on
January 26, 2001, until Executive reaches the age of sixty-two (62) years.

         Executive  will also be entitled  to receive no later than  January 26,
2001,  a grant of stock  options  pursuant to the NBT Bancorp,  Inc.  1993 Stock
Option Plan in accordance with his existing employment agreement.

<PAGE>

         NBTB shall pay the  membership  fee for the  Executive  in the Elmhurst
Country  Club for the years  2001,  2002 and 2003.  NBTB shall not pay any other
expenses  incurred by the  Executive in  connection  with his  activities at the
Elmhurst Country Club.

         4. Executive acknowledges and agrees that, except for the payment under
paragraphs 3A and 3B, he is responsible  for the payments of all federal,  state
and local estimated quarterly income tax payments for the blue-book value of the
automobile as determined by NBTB.

         5. Nothing in this Agreement shall affect Executive's vested portion of
his account in NBTB's employee benefit and retirement programs.  Nothing in this
Agreement  shall  affect  Executive's  rights  under the Pioneer  American  Bank
Executive  Retirement Plan, dated October 25, 1988 (effective back to January 1,
1988) or the Split Dollar  Agreement,  dated April 16, 1999.  NBTB and Executive
agree that the terms and provisions of Executive's current employment  agreement
shall  remain in full force and effect up to and  including  January  26,  2001,
except that Executive  agrees to renounce any right to the payment of any salary
to him for the  period  from  January 1 to  January  26,  2001 and any  vacation
accrual that may be earned for the  calendar  year 2001 and in exchange for such
renouncement,  NBTB shall award the  Executive,  on December 31, 2000,  eighteen
additional vacation days to be used by the Executive in January 2001. NBTB shall
pay the Executive for these  vacation days at his current rate of  compensation.
Executive specifically acknowledges that this current employment agreement shall
be null and void as of January 27, 2001.

         6.A.  Executive  acknowledges that certain business  methods,  creative
techniques, and technical data of NBTB, its subsidiaries, and its affiliates and
the  like  are  deemed  by  NBTB to be and  are in  fact  confidential  business
information  of NBTB,  its  subsidiaries  or its  affiliates or are entrusted to
third  parties.  Such  confidential  information  includes but is not limited to
procedures, methods, sales relationships developed while in the service of NBTB,
its   subsidiaries  or  its   affiliates,   knowledge  of  customers  and  their
requirements,  marketing plans, marketing information,  studies,  forecasts, and
surveys,  competitive  analyses,  mailing  and  marketing  lists,  new  business
proposals, lists of vendors,  consultants,  and other persons who render service
or  provide  material  to  NBTB,  its  subsidiaries  or  their  affiliates,  and
compositions,  ideas,  plans, and methods belonging to or related to the affairs
of NBTB, its  subsidiaries,  or their affiliates.  In this regard,  NBTB asserts
proprietary  rights  in  all  of  its  business  information  and  that  of  its
subsidiaries  or  affiliates,  except for such  information as is clearly in the
public  domain.  Notwithstanding  the  foregoing,   information  that  would  be
generally known or available to persons  skilled in Executive's  fields shall be
considered  to be  "clearly  in the  public  domain"  for  the  purposes  of the
preceding sentence. Executive agrees that he will not disclose or divulge to any
third  party,  except  as may be  required  by his  duties  hereunder,  by  law,
regulation, or order of a court or government authority, or as directed by NBTB,
nor shall he use to the detriment of NBTB, its  subsidiaries,  or its affiliates
or use  in any  business  or on  behalf  of any  business  competitive  with  or
substantially  similar  to any  business  of NBTB,  its  subsidiaries,  or their
affiliates any confidential  business  information obtained during the course of
his employment with NBTB, its  subsidiaries  or affiliates.  The foregoing shall

<PAGE>

not be construed as restricting  Executive from disclosing  such  information to
the employees of NBTB, its subsidiaries, or their affiliates.

         B.  Executive  hereby  agrees that from January 27, 2001 to January 26,
2003,  Executive will not (i) engage in the business activities that NBTB or any
of its  subsidiaries  and affiliates  are engaged in on January 27, 2001,  other
than on behalf of NBTB, its subsidiaries or their  affiliates  within the Market
Area (as hereinafter defined); (ii) directly or indirectly own, manage, operate,
control,  be employed by, or provide  management or  consulting  services in any
capacity  to any firm,  corporation,  or other  entity  (other  than  NBTB,  its
subsidiaries or their affiliates)  engaged in the banking business in the Market
Area; or (iii) directly or indirectly solicit or otherwise  intentionally  cause
any person known to Executive to be an employee, officer, or member of the Board
of Directors of Nystar Bank,  N.A. or a director of Pennstar Bank, a division of
Nystar Bank, N.A. or any of their affiliates to engage in any action  prohibited
under (i) or (ii) of this paragraph 6B; provided that the ownership by Executive
as an investor of not more than five percent of the outstanding  shares of stock
of any  corporation,  or the  shares of any  investment  company  as  defined in
section 3 of the Investment Company Act of 1940, as amended, shall not in itself
constitute a violation of Executives obligations under this paragraph 6B.

         C.  Executive  acknowledges  and agrees  that  irreparable  injury will
result  to  NBTB in the  event  of a  breach  of any of the  provisions  of this
paragraph 6 (the  "Designated  Provisions")  and that NBTB will have no adequate
remedy at law with  respect  thereto.  Accordingly,  in the event of a  material
breach of any  Designated  Provision,  and in  addition  to any  other  legal or
equitable  remedy  NBTB may  have,  NBTB  shall be  entitled  to the  entry of a
preliminary and permanent injunction  (including,  without limitation,  specific
performance)  by  a  court  of  competent  jurisdiction  in  Lackawanna  County,
Pennsylvania,  or  elsewhere,  to restrain the  violation  or breach  thereof by
Executive,  and Executive  submits to the jurisdiction of such court in any such
action.

         D. It is the desire and intent of the parties  that the  provisions  of
this paragraph 6 shall be enforced to the fullest extent  permissible  under the
laws and public policies  applied in each  jurisdiction in which  enforcement is
sought.  Accordingly,  if any particular  provision of this paragraph 6 shall be
adjudicated  to be  invalid or  unenforceable,  such  provision  shall be deemed
amended  to delete  therefrom  the  portion  thus  adjudicated  to be invalid or
unenforceable, such deletion to apply only with respect to the operation of such
provision in the particular  jurisdiction in which such adjudication is made. In
addition,  should any court  determine  that the  provisions of this paragraph 6
shall be unenforceable with respect to scope, duration, or geographic area, such
court shall be empowered to substitute,  to the extent  enforceable,  provisions
similar  hereto or other  provisions  so as to provide to NBTB,  to the  fullest
extent permitted by applicable law, the benefits intended by this paragraph 6.

         E.  As used  herein,  "Market  Area"  shall  mean  the  area  or  areas
delineated  by  circles  formed by radii  extending  twenty-five  miles from (i)
Scranton,  Pennsylvania,  (ii) the authorized branches of Pennstar Bank, N.A. or
Pennstar Bank, a division of Nystar Bank,  N.A., as the case may be, as they may
exist  from time to time,  and (iii)  each  branch of a  depository  institution

<PAGE>

affiliated with NBTB for which Executive has or has had significant executive or
managerial responsibilities.

         7. If all or any portion of the amounts payable to Executive under this
Agreement,  either alone or together with other payments which Executive has the
right to receive from NBTB,  constitute  "excess parachute  payments" within the
meaning of Section 280G of the  Internal  Revenue Code of 1986 (the "Code") that
are  subject  to the excise  tax  imposed  by  Section  4999 of the Code (or any
successor  sections),  NBTB shall increase the amounts payable  hereunder to the
extent  necessary to place Executive in the same after-tax  position as he would
have been in had no such excise tax been imposed on the payments hereunder.  The
determination  of the  amount  of any  such  excise  taxes  shall be made by the
independent accounting firm retained by NBTB.

                  If  at a  later  date  it is  determined  (pursuant  to  final
regulations  or  published  rulings of the  Internal  Revenue  Service  ("IRS"),
assessment by the IRS or  otherwise)  that the amount of excise taxes payable by
Executive is greater than the amount  initially so  determined,  then NBTB shall
pay  Executive an amount equal to the sum of (A) such  additional  excise taxes,
plus (B) any  interest,  fines and  penalties  with  respect to such  additional
excise  taxes,  plus (C) the amount  necessary  to reimburse  Executive  for any
income,  excise or other taxes payable by Executive  with respect to the amounts
specified  in (A) and (B) above and the  reimbursement  provided  by this clause
(C).

         8. In consideration for NBTB's commitments hereunder,  Executive hereby
remises,  releases and forever  discharges NBTB and each and all of its past and
present subsidiaries, parent and related corporations,  companies and divisions,
and its past and present directors,  trustees, officers, managers,  supervisors,
employees, attorneys, and agents, and their predecessors, successors and assigns
(referred to  collectively in this Agreement as  "Releasees"),  from any and all
claims,  debts,  agreements,   complaints  or  causes  of  action  (hereinafter,
collectively, "claims"), whether known or unknown, that he ever had, now has, or
hereafter can, shall or may have against any or all of the Releasees, for, upon,
or by reason of any cause,  matter,  thing or event whatsoever  occurring at any
time from the date of  Executive's  birth up to and including  January 26, 2001.
Executive  acknowledges  and understands  that the claims being released in this
paragraph include, but are not limited to: (i) any claim based on contract or in
tort or common law; (ii) any claim based on or arising under any civil rights or
employment  discrimination  laws,  such as the  Federal  Age  Discrimination  in
Employment Act (29 U.S.C. ss. 621 ET SEQ.) (hereinafter,  "ADEA"),  Title VII of
the Civil Rights Act of 1964 (42 U.S.C.  ss. 2000e ET seq.), or the Pennsylvania
Human  Relations  Act (42 P.S.  ss.  951 ET SEQ.);  (iii) any claim  based on or
arising under any employment related law, such as the Employee Retirement Income
Security Act of 1974, as amended (29 U.S.C.  ss. 301 ET SEQ.), the Equal Pay Act
(29 U.S.C. ss. 201 ET SEQ.), the Americans With  Disabilities Act (42 U.S.C. ss.
12101 ET SEQ.),  the Family and Medical Leave Act (29 U.S.C.  ss. 2601 ET SEQ.),
or the Fair Labor  Standards Act, as amended (29 U.S.C.  ss. 201 ET SEQ.);  (iv)
any claim based on or arising out of Executive's employment by NBTB and Pennstar
Bank and their  predecessors  and/or his  resignation  therefrom  including  any
claims  pursuant to his  employment  agreement  dated July 1, 2000; and (iv) any

<PAGE>

claims for compensatory,  liquidated or punitive damages,  damages for emotional
distress,  back pay,  front pay, and benefits.  In addition,  effective upon the
eighth day following  execution of this Agreement by Executive,  Executive shall
have hereby waived any and all claims,  whether  known or unknown,  that he ever
had, now has, or hereafter  can,  shall or may have under the  Change-in-Control
Agreement, as that term is defined in the Executive's employment agreement dated
July 1, 2000. Executive  understands that, by signing this Agreement,  he waives
all claims he ever had, now has, or may have against any of the Releasees.  NBTB
does hereby  remise,  release and forever  discharge  Executive from any and all
claims,  debts,  agreements,  complaints,  liabilities,  payments,  accountings,
actions and causes of action, whatsoever,  whether known or unknown, at the date
and time Executive executes this Agreement,  that NBTB does, shall or might have
against Executive,  for, upon or by reason of any cause,  matter, thing or event
whatsoever  occurring  at any time  from the  date of  Executive's  birth to and
including the date and time he executes this Agreement.  NBTB understands  that,
by the  execution of this  Agreement by an authorized  officer,  NBTB waives all
claims it ever had, now have, or may have against Executive,  including, but not
limited to, claims arising out of his  employment  prior to the date and time he
executes this  Agreement.  This release does not apply to the  requirements  and
obligations contained within this Agreement.

         9.  Executive  further  covenants  and  agrees  not to  sue  any of the
Releasees  for any claims  released  hereunder,  nor to assert  any such  claims
against  any of the  Releasees  for any  purpose.  Any claim for a breach of any
provision  of this  Agreement  may be remedied  only by a lawsuit to enforce the
Agreement and will not invalidate any party's release of claims.

         10. Executive agrees that the terms of this Agreement are confidential,
and that he will not  disclose or publicize  the terms of this  Agreement or the
amounts  paid or agreed to be paid  pursuant to this  Agreement to any person or
entity, except to his attorney or accountant,  or to a government agency for the
purposes of the payment or collection of taxes or application  for  unemployment
compensation.  NBTB agrees that the terms of this Agreement are confidential and
they will not  knowingly  disclose  or  publicize  (or  knowingly  permit  their
employees to disclose or  publicize)  the terms of this  Agreement or the amount
paid pursuant to this  Agreement to any person or entity except their  officers,
directors, attorneys or accountants, or to a government agency or representative
thereof;  provided,  however,  that  NBTB  does not  guarantee  that none of its
employees  will not  make  any such  disclosure  or  publication;  and  provided
further, that NBTB reserves the right to disclose the terms of this Agreement in
any  filing  required  under  the rules and  regulations  promulgated  under the
Securities  Exchange  Act of  1934 by the  Securities  and  Exchange  Commission
("SEC") if, in the opinion of NBTB's counsel,  such disclosure is required under
such rules and regulations of the SEC.

         11. All executed  copies of this Agreement,  and  photocopies  thereof,
shall  have the same  force and  effect  and  shall be as  legally  binding  and
enforceable as the original.

         12. All provisions of this Agreement are severable,  and if any of them
is  determined  to be invalid or  unenforceable  for any reason,  the  remaining

<PAGE>

provisions and portions of this Agreement shall be unaffected  thereby and shall
remain in full force to the fullest extent permitted by law.

         13.  This  Agreement  is binding on  Executive  and on his  successors,
administrators, heirs and assigns, and inures to the benefit of each of NBTB and
the   Releasees   and  their   successors,   predecessors,   heirs,   executors,
administrators or assigns, as the case may be.

         14.  Executive  acknowledges  that he has been advised of his rights to
consult  with an attorney  before  signing this  Agreement  and that he has been
encouraged  to do so.  Consequently,  he has  been  represented  by  independent
counsel in this matter.

         15. Executive makes the following  additional  representations to NBTB,
each  of  which  is  significant  and  an  important  consideration  for  NBTB's
willingness to enter into the Agreement:

                  A.       Executive expressly acknowledges that if he did not
execute the Agreement, he would not be entitled to receive the money set forth
in paragraph 3 A.

                  B.  Executive  acknowledges  that he has been given a full and
fair  opportunity to review the Agreement.  NBTB  specifically  recommended that
Executive  consult with an attorney before  executing the Agreement,  and he has
been  allowed  up to  twenty-one  (21) days to  consider  whether  to accept the
Agreement.  Executive acknowledges that he is signing this Agreement voluntarily
and of his own free will, with full knowledge of the nature and  consequences of
its terms.

                  C.  Executive  understands  that he may change  his mind,  not
retire and revoke the  Agreement  at any time during the seven (7) days after he
signs the Agreement,  provided he does so in writing,  in which case none of the
provisions of the Agreement will have any effect.  Executive understands that he
will not be entitled to receive any payments under the Agreement until the seven
(7) day revocation period has expired without revocation of the Agreement.

         16. By entering into this Agreement, NBTB does not admit that it or any
of its employees  violated any law or any legal right of Executive and, in fact,
NBTB expressly denies liability. NBTB is entering into this Agreement solely for
the  purpose of  effectuating  a mutually  satisfactory  retirement  benefit for
Executive  and,  therefore,  Executive's  termination  of his  positions,  as an
officer of NBTB and the Pennstar Bank, N.A.

         17. By entering into this Agreement, neither Executive, nor NBTB admits
that he or they, or any of their  employees,  violated any law or legal right of
the other,  and,  in fact,  Executive,  and NBTB  expressly  deny  liability  or
responsibility.  They are entering into this Agreement solely for the purpose of
effectuating a mutual satisfactory severance of Executive's employment with, and
termination of his positions as an officer of NBTB.

<PAGE>

         18. The Agreement and all acts and transactions  contemplated hereunder
shall be governed,  construed and interpreted in accordance with the laws of the
Commonwealth of Pennsylvania, without regard to principles of conflict of laws.

         19.      Each party shall be responsible for its own attorneys' fees.

<PAGE>

         20.      This is the complete and final agreement between the parties
and supersedes all prior or contemporaneous agreements, employment offers,
negotiations or retirement discussions.

                                           NBT BANCORP, INC.

By:  /S/ John W. Reuther                   By:  /S/ Daryl R. Forsythe
     John W. Reuther                       Daryl R. Forsythe,
                                           President and Chief Executive Officer
     Date:  November 10, 2000              Date:  November __, 2000

<PAGE>Exhibit 1

                                MERGER AGREEMENT

                                      AMONG

                         SWIFT TRANSPORTATION CO., INC.,
                              a Nevada corporation

                                SUN MERGER, INC.,
                             a Tennessee corporation

                                       AND

                              M. S. CARRIERS, INC.,
                             a Tennessee corporation

                                December 11, 2000
<PAGE>
                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----
1. Definitions...............................................................  1

2. Basic Transaction.........................................................  6
    (a) The Merger...........................................................  7
    (b) The Closing..........................................................  7
    (c) Actions at the Closing...............................................  7
    (d) Effect of Merger.....................................................  7
    (e) Procedure for Payment................................................ 10

3. Representations and Warranties of the Parent and the Merger Sub........... 12
    (a) Organization, Qualification, and Corporate Power..................... 12
    (b) Capitalization....................................................... 13
    (c) Authorization of Transaction......................................... 15
    (d) Noncontravention..................................................... 15
    (e) Company Public Reports............................................... 15
    (f) Financial Statements................................................. 16
    (g) Events Subsequent to Most Recent Fiscal Quarter End.................. 16
    (h) Undisclosed Liabilities.............................................. 16
    (i) Brokers' Fees........................................................ 16
    (j) Disclosure........................................................... 16
    (k) Employee Benefit Plans............................................... 17
    (l) Employment and Labor Matters......................................... 19
    (m) Environmental Matters................................................ 20
    (n) Takeover Statutes.................................................... 22
    (o) Tax Matters.......................................................... 23
    (p) Insurance Bonds...................................................... 24
    (q) Compliance........................................................... 25
    (r) Absence of Litigation................................................ 25
    (s) Title to Assets...................................................... 25
    (t) Pooling-Tax Matters.................................................. 25
    (u) Opinion of Financial Advisor......................................... 26
    (v) Material Agreements.................................................. 26
    (w) Intellectual Property................................................ 27

4. Representations and Warranties of the Parent and the Merger Sub........... 27
    (a) Organization, Qualification, and Corporate Power..................... 27
    (b) Capitalization....................................................... 28
    (c) Authorization of Transaction......................................... 30
    (d) Noncontravention..................................................... 30
    (e) Parent Public Reports................................................ 30

                                       i
<PAGE>
    (f) Financial Statements................................................. 31
    (g) Events Subsequent to Most Recent Fiscal Quarter End.................. 31
    (h) Undisclosed Liabilities.............................................. 31
    (i) Brokers' Fees........................................................ 31
    (j) Disclosure........................................................... 31
    (k) Employee Benefit Plans............................................... 32
    (l) Employment and Labor Matters......................................... 34
    (m) Environmental Matters................................................ 35
    (n) Material Agreements.................................................. 37
    (o) Tax Matters.......................................................... 37
    (p) Insurance Bonds...................................................... 38
    (q) Compliance........................................................... 39
    (r) Absence of Litigation................................................ 39
    (s) Title to Assets...................................................... 40
    (t) Pooling-Tax Matters.................................................. 40
    (u) Intellectual Property................................................ 40

5. Covenants................................................................. 41
    (a) General.............................................................. 41
    (b) Conduct of Business by the Parent Pending the Merger................. 41
    (c) Conduct of Business by the Company Pending the Merger................ 44
    (d) Registration Statement; Proxy Statement.............................. 46
    (e) Shareholders Meeting................................................. 48
    (f) Additional Shareholder Meeting Matters............................... 48
    (g) Access to Information................................................ 48
    (h) Other Offers......................................................... 49
    (i) Pooling; Reorganization.............................................. 51
    (j) Notification of Certain Matters...................................... 52
    (k) Listing on the Nasdaq National Market................................ 53
    (l) Public Announcements................................................. 53
    (m) Takeover Laws........................................................ 53
    (n) Accountant's Letters................................................. 53
    (o) Additional Parent Directors.......................................... 54
    (p) Hart-Scott-Rodino Act................................................ 54
    (q) Company Stock Options and Company Stock Plans;
          Outstanding Company Stock Options.................................. 54
    (r) Insurance and Indemnification........................................ 56

6. Conditions to Obligation to Close......................................... 57
    (a) Conditions to Obligation of the Parent and the Merger Sub............ 57
    (b) Conditions to Obligation of the Company.............................. 59

                                       ii
<PAGE>
7. Termination............................................................... 61
    (a) Termination of Agreement............................................. 63
    (b) Effect of Termination................................................ 63
    (c) Fees and Expenses.................................................... 63

8. Miscellaneous............................................................. 64
    (a) Survival............................................................. 64
    (b) Reserved............................................................. 64
    (c) No Third-Party Beneficiaries......................................... 64
    (d) Entire Agreement..................................................... 64
    (e) Succession and Assignment............................................ 64
    (f) Counterparts......................................................... 64
    (g) Headings............................................................. 64
    (h) Notices.............................................................. 64
    (i) Governing Law........................................................ 65
    (j) Amendments and Waivers............................................... 65
    (k) Severability......................................................... 65
    (l) Expenses............................................................. 67
    (m) Incorporation of Exhibits and Schedules.............................. 67
          Exhibit A-1 - Voting Agreement (Parent)
          Exhibit A-2 - Voting Agreement (Company)
          Exhibit B - Articles of Merger
          Exhibit C - Company Disclosure Schedule
          Exhibit D - Parent Disclosure Schedule
          Exhibit E - Form of Affiliate Pooling Agreement
          Exhibit F-1 - Employment Agreement
          Exhibit F-2 - Employment Agreement
          Exhibit F-3 - Employment Agreement
          Exhibit F-4 - Employment Agreement

                                      iii
<PAGE>
     THIS MERGER  AGREEMENT  (this  "Agreement")  is made and entered into as of
December  11,  2000,  by and among  Swift  Transportation  Co.,  Inc.,  a Nevada
corporation  (the  "Parent"),  Sun Merger,  Inc., a Tennessee  corporation and a
wholly-owned  Subsidiary of the Parent (the "Merger  Sub"),  and M. S. Carriers,
Inc., a Tennessee  corporation (the "Company").  The Parent, the Merger Sub, and
the Company are referred to herein  individually  as a "Party" and  collectively
herein as the "Parties."

     WHEREAS, the Boards of Directors of Parent, Merger Sub and the Company have
each  determined  that  it  is  in  the  best  interests  of  their   respective
stockholders  (the  "Stockholders")  for Parent to  participate in the merger of
Merger Sub with and into the Company (the  "Merger")  upon the terms and subject
to the conditions set forth herein;

     WHEREAS,  in furtherance of the Merger,  the Boards of Directors of Parent,
Merger Sub and the Company have each approved the Merger in accordance  with the
Tennessee  Business  Corporation  Act and  subject to the  conditions  set forth
herein,  which Merger will result in, among other things, the Company becoming a
wholly owned Subsidiary of Parent;

     WHEREAS,  as a  condition  to the  willingness  of, and an  inducement  to,
Parent,   Merger   Sub,   and  the   Company  to  enter  into  this   Agreement,
contemporaneously  with the  execution and delivery of this  Agreement,  certain
holders of Parent Shares and Company Shares are entering into  agreements  dated
as of the date hereof (the  "Voting  Agreements"),  in the forms of Exhibits A-1
and A-2 attached hereto, respectively, providing for certain actions relating to
the transactions contemplated by this Agreement;

     WHEREAS,  for federal  income tax purposes,  it is intended that the Merger
shall qualify as a tax-free  reorganization within the meaning of Section 368(a)
of the Internal Revenue Code of 1986, as amended (the "Code"); and

     WHEREAS,  for  accounting  purposes,  it is intended  that the Merger shall
qualify for pooling-of-interests treatment.

     Now,  therefore,  in  consideration of the premises and the mutual promises
herein  made,  and in  consideration  of the  representations,  warranties,  and
covenants herein contained, the Parties agree as follows.

1.   DEFINITIONS. For purposes of this Agreement, the following terms shall have
     the meanings set forth below:

     "Acquisition Proposal" has the meaning set forth in Section 5(h)(i) below.
<PAGE>
     "Affiliate"  has the  meaning  set forth in Rule  12b-2 of the  regulations
promulgated under the Securities Exchange Act.

     "Agreement" has the meaning set forth in the preface above.

     "Alternative  Transaction"  has the meaning  set forth in Section  5(h)(vi)
below.

     "Articles of Merger" has the meaning set forth in Section 2(c) below.

     "Authority"  means  each and  every  federal,  state,  local,  and  foreign
judicial, governmental,  quasi-governmental,  or regulatory agency, official, or
department;  every arbitrator,  mediator,  and other similar official; and every
other  entity to whose  jurisdiction  or decision  making  authority a Party has
submitted.

     "Benefit  Plan" means all contracts,  plans,  arrangements,  policies,  and
understandings  providing for any  compensation or benefit other than base wages
or salaries  that are  maintained  by a Person or affect either its employees or
independent  contractors,  regardless of whether defined as an "employee benefit
plan"  under  ERISA or subject to any  provision  of ERISA,  including,  without
limitation: all pension,  profit-sharing,  retirement, thrift, 401(k), ESOP, and
other similar plans and arrangements (defined benefit and defined contribution);
all  health  and  welfare,  disability,  insurance  (including  self-insurance),
workers'  compensation,  supplemental  unemployment,  severance,  vacation,  and
similar  plans  and  arrangements;   and  all  bonus,  stock  option,  incentive
compensation,  stock  appreciation  rights,  phantom stock,  overtime  guaranty,
employment contract, employee handbook, and other similar plans or arrangements.
A "Company  Benefit  Plan" is a Benefit  Plan that relates to the Company or the
employees and  independent  contractors of the Company and its  Subsidiaries.  A
"Parent  Benefit  Plan" is a Benefit  Plan  that  relates  to the  Parent or the
employees and independent contractors of the Parent and its Subsidiaries.

     "Certificates" has the meaning set forth in Section 2(e)(iii) below.

     "Charter"  means  charter,   articles  of  incorporation,   certificate  of
incorporation or similar documents.

     "Claim" has the meaning set forth in Section 5(r)(ii) below.

     "Closing" has the meaning set forth in Section 2(b) below.

     "Closing Date" has the meaning set forth in Section 2(b) below.

     "Code" has the meaning set forth in the recitals.

     "Company" has the meaning set forth in the preface above.

                                       2
<PAGE>
     "Company  Affiliate Pooling Agreement" has the meaning set forth in Section
5(i)(iii) below.

     "Company Base Year" has the meaning set forth in Section 3(p) below.

     "Company Disclosure Schedule" has the meaning set forth in Section 3 below.

     "Company  Material  Agreements"  has the meaning set forth in Section  3(v)
below.

     "Company  Materially  Adverse  Effect" has the meaning set forth in Section
3(a) below.

     "Company Public Reports" has the meaning set forth in Section 3(e) below.

     "Company  Share"  means any share of the common  stock,  $.01 par value per
share, of the Company.

     "Company  Special  Meeting"  has the meaning  set forth in Section  5(d)(i)
below.

     "Company  Stock Option Plans" has the meaning set forth in Section  3(b)(i)
below.

     "Company  Stockholder"  means any  Person  who or which  holds any  Company
Shares.

     "D&O Insurance" has the meaning set forth in Section 5(r)(iv) below.

     "Definitive Proxy Materials" means the definitive proxy materials  relating
to the Special Meetings.

     "Disclosure Schedules" means the Company Disclosure Schedule and the Parent
Disclosure Schedule.

     "Effective Time" has the meaning set forth in Section 2(d)(i) below.

     "Employment Agreements" has the meaning set forth in Section 5(s) below.

     "Environmental Laws" has the meaning set forth in Section 3(m) below.

     "Environmental Permit" has the meaning set forth in Section 3(m) below.

     "ERISA Affiliate" has the meaning set forth in Section 3(k)(v) below.

     "Exchange Agent" has the meaning set forth in Section 2(e)(i) below.

     "Fairness Opinion" has the meaning set forth in Section 3(i) below.

     "Fiduciary Finding" has the meaning set forth in Section 5(h)(i) below.

                                       3
<PAGE>
     "GAAP" means United States generally accepted  accounting  principles as in
effect from time to time.

     "Hart-Scott-Rodino Act" means the Hart-Scott-Rodino  Antitrust Improvements
Act of 1976, as amended.

     "Hazardous Materials" has the meaning set forth in Section 3(m) below.

     "Indemnified Party" has the meaning set forth in Section 5(r)(ii) below.

     "Intellectual Property" has the meaning set forth in Section 3(w) below.

     "IRS" has the meaning set forth in Section 3(k) below.

     "Joint Proxy Statement" has the meaning set forth in Section 5(d)(i) below.

     "Knowledge,"  as to each of the  Parent and the  Company,  means the actual
knowledge of such entity's executive officers after reasonable investigation.

     "Law" means any constitution,  statute, law, ordinance,  rule,  regulation,
Order,  judgment,  injunction,  decree,  ruling,  or other  pronouncement by any
Authority (including,  without limitation,  the following types:  environmental,
energy,  safety,  health, zoning,  anti-discrimination,  antitrust,  employment,
transportation, tax, and employee benefit (including ERISA)).

     "Lien" means any mortgage,  lien, pledge, security interest,  mechanics' or
materialmens' or similar lien, conditional sale agreement, charge, claim, right,
condition,  restriction,  or other  encumbrance or defect of title of any nature
whatsoever (including, without limitation, any assessment, charge, or other type
of notice which is levied or given by any  Authority  and for which a lien could
be filed).

     "Litigation" means any claim, suit, action,  arbitration,  cause of action,
claim,  complaint,  criminal  prosecution,   investigation,  demand  letter,  or
proceeding, whether at law or at equity, before or by any Authority.

     "Merger" has the meaning set forth in the recitals.

     "Merger Consideration" has the meaning set forth in Section 2(d)(v) below.

     "Merger Sub" has the meaning set forth in the preface above.

     "Most Recent Fiscal  Quarter End" means at the given time,  the most recent
of September 30, 2000, December 31, 2000, or March 31, 2001.

                                       4
<PAGE>
     "Multiemployer Plan" has the meaning set forth in Section 3(k)(vi) below.

     "Nevada General  Corporation Law" means the Nevada General Corporation Law,
as amended.

     "Order" means any judgment,  order, writ, injunction,  ruling or decree of,
or any settlement under the jurisdiction of, any Authority.

     "Ordinary  Course of  Business"  means  the  ordinary  course  of  business
consistent with past custom and practice (including with respect to quantity and
frequency).

     "Outstanding  Company  Stock  Options" has the meaning set forth in Section
3(b)(i) below.

     "Outstanding  Parent  Stock  Options"  has the meaning set forth in Section
4(b)(i) below.

     "Parent" has the meaning set forth in the preface above.

     "Parent Base Year" has the meaning set forth in Section 4(p) below.

     "Parent Disclosure Schedule" has the meaning set forth in Section 4 below.

     "Parent  Material  Agreement"  has the  meaning  set forth in Section  4(n)
below.

     "Parent  Materially  Adverse  Effect"  has the meaning set forth in Section
4(a) below.

     "Parent Public Reports" has the meaning set forth in Section 4(e) below.

     "Parent  Share"  means any share of the common  stock,  $0.01 par value per
share, of the Parent.

     "Parent  Special  Meeting"  has the  meaning  set forth in Section  5(d)(i)
below.

     "Parent  Stock Option  Plans" has the meaning set forth in Section  4(b)(i)
below.

     "Parties" has the meaning set forth in the preface above.

     "Party" has the meaning set forth in the preface above.

     "Payment Event" has the meaning set forth in Section 5(h)(v) below.

     "Person" means an individual,  partnership,  corporation, limited liability
company, association, joint stock company, trust, joint venture,  unincorporated
organization,  governmental  body  (or  any  department,  agency,  or  political
subdivision thereof), or other entity.

                                       5
<PAGE>
     "Pre-Merger Matters has the meaning set forth in Section 5(r)(ii) below.

     "Registration  Statement"  has the  meaning  set forth in  Section  5(d)(i)
below.

     "Representatives" has the meaning set forth in Section 5(g) below.

     "Requisite  Stockholder Approval" means the affirmative vote of the holders
of a majority of the voting power of outstanding  common stock of (i) the Parent
and  (ii) the  Company,  in each  case as  applicable,  in favor of the  matters
submitted  to the  respective  stockholders  pursuant  to the  Definitive  Proxy
Materials.

     "Returns" the meaning set forth in Section 3(o)(i).

     "SEC" means the Securities and Exchange Commission.

     "Securities Act" means the Securities Act of 1933, as amended.

     "Securities  Exchange  Act" means the  Securities  Exchange Act of 1934, as
amended.

     "Special  Meetings"  means the Company  Special  Meeting  together with the
Parent Special Meeting.

     "Stockholders" has the meaning set forth in the recitals.

     "Stockholders Agreements" has the meaning set forth in the recitals.

     "Subsidiary" means any corporation or other business entity with respect to
which a specified Person (or a Subsidiary  thereof) owns twenty percent (20%) or
more of the common stock or other equity interests or otherwise has the power to
vote or direct  sufficient  voting power to elect a majority of the directors or
other managers.

     "Surviving Corporation" has the meaning set forth in Section 2(a) below.

     "Taxes" or "Tax"  shall mean all taxes,  charges,  fees,  levies,  or other
assessments of whatever kind or nature, including,  without limitation,  all net
income, gross income, gross receipts,  sales, use, ad valorem,  transfer,  fuel,
franchise,   profits,  license,   withholding,   payroll,  employment,   excise,
estimated, severance, stamp, occupancy, or property taxes, customs duties, fees,
assessments,  or charges of any kind whatsoever  (together with any interest and
any  penalties,  additions  to  tax,  or  additional  amounts)  imposed  by  any
Authority.

     "Tennessee   Business   Combination  Act"  means  the  Tennessee   Business
Combination Act, as amended.

     "Tennessee   Business   Corporation  Act"  means  the  Tennessee   Business
Corporation Act, as amended.

                                       6
<PAGE>
     "Third Party" has the meaning set forth in Section 5(h)(vi) below.

2.   BASIC TRANSACTION.

     (a)  THE  MERGER.  On and  subject  to the  terms  and  conditions  of this
          Agreement,  the Merger Sub will merge with and into the Company at the
          Effective  Time.  The Company shall be the  corporation  surviving the
          Merger (the "Surviving Corporation").

     (b)  THE CLOSING.  Unless this Agreement shall have been terminated and the
          transactions  contemplated by this Agreement abandoned pursuant to the
          provisions  of Section 7 and subject to the  provisions  of Section 6,
          the  closing of the  Merger  (the  "Closing")  will take place at noon
          (Eastern  time) on a date (the "Closing  Date") to be mutually  agreed
          upon by the Parties,  which date shall be the third business day after
          all the  conditions  set forth in Section 6 shall have been  satisfied
          (or waived in accordance with Section 6, to the extent the same may be
          waived),  unless  another  time  and/or  date is agreed by the Parties
          hereto.  The Closing  shall take place at the offices of the Parent or
          such other place as the Parties hereto otherwise agree.

     (c)  ACTIONS AT THE CLOSING.  At the Closing,  (i) the Company will deliver
          to  the  Parent  and  the   Merger  Sub  the   various   certificates,
          instruments, and documents referred to in Section 6(a) below, (ii) the
          Parent and the Merger Sub will  deliver  to the  Company  the  various
          certificates,  instruments,  and documents referred to in Section 6(b)
          below,  and (iii) the  Company  and the  Merger Sub will file with the
          Secretary of State of the State of Tennessee Articles of Merger in the
          form attached hereto as Exhibit B (the "Articles of Merger").

     (d)  EFFECT OF MERGER.

           (i) GENERAL.  The  Merger  shall  become  effective  at the time (the
               "Effective  Time") the Articles of Merger are validly  filed with
               the  Secretary  of State of the State of Tennessee by the Company
               and the  Merger  Sub or at such  later  date  and  time as may be
               specified  in the  Articles of Merger by mutual  agreement of the
               Company,  the Parent,  and the Merger Sub.  The Merger shall have
               the effect set forth in the Tennessee  Business  Corporation Act.
               Without  limiting  the  generality  of  the  foregoing,   at  the
               Effective Time, all of the assets, property,  rights, privileges,
               immunities,  powers, and franchises of the Company and Merger Sub
               shall  vest  in  the  Surviving   Corporation,   and  all  debts,
               liabilities,  duties,  and  obligations of the Company and Merger
               Sub shall become the debts,  liabilities,  duties and obligations
               of the Surviving  Corporation.  The Surviving Corporation may, at
               any time after the  Effective  Time,  take any action  (including
               executing and  delivering any document) in the name and on behalf
               of either the Company or the Merger Sub in order to carry out and
               effectuate the transactions contemplated by this Agreement.

                                       7
<PAGE>
          (ii) CERTIFICATE  OF  INCORPORATION.  The  Charter  of  the  Surviving
               Corporation  shall  be  amended  and  restated  at  and as of the
               Effective  Time  to read as did the  Charter  of the  Merger  Sub
               immediately  prior to the Effective Time (except that the name of
               the Surviving Corporation will remain unchanged).

         (iii) BYLAWS. The bylaws of the Surviving  Corporation shall be amended
               and restated at and as of the  Effective  Time to read as did the
               bylaws of the Merger Sub immediately  prior to the Effective Time
               (except that the name of the  Surviving  Corporation  will remain
               unchanged).

          (iv) DIRECTORS  AND  OFFICERS.  The  directors of the Merger Sub shall
               become the  directors of the Surviving  Corporation  at and as of
               the Effective Time, and the officers of the Surviving Corporation
               from and  after  the  Effective  Time  shall  be as set  forth in
               Section 2(d) of the Parent Disclosure Schedule.

           (v) CONVERSION OF COMPANY SHARES.

               (A) At and as of the  Effective  Time,  and without any action on
               the part of the  Parties  hereto  or any  holder  of the  Company
               Shares,  each Company  Share issued and  outstanding  immediately
               prior to the Effective  Time, by virtue of this Merger,  shall be
               converted  automatically  into the right to receive one and seven
               tenths  (1.7)  fully paid and  nonassessable  Parent  Shares (the
               "Merger  Consideration")  subject to the terms and provisions set
               forth in this Section 2.

               (B) Each Company Share issued and outstanding  immediately  prior
               to  the  Effective  Time  shall  automatically  be  redeemed  and
               canceled and shall cease to exist as of the Effective  Time,  and
               each holder of a certificate  representing any such Company Share
               shall cease to have any rights with respect  thereto,  except the
               right to receive the Merger Consideration and any cash in lieu of
               fractional  Parent  Shares to be issued or paid in  consideration
               therefor upon surrender of such  certificate  in accordance  with
               Section 2(d)(ix) hereof, without interest.

               (C) Each Company  Share held in the  treasury of the Company,  if
               any, and each Company  Share,  if any,  owned by Parent or Merger
               Sub, in each case immediately  prior to the Effective Time, shall
               be canceled and extinguished  without any conversion  thereof and
               no payment or distribution shall be made with respect thereto.

                                       8
<PAGE>
          (vi) CONVERSION OF COMPANY STOCK OPTIONS.

               (A) At and as of the  Effective  Time,  and without any action on
               the part of the holder thereof,  each then outstanding  option to
               purchase  Company  Shares  shall be  converted  into an option to
               purchase  Parent  Shares in the manner set forth in Section 5(q);
               provided,  that in any  event  any  such  conversion  shall be in
               accordance  with  the  terms  and  conditions  of all  applicable
               Company Stock Option Plans, option agreements thereunder, and all
               other relevant  documentation  immediately prior to the Effective
               Time.

               (B) The Company and its Board of Directors  shall  promptly  take
               all actions necessary to ensure that following the Effective Time
               no holder of any  options or other  rights  pursuant  to, nor any
               participant in or party to, the Company Stock Option Plans or any
               other Benefit Plan or other plan, program, arrangement, agreement
               or other  commitment  providing  for the issuance or grant of any
               interest  in respect of the  capital  stock of the Company or any
               Subsidiary  of the  Company  will have any rights  thereunder  to
               acquire equity securities,  or any right to payment in respect of
               the equity securities,  of Parent, the Company,  or the Surviving
               Corporation  or any of their  Subsidiaries,  except  as  provided
               herein.

         (vii) ADJUSTMENT OF MERGER  CONSIDERATION.  Without limiting any of the
               provisions of this Agreement,  the Merger  Consideration shall be
               adjusted to reflect fully the effect of any stock split,  reverse
               split, stock dividend  (including any dividend or distribution of
               securities  convertible  into Parent  Shares or Company  Shares),
               reorganization,   recapitalization  or  other  like  change  with
               respect to Parent Shares of Company  Shares  occurring  after the
               date hereof and prior to the Effective Time.

        (viii) CONVERSION OF  CAPITAL STOCK  OF THE MERGER SUB. At and as of the
               Effective  Time,  each share of common stock,  $.01 par value per
               share,  of the Merger Sub shall be converted  automatically  into
               one share of common  stock,  $.01 par  value  per  share,  of the
               Surviving  Corporation and shall thereafter constitute all of the
               issued   and   outstanding   capital   stock  of  the   Surviving
               Corporation.  Each stock  certificate  of Merger  Sub  evidencing
               ownership of any shares of Merger Sub common  stock shall,  after
               the Effective Time,  evidence ownership of such shares of capital
               stock of the Surviving Corporation.

          (ix) FRACTIONAL   SHARES.   No  certificates  or  scrip   representing
               fractional  Parent Shares shall be issued in connection  with the
               Merger, and such fractional  interests will not entitle the owner
               thereof  to any  rights  of a  stockholder  of  Parent.  In  lieu
               thereof,  each  holder of Company  Shares  exchanged  pursuant to
               Section 2(d)(v) or of options or warrants  exchanged  pursuant to

                                       9
<PAGE>
               Section 2(d)(vi) who would otherwise be entitled to a fraction of
               a Parent Share (after aggregating all fractional Parent Shares to
               have been  otherwise  received by such holder) shall receive from
               Parent an amount of cash  (rounded down to the nearest whole cent
               and without  interest)  equal to the  product of such  fractional
               part of a Parent Share  multiplied  by the average  closing price
               per Parent  Share  (rounded  to the  nearest  cent) on the Nasdaq
               National Market (as reported in the Wall Street  Journal,  or, if
               not reported therein,  any other authoritative source selected by
               Parent) for the ten (10)  trading days ending on the date two (2)
               trading days immediately prior to (and excluding the date of) the
               Effective Time.

     (e)  PROCEDURE FOR PAYMENT.

           (i) EXCHANGE  AGENT.  Prior  to  the  Effective  Time,  Parent  shall
               designate a bank or trust company to act as the Exchange Agent in
               the Merger (the "Exchange Agent").

          (ii) PARENT TO PROVIDE PARENT SHARES. When and as needed, Parent shall
               make  available to the Exchange  Agent for exchange in accordance
               with this Section 2, through such reasonable procedures as Parent
               may adopt,  sufficient Parent Shares to be exchanged  pursuant to
               Section 2(d).

         (iii) EXCHANGE  PROCEDURES.  Promptly  after the  Effective  Time,  the
               Surviving  Corporation shall cause to be mailed to each holder of
               record of a certificate or certificates (the "Certificates") that
               represented as of the Effective Time  outstanding  Company Shares
               to be  exchanged  pursuant to Section 2, a letter of  transmittal
               (which shall specify that delivery shall be effected, and risk of
               loss and title to the Certificates shall pass, only upon delivery
               of the  Certificates  to the Exchange  Agent and shall be in such
               form and have such  other  provisions  as Parent  may  reasonably
               specify) and  instructions  for use in effecting the surrender of
               the Certificates in exchange for certificates representing Parent
               Shares.  Upon surrender of a Certificate  to the Exchange  Agent,
               together  with such letter of  transmittal,  duly  completed  and
               validly executed in accordance with the instructions thereto, and
               such  other  documents  as  may  be  required  pursuant  to  such
               instructions, the holder of such Certificate shall be entitled to
               receive in  exchange  therefor  a  certificate  representing  the
               number of whole Parent  Shares and payment in lieu of  fractional
               shares  which such  holder has the right to receive  pursuant  to
               Sections  2(d)(v)  and  2(d)(vi),  after  giving  effect  to  any
               required  Taxes,   and  the  Certificate  so  surrendered   shall
               forthwith be canceled. At any time following six (6) months after
               the Effective  Time,  all or any number of Parent Shares (and any
               or  all  cash  payable  in  lieu  of  fractional  Parent  Shares)
               deposited  with or made  available  to the  Exchange  Agent which
               remain   undistributed   to  the  holders  of  the   Certificates

                                       10
<PAGE>
               representing  Company  Shares,  shall be delivered to Parent upon
               demand, and thereafter such holders of unexchanged Company Shares
               shall be  entitled to look only to Parent  (subject to  abandoned
               property, escheat or other similar Law) only as general creditors
               thereof  with  respect to the Parent  Shares for payment upon due
               surrender of their Certificates.

          (iv) DISTRIBUTIONS WITH RESPECT TO UNEXCHANGED SHARES. No dividends or
               other  distributions  declared or made after the  Effective  Time
               with  respect  to  Parent  Shares  with a record  date  after the
               Effective  Time will be paid to the  holder of any  unsurrendered
               Certificate  with respect to the whole Parent Shares  represented
               thereby  until the  holder of  record of such  Certificate  shall
               surrender such Certificate.  Subject to applicable Law, following
               surrender  of any such  Certificate,  there  shall be paid to the
               record  holder  of the  certificates  representing  whole  Parent
               Shares issued in exchange therefor, without interest, at the time
               of such surrender, the amount of dividends or other distributions
               with a record date after the Effective  Time and payable  between
               the Effective Time and the time of such surrender with respect to
               such whole Parent Shares.

          (v)  TRANSFERS OF OWNERSHIP.  If any  certificate for Parent Shares is
               to be  issued  in a  name  other  than  the  name  in  which  the
               Certificate  surrendered in exchange  therefor is registered,  it
               will  be a  condition  of  the  issuance  thereof  that  (A)  the
               Certificate  so  surrendered   will  be  properly   endorsed  and
               otherwise  in  proper  form for  transfer  and  that  the  Person
               requesting  such  exchange  will have paid any  transfer or other
               Taxes  required by reason of the  issuance of a  certificate  for
               Parent  Shares in a name  other  than the name of the  registered
               holder of the  Certificate  surrendered or (B) established to the
               satisfaction of Parent,  or any agent designated by Parent,  that
               such Taxes have been paid or are not applicable.

          (vi) NO  LIABILITY.  Notwithstanding  anything to the contrary in this
               Agreement,  none of the Exchange Agent,  Parent, or the Surviving
               Corporation  shall be liable to a holder of a Certificate for any
               Parent Shares (and any cash payable for fractional  Parent Shares
               or any other amount due, if any) that was properly delivered to a
               public official  pursuant to any applicable  abandoned  property,
               escheat or similar Law.

         (vii) WITHHOLDING  OF  TAX.  Parent  or  the  Exchange  Agent  will  be
               entitled to deduct and withhold from the consideration  otherwise
               payable  pursuant  to this  Agreement  to any  holder of  Company
               Shares such amounts as Parent (or any  Affiliate  thereof) or the
               Exchange Agent shall determine in good faith they are required to
               deduct and  withhold  with  respect to the making of such payment
               under the Code,  or any  provision  of federal,  state,  local or
               foreign Law. To the extent that amounts are so withheld by Parent
               or the Exchange Agent,  such withheld amounts will be treated for
               all purposes of this  Agreement as having been paid to the holder
               of the  Company  Shares in  respect  of whom such  deduction  and
               withholding were made by Parent.

                                       11
<PAGE>
        (viii) NO  FURTHER  OWNERSHIP  RIGHTS  IN  COMPANY  SHARES.  All  Parent
               Shares issued upon the  surrender for exchange of Company  Shares
               in  accordance  with the terms of this Section 2  (including  any
               cash paid in respect thereof) shall be deemed to have been issued
               in full  satisfaction  of all rights  pertaining  to such Company
               Shares.  At the Effective  Time,  the stock transfer books of the
               Company shall be closed, and thereafter there shall be no further
               registration of transfers of Company Shares on the records of the
               Surviving  Corporation.  From and after the Effective  Time,  the
               holders of  Certificates  evidencing  ownership of Company Shares
               outstanding  shall cease to have any rights with  respect to such
               Company Shares except as otherwise provided for herein. If, after
               the Effective Time,  Certificates  are presented to the Surviving
               Corporation for any reason,  they shall be canceled and exchanged
               as provided in this Section 2.

          (ix) LOST,  STOLEN  OR  DESTROYED  CERTIFICATES.   In  the  event  any
               Certificates  evidencing  Company  Shares  shall  have been lost,
               stolen or destroyed,  the Exchange  Agent shall issue in exchange
               for such lost, stolen or destroyed Certificates,  upon the making
               of an affidavit of that fact by the holder  thereof,  such Parent
               Shares and cash for fractional shares, if any, as may be required
               pursuant to this Section 2; provided,  however,  that Parent may,
               in its  discretion  and as a condition  precedent to the issuance
               thereof,  require  the owner of such  lost,  stolen or  destroyed
               Certificates  to deliver a bond in such sum as it may  reasonably
               direct as  indemnity  against any claim that may be made  against
               Parent or the  Exchange  Agent with  respect to the  Certificates
               alleged to have been lost, stolen or destroyed.

          (x)  TAX  CONSEQUENCES.  For federal income tax purposes,  the Parties
               intend that the Merger be treated as a reorganization  within the
               meaning of Section  368(a) of the Code,  and that this  Agreement
               shall be, and is hereby,  adopted as a plan of reorganization for
               purposes of Section 368 of the Code. The Parties shall not take a
               position on any Returns inconsistent with this Section 2(e)(x).

3.   REPRESENTATIONS  AND WARRANTIES OF THE COMPANY.  Except as set forth in the
     disclosure  schedule prepared by the Company and attached as Exhibit C (the
     "Company  Disclosure  Schedule"),  which is arranged to  correspond  to the
     lettered and numbered  paragraphs  contained in the applicable  sections of
     this Agreement,  the Company  represents and warrants to the Parent and the
     Merger Sub as follows:

                                       12
<PAGE>
     (a)  ORGANIZATION,  QUALIFICATION,  AND CORPORATE  POWER.  The Company is a
          corporation  duly organized,  validly  existing,  and in good standing
          under the laws of the jurisdiction of its incorporation.  Section 3(a)
          of the Company Disclosure  Schedule sets forth, as of the date hereof,
          a  true  and  complete  list  of all of  the  Company's  directly  and
          indirectly  owned  Subsidiaries,  together  with the  jurisdiction  of
          incorporation or organization of each Subsidiary and the percentage of
          each Subsidiary's  outstanding  capital stock or other equity or other
          interest  owned by the Company or another  Subsidiary  of the Company.
          Except  as  set  forth  in  Section  3(a)  of the  Company  Disclosure
          Schedule,  neither the Company  nor any of its  Subsidiaries  owns any
          equity or similar  interest  in, or any interest  convertible  into or
          exchangeable or exercisable for, directly or indirectly, any equity or
          similar  interest  in,  any  Person.  Each  of  the  Company  and  its
          Subsidiaries  is duly  authorized  to conduct  business and is in good
          standing under the laws of each jurisdiction  where such qualification
          is  required,  except where the lack of such  qualification  would not
          have a materially adverse effect on the business, financial condition,
          operations,  results of operations, or future prospects of the Company
          and its Subsidiaries  taken as a whole (a "Company  Materially Adverse
          Effect").  Each of the  Company and all of its  Subsidiaries  has full
          corporate  power and authority to carry on the  businesses in which it
          is engaged and to own and use the properties owned and used by it. The
          Company has heretofore furnished to Parent a true and complete copy of
          each of its and  each  of its  Subsidiaries'  Charter  and  bylaws  or
          equivalent  organizational  documents,  as amended or  restated to the
          date  hereof.  Such Charter and bylaws and  equivalent  organizational
          documents  of the  Company  and each of its  Subsidiaries  are in full
          force and effect, and no other organizational documents are applicable
          to or binding upon the Company or its Subsidiaries.

     (b)  CAPITALIZATION.

           (i) The entire  authorized  capital stock of the Company  consists of
               20,000,000  Company Shares. As of the date hereof, (i) 11,150,001
               Company  Shares  were  issued  and  outstanding;  (ii) no Company
               Shares were held in the treasury of the Company; (iii) no Company
               Shares  were  held by any  Subsidiary  of the  Company;  and (iv)
               2,331,000  Company Shares were duly reserved for future  issuance
               pursuant to employee and director stock options granted  pursuant
               to the  Company's  four stock  option plans (the  "Company  Stock
               Option  Plans"),  of which 1,876,500  represented  Company Shares
               reserved  for  options  that had been  granted  prior to the date
               hereof (the "Outstanding Company Stock Options").

          (ii) None of the outstanding Company Shares is subject to, nor was any
               of them issued in violation of any, purchase option, call option,
               right of first refusal,  preemptive right,  subscription right or
               any similar right.  Except as set forth above and in Section 3(b)
               of the  Company  Disclosure  Schedule,  no  shares  of  voting or
               non-voting capital stock, other equity interests, or other voting

                                       13
<PAGE>
               securities  of the Company were issued,  reserved for issuance or
               outstanding.  Except as  described in Section 3(b) of the Company
               Disclosure Schedule,  all outstanding options to purchase Company
               Shares were granted under Company Stock Option Plans. The Company
               has  delivered  to  Parent  a  true  and  complete  list  of  all
               outstanding  options  and  similar  rights  to  purchase  Company
               Shares,  the  record  holder  thereof  and  the  exercise  prices
               thereof.  All outstanding  shares of capital stock of the Company
               are,  and all shares  which may be issued  upon the  exercise  of
               stock options and similar  purchase  rights will be, when issued,
               duly authorized, validly issued, fully paid and nonassessable and
               not subject to any kind of preemptive (or similar) rights.  There
               are no  bonds,  debentures,  notes or other  indebtedness  of the
               Company with voting rights (or convertible  into, or exchangeable
               for,  securities  with  voting  rights)  on any  matters on which
               stockholders of the Company may vote.

         (iii) Section 3(b) of the Company  Disclosure  Schedule  sets forth the
               number of authorized and outstanding shares of capital stock, and
               ownership thereof, of each of the Company's Subsidiaries.  Except
               as set forth in Section 3(h) of the Company Disclosure  Schedule,
               all of the  outstanding  shares of  capital  stock of each of the
               Company's Subsidiaries have been duly authorized, validly issued,
               fully paid and  nonassessable,  are not  subject to, and were not
               issued in violation of, any preemptive (or similar)  rights,  and
               are owned, of record and  beneficially,  by the Company or one of
               its direct or indirect Subsidiaries,  free and clear of all Liens
               whatsoever.  Except as set forth in Section  3(b) of the  Company
               Disclosure Schedule,  there are no restrictions of any kind which
               prevent  the  payment  of  dividends  by  any  of  the  Company's
               Subsidiaries, and neither the Company nor any of its Subsidiaries
               is subject to any  obligation or requirement to provide funds for
               or to  make  any  investment  (in the  form of a loan or  capital
               contribution) to or in any Person.

          (iv) Except as  described  in Section  3(b) of the Company  Disclosure
               Schedule, there are no outstanding securities, options, warrants,
               calls,   rights,    convertible   or   exchangeable   securities,
               commitments, agreements, arrangements or undertakings of any kind
               (contingent  or  otherwise)  to which the  Company  or any of its
               Subsidiaries  is a  party  or by  which  any  of  them  is  bound
               obligating  the  Company  or any of its  Subsidiaries  to  issue,
               deliver  or  sell,  or  cause to be  issued,  delivered  or sold,
               additional  shares of capital stock or other voting securities of
               the  Company  or of any of its  Subsidiaries  or  obligating  the
               Company or any of its  Subsidiaries  to issue,  grant,  extend or
               enter  into any such  security,  option,  warrant,  call,  right,
               commitment,  agreement,  arrangement or undertaking. There are no
               outstanding  contractual obligations of the Company or any of its
               Subsidiaries  to  repurchase,  redeem or  otherwise  acquire  any
               shares of capital  stock (or  options or  warrants to acquire any
               such  shares)  of the  Company  or its  Subsidiaries.  Except  as

                                       14
<PAGE>
               described in Section 3(b) of the Company Disclosure Schedule,  as
               of the  date  hereof,  there  are no  stock-appreciation  rights,
               stock-based  performance  units,  "phantom" stock rights or other
               agreements,   arrangements   or   commitments  of  any  character
               (contingent or otherwise)  pursuant to which any Person is or may
               be  entitled  to receive  any payment or other value based on the
               revenues,   earnings  or  financial   performance,   stock  price
               performance  or  other  attribute  of the  Company  or any of its
               Subsidiaries  or assets or  calculated  in  accordance  therewith
               (other than  ordinary  course  payments or  commissions  to sales
               representatives  of the Company based upon revenues  generated by
               them  without  augmentation  as  a  result  of  the  transactions
               contemplated  hereby)  or to  cause  the  Company  or  any of its
               Subsidiaries   to  file  a  registration   statement   under  the
               Securities Act, or which otherwise  relate to the registration of
               any  securities  of the  Company.  Except as set forth in Section
               3(b) of the  Company  Disclosure  Schedule,  there  are no voting
               trusts,    proxies   or   other   agreements,    commitments   or
               understandings  of any  character  to which the Company or any of
               its  Subsidiaries or, to the Knowledge (as defined herein) of the
               Company, any of the Company's stockholders is a party or by which
               any of them is  bound  with  respect  to the  issuance,  holding,
               acquisition, voting or disposition of any shares of capital stock
               of the Company or any of its Subsidiaries.

     (c)  AUTHORIZATION OF TRANSACTION. The Company has full power and authority
          (including  full corporate power and authority) to execute and deliver
          this  Agreement and to perform its  obligations  hereunder;  provided,
          however,  that the Company  cannot  consummate  the Merger  unless and
          until it receives the Requisite Stockholder  Approval.  This Agreement
          constitutes the valid and legally  binding  obligation of the Company,
          enforceable in accordance with its terms and conditions.

     (d)  NONCONTRAVENTION.  Neither  the  execution  and the  delivery  of this
          Agreement,  nor  the  consummation  of the  transactions  contemplated
          hereby, will (i) violate any Law or other restriction of any Authority
          to which the  Company  or any of its  Subsidiaries  is  subject or any
          provision  of the  Charter  or bylaws  (or  equivalent  organizational
          documents) of the Company or any of its  Subsidiaries or (ii) conflict
          with, result in a breach of, constitute a default under, result in the
          acceleration  of,  create  in  any  Party  the  right  to  accelerate,
          terminate,  modify,  or cancel, or require any notice or consent under
          any  agreement,   contract,  lease,  license,   instrument,  or  other
          arrangement to which the Company or any of its Subsidiaries is a party
          or by which it is bound or to which any of its assets is  subject  (or
          result in the  imposition of any Lien upon any of its assets),  except
          in each case as set forth in Section  3(d) of the  Company  Disclosure
          Schedule or as would not  reasonably be expected,  individually  or in
          the  aggregate,  to  result  in a Company  Materially  Adverse  Effect
          (including by reason of any  cross-default).  Other than in connection
          with  the  provisions  of the  Hart-Scott-Rodino  Act,  the  Tennessee

                                       15
<PAGE>
          Business  Corporation Act, the Tennessee Business Combination Act, the
          Securities  Exchange  Act, the  Securities  Act, the state  securities
          laws,  and the rules  and  regulations  of The  Nasdaq  Stock  Market,
          neither the Company nor any of its  Subsidiaries  needs to give notice
          to, make any filing with,  or obtain any  authorization,  consent,  or
          approval of any Authority in order for the Parties to  consummate  the
          transactions contemplated by this Agreement.

     (e)  COMPANY  PUBLIC  REPORTS.  The Company  has filed all forms,  reports,
          schedules,  statements,  and documents required to be filed by it with
          the SEC since  January  1, 1998  (collectively,  the  "Company  Public
          Reports").  Each of the Company  Public  Reports was filed on a timely
          basis and complied with the Securities Act and the Securities Exchange
          Act in all material respects.  None of the Company Public Reports,  as
          of their respective  dates, (or if amended or superseded,  at the time
          of such  subsequent  filing),  contained  any  untrue  statement  of a
          material fact or omitted to state a material  fact  necessary in order
          to make the  statements  made therein,  in light of the  circumstances
          under which they were made, not misleading.  The Company has delivered
          to the  Parent a correct  and  complete  copy of each  Company  Public
          Report  (together  with all  exhibits  and  schedules  thereto  and as
          amended to date).

     (f)  FINANCIAL  STATEMENTS.  Each of the  audited and  unaudited  financial
          statements  included in or  incorporated by reference into the Company
          Public  Reports  (including  the  related  notes  and  schedules)  (i)
          complied in all material respects with applicable  requirements of the
          SEC with respect  thereto;  (ii) have been prepared in accordance with
          GAAP  applied on a consistent  basis  throughout  the periods  covered
          thereby;  and (iii)  present  fairly the  financial  condition  of the
          Company and its Subsidiaries as of the indicated dates and the results
          of  operations of the Company and its  Subsidiaries  for the indicated
          periods, provided, however, that the interim statements are subject to
          normal and recurring  year-end  adjustments  that have not been and to
          the Company's Knowledge will not be material.

     (g)  EVENTS  SUBSEQUENT TO MOST RECENT FISCAL  QUARTER END.  Since the Most
          Recent Fiscal Quarter End, there has not been any event, circumstance,
          act, or omission that has resulted in, or reasonably would be expected
          to result in, a Company Materially Adverse Effect.

     (h)  UNDISCLOSED   LIABILITIES.   Neither   the  Company  nor  any  of  its
          Subsidiaries  has  liabilities or obligations of any nature,  (whether
          known or unknown, whether asserted or unasserted,  whether absolute or
          contingent,  whether  accrued  or  unaccrued,  whether  liquidated  or
          unliquidated,  and  whether  due  or to  become  due),  including  any
          liability for Taxes,  which  individually  or in the  aggregate  would
          reasonably be expected to have a Company  Materially  Adverse  Effect,
          except for (i) liabilities or obligations set forth on the face of the
          balance sheet dated as of the Most Recent  Fiscal  Quarter End (rather
          than in any notes  thereto) and filed in the Company  Public  Reports;

          (ii)  liabilities  or  obligations  which have  arisen  after the Most
          Recent Fiscal Quarter End in the Ordinary  Course of Business (none of
          which results from, arises out of, relates to, is in the nature of, or

                                       16
<PAGE>
          was  caused by any  breach of  contract,  breach  of  warranty,  tort,
          infringement,   or  violation  of  Law);  and  (iii)   liabilities  or
          obligations  set  forth  in  Section  3(h) of the  Company  Disclosure
          Schedule.

      (i) BROKERS'  FEES.  Except for the fee payable to Merrill Lynch & Co. for
          issuing its opinion as to the fairness of the Merger  Consideration to
          the  holders of Company  Shares  from a  financial  point of view (the
          "Fairness  Opinion")  and  financial  advisory  services  described in
          Section 3(i) of the Company Disclosure  Schedule,  neither the Company
          nor any of its  Subsidiaries  has  liability or  obligation to pay any
          fees or  commissions to any broker,  finder,  or agent with respect to
          the transactions contemplated by this Agreement.

     (j)  DISCLOSURE.  None  of the  information  supplied  by the  Company  for
          inclusion in the Registration Statement or any amendment or supplement
          thereto,  shall,  at the time  such  document  is  filed,  at the time
          amended or supplemented and at the time the Registration  Statement is
          declared  effective  by the SEC,  contain  any untrue  statement  of a
          material fact or omit to state any material fact required to be stated
          therein or necessary in order to make the statements therein, in light
          of the circumstances under which they were made, not misleading.  None
          of the  information  supplied  by the  Company  for  inclusion  in the
          Definitive Proxy Materials shall, on the date such materials are first
          mailed to the  stockholders of the Company and Parent,  at the time of
          the Special  Meetings,  and at the Effective Time,  contain any untrue
          statement  of a  material  fact or omit to  state  any  material  fact
          required  to be  stated  therein  or  necessary  in  order to make the
          statements therein, in light of the circumstances under which they are
          made,  not  false or  misleading  or omit to state any  material  fact
          necessary to correct any statement in any earlier  communication  with
          respect to the Special  Meetings which has become false or misleading.
          If at any time prior to the Effective  Time any event  relating to the
          Company or any of its  respective  Affiliates,  officers or  directors
          should be  discovered  by the Company  which should be set forth in an
          amendment or supplement to the Registration  Statement or an amendment
          or supplement to the  Definitive  Proxy  Materials,  the Company shall
          promptly inform Parent and Merger Sub. The Definitive  Proxy Materials
          shall comply in all material  respects as to form and  substance  with
          the  requirements of the Exchange Act and the regulations  promulgated
          thereunder.  Notwithstanding  the  foregoing,  the  Company  makes  no
          representation or warranty with respect to any information supplied by
          the  Company  which is  contained  in the  Registration  Statement  or
          Definitive Proxy Materials.

     (k)  EMPLOYEE BENEFIT PLANS.

           (i) Section  3(k)  of the  Company  Disclosure  Schedule  includes  a
               complete list of all Company Benefit Plans.

          (ii) With  respect to each  Company  Benefit  Plan,  the  Company  has
               provided to the Parent a true,  correct and complete copy of: (i)
               all plan documents,  benefit  schedules,  trust  agreements,  and
               insurance  contracts  and other funding  vehicles;  (ii) the most
               recent  Annual   Report  (Form  5500  Series)  and   accompanying

                                       17
<PAGE>
               schedule, if any; (iii) the current summary plan description,  if
               any; (iv) the most recent annual  financial  report,  if any; (v)
               the  most  recent  actuarial  report,  if any;  and (vi) the most
               recent  determination  letter from the Internal  Revenue  Service
               (the "IRS"), if any.

         (iii) The Company and each of its  Subsidiaries  has  complied,  and is
               now in compliance in all material  respects  with, all provisions
               of  ERISA,  the  Code,  and all Laws  applicable  to the  Company
               Benefit Plans.  With respect to each Company Benefit Plan that is
               intended to be a  "qualified  plan" within the meaning of Section
               401(a) of the Code, the IRS has issued a favorable  determination
               letter,  and to the Knowledge of the Company nothing has occurred
               at the date hereof that reasonably would be expected to cause the
               loss of such qualification.

          (iv) All contributions required to be made to any Company Benefit Plan
               by applicable  Law or by any plan  document or other  contractual
               undertaking,  and all  premiums  due or payable  with  respect to
               insurance  policies  funding any Company  Benefit  Plan,  for any
               period  through  the date hereof have been timely made or paid in
               full or,  to the  extent  not  required  to be made or paid on or
               before  the  date  hereof,  have  been  fully  reflected  in  the
               financial  statements  of the  Company  included  in the  Company
               Public Reports to the extent required under GAAP.

          (v)  With  respect to each  Company  Benefit  Plan which is subject to
               Title  IV or  Section  302 of ERISA  or  Section  412 of the Code
               maintained or contributed  to (or required to be contributed  to)
               by the Company,  any of its  Subsidiaries or any ERISA Affiliate,
               (i) there does not now exist, nor do any circumstances exist that
               could  result  in,  any  liability  of the  Company or any of its
               Subsidiaries  under Title IV of ERISA (other than for the payment
               of premiums,  all of which have been paid when due), (ii) neither
               the  Company  nor  any  of  its  Subsidiaries  has  incurred  any
               accumulated  funding deficiency within the meaning of Section 302
               of ERISA or Section  412 of the Code  (whether or not waived) and
               there  has been no  waiver  or  application  for a waiver  of any
               minimum funding standard or extension of any amortization  period
               under  Section 412 of the Code or Part 3 of Subtitle B of Title I
               of ERISA, (iii) no "reportable event" (as such term is defined in
               Section  4043  of  ERISA  and  the  regulations  thereunder)  has
               occurred  or is  expected  to occur,  (iv) no notice of intent to
               terminate  has been  filed  with  the  Pension  Benefit  Guaranty
               Corporation, (v) the Pension Benefit Guaranty Corporation has not
               instituted any  proceedings to terminate the plan or to appoint a
               trustee to administer  the plan, and (vi) there has been no event
               requiring disclosure under Section 4063(a) of ERISA. For purposes
               of this Section 3(k), the term "ERISA  Affiliate"  shall mean any
               business  or  entity  (whether  or not  incorporated)  which is a
               member  of the same  "controlled  group of  corporations,"  under
               "common  control,"  or an  "affiliated  service  group"  with the

                                       18
<PAGE>
               Company or any of its Subsidiaries  within the meaning of Section
               414(b), (c) or (m) of the Code, or is under "common control" with
               the  Company or any of its  Subsidiaries  within  the  meaning of
               Section 4001(a)(14) of ERISA.

          (vi) Neither  the Company  nor any of its  Subsidiaries  nor any ERISA
               Affiliate  has been  required to  contribute  to, or incurred any
               withdrawal  liability  (within  the  meaning of  Section  4201 of
               ERISA) with respect to any plan which is a multiemployer  plan as
               defined  in  Section  3(37) of ERISA  (a  "Multiemployer  Plan").
               Neither  the Company  nor any of its  Subsidiaries  nor any ERISA
               Affiliate  has   completely  or  partially   withdrawn  from  any
               Multiemployer  Plan.  No  Multiemployer  Plan  as  to  which  the
               Company,  any  of its  Subsidiaries  or any  ERISA  Affiliate  is
               required to contribute is in reorganization within the meaning of
               Part 3 of  Subtitle  E of Title IV of ERISA.  The  Company  shall
               deliver to Parent,  prior to the Closing,  a schedule showing the
               contributions of the Company,  any of its  Subsidiaries,  and any
               ERISA Affiliates to each of the Multiemployer  Plans for the most
               recent five plan years.

         (vii) There are no pending actions,  claims or lawsuits which have been
               asserted,  instituted  or,  to  the  Knowledge  of  the  Company,
               threatened  in connection  with any of the Company  Benefit Plans
               (other than routine claims for benefits)  which would  reasonably
               be expected,  individually  or in the  aggregate,  to result in a
               Company Materially Adverse Effect.

        (viii) Neither  the Company  nor any of its  Subsidiaries  maintains  or
               contributes to any plan or arrangement  which provides or has any
               liability to provide life  insurance or medical or other  welfare
               benefits to any  employee,  former  employee,  director or former
               director  upon his  retirement  or  termination  of service,  and
               neither  the  Company  nor  any  of  its  Subsidiaries  has  ever
               represented,  promised, or contracted (whether in oral or written
               form)  to any  employee,  former  employee,  director  or  former
               director that such benefits would be provided.

          (ix) The  Company  and  its  Subsidiaries  are  in  compliance  in all
               material  respects with the continuation  coverage  provisions of
               Section 601 et seq. of ERISA and Section 4980B of the Code.

     (l)  EMPLOYMENT AND LABOR MATTERS.

           (i) Section 3(l) of the Company  Disclosure  Schedule  identifies all
               employees and consultants employed or engaged by the Company with
               an annual base salary or  compensation  rate of $80,000 or higher
               and sets  forth  each  such  individual's  rate of pay or  annual
               compensation,  job title and date of hire. Except as set forth in
               Section  3(l) of the Company  Disclosure  Schedule,  there are no

                                       19
<PAGE>
               employment,  consulting,  collective  bargaining,  severance pay,
               continuation pay,  termination or  indemnification  agreements or
               other similar contracts of any nature (whether in writing or not)
               between the Company or any  Subsidiary  and any current or former
               stockholder,   officer,  director,  employee,  consultant,  labor
               organization or other  representative  of any of the Company's or
               Subsidiary's employees,  nor is any such contract presently being
               negotiated.  Except as set forth in Section  3(l) of the  Company
               Disclosure  Schedule,   no  individual  will  accrue  or  receive
               additional  benefits,  service or accelerated  rights to payments
               under  any  Benefit  Plan or any of the  agreements  set forth in
               Section 3(l) of the Company  Disclosure  Schedule,  including the
               right to receive  any  parachute  payment,  as defined in Section
               280G of the Code, or become  entitled to  severance,  termination
               allowance  or similar  payments  as a result of the  Merger  that
               could  result in the payment of any such  benefits  or  payments.
               Neither the Company nor any  Subsidiary is delinquent in payments
               to any of its employees or consultants  for any wages,  salaries,
               commissions,  bonuses,  benefits  or other  compensation  for any
               services  or  otherwise  arising  under  any  policy,   practice,
               agreement,  plan,  program or Law. Except as set forth in Section
               3(l) of the Company Disclosure Schedule,  neither the Company nor
               any  Subsidiary is liable for any severance pay or other payments
               to any employee or former  employee  arising from the termination
               of employment,  nor will the Company or any  Subsidiary  have any
               liability  under  any  benefit  or  severance  policy,  practice,
               agreement,  plan,  or program  which exists or arises,  or may be
               deemed to exist or arise,  under any applicable Law or otherwise,
               as  a  result  of  or  in   connection   with  the   transactions
               contemplated  hereunder or as a result of the  termination by the
               Company or any Subsidiary of any Persons  employed by the Company
               or any Subsidiary on or prior to the Effective Time.

          (ii) Except as set forth in  Section  3(l) of the  Company  Disclosure
               Schedule,  none of the Company's or any  Subsidiary's  employment
               policies or practices is currently  being audited or investigated
               by any  Authority.  Except  as set forth in  Section  3(l) of the
               Company  Disclosure  Schedule,  there is no  pending  or,  to the
               Knowledge of the  Company,  threatened  Litigation,  unfair labor
               practice  charge,  or other charge or inquiry against the Company
               or any  Subsidiary  brought  by or on  behalf  of  any  employee,
               prospective   employee,    former   employee,    retiree,   labor
               organization  or  other   representative   of  the  Company's  or
               Subsidiary's  employee, or other individual or any Authority with
               respect  to  employment   practices  brought  by  or  before  any
               Authority.  Except as set forth in  Section  3(l) of the  Company
               Disclosure  Schedule,  there  are  no  controversies  pending  or
               threatened,  between the Company or any of its  Subsidiaries  and
               any of their respective employees; neither the Company nor any of
               its  Subsidiaries  is  a  party  to  any  collective   bargaining
               agreement  or other labor union  contract  applicable  to Persons

                                       20
<PAGE>
               employed  by the  Company or its  Subsidiaries  nor are there any
               activities or proceedings of any labor union to organize any such
               employees of the Company or any of its  Subsidiaries;  during the
               past five  years  there  have been no  strikes,  slowdowns,  work
               stoppages,  disputes,  lockouts,  or threats thereof,  by or with
               respect  to  any   employees   of  the  Company  or  any  of  its
               Subsidiaries.  Except as set forth in Section 3(l) of the Company
               Disclosure  Schedule,  there are no grievances pending or, to the
               Knowledge  of the Company or any  Subsidiary,  threatened,  which
               could reasonably be expected to have a Company Materially Adverse
               Effect.  Neither the Company nor any Subsidiary is a party to, or
               otherwise bound by, any consent decree with, or citation or other
               Order by, any  Authority  relating  to  employees  or  employment
               practices.  The  Company  and  each  of its  Subsidiaries  are in
               compliance  in all material  respects with all  applicable  Laws,
               contracts, and policies relating to employment.

     (m)  ENVIRONMENTAL  MATTERS.  Except  as set forth in  Section  3(m) of the
          Company  Disclosure  Schedule  or except as would  not  reasonably  be
          expected,  individually  or  in  the  aggregate,  to  have  a  Company
          Materially Adverse Effect, (i) no Hazardous  Materials are present at,
          on  or  under  any  real  property  currently  or,  to  the  Company's
          Knowledge,  formerly owned,  leased, or operated by the Company or any
          of its  Subsidiaries  to an  extent or in a manner  or  condition  now
          requiring investigation, response, corrective action, or other action,
          or, to the Company's Knowledge,  that could result in liability of, or
          costs  to,  the  Company  or  any  of  its  Subsidiaries,   under  any
          Environmental  Law,  (ii) there is  currently no civil,  criminal,  or
          administrative  action,  suit, demand,  hearing,  proceeding notice of
          violation,  investigation,  notice or demand  letter,  or request  for
          information  pending or to the  knowledge of the Company,  threatened,
          under  any  Environmental  Law  against  the  Company  or  any  of its
          Subsidiaries, (iii) the Company and its Subsidiaries have not received
          any claims or notices alleging  liability under any Environmental Law,
          and the  Company  has no  knowledge  of any  circumstances  that would
          reasonably  be expected to result in such claims or notices,  (iv) the
          Company and each of its Subsidiaries are currently in compliance,  and
          within the period of applicable  statutes of limitation have complied,
          with all,  and, to the Company 's Knowledge,  have no liability  under
          any,  applicable  Environmental  Laws,  (v) the  Company  has not been
          notified about any property or facility currently or, to the Company's
          Knowledge as of the date hereof,  formerly owned,  leased, or operated
          by the Company or any of its  Subsidiaries or any of their  respective
          predecessors-in-interest,  or at  which  Hazardous  Materials  of  the
          Company  or any of its  Subsidiaries  have been  stored,  treated,  or
          disposed  of is  listed  or  proposed  for  listing  on  the  National
          Priorities   List  or  the   Comprehensive   Environmental   Response,
          Compensation and Liability  Information System, both promulgated under
          the Comprehensive  Environmental Response,  Compensation and Liability
          Act of 1980, as amended,  or on any  comparable  state or foreign list
          established under any Environmental Law, (vi) the execution, delivery,

                                       21
<PAGE>
          and  performance  of  this  Agreement  and  the  consummation  of  the
          transactions  contemplated  hereby  will not  affect the  validity  or
          require the transfer of any Environmental  Permits held by the Company
          or any of its  Subsidiaries,  and will not require  any  notification,
          disclosure,    registration,    reporting,   filing,    investigation,
          remediation,  or other action under any  Environmental  Law,  (vii) no
          friable  asbestos is present in, on, or at any  property,  facility or
          equipment of the Company or any of its Subsidiaries,  (viii) there are
          no past or present events, conditions,  activities, or practices which
          could   reasonably   be  expected  to  prevent  the  Company  and  its
          Subsidiaries'  compliance with any  Environmental  Law, or which would
          reasonably be expected to give rise to any liability of the Company or
          any of its Subsidiaries  under any Environmental Law, (ix) no Lien has
          been asserted or recorded, or to the Knowledge of the Company and each
          of its  Subsidiaries  threatened,  under  any  Environmental  Law with
          respect to any assets,  facility,  inventory,  or  property  currently
          owned,  leased or operated by the Company or any of its  Subsidiaries,
          (x) neither the  Company  nor any of its  Subsidiaries  has assumed by
          contract or agreement any liabilities or obligations arising under any
          Environmental Law including,  without limitation, any such liabilities
          or obligations with respect to formerly owned, leased or operated real
          property or  facilities,  or former  divisions or  Subsidiaries,  (xi)
          neither the Company nor any of its  Subsidiaries  has entered  into or
          agreed to any Order by any  judicial  or  administrative  tribunal  or
          agency and neither the Company nor any of its  Subsidiaries is subject
          to any Order or agreement,  in each case  relating to compliance  with
          any  Environmental  Law  or  requiring  the  Company  or  any  of  its
          Subsidiaries  to conduct any  investigation,  response,  corrective or
          other  action  with  respect  to any  Hazardous  Materials  under  any
          Environmental  Law, and (xii) other than disclosed on Schedule 3(m) of
          the Company Disclosure Schedule there are no underground storage tanks
          or  above-ground  storage tanks or related piping at any real property
          owned,  operated, or leased by the Company or any of its Subsidiaries,
          and any former such tanks and piping on any such  property  which have
          been removed or closed, have been removed or closed in accordance with
          applicable Environmental Laws.

          For purposes of this Agreement,  the term  "Environmental  Laws" means
          the common law and all applicable  federal,  state, local, and foreign
          Laws,  rules,  regulations,  codes,  or  Orders  issued,  promulgated,
          approved, or entered thereunder relating to pollution or protection of
          human  health  and  safety  or  the  environment  (including,  without
          limitation, ambient air, indoor air, surface water, ground water, land
          surface,  subsurface  strata,  and natural resources such as wetlands,
          flora,  fauna),   including  without  limitation,   Laws  relating  to
          emissions,  discharges,  releases or threatened  releases of Hazardous
          Materials  into  the  environment,   or  otherwise   relating  to  the
          manufacture,  processing,  generation,  distribution,  use, treatment,
          storage, disposal,  transport, or handling of Hazardous Materials. For
          purposes of this Agreement,  the term "Hazardous  Materials" means any
          pollutant,   contaminant,  toxic,  hazardous  or  extremely  hazardous
          substance,  constituent  or waste,  or any other  constituent,  waste,

                                       22
<PAGE>
          chemical,   compound,   material  or  substance,   including   without
          limitation, petroleum or any petroleum product, including crude oil or
          any fraction  thereof,  subject to regulation by or that can give rise
          to  liability  under  any  Environmental  Law.  For  purposes  of this
          Agreement,  the term "Environmental Permit" means any permit, license,
          approval,  consent, or other  authorization  provided or issued by any
          government or regulatory Authority pursuant to an Environmental Law.

          The  Company has made  available  to the Parent all records and files,
          including,  but not limited  to, all  assessments,  reports,  studies,
          audits, analyses,  tests, and data in the possession or control of the
          Company  or any of  its  Subsidiaries  relating  to the  existence  of
          Hazardous Materials at facilities or properties  currently or formerly
          owned,  operated,  leased  or  used  by  the  Company  or  any  of its
          Subsidiaries  or in any way  concerning  compliance by the Company and
          any of its Subsidiaries  with, or liability of any of them, under, any
          Environmental Law.

     (n)  TAKEOVER STATUTES. The Board of Directors of the Company has taken all
          appropriate and necessary  actions such that Parent and the Merger Sub
          will not be prohibited  from  entering  into a "business  combination"
          with the Company as an "interested  stockholder" (in each case as such
          term  is  used  in  Section   48-103-205  of  the  Tennessee  Business
          Combination  Act) as a result of the  execution  and  delivery of this
          Agreement or the consummation of the transactions contemplated hereby.
          No other "fair price,"  "moratorium,"  "control share acquisition," or
          other similar  anti-takeover statute or regulation as in effect on the
          date hereof is  applicable  to the Company,  the Company  Shares,  the
          Merger, or the other transactions  contemplated by this Agreement.  No
          takeover  statute or similar  Law and no  provision  of the Charter or
          bylaws, or other organizational  documents or governing instruments of
          the Company or any of its  Subsidiaries  or any material  agreement to
          which  any of them is a party  (a)  would or would  purport  to impose
          restrictions which might adversely affect or delay the consummation of
          the transactions contemplated by this Agreement, or (b) as a result of
          the consummation of the  transactions  contemplated by this Agreement,
          or the  acquisition  of  securities  of the  Company or the  Surviving
          Corporation  by  Parent or Merger  Sub (i) would or would  purport  to
          restrict or impair the ability of Parent to vote or otherwise exercise
          the rights of a Stockholder  with respect to securities of the Company
          or any of its  Subsidiaries  that may be  acquired  or  controlled  by
          Parent or (ii) would or would purport to entitle any Person to acquire
          securities of the Company or the Parent  (except for the Parent Shares
          issued as Merger Consideration in accordance with Section 2 hereof).

     (o)  TAX MATTERS. With respect to Taxes except as set forth in Section 3(o)
          of the Company Disclosure Schedule:

           (i) To the best  Knowledge  of the  Company,  the  Company has filed,
               within the time and in the manner prescribed by Law, all returns,
               declarations,   reports,  estimates,   information  returns,  and

                                       23
<PAGE>
               statements (the "Returns")  required to be filed under applicable
               Law, and all such Returns are true,  correct,  and complete.  The
               Company has within the time and in the manner  prescribed by Law,
               paid all Taxes that are due and  payable  with  respect to it and
               its  consolidated  group.  The  Company  has  established  on the
               balance  sheet  dated as of the Most  Recent  Fiscal  Quarter End
               reserves, charges, and accruals that are adequate for the payment
               of all Taxes not yet due and  payable  that are  attributable  to
               periods  ending on such  date.  There are no Liens for Taxes upon
               the  assets  of the  Company  except  for Liens for Taxes not yet
               delinquent.

          (ii) To  the  best  Knowledge  of  the  Company,   no  action,   suit,
               proceeding,  investigation, claim or audit has formally commenced
               and no  written  notice  has been  given that such audit or other
               proceeding is pending or  threatened  with respect to the Company
               or any of its  Subsidiaries or any group of corporations of which
               any of the  Company  and its  Subsidiaries  has been a member  in
               respect of any Taxes, and all  deficiencies  proposed as a result
               of such actions, suits,  proceedings,  investigations,  claims or
               audits have been paid, reserved against or settled.  There are no
               outstanding   waivers  or  comparable   consents   regarding  the
               application of the statute of limitations with respect to any Tax
               or Return that have been  requested or given by or that relate to
               the Company.

         (iii) The  Company  and,  if  applicable,  its  agents  and  contracted
               service  providers,  have  complied  in  all  respects  with  all
               applicable  Laws relating to the payment and withholding of Taxes
               and  have,  within  the  time  and in the  manner  prescribed  by
               applicable Law, withheld,  collected, and paid over to the proper
               Authority all amounts required to be so withheld,  collected, and
               paid over under all applicable Laws.

          (iv) The Company and its Subsidiaries have not made any payments,  are
               not  obligated to make any  payments,  and are not a party to any
               agreements  that under any  circumstances  could  obligate any of
               them to make any  payments,  that  will not be  deductible  under
               Section  280G of the Code.  Neither  the  Company  nor any of its
               Subsidiaries  has made an election  under  Section  341(f) of the
               Code. None of the Company and its  Subsidiaries  will be required
               to include any material  amount in taxable income for any taxable
               period (or portion  thereof)  ending  after the Closing Date as a
               result of a change  in the  method  of  accounting  for a taxable
               period ending prior to the Closing Date, any "closing  agreement"
               as described  in Section  7121 of the Code (or any  corresponding
               provision of state, local or foreign Tax Laws) entered into prior
               to the Closing Date, any sale reported on the installment  method
               that occurred  prior to the Closing  Date, or any taxable  income
               attributable to any amount that is economically  accrued prior to
               the Closing Date.

                                       24
<PAGE>
     (p)  INSURANCE;  BONDS.  Section  3(p) of the Company  Disclosure  Schedule
          contains  a list  of,  and the  Parent  has  been  furnished  true and
          complete copies of, all material insurance policies and fidelity bonds
          covering  the  Company's  assets,  business,  properties,  operations,
          employees,  officers,  and directors,  and other matters for which the
          Company  carries  insurance.  Section  3(p) of the Company  Disclosure
          Schedule describes any self-insurance  arrangement by or affecting the
          Company,  including any reserves established thereunder,  covering any
          years in which  there are  outstanding  claims  (the  earliest of such
          years referred to as the "Company Base Year").  Except as set forth in
          Section 3(p) of the Company Disclosure Schedule,  there is no claim by
          any insured  pending  under any of such  policies or bonds as to which
          coverage has been questioned,  denied, or disputed by the underwriters
          of such  policies  or  bonds.  All  premiums  payable  under  all such
          policies  and bonds have been paid,  and the Company is  otherwise  in
          full compliance with the terms and conditions of all such policies and
          bonds.  As to all claims  that might be  covered by such  policies  or
          bonds,  the Company has promptly and within any prescribed time period
          notified the insuring or bonding  party in the proper  manner.  Except
          for claims listed on Section 3(p) of the Company Disclosure  Schedule,
          there have been no notices given to the insurer of any claims that may
          be insured by insurer.  Such policies of insurance and bonds (or other
          policies and bonds providing substantially similar insurance coverage)
          have been in effect  continuously  since the  beginning of the Company
          Base Year,  and  remain in full force and  effect.  Such  policies  of
          insurance and bonds are of the type and in amounts customarily carried
          by Persons  conducting  similar businesses and do not exclude coverage
          for  punitive  damages.  Except  as set forth in  Section  3(p) of the
          Company Disclosure Schedule, there is no threatened termination of, or
          premium increase with respect to, any of such policies or bonds.

     (q)  COMPLIANCE. The Company and each of its Subsidiaries are in compliance
          with,  and are not in default or  violation  of, (i) its  Charter  and
          bylaws or the equivalent  organizational documents of such Subsidiary,
          (ii)  any Law or Order by which  any of  their  respective  assets  or
          properties  are bound or  affected,  and (iii) the terms of all notes,
          bonds, mortgages, indentures, contracts, permits, franchises and other
          instruments or obligations to which any of them is a party or by which
          any of them or any of their  respective  assets or properties is bound
          or affected,  except,  in the case of clauses (ii) and (iii),  for any
          such failures of compliance,  defaults and violations which could not,
          individually  or in the  aggregate,  reasonably  be expected to have a
          Company  Materially  Adverse Effect.  The Company and its Subsidiaries
          are in  compliance  with the terms of all  approvals  of  Authorities,
          except  where the failure to so comply could not,  individually  or in
          the  aggregate,  reasonably  be expected to have a Company  Materially
          Adverse  Effect.  Except as set forth in Section  3(q) of the  Company
          Disclosure Schedule or as could not, individually or in the aggregate,
          reasonably be expected to have a Company  Materially  Adverse  Effect,
          neither the Company nor any of its Subsidiaries has received notice of
          any revocation or modification  of any license,  permit,  consent,  or
          approval  of any  Authority  that is material to the Company or any of
          its Subsidiaries.

                                       25
<PAGE>
     (r)  ABSENCE OF  LITIGATION.  Except as  described  in Section  3(r) of the
          Company  Disclosure  Schedule or  expressly  described  in the Company
          Public Reports filed and publicly  available prior to the date hereof,
          there is no  Litigation  pending  on behalf of or  against  or, to the
          Knowledge of the Company,  threatened against the Company,  any of its
          Subsidiaries,  or any of their respective properties or rights, before
          or  subject  to any  court  or  governmental  Authority  which  could,
          individually  or in the  aggregate,  reasonably  be expected to have a
          Company Materially Adverse Effect.  Neither the Company nor any of its
          Subsidiaries is subject to any outstanding  Litigation or Order which,
          individually  or in the  aggregate,  has had or  could  reasonably  be
          expected to have a Company Materially Adverse Effect.

     (s)  TITLE TO ASSETS.  Except as  described  in Section 3(s) of the Company
          Disclosure Schedule, the Company and each of its Subsidiaries has good
          and  marketable  title to all of  their  real or  personal  properties
          (whether  owned or  leased)  and  assets,  free and clear of all Liens
          other than Liens which are  reflected  on the  Company's  consolidated
          balance  sheet  filed in its Form  10-Q  for the  Most  Recent  Fiscal
          Quarter End.

     (t)  POOLING; TAX MATTERS.

           (i) The Company  intends that the Merger be  accounted  for under the
               "pooling of interests"  method under the  requirements of Opinion
               No. 16 (Business Combinations) of the Accounting Principles Board
               of the American  Institute of Certified Public  Accountants,  the
               Financial  Accounting Standards Board, and the regulations of the
               SEC.

          (ii) To the  Knowledge of the Company,  neither the Company nor any of
               its Affiliates has taken or agreed to take any action,  failed to
               take any  action  or is aware  of any fact or  circumstance  that
               would  prevent  (i) the Merger from being  treated for  financial
               accounting  purposes as a "pooling of  interests"  in  accordance
               with GAAP and the regulations of the SEC; provided, that the sale
               of Company  Shares  described in Section 5(i) are taken;  or (ii)
               the Merger from constituting a reorganization  within the meaning
               of Section 368(a) of the Code.

         (iii) Assuming  the  issuance of Company  Shares  described  in Section
               5(i),  the Company has no  Knowledge of any reason why it may not
               receive a letter from its independent accountants dated as of the
               Closing  Date  and   addressed  to  the  Company  in  which  such
               accountants   will   concur  with  the   Company's   management's
               conclusion  that no conditions  exist related to the Company that
               would  preclude  Parent  from  accounting  for  the  Merger  as a
               "pooling of interests."

                                       26
<PAGE>
          (iv) Section 3(t) of the Company  Disclosure  Schedule contains a true
               and  complete  list of all Persons  who, to the  Knowledge of the
               Company, may be deemed to be Affiliates of the Company, excluding
               all of its Subsidiaries but including all directors and executive
               officers of the Company.

     (u)  OPINION OF  FINANCIAL  ADVISOR.  The Company has no  knowledge  of any
          reason why it may not receive the written  opinion of Merrill  Lynch &
          Co. to the effect  that,  in its opinion,  as of the date hereof,  the
          Merger Consideration is fair to the holders of the Company Shares from
          a financial  point of view. The aggregate fees and expenses paid or to
          be paid to Merrill Lynch & Co. shall not exceed $500,000.

     (v)  MATERIAL  AGREEMENTS.  Except  as  described  on  Section  3(v) of the
          Company Disclosure Schedule, there are no agreements of the Company or
          its Subsidiaries  (i) containing an unexpired  covenant not to compete
          or  similar  restriction  applying  to  the  Company  or  any  of  its
          Subsidiaries; (ii) providing for interest rate, currency, or commodity
          hedging, swap or similar derivative  transactions to which the Company
          or its  Subsidiaries is a party;  (iii) providing for payment based on
          revenues,  sales or  profits;  (iv)  between the Company or any of its
          Subsidiaries,  on the one hand,  and any Affiliate of the Company,  on
          the other hand; (v) which,  if terminated by the Company upon not more
          than 30 days'  notice would result in liability to the Company of more
          than $1  million;  or (vi) that would be required to be filed and have
          not been filed as an exhibit to a Form 10-K filed by the Company  with
          the SEC as of the date of this Agreement  (collectively,  the "Company
          Material  Agreements").   Assuming  each  Company  Material  Agreement
          constitutes  a  valid  and  binding  obligation  of each  other  Party
          thereto,  each  Company  Material  Agreement  is a valid  and  binding
          obligation of the Company or the  applicable  Subsidiary,  as the case
          may be. To the Company's Knowledge, each Company Material Agreement is
          a valid and binding  obligation of each other Party thereto,  and each
          such Company  Material  Agreement is in full force and effect.  To the
          Knowledge  of  the  Company,   there  are  no  existing  defaults  (or
          circumstances  or events  that,  with the giving of notice or lapse of
          time or both would become defaults) of the Company, any Subsidiary, or
          any third party under any of the Company Material Agreements.

     (w)  INTELLECTUAL PROPERTY.

           (i) Except as would not,  individually  and in the aggregate,  have a
               Company  Materially  Adverse Effect,  (i) the Company and each of
               its Subsidiaries owns, has the right to acquire or is licensed or
               otherwise has the right to use (in each case,  clear of any Liens
               of any kind), all Intellectual  Property used in or necessary for
               the  conduct of its  business  as  currently  conducted,  (ii) no
               claims  are  pending  or,  to  the   Knowledge  of  the  Company,

                                       27
<PAGE>
               threatened  that  the  Company  or  any of  its  Subsidiaries  is
               infringing  on or  otherwise  violating  the rights of any Person
               with  regard  to  any  Intellectual  Property  and  (iii)  to the
               Knowledge of the Company, no Person is infringing on or otherwise
               violating  any right of the  Company  or any of its  Subsidiaries
               with  respect  to  any  Intellectual  Property  owned  by  and/or
               licensed to the Company or its Subsidiaries.

          (ii) Section 3(w) of the Company Disclosure Schedule sets forth, as of
               the date  hereof,  a true and complete  list of all  Intellectual
               Property of the Company and each of its Subsidiaries, the loss or
               impairment  of which  would  cause a Company  Materially  Adverse
               Effect.

         (iii) For purposes of this  Agreement,  "Intellectual  Property"  shall
               mean   patents,    copyrights,    trademarks    (registered    or
               unregistered),  service marks,  brand names,  trade dress,  trade
               names,  computer  software  programs and applications  (including
               imbedded  software),  the goodwill  associated with the foregoing
               and registrations in any jurisdiction of, and applications in any
               jurisdiction  to register,  the foregoing;  and trade secrets and
               rights in any jurisdiction to limit the use or disclosure thereof
               by any person.

4.   REPRESENTATIONS  AND WARRANTIES OF THE PARENT AND THE MERGER SUB. Except as
     set forth in the disclosure schedule prepared by the Parent and attached as
     Exhibit  I  (the  "Parent  Disclosure  Schedule"),  which  is  arranged  to
     correspond  to  the  numbered  and  lettered  paragraphs  contained  in the
     applicable  sections of this  Agreement,  each of the Parent and the Merger
     Sub represents and warrants to the Company as follows:

     (a)  ORGANIZATION,  QUALIFICATION,  AND CORPORATE POWER. Each of Parent and
          Merger Sub is a corporation duly organized,  validly existing,  and in
          good standing under the laws of the jurisdiction of its incorporation.
          Section 4(a) of the Parent  Disclosure  Schedule sets forth, as of the
          date hereof, a true and complete list of all of the Parent's  directly
          and indirectly owned  Subsidiaries,  together with the jurisdiction of
          incorporation or organization of each Subsidiary and the percentage of
          each Subsidiary's  outstanding  capital stock or other equity or other
          interest  owned by the Parent or  another  Subsidiary  of the  Parent.
          Except as set forth in Section 4(a) of the Parent Disclosure Schedule,
          neither  the  Parent  nor any of its  Subsidiaries  owns any equity or
          similar interest in, or any interest  convertible into or exchangeable
          or  exercisable  for,  directly or  indirectly,  any equity or similar
          interest in, any Person.  Each of the Parent and its  Subsidiaries  is
          duly authorized to conduct  business and is in good standing under the
          laws of each jurisdiction where such qualification is required, except
          where  the lack of such  qualification  would  not  have a  materially
          adverse  effect  on the  business,  financial  condition,  operations,
          results  of  operations,  or future  prospects  of the  Parent and its
          Subsidiaries  taken as a whole (a "Parent Materially Adverse Effect").
          Each of the  Parent  and all of its  Subsidiaries  has full  corporate
          power and authority to carry on the  businesses in which it is engaged
          and to own and use the properties owned and used by it. The Parent has

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<PAGE>
          heretofore  furnished to the Company a true and complete  copy of each
          of its and each of its Subsidiaries'  Charter and bylaws or equivalent
          organizational  documents,  as amended or restated to the date hereof.
          Such Charter and bylaws and equivalent organizational documents of the
          Parent and each of its Subsidiaries are in full force and effect,  and
          no other  organizational  documents are  applicable to or binding upon
          the Parent or its Subsidiaries.

     (b)  CAPITALIZATION.

           (i) The entire  authorized  capital  stock of the Parent  consists of
               150,000,000  Parent  Shares  and  1,000,000  shares  of  Parent's
               preferred  stock par value $.01 per share. As of the date hereof,
               (i) 63,260,791 Parent Shares were issued and outstanding and zero
               shares of Parent's  preferred stock were issued and  outstanding;
               (ii) 2,917,850 Parent Shares were held in the treasury of Parent;
               (iii) no Parent Shares were held by any Subsidiary of Parent; and
               (iv)  5,341,652  Parent  Shares  were duly  reserved  for  future
               issuance  pursuant to employee and director stock options granted
               pursuant to the  Parent's  three stock  option plans (the "Parent
               Stock  Option  Plans"),  of which  5,001,102  represented  Parent
               Shares  reserved for options  that had been granted  prior to the
               date hereof (the "Outstanding Parent Stock Options").

          (ii) None of the  outstanding  Parent  Shares are subject to, nor were
               they issued in violation of any,  purchase  option,  call option,
               right of first refusal,  preemptive right,  subscription right or
               any similar right.  Except as set forth above and in Section 4(b)
               of the  Parent  Disclosure  Schedule,  no  shares  of  voting  or
               non-voting capital stock, other equity interests, or other voting
               securities  of the Parent were  issued,  reserved for issuance or
               outstanding.  All  outstanding  shares  of  capital  stock of the
               Parent are,  and all shares which may be issued upon the exercise
               of stock  options  and  similar  purchase  rights  will be,  when
               issued,   duly  authorized,   validly  issued,   fully  paid  and
               nonassessable  and not  subject  to any  kind of  preemptive  (or
               similar) rights. There are no bonds,  debentures,  notes or other
               indebtedness  of the Parent  with voting  rights (or  convertible
               into, or exchangeable for,  securities with voting rights) on any
               matters on which stockholders of the Parent may vote.

         (iii) All of the  outstanding  shares of  capital  stock of each of the
               Parent's Subsidiaries have been duly authorized,  validly issued,
               fully paid and  nonassessable,  are not  subject to, and were not
               issued in violation of, any preemptive (or similar)  rights,  and
               are owned,  of record and  beneficially,  by the Parent or one of
               its direct or indirect Subsidiaries,  free and clear of all Liens
               whatsoever.  Except as set forth in  Section  4(b) of the  Parent
               Disclosure Schedule,  there are no restrictions of any kind which
               prevent  the  payment  of  dividends  by  any of  the  Parent  's
               Subsidiaries,  and neither the Parent nor any of its Subsidiaries
               is subject to any  obligation or requirement to provide funds for
               or to  make  any  investment  (in the  form of a loan or  capital
               contribution) to or in any Person.

                                       29
<PAGE>
          (iv) Except as  described  in Section  4(b) of the  Parent  Disclosure
               Schedule, there are no outstanding securities, options, warrants,
               calls,   rights,    convertible   or   exchangeable   securities,
               commitments, agreements, arrangements or undertakings of any kind
               (contingent  or  otherwise)  to which  the  Parent  or any of its
               Subsidiaries  is a  party  or by  which  any  of  them  is  bound
               obligating  the  Parent  or  any of its  Subsidiaries  to  issue,
               deliver  or  sell,  or  cause to be  issued,  delivered  or sold,
               additional  shares of capital stock or other voting securities of
               the Parent or of any of its Subsidiaries or obligating the Parent
               or any of its Subsidiaries to issue,  grant, extend or enter into
               any such security,  option,  warrant,  call,  right,  commitment,
               agreement,  arrangement or undertaking.  There are no outstanding
               contractual  obligations of the Parent or any of its Subsidiaries
               to repurchase,  redeem or otherwise acquire any shares of capital
               stock (or options or warrants to acquire any such  shares) of the
               Parent or its  Subsidiaries.  Except as described in Section 4(b)
               of the Parent Disclosure  Schedule,  as of the date hereof, there
               are no stock-appreciation  rights, stock-based performance units,
               "phantom"  stock  rights  or other  agreements,  arrangements  or
               commitments of any character  (contingent or otherwise)  pursuant
               to which any Person is or may be  entitled to receive any payment
               or other  value  based on the  revenues,  earnings  or  financial
               performance,  stock price  performance or other  attribute of the
               Parent or any of its  Subsidiaries  or assets  or  calculated  in
               accordance  therewith  (other than  ordinary  course  payments or
               commissions  to sales  representatives  of the Parent  based upon
               revenues  generated by them without  augmentation  as a result of
               the transactions  contemplated  hereby) or to cause the Parent or
               any of its  Subsidiaries  to file a registration  statement under
               the Securities Act, or which otherwise relate to the registration
               of any  securities of the Parent.  Except as set forth in Section
               4(b) of the  Parent  Disclosure  Schedule,  there  are no  voting
               trusts,    proxies   or   other   agreements,    commitments   or
               understandings of any character to which the Parent or any of its
               Subsidiaries  or,  to the  Knowledge  of the  Parent,  any of the
               Parent  's  stockholders  is a party or by  which  any of them is
               bound with respect to the issuance, holding, acquisition,  voting
               or  disposition  of any shares of capital  stock of the Parent or
               any of its Subsidiaries.

     (c)  AUTHORIZATION  OF  TRANSACTION.  Each of the Parent and the Merger Sub
          has full  power and  authority  (including  full  corporate  power and
          authority)  to execute and deliver this  Agreement  and to perform its
          obligations  hereunder;  provided,  however,  that the  Parent  cannot
          consummate  the Merger  unless  and until it  receives  the  Requisite
          Stockholder Approval. This Agreement constitutes the valid and legally
          binding  obligation  of  each  of  the  Parent  and  the  Merger  Sub,
          enforceable in accordance with its terms and conditions.

                                       30
<PAGE>
     (d)  NONCONTRAVENTION.   Neither  the   execution   and  delivery  of  this
          Agreement,  nor  the  consummation  of the  transactions  contemplated
          hereby, will (i) violate any Law or other restriction of any Authority
          to which  either  the  Parent  or the  Merger  Sub is  subject  or any
          provision  of the Charter or bylaws of either the Parent or the Merger
          Sub or (ii) conflict with, result in a breach of, constitute a default
          under, result in the acceleration of, create in any Party the right to
          accelerate,  terminate,  modify,  or cancel,  or require any notice or
          consent under any agreement,  contract, lease, license, instrument, or
          other  arrangement  to which  either the Parent or the Merger Sub is a
          party or by which  either is bound or to which any of their  assets is
          subject  (or  result  in the  imposition  of any Lien  upon any of its
          assets),  except  in each  case as set  forth in  Section  4(d) of the
          Parent  Disclosure  Schedule or as would not  reasonably  be expected,
          individually or in the aggregate,  to have a Parent Materially Adverse
          Effect  (including  by reason  of any  cross-default).  Other  than in
          connection  with the  provisions  of the  Hart-Scott-Rodino  Act,  the
          Tennessee Business Corporation Act, the Tennessee Business Combination
          Act, the Nevada General  Corporation Law, the Securities Exchange Act,
          the  Securities  Act,  state   securities  laws,  and  the  rules  and
          regulations of The Nasdaq Stock Market,  neither the Parent nor any of
          its Subsidiaries needs to give any notice to, make any filing with, or
          obtain any  authorization,  consent,  or approval of any  Authority in
          order for the Parties to consummate the  transactions  contemplated by
          this Agreement.

     (e)  PARENT  PUBLIC  REPORTS.  The  Parent  has filed all  forms,  reports,
          schedules,  statements,  and documents required to be filed by it with
          the SEC  since  January  1, 1998  (collectively,  the  "Parent  Public
          Reports").  Each of the Parent  Public  Reports has complied  with the
          Securities  Act  and  the  Securities  Exchange  Act in  all  material
          respects.  None of the Parent Public Reports,  as of their  respective
          dates (or if amended  or  superseded,  at the time of such  subsequent
          filing),  contained any untrue statement of a material fact or omitted
          to state a material  fact  necessary  in order to make the  statements
          made  therein,  in light of the  circumstances  under  which they were
          made,  not  misleading.  The Parent  has  delivered  to the  Company a
          correct and complete copy of each Parent Public Report  (together with
          all exhibits and schedules thereto and as amended to date).

     (f)  FINANCIAL  STATEMENTS.  Each of the  audited and  unaudited  financial
          statements  included in or  incorporated  by reference into the Parent
          Public  Reports  (including  the  related  notes  and  schedules)  (i)
          complied in all material respects with applicable  requirements of the
          SEC with respect  thereto;  (ii) have been prepared in accordance with
          GAAP  applied on a consistent  basis  throughout  the periods  covered
          thereby;  and (iii)  present  fairly the  financial  condition  of the
          Parent and its  Subsidiaries as of the indicated dates and the results
          of  operations  of the Parent and its  Subsidiaries  for the indicated
          periods, provided, however, that the interim statements are subject to
          normal and recurring  year-end  adjustments  that have not been and to
          the Parent's Knowledge will not be material.

                                       31
<PAGE>
     (g)  EVENTS  SUBSEQUENT TO MOST RECENT FISCAL  QUARTER END.  Since the Most
          Recent Fiscal Quarter End, there has not been any event, circumstance,
          act, or omission that has resulted in, or reasonably would be expected
          to result in, a Parent Materially Adverse Effect.

     (h)  UNDISCLOSED   LIABILITIES.   Neither   the   Parent  nor  any  of  its
          Subsidiaries  has  liabilities or obligations of any nature,  (whether
          known or unknown, whether asserted or unasserted,  whether absolute or
          contingent,  whether  accrued  or  unaccrued,  whether  liquidated  or
          unliquidated,  and  whether  due  or to  become  due),  including  any
          liability for Taxes,  which  individually  or in the  aggregate  would
          reasonably  be expected to have a Parent  Materially  Adverse  Effect,
          except for (i)  liabilities set forth on the face of the balance sheet
          dated as of the Most Recent  Fiscal  Quarter  End (rather  than in any
          notes  thereto)  and  filed  in  the  Parent  Public   Reports;   (ii)
          liabilities  or  obligations  which have arisen  after the Most Recent
          Fiscal  Quarter End in the Ordinary  Course of Business (none of which
          results from,  arises out of,  relates to, is in the nature of, or was
          caused  by  any  breach  of  contract,   breach  of  warranty,   tort,
          infringement,   or  violation  of  Law);  and  (iii)   liabilities  or
          obligations  set  forth  in  Section  4(h)  of the  Parent  Disclosure
          Schedule.

      (i) BROKERS' FEES.  Neither the Parent nor any of its Subsidiaries has any
          liability or obligation to pay any fees or  commissions to any broker,
          finder, or agent with respect to the transactions contemplated by this
          Agreement for which the Company could become liable or obligated.

     (j)  DISCLOSURE.  None  of  the  information  supplied  by the  Parent  for
          inclusion in the Registration Statement or any amendment or supplement
          thereto,  shall,  at the time  such  document  is  filed,  at the time
          amended or supplemented and at the time the Registration  Statement is
          declared  effective  by the SEC,  contain  any untrue  statement  of a
          material fact or omit to state any material fact required to be stated
          therein or necessary in order to make the statements therein, in light
          of the circumstances under which they were made, not misleading.  None
          of  the  information  supplied  by the  Parent  for  inclusion  in the
          Definitive Proxy Materials shall, on the date such materials are first
          mailed to the  stockholders of the Company and Parent,  at the time of
          the Special  Meetings,  and at the Effective Time,  contain any untrue
          statement  of a  material  fact or omit to  state  any  material  fact
          required  to be  stated  therein  or  necessary  in  order to make the
          statements therein, in light of the circumstances under which they are
          made,  not  false or  misleading  or omit to state any  material  fact
          necessary to correct any statement in any earlier  communication  with
          respect to the Special  Meetings which has become false or misleading.
          If at any time prior to the Effective  Time any event  relating to the
          Parent or any of its  respective  Affiliates,  officers  or  directors

                                       32
<PAGE>
          should be  discovered  by the Parent  which  should be set forth in an
          amendment or supplement to the Registration  Statement or an amendment
          or  supplement to the  Definitive  Proxy  Materials,  the Parent shall
          promptly inform Company and Merger Sub. The Definitive Proxy Materials
          shall comply in all material  respects as to form and  substance  with
          the  requirements of the Exchange Act and the regulations  promulgated
          thereunder.   Notwithstanding  the  foregoing,  the  Parent  makes  no
          representation or warranty with respect to any information supplied by
          Parent or Merger Sub which is contained in the Registration  Statement
          or Definitive Proxy Materials.

     (k)  EMPLOYEE BENEFIT PLANS.

           (i) Section  4(k)  of  the  Parent  Disclosure  Schedule  includes  a
               complete list of all Parent Benefit Plans.

          (ii) With  respect to each  Parent  Benefit  Plan,  the  Parent  shall
               provide  prior to the Closing a true,  correct and complete  copy
               of: (i) all plan documents,  benefit schedules, trust agreements,
               and insurance contracts and other funding vehicles; (ii) the most
               recent  Annual   Report  (Form  5500  Series)  and   accompanying
               schedule, if any; (iii) the current summary plan description,  if
               any; (iv) the most recent annual  financial  report,  if any; (v)
               the  most  recent  actuarial  report,  if any;  and (vi) the most
               recent determination letter from the IRS, if any.

         (iii) The Parent and each of its Subsidiaries has complied,  and is now
               in compliance in all material  respects  with,  all provisions of
               ERISA,  the Code,  and all Laws  applicable to the Parent Benefit
               Plans.  With respect to each Parent Benefit Plan that is intended
               to be a "qualified  plan" within the meaning of Section 401(a) of
               the Code,  the IRS has issued a favorable  determination  letter,
               and to the  Knowledge  of the Parent  nothing has occurred at the
               date hereof that  reasonably  would be expected to cause the loss
               of such qualification.

          (iv) All contributions  required to be made to any Parent Benefit Plan
               by applicable  Law or by any plan  document or other  contractual
               undertaking,  and all  premiums  due or payable  with  respect to
               insurance  policies  funding  any Parent  Benefit  Plan,  for any
               period  through  the date hereof have been timely made or paid in
               full or,  to the  extent  not  required  to be made or paid on or
               before  the  date  hereof,  have  been  fully  reflected  in  the
               financial  statements of the Parent included in the Parent Public
               Reports to the extent required under GAAP.

          (v)  With  respect  to each  Parent  Benefit  Plan which is subject to
               Title  IV or  Section  302 of ERISA  or  Section  412 of the Code
               maintained or contributed  to (or required to be contributed  to)
               by the Parent, any of its Subsidiaries or any ERISA Affiliate (as
               hereinafter  defined),  (i) there does not now exist,  nor do any

                                       33
<PAGE>
               circumstances  exist that could  result in, any  liability of the
               Parent or any of its Subsidiaries  under Title IV of ERISA (other
               than for the  payment  of  premiums,  all of which have been paid
               when due),  (ii)  neither the Parent nor any of its  Subsidiaries
               has  incurred  any  accumulated  funding  deficiency  within  the
               meaning  of  Section  302 of  ERISA  or  Section  412 of the Code
               (whether  or  not  waived)  and  there  has  been  no  waiver  or
               application  for a waiver  of any  minimum  funding  standard  or
               extension of any  amortization  period  under  Section 412 of the
               Code or  Part 3 of  Subtitle  B of  Title I of  ERISA,  (iii)  no
               "reportable  event" (as such term is  defined in Section  4043 of
               ERISA and the regulations thereunder) has occurred or is expected
               to occur,  (iv) no notice of intent to  terminate  has been filed
               with the Pension Benefit  Guaranty  Corporation,  (v) the Pension
               Benefit  Guaranty  Corporation has not instituted any proceedings
               to terminate the plan or to appoint a trustee to  administer  the
               plan, and (vi) there has been no event requiring disclosure under
               Section 4063(a) of ERISA.  For purposes of this Section 4(k), the
               term "ERISA Affiliate" shall mean any business or entity (whether
               or not  incorporated)  which is a member of the same  "controlled
               group of corporations," under "common control," or an "affiliated
               service group" with the Parent or any of its Subsidiaries  within
               the  meaning of  Section  414(b),  (c) or (m) of the Code,  or is
               under "common control" with the Parent or any of its Subsidiaries
               within the meaning of Section 4001(a)(14) of ERISA.

          (vi) Neither  the  Parent  nor any of its  Subsidiaries  nor any ERISA
               Affiliate  has been  required to  contribute  to, or incurred any
               withdrawal  liability  (within  the  meaning of  Section  4201 of
               ERISA) with respect to any plan which is a multiemployer  plan as
               defined in Section 3(37) of ERISA.  Neither the Parent nor any of
               its  Subsidiaries  nor any  ERISA  Affiliate  has  completely  or
               partially withdrawn from any Multiemployer Plan. No Multiemployer
               Plan as to which the Parent, any of its Subsidiaries or any ERISA
               Affiliate is required to contribute is in  reorganization  within
               the  meaning of Part 3 of  Subtitle  E of Title IV of ERISA.  The
               Parent  shall  deliver to the Company,  prior to the  Closing,  a
               schedule  showing the  contributions  of the  Parent,  any of its
               Subsidiaries,   and  any   ERISA   Affiliates   to  each  of  the
               Multiemployer Plans for the most recent five plan years.

         (vii) There are no pending actions,  claims or lawsuits which have been
               asserted,   instituted  or,  to  the  Knowledge  of  the  Parent,
               threatened  in  connection  with any of the Parent  Benefit Plans
               (other than routine claims for benefits) which  reasonably  would
               be expected,  individually  or in the  aggregate,  to result in a
               Parent Materially Adverse Effect.

        (viii) Neither  the  Parent nor  any of its  Subsidiaries  maintains  or
               contributes to any plan or arrangement  which provides or has any
               liability to provide life  insurance or medical or other  welfare
               benefits to any  employee,  former  employee,  director or former

                                       34
<PAGE>
               director  upon his  retirement  or  termination  of service,  and
               neither  the  Parent  nor  any  of  its   Subsidiaries  has  ever
               represented,  promised, or contracted (whether in oral or written
               form)  to any  employee,  former  employee,  director  or  former
               director that such benefits would be provided.

          (ix) The Parent and its Subsidiaries are in compliance in all material
               respects with the continuation coverage provisions of Section 601
               et seq. of ERISA and Section 4980B of the Code.

     (l)  EMPLOYMENT AND LABOR MATTERS.

           (i) Except  as set forth in  Section  4(l) of the  Parent  Disclosure
               Schedule,  there  are  no  employment,   consulting,   collective
               bargaining,  severance  pay,  continuation  pay,  termination  or
               indemnification  agreements  or other  similar  contracts  of any
               nature  (whether  in  writing or not)  between  the Parent or any
               Subsidiary  and  any  current  or  former  stockholder,  officer,
               director,  employee,  consultant,  labor  organization  or  other
               representative of any of the Parent's or Subsidiary's  employees,
               nor is any such contract  presently being  negotiated.  Except as
               set forth in Section 4(l) of the Parent Disclosure  Schedule,  no
               individual will accrue or receive additional benefits, service or
               accelerated  rights to payments  under any Benefit Plan or any of
               the agreements set forth in Section 4(l) of the Parent Disclosure
               Schedule,  including the right to receive any parachute  payment,
               as defined in Section  280G of the Code,  or become  entitled  to
               severance,  termination allowance or similar payments as a result
               of the  Merger  that  could  result  in the  payment  of any such
               benefits or payments.  Neither the Parent nor any  Subsidiary  is
               delinquent in payments to any of its employees or consultants for
               any wages,  salaries,  commissions,  bonuses,  benefits  or other
               compensation  for any  services or  otherwise  arising  under any
               policy, practice,  agreement, plan, program or Law. Except as set
               forth in Section 4(l) of the Parent Disclosure Schedule,  neither
               the Parent nor any  Subsidiary is liable for any severance pay or
               other  payments to any employee or former  employee  arising from
               the  termination  of  employment,  nor  will  the  Parent  or any
               Subsidiary  have any  liability  under any  benefit or  severance
               policy,  practice,  agreement,  plan,  or program which exists or
               arises, or may be deemed to exist or arise,  under any applicable
               Law or  otherwise,  as a  result  of or in  connection  with  the
               transactions  contemplated  hereunder  or  as  a  result  of  the
               termination  by the  Parent  or  any  Subsidiary  of any  Persons
               employed  by the  Parent  or any  Subsidiary  on or  prior to the
               Effective Time.

          (ii) Except  as set forth in  Section  4(l) of the  Parent  Disclosure
               Schedule,  none of the  Parent's or any  Subsidiary's  employment
               policies or practices is currently  being audited or investigated
               by any  Authority.  Except  as set forth in  Section  4(l) of the
               Parent  Disclosure  Schedule,  there  is no  pending  or,  to the

                                       35
<PAGE>
               Knowledge  of the Parent,  threatened  Litigation,  unfair  labor
               practice charge, or other charge or inquiry against the Parent or
               any  Subsidiary   brought  by  or  on  behalf  of  any  employee,
               prospective   employee,    former   employee,    retiree,   labor
               organization  or  other   representative  of  the  Parent  's  or
               Subsidiary's  employee, or other individual or any Authority with
               respect  to  employment   practices  brought  by  or  before  any
               Authority.  Except as set  forth in  Section  4(l) of the  Parent
               Disclosure  Schedule,  there  are  no  controversies  pending  or
               threatened, between the Parent or any of its Subsidiaries and any
               of their respective employees;  neither the Parent nor any of its
               Subsidiaries is a party to any collective bargaining agreement or
               other labor union contract  applicable to Persons employed by the
               Parent  or its  Subsidiaries  nor are  there  any  activities  or
               proceedings  of any labor union to organize any such employees of
               the Parent or any of its Subsidiaries; during the past five years
               there have been no strikes, slowdowns, work stoppages,  disputes,
               lockouts, or threats thereof, by or with respect to any employees
               of the Parent or any of its Subsidiaries.  Except as set forth in
               Section  4(l) of the  Parent  Disclosure  Schedule,  there are no
               grievances  pending  or, to the  Knowledge  of the  Parent or any
               Subsidiary,  threatened,  which could  reasonably  be expected to
               have a Parent Materially  Adverse Effect.  Neither the Parent nor
               any Subsidiary is a party to, or otherwise  bound by, any consent
               decree  with,  or  citation  or other  Order  by,  any  Authority
               relating to employees  or  employment  practices.  The Parent and
               each  of its  Subsidiaries  are  in  compliance  in all  material
               respects  with  all  applicable  Laws,  contracts,  and  policies
               relating to employment.

     (m)  ENVIRONMENTAL  MATTERS.  Except  as set forth in  Section  4(m) of the
          Parent  Disclosure  Schedule  or  except as would  not  reasonably  be
          expected,   individually  or  in  the  aggregate,  to  have  a  Parent
          Materially Adverse Effect, (i) no Hazardous  Materials are present at,
          on or under any real property currently or, to the Parent's Knowledge,
          formerly  owned,  leased,  or  operated  by the  Parent  or any of its
          Subsidiaries  to an extent or in a manner or condition  now  requiring
          investigation,  response,  corrective  action, or other action, or, to
          the Parent's  Knowledge,  that could result in liability  of, or costs
          to, the  Parent or any of its  Subsidiaries,  under any  Environmental
          Law;  (ii) there is currently no civil,  criminal,  or  administrative
          action,  suit,  demand,  hearing,   proceeding  notice  of  violation,
          investigation,  notice or demand  letter,  or request for  information
          pending  or to the  Knowledge  of the  Parent,  threatened,  under any
          Environmental Law against the Parent or any of its Subsidiaries, (iii)
          the  Parent  and its  Subsidiaries  have not  received  any  claims or
          notices alleging liability under any Environmental Law, and the Parent
          has no  Knowledge  of  any  circumstances  that  would  reasonably  be
          expected to result in such claims or notices, (iv) the Parent and each
          of its Subsidiaries are currently in compliance, and within the period
          of applicable statutes of limitation have complied,  with all, and, to
          the  Parent's  Knowledge,  have no  liability  under  any,  applicable

                                       36
<PAGE>
          Environmental  Laws,  (v) the Parent has not been  notified  about any
          property or facility currently or, to the Parent's Knowledge as of the
          date hereof,  formerly owned, leased, or operated by the Parent or any
          of    its     Subsidiaries     or    any    of    their     respective
          predecessors-in-interest,  or at  which  Hazardous  Materials  of  the
          Parent  or any of its  Subsidiaries  have  been  stored,  treated,  or
          disposed  of is  listed  or  proposed  for  listing  on  the  National
          Priorities   List  or  the   Comprehensive   Environmental   Response,
          Compensation and Liability  Information System, both promulgated under
          the Comprehensive  Environmental Response,  Compensation and Liability
          Act of 1980, as amended,  or on any  comparable  state or foreign list
          established under any Environmental Law, (vi) the execution, delivery,
          and  performance  of  this  Agreement  and  the  consummation  of  the
          transactions  contemplated  hereby  will not  affect the  validity  or
          require the transfer of any  Environmental  Permits held by the Parent
          or any of its  Subsidiaries,  and will not require  any  notification,
          disclosure,    registration,    reporting,   filing,    investigation,
          remediation,  or other action under any  Environmental  Law,  (vii) no
          friable  asbestos is present in, on, or at any  property,  facility or
          equipment of the Parent or any of its  Subsidiaries,  (viii) there are
          no past or present events, conditions,  activities, or practices which
          could   reasonably   be   expected  to  prevent  the  Parent  and  its
          Subsidiaries'  compliance with any  Environmental  Law, or which would
          reasonably  be expected to give rise to any liability of the Parent or
          any of its Subsidiaries  under any Environmental Law, (ix) no Lien has
          been asserted or recorded,  or to the Knowledge of the Parent and each
          of its  Subsidiaries  threatened,  under  any  Environmental  Law with
          respect to any assets,  facility,  inventory,  or  property  currently
          owned,  leased or operated  by the Parent or any of its  Subsidiaries,
          (x)  neither  the Parent nor any of its  Subsidiaries  has  assumed by
          contract or agreement any liabilities or obligations arising under any
          Environmental Law including,  without limitation, any such liabilities
          or obligations with respect to formerly owned, leased or operated real
          property or  facilities,  or former  divisions or  Subsidiaries,  (xi)
          neither the Parent nor any of its  Subsidiaries  has  entered  into or
          agreed  to  any   judgment,   decree  or  Order  by  any  judicial  or
          administrative  tribunal  or agency and  neither the Parent nor any of
          its  Subsidiaries  is  subject  to any  judgment,  decree,  Order,  or
          agreement,  in each case relating to compliance with any Environmental
          Law or requiring the Parent or any of its  Subsidiaries to conduct any
          investigation,  response,  corrective  or other action with respect to
          any Hazardous  Materials under any Environmental  Law, and (xii) other
          than  disclosed  on Schedule  4(m) of the Parent  Disclosure  Schedule
          there are no underground  storage tanks or above-ground  storage tanks
          or related piping at any real property owned,  operated,  or leased by
          the Parent or any of its  Subsidiaries,  and any former such tanks and
          piping on any such  property  which have been removed or closed,  have
          been removed or closed in  accordance  with  applicable  Environmental
          Laws.

          The Parent has made  available  to the  Company all records and files,
          including,  but not limited  to, all  assessments,  reports,  studies,
          audits, analyses,  tests, and data in the possession or control of the
          Parent  or any of  its  Subsidiaries  relating  to  the  existence  of

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          Hazardous Materials at facilities or properties  currently or formerly
          owned,  operated,  leased  or  used  by  the  Parent  or  any  of  its
          Subsidiaries or in any way concerning compliance by the Parent and any
          of its  Subsidiaries  with,  or liability of any of them,  under,  any
          Environmental Law.

     (n)  MATERIAL AGREEMENTS. Except as described in Section 4(n) of the Parent
          Disclosure  Schedule,  there are no  agreements  of the  Parent or its
          Subsidiaries   (i) containing an unexpired  covenant not to compete or
          similar restriction applying to the Parent or any of its Subsidiaries;
          (ii) providing for interest rate, currency, or commodity hedging, swap
          or  similar  derivative  transactions  to  which  the  Parent  or  its
          Subsidiaries  is  a  party;  (iii)  providing  for  payment  based  on
          revenues,  sales or  profits;  (iv)  between  the Parent or any of its
          Subsidiaries, on the one hand, and any Affiliate of the Parent, on the
          other hand; (v) which,  if terminated by the Parent upon not more than
          30 days'  notice  would result in liability to the Parent of more than
          $1  million;  or (vi) that would be  required to be filed and have not
          been filed as an  exhibit to a Form 10-K filed by the Parent  with the
          SEC as of the  date  of  this  Agreement  (collectively,  the  "Parent
          Material   Agreements").   Assuming  each  Parent  Material  Agreement
          constitutes  a  valid  and  binding  obligation  of each  other  party
          thereto,  each  Parent  Material  Agreement  is a  valid  and  binding
          obligation of the Parent or the applicable Subsidiary, as the case may
          be. To the Parent's  Knowledge,  each Parent  Material  Agreement is a
          valid and binding  obligation  of each other party  thereto,  and each
          such Parent  Material  Agreement  is in full force and effect.  To the
          Knowledge  of  the  Parent,   there  are  no  existing   defaults  (or
          circumstances  or events  that,  with the giving of notice or lapse of
          time or both would become defaults) of the Parent, any Subsidiary,  or
          any third party under any of the Parent Material Agreements.

     (O)  TAX MATTERS. With respect to Taxes except as set forth in Section 4(o)
          of the Parent Disclosure Schedule:

           (i) To the best Knowledge of the Parent, the Parent has filed, within
               the  time  and in the  manner  prescribed  by  Law,  all  Returns
               required to be filed under  applicable  Law, and all such Returns
               are true, correct,  and complete.  The Parent has within the time
               and in the manner  prescribed by Law, paid all Taxes that are due
               and payable with respect to it and its  consolidated  group.  The
               Parent has  established on the balance sheet dated as of the Most
               Recent Fiscal  Quarter End reserves,  charges,  and accruals that
               are adequate for the payment of all Taxes not yet due and payable
               that are  attributable to periods ending on such date.  There are
               no Liens for Taxes  upon the  assets of the  Parent or the Merger
               Sub, except for Liens for Taxes not yet delinquent.

          (ii) To the best Knowledge of the Parent, no action, suit, proceeding,
               investigation,  claim  or audit  has  formally  commenced  and no
               written notice has been given that such audit or other proceeding
               is pending or threatened with respect to the Parent or any of its

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<PAGE>
               Subsidiaries  or any  group of  corporations  of which any of the
               Parent and its  Subsidiaries  has been a member in respect of any
               Taxes, and all deficiencies proposed as a result of such actions,
               suits,  proceedings,  investigations,  claims or audits have been
               paid,  reserved  against  or  settled.  There are no  outstanding
               waivers or comparable  consents  regarding the application of the
               statute of  limitations  with  respect to any Tax or Return  that
               have been requested or given by or that relate to the Parent.

         (iii) The Parent and, if applicable,  its agents and contracted service
               providers, have complied in all respects with all applicable Laws
               relating to the payment and withholding of Taxes and have, within
               the  time  and  in  the  manner  prescribed  by  applicable  Law,
               withheld,  collected,  and paid over to the proper  Authority all
               amounts  required  to be so  withheld,  collected,  and paid over
               under all applicable Laws.

          (iv) The Parent and its Subsidiaries  have not made any payments,  are
               not  obligated to make any  payments,  and are not a party to any
               agreements  that under any  circumstances  could  obligate any of
               them to make any  payments,  that  will not be  deductible  under
               Section  280G of the  Code.  Neither  the  Parent  nor any of its
               Subsidiaries  has made an election  under  Section  341(f) of the
               Code. None of the Parent and its Subsidiaries will be required to
               include  any  material  amount in taxable  income for any taxable
               period (or portion  thereof)  ending  after the Closing Date as a
               result of a change  in the  method  of  accounting  for a taxable
               period ending prior to the Closing Date, any "closing  agreement"
               as described  in Section  7121 of the Code (or any  corresponding
               provision of state, local or foreign Tax Laws) entered into prior
               to the Closing Date, any sale reported on the installment  method
               that occurred  prior to the Closing  Date, or any taxable  income
               attributable to any amount that is economically  accrued prior to
               the Closing Date.

     (p)  INSURANCE;  BONDS.  Section  4(p) of the  Parent  Disclosure  Schedule
          contains  a list  of,  and the  Company  has been  furnished  true and
          complete copies of, all material insurance policies and fidelity bonds
          covering  the  Parent's  assets,  business,  properties,   operations,
          employees,  officers,  and directors,  and other matters for which the
          Parent  carries  insurance.  Section  4(p)  of the  Parent  Disclosure
          Schedule describes any self-insurance  arrangement by or affecting the
          Parent,  including any reserves established  thereunder,  covering any
          years in which  there are  outstanding  claims  (the  earliest of such
          years  referred to as the "Parent Base Year").  Except as set forth in
          Section 4(p) of the Parent Disclosure  Schedule,  there is no claim by
          any insured  pending  under any of such  policies or bonds as to which
          coverage has been questioned,  denied, or disputed by the underwriters
          of such  policies  or  bonds.  All  premiums  payable  under  all such
          policies and bonds have been paid, and the Parent is otherwise in full
          compliance  with the terms and  conditions  of all such  policies  and
          bonds.  As to all claims  that might be  covered by such  policies  or

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<PAGE>
          bonds,  the Parent has promptly and within any prescribed  time period
          notified the insuring or bonding  party in the proper  manner.  Except
          for claims listed on Section 4(p) of the Parent  Disclosure  Schedule,
          there have been no notices given to the insurer of any claims that may
          be insured by insurer.  Such policies of insurance and bonds (or other
          policies and bonds providing substantially similar insurance coverage)
          have been in effect  continuously  since the  beginning  of the Parent
          Base Year,  and  remain in full force and  effect.  Such  policies  of
          insurance and bonds are of the type and in amounts customarily carried
          by Persons  conducting  similar businesses and do not exclude coverage
          for  punitive  damages.  Except  as set forth in  Section  4(p) of the
          Parent Disclosure Schedule,  there is no threatened termination of, or
          premium increase with respect to, any of such policies or bonds.

     (q)  COMPLIANCE.  The Parent and each of its Subsidiaries are in compliance
          with,  and are not in default or  violation  of, (i) its  Charter  and
          bylaws or the equivalent  organizational documents of such Subsidiary,
          (ii)  any Law or Order by which  any of  their  respective  assets  or
          properties  are bound or  affected,  and (iii) the terms of all notes,
          bonds, mortgages, indentures, contracts, permits, franchises and other
          instruments or obligations to which any of them is a party or by which
          any of them or any of their  respective  assets or properties is bound
          or affected,  except,  in the case of clauses (ii) and (iii),  for any
          such failures of compliance,  defaults and violations which could not,
          individually  or in the  aggregate,  reasonably  be expected to have a
          Parent Materially  Adverse Effect. The Parent and its Subsidiaries are
          in compliance with the terms of all approvals of  Authorities,  except
          where the  failure  to so comply  could  not,  individually  or in the
          aggregate,  reasonably be expected to have a Parent Materially Adverse
          Effect.  Except as set forth in Section 4(q) of the Parent  Disclosure
          Schedule or as could not, individually or in the aggregate, reasonably
          be expected to have a Parent  Materially  Adverse Effect,  neither the
          Parent  nor  any  of  its  Subsidiaries  has  received  notice  of any
          revocation  or  modification  of  any  license,  permit,  consent,  or
          approval of any Authority that is material to the Parent or any of its
          Subsidiaries.

     (r)  ABSENCE OF  LITIGATION.  Except as  described  in Section  4(r) of the
          Parent Disclosure Schedule or expressly described in the Parent Public
          Reports filed and publicly  available prior to the date hereof,  there
          is no Litigation  pending on behalf of or against or, to the Knowledge
          of the Parent, threatened against the Parent, any of its Subsidiaries,
          or any of their respective  properties or rights, before or subject to
          any court or governmental  Authority  which could,  individually or in
          the  aggregate,  reasonably  be expected  to have a Parent  Materially
          Adverse  Effect.  Neither  the Parent nor any of its  Subsidiaries  is
          subject to any outstanding Litigation or Order which,  individually or
          in the  aggregate,  has had or could  reasonably be expected to have a
          Parent Materially Adverse Effect.

     (s)  TITLE TO ASSETS.  Except as  described  in Section  4(s) of the Parent
          Disclosure Schedule,  the Parent and each of its Subsidiaries has good
          and  marketable  title to all of  their  real or  personal  properties

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<PAGE>
          (whether  owned or  leased)  and  assets,  free and clear of all Liens
          other than Liens  which are  reflected  on the  Parent's  consolidated
          balance  sheet  filed in its Form  10-Q  for the  Most  Recent  Fiscal
          Quarter End.

     (t)  POOLING; TAX MATTERS.

           (i) The Parent  intends  that the Merger be  accounted  for under the
               "pooling of interests"  method under the  requirements of Opinion
               No. 16 (Business Combinations) of the Accounting Principles Board
               of the American  Institute of Certified Public  Accountants,  the
               Financial  Accounting Standards Board, and the Regulations of the
               SEC.

          (ii) To the Knowledge of the Parent, neither the Parent nor any of its
               Affiliates has taken or agreed to take any action, failed to take
               any  action or is aware of any fact or  circumstance  that  would
               prevent   (i) the  Merger  from  being   treated  for   financial
               accounting  purposes as a "pooling of  interests"  in  accordance
               with GAAP and the regulations of the SEC; provided, that the sale
               of Parent Shares described in Section 5(i) are taken; or (ii) the
               Merger from  constituting a reorganization  within the meaning of
               Section 368(a) of the Code.

         (iii) Assuming  the  issuance  of Parent  Shares  described  in Section
               5(i),  the Parent has no  Knowledge  of any reason why it may not
               receive a letter from its independent accountants dated as of the
               Closing   Date  and   addressed  to  the  Parent  in  which  such
               accountants will concur with the Parent's management's conclusion
               that  no  conditions  exist  related  to the  Parent  that  would
               preclude  Parent from  accounting for the Merger as a "pooling of
               interests."

          (iv) Section 4(t) of the Parent  Disclosure  Schedule  contains a true
               and  complete  list of all Persons  who, to the  Knowledge of the
               Parent,  may be deemed to be Affiliates of the Parent,  excluding
               all of its Subsidiaries but including all directors and executive
               officers of the Parent.

     (u)  INTELLECTUAL PROPERTY.

           (i) Except as would not,  individually  and in the aggregate,  have a
               Parent Materially  Adverse Effect, (i) the Parent and each of its
               Subsidiaries  owns,  has the right to acquire or is  licensed  or
               otherwise has the right to use (in each case,  clear of any Liens
               of any kind), all  Intellectual  Property (as defined below) used
               in or  necessary  for the conduct of its  business  as  currently
               conducted, (ii) no claims are pending or, to the Knowledge of the
               Parent,  threatened that the Parent or any of its Subsidiaries is
               infringing  on or  otherwise  violating  the rights of any Person
               with  regard  to  any  Intellectual  Property  and  (iii)  to the
               Knowledge of the Parent,  no Person is infringing on or otherwise

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<PAGE>
               violating any right of the Parent or any of its Subsidiaries with
               respect to any Intellectual  Property owned by and/or licensed to
               the Parent or its Subsidiaries.

          (ii) Section 4(u) of the Parent Disclosure  Schedule sets forth, as of
               the date  hereof,  a true and complete  list of all  Intellectual
               Property of the Parent and each of its Subsidiaries,  the loss or
               impairment  of  which  would  cause a Parent  Materially  Adverse
               Effect.

5.   COVENANTS. The Parties agree as follows with respect to the period from and
     after the execution of this Agreement.

     (a)  GENERAL.  Each of the  Parties  will use its best  efforts to take all
          action and to do all things  necessary,  proper, or advisable in order
          to consummate and make effective the transactions contemplated by this
          Agreement  (including  satisfaction,  but not  waiver,  of the Closing
          conditions set forth in Section 6 below).

     (b)  CONDUCT OF  BUSINESS  BY THE PARENT  PENDING  THE  MERGER.  The Parent
          covenants  and agrees that,  between the date hereof and the Effective
          Time,  except as expressly  required or permitted by this Agreement or
          unless Company shall otherwise agree in writing in advance, the Parent
          shall  conduct  and  shall  cause  the   businesses  of  each  of  its
          Subsidiaries  to  be  conducted  only  in,  and  the  Parent  and  its
          Subsidiaries  shall not take any action except in, the Ordinary Course
          of  Business  and in a manner  consistent  with past  practice  and in
          compliance  with  applicable  Law. The Parent shall use its reasonable
          best efforts to preserve intact the business  organization  and assets
          of the Parent and each of its Subsidiaries,  and to operate, and cause
          each of its  Subsidiaries  to operate,  according to plans and budgets
          provided to Company,  to keep  available  the  services of the present
          officers,  employees  and  consultants  of the  Parent and each of its
          Subsidiaries,  to  maintain  in  effect  material  agreements  and  to
          preserve  the  present  relationships  of the  Parent  and each of its
          Subsidiaries  with  advertisers,   sponsors,   customers,   licensees,
          suppliers  and  other  Persons  with  which  the  Parent or any of its
          Subsidiaries has business  relations.  By way of amplification and not
          limitation,  neither  the  Parent nor any of its  Subsidiaries  shall,
          between the date hereof and the Effective Time, directly or indirectly
          do, or propose to do, any of the  following  without the prior written
          consent of Company:

           (i) amend or  otherwise  change the  Charter or bylaws or  equivalent
               organizational  document of the Parent or any of its Subsidiaries
               or   alter   through   merger,    liquidation,    reorganization,
               restructuring or in any other fashion the corporate  structure or
               ownership of the Parent or any of its Subsidiaries;

          (ii) issue, grant, sell, transfer,  deliver,  pledge, promise, dispose
               of or encumber, or authorize the issuance, grant, sale, transfer,
               deliverance,  pledge, promise, disposition or encumbrance of, any
               shares of capital  stock of any class (common or  preferred),  or

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<PAGE>
               any options, warrants,  convertible or exchangeable securities or
               similar rights of any kind to acquire any shares of capital stock
               or any other  ownership  interest or similar rights of the Parent
               Shares or any of its  Subsidiaries  (except  for the  issuance of
               Parent Shares issuable  pursuant to the Outstanding  Parent Stock
               Options and the sale of approximately  2,000,000 Parent Shares to
               the public as  contemplated  by Section 5(i));  adopt,  ratify or
               effectuate a stockholders'  rights plan or agreement;  or redeem,
               purchase or otherwise acquire, directly or indirectly, any of the
               capital  stock of the Parent or interest in or  securities of any
               Subsidiary;

         (iii) declare,  set  aside or pay any  dividend  or other  distribution
               (whether in cash,  stock or property or any combination  thereof)
               in  respect of any of its  capital  stock  (except  that a wholly
               owned  Subsidiary of the Parent may declare and pay a dividend to
               the  Parent);  split,  combine or  reclassify  any of its capital
               stock, or issue or authorize the issuance of any other securities
               in respect of, in lieu of or in  substitution  for, shares of its
               capital  stock;  or amend  the terms  of,  repurchase,  redeem or
               otherwise acquire, or permit any Subsidiary to repurchase, redeem
               or otherwise acquire,  any of its securities or any securities of
               its Subsidiaries; or propose to do any of the foregoing;

          (iv) except as  disclosed  on Section  5(b) of the  Parent  Disclosure
               Schedule,  sell, transfer,  deliver, lease, license,  sublicense,
               mortgage,  pledge,  encumber or otherwise dispose of (in whole or
               in part), or create, incur, assume or subject any Lien on, any of
               the  assets of the Parent or any of its  Subsidiaries  (including
               any  Intellectual  Property),   except  in  connection  with  the
               acquisition or  disposition  of assets in the Ordinary  Course of
               Business, and in a manner consistent with past practice;

          (v)  except as otherwise  disclosed  to the Company  prior to the date
               hereof, acquire (by merger,  consolidation,  acquisition of stock
               or assets or  otherwise)  or organize  any  corporation,  limited
               liability  Parent,  partnership,  joint  venture,  trust or other
               entity or any business organization or division thereof;

          (vi) other  than  in  the  Ordinary  Course  of  Business,  incur  any
               indebtedness  for borrowed money or issue any debt  securities or
               any  warrants or rights to acquire  any debt  security or assume,
               guarantee  or endorse or  otherwise  as an  accommodation  become
               responsible  for,  the  obligations  of any  Person,  or make any
               loans,  advances  or enter  into any  financial  commitments;  or
               authorize or make any capital expenditures;

         (vii) hire or  terminate  any  employee  or  consultant,  except in the
               Ordinary Course of Business;  increase the compensation or fringe
               benefits  (including,  without  limitation,  bonus) payable or to

                                       43
<PAGE>
               become payable to its officers or employees, except for increases
               in salary or wages of employees of the Parent or its Subsidiaries
               who are not  officers  of the  Parent in the  Ordinary  Course of
               Business; or loan or advance any money or other asset or property
               to, or grant any bonus, severance or termination pay to, or enter
               into any  employment or severance  agreement  with, any director,
               officer  or  other   employee   of  the  Parent  or  any  of  its
               Subsidiaries, or establish, adopt, enter into, terminate or amend
               any Benefit  Plan or any  collective  bargaining,  bonus,  profit
               sharing,  thrift,  compensation,  stock option,  stock  purchase,
               restricted stock,  pension,  retirement,  deferred  compensation,
               employment,  termination,  severance  or other  plan,  agreement,
               trust, fund, policy or arrangement for the benefit of any current
               or former directors, officers or employees;

       (viii)  change  any   accounting   policies   or  procedures   (including
               procedures  with  respect  to  reserves,   revenue   recognition,
               payments  of  accounts   payable  and   collection   of  accounts
               receivable)  unless  required  by a change in Law or GAAP used by
               it;

          (ix) other  than in the  Ordinary  Course of  Business,  enter into or
               modify, amend,  terminate,  waive any rights under, or assign any
               material agreement,  including, but not limited to, any agreement
               with or for the direct or indirect benefit of any Affiliate.

          (x)  except as  disclosed  on Section  5(b) of the  Parent  Disclosure
               Schedule,  make any material Tax election or settle or compromise
               any Tax  liability  or  agree to an  extension  of a  statute  of
               limitations;

          (xi) pay, discharge, satisfy or settle any Litigation or waive, assign
               or release any material  rights or claims except any  settlements
               of routine liability, workers' compensation, physical damage, and
               cargo  claims  arising in the  Ordinary  Course of Business  that
               would not impose any injunctive or similar Order on the Parent or
               any of its  Subsidiaries  or restrict in any way the  business of
               the Parent or any of its Subsidiaries;

         (xii) fail to maintain in full force and effect all  self-insurance and
               insurance, as the case may be, currently in effect;

        (xiii) take (or fail  to take) any  action that  (without  regard to any
               action  taken,  or agreed  to be  taken,  by Parent or any of its
               Affiliates)  would  prevent  (i) Parent from  accounting  for the
               business  combination  to be effected by the Merger as a "pooling
               of   interests"   or  (ii)  the  Merger  from   qualifying  as  a
               reorganization  within the meaning of Section 368(a) of the Code;
               or

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<PAGE>
         (xiv) authorize,  recommend, propose or announce an intention to do any
               of the foregoing, or agree or enter into or amend any contract or
               arrangement to do any of the foregoing.

     (c)  CONDUCT OF  BUSINESS BY THE  COMPANY  PENDING THE MERGER.  The Company
          covenants  and agrees that,  between the date hereof and the Effective
          Time,  except as expressly  required or permitted by this Agreement or
          unless Parent shall otherwise agree in writing in advance, the Company
          shall  conduct  and  shall  cause  the   businesses  of  each  of  its
          Subsidiaries  to be  conducted  only  in,  and  the  Company  and  its
          Subsidiaries  shall not take any action except in, the Ordinary Course
          of  Business  and in a manner  consistent  with past  practice  and in
          compliance  with  applicable Law. The Company shall use its reasonable
          best efforts to preserve intact the business  organization  and assets
          of the Company and each of its Subsidiaries, and to operate, and cause
          each of its  Subsidiaries  to operate,  according to plans and budgets
          provided  to Parent,  to keep  available  the  services of the present
          officers,  employees  and  consultants  of the Company and each of its
          Subsidiaries,  to  maintain  in  effect  material  agreements  and  to
          preserve  the  present  relationships  of the  Company and each of its
          Subsidiaries  with  advertisers,   sponsors,   customers,   licensees,
          suppliers  and other  Persons  with  which the  Company  or any of its
          Subsidiaries has business  relations.  By way of amplification and not
          limitation,  neither the Company  nor any of its  Subsidiaries  shall,
          between the date hereof and the Effective Time, directly or indirectly
          do, or propose to do, any of the  following  without the prior written
          consent of Parent:

           (i) amend or  otherwise  change the  Charter or bylaws or  equivalent
               organizational document of the Company or any of its Subsidiaries
               or   alter   through   merger,    liquidation,    reorganization,
               restructuring or in any other fashion the corporate  structure or
               ownership of the Company or any of its Subsidiaries;

          (ii) issue, grant, sell, transfer,  deliver,  pledge, promise, dispose
               of or encumber, or authorize the issuance, grant, sale, transfer,
               deliverance,  pledge, promise, disposition or encumbrance of, any
               shares of capital  stock of any class (common or  preferred),  or
               any options, warrants,  convertible or exchangeable securities or
               similar rights of any kind to acquire any shares of capital stock
               or any other ownership  interest or similar rights of the Company
               Shares or any of its  Subsidiaries  (except  for the  issuance of
               Company Shares issuable pursuant to the Outstanding Company Stock
               Options and the sale of  approximately  300,000 Company Shares to
               the public as  contemplated  by Section 5(i));  adopt,  ratify or
               effectuate a stockholders'  rights plan or agreement;  or redeem,
               purchase or otherwise acquire, directly or indirectly, any of the
               capital  stock of the Company or interest in or securities of any
               Subsidiary;

         (iii) declare,  set  aside or pay any  dividend  or other  distribution
               (whether in cash,  stock or property or any combination  thereof)
               in  respect of any of its  capital  stock  (except  that a wholly

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<PAGE>
               owned Subsidiary of the Company may declare and pay a dividend to
               the Company);  split,  combine or  reclassify  any of its capital
               stock, or issue or authorize the issuance of any other securities
               in respect of, in lieu of or in  substitution  for, shares of its
               capital  stock;  or amend  the terms  of,  repurchase,  redeem or
               otherwise acquire, or permit any Subsidiary to repurchase, redeem
               or otherwise acquire,  any of its securities or any securities of
               its Subsidiaries; or propose to do any of the foregoing;

          (iv) sell, transfer,  deliver, lease, license,  sublicense,  mortgage,
               pledge,  encumber or otherwise  dispose of (in whole or in part),
               or  create,  incur,  assume or  subject  any Lien on,  any of the
               assets of the Company or any of its  Subsidiaries  (including any
               Intellectual Property), except in connection with the acquisition
               or disposition of assets in the Ordinary Course of Business,  and
               in a manner consistent with past practice;

          (v)  acquire (by merger, consolidation, acquisition of stock or assets
               or  otherwise)  or organize any  corporation,  limited  liability
               company, partnership, joint venture, trust or other entity or any
               business organization or division thereof;

          (vi) other  than  in  the  Ordinary  Course  of  Business,  incur  any
               indebtedness  for borrowed money or issue any debt  securities or
               any  warrants or rights to acquire  any debt  security or assume,
               guarantee  or endorse or  otherwise  as an  accommodation  become
               responsible  for,  the  obligations  of any  Person,  or make any
               loans,  advances  or enter  into any  financial  commitments;  or
               authorize or make any capital expenditures;

         (vii) hire or  terminate  any  employee  or  consultant,  except in the
               Ordinary Course of Business;  increase the compensation or fringe
               benefits  (including,  without  limitation,  bonus) payable or to
               become payable to its officers or employees, except for increases
               in  salary  or  wages  of   employees   of  the  Company  or  its
               Subsidiaries  who are not officers of the Company in the Ordinary
               Course of  Business;  or loan or advance any money or other asset
               or property to, or grant any bonus,  severance or termination pay
               to, or enter into any employment or severance agreement with, any
               director,  officer or other employee of the Company or any of its
               Subsidiaries, or establish, adopt, enter into, terminate or amend
               any Benefit  Plan or any  collective  bargaining,  bonus,  profit
               sharing,  thrift,  compensation,  stock option,  stock  purchase,
               restricted stock,  pension,  retirement,  deferred  compensation,
               employment,  termination,  severance  or other  plan,  agreement,
               trust, fund, policy or arrangement for the benefit of any current
               or former directors, officers or employees;

       (viii)  change  any   accounting   policies   or  procedures   (including
               procedures  with  respect  to  reserves,   revenue   recognition,
               payments  of  accounts   payable  and   collection   of  accounts
               receivable)  unless  required  by a change in Law or GAAP used by
               it;

                                       46
<PAGE>
          (ix) other  than in the  Ordinary  Course of  Business,  enter into or
               modify, amend,  terminate,  waive any rights under, or assign any
               material agreement,  including, but not limited to, any agreement
               with or for the direct or indirect benefit of any Affiliate.

          (x)  make any material Tax  election or settle or  compromise  any Tax
               liability or agree to an extension of a statute of limitations;

          (xi) pay, discharge, satisfy or settle any Litigation or waive, assign
               or release any material  rights or claims except any  settlements
               of routine liability, workers' compensation, physical damage, and
               cargo  claims  arising in the  Ordinary  Course of Business  that
               would not impose any  injunctive  or similar Order on the Company
               or any of its Subsidiaries or restrict in any way the business of
               the Company or any of its Subsidiaries;

         (xii) fail to maintain in full force and effect all  self-insurance and
               insurance, as the case may be, currently in effect;

        (xiii) take (or  fail to  take) any action that  (without  regard to any
               action  taken,  or agreed  to be  taken,  by Parent or any of its
               Affiliates)  would  prevent  (i) Parent from  accounting  for the
               business  combination  to be effected by the Merger as a "pooling
               of   interests"   or  (ii)  the  Merger  from   qualifying  as  a
               reorganization  within the meaning of Section 368(a) of the Code;
               or

         (xiv) authorize,  recommend, propose or announce an intention to do any
               of the foregoing, or agree or enter into or amend any contract or
               arrangement to do any of the foregoing.

     (d)  REGISTRATION STATEMENT; PROXY STATEMENT.

           (i) As promptly as practical  after the execution of this  Agreement,
               the  Company  and Parent  shall  prepare  and file with the SEC a
               joint proxy  statement/prospectus  to be sent to the shareholders
               of the  Company  and  Parent in  connection  with the  meeting of
               Parent's  shareholders  (the "Parent  Special  Meeting")  and the
               Company's   shareholders   (the  "Company  Special  Meeting")  to
               consider  the Merger  and the other  matters  to be  approved  as
               contemplated  herein (the "Joint  Proxy  Statement"),  and Parent
               shall prepare and file with the SEC a  registration  statement on
               Form S-4  pursuant  to which the Parent  Shares to be issued as a
               result  of the  Merger  will be  registered  with  the  SEC  (the
               "Registration  Statement"),  in which the Joint  Proxy  Statement
               will be included as a  prospectus.  Parent and the Company  shall
               use all reasonable efforts to cause the Registration Statement to
               become  effective  as soon after such  filing as  practical.  The

                                       47
<PAGE>
               Joint Proxy  Statement  shall include the  recommendation  of the
               Board of Directors of the Company in favor of this  Agreement and
               the Merger and the  recommendation  of the Board of  Directors of
               Parent in favor of the issuance of Parent Shares  pursuant to the
               Merger and the other matter required by this Agreement,  provided
               that the Board of  Directors  of the  Company may  withdraw  such
               recommendation  if  such  Board  of  Directors  has  received  an
               Acquisition  Proposal  and as a result shall have  determined  in
               good faith upon the written  advice of its outside legal counsel,
               that the withdrawal of such  recommendation  is necessary for the
               Board of  Directors  to comply with its  fiduciary  duties  under
               applicable law. Parent and Company shall make all other necessary
               filings with respect to the Merger under the  Securities  Act and
               the Exchange Act and the rules and regulations thereunder.

          (ii) The Company  shall take such action as may be necessary to insure
               that  (A) the  information  to be  supplied  by the  Company  for
               inclusion in the Registration Statement shall not at the time the
               Registration  Statement is declared  effective by the SEC contain
               any  untrue  statement  of a  material  fact or omit to state any
               material  fact,   required  to  be  stated  in  the  Registration
               Statement  or necessary  in order to make the  statements  in the
               Registration Statement, in light of the circumstances under which
               they were made, not misleading,  and (B) the information supplied
               by the Company for inclusion in the Joint Proxy  Statement  shall
               not, on the date the Joint  Proxy  Statement  is first  mailed to
               shareholders of the Company or Parent, at the time of the Company
               Special  Meeting  and  the  Parent  Special  Meeting,  and at the
               Effective Time,  contain any statement which, at such time and in
               light of the circumstances under which it shall be made, is false
               or misleading with respect to any material fact, or omit to state
               any material fact necessary in order to make the statements  made
               in the Joint Proxy Statement not false or misleading,  or omit to
               state any material fact necessary to correct any statement in any
               earlier communication with respect to the solicitation of proxies
               for the Company  Special  Meeting or Parent Special Meeting which
               has  become  false or  misleading.  If at any  time  prior to the
               Effective  Time  any  event  relating  to  Parent  or  any of its
               Affiliates,  officers,  or directors  should be discovered by the
               Company  which  should  be  set  forth  in as  amendment  to  the
               Registration  Statement  or  a  supplement  to  the  Joint  Proxy
               Statement, the Company shall promptly so inform Parent.

         (iii) Parent  shall take such action as may be necessary to insure that
               (A) the  information  supplied  by Parent  for  inclusion  in the
               Registration  Statement  shall  not at the time the  Registration
               Statement  is  declared  effective  by the SEC contain any untrue
               statement of a material fact or omit to state any material  fact,
               required to be stated in the Registration  Statement or necessary
               in order to make the statements in the Registration Statement, in
               light of the  circumstances  under  which  they  were  made,  not
               misleading,  and (B)  the  information  supplied  by  Parent  for
               inclusion in the Joint Proxy  Statement shall not on the date the

                                       48
<PAGE>
               Joint Proxy  Statement is first mailed to  shareholders of Parent
               or the Company, at the time of the Parent Special Meeting and the
               Company Special Meeting,  and at the Effective Time,  contain any
               statement  which, at such time and in light of the  circumstances
               under which it shall be made, is false or misleading with respect
               to any  material  fact,  or  omit  to  state  any  material  fact
               necessary in order to make the statements made in the Joint Proxy
               Statement not false or misleading,  or omit to state any material
               fact   necessary   to  correct  any   statement  in  any  earlier
               communication with respect to the solicitation of proxies for the
               Parent Special  Meeting or the Company  Special Meeting which has
               become false or misleading. If at any time prior to the Effective
               Time any  event  relating  to  Parent  or any of its  Affiliates,
               officers,  or  directors  should be  discovered  by Parent  which
               should be set forth in an amendment to the Registration Statement
               or a  supplement  to the  Joint  Proxy  Statement,  Parent  shall
               promptly so inform the Company.

     (e)  SHAREHOLDERS MEETING. Parent and the Company each shall call a meeting
          of its respective  shareholders  to be held as promptly as practicable
          for the  purpose  of  voting,  in the case of the  Company,  upon this
          Agreement and the Merger and, in the case of Parent, upon the issuance
          of shares of Parent Shares pursuant to the Merger and the other matter
          required  by this  Agreement.  Subject  to Section  5(d) and (h),  the
          Company and Parent will, through their respective Boards of Directors,
          recommend to their  respective  shareholders  approval of such matters
          and will  coordinate  and cooperate with respect to the timing of such
          meetings and shall use their best efforts to hold such meetings on the
          same day and as soon as practicable after the date hereof.  Subject to
          Section 5(d),  each Party shall use all reasonable  efforts to solicit
          from its shareholders proxies in favor of such matters.

     (f)  ADDITIONAL  SHAREHOLDER  MEETING  MATTERS.  Each of the Parent and the
          Company  shall use all  reasonable  efforts  to obtain  the  Requisite
          Stockholder  Approval of its  stockholders.  Once the Special Meetings
          have been  called and  noticed,  neither  the Parent nor the  Company,
          respectively, shall postpone or adjourn (other than for the absence of
          a quorum and then only to a future date  mutually  agreed by the other
          Party) the applicable Special Meeting without the consent of the other
          Party unless this Agreement has been terminated pursuant to Section 7.

     (g)  ACCESS TO INFORMATION. Upon reasonable notice, each of the Company and
          the Parent shall (and shall cause each of its  Subsidiaries to) afford
          to  the   officers,   employees,   accountants,   counsel   and  other
          representatives   and   agents  of  the  other   Party   (collectively
          "Representatives"),  reasonable access, during the period prior to the
          Effective Time, to all its properties,  books, contracts,  commitments
          and  records  and,  during  such  period,  each of the Company and the
          Parent  shall (and shall  cause each of its  Subsidiaries  to) furnish
          promptly  to  the  other  all  information  concerning  its  business,
          properties, books, contracts, commitments, record and personnel as the
          other Party may reasonably request. Each of the Company and the Parent

                                       49
<PAGE>
          shall (and shall cause each of its  Subsidiaries to) make available to
          the other Party the  appropriate  individuals  for  discussion of such
          entity's business,  properties and personnel as the other Party or its
          Representatives may reasonably  request. No investigation  pursuant to
          this Section 5(g) shall affect any  representations  or  warranties of
          the parties herein or the conditions to the obligations of the parties
          hereto.

     (h)  OTHER OFFERS.

           (i) The Company shall not,  whether  directly or  indirectly  through
               advisors, agents, or other intermediaries,  nor shall the Company
               authorize  or  permit  any of its  officers,  directors,  agents,
               representatives,   or  advisors  to  (A)  solicit,  initiate,  or
               encourage any inquiries or proposals  that  constitute a proposal
               or  offer   for  a   merger,   consolidation,   recapitalization,
               liquidation,   dissolution,   business   combination,   sale   of
               substantial  assets,  sale of shares of capital stock  (including
               without  limitation by way of a tender offer or exchange  offer),
               or similar  transaction  involving  the  Company,  other than the
               transactions   contemplated  by  this  Agreement,  or  any  other
               transaction  the   consummation  of  which  could  reasonably  be
               expected to impede,  interfere with, prevent, or materially delay
               the Merger or which could  reasonably  be expected to  materially
               dilute the  benefits to Parent of the  transactions  contemplated
               hereby (each such  transaction,  inquiries,  or  proposals  being
               referred to in this Agreement as an "Acquisition Proposal"),  (B)
               engage in negotiations or discussions concerning,  or provide any
               non-public  information to any person or entity  relating to, any
               Acquisition  Proposal, or (C) agree to, approve, or recommend any
               Acquisition Proposal;  provided,  however, that nothing contained
               in this  Agreement  shall  prevent  the  Company  or its Board of
               Directors from furnishing non-public  information to, or entering
               into discussions or negotiations  with, any person or entity,  or
               taking any other action deemed  necessary,  in connection with an
               unsolicited bona fide written Acquisition Proposal by such person
               or entity  or  recommending  an  unsolicited  bona  fide  written
               Acquisition  Proposal  to the  shareholders,  if and  only to the
               extent that the Board of Directors  determines in good faith upon
               the written  advice of outside  legal counsel that such action is
               necessary  for  it  to  comply  with  its  fiduciary   duties  to
               shareholders under applicable law (a "Fiduciary Finding");

          (ii) The Company  shall notify  Parent  promptly (and no later than 24
               hours)  after  receipt by the Company (or its  advisors),  of any
               Acquisition Proposal or any request for non-public information in
               connection  with an  Acquisition  Proposal  or for  access to the
               properties,  books,  or records  of the  Company by any person or
               entity that informs the Company that it is considering making, or
               has made, an Acquisition Proposal. Such notice to Parent shall be
               made  orally  and in writing  and shall  indicate  in  reasonable
               detail the  identity of the offeror and the terms and  conditions
               of such proposal, inquiry, or contact, including, specifically, a
               copy of any written Acquisition Proposal;

                                       50
<PAGE>
         (iii) The Board of Directors  of the Company  shall not take any of the
               actions  referred  to in clause  (C) first  sentence  of  Section
               5(h)(i) until after giving at least five (5) days' written notice
               to Parent  with  respect  to its  intent to take such  action and
               providing  Parent  all  of the  information  called  for in  this
               Section 5(h).  During the five-day notice period the Parent shall
               have the  opportunity  to amend its offer to match or exceed  the
               Acquisition Proposal. If in the opinion of the Company's Board of
               Directors  the   consideration   offered  by  Parent   represents
               substantially  equivalent or greater  value than the  Acquisition
               Proposal,  then this  Agreement  shall be amended to reflect such
               revised  consideration  offered by Parent and in such event, this
               Agreement shall continue in force, as so amended;

          (iv) The  Company  shall  immediately  cease and  cause its  advisors,
               agents,  and other  intermediaries  to cease any and all existing
               activities,   discussions,   or  negotiations  with  any  Parties
               conducted heretofore with respect to any Acquisition Proposal;

          (v)  If a Payment  Event  occurs,  the  Company  shall pay to  Parent,
               within  one  business  day  following   such  event,   a  fee  of
               $10,000,000 by wire transfer of immediately available funds. Such
               fee obligation shall be in addition to any payment  obligation of
               the termination  pursuant to Section 7(c).  "Payment Event" means
               this  Agreement  has  been  terminated  pursuant  to  any  of the
               following events:

               (A) the  termination  of this  Agreement  by Parent  pursuant  to
               Section  7(a)(iv) or the Company  pursuant to Section 7(a)(v) and
               the  Company  shall have  signed a  definitive  agreement  for an
               Alternative   Transaction   within  twelve  (12)  months  of  the
               termination of this Agreement;

               (B) the  termination  of this  Agreement  by Parent  pursuant  to
               Section  7(a)(viii) after a willful breach by the Company of this
               Agreement; or

               (C) the  termination  of this  Agreement by Parent or the Company
               pursuant  to  Section  7(a)(vi)  as a result  of the  failure  to
               receive the Requisite  Shareholder Approval of this Agreement and
               the  Merger by the  shareholders  of the  Company  at a duly held
               meeting of the Company's  Stockholders or any adjournment thereof
               if,  (I) at the  time of such  failure,  there  shall  have  been
               announced an  Alternative  Transaction  (as defined  below) which
               shall not have been absolutely and unconditionally  withdrawn and
               abandoned  and (II) the Company  shall have  signed a  definitive
               agreement  for such  Alternative  Transaction  within twelve (12)
               months of such failure.

                                       51
<PAGE>
          (vi) As used  in this  Agreement,  "Alternative  Transaction"  means a
               merger,     consolidation,     recapitalization,     liquidation,
               dissolution,  business  combination,  sale of substantial assets,
               sale of shares of capital stock (including  without limitation by
               way of a tender offer or exchange offer), or similar  transaction
               involving  the  Company  in which  (A) any  person  (or  group of
               persons)  other than Parent or its  Affiliates (a "Third  Party")
               acquires  more  than 30% of the  outstanding  Company  Shares  or
               equity  interests of the entity surviving such  transaction,  (B)
               any other transaction  pursuant to which any Third Party acquires
               control of assets of the Company having a fair market value equal
               to more than 30% of the fair  market  value of all the  assets of
               the Company, and its Subsidiaries,  taken as a whole, immediately
               prior to such  transaction,  or (C) any public  announcement of a
               proposal,  plan,  or intention to do any of the  foregoing or any
               agreement to engage in any of the foregoing.

         (vii) this  Section  5(h)  shall  survive  any   termination   of  this
               Agreement, however caused.

     (i)  POOLING; REORGANIZATION

           (i) The Company shall take or cause to be taken all  reasonable  acts
               (without  breaching any obligation to any other Person)  required
               in order to permit the  Company to be eligible to have the Merger
               be accounted  for as a pooling of  interests,  including  but not
               limited to, issuing approximately 300,000 Company Shares.

          (ii) The Company  shall not knowingly  take,  or knowingly  permit any
               controlled  Affiliate  of the  Company to take,  any action  that
               could  prevent  the Merger from being  treated (A) for  financial
               accounting  purposes as a "pooling of  interests"  under GAAP; it
               being  understood  and agreed that if the  Company's  independent
               accountants  advise the  Company  in writing  that such an action
               would not prevent  the Merger from being so treated,  such action
               will be  conclusively  deemed not to  constitute a breach of this
               Section 5(i) or (B) as a  "reorganization"  within the meaning of
               Section 368 of the Code.

         (iii) The Company  shall use its  reasonable  best efforts to obtain an
               executed  affiliate pooling  agreement  substantially in the form
               attached hereto as Exhibit E from each of the Persons  identified
               in Section 5(i) of the Company Disclosure  Schedule  concurrently
               with the  execution of this  Agreement  and  thereafter  from any
               other  person  who may be  deemed  an  affiliate  of the  Company
               regarding  compliance  with Rule 145 under the Securities Act and
               the  requirements  for  accounting  treatment  of the Merger as a
               "pooling of interests" (each such agreement, a "Company Affiliate
               Pooling Agreement")

                                       52
<PAGE>
          (iv) The Parent  shall take or cause to be taken all  reasonable  acts
               (without  breaching any obligation to any other Person)  required
               in order to permit the Parent to be  eligible  to have the Merger
               be accounted  for as a pooling of  interests,  including  but not
               limited  to,  issuing   approximately   2,000,000  Parent  Shares
               currently held in treasury.

          (v)  Parent  shall  not  knowingly   take  or  knowingly   permit  any
               controlled  Affiliate  of Parent to take,  any action  that could
               prevent  the  Merger  from  being   treated  (A)  for   financial
               accounting  purposes as a "pooling of  interests"  under GAAP; it
               being   understood  and  agreed  that  if  Parent's   independent
               accountants  advise  Parent in writing  that such an action would
               not prevent the Merger from being so treated, such action will be
               conclusively  deemed not to  constitute  a breach of this Section
               5(i); or (B) as a "reorganization"  within the meaning of Section
               368 of the Code.

          (vi) Parent  shall use its  reasonable  efforts to obtain an  executed
               affiliate pooling agreement in substantially the form of attached
               Exhibit E from each of the Persons  identified in Section 5(i) of
               the Parent  Disclosure  Schedule  regarding  compliance  with the
               requirements for accounting treatment of the Merger as a "pooling
               of interests"  (each such agreement a "Parent  Affiliate  Pooling
               Agreement").

     (j)  NOTIFICATION OF CERTAIN MATTERS.

           (i) The Company shall give prompt notice to Parent,  and Parent shall
               give  prompt  notice  to  the  Company,  of  the  occurrence,  or
               non-occurrence,  of any event the occurrence,  or non-occurrence,
               of which results in any  representation or warranty  contained in
               this Agreement to be untrue or inaccurate in any material respect
               (or, in the case of any  representation or warranty  qualified by
               its terms by  materiality,  Parent  Materially  Adverse Effect or
               Company Materially  Adverse Effect,  then untrue or inaccurate in
               any  respect)  and any failure of the  Company,  Parent or Merger
               Sub,  as the  case  may be,  to  comply  with or  satisfy  in any
               material  respect any  covenant,  condition  or  agreement  to be
               complied  with or satisfied by it hereunder;  provided,  however,
               that the  delivery of any notice  pursuant to this  Section  5(j)
               shall  not  limit or  otherwise  affect  the  remedies  available
               hereunder to the Party receiving such notice.

          (ii) Each of the  Company and Parent  shall give prompt  notice to the
               other of (A) any  notice or other  communication  from any Person
               alleging  that the  approval of such Person is or may be required
               in connection with the Merger and the  transactions  contemplated
               hereby; (B) any notice or other  communication from any Authority
               in connection with the Merger and the  transactions  contemplated
               hereby; (C) any Litigation, relating to or involving or otherwise

                                       53
<PAGE>
               affecting the Company,  Parent, or their respective  Subsidiaries
               that  relates  to the Merger  and the  transactions  contemplated
               hereby;  or (D) the  occurrence of a default or event that,  with
               notice or lapse of time or both,  will become a default under any
               Company Material Agreement or Parent Material Agreement;  and (E)
               any change  that could  reasonably  be expected to have a Company
               Materially  Adverse Effect or Parent Materially Adverse Effect or
               is likely to delay or impede the ability of either  Parent or the
               Company  to  consummate  the  transactions  contemplated  by this
               Agreement or to fulfill their  respective  obligations  set forth
               herein.

         (iii) Each of the Company  and Parent  shall give (or shall cause their
               respective  Subsidiaries  to give) any notices to third  Persons,
               and use,  and cause their  respective  Subsidiaries  to use,  its
               reasonable best efforts to obtain any consents from third Persons
               (A) necessary, proper or advisable to consummate the transactions
               contemplated by this Agreement;  (B) otherwise required under any
               contracts in connection with the consummation of the transactions
               contemplated  hereby;  or  (C)  required  to  prevent  a  Company
               Materially  Adverse  Effect or Parent  Materially  Adverse Effect
               from  occurring.  If any  Party  shall  fail to  obtain  any such
               consent from a third Person,  such Party shall use its reasonable
               best efforts, and will take any such actions reasonably requested
               by the  other  Parties,  to limit  the  adverse  effect  upon the
               Company  and Parent,  their  respective  Subsidiaries,  and their
               respective businesses resulting,  or which would result after the
               Effective Time, from the failure to obtain such consent.

     (k)  LISTING ON THE NASDAQ NATIONAL MARKET. Parent shall use its reasonable
          best efforts to cause the Parent Shares to be issued in the Merger and
          pursuant to Parent's  options to be issued pursuant to Section 5(q) to
          be approved  for  listing on the Nasdaq  National  Market,  subject to
          official notice of issuance, prior to the Effective Time.

     (l)  PUBLIC  ANNOUNCEMENTS.  Parent and the Company  shall consult with and
          obtain  the  approval  of the other  Party  before  issuing  any press
          release or other  public  announcement  with  respect to the Merger or
          this  Agreement  and shall not issue any such press  release  prior to
          such  consultation  and approval,  except as may be required by Law or
          any listing  agreement  related to the trading of the shares of either
          Party  on any  national  securities  exchange  or  national  automated
          quotation  system,  in which  case the Party  proposing  to issue such
          press  release  or  make  such  public   announcement  shall  use  its
          reasonable  best efforts to consult in good faith with the other Party
          before  issuing  any such  press  release  or making  any such  public
          announcement.

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<PAGE>
     (m)  TAKEOVER LAWS. If any form of anti-takeover Law,  regulation,  Charter
          or bylaw provision,  or contract is or shall become  applicable to the
          Merger or the transactions  contemplated  hereby,  the Company and the
          Board of Directors of the Company shall grant such  approvals and take
          such  actions  as  are  necessary  under  such  Law,  provisions,  and
          contracts so that the transactions contemplated hereby and thereby may
          be consummated  as promptly as  practicable on the terms  contemplated
          hereby and  otherwise act to eliminate or minimize the effects of such
          Law, provision, or contract on the transactions contemplated hereby.

     (n)  ACCOUNTANT'S LETTERS.

           (i) The Company shall use its reasonable  best efforts to cause to be
               delivered  to  Parent  a  "comfort"   letter  of  the   Company's
               accountants,  dated a date  within two  business  days before the
               date on which the  Registration  Statement shall become effective
               and  addressed to Parent and the Company,  in form and  substance
               reasonably  satisfactory and customary in scope and substance for
               letters delivered by independent public accountants in connection
               with registration statements similar to the Form S-4.

          (ii) Parent  shall  use its  reasonable  best  efforts  to cause to be
               delivered   to  the  Company  a  "comfort"   letter  of  Parent's
               accountants dated a date within two business days before the date
               on which the  Registration  Statement shall become  effective and
               addressed  to  Parent  and the  Company,  in form  and  substance
               reasonably  satisfactory and customary in scope and substance for
               letters delivered by independent public accountants in connection
               with registration statements similar to the Form S-4.

     (o)  ADDITIONAL PARENT DIRECTORS. Immediately following the Effective Time,
          Parent shall expand its Board of  Directors  and add as directors  the
          current CEO of the Company and one other person (who shall  qualify as
          an  "independent  director")  designated  by  the  current  CEO of the
          Company. The current CEO of the Company shall be designated a Class II
          director and the other  nominee shall be designated a Class I director
          on Parent's  Board of  Directors.  The Parent  agrees to nominate  the
          Company's  current CEO as part of its slate of directors for which the
          Parent seeks proxies in connection with the election of directors next
          following the Effective Time.

     (p)  HART-SCOTT-RODINO  ACT. Each of the Parties will file any notification
          and report forms and related  material that it may be required to file
          with the Federal Trade  Commission  and the Antitrust  Division of the
          United States Department of Justice under the  Hart-Scott-Rodino  Act,
          will use its best  efforts  to  obtain  an  early  termination  of the
          applicable  waiting  period,  will make any further  filings  pursuant
          thereto that may be  necessary,  proper,  or  advisable,  and will not
          terminate  or  withdraw  such  application  without the consent of the
          other  Parties.  The Parent shall pay the filing fee  associated  with
          such filings.

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<PAGE>
     (q)  COMPANY  STOCK OPTIONS AND COMPANY  STOCK PLANS;  OUTSTANDING  COMPANY
          STOCK OPTIONS.

           (i) At the Effective  Time,  each  Outstanding  Company Stock Option,
               whether   vested  or   unvested,   will  be   assumed  by  Parent
               automatically  and without further action in accordance with this
               Agreement.  Each such Outstanding Company Stock Option so assumed
               by Parent under this  Agreement  shall  continue to have,  and be
               subject  to,  the same  terms  and  conditions  set  forth in the
               Company  Stock Option Plans,  option  agreements  thereunder  and
               other relevant  documentation  immediately prior to the Effective
               Time,  except that such Outstanding  Company Stock Option will be
               exercisable  solely for that number of whole Parent  Shares equal
               to  the  product  of the  number  of  Company  Shares  that  were
               purchasable   under  such   Outstanding   Company   Stock  Option
               immediately  prior  to the  Effective  Time  multiplied  by  1.7,
               rounded down to the nearest  whole number of Parent  Shares,  and
               the per-share  exercise price for the Parent Shares issuable upon
               exercise of such assumed Outstanding Company Stock Option will be
               equal to the quotient  determined by dividing the exercise  price
               per share of  Company  Shares at which such  Outstanding  Company
               Stock Option was exercisable  immediately  prior to the Effective
               Time by 1.7, and rounding the resulting  exercise price up to the
               nearest whole cent;  provided,  however,  that in the case of any
               option to which  section 421 of the Code applies by reason of its
               qualification  under  section 422 of the Code  ("incentive  stock
               options"),  the option  price,  the number of shares  purchasable
               pursuant to such option and the terms and  conditions of exercise
               of such option shall be determined in accordance  with the method
               set forth above  unless use of such method will not  preserve the
               status of such options as incentive stock options,  in which case
               the manner of  determination  shall be  adjusted in a manner that
               both complies with Section  424(a) of the Code and results in the
               smallest modification in the economic values that otherwise would
               be achieved by the holder pursuant to the method set forth above;
               and provided further,  that  notwithstanding any other provisions
               of  this  Section  5(q),  if  use  of  the  above  methods  would
               disqualify  the Merger as a "pooling of interests"  for financial
               accounting  purposes,  then such  methods will be adjusted to the
               extent necessary to preserve such accounting treatment.

          (ii) Parent shall  reserve for issuance a sufficient  number of Parent
               Shares for delivery  upon exercise of  Outstanding  Company Stock
               Options assumed by Parent under this Agreement. Parent shall file
               as soon as  practicable  after the Effective  Date a registration
               statement  on Form S-8  under the  Securities  Act  covering  the
               Parent  Shares  issuable  upon the  exercise  of the  Outstanding
               Company Stock Options assumed by Parent pursuant to this Section,
               and shall use its reasonable  efforts to cause such  registration

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<PAGE>
               statement to become  effective as soon  thereafter as practicable
               and to maintain such registration in effect until the exercise or
               expiration of such assumed Outstanding Company Stock Options.

         (iii) The vesting of each  Outstanding  Company  Stock Option shall not
               accelerate   as  a  result  of,  or  in  connection   with,   the
               transactions  contemplated hereby,  except to the extent required
               by the  existing  terms of the Company  Stock Option Plans or the
               option agreement  pursuant to which it was granted.  In addition,
               the Company  shall ensure that no  discretion is exercised by the
               Board of Directors or any committee  thereof or any other body or
               Person  so as to cause the  vesting  of any  Outstanding  Company
               Stock  Option or any other  warrant or right to  acquire  Company
               Shares to accelerate.

     (r)  INSURANCE AND INDEMNIFICATION.

           (i) The  Parent  will not  take any  action  to alter or  impair  any
               exculpatory  or  indemnification  provisions  now existing in the
               Charter  or  bylaws  of  the  Company  for  the  benefit  of  any
               individual  who is serving or has served as a director or officer
               of the Company or is or was otherwise entitled to indemnification
               thereunder at any time prior to the Effective Time;

          (ii) From and after the Effective Time, Parent shall indemnify, defend
               and hold  harmless any person who is on the date  hereof,  or has
               been at any time prior to the date hereof,  or who becomes  prior
               to the Effective  Time, an officer,  director,  employee or agent
               (the   "Indemnified   Party")  of  the  Company  or  any  of  its
               Subsidiaries against all losses,  claims,  damages,  liabilities,
               costs and  expenses  (including  attorneys'  fees and  expenses),
               judgments,  fines,  and amounts paid in  settlement in connection
               with any actual or threatened action, suit, claim,  proceeding or
               investigation (each, a "Claim") to the extent that any such Claim
               is based on or arises  out of, (A) the fact that any person is or
               was a director,  officer, employee or agent of the Company or any
               of its Subsidiaries at any time prior to the Effective Time or is
               or was  serving  at the  request  of  the  Company  or any of its
               Subsidiaries as a director, officer, employee or agent of another
               corporation,   partnership,   joint   venture,   trust  or  other
               enterprise at any time prior to the  Effective  Time, or (B) this
               Agreement  or any  of the  transactions  contemplated  hereby  or
               thereby in each case to the extent  that any such Claim  pertains
               to any matter or fact arising, existing, or occurring prior to or
               at the  Effective  Time,  regardless  of  whether  such  Claim is
               asserted or claimed prior to, at or after the Effective Time (the
               matters  described  in  clauses  (A)  and  (B),  the  "Pre-Merger
               Matters"),  to the fullest extent indemnified under the Company's
               Charter, bylaws or any indemnification agreements in effect as of
               the date hereof, or under the Tennessee Business Corporation Act,
               including in each case provisions  relating to the advancement of
               expenses incurred in the defense of any action or suit.

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<PAGE>
         (iii) Parent  agrees  that  all  right  to   indemnification   and  all
               limitations or  exculpation  of liabilities  existing in favor of
               any  Indemnified  Party as  provided  in the  Company's  Charter,
               bylaws or the Tennessee Business  Corporation Act as in effect as
               of the  Effective  Time shall  continue  in full force and effect
               with  respect  to  Pre-Merger  Matters,   without  any  amendment
               thereto, for a period of six years from the Effective Time to the
               extent such rights are  consistent  with the  Tennessee  Business
               Corporation Act, provided,  that in the event any Claim or Claims
               with respect to any such Pre-Merger  Matters are asserted or made
               within such six-year  period,  all rights to  indemnification  in
               respect  of  any  such  Claim  or  Claims  shall  continue  until
               disposition of any such Claim or Claims; provided,  however, that
               any determination  required to be made with respect to whether an
               Indemnified Party's conduct complies with the standards set forth
               under the  Tennessee  Business  Corporation  Act,  the  Company's
               Charter  or  bylaws,  as the  case  may  be,  shall  be  made  by
               independent  legal counsel selected by the Indemnified  Party and
               reasonably  acceptable  to the Parent,  retained at the  Parent's
               expense,  and provided further that nothing in this Section shall
               impair  any  rights  or  obligations  of any  present  or  former
               directors or officers of the Company.

          (iv) Parent  shall  maintain in effect the  Company's  directors'  and
               officers'  liability insurance policy at the Effective Time ("D&O
               Insurance")  with respect to  Pre-Merger  Matters for a period of
               not less than six years after the Effective Time, provided,  that
               the Parent may  substitute  therefor  policies  of  substantially
               similar   coverage   and   amounts   containing   terms  no  less
               advantageous to such former directors or officers.

          (v)  The  provisions  of this  Section 5(o) are intended to be for the
               benefit of, and shall be enforceable  by, each Person entitled to
               indemnification  hereunder and the heirs and  representatives  of
               such Person.

     (s)  ADDITIONAL  AGREEMENTS.  Each of the Parent and the Company  shall use
          its best efforts to cause (i) the Voting Agreements to be executed and
          delivered   contemporaneously  herewith;  (ii)  each  of  the  Persons
          identified  in Section  5(i) of the  Company  Disclosure  Schedule  to
          execute and deliver a Company  Affiliate  Pooling Agreement as soon as
          reasonably  practicable  after  the  date  hereof;  (iii)  each of the
          Persons  identified in Section 5(i) of the Parent Disclosure  Schedule
          to execute and deliver a Parent Affiliate Pooling Agreement as soon as
          reasonably  practicable  after the date  hereof;  and (iv) each of the
          individuals listed in Section 5(s) of the Company Disclosure  Schedule
          to execute  and deliver an  Employment  Agreement  effective  from and
          after the Effective Time (the "Employment Agreements"),  substantially
          in the form  attached  hereto  as  Exhibit  F-1,  F-2,  F-3,  and F-4,

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<PAGE>
          respectively. In addition, at the Effective Time and contemporaneously
          with entering into the Employment  Agreements,  the Parent shall enter
          into stock option  agreements  with the  Executives  entering into the
          Employment  Agreements in a form similar to those  customarily used by
          Parent for its  executive  officers  and  providing  for a grant of an
          option to purchase the number of Parent Shares set forth  opposite the
          name of each such  executive in Section 5(s) of the Parent  Disclosure
          Schedule.

6.   CONDITIONS TO OBLIGATION TO CLOSE.

     (a)  CONDITIONS  TO  OBLIGATION  OF THE  PARENT  AND THE  MERGER  SUB.  The
          obligation of each of the Parent and the Merger Sub to consummate  the
          transactions  to be performed by it in connection  with the Closing is
          subject to satisfaction of the following conditions:

           (i) the  Company  shall  have  received  the  Requisite   Stockholder
               Approval of this Agreement and the Merger at the Company  Special
               Meeting,  and  the  Parent  shall  have  received  the  Requisite
               Stockholder  Approval of the  issuance  of Parent  Shares and the
               other   matters   required  to  be   submitted  to  the  Parent's
               stockholders in accordance with this Agreement;

          (ii) the Company shall have  procured all of the third party  consents
               specified  in Section  3(d) of the Company  Disclosure  Schedule,
               except where the failure to obtain such consents would not have a
               Company Materially Adverse Effect;

         (iii) the  representations  and warranties set forth in Section 3 above
               shall be true and correct in all  material  respects at and as of
               the Effective  Time, with the same force and effect as if made on
               and as of the  Effective  Time  (other than  representations  and
               warranties which address matters only as of a particular date, in
               which case such  representations and warranties shall be true and
               correct,  on and as of such  particular  date)  except  where the
               failure to be true and correct  would not  reasonably be expected
               to result in a Company Materially Adverse Effect;

          (iv) the Company  shall have  performed  and complied  with all of its
               covenants  and  agreements  hereunder  in all  material  respects
               through the Closing;

          (v)  no  temporary   restraining   order,   preliminary  or  permanent
               injunction,  or  other  Order  of  an  Authority  with  competent
               jurisdiction shall have been issued and shall be in effect at the
               Effective Time which would (A) prevent consummation of any of the
               transactions contemplated by this Agreement, (B) cause any of the
               transactions  contemplated  by  this  Agreement  to be  rescinded
               following  consummation,  (C) affect  adversely  the right of the
               Parent to own the capital stock of the Surviving  Corporation and
               to control the Surviving Corporation, or (D) affect adversely the
               right  of the  Surviving  Corporation  to own its  assets  and to
               operate its businesses;

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<PAGE>
          (vi) the Company shall have delivered to the Parent and the Merger Sub
               a certificate to the effect that each of the conditions specified
               above  in  Section  6(a)(i)  through  (v)  is  satisfied  in  all
               respects;

         (vii) the Registration  Statement shall have become effective under the
               Securities Act, no stop order suspending the effectiveness of the
               Registration  Statement  or the use of the Joint Proxy  Statement
               shall have been issued by the SEC;  and no  proceedings  for that
               purpose  shall have been  initiated  or, to the  Knowledge of the
               Parent or the  Company,  threatened  by the SEC;  and the  Parent
               Shares issuable hereunder shall have been approved for listing on
               The  Nasdaq   National  Market  subject  to  official  notice  of
               issuance;

        (viii) all  applicable  waiting  periods  (and any  extensions  thereof)
               under the  Hart-Scott-Rodino  Act shall have expired or otherwise
               been  terminated  and the Parties  shall have  received all other
               authorizations,  consents,  and approvals of Authorities referred
               to in Section 3(d) and Section 4(d) above;

          (ix) the Parent and the Merger Sub shall have received from counsel to
               the  Company  an  opinion  in  form  and   substance   reasonably
               satisfactory  to the  Parent,  addressed  to the  Parent  and the
               Merger Sub, and dated as of the Closing Date;

          (x)  all  actions  to be  taken  by the  Company  in  connection  with
               consummation  of the  transactions  contemplated  hereby  and all
               certificates, opinions, instruments, and other documents required
               to effect the transactions contemplated hereby will be reasonably
               satisfactory  in form and  substance to the Parent and the Merger
               Sub;

          (xi) each of the Employment  Agreements,  in form and substance  shall
               have been executed and delivered;

         (xii) no Company Materially Adverse Effect shall have occurred;

        (xiii) Parent  shall  have  received  a letter  from its  independent
               accountants  in form and  substance  reasonably  satisfactory  to
               Parent,  dated the Closing  Date,  concurring  with  management's
               conclusions that the transactions contemplated by this Agreement,
               including  the Merger,  will qualify as a "pooling of  interests"
               business  combination in accordance with GAAP and the criteria of
               Accounting Principles Board Opinion No. 16 and the regulations of

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<PAGE>
               the SEC,  such letter  shall not have been revoked or modified in
               any  material  respect,  and Parent  shall not have  received any
               indication from the SEC that the Merger may not so qualify;

         (xiv) each of the  Persons  identified  in Section  5(i) of the Company
               Disclosure  Schedule  shall have executed and delivered a Company
               Affiliate  Pooling  Agreement  which  shall be in full  force and
               effect.

     The Parent and the Merger  Sub may waive any  condition  specified  in this
     Section  6(a) if they  execute  a  writing  so  stating  at or prior to the
     Closing.

     (b)  CONDITIONS TO OBLIGATION OF THE COMPANY. The obligation of the Company
          to  consummate  the  transactions  to be performed by it in connection
          with  the  Closing  is  subject  to   satisfaction  of  the  following
          conditions:

           (i) the Registration  Statement shall have become effective under the
               Securities Act, no stop order suspending the effectiveness of the
               Registration  Statement or the use of the Proxy  Statement  shall
               have been  issued by the SEC;  no  proceedings  for that  purpose
               shall have been  initiated  or, to the Knowledge of the Parent or
               the  Company,  threatened  by the  SEC;  and  the  Parent  Shares
               issuable  hereunder  shall have been  approved for listing on The
               Nasdaq National Market subject to official notice of issuance;

          (ii) the Parent shall have  procured all of the  third-party  consents
               specified  in  Section  4(d) of the Parent  Disclosure  Schedule,
               except where the failure to obtain such consents would not have a
               Parent Materially Adverse Effect;

         (iii) the  representations  and warranties set forth in Section 4 above
               shall be true and correct in all  material  respects at and as of
               the Effective  Time, with the same force and effect as if made on
               and as of the  Effective  Time  (other than  representations  and
               warranties which address matters only as of a particular date, in
               which case such  representations and warranties shall be true and
               correct,  on and as of such  particular  date)  except  where the
               failure to be true and correct  would not  reasonably be expected
               to result in a Parent Materially Adverse Effect;

          (iv) each of the Parent and the  Merger Sub shall have  performed  and
               complied with all of its covenants  and  agreements  hereunder in
               all material respects through the Closing;

           (v) no  temporary   restraining   order,   preliminary  of  permanent
               injunction,  or  other  Order  of  an  Authority  with  competent
               jurisdiction shall have been issued and shall be in effect at the
               Effective Time which would (A) prevent consummation of any of the
               transactions contemplated by this Agreement, (B) cause any of the
               transactions  contemplated  by  this  Agreement  to be  rescinded

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<PAGE>
               following  consummation,  (C) affect  adversely  the right of the
               Parent to own the capital stock of the Surviving  Corporation and
               to control the Surviving Corporation, or (D) affect adversely the
               right  of the  Surviving  Corporation  to own its  assets  and to
               operate its businesses;

          (vi) each of the Parent and the Merger Sub shall have delivered to the
               Company a certificate  to the effect that each of the  conditions
               specified  above in Section  6(b)(i)  through (v) is satisfied in
               all respects;

         (vii) all  applicable  waiting  periods  (and any  extensions  thereof)
               under the  Hart-Scott-Rodino  Act shall have expired or otherwise
               been  terminated  and the Parties  shall have  received all other
               authorizations,  consents,  and approvals of Authorities referred
               to in Section 3(d) and Section 4(d) above;

        (viii) the Company  shall  have received  from counsel to the Parent and
               the  Merger  Sub an  opinion  in form  and  substance  reasonably
               satisfactory to the Company,  addressed to the Company, and dated
               as of the Closing Date;

          (ix) all  actions  to be taken by the  Parent  and the  Merger  Sub in
               connection  with  consummation of the  transactions  contemplated
               hereby and all  certificates,  opinions,  instruments,  and other
               documents required to effect the transactions contemplated hereby
               will be  reasonably  satisfactory  in form and  substance  to the
               Company;

           (x) no Parent Materially Adverse Effect shall have occurred;

          (xi) the Company  shall have  received a letter  from its  independent
               accountants in form and substance reasonably  satisfactory to the
               Company,  dated the Closing Date,  concurring  with  management's
               conclusions that the transactions contemplated by this Agreement,
               including  the Merger,  will qualify as a "pooling of  interests"
               business  combination in accordance with GAAP and the criteria of
               Accounting Principles Board Opinion No. 16 and the Regulations of
               the SEC; and the Company shall not have  received any  indication
               from the SEC that the Merger may not so qualify;

         (xii) each of the  Persons  identified  in Section  5(i) of the Company
               Disclosure  Schedule  shall have  executed and delivered a Parent
               Affiliate  Pooling  Agreement  which  shall be in full  force and
               effect;

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<PAGE>
        (xiii) each of  the  persons  listed  on  Section  5(s) of  the  Company
               Disclosure   Schedule  shall  have  entered  into  an  Employment
               Agreement with the Company;

         (xiv) the  Fairness  Opinion  shall remain in full force and effect and
               shall not have been revoked or modified in any material respect;

          (xv) the  Company  shall  have  received  the  Requisite   Stockholder
               Approval of this Agreement and the Merger at the Company  Special
               Meeting; and

         (xvi) the Company  shall have  received the opinion of its tax counsel,
               in the form and substance reasonably satisfactory to the Company,
               and dated as of the Effective Time, to the effect that the Merger
               will constitute a transaction  described in Section 368(a) of the
               Code and neither the Company nor its shareholders shall recognize
               gain or loss for federal  income tax  purposes as a result of the
               Merger  (other  than  with  respect  to  cash  paid  in  lieu  of
               fractional shares).

     The Company may waive any  condition  specified  in this Section 6(b) if it
     executes a writing so stating at or prior to the Closing.

7.   Termination.

     (a)  TERMINATION.  This Agreement may be terminated  prior to the Effective
          Time as follows  (notwithstanding  any  approval  of the Merger by the
          stockholders of the Parent, Merger Sub, and the Company):

           (i) by  mutual  written  consent  duly  authorized  by the  Boards of
               Directors of Parent and the Company at any time;

          (ii) by Parent or Company if the Closing shall not have occurred on or
               before September 30, 2001;  provided that such right shall not be
               available  to any Party  whose  willful  failure to  fulfill  any
               material  obligation  under this Agreement has been the cause of,
               or has resulted  in, the failure of the Merger to be  consummated
               on or before such date;

         (iii) by the Parent if there  shall be any Law that makes  consummation
               of the Merger  illegal or otherwise  prohibited;  or if any Order
               enjoining  Parent or the Company from  consummating the Merger is
               entered and such Order shall become final and non-appealable;

          (iv) by Parent,  if (A) the Board of  Directors  of the Company  shall
               have withdrawn or modified its  recommendation  of this Agreement
               or the  Merger  in a manner  adverse  to  Parent  or  shall  have
               resolved to do any of the  foregoing;  (B) the Board of Directors
               of the Company shall have  recommended to the shareholders of the

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               Company  an  Alternative  Transaction;  or (C) a tender  offer or
               exchange offer for 30% or more of the outstanding  Company Shares
               is commenced  and the Board of Directors of the Company  fails to
               timely  recommend that the shareholders of the Company not tender
               their shares in such tender or exchange offer;

          (v)  by the Company if prior to the Effective Time, in good faith, the
               Board of  Directors  of the  Company  shall have made a Fiduciary
               Finding and have  withdrawn  or modified or amended,  in a manner
               adverse  to  Parent,  its  approval  or  recommendation  of  this
               Agreement and the Merger or its recommendation  that stockholders
               of the Company adopt and approve this Agreement and the Merger in
               order to permit the  Company to  execute a  definitive  agreement
               providing  for the  acquisition  of the  Company  or in  order to
               approve a tender or exchange  offer for any or all of the Company
               Shares;  provided that the Company  shall be in  compliance  with
               Section 5(h);

          (vi) by either the  Company or Parent if, at a duly held  stockholders
               meeting of the Company or any  adjournment  thereof at which this
               Agreement and the Merger is voted upon, the Requisite Stockholder
               Approval shall not have been obtained;

         (vii) by either the  Company or Parent if, at a duly held  stockholders
               meeting  of  the  Parent  or any  adjournment  thereof  at  which
               issuance of Parent  Shares as required  under  Section 2 is voted
               upon,  the  Requisite  Stockholder  Approval  shall not have been
               obtained;

        (viii) by  Parent,  if  neither  Parent  nor Merger  Sub is in  material
               breach of its obligations under this Agreement, and if (A) at any
               time  that  any  of the  representations  and  warranties  of the
               Company  herein  become  untrue or  inaccurate  such that Section
               6(a)(iii)  would not be  satisfied  (treating  such time as if it
               were the Effective Time for purposes of this Section  7(a)(viii))
               or (B) there has been a breach on the part of the  Company of any
               of its covenants or agreements  contained in this  Agreement such
               that Section 6(a)(iv) would not be satisfied  (treating such time
               as if it were the  Effective  Time for  purposes of this  Section
               7(a)(viii)),  and, in both case (A) and case (B), such breach (if
               curable)  has not been cured  within 30 days after  notice to the
               Company;

          (ix) by  the  Company,  if  it  is  not  in  material  breach  of  its
               obligations under this Agreement, and if (A) at any time that any
               of the  representations  and  warranties  of Parent or Merger Sub
               herein become untrue or  inaccurate  such that Section  6(b)(iii)
               would  not be  satisfied  (treating  such  time as if it were the
               Effective  Time for  purposes of this  Section  7(a)(ix))  or (B)
               there has been a breach  on the part of  Parent or Merger  Sub of

                                       64
<PAGE>
               any of their respective covenants or agreements contained in this
               Agreement  such that  Section  6(b)(iv)  would  not be  satisfied
               (treating such time as if it were the Effective Time for purposes
               of this Section  7(a)(ix)),  and such breach (if curable) has not
               been cured within 30 days after notice to Parent; or

          (x)  by the  Company,  if the Board of  Directors of Parent shall have
               withdrawn or modified its recommendation in favor of the issuance
               of Parent  Shares  pursuant to the Merger in a manner  adverse to
               the Company or shall have resolved to do any of the foregoing.

     The Party desiring to terminate this Agreement pursuant to Section 7(a)(ii)
     through  (x) shall give  written  notice of such  termination  to the other
     Party in accordance with Section 8(h).

     (b)  EFFECT OF  TERMINATION.  In the event of termination of this Agreement
          as provided in Section 7(a), this Agreement shall  immediately  become
          void and there  shall be no  liability  or  obligation  on the part of
          Parent,   Merger  Sub,  the  Company  or  their  respective  officers,
          directors, shareholders, or Affiliates, except as set forth in Section
          5(h) and Section  7(c) and such  Section 5(h) and Section 7(c) of this
          Agreement  shall  remain in full  force and  effect  and  survive  any
          termination of this Agreement.

     (c)  FEES AND EXPENSES.

           (i) Except as set forth in this Section  7(c),  all fees and expenses
               incurred in connection  with this Agreement and the  transactions
               contemplated  hereby  shall be paid by the Party  incurring  such
               expenses,  regardless  of  whether  the  Merger  is  consummated;
               provided,  however,  that  Parent  and the  Company  shall  share
               equally  all fees  and  expenses,  other  than  attorneys'  fees,
               incurred  in  relation  to the  printing  and filing of the Joint
               Proxy Statement (including any related preliminary materials) and
               the Registration  Statement  (including  financial statements and
               exhibits).

          (ii) Company  shall pay Parent a  termination  fee equal to $1,000,000
               plus the aggregate amount of Parent's  documented expenses not to
               exceed  $1,000,000,  upon the earliest to occur of the  following
               events:

               (A) the  termination  of this  Agreement  by Parent  pursuant  to
               Section 7(a)(iv) or the Company pursuant to Section 7(a)(v);

               (B) the  termination  of this  Agreement  by Parent  pursuant  to
               Section 7(a)(viii) after a willful breach by the Company; or

               (C) the  termination  of this  Agreement by Parent or the Company
               pursuant  to  Section  7(a)(vi)  as a result  of the  failure  to
               receive the requisite vote for approval of this Agreement and the
               Merger  by the  shareholders  of  the  Company  at the  Company's
               Special Meeting if, (I) at the time of such failure,  there shall

                                       65
<PAGE>
               have been  announced an Alternative  Transaction  which shall not
               have been absolutely and unconditionally  withdrawn and abandoned
               and (II) the Company shall have signed a definitive agreement for
               such  Alternative  Transaction  within twelve (12) months of such
               failure.

         (iii) Parent  shall  pay  the  Company  a  termination   fee  equal  to
               $1,000,000 plus the aggregate amount of the Company's  documented
               expenses not to exceed $1,000,000,  upon the earliest to occur of
               the following events:

               (A) the termination of this Agreement by the Company  pursuant to
               Section 7(a)(x); or

               (B) the termination of this Agreement by the Company  pursuant to
               Section  7(a)(ix)  after  a  willful  breach  by  Parent  of this
               Agreement.

          (iv) The expenses and fees, if  applicable,  payable  pursuant to this
               Section 7 shall be paid within thirty (30) days after  submission
               by Parent or the Company, as the case may be.

8.   Miscellaneous.

     (a)  SURVIVAL.  None of the  representations  and warranties of the Parties
          will survive the Effective Time.

     (b)  Reserved.

     (c)  NO  THIRD-PARTY  BENEFICIARIES.  This  Agreement  shall not confer any
          rights or  remedies  upon any Person  other than the Parties and their
          respective successors and permitted assigns;  provided,  however, that
          (i) the provisions in Section 2 above concerning payment of the Merger
          Consideration are intended for the benefit of the Company Stockholders
          and (ii) the provisions in Section 5(r) above concerning insurance and
          indemnification  are  intended  for  the  benefit  of the  individuals
          specified therein and their respective legal representatives.

     (d)  ENTIRE AGREEMENT.  This Agreement (including the documents referred to
          herein)  constitutes  the  entire  agreement  among  the  Parties  and
          supersedes any prior understandings, agreements, or representations by
          or among the Parties,  written or oral,  to the extent they related in
          any way to the subject matter hereof.

     (e)  SUCCESSION AND  ASSIGNMENT.  This Agreement  shall be binding upon and
          inure to the benefit of the Parties named herein and their  respective
          successors  and  permitted  assigns.  No Party may assign  either this
          Agreement or any of its rights,  interests,  or obligations  hereunder
          without the prior written approval of the other Parties.

                                       66
<PAGE>
     (f)  COUNTERPARTS.   This   Agreement  may  be  executed  in  one  or  more
          counterparts,  each of which  shall be deemed an  original  but all of
          which together will constitute one and the same instrument.

     (g)  HEADINGS.  The  section  headings  contained  in  this  Agreement  are
          inserted  for  convenience  only and shall  not  affect in any way the
          meaning or interpretation of this Agreement.

     (h)  NOTICES. Any notice, request,  demand, waiver,  consent,  approval, or
          other  communication which is required or permitted hereunder shall be
          in  writing  and shall be deemed  given only if  delivered  personally
          (including by nationally recognized overnight courier service) or sent
          by  telegram  or by  certified  mail,  postage  prepaid,  and  sent by
          telecopier as follows:

     If to Parent or the Merger Sub, to:    Swift Transportation Co., Inc.
                                            2200 South 75th Avenue
                                            Phoenix, Arizona 85043
                                            (623) 269-9700 Telephone
                                            (623) 907-7503 Fax
                                            Attn: William F. Riley, III

With a required copy to:                    Mark A. Scudder
                                            Scudder Law Firm, P.C.
                                            411 S. 13th Street, Suite 200
                                            Lincoln, Nebraska 68508
                                            (402) 435-3223 Telephone
                                            (402) 435-4239 Fax

If to the Company, to:                      M. S. Carriers, Inc.
                                            3171 Directors Row
                                            Memphis, Tennessee 38131
                                            (901) 332-2500 Telephone
                                            (901) 344-4607 Fax
                                            Attn: M. J. Barrow

                                       67
<PAGE>
With a required copy to:                    Robert E. Orians
                                            Martin, Tate, Morrow & Marston, P.C.
                                            22 N. Front Street, Suite 1100
                                            Memphis, Tennessee 38103
                                            (901) 522-9000 Telephone
                                            (901) 527-3746 Fax

          or to such other  address as the addressee  shall have  specified in a
          notice  duly  given to the sender as  provided  herein.  Such  notice,
          request,  demand,  waiver,  consent,  approval, or other communication
          shall be  deemed  to have  been  given  as of the  date so  personally
          delivered, telegraphed, or deposited in the mail and telecopied.

     (i)  GOVERNING  LAW. This  Agreement  shall be governed by and construed in
          accordance  with the domestic  laws of the State of Tennessee  without
          giving  effect to any  choice or  conflict  of law  provision  or rule
          (whether of the State of  Tennessee  or any other  jurisdiction)  that
          would cause the application of the laws of any jurisdiction other than
          the State of Tennessee.

     (j)  AMENDMENTS  AND WAIVERS.  The Parties may mutually amend any provision
          of this  Agreement  at any time prior to the  Effective  Time with the
          prior authorization of their respective boards of directors; provided,
          however,   that  any  amendment  effected  subsequent  to  stockholder
          approval  will  be  subject  to  the  restrictions  contained  in  the
          Tennessee  Business  Corporation Act. No amendment of any provision of
          this Agreement  shall be valid unless the same shall be in writing and
          signed by all of the  Parties.  No waiver by any Party of any default,
          misrepresentation,  or  breach  of  warranty  or  covenant  hereunder,
          whether  intentional or not, shall be deemed to extend to any prior or
          subsequent  default,  misrepresentation,  or  breach  of  warranty  or
          covenant  hereunder or affect in any way any rights  arising by virtue
          of any prior or subsequent such occurrence.

     (k)  SEVERABILITY.  Any term or provision of this Agreement that is invalid
          or unenforceable in any situation in any jurisdiction shall not affect
          the validity or  enforceability  of the remaining terms and provisions
          hereof or the  validity or  enforceability  of the  offending  term or
          provision in any other situation or in any other jurisdiction.

     (l)  EXPENSES.  Each of the Parties  shall bear its own costs and  expenses
          (including  legal fees and expenses)  incurred in connection with this
          Agreement and the transactions contemplated hereby.

     (m)  INCORPORATION  OF EXHIBITS AND SCHEDULES.  The Exhibits and Disclosure
          Schedules  identified  in this  Agreement are  incorporated  herein by
          reference and made a part hereof.

                                       68
<PAGE>
     (n)  ENFORCEMENT OF AGREEMENT.  The Parties agree that  irreparable  damage
          would occur if any provision of this  Agreement  were not performed in
          accordance  with  its  specific  terms  or  were  otherwise  breached.
          Accordingly,  the  Parties  shall  be  entitled  to an  injunction  or
          injunctions  to  prevent  breaches  of this  Agreement  and to enforce
          specifically the terms and provisions  hereof,  this being in addition
          to any other remedy to which they are entitled at law or in equity.

     IN WITNESS  WHEREOF,  the Parties  hereto have caused this  Agreement to be
executed and delivered by their duly  authorized  representative  as of the date
first above written.

                                      Swift Transportation Co., Inc.,
                                      a Nevada corporation

                                      By: /s/ Jerry Moyes
                                         ------------------------------------
                                         Jerry Moyes, Chairman, President and
                                         Chief Executive Officer

                                      Sun Merger, Inc.,
                                      a Tennessee Corporation

                                      By: /s/ Jerry Moyes
                                         ---------------------------------------
                                         Jerry Moyes, President

                                      M. S. Carriers, Inc.
                                      a Tennessee Corporation

                                      By: /s/ Michael S. Starnes
                                         ---------------------------------------
                                         Michael S. Starnes, Chariman, President
                                         and Chief Executive Officer

                                       69

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