Document:

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                                                                    Exhibit 10.5

                           MBIA INSURANCE CORPORATION,
                                   as Insurer,

                         CAPITAL ONE AUTO FINANCE, INC.,

                                       and

                        CAPITAL ONE AUTO RECEIVABLES, LLC

                                as Issuer Parties

                                       and

                            WACHOVIA SECURITIES, INC.
                      as Representative of the Underwriters

                            INDEMNIFICATION AGREEMENT

                                 $1,100,000,000
                      Capital One Auto Finance Trust 2002-B
                Automobile Receivable-Backed Notes, Series 2002-B
    Class A-1 Notes, Class A-2-A Notes, Class A-2-B Notes, Class A-3-A Notes,
           Class A-3-B Notes, Class A-4-A Notes and Class A-4-B Notes

                          Dated as of September 4, 2002

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                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                           Page
<S>                                                                        <C>
Section 1.    Definitions................................................     1
Section 2.    Representations and Warranties of the Insurer..............     3
Section 3.    Representations and Warranties of the Underwriters.........     4
Section 4.    Reserved...................................................     5
Section 5.    Indemnification............................................     5
Section 6.    Notice To Be Given.........................................     6
Section 7.    Contribution...............................................     7
Section 8.    Notices....................................................     9
Section 9.    Governing Law, Etc.........................................    10
Section 10.   Other Obligations Not Effected.............................    10
Section 11.   Limitations................................................    10
Section 12.   Counterparts...............................................    10
Section 13.   Non-petition...............................................    10
</TABLE>

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                            INDEMNIFICATION AGREEMENT

     This Agreement, dated as of September 4, 2002 is between MBIA Insurance
Corporation (the "Insurer"), as the Insurer under the Note Guaranty Insurance
Policy (the "Policy") issued in connection with the Offered Notes described
below, CAPITAL ONE AUTO FINANCE, INC. ("COAF") and CAPITAL ONE AUTO RECEIVABLES,
LLC ("COAR" and together with COAF, the "Issuer Parties") and WACHOVIA
SECURITIES, INC. as Representative of the Underwriters (the "Representative") on
behalf of the Underwriters (as defined below).

     Section 1. Definitions. As used in this Agreement, the following terms
shall have the respective meanings stated herein, unless the context clearly
requires otherwise, in both singular and plural form, as appropriate.
Capitalized terms used in this Agreement but not otherwise defined herein will
have the meanings ascribed to such terms in the Indenture (as described below).

     "Act" means the Securities and Exchange Act of 1933, as amended, together
with all related rules and regulations.

     "Agreement" means this Indemnification Agreement by and between the Insurer
and the Representative of the Underwriters.

     "Indemnified Party" means any party entitled to any indemnification
pursuant to Section 5 below, as the context requires.

     "Indemnifying Party" means any party required to provide indemnification
pursuant to Section 5 below, as the context requires.

     "Indenture" means the Indenture dated as of September 16, 2002 by and
between the Owner Trustee, and JPMorgan Chase Bank, as Indenture Trustee.

     "Insurance Agreement" means the Insurance Agreement, dated as of September
16, 2002 by and among the Insurer, the Owner Trustee, the Seller, the
Transferor, the Servicer and JPMorgan Chase Bank, as the Indenture Trustee.

     "Insurer Party" means the Insurer and its respective parents, subsidiaries
and affiliates and any shareholder, director, officer, employee, agent or any
"controlling person" (as such term is used in the Act) of any of the foregoing.

     "Issuer Party" means each of COAF and COAR and its parent, subsidiaries,
and affiliates and any member, shareholder, director, officer, employee, agent
or any "controlling person" (as such term is used in the Act) of any of the
following.

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     "Losses" means (i) any actual out-of-pocket loss paid by the party entitled
to indemnification or contribution hereunder and (ii) any actual out-of-pocket
costs and expenses paid by such party, including reasonable fees and expenses of
its counsel, to the extent not paid, satisfied or reimbursed from funds provided
by any other Person (provided that the foregoing shall not create or imply any
obligation to pursue recourse against any such other Person).

     "Offered Notes" means the Capital One Auto Finance Trust 2002-B Automobile
Receivable-Backed Notes, Series 2002-B, Class A-1 Notes, Class A-2-A Notes,
Class A-2-B Notes, Class A-3-A Notes, Class A-3-B Notes, Class A-4-A Notes and
Class A-4-B Notes, issued in accordance with the provisions of the Indenture.

     "Owner Trustee" means Wilmington Trust Company, not in its individual
capacity but solely in its capacity as owner trustee for Capital One Auto
Finance Trust 2002-B.

     "Person" means any individual, partnership, joint venture, corporation,
trust or unincorporated organization or any government or agency or political
subdivision thereof.

     "Prospectus" means the Preliminary Prospectus Supplement dated August 28,
2002 to the Prospectus dated June 14, 2002, and the Prospectus Supplement dated
September 4, 2002 to the Prospectus dated June 14, 2002, with respect to the
Offered Notes.

     "Servicer" means Capital One Auto Finance, Inc. as the Servicer of the
Receivables or any other Eligible Servicer acting as servicer pursuant to the
Servicing Agreement. Unless the context otherwise requires "Servicer" also
refers to any successor Servicer appointed under the Indenture or pursuant to
the Servicing Agreement.

     "Servicing Agreement" means the Servicing Agreement dated as of September
16, 2002 by and among the Owner Trustee, JPMorgan Chase Bank, as the Indenture
Trustee and the Servicer.

     "Underwriter Party" means, with respect to the Underwriters, each such
Underwriter and its parent, subsidiaries and affiliates and any shareholder,
director, officer, employee, agent or "controlling person" (as such term is used
in the Act) of any of the foregoing.

     "Underwriting Agreement" means the Underwriting Agreement by and among
COAF, Capital One Auto Receivables, LLC and the Representative as representative
of the Underwriters dated as of September 4, 2002.

     "Underwriter" means in plural form Wachovia Securities, Inc., Barclays
Capital LLC, Banc of America Securities LLC, Credit Suisse First Boston and
Deutsche Bank Securities and in singular form each of Wachovia Securities, Inc.,
Barclays Capital, Banc of America Securities LLC, Credit Suisse First Boston and
Deutsche Bank Securities.

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     Section 2. Representations and Warranties of the Insurer The Insurer
represents and warrants to each Underwriter and the each Issuer Party as
follows:

             (a) Organization and Licensing. The Insurer is a duly incorporated
     and existing New York stock insurance company licensed to do business in
     the State of New York and is in good standing under the laws of such state.

             (b) Corporate Power. The Insurer has the corporate power and
     authority to issue the Policy and execute and deliver this Agreement and to
     perform all of its obligations hereunder and thereunder.

             (c) Authorization; Approvals. The issuance of the Policy and the
     execution, delivery and performance of this Agreement have been duly
     authorized by all necessary corporate proceedings. No further approvals or
     filings of any kind, including, without limitation, any further approvals
     of or further filings with any governmental agency or other governmental
     authority, or any approval of the Insurer's board of directors or
     stockholders, are necessary for the Policy and this Agreement to constitute
     the legal, valid and binding obligations of the Insurer.

             (d) Enforceability. The Policy, when issued, and this Agreement
     will each constitute a legal, valid and binding obligation of the Insurer,
     enforceable in accordance with its terms, subject to applicable laws
     affecting the enforceability of creditors' rights generally.

             (e) Financial Information. The consolidated financial statements of
     the Insurer and its subsidiaries as of December 31, 2001 and December 31,
     2000 and for each of the three years in the period ended December 31, 2001
     incorporated by reference in the Prospectus Supplement (the "Insurer
     Financial Statements"), fairly present in all material respects the
     financial condition of the Insurer as of such date and for the period
     covered by such statements in accordance with generally accepted accounting
     principles consistently applied, and since December 31, 2001, there has
     been no material change in such financial condition of the Insurer which
     would materially and adversely affect its ability to perform its
     obligations under the Policy.

             (f) Insurer Information. The information in the Prospectus of the
     date hereof under the caption "THE NOTE GUARANTY INSURANCE POLICY AND THE
     NOTE INSURER" (the "Insurer Information") is limited and does not purport
     to provide the scope of disclosure required to be included in a prospectus
     for a registrant under the Securities Act of 1933, in connection with the
     public offer and sale of securities of such registrant. Within such limited
     scope of disclosure, the Insurer Information does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements therein, in light of the circumstances under which they
     were made, not misleading.

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             (g) No Litigation. There are no actions, suits, proceedings or
     investigations pending or, to the best of the Insurer's knowledge,
     threatened against it at law or in equity or before or by any court,
     governmental agency, board or commission or any arbitrator which, if
     decided adversely, would materially and adversely affect its condition
     (financial or otherwise) or operations of it or would materially and
     adversely affect its ability to perform its obligations under this
     Agreement or the Policy.

     Section 3. Representations and Warranties of the Underwriters. Each
Underwriter severally represents and warrants (only with respect to itself) to
the Insurer as follows:

             (a) Prospectus. It represents and warrants to and agrees with the
     Insurer that the statements in the Prospectus made in reliance upon and in
     conformity with written information relating to such Underwriter furnished
     to Capital One Auto Finance, Inc. specifically for use in the preparation
     of the Prospectus, and acknowledged in writing set forth in the second
     paragraph (regarding concessions and discounts) and the first sentence of
     the ninth paragraph (regarding marketmaking) under the caption
     "Underwriting" in the Prospectus (referred to herein as the "Underwriter
     Information"), are true and correct in all material respects.

             (b) Corporate Power. It has the corporate power and authority to
     execute and deliver this Agreement and the Underwriting Agreement and to
     perform all of its obligations hereunder and thereunder in all material
     respects.

             (c) Authorization; Approvals. The execution, delivery and
     performance of this Agreement and the Underwriting Agreement by such
     Underwriter have been duly authorized by all necessary corporate
     proceedings. No further approvals or filings of any kind, including,
     without limitation, any further approvals of or further filing with any
     governmental agency or other governmental authority, or any approval of
     such Underwriter's board of directors or stockholders, are necessary for
     this Agreement and the Underwriting Agreement to constitute the legal,
     valid and binding obligation of such Underwriter.

             (d) Enforceability. This Agreement and the Underwriting Agreement
     will each constitute a legal, valid and binding obligation of such
     Underwriter, each enforceable in accordance with its terms, subject, as to
     the enforcement of remedies, to bankruptcy, insolvency, reorganization,
     moratorium and other similar laws affecting the enforceability of
     creditors' rights generally applicable in the event of the bankruptcy,
     insolvency or reorganization of such Underwriter and to general principles
     of equity.

             (e) No Litigation. There are no actions, suits, proceedings or
     investigations pending or, to the best of such Underwriter's knowledge,
     threatened against it at law or in equity or before any court, governmental
     agency, board or commission or any arbitrator which, if decided adversely,
     would materially and adversely affect its condition (financial

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     or otherwise) or its operations or would materially and adversely affect
     its ability to perform its obligations under this Agreement and the
     Underwriting Agreement.

     Section 4. Reserved.

     Section 5. Indemnification.

             (a) The Insurer hereby agrees, upon the terms and subject to the
     conditions of this Agreement, to indemnify, defend and hold harmless each
     Issuer Party and each Underwriter Party against (i) any and all Losses
     incurred by them with respect to the offer and sale of any of the Offered
     Notes and resulting from the Insurer's breach of any of its representations
     and warranties set forth in Section 2 of this Agreement, and (ii) any and
     all Losses to which any Issuer Party or any Underwriter Party may become
     subject, under the Act or otherwise, subject to the limited scope of the
     Insurer Information described below insofar as such Losses arise out of or
     result from an untrue statement of a material fact contained in the
     Prospectus or the omission to state therein a material fact required to be
     stated therein or necessary to make the statements therein not misleading,
     in each case to the extent, but only to the extent, that such untrue
     statement or omission was made in the Insurer Information included therein;
     and provided further, that it is understood that the Insurer Information is
     limited and does not purport to provide the scope of disclosure required to
     be included in a prospectus for a registrant under the Securities Act of
     1933, in connection with the public offer and sale of securities of such
     registrant.

             (b) Each Underwriter hereby agrees, severally and not jointly, upon
     the terms and subject to the conditions of this Agreement, to indemnify,
     defend and hold harmless each Insurer Party against (i) any and all Losses
     incurred by it with respect to the offer and sale of any of the Offered
     Notes and resulting from such Underwriter's breach of any of its
     agreements, representations and warranties set forth in Section 3 of this
     Agreement and (ii) any and all Losses to which any Insurer Party may become
     subject, under the Act or otherwise, insofar as such Losses arise out of or
     result from an untrue statement of a material fact contained in the
     Prospectus Supplement or the omission to state therein a material fact
     required to be stated therein or necessary to make the statements therein
     not misleading in each case to the extent, but only to the extent, that
     such untrue statement or omission was made in the Underwriter Information
     (as defined above) included therein.

             (c) Upon the incurrence of any Losses entitled to indemnification
     hereunder, the Indemnifying Party shall reimburse the Indemnified Party
     promptly upon establishment by the Indemnified Party to the Indemnifying
     Party of the Losses incurred.

                                       5

<PAGE>

Section 6. Notice To Be Given.

        (a) Except as provided in Section 7 below with respect to contribution,
the indemnification provided herein by the Indemnifying Party shall be the
exclusive remedy of each Indemnified Party for the Losses resulting from the
Indemnifying Party's breach of a representation, warranty or agreement
hereunder; provided, however, that each Indemnified Party shall be entitled to
pursue any other remedy at law or in equity for any such breach so long as the
damages sought to be recovered shall not exceed the Losses incurred thereby
resulting from such breach.

        (b) In the event that any action or regulatory proceeding shall be
commenced or claim asserted which may entitle an Indemnified Party to be
indemnified under this Agreement, such party shall give the Indemnifying Party
written or facsimile notice of such action or claim reasonably promptly after
receipt of written notice thereof.

        (c) Upon request of the Indemnified Party, the Indemnifying Party shall
retain counsel reasonably satisfactory to the Indemnified Party to represent the
Indemnified Party and any others the Indemnifying Party may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. The Indemnifying Party may, at its option, at any time upon
written notice to the Indemnified Party, assume the defense of any proceeding
and may designate counsel reasonably satisfactory to the Indemnified Party in
connection therewith, provided that the counsel so designated would have no
actual or potential conflict of interest in connection with such representation.
Unless it shall assume the defense of any proceeding, the Indemnifying Party
shall not be liable for any settlement of any proceeding, effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Indemnifying Party agrees to indemnify the
Indemnified Party from and against any loss or liability by reason of such
settlement or judgment. The Indemnifying Party shall be entitled to participate
in the defense of any such action or claim in reasonable cooperation with, and
with the reasonable cooperation of, each Indemnified Party.

        (d) The Indemnified Party will have the right to employ its own counsel
in any such action, but the fees and expenses of such counsel will be at the
expense of such Indemnified Party unless (i) the employment of counsel by the
Indemnified Party at the Indemnifying Party's expense has been authorized in
writing by the Indemnifying Party, (ii) the Indemnifying Party has not in fact
employed counsel to assume the defense of such action within a reasonable time
after receiving notice of the commencement of the action or (iii) the named
parties to any such action include the Indemnifying Party on the one hand and,
on the other hand, the Indemnified Party, and representation of both parties by
the same counsel would be inappropriate due to actual or potential differing
interests between them (in which case if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party,

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<PAGE>

the Indemnifying Party shall not have the right to assume the defense of such
action or proceeding on such Indemnified Party's behalf), in each of which cases
the reasonable fees and expenses of counsel (including local counsel) will be at
the expense of the Indemnifying Party, and all such fees and expenses will be
reimbursed promptly as they are incurred. In the event that any expenses so paid
by the Indemnifying Party are subsequently determined not to be required to be
borne by the Indemnifying Party hereunder, the party which received such payment
shall promptly refund to the Indemnifying Party the amount so paid by such
Indemnifying Party. Notwithstanding the foregoing, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, the
Indemnifying Party shall not be liable for the fees and expenses of more than
one counsel for the Issuer Parties, more than one counsel for all Underwriter
Parties and more than one counsel for all Insurer Parties, as applicable.

        (e) The Indemnified Parties shall cooperate with the Indemnifying
Parties in resolving any event, which would give rise to an indemnity obligation
pursuant to Section 5 hereof in the most efficient manner.

        (f) No settlement of any such claim or action shall be entered into
without the consent of each Indemnified Party who is subject to such claim or
action, on the one hand, and each Indemnifying Party who is subject to such
claim or action, on the other hand; provided, however, that the consent of such
Indemnified Party shall not be required if such settlement fully discharges,
with prejudice against the plaintiff, the claim or action against such
Indemnified Party.

        (g) Any failure by an Indemnified Party to comply with the provisions of
this Section shall relieve the Indemnifying Party of liability only if such
failure is materially prejudicial to any legal pleadings, grounds, defenses or
remedies in respect thereof or the Indemnifying Party's financial liability
hereunder, and then only to the extent of such prejudice.

Section 7. Contribution.

        (a) To provide for just and equitable contribution if the
indemnification provided by the Insurer is determined to be unavailable for any
Underwriter Party (other than pursuant to Section 4 or 5 of this Agreement), or
if the indemnification provided by the Underwriters is determined to be
unavailable for any Insurer Party (other than pursuant to Section 4 or 6 of this
Agreement), the Insurer and the relevant Underwriter shall contribute to the
aggregate costs of liabilities arising from any breach of their respective
representations and warranties set forth in this Agreement on the basis of the
relative fault of all Insurer Parties and all relevant Underwriter Parties.

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<PAGE>

        (b) To provide for just and equitable contribution if the
indemnification provided by the Insurer is determined to be unavailable for the
Issuer Parties (other than pursuant to Section 5 or 6 of this Agreement), the
Insurer shall contribute to the aggregate cost of liabilities arising from any
breach of their respective representations and warranties set forth in this
Agreement on the basis of the relative fault of all Insurer Parties and the
Issuer Parties.

        (c) Notwithstanding anything in this Section 7 to the contrary, (i) the
Insurer shall not be required to contribute an amount in excess of the amount by
which the total of the insurance premiums that have been received by the Insurer
under the Insurance Agreement exceeds the amount of any damages that the Insurer
has otherwise been required to pay in respect of any breach by the Insurer of
the representations and warranties contained in Section 2 hereof, and (ii) no
Underwriter shall be required to contribute an amount in excess of the amount by
which the total underwriting fees, discounts and commissions received by such
Underwriter exceeds the amount of any damages that such Underwriter has
otherwise been required to pay in respect of any breach by such Underwriter of
its representations and warranties contained in Section 3 hereof.

        (d) The relative fault of each Indemnifying Party, on the one hand, and
of each Indemnified Party, on the other hand, shall be determined by reference
to, among other things, whether the breach of, or alleged breach of, any of its
representations and warranties set forth in Section 2 or 3 of this Agreement
relates to information supplied by, or action within the control of, the Insurer
Party or the relevant Underwriter Party and the Parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
breach.

        (e) The Parties agree that the Insurer shall be solely responsible for
the Insurer Information and for the Insurer Financial Statements, that each
Underwriter shall be responsible for the Underwriter Information provided by
such Underwriter in writing for use in the Prospectus Supplement.

        (f) No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.

        (g) The indemnity agreements contained in this Agreement shall remain
operative and in full force and effect, regardless of (i) any investigation made
by or on behalf of any Underwriter Party, any Insurer Party or any Issuer Party,
(ii) the issuance of any Offered Notes or the Policy or (iii) any termination of
this Agreement.

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<PAGE>

        (h) Upon the incurrence of any Losses entitled to contribution
     hereunder, the contributor shall reimburse the party entitled to
     contribution promptly upon establishment by the party entitled to
     contribution to the contributor of the Losses incurred.

        (i) The Underwriters shall be severally and not jointly liable for any
     contribution required by this Section 7.

     Section 8. Notices. All notices and other communications provided for
under this Agreement shall be addressed to the address set forth below as to
each party or at such other address as shall be designated by a party in a
written notice to the other party.

        (a) If to the Insurer:

            MBIA Insurance Corporation
            113 King Street
            Armonk, NY 10504
            Attention: Insured Portfolio Management--Structured Finance (IPM-SF)
            Facsimile:(914) 765-3810
            Confirmation:(914) 273-4545

        (b) If to the Issuer Parties:

            Capital One Auto Finance, Inc.
            8000 Jones Branch Drive
            McLean, Virginia 22202
            Facsimile: (703) 875-1389
            Confirmation: (703) 875-1305

            With a copy to Legal Department
            Facsimile: (703) 875-1589
            Confirmation: (703) 875-1000

            Capital One Auto Receivables, LLC
            8000 Jones Branch Drive
            McLean, Virginia 22202
            Facsimile: (703) 875-1389
            Confirmation: (703) 875-1305

            With a copy to Legal Department
            Facsimile: (703) 875-1589
            Confirmation: (703) 875-1000

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<PAGE>

        (c) If to the Representative:

            Wachovia Securities, Inc.
            NC0610
            One Wachovia Center
            301 South College Street
            Charlotte, North Carolina  28288-0610
            Attention:  Curt Sidden, Managing Director

     Section 9. Governing Law, Etc. This Agreement shall be deemed to be a
contract under the laws of the State of New York and shall be governed by and
construed in accordance with the laws of the State of New York without regard to
its conflicts of laws provisions. This Agreement may not be assigned by any
party without the express written consent of each other party. Amendments of
this Agreement shall be in writing signed by each party. This Agreement shall
not be effective until executed by each of the Insurer, each Issuer Party and
the Underwriters.

     Section 10. Other Obligations Not Effected. This Agreement in no way limits
or otherwise affects the indemnification obligations of the Underwriters and
COAF under the Underwriting Agreement.

     Section 11. Limitations. Nothing in this Agreement shall be construed as a
representation or undertaking by the Insurer concerning maintenance of the
rating currently assigned to its claims-paying ability by Moody's Investors
Service, Inc. ("Moody's") and/or Standard & Poor's, a division of The
McGraw-Hill Companies, Inc. ("S&P") or any other rating agency (collectively,
the "Rating Agencies").

     Section 12. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall together constitute but one and the same
instrument.

     Section 13. Non-petition. So long as the Insurance Agreement is in effect,
and for one year and one day following its termination, each of the parties
hereto agree that it (with respect to itself) will not file any involuntary
petition or otherwise institute any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceeding or other proceeding under any federal or
state bankruptcy or similar law against the Issuer Parties or the Seller.

      [Remainder of page intentionally left blank; signature page follows]

                                       10

<PAGE>

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

                                        MBIA INSURANCE CORPORATION

                                        By    /s/ Lisa A. Wilson
                                              --------------------------------
                                        Title Assistant Secretary

                                        WACHOVIA SECURITIES, INC., for itself
                                        and as Representative of the
                                        Underwriters

                                        By    /s/ Curt Sidden
                                              --------------------------------
                                        Title Director

                                        By    /s/ Steven Ellis
                                              --------------------------------
                                        Title Director

                                        CAPITAL ONE AUTO FINANCE, INC., as
                                        Issuer Party

                                        By    /s/ Jeffery A. Elswick
                                              --------------------------------
                                        Title Manager of Securitization

                                        CAPITAL ONE AUTO RECEIVABLES, LLC, as
                                        Issuer Party

                                        By    /s/ Jeffery A. Elswick
                                              --------------------------------
                                        Title President<PAGE>
                                                                    EXHIBIT 10.1

                      FIRST AMENDMENT TO CREDIT AGREEMENT

         THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "Agreement") is made and
entered into as of this 24th day of September, 2002, effective in accordance
with Section 4 below, by and among VERIDIAN CORPORATION, a Delaware corporation
(the "Borrower"), the financial institutions from time to time party to the
Original Credit Agreement referred to below (the "Lenders") and WACHOVIA BANK,
NATIONAL ASSOCIATION, a national banking association, as Administrative Agent
for the Lenders (the "Administrative Agent").

                              Statement of Purpose

         The Borrower, the Lenders and the Administrative Agent are parties to a
Credit Agreement dated as of June 10, 2002 (the "Original Credit Agreement"), by
and among the Borrower, the Lenders, and the Administrative Agent pursuant to
which the Lenders have extended certain credit facilities to the Borrower.

         Pursuant to the terms of the Signal Purchase Agreement dated as of
August 12, 2002, by and among Signal Corporation, a Virginia corporation
("Signal"), Roger Mody and Lori Mody (the "Individual Shareholders"), as
sellers, and the Borrower, as purchaser, the Borrower has agreed to acquire all
the issued and outstanding capital stock of Signal and indirectly all of the
outstanding membership interests in Signal Services LLC, a Virginia limited
liability company ("Signal Services") for a purchase price not to exceed $230
million (subject to working capital adjustments in accordance with the
definitive Signal Purchase Agreement) (the "Acquisition"). Promptly after the
effective date hereof, Signal will change its name to Veridian IT Services, Inc.

         A portion of the purchase price will be paid through the issuance of
subordinated promissory notes in the aggregate original principal amount of
Twenty Five Million Dollars ($25,000,000) (the "Signal Subordinated Financing")
by the Borrower to the Individual Shareholders pursuant to a subordinated note
agreement dated as of even date herewith (the "Signal Subordinated Note
Agreement").

         Pursuant to a Sale and Assignment Agreement dated on or about the date
hereof between the Borrower as "Purchaser" and Scott Goss as "Owner", the
Borrower intends to purchase from the Owner, contemporaneously with the
Acquisition, all of the Owner's right title and interest in and to the "PM
Reports" computer programs and all related documentation and intellectual
property for a maximum aggregate purchase price of $3,600,000.00 (the "Software
Acquisition").

         The Borrower has requested that the Lenders (a) consent to the
Acquisition, (b) consent to the Signal Subordinated Financing, (c) consent to
the Software Acquisition and (d) amend and restate the Original Credit Agreement
(as so amended and restated, the "Amended and Restated Credit Agreement") in
certain respects as more fully described below.

         Subject to the terms and conditions of this Agreement, the
Administrative Agent and the Lenders are willing to agree to the requested
consents and amendments.

<PAGE>

         NOW THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:

        SECTION 1. Definitions. All capitalized, undefined terms used in this
Agreement shall have the meanings assigned thereto in the Amended and Restated
Credit Agreement.

        SECTION 2. Consents. Subject to the conditions to effectiveness set
forth in Section 4 below, the Administrative Agent and the Lenders
hereby consent to (a) the Acquisition and (b) the Signal Subordinated Financing
and (c) the Software Acquisition.

        SECTION 3. Amendment. Subject to the conditions to effectiveness set
forth in Section 4 below, the Original Credit Agreement is hereby amended and
restated in the form attached hereto as Exhibit A. The Administrative Agent is
hereby authorized to execute the Amended and Restated Credit Agreement on behalf
of the Lenders and to make such adjustments to the Register as are necessary to
give effect to this Agreement.

        SECTION 4. Effectiveness. This Agreement shall become effective upon the
satisfaction of the following conditions (all of which are intended to be
satisfied contemporaneously with the closing of the Acquisition), as determined
by the Administrative Agent:

             (a) receipt by the Administrative Agent of a duly authorized and
executed original of this Agreement by the Borrowers and the Guarantors;

             (b) receipt by the Administrative Agent of sufficient Lender
authorizations, to authorize the execution of this Agreement by the
Administrative Agent;

             (c) receipt by the Administrative Agent of a short-form certificate
of the secretary or assistant secretary of each of the Borrower and its
Subsidiaries party to any Loan Document as of the Original Closing Date
certifying that the articles of incorporation and bylaws delivered pursuant to
the Original Credit Agreement continue unchanged (or, if applicable, specifying
the nature of any changes thereto) and remain in full force and effect as of the
date hereof, and attaching (i) resolutions duly adopted by the Board of
Directors of the Borrower or such Subsidiary authorizing the borrowings
contemplated hereunder and the execution, delivery and performance of this
Agreement and the other Loan Documents to which the Borrower or such Subsidiary
is a party and (ii) certificates as of a recent date of the good standing of the
Borrower or such Subsidiary from its respective state of organization;

             (d) receipt by the Administrative Agent of a certificate of the
secretary or assistant secretary of Signal certifying as to the incumbency and
genuineness of the signature of each officer of Signal executing Loan Documents
to which Signal is a party and certifying that attached thereto is a true,
correct and complete copy of (i) the articles of incorporation of Signal and all
amendments thereto, certified as of a recent date by the appropriate
Governmental Authority in its jurisdiction of incorporation, (ii) the bylaws of
Signal as in effect on the date of such certifications, (iii) resolutions duly
adopted by the Board of Directors of Signal authorizing the transactions
contemplated under this Agreement and the delivery of a joinder agreement in
form and
<PAGE>

substance satisfactory to the Administrative Agent pursuant to Section
9.11 of the Credit Agreement (a "Joinder Agreement") and the execution, delivery
and performance of each Loan Document to which Signal is a party, and (iv)
certificates as of a recent date of the good standing of Signal under the laws
of its jurisdiction of organization and, to the extent requested by the
Administrative Agent, each other jurisdiction where Signal is qualified to do
business;

             (e) receipt by the Administrative Agent of a certificate of the
secretary or assistant secretary of Signal Services certifying as to the
incumbency and genuineness of the signature of each officer of Signal Services
executing Loan Documents to which Signal Services is a party and certifying that
attached thereto is a true, correct and complete copy of (i) the certificate of
organization of Signal Services and all amendments thereto, certified as of a
recent date by the appropriate Governmental Authority in its jurisdiction of
organization, (ii) the operating agreement of Signal Services as in effect on
the date of such certifications, (iii) evidence of limited liability company
action of Signal Services authorizing the transactions contemplated under this
Agreement and the delivery of a Joinder Agreement and the execution, delivery
and performance of each Loan Document to which Signal Services is a party, and
(iv) certificates as of a recent date of the good standing of Signal Services
under the laws of its jurisdiction of organization and, to the extent requested
by the Administrative Agent, each other jurisdiction where Signal Services is
qualified to do business;

             (f) receipt by the Administrative Agent of an executed
acquisition certificate, in form and substance satisfactory to the
Administrative Agent, in connection with the Acquisition and attaching (i) the
definitive Signal Purchase Agreement, with all corresponding schedules and
exhibits, (ii) the definitive Signal Subordinated Note Agreement and (iii)
copies of the subordinated promissory notes evidencing the Signal Subordinated
Financing;

             (g) receipt by the Administrative Agent of duly authorized,
executed and delivered copies of the Joinder Agreement and such additional
certificates, instruments and other documents in connection with the Acquisition
(including, without limitation, each agreement or document required to be
delivered pursuant to Section 9.11 of the Original Credit Agreement,
(notwithstanding the times periods set forth therein), each in form and
substance satisfactory thereto) as are reasonably requested by the
Administrative Agent to create and perfect a security interest, for the ratable
benefit of the Administrative Agent and the Lenders, in all of Signal's and
Signal Services' personal property to secure the Obligations under the Amended
and Restated Credit Agreement;

             (h) receipt by the Administrative Agent of a Perfection Certificate
for Signal and Signal Services;

             (i) receipt by the Administrative Agent of written authorization
from Signal and Signal Services to file in the appropriate filing offices UCC-1
financing statements in form and substance acceptable to the Administrative
Agent naming Signal and Signal Services, respectively, as "Debtor";
<PAGE>

             (j) receipt by the Administrative Agent of (i) original stock
certificates issued to the Borrower by Signal and corresponding stock powers and
(ii) certificates (if any) evidencing the Borrower's limited liability company
interests in Signal Services;

             (k) receipt by the Administrative Agent of a satisfactory legal
opinion of counsel to the Borrower and its Subsidiaries (after giving effect to
the Acquisition) regarding this Agreement and the Joinder Agreements; and

             (l) the Borrower's payment of all outstanding fees and expenses of
the Administrative Agent (including without limitation, legal fees and expenses)
incurred in connection with the preparation and negotiation of this Agreement
and all documents, certificates and other instruments delivered in connection
therewith.

        SECTION 5. Limited Consent and Amendment. Except as expressly provided
in this Agreement, the Amended and Restated Credit Agreement and each other Loan
Document shall continue to be, and shall remain, in full force and effect. This
Agreement shall not be deemed or otherwise construed (a) to be a waiver of, or
consent to or a modification or amendment of, any other term or condition of the
Amended and Restated Credit Agreement or any other Loan Document, (b) to
prejudice any other right or remedies that the Administrative Agent or the
Lenders, or any of them, may now have or may have in the future under or in
connection with the Amended and Restated Credit Agreement or the Loan Documents,
as such documents may be amended, restated or otherwise modified from time to
time, (c) to be a commitment or any other undertaking or expression of any
willingness to engage in any further discussion with the Borrower or any other
person, firm or corporation with respect to any waiver, amendment, modification
or any other change to the Amended and Restated Credit Agreement or the Loan
Documents or any rights or remedies arising in favor of the Lenders or the
Administrative Agent, or any of them, under or with respect to any such
documents or (d) to be a waiver of, or consent to or a modification or amendment
of, any other term or condition of any other agreement by and among the
Borrower, on the one hand, and the Administrative Agent or any other Lender, on
the other hand.

        SECTION 6. Representations and Warranties/No Default. By its execution
hereof, and after giving effect to this Agreement, the Borrower hereby certifies
that (a) each of the representations and warranties set forth in the Amended and
Restated Credit Agreement and the other Loan Documents is true and correct as of
the date hereof as if fully set forth herein (other than representations and
warranties which speak as of a specific date pursuant to the Amended and
Restated Credit Agreement, which representations and warranties shall have been
true and correct as of such specific dates) and that as of the date hereof
(after giving effect to the provisions of this Agreement) no Default or Event of
Default has occurred and is continuing, and (b) the execution, delivery and
performance of this Agreement have been authorized by all requisite corporate
action on the part of the Borrower.

        SECTION 7. Confirmation of all Loan Documents by Borrower. The Borrower
hereby expressly consents to this Agreement. The Borrower hereby (a) reaffirms
all of its respective covenants, representations, warranties and other
obligations set forth in the Amended and Restated Credit Agreement and the other
Loan Documents to which it is a party and (b)
<PAGE>

acknowledges, represents and agrees that its respective covenants,
representations, warranties and other obligations set forth in the Amended and
Restated Credit Agreement, the Joinder Agreement and the other Loan Documents to
which it is a party remain in full force and effect.

        SECTION 8. Confirmation of all Loan Documents by Guarantors. Each of
the Subsidiaries of the Borrower on the signature pages hereto (each a
"Guarantor", and collectively, the "Guarantors") hereby expressly consents to
this Agreement. Each Guarantor hereby (a) reaffirms all of its respective
covenants, representations, warranties and other obligations set forth in the
Security Documents and the other Loan Documents to which it is a party and (b)
acknowledges, represents and agrees that its respective covenants,
representations, warranties and other obligations set forth in the Security
Documents, the Joinder Agreement and the other Loan Documents to which it is a
party remain in full force and effect.

        SECTION 9. Expenses. The Borrower shall pay all reasonable
out-of-pocket expenses of the Administrative Agent in connection with the
preparation, execution and delivery of this Agreement, including, without
limitation, the reasonable fees and disbursements of counsel for the
Administrative Agent.

        SECTION 10. Governing Law. This Agreement, the Notes and the other Loan
Documents, unless otherwise expressly set forth therein, shall be governed by,
construed and enforced in accordance with the laws of the State of North
Carolina, without reference to the conflicts or choice of law principles
thereof.

        SECTION 11. Counterparts. This Agreement may be executed in separate
counterparts, each of which when executed and delivered is an original but all
of which taken together constitute one and the same instrument.

                            [Signature Pages Follow]

<PAGE>

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed under seal by their duly authorized representatives, all as of the
day and year first above written.

[CORPORATE SEAL]         VERIDIAN CORPORATION, as Borrower

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

<PAGE>

                         WACHOVIA BANK, NATIONAL ASSOCIATION,
                         as Administrative Agent and Lender and on behalf of the
                         other Lenders

                         By:    /s/ SCOTT SANTA CRUZ
                             ---------------------------------------------------
                             Name:  Scott Santa Cruz
                                    --------------------------------------------
                             Title: Director
                                    --------------------------------------------

                         GUARANTORS:

[CORPORATE SEAL]         VERIDIAN ENGINEERING, INC., as Guarantor

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

[CORPORATE SEAL]         VERIDIAN SYSTEMS DIVISION, INC.,
                         as Guarantor

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

[CORPORATE SEAL]         VERIDIAN SYSTEMS INCORPORATED,
                         as Guarantor

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

[CORPORATE SEAL]         MRJ GROUP, INC., as Guarantor

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

<PAGE>

[CORPORATE SEAL]         VERIDIAN INFORMATION SOLUTIONS, INC., as Guarantor

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

[CORPORATE SEAL]         VERIDIAN COMMERCIAL OPERATIONS INC.
                         (f/k/a Veritect, Inc.), as Guarantor

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

[CORPORATE SEAL]         SIGNAL CORPORATION, as Guarantor

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

[CORPORATE SEAL]         SIGNAL SERVICES LLC, as Guarantor

                         By:    /s/ JAMES P. ALLEN
                             ---------------------------------------------------
                             Name:  James P. Allen
                                    --------------------------------------------
                             Title: Sr. Vice President & Chief Financial Officer
                                    --------------------------------------------

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