Document:

Exhibit 10.54

MERRILL LYNCH              WCMA(R) REDUCING REVOLVER LOAN AND SECURITY AGREEMENT

WCMA REDUCING  REVOLVER(SM)  LOAN AND SECURITY  AGREEMENT N0.  7WD-07018  ("Loan
Agreement")  dated as of June 19, 2001,  between  RENT-A-WRECK OF AMERICA,  INC.
D/B/A "RENT-A-WRECK" AND "PRICELESS", a corporation organized and existing under
the laws of the State of  Delaware  having its  principal  office at 10324 South
Dolfield Road,  Owings Mill, MD 21117  ("Customer"),  and MERRILL LYNCH BUSINESS
FINANCIAL SERVICES INC., a corporation  organized and existing under the laws of
the State of Delaware  having its principal  office at 222 North LaSalle Street,
Chicago, IL 60601 ("MLBFS").

In accordance with that certain WORKING CAPITAL  MANAGEMENT(R) ACCOUNT AGREEMENT
N0. 7WD-07018 ("WCMA Agreement") between Customer and MLBFS' affiliate,  MERRILL
LYNCH, PIERCE, FENNER & SMITH INCORPORATED  ("MLPF&S"),  Customer has subscribed
to the WCMA Program  described in the WCMA  Agreement.  The WCMA Agreement is by
this reference incorporated as a part hereof. In conjunction therewith, Customer
has  requested  that  MLBFS  make a WCMA  Reducing  Revolver  Loan (a  "Reducing
Revolver")  to  Customer in the amount and upon the terms  hereafter  specified,
and, subject to the terms and conditions  hereafter set forth,  MLBFS has agreed
to provide a Reducing Revolver for Customer.

A Reducing  Revolver is a term credit facility,  similar to a conventional  term
loan,  but funded out of a line of credit under the WCMA Program  ("WCMA Line of
Credit")  in the  amount of the  initial  loan.  With a Reducing  Revolver:  (i)
interest will generally be charged each month to Customer's  WCMA account,  and,
so long as the WCMA Line of Credit is in effect,  paid with an  additional  loan
under  the WCMA  Line of  Credit  (i.e.,  added to the loan  balance),  (ii) the
maximum  WCMA Line of Credit will be reduced each month by the amount that would
be payable on account of principal if the Reducing  Revolver were a conventional
term loan  amortized  over the same term and in the same manner as the  Reducing
Revolver,  and (iii)  Customer will be required to make  sufficient  payments on
account of the Reducing  Revolver to assure that the outstanding  balance of the
Reducing  Revolver  does not at any time exceed the Maximum WCMA Line of Credit,
as reduced each month.

Absent a prepayment  by Customer,  this  structure  results in required  monthly
payments  for the  Reducing  Revolver  that  are  substantially  the same as the
required  monthly  payments for a conventional  term loan with the same term and
amortization. However, unlike most conventional term loans, because it is funded
out of a line of credit,  the Reducing  Revolver  permits  both a prepayment  in
whole  or in  part  at  any  time,  and,  subject  to  certain  conditions,  the
reborrowing on a revolving  basis of any such prepaid  amounts up to the Maximum
WCMA Line of Credit, as reduced each month. The structure  therefore will enable
Customer at its option to use any excess or temporary  cash balances that it may
have from time to time to prepay the Reducing  Revolver and thereby  effectively
reduce interest expense on the Reducing  Revolver without  impairing its working
capital.

Accordingly, and in consideration of the premises and of the mutual covenants of
the parties hereto, Customer and MLBFS hereby agree as follows:

                             ARTICLE I. DEFINITIONS

1.1  Specific  Terms.  In  addition  to terms  defined  elsewhere  in this  Loan
Agreement,  when used  herein  the  following  terms  shall  have the  following
meanings:

(a) "Account  Debtor" shall mean any party who is or may become  obligated  with
respect to an Account or Chattel Paper.

(b) "Additional  Agreements" shall mean all agreements,  instruments,  documents
and opinions  other than this Loan  Agreement,  whether with or from Customer or
any other party, which are contemplated hereby or otherwise  reasonably required
by MLBFS in connection  herewith,  or which  evidence the creation,  guaranty or
collateralization  of any of the  Obligations  or the granting or  perfection of
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liens or security  interests upon the Collateral or any other collateral for the
Obligations.

(c) "Bankruptcy  Event" shall mean any of the following:  (i) a proceeding under
any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt or
receivership  law or statute  shall be filed or  consented to by Customer or any
Guarantor,  or (ii) any such proceeding  shall be filed against  Customer or any
Guarantor  and shall not be dismissed or withdrawn  within sixty (60) days after
filing;  or (iii) Customer or any Guarantor shall make a general  assignment for
the benefit of creditors; or (iv) Customer or any Guarantor shall generally fail
to pay or admit in writing its inability to pay its debts as they become due: or
(v) Customer or any Guarantor shall be adjudicated a bankrupt or insolvent.

(d)  "Business  Day" shall mean any day other than a Saturday,  Sunday,  federal
holiday or other day on which the New York Stock Exchange is regularly closed.

(e) "Closing  Date" shall mean the date upon which all  conditions  precedent to
MLBFS'  obligation  to make the first  advance on account of the Loan shall have
been met to the satisfaction of MLBFS.

(f)  "Collateral"  shall mean all  Accounts,  Chattel  Paper,  Contract  Rights,
Inventory,   Equipment,   Fixtures,   General  Intangibles,   Deposit  Accounts,
Documents,  Instruments,  Investment  Property and Financial Assets of Customer,
howsoever  arising,  whether  now owned or  existing  or  hereafter  acquired or
arising and wherever located;  together with all parts thereof  (including spare
parts),  all  accessories,   and  accessions  thereto,  all  books  and  records
(including  computer  records)  directly related  thereto,  all proceeds thereof
(including,  without limitation,  proceeds in the form of Accounts and insurance
proceeds), and the additional collateral described in Section 4.6 (b) hereof.

(g)  "Commitment  Fee" shall mean a fee of $2,500.00  due to MLBFS in connection
with this Loan Agreement.

(h)  "Conversion  Date" shall mean the first to occur of the date of funding the
final  advance on  account  of the Loan  permitted  under the terms  hereof,  or
December 31, 2001.

(i) "Default"  shall mean either an "Event of Default" as defined in Section 4.5
hereof,  or an event which with the giving of notice,  passage of time, or both,
would constitute such an Event of Default.

(j) "General  Funding  Conditions"  shall mean each of the following  conditions
precedent to the  obligation  of MLBFS to make the Loan or any  Subsequent  WCMA
Loan hereunder:  (i) Customer shall have validly  subscribed to and continued to
maintain  the WCMA  Account  with  MLPF&S,  and the WCMA  Account  shall then be
reflected as an active  "Commercial" WCMA Account (i.e., one with line of credit
capabilities)  on MLPF&S'  WCMA  computer  system;  (ii) no  Default  shall have
occurred and be  continuing  or would result from the making of the Loan or such
Subsequent  WCMA Loan by MLBFS;  (iii)  there  shall  not have  occurred  and be
continuing any material adverse change in the business or financial condition of
Customer or any Guarantor;  (iv) all  representations and warranties of Customer
or any Guarantor  herein or in any Additional  Agreements shall then be true and
correct  in all  material  respects;  (v) MLBFS  shall have  received  this Loan
Agreement  and all  Additional  Agreements,  duly executed and filed or recorded
where  applicable,  all of  which  shall  be in form  and  substance  reasonably
satisfactory  to MLBFS;  (vi) the  Commitment  Fee shall have been paid in full;
(vii)  MLBFS shall have  received,  as and to the extent  applicable,  copies of
invoices,  bills of sale,  loan payoff letters and/or other evidence  reasonably
satisfactory  to it that the proceeds of the Loan will satisfy the Loan Purpose;
(viii) MLBFS shall have received  evidence  reasonably  satisfactory to it as to
the ownership of the  Collateral and the perfection and priority of MLBFS' liens
and security interests  thereon,  as well as the ownership of and the perfection
and priority of MLBFS' liens and security  interests on any other collateral for
the Obligations  furnished  pursuant to any of the Additional  Agreements;  (ix)
MLBFS  shall  have  received  evidence  reasonably  satisfactory  to it  of  the
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insurance  required hereby or by any of the Additional  Agreements;  and (x) any
additional  conditions  specified in the "WCMA Reducing  Revolver Loan Approval"
letter executed by MLBFS with respect to the  transactions  contemplated  hereby
shall have been met to the reasonable satisfaction of MLBFS.

(k)  "Guarantor"  shall  mean a person or entity who has  either  guaranteed  or
provided collateral for any or all of the Obligations;  and "Business Guarantor"
shall   mean   any  such   Guarantor   that  is  a   corporation,   partnership,
proprietorship, limited liability company or other entity regularly engaged in a
business activity.

(l) "Interest Due Date" shall mean the last Business Day of each calendar  month
during the term hereof (or, if Customer makes special  arrangements with MLPF&S,
on the last Friday of each calendar month during the term hereof).

(m) "Interest Rate" shall mean a variable per annum rate equal to the sum of (i)
2.90% per annum,  and (ii) the interest rate from time to time  published in the
"Money  Rates"  section of The Wall  Street  Journal as the  "Dealer  Commercial
Paper" rate for 30-day high-grade  unsecured notes sold through dealers by major
corporations (the "30-day Dealer Commercial Paper Rate"). The Interest Rate will
change as of the date of  publication  in The Wall  Street  Journal  of a 30-day
Dealer  Commercial  Paper  Rate that is  different  from that  published  on the
preceding Business Day. In the event that The Wall Street Journal shall, for any
reason,  fail or cease to publish the 30-day Dealer Commercial Paper Rate, MLBFS
will choose a reasonably  comparable index or source to use as the basis for the
Interest Rate.

(n) "Loan" shall mean the specific  multiple advance Reducing  Revolver by MLBFS
to Customer  pursuant to this Agreement for the Loan Purpose and in an aggregate
amount equal to the Loan Amount.

(o) "Loan  Amount"  shall mean an amount equal to the lesser of:  (i)100% of the
amount  required by Customer  to satisfy or fulfill the Loan  Purpose,  (ii) the
aggregate amount which Customer shall request be advanced by MLBFS on account of
the Loan Purpose on or prior to the Conversion Date, or (iii) $500,000.00.

(p) "Loan  Purpose"  shall mean the purpose  for which the  proceeds of the Loan
will be used; to wit: to purchase vehicles.

(q)  "Location  of Tangible  Collateral"  shall mean the address of Customer set
forth at the beginning of this Loan  Agreement,  together with any other address
or  addresses  set forth on an exhibit  hereto as being a Location  of  Tangible
Collateral.

(r)  "Maximum  WCMA Line of Credit"  shall mean the  maximum  aggregate  line of
credit which MLBFS will extend to Customer  subject to the terms and  conditions
hereof,  as the same shall be increased by advances prior to the Conversion Date
and reduced each month  thereafter in accordance  with the terms hereof.  On the
Conversion Date, the Maximum WCMA Line of Credit will equal the Loan Amount.

(s) "Obligations" shall mean all liabilities, indebtedness and other obligations
of Customer  to MLBFS,  howsoever  created,  arising or  evidenced,  whether now
existing  or  hereafter  arising,  whether  direct  or  indirect,   absolute  or
contingent, due or to become due, primary or secondary or joint or several, and,
without limiting the foregoing, shall include interest accruing after the filing
of  any  petition  in  bankruptcy,  and  all  present  and  future  liabilities,
indebtedness and obligations of Customer under this Loan Agreement.

(t) "Permitted  Liens" shall mean with respect to the Collateral:  (i) liens for
current taxes not delinquent, other non-consensual liens arising in the ordinary
course of business  for sums not due,  and, if MLBFS'  rights to and interest in
the Collateral are not materially and adversely affected thereby, any such liens
for  taxes or other  non-consensual  liens  arising  in the  ordinary  course of
business being contested in good faith by appropriate proceedings; (ii) liens in
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favor of MLBFS;  (iii) liens which will be  discharged  with the proceeds of the
initial WCMA Loan;  and (iv) any other liens  expressly  permitted in writing by
MLBFS.

(u)  "Subsequent  WCMA  Loan"  shall  mean each WCMA Loan  other  than the Loan,
including, without limitation, each WCMA Loan to pay accrued interest.

(v)  "Termination  Date" shall mean the first to occur of: (i) the last Business
Day of the sixtieth (60th) full calendar month following the Conversion Date, or
(ii) if earlier,  the date of termination of the WCMA Line of Credit pursuant to
the terns hereof.

(w) "WCMA  Account"  shall  mean and  refer to the  Working  Capital  Management
Account of Customer with MLPF&S identified as WCMA Account No. 7WD-07018 and any
successor Working Capital Management Account of Customer with MLPF&S.

(x) "WCMA Loan" shall mean each advance made by MLBFS  pursuant to the WCMA Line
of Credit, including the Loan and each Subsequent WCMA Loan.

(y) "WCMA Loan  Balance"  shall  mean an amount  equal to the  aggregate  unpaid
principal balance of all WCMA Loans.

1.2 Other Terms.  Except as otherwise defined herein: (i) all terms used in this
Loan  Agreement  which are  defined in the Uniform  Commercial  Code of Illinois
("UCC") shall have the meanings set forth in the UCC, and (ii) capitalized terms
used  herein  which  are  defined  in the  WCMA  Agreement  (including,  without
limitation,  "Money Accounts",  "Minimum Money Accounts Balance", "WCMA Directed
Reserve  Program" and "WCMA  Program")  shall have the meanings set forth in the
WCMA Agreement.

                              ARTICLE II. THE LOAN

2.1 Commitment.  Subject to the terms and conditions hereof, MLBFS hereby agrees
to make the Loan to Customer, and Customer hereby agrees to borrow the Loan from
MLBFS.  The Loan will be funded in up to four separate  advances as requested by
Customer prior to the Conversion Date;  provided,  however,  that Customer shall
not request  funding of, and MLBFS shall not be obligated to fund,  any advances
on account of the Loan in an amount less than  $125,000.00.  Except as otherwise
provided in Section 3.1 hereof, each such advance will be disbursed by MLBFS out
of the WCMA Line of Credit  either  directly  to the  applicable  third party or
parties on account of the Loan  Purpose or to  reimburse  Customer  for  amounts
directly expended by it for the Loan Purpose;  all as directed by Customer in an
Advance  Certificate  to be executed and delivered to MLBFS prior to the date of
each funding.

2.2 Conditions of MLBFS' Obligation.  The Closing Date and MLBFS' obligations to
activate the WCMA Line of Credit,  as hereafter set forth, and make each advance
on  account of the Loan prior to the  Conversion  Date are  subject to the prior
fulfillment of each of the following conditions;  (a) not less than two Business
Days prior to any requested  funding date,  MLBFS shall have received an Advance
Certificate,  duly executed by Customer,  setting forth, among other things, the
amount of such  advance and the method of payment and  payee(s) of the  proceeds
thereof; (b) after giving effect to such advance, the WCMA Loan Balance will not
exceed  either  the  Maximum  WCMA Line of Credit  or the Loan  Amount;  (c) the
Conversion  Date  shall  not then  have  occurred;  and (d) each of the  General
Funding  Conditions  shall  then have been met or  satisfied  to the  reasonable
satisfaction of MLBFS.

2.3  Commitment  Fee. In  consideration  of the agreement by MLBFS to extend the
Loan and any Subsequent WCMA Loans to Customer in accordance with and subject to
the terms hereof, Customer has paid or shall, on or before the Closing Date pay,
the  Commitment  Fee  to  MLBFS.  Customer  acknowledges  and  agrees  that  the
Commitment  Fee has been fully  earned by MLBFS,  and that it will not under any
circumstances be refundable.
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2.4 Use of Loan  Proceeds.  Unless  otherwise  agreed by MLBFS in  writing,  the
proceeds of the Loan shall be used solely for the Loan Purpose.  The Proceeds of
each Subsequent WCMA Loan initiated by Customer shall be used by Customer solely
for working capital in the ordinary  course of its business,  or, with the prior
written  consent of MLBFS,  for other lawful  business  purposes of Customer not
prohibited hereby. Customer agrees that under no circumstances will the proceeds
of the Loan or any  Subsequent  WCMA Loan be used:  (i) for personal,  family or
household purposes of any person whatsoever, or (ii) to purchase, carry or trade
in securities, or repay debt incurred to purchase, carry or trade in securities,
whether in or in connection  with the WCMA Account,  another account of Customer
with  MLPF&S  or an  account  of  Customer  at any  other  broker  or  dealer in
securities,  or (iii) unless otherwise  consented to in writing by MLBFS, to pay
any amount to Merrill Lynch and Co., Inc. or any of its subsidiaries, other than
Merrill  Lynch Bank USA,  Merrill  Lynch Bank & Trust Co. or any  subsidiary  of
either of them (including MLBFS and Merrill Lynch Credit Corporation).

                      ARTICLE III. THE WCMA LINE OF CREDIT

3.1  Activation of the WCMA Line of Credit.  Subject to the terms and conditions
hereof,  on the  Closing  Date  MLBFS  will  activate  a WCMA Line of Credit for
Customer  in the amount of the advance on account of the Loan made on such date.
Concurrently  with each  subsequent  advance on account of the Loan prior to the
Conversion Date, the Maximum WCMA Line of Credit will be increased by the amount
of such advance. All such advances will be funded out of the WCMA Line of Credit
immediately  after  such  activation  or  increase  (or,  if and  to the  extent
otherwise expressly  contemplated in the definition of Loan Purpose or otherwise
directed in the Advance Certificate and hereafter expressly agreed by MLBFS, all
or part of the Loan may be made available as a WCMA Line of Credit and funded by
Customer.)

3.2 Subsequent WCMA Loans.  Subject to the terms and conditions  hereof,  during
the period from and after the Closing Date to the Termination Date: (a) Customer
may repay the WCMA Loan Balance in whole or in part at any time without  premium
or penalty  (except,  as  hereafter  set forth,  upon a  refinancing  by another
lender),  and request a re-borrowing of amounts repaid on a revolving basis, and
(b) in  addition  to  Subsequent  WCMA Loans made  automatically  to pay accrued
interest,  as hereafter provided,  MLBFS will make such Subsequent WCMA Loans as
Customer  may from  time to time  request  or be  deemed  to have  requested  in
accordance with the terms hereof.  Customer may request Subsequent WCMA Loans by
use of WCMA Checks, FTS, Visa(R) charges, wire transfers, or such other means of
access  to the WCMA Line of Credit  as may be  permitted  by MLBFS  from time to
time;  it being  understood  that so long as the WCMA Line of Credit shall be in
effect,  any charge or debit to the WCMA Account  which but for the WCMA Line of
Credit would under the terms of the WCMA Agreement result in an overdraft, shall
be deemed a request by Customer for a Subsequent WCMA Loan.

3.3 Conditions of Subsequent WCMA Loans.  Notwithstanding  the foregoing,  MLBFS
shall not be obligated to make any Subsequent  WCMA Loan, and may without notice
refuse to honor any such request by Customer, if at the time of receipt by MLBFS
of Customer's  request:  (a) the making of such Subsequent WCMA Loan would cause
the  Maximum  WCMA Line of Credit,  as reduced  pursuant  to the  provisions  of
Section 3.6  hereof,  to be  exceeded;  or (b) the  Termination  Date shall have
occurred; or (c) an event shall have occurred and be continuing which shall have
caused any of the General Funding  Conditions to not then be met or satisfied to
the reasonable satisfaction of MLBFS. The making by MLBFS of any Subsequent WCMA
Loan (including, without limitation, the making of a Subsequent WCMA Loan to pay
accrued interest or late charges,  as hereafter provided) at a time when any one
or more of said  conditions  shall  not have  been met shall not in any event be
construed as a waiver of said  condition or  conditions  or of any Default,  and
shall not prevent MLBFS at any time  thereafter  while any  condition  shall not
have been met from  refusing to honor any request by Customer  for a  Subsequent
WCMA Loan.

3.4 WCMA Note.  Customer  hereby  promises to pay to the order of MLBFS,  at the
times  and in the  manner  set forth in this Loan  Agreement,  or in such  other
manner and at such place as MLBFS may  hereafter  designate in writing:  (a) the
WCMA Loan  Balance;  (b) interest at the Interest Rate on the  outstanding  WCMA
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Loan Balance  (computed  for the actual number of days elapsed on the basis of a
year  consisting  of 360 days),  from and  including the date on which the first
advance  on  account  of the Loan is made  until the date of payment of all WCMA
Loans in full; and (c) on demand,  all other sums payable  pursuant to this Loan
Agreement,  including, but not limited to, any late charges. Except as otherwise
expressly  set forth herein,  Customer  hereby  waives  presentment,  demand for
payment,  protest  and  notice  of  protest,  notice  of  dishonor,   notice  of
acceleration,  notice  of  intent  to  accelerate  and  all  other  notices  and
formalities in connection with this WCMA Note and this Loan Agreement.

3.5 Interest.  (a) An amount equal to accrued  interest on the WCMA Loan Balance
shall be payable by Customer monthly on each Interest Due Date,  commencing with
the Interest Due Date  occurring in the calendar month in which the Closing Date
shall occur. Unless otherwise hereafter directed in writing by MLBFS on or after
the Termination  Date, such interest will be  automatically  charged to the WCMA
Account on the  applicable  Interest Due Date,  and, to the extent not paid with
free credit  balances or the proceeds of sales of any Money Accounts then in the
WCMA Account, as hereafter provided,  such interest will be paid by a Subsequent
WCMA Loan and added to the WCMA Loan Balance. All interest shall be computed for
the actual number of days elapsed on the basis of a year consisting of 360 days.

(b)  Notwithstanding  any provision to the contrary in this  Agreement or any of
the  Additional  Agreements,  no  provision  of  this  Agreement  or  any of the
Additional  Agreements shall require the payment or permit the collection of any
amount in excess of the maximum  amount of interest  permitted  to be charged by
law  ("Excess  Interest").  If  any  Excess  Interest  is  provided  for,  or is
adjudicated  as being  provided for, in this  Agreement or any of the Additional
Agreements,  then:  (i)  Customer  shall  not be  obligated  to pay  any  Excess
Interest; and (ii) any Excess Interest that MLBFS may have received hereunder or
under any of the Additional  Agreements shall, at the option of MLBFS, be either
applied as a credit against the then WCMA Loan Balance, or refunded to the payer
thereof.

3.6 Periodic  Reduction of Maximum WCMA Line of Credit.  Commencing  on the last
Business Day of the first full calendar month following the Conversion Date, and
continuing  on the last Business Day of each  calendar  month  thereafter to and
including the last Business Day of the  fifty-ninth  (59th) such calendar month,
the  Maximum  WCMA  Line of  Credit  shall  be  reduced  by an  amount  equal to
one-sixtieth  (1/60th)  of the Loan  Amount per  month.  Unless the WCMA Line of
Credit shall have been earlier  terminated  pursuant to the terms hereof, on the
last Business Day of the sixtieth (60th) calendar month following the Conversion
Date,  the WCMA Line of Credit shall,  without  further  action of either of the
parties hereto, be terminated,  Customer shall pay to MLBFS the entire WCMA Loan
Balance, if any, and all other Obligations,  and the WCMA Account, at the option
of Customer,  will either be  converted  to a WCMA Cash Account  (subject to any
requirements of MLPF&S) or terminated.  No failure or delay on the part of MLBFS
in entering into the WCMA computer system any scheduled reduction in the Maximum
WCMA Line of Credit pursuant to this Section shall have the effect of preventing
or delaying such reduction.

3.7 Mandatory Payments.  CUSTOMER AGREES THAT IT WILL, WITHOUT DEMAND, INVOICING
OR THE REQUEST OF MLBFS,  FROM TIME TO TIME MAKE SUFFICIENT  PAYMENTS ON ACCOUNT
OF THE WCMA LOAN  BALANCE TO ASSURE THAT THE WCMA LOAN  BALANCE  WILL NOT AT ANY
TIME EXCEED THE MAXIMUM WCMA LINE OF CREDIT,  AS REDUCED EACH MONTH  PURSUANT TO
SECTION 3.6 HEREOF.

3.8 Method of Making  Payments.  All  payments  required or permitted to be made
pursuant  to this Loan  Agreement  shall be made in lawful  money of the  United
States.  Unless otherwise hereafter directed by MLBFS, such payments may be made
by the delivery of checks (other than WCMA  Checks),  or by means of FTS or wire
transfer of funds  (other than funds from the WCMA Line of Credit) to MLPF&S for
credit to the WCMA  Account.  Payments  to MLBFS from funds in the WCMA  Account
shall be deemed to be made by Customer upon the same basis and schedule as funds
are made available for  investment in the Money Accounts in accordance  with the
terms of the WCMA Agreement.  The acceptance by or on behalf of MLBFS of a check
or other payment for a lesser amount than shall be due from Customer, regardless
of any endorsement or statement thereon or transmitted  therewith,  shall not be
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deemed an accord and  satisfaction  or anything other than a payment on account,
and MLBFS or anyone  acting on behalf of MLBFS may  accept  such  check or other
payment without prejudice to the rights of MLBFS to recover the balance actually
due or to pursue any other remedy under this Loan  Agreement or  applicable  law
for such  balance.  All checks  accepted by or on behalf of MLBFS in  connection
with this Loan Agreement are subject to final collection.

3.9  Irrevocable  Instructions  to MLPF&S.  In order to  minimize  the WCMA Loan
Balance, Customer hereby irrevocably authorizes and directs MLPF&S, effective on
the Closing Date and continuing thereafter so long as this Agreement shall be in
effect: (a) to immediately and prior to application for any other purpose pay to
MLBFS to the  extent  of any WCMA  Loan  Balance  or other  amounts  payable  by
Customer  hereunder all available free credit  balances from time to time in the
WCMA Account; and (b) if such available free credit balances are insufficient to
pay the WCMA Loan  Balance  and such  other  amounts,  and there are in the WCMA
Account  at  any  time  any  investments  in  Money  Accounts  (other  than  any
investments  constituting  any Minimum  Money  Accounts  Balance  under the WCMA
Directed Reserve Program),  to immediately liquidate such investments and pay to
MLBFS to the  extent  of any  WCMA  Loan  Balance  and such  other  amounts  the
available proceeds from the liquidation of any such Money Accounts.

3.10 Late  Charge.  Any  payment  or  deposit  required  to be made by  Customer
pursuant to this Loan Agreement or any of the Additional  Agreements not paid or
made within ten (10) days of the  applicable due date shall be subject to a late
charge in an amount equal to the lesser of: (a) 5% of the overdue amount, or (b)
the maximum  amount  permitted  by  applicable  law.  Such late charge  shall be
payable on demand,  or, without  demand,  may in the sole discretion of MLBFS be
paid by a  Subsequent  WCMA Loan and added to the WCMA Loan  Balance in the same
manner as provided herein for accrued  interest with respect to the WCMA Line of
Credit,

3.11 Prepayment Customer may prepay the Loan and any Subsequent WCMA Loan at any
time in whole or in part without premium or penalty; provided, however, that any
refinancing of the WCMA Loan Balance by another financial institution shall: (a)
if such refinancing shall occur prior to the first anniversary of the Conversion
Date, be accompanied by a premium in an amount equal to 3% of the amount prepaid
by such refinancing;  (b) if such refinancing shall occur thereafter,  but prior
to the second anniversary of the Conversion Date, be accompanied by a premium in
an amount equal to 2% of the amount prepaid by such refinancing; and (c) if such
refinancing  shall occur on or at any time after the second  anniversary  of the
Conversion  Date,  be  accompanied  by a premium in an amount equal to 1% of the
amount prepaid by such refinancing.

3.12 Option of Customer to Terminate. Customer will have the option to terminate
the WCMA Line of Credit at any time upon written  notice to MLBFS.  Concurrently
with any such  termination,  Customer  shall pay to MLBFS the  entire  WCMA Loan
Balance and all other Obligations.

3.13 Limitation of Liability. MLBFS shall not be responsible,  and shall have no
liability to Customer or any other  party,  for any delay or failure of MLBFS to
honor any  request of  Customer  for a WCMA Loan or any other act or omission of
MLBFS,  MLPF&S or any of their  affiliates  due to or resulting  from any system
failure, error or delay in posting or other clerical error, loss of power, fire,
Act of God or other cause beyond the reasonable control of MLBFS,  MLPF&S or any
of their  affiliates  unless directly arising out of the willful wrongful act or
active gross  negligence of MLBFS. In no event shall MLBFS be liable to Customer
or any other party for any incidental or consequential  damages arising from any
act or omission by MLBFS,  MLPF&S or any of their  affiliates in connection with
the WCMA Line of Credit or this Loan Agreement.

3.14 Statements.  MLPF&S will include in each monthly  statement it issues under
the WCMA  Program  information  with  respect  to WCMA  Loans  and the WCMA Loan
Balance.  Any questions that Customer may have with respect to such  information
or the Loan should be directed to MLBFS;  and any questions  with respect to any
other matter in such statements or about or affecting the WCMA Program should be
directed to MLPF&S.
<PAGE>
                         ARTICLE IV. GENERAL PROVISIONS

4.1 Representations and Warranties.

Customer represents and warrants to MLBFS that:

(a)  Organization and Existence.  Customer is a corporation,  duly organized and
validly existing in good standing under the laws of the State of Delaware and is
qualified  to do  business  and in good  standing  in each other state where the
nature of its  business  or the  property  owned by it make  such  qualification
necessary;  and, where  applicable,  each Business  Guarantor is duly organized,
validly  existing  and in good  standing  under  the  laws of the  state  of its
formation  and is qualified  to do business  and in good  standing in each other
state  where the nature of its  business or the  property  owned by it make such
qualification necessary.

(b) Execution, Delivery and Performance. The execution, delivery and performance
by Customer of this Loan Agreement and by Customer and each Guarantor of such of
the Additional  Agreements to which it is a party: (i) have been duly authorized
by all requisite  action,  (ii) do not and will not violate or conflict with any
law or other governmental requirement, or any of the agreements,  instruments or
documents which formed or govern  Customer or any such  Guarantor,  and (iii) do
not and will not breach or violate any of the provisions of, and will not result
in a default by  Customer  or any such  Guarantor  under,  any other  agreement,
instrument  or document to which it is a party or by which it or its  properties
are bound.

(c) Notices and Approvals.  Except as may have been given or obtained, no notice
to or consent or approval of any  governmental  body or authority or other third
party whatsoever (including, without limitation, any other creditor) is required
in connection  with the  execution,  delivery or  performance by Customer or any
Guarantor of such of this Loan Agreement and the Additional  Agreements to which
it is a party.

(d) Enforceability. This Loan Agreement and such of the Additional Agreements to
which Customer or any Guarantor is a party are the respective  legal,  valid and
binding  obligations of Customer and such Guarantor,  enforceable  against it or
them, as the case may be, in accordance with their respective  terms,  except as
enforceability may be limited by bankruptcy and other similar laws affecting the
rights of creditors generally or by general principles of equity.

(e)  Collateral.  Except for any  Permitted  Liens:  (i)  Customer  has good and
marketable  title to the  Collateral,  (ii) none of the Collateral is subject to
any lien,  encumbrance  or security  interest,  and (iii) upon the filing of all
Uniform Commercial Code financing  statements  executed by Customer with respect
to the Collateral in the  appropriate  jurisdiction(s)  and/or the completion of
any other action  required by  applicable  law to perfect its liens and security
interests,  MLBFS  will  have  valid and  perfected  first  liens  and  security
interests upon all of the Collateral.

(f)  Financial  Statements.  Except as expressly  set forth in Customer's or any
Business Guarantor's financial statements,  all financial statements of Customer
and each Business Guarantor  furnished to MLBFS have been prepared in conformity
with generally accepted accounting  principles,  consistently  applied, are true
and correct in all material respects, and fairly present the financial condition
of it as at such dates and the results of its  operations  for the periods  then
ended (subject, in the case of interim unaudited financial statements, to normal
year-end adjustments);  and since the most recent date covered by such financial
statements,  there has been no  material  adverse  change in any such  financial
condition  or  operation.  All  financial  statements  furnished to MLBFS of any
Guarantor  other than a Business  Guarantor are true and correct in all material
respects and fairly represent such Guarantors financial condition as of the date
<PAGE>
of such financial  statements,  and since the most recent date of such financial
statements,  there  has  been no  material  adverse  change  in  such  financial
condition.

(g)  Litigation.  No litigation,  arbitration,  administrative  or  governmental
proceedings  are pending or, to the  knowledge of Customer,  threatened  against
Customer or any Guarantor, which would, if adversely determined,  materially and
adversely  affect the liens and security  interests of MLBFS  hereunder or under
any of the  Additional  Agreements,  the financial  condition of Customer or any
such  Guarantor  or  the  continued  operations  of  Customer  or  any  Business
Guarantor.

(h) Tax  Returns.  All  federal,  state  and  local  tax  returns,  reports  and
statements  required to be filed by Customer and each  Guarantor have been filed
with the  appropriate  governmental  agencies  and all taxes due and  payable by
Customer and each Guarantor have been timely paid (except to the extent that any
such failure to file or pay will not materially and adversely  affect either the
liens and security  interests of MLBFS  hereunder or under any of the Additional
Agreements,  the  financial  condition  of  Customer  or any  Guarantor,  or the
continued operations of Customer or any Business Guarantor).

(i) Collateral Location. All of the tangible Collateral is located at a Location
of Tangible Collateral.

(j) No Outside  Broker.  Except for  employees of MLBFS,  MLPF&S or one of their
affiliates,  Customer has not in connection with the  transactions  contemplated
hereby  directly or indirectly  engaged or dealt with, and was not introduced or
referred to MLBFS by, any broker or other loan arranger.

Each of the foregoing  representations and warranties:  (i) has been and will be
relied upon as an inducement to MLBFS to make the Loan and each  Subsequent WCMA
Loan,  and (ii) is  continuing  and shall be deemed  remade by  Customer  on the
Closing  Date, on the date of funding of each  additional  advance on account of
the Loan, on the Conversion Date, and concurrently with each request by Customer
for a Subsequent WCMA Loan.

4.2 Financial and Other Information.

(a) Customer  shall furnish or cause to be furnished to MLBFS during the term of
this Loan Agreement all of the following:

(i) Annual Financial Statements.  Within 120 days after the close of each fiscal
year of Customer, a copy of the annual audited consolidated financial statements
of Customer and the annual  audited  consolidated  financial  statements of each
Business  Guarantor,  including,  in each case, in reasonable  detail, a balance
sheet and statement of retained earnings as at the close of such fiscal year and
statements of profit and loss and cash flow for such fiscal year

(ii) Interim Financial Statements. Within 45 days after the close of each fiscal
quarter of Customer,  a copy of the interim financial statements of Customer and
each Business  Guarantor for such fiscal quarter (including in reasonable detail
both a balance  sheet as of the close of such fiscal  period,  and  statement of
profit and loss for the applicable fiscal period);

(iii) A/R  Agings.  Within 45 days  after the close of each  fiscal  quarter  of
Customer,  a copy of the Accounts  Receivable Aging of Customer as of the end of
such fiscal quarter; and

(iv) Other  Information.  Such other  information as MLBFS may from time to time
reasonably request relating to Customer, any Guarantor or the Collateral.

(b) General  Agreements With Respect to Financial  Information.  Customer agrees
that except as otherwise  specified  herein or otherwise agreed to in writing by
MLBFS: (i) all annual financial  statements required to be furnished by Customer
to  MLBFS  hereunder  will  be  prepared  by  either  the  current   independent
accountants for Customer or other independent  accountants reasonably acceptable
<PAGE>
to MLBFS, and (ii) all other financial  information  required to be furnished by
Customer  to MLBFS  hereunder  will be  certified  as  correct  in all  material
respects by the party who has  prepared  such  information,  and, in the case of
internally  prepared  information  with  respect  to  Customer  or any  Business
Guarantor, certified as correct by their respective chief financial officer.

4.3 Other Covenants.  Customer  further  covenants and agrees during the term of
this Loan Agreement that:

(a) Financial  Records;  Inspection.  Customer and each Business Guarantor will:
(i) maintain at its principal place of business  complete and accurate books and
records,  and maintain all of its financial  records in a manner consistent with
the financial statements heretofore furnished to MLBFS or prepared on such other
basis as may be approved in writing by MLBFS;  and (ii) permit MLBFS or its duly
authorized  representatives,  upon reasonable notice and at reasonable times, to
inspect its properties (both real and personal), operations, books and records.

(b) Taxes. Customer and each Guarantor will pay when due all taxes,  assessments
and other governmental charges,  howsoever designated, and all other liabilities
and  obligations,  except to the  extent  that any such  failure to pay will not
materially and adversely affect either the liens and security interests of MLBFS
hereunder or under any of the Additional Agreements,  the financial condition of
Customer  or any  Guarantor  or the  continued  operations  of  Customer  or any
Business Guarantor.

(c) Compliance With Laws and Agreements. Neither Customer nor any Guarantor will
violate any law, regulation or other governmental  requirement.  any judgment or
order of any  court or  governmental  agency  or  authority,  or any  agreement,
instrument  or document  to which it is a party or by which it is bound,  if any
such  violation  will  materially  and  adversely  affect  either  the liens and
security interests of MLBFS hereunder or under any of the Additional Agreements,
the  financial  condition  of  Customer  or  any  Guarantor,  or  the  continued
operations of Customer or any Business Guarantor.

(d) No Use of Merrill  Lynch Name.  Neither  Customer,  nor any  Guarantor  will
directly or indirectly publish,  disclose or otherwise use in any advertising or
promotional  material,  or press  release or  interview,  the name,  logo or any
trademark of MLBFS, MLPF&S,  Merrill Lynch and Co., Incorporated or any of their
affiliates.

(e)  Notification By Customer.  Customer shall provide MLBFS with prompt written
notification  of: (i) any Default;  (ii) any  materially  adverse  change in the
business,  financial  condition  or  operations  of  Customer  or  any  Business
Guarantor;  (iii) any information which indicates that any financial  statements
of Customer or any Guarantor fail in any material  respect to present fairly the
financial condition and results of operations  purported to be presented in such
statements;  and  (iv)  any  change  in  Customer's  outside  accountants.  Each
notification by Customer  pursuant hereto shall specify the event or information
causing such  notification,  and, to the extent  applicable,  shall  specify the
steps being taken to rectify or remedy such event or information.

(f)  Notice of  Change.  Customer  shall  give MLBFS not less than 30 days prior
written  notice of any change in the name  (including  any  fictitious  name) or
principal place of business or residence of Customer or any Guarantor.

(g) Continuity.  Except upon the prior written  consent of MLBFS,  which consent
wilt  not be  unreasonably  withheld:  (i)  neither  Customer  nor any  Business
Guarantor shall be a party to any merger or  consolidation  with, or purchase or
otherwise  acquire all or  substantially  all of the assets of, or any  material
stock,  partnership,  joint  venture or other equity  interest in, any person or
entity, or sell, transfer or lease all or any substantial part of its assets, if
any such action would result in either:  (A) a material  change in the principal
business,  ownership or control of Customer or such Business Guarantor, or (B) a
material adverse change in the financial  condition or operations of Customer or
<PAGE>
such  Business  Guarantor;  (ii)  Customer  and each  Business  Guarantor  shall
preserve their respective  existence and good standing in the jurisdiction(s) of
establishment and operation;  (iii) neither Customer nor any Business  Guarantor
shall  engage  in any  material  business  substantially  different  from  their
respective  business in effect as of the date of  application  by  Customer  for
credit from MLBFS, or cease operating any such material  business;  (iv) neither
Customer  nor any Business  Guarantor  shall cause or permit any other person or
entity to assume or succeed to any material  business or  operations of Customer
or such Business Guarantor;  and (v) neither Customer nor any Business Guarantor
shall cause or permit any material change in its controlling ownership.

(h) Minimum  Tangible Net Worth.  Customer's  "tangible  net worth" shall at all
times exceed  $1,600,000.00.  For the purposes  hereof,  the term  "tangible net
worth" shall mean Customer's net worth as shown on Customer's  regular financial
statements  prepared in a manner consistent with the terms hereof, but excluding
an  amount  equal  to  (i)  any  assets  which  are  ordinarily   classified  as
"intangible" in accordance with generally accepted  accounting  principles,  and
(ii) any amounts now or hereafter  directly or  indirectly  owing to Customer by
officers, shareholders or affiliates of Customer.

(i) Fixed Charge  Coverage  Ratio.  Customer  shall at all times during the term
hereof  maintain a Fixed Charge Coverage Ratio of not less than 3 to 1. The term
"Fixed  Charge  Coverage  Ratio"  shall  mean the ratio of:  (a)  income  before
interest  (including  payments in the nature of interest under capital  leases),
taxes,   depreciation  and  amortization,   less  internally   financed  capital
expenditures,  to (b) the sum  the  aggregate  principal  and  interest  paid or
accrued,  the  aggregate  rental  under  capital  leases  paid or  accrued,  any
dividends and other distributions paid or payable to shareholders and taxes paid
in cash;  all as determined on a quarterly  basis from the regular  consolidated
financial  statements of Customer prepared in a manner consistent with the terms
hereof.

4.4 Collateral

(a) Pledge of Collateral.  To secure payment and performance of the Obligations,
Customer hereby pledges,  assigns,  transfers and sets over to MLBFS, and grants
to MLBFS first liens and security  interests in and upon all of the  Collateral,
subject only to Permitted Liens.

(b) Liens.  Except upon the prior written  consent of MLBFS,  Customer shall not
create or permit to exist any lien,  encumbrance  or security  interest  upon or
with  respect  to any  Collateral  now owned or  hereafter  acquired  other than
Permitted Liens.

(c)  Performance of  Obligations.  Customer shall perform all of its obligations
owing on account of or with respect to the Collateral;  it being understood that
nothing herein, and no action or inaction by MLBFS, under this Loan Agreement or
otherwise,  shall be deemed an  assumption  by MLBFS of any of  Customer's  said
obligations.

(d) Sales and  Collections.  So long as no Event of Default  shall have occurred
and be continuing, Customer may in the ordinary course of its business: (i) sell
any  Inventory  normally  held by  Customer  for sale,  (ii) use or consume  any
materials  and supplies  normally held by Customer for use or  consumption,  and
(iii) collect all of its Accounts.  Customer shall take such action with respect
to protection of its Inventory and the other  Collateral  and the  collection of
its Accounts as MLBFS may from time to time reasonably request.

(e) Account Schedules.  Upon the request of MLBFS, made now or at any reasonable
time or times  hereafter,  Customer  shall deliver to MLBFS,  in addition to the
other information required hereunder,  a schedule identifying,  for each Account
and all Chattel  Paper  subject to MLBFS'  security  interests  hereunder,  each
Account  Debtor by name and address and amount,  invoice or contract  number and
date of each invoice or contract Customer shall furnish to MLBFS such additional
information with respect to the Collateral,  and amounts received by Customer as
proceeds  of any of the  Collateral,  as MLBFS may from time to time  reasonably
request.
<PAGE>
(f) Alterations and Maintenance. Except upon the prior written consent of MLBFS,
Customer  shall not make or permit  any  material  alterations  to any  tangible
Collateral which might materially  reduce or impair its market value or utility.
Customer  shall at all times keep the tangible  Collateral in good condition and
repair, reasonable wear and tear excepted, and shall pay or cause to be paid all
obligations arising from the repair and maintenance of such Collateral,  as well
as all obligations with respect to each Location of Tangible Collateral,  except
for  any  such  obligations  being  contested  by  Customer  in  good  faith  by
appropriate proceedings.

(g) Location. Except for movements required in the ordinary course of Customer's
business, Customer shall give MLBFS 30 days' prior written notice of the placing
at or movement of any tangible  Collateral to any location other than a Location
of Tangible Collateral.  In no event shall Customer cause or permit any material
tangible  Collateral  to be removed from the United  States  without the express
prior written consent of MLBFS.

(h)  Insurance.  Customer  shall insure all of the tangible  Collateral  under a
policy or policies of physical  damage  insurance  providing that losses will be
payable to MLBFS as its interests may appear pursuant to a Lender's Loss Payable
Endorsement and containing such other  provisions as may be reasonably  required
by MLBFS.  Customer  shall further  provide and maintain a policy or policies of
comprehensive  public  liability  Insurance  naming MLBFS as an additional party
insured.  Customer  and  each  Business  Guarantor  shall  maintain  such  other
insurance as may be required by law or is customarily maintained by companies in
a similar business or otherwise reasonably required by MLBFS. All such insurance
policies  shall  provide  that  MLBFS will  receive  not less than 10 days prior
written notice of any  cancellation,  and shall  otherwise be in form and amount
and with an insurer or insurers reasonably  acceptable to MLBFS.  Customer shall
furnish  MLBFS with a copy or  certificate  of each such policy or policies and,
prior to any expiration or cancellation, each renewal or replacement thereof.

(i) Event of Loss.  Customer shall at its expense promptly repair all repairable
damage to any tangible Collateral.  In the event that any tangible Collateral is
damaged  beyond repair,  lost,  totally  destroyed or confiscated  (an "Event of
Loss") and such Collateral had a value prior to such Event of Loss of $25,000.00
or more,  then,  on or  before  the  first to  occur  of (i) 90 days  after  the
occurrence  of such Event of Loss,  or (ii) 10  Business  Days after the date on
which  either  Customer or MLBFS  shall  receive any  proceeds of  insurance  on
account  of  such  Event  of  Loss,  or any  underwriter  of  insurance  on such
Collateral shall advise either Customer or MLBFS that it disclaims  liability in
respect of such Event of Loss,  Customer  shall,  at Customer's  option,  either
replace the Collateral subject to such Event of Loss with comparable  Collateral
free of all liens other than  Permitted  Liens (in which event Customer shall be
entitled to utilize the  proceeds of  insurance on account of such Event of Loss
for such  purpose,  and may retain any excess  proceeds of such  insurance),  or
permanently  prepay the Loan by an amount equal to the actual cash value of such
Collateral as determined  by either the  insurance  company's  payment (plus any
applicable   deductible)  or,  in  absence  of  insurance  company  payment,  as
reasonably  determined  by  MLBFS;  it being  further  understood  that any such
permanent  prepayment shall be accompanied by a like permanent  reduction in the
Maximum WCMA Line of Credit.  Notwithstanding  the foregoing,  if at the time of
occurrence of such Event of Loss or any time thereafter  prior to replacement or
line  reduction,  as  aforesaid,  an Event of Default shall have occurred and be
continuing hereunder, then MLBFS may at its sole option, exercisable at any time
while such Event of Default  shall be  continuing,  require  Customer  to either
replace such  Collateral  or prepay the Loan and reduce the Maximum WCMA Line of
Credit, as aforesaid.

(j) Notice of Certain Events.  Customer shall give MLBFS immediate notice of any
attachment,  lien, judicial process, encumbrance or claim affecting or involving
$25,000.00 or more of the Collateral.

(k)  Indemnification.  Customer shall indemnify,  defend and save MLBFS harmless
from and against any and all claims,  liabilities,  losses,  costs and  expenses
<PAGE>
(including, without limitation,  reasonable attorneys' fees and expenses) of any
nature whatsoever which may be asserted against or incurred by MLBFS arising out
of or in any manner occasioned by (i) the ownership, collection, possession, use
or operation of any  Collateral,  or (ii) any failure by Customer to perform any
of its obligations hereunder;  excluding,  however, from said indemnity any such
claims,  liabilities,  etc.  arising directly out of the willful wrongful act or
active gross negligence of MLBFS. This indemnity shall survive the expiration or
termination of this Loan  Agreement as to all matters  arising or accruing prior
to such expiration or termination.

4.5 Events of Default

The  occurrence  of any of the  following  events shall  constitute an "Event of
Default" under this Loan Agreement:

(a) Failure to Pay. (i) Customer  shall fail to deposit into the WCMA Account an
amount  sufficient  to assure  that the WCMA Loan  Balance  does not  exceed the
Maximum  WCMA Line of  Credit,  as  reduced In  accordance  with the  provisions
hereof,  or (ii)  Customer  shall  fail to pay to MLBFS a deposit  into the WCMA
Account  when due any other  amount owing or required to be paid or deposited by
Customer under this Loan Agreement, or (iii) Customer shall fail to pay when due
any other  Obligations;  and any such failure shall  continue for more than five
(5) Business Days after written notice thereof shall have been given by MLBFS to
Customer.

(b)  Failure  to  Perform.  Customer  or  any  Guarantor  shall  default  in the
performance  or  observance  of any  covenant  or  agreement  on its  part to be
performed  or  observed  under  this  Loan  Agreement  or any of the  Additional
Agreements (not  constituting an Event of Default under any other clause of this
Section),  and such default shall continue unremedied for ten (10) Business Days
after written notice thereof shall have been given by MLBFS to Customer.

(c) Breach of Warranty.  Any  representation or warranty made by Customer or any
Guarantor  contained  in this  Loan  Agreement  or any of the  other  Additional
Agreements  shall  at any time  prove to have  been  incorrect  in any  material
respect when made.

(d) Default Under Other Agreement.  A default or Event of Default by Customer or
any Guarantor shall occur under the terms of any other agreement,  instrument or
document  with or  intended  for the  benefit  of MLBFS,  MLPF&S or any of their
affiliates,  and any required notice shall have been given and required  passage
of time shall have elapsed.

(e) Bankruptcy Event. Any Bankruptcy Event shall occur.

(f) Material Impairment Any event shall occur which shall reasonably cause MLBFS
to in good faith  believe that the prospect of full  payment or  performance  by
Customer or any Guarantor of any of their respective  liabilities or obligations
under this Loan Agreement or any of the Additional  Agreements to which Customer
or such Guarantor is a party has been materially impaired. The existence of such
a material impairment shall be determined in a manner consistent with the intent
of Section 1208 of the UCC.

(g) Acceleration of Debt to Other Creditors. Any event shall occur which results
in the  acceleration of the maturity of any  indebtedness of $100.000.00 or more
of Customer or any Guarantor to another creditor under any indenture, agreement,
undertaking, or otherwise.

(h)  Seizure  or Abuse of  Collateral.  The  Collateral,  or any  material  part
thereof,  shall be or become  subject to any  material  abuse or misuse,  or any
levy, attachment,  seizure or confiscation which is not released within ten (10)
Business Days.
<PAGE>
4.6 Remedies.

(a) Remedies Upon Default. Upon the occurrence and during the continuance of any
Event of Default,  MLBFS may at its sole option do any one or more or all of the
following,  at such time and in such  order as MLBFS may in its sole  discretion
choose:

(i)  Termination.  MLBFS may without notice terminate its obligation to make any
further advances on account of the Loan (if any portion of the Loan has not then
been funded), terminate the WCMA Line of Credit, and terminate any obligation to
make any Subsequent WCMA Loan  (including,  without  limitation,  any Subsequent
WCMA Loan to pay accrued  interest) or otherwise extend any credit to or for the
benefit  of  Customer  (it  being  understood  that upon the  occurrence  of any
Bankruptcy  Event  the  WCMA  Line of  Credit  and all  such  obligations  shall
automatically  terminate without any action on the part of MLBFS);  and upon any
such termination MLBFS shall be relieved of all such obligations.

(ii)  Acceleration.  MLBFS  may  declare  the WCMA  Loan  Balance  and all other
Obligations to be forthwith due and payable, whereupon all such amounts shall be
immediately due and payable,  without presentment,  demand for payment,  protest
and notice of protest,  notice of dishonor,  notice of  acceleration,  notice of
intent to accelerate or other notice or formality of any kind,  all of which are
hereby  expressly  waived;  provided,  however,  that upon the occurrence of any
Bankruptcy Event the WCMA Loan Balance and other Obligations shall automatically
become due and payable without any action on the part of MLBFS.

(iii) Exercise Other Rights.  MLBFS may exercise any or all of the remedies of a
secured party under applicable law, including,  but not limited to, the UCC, and
any or all of its other rights and remedies  under this Loan  Agreement  and the
Additional Agreements.

(iv)  Possession.  MLBFS may  require  Customer to make the  Collateral  and the
records pertaining to the Collateral available to MLBFS at a place designated by
MLBFS which is reasonably  convenient to Customer, or may take possession of the
Collateral and the records  pertaining to the Collateral  without the use of any
judicial process and without any prior notice to Customer.

(v) Sale.  MLBFS may sell any or all of the Collateral at public or private sale
upon such terms and  conditions as MLBFS may reasonably  deem proper.  MLBFS may
purchase any  Collateral  at any such public sale.  The net proceeds of any such
public or private sale and all other amounts  actually  collected or received by
MLBFS pursuant  hereto,  after deducting all costs and expenses  incurred at any
time in the collection of the Obligations and in the protection,  collection and
sale of the Collateral, will be applied to the payment of the Obligations,  with
any remaining proceeds paid to Customer or whoever else may be entitled thereto,
and with Customer and each Guarantor  remaining jointly and severally liable for
any amount remaining unpaid after such application.

(vi) Delivery of Cash, Checks, Etc. MLBFS may require Customer to forthwith upon
receipt,  transmit and deliver to MLBFS in the form received,  all cash, checks,
drafts and other instruments for the payment of money (properly endorsed,  where
required, so that such items may be collected by MLBFS) which may be received by
Customer at any time in full or partial payment of any  Collateral,  and require
that  Customer not commingle any such items which may be so received by Customer
with any other of its funds or property but instead hold them separate and apart
and in trust for MLBFS until delivery is made to MLBFS.

(vii) Notification of Account Debtors.  MLBFS may notify any Account Debtor that
its Account or Chattel  Paper has been assigned to MLBFS and direct such Account
Debtor to make payment directly to MLBFS of all amounts due or becoming due with
respect to such  Account or Chattel  Paper;  and MLBFS may  enforce  payment and
collect, by legal proceedings or otherwise, such Account or Chattel Paper,

(viii)  Control of  Collateral.  MLBFS may otherwise  take control in any lawful
manner of any cash or non-cash items of payment or proceeds of Collateral and of
any rejected,  returned, stopped in transit or repossessed goods included in the
Collateral and endorse  Customer's name on any item of payment on or proceeds of
the Collateral,
<PAGE>
(b) Set-Off.  MLBFS shall have the further right upon the  occurrence and during
the continuance of an Event of Default to set-off,  appropriate and apply toward
payment of any of the  Obligations,  in such order of  application  as MLBFS may
from time to time and at any time elect, any cash, credit,  deposits,  accounts,
financial  assets,  investment  property,  securities  and any other property of
Customer  which is in  transit  to or in the  possession,  custody or control of
MLBFS,  MLPF&S or any agent,  bailee, or affiliate of MLBFS or MLPF&S.  Customer
hereby  collaterally  assigns and grants to MLBFS a continuing security interest
in all such property as additional Collateral.

(c) Power of Attorney.  Effective upon the occurrence and during the continuance
of an  Event of  Default,  Customer  hereby  irrevocably  appoints  MLBFS as its
attorney-in-fact, with full power of substitution, in its place and stead and in
its name or in the name of MLBFS, to from time to time in MLBFS' sole discretion
take any action and to execute any instrument  which MLBFS may deem necessary or
advisable to accomplish the purposes of this Loan Agreement,  including, but not
limited  to, to  receive,  endorse  and  collect  all  checks,  drafts and other
instruments  for the payment of money made  payable to Customer  included in the
Collateral.

(d)  Remedies are  Severable  and  Cumulative.  All rights and remedies of MLBFS
herein are  severable  and  cumulative  and in addition to all other  rights and
remedies  available in the Additional  Agreements,  at law or in equity, and any
one or more of such  rights and  remedies  may be  exercised  simultaneously  or
successively.

(e) Notices.  To the fullest extent permitted by applicable law, Customer hereby
irrevocably  waives and releases MLBFS of and from any and all  liabilities  and
penalties for failure of MLBFS to comply with any statutory or other requirement
imposed upon MLBFS relating to notices of sale,  holding of sale or reporting of
any sale, and Customer waives all rights of redemption a reinstatement  from any
such sale.  Any notices  required  under  applicable law shall be reasonably and
properly  given to Customer if given by any of the  methods  provided  herein at
least 5 Business  Days  prior to taking  action.  MLBFS  shall have the right to
postpone  or adjourn any sale or other  disposition  of  Collateral  at any time
without  giving  notice of any such  postponed or adjourned  date.  In the event
MLBFS seeks to take possession of any or all of the Collateral by court process,
Customer further  irrevocably  waives to the fullest extent permitted by law any
bonds and any surety or security relating thereto required by any statute, court
rule or  otherwise  as an  incident  to such  possession,  and  any  demand  for
possession prior to the commencement of any suit or action.

4.7 Miscellaneous.

(a)  Non-Waiver.  No  failure  or delay on the part of MLBFS in  exercising  any
right,  power or remedy pursuant to this Loan Agreement or any of the Additional
Agreements shall operate as a waiver thereof,  and no single or partial exercise
of any such right,  power or remedy shall preclude any other or further exercise
thereof, or the exercise of any other right, power or remedy. Neither any waiver
of any provision of this Loan Agreement or any of the Additional Agreements, nor
any consent to any departure by Customer  therefrom,  shall be effective  unless
the same shall be in writing and signed by MLBFS. Any waiver of any provision of
this Loan Agreement or any of the  Additional  Agreements and any consent to any
departure by Customer  from the terms  thereof  shall be  effective  only in the
specific  instance  and for the  specific  purpose  for which  given.  Except as
otherwise expressly provided herein, no notice to or demand on Customer shall in
any case entitle Customer to any other or further notice or demand in similar or
other circumstances.

(b) Disclosure.  Customer hereby  irrevocably  authorizes  MLBFS and each of its
affiliates,  including without limitation MLPF&S, to at any time (whether or not
an Event of Default shall have occurred)  obtain from and disclose to each other
any and all financial and other information about Customer.
<PAGE>
(c) Communications.  All notices and other communications  required or permitted
hereunder or in connection  with any of the  Additional  Agreements  shall be in
writing,  and shall be either  delivered  personally,  mailed by postage prepaid
certified  mail or sent by  express  overnight  courier  or by  facsimile.  Such
notices and  communications  shall be deemed to be given on the date of personal
delivery,  facsimile  transmission  or actual delivery of certified mail, or one
Business Day after delivery to an express  overnight  courier.  Unless otherwise
specified  in a notice sent or delivered in  accordance  with the terms  hereof,
notices and other communications in writing shall be given to the parties hereto
at their respective addresses set forth at the beginning of this Loan Agreement,
or, in the case of facsimile  transmission,  to the parties at their  respective
regular facsimile telephone number.

(d) Fees, Expenses and Taxes. Customer shall pay or reimburse MLBFS for: (i) all
Uniform Commercial Code filing and search fees and expenses incurred by MLBFS in
connection  with the  verification,  perfection or preservation of MLBFS' rights
hereunder or in the Collateral or any other collateral for the Obligations; (ii)
any and all stamp, transfer and other taxes and fees payable or determined to be
payable in connection with the execution, delivery and/or recording of this Loan
Agreement or any of the Additional Agreements; and (iii) all reasonable fees and
out-of-pocket  expenses  (including,  but not  limited to,  reasonable  fees and
expenses of outside counsel) incurred by MLBFS in connection with the collection
of any sum payable hereunder or under any of the Additional  Agreements not paid
when due,  the  enforcement  of this  Loan  Agreement  or any of the  Additional
Agreements  and  the  protection  of  MLBFS'  rights  hereunder  or  thereunder,
excluding,   however,  salaries  and  normal  overhead  attributable  to  MLBFS'
employees.  Customer hereby authorizes MLBFS, at its option, to either cause any
and all such fees,  expenses  and taxes to be paid with a WCMA Loan,  or invoice
Customer therefor (in which event Customer shall pay all such fees, expenses and
taxes within 5 Business Days after receipt of such invoice).  The obligations of
Customer  under this  paragraph  shall survive the  expiration or termination of
this Loan Agreement and the discharge of the other Obligations.

(e) Right to Perform Obligations.  If Customer shall fail to do any act or thing
which it has covenanted to do under this Loan Agreement or any representation or
warranty  on the part of  Customer  contained  in this Loan  Agreement  shall be
breached,  MLBFS may,  in its sole  discretion,  after 5 Business  Days  written
notice is sent to Customer (or such lesser  notice,  including no notice,  as is
reasonable  under  the  circumstances),  do the  same or  cause it to be done or
remedy any such breach,  and may expend its funds for such purpose.  Any and all
reasonable  amounts so expended by MLBFS shall be repayable to MLBFS by Customer
upon  demand,  with  interest  at the  Interest  Rate during the period from and
including the date funds are so expended by MLBFS to the date of repayment,  and
all such amounts shall be additional Obligations.  The payment or performance by
MLBFS of any of Customer's  obligations  hereunder shall not relieve Customer of
said  obligations or of the  consequences of having failed to pay or perform the
same, and shall not waive or be deemed a cure of any Default.

(f) Further  Assurances.  Customer agrees to do such further acts and things and
to execute  and deliver to MLBFS such  additional  agreements,  instruments  and
documents as MLBFS may  reasonably  require or deem  advisable to effectuate the
purposes  of this Loan  Agreement  or any of the  Additional  Agreements,  or to
establish,  perfect and maintain  MLBFS'  security  interests and liens upon the
Collateral, including, but not limited to: (i) executing financing statements or
amendments thereto when and as reasonably requested by MLBFS; and (ii) if in the
reasonable  judgment of MLBFS it is  required  by local law,  causing the owners
and/or mortgagees of the real property on which any Collateral may be located to
execute and deliver to MLBFS waivers or subordinations  reasonably  satisfactory
to MLBFS with respect to any fights in such Collateral.

(g) Binding Effect.  This Loan Agreement and the Additional  Agreements shall be
binding  upon,  and shall  inure to the  benefit  of MLBFS,  Customer  and their
respective  successors and assigns.  Customer shall not assign any of its rights
or  delegate  any of its  obligations  under this Loan  Agreement  or any of the
Additional  Agreements  without  the prior  written  consent  of  MLBFS.  Unless
<PAGE>
otherwise  expressly  agreed to in a writing  signed by MLBFS,  no such  consent
shall in any event relieve  Customer of any of its  obligations  under this Loan
Agreement or any of the Additional Agreements.

(h) Headings. Captions and section and paragraph headings in this Loan Agreement
are  inserted  only as a  matter  of  convenience,  and  shall  not  affect  the
interpretation hereof.

(i) Governing Law. This Loan Agreement and, unless otherwise  expressly provided
therein, each of the Additional Agreements, shall be governed in all respects by
the laws of the State of Illinois.

(j) Severability of Provisions.  Whenever possible,  each provision of this Loan
Agreement and the Additional  Agreements  shall be interpreted in such manner as
to be  effective  and valid under  applicable  law.  Any  provision of this Loan
Agreement  or  any  of  the  Additional   Agreements   which  is  prohibited  or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
only to the extent of such prohibition or unenforceability  without invalidating
the remaining provisions of this Loan Agreement and the Additional Agreements or
affecting  the  validity  or  enforceability  of  such  provision  m  any  other
jurisdiction.

(k) Term.  This Loan  Agreement  shall become  effective on the date accepted by
MLBFS at its office in  Chicago,  Illinois,  and,  subject to the terms  hereof,
shall continue in effect so long  thereafter as: (i) MLBFS shall be obligated to
make the Loan,  (ii) the WCMA Line of Credit  shall be in  effect,  (iii)  there
shall be any moneys  outstanding under this Loan Agreement,  or (iv) there shall
be any other Obligations outstanding.

(I)  Counterparts.   This  Loan  Agreement  may  be  executed  in  one  or  more
counterparts which, when taken together, constitute one and the same agreement.

(m)  Jurisdiction;  Waiver.  CUSTOMER  ACKNOWLEDGES  THAT THIS LOAN AGREEMENT IS
BEING ACCEPTED BY MLBFS IN PARTIAL  CONSIDERATION OF MLBFS' RIGHT AND OPTION, IN
ITS  SOLE  DISCRETION,  TO  ENFORCE  THIS  LOAN  AGREEMENT  AND  THE  ADDITIONAL
AGREEMENTS  IN EITHER THE STATE OF ILLINOIS OR IN ANY OTHER  JURISDICTION  WHERE
CUSTOMER  OR  ANY  COLLATERAL  FOR  THE  OBLIGATIONS  MAY BE  LOCATED.  CUSTOMER
IRREVOCABLY SUBMITS ITSELF TO JURISDICTION IN THE STATE OF ILLINOIS AND VENUE IN
ANY STATE OR FEDERAL COURT IN THE COUNTY OF COOK FOR SUCH PURPOSES, AND CUSTOMER
WAIVES  ANY AND ALL  RIGHTS  TO  CONTEST  SAID  JURISDICTION  AND  VENUE AND THE
CONVENIENCE OF ANY SUCH FORUM, AND ANY AND ALL RIGHTS TO REMOVE SUCH ACTION FROM
STATE TO FEDERAL  COURT.  CUSTOMER  FURTHER  WAIVES ANY RIGHTS TO  COMMENCE  ANY
ACTION AGAINST MLBFS IN ANY JURISDICTION  EXCEPT IN THE COUNTY OF COOK AND STATE
OF ILLINOIS.  MLBFS AND CUSTOMER  HEREBY EACH EXPRESSLY WAIVE ANY AND ALL RIGHTS
TO A TRIAL BY JURY IN ANY ACTION,  PROCEEDING OR COUNTERCLAIM  BROUGHT BY EITHER
OF THE PARTIES  AGAINST THE OTHER PARTY WITH RESPECT TO ANY MATTER  RELATING T0,
ARISING OUT OF OR IN ANY WAY CONNECTED WITH THE LOAN, THIS LOAN  AGREEMENT,  ANY
ADDITIONAL  AGREEMENTS  AND/OR  ANY OF THE  TRANSACTIONS  WHICH ARE THE  SUBJECT
MATTER OF THIS LOAN  AGREEMENT.  CUSTOMER  FURTHER WAIVES THE RIGHT TO BRING ANY
NON-COMPULSORY COUNTERCLAIMS.

(n) Integration.  THIS LOAN AGREEMENT,  TOGETHER WITH THE ADDITIONAL AGREEMENTS,
CONSTITUTES THE ENTIRE UNDERSTANDING AND REPRESENTS THE FULL AND FINAL AGREEMENT
BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT  MATTER  HEREOF,  AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR WRITTEN  AGREEMENTS OR PRIOR,  CONTEMPORANEOUS
OR  SUBSEQUENT  ORAL  AGREEMENTS  OF THE PARTIES.  THERE ARE NO  UNWRITTEN  ORAL
AGREEMENTS OF THE PARTIES. WITHOUT LIMITING THE FOREGOING, CUSTOMER ACKNOWLEDGES
THAT: (I) NO PROMISE OR COMMITMENT  HAS BEEN MADE TO IT BY MLBFS,  MLPF&S OR ANY
OF THEIR RESPECTIVE EMPLOYEES, AGENTS OR REPRESENTATIVES TO MAKE THE LOAN OR ANY
SUBSEQUENT  WCMA LOAN ON ANY TERMS OTHER THAN AS EXPRESSLY SET FORTH HEREIN,  OR
TO MAKE ANY OTHER LOAN OR  OTHERWISE  EXTEND ANY OTHER CREDIT TO CUSTOMER OR ANY
OTHER PARTY; AND (II) EXCEPT AS OTHERWISE  EXPRESSLY PROVIDED HEREIN,  THIS LOAN
AGREEMENT  SUPERSEDES AND REPLACES ANY AND ALL PROPOSALS,  LETTERS OF INTENT AND
APPROVAL AND COMMITMENT  LETTERS FROM MLBFS TO CUSTOMER,  NONE OF WHICH SHALL BE
CONSIDERED  AN  ADDITIONAL  AGREEMENT.  NO  AMENDMENT  OR  MODIFICATION  OF THIS
AGREEMENT OR ANY OF THE ADDITIONAL AGREEMENTS TO WHICH CUSTOMER IS A PARTY SHALL
BE EFFECTIVE UNLESS IN A WRITING SIGNED BY BOTH MLBFS AND CUSTOMER.
<PAGE>
IN WITNESS WHEREOF, this Loan Agreement has been executed as of the day and year
first above written.

RENT-A-WRECK OF AMERICA, INC. D/B/A "RENT-A-WRECK" AND "PRICELESS"

By: /s/ Ken Blum, Jr.                      By: /s/ Mitra Ghahramanlou
    ----------------------------               ----------------------------
    Signature (1)                              Signature (2)

    Ken Blum, Jr.                              Mitra Ghahramanlou
    ----------------------------               ----------------------------
    Printed Name                               Printed Name

    President                                  CAO
    ----------------------------               ----------------------------
    Title                                      Title

Accepted at Chicago, Illinois:
MERRILL LYNCH BUSINESS
FINANCIAL SERVICES INC.

By: /s/
    ----------------------------
<PAGE>
                                    EXHIBIT A

ATTACHED TO AND HEREBY MADE A PART OF WCMA  REDUCING  REVOLVER LOAN AND SECURITY
AGREEMENT NO. 7WD-07018 BETWEEN MERRILL LYNCH BUSINESS  FINANCIAL  SERVICES INC.
AND RENT-A-WRECK OF AMERICA, INC. D/B/A "RENT-A-WRECK" AND "PRICELESS"

Additional Locations of Tangible Collateral:Exhibit 10.55

                                  RENT A WRECK

March 7, 2002

Mr. Ted Demetriou
Demetriou Insurance Services
1250 Marywood Drive
Belair, MD  21014

Sent via Federal Express #8257 6979 55111

Re: Letter of Agreement

Dear Ted:

The following letter of agreement between  Rent-A-Wreck of America,  Inc. (RAWA)
and Demetriou Insurance Services (DIS) is to be effective as of March 1, 2002. A
self-addressed  and stamped  envelope is enclosed for your  convenience.  Please
sign and return for our records.

     *    Demetrio Insurance Services will manage the captive, Consolidated
          American Rental Insurance Company, LTD, regarding processing of
          renewals, adding new accounts, issuing COI's and ID cards, monitoring
          claims experience, and acting as underwriter and actuary.

     *    DIS will attend meetings, seminars, conventions and classes, at the
          direction and discretion of RAWA.

     *    DIS will submit applications to other markets that may come available
          for non-captive states, pertaining to all non-physical damage
          coverages. If possible and with expected profitability, physical
          damage will be offered through the captive.

     *    DIS will continue to solicit markets for excess coverage with the
          intent of brining this under the new joint venture as well.

     *    First year compensation to DIS will be $6,000 per month, payable
          monthly, with annual adjustments based on growth. At no time will the
          monthly fee be less than $6,000.

     *    Ongoing expenses will be borne by mutual agreement, some by DIS, some
          by RAWA and some by the new joint venture.

     *    RAWA will pay for Ted Demetriou and the new joint venture to become
          licensed in all states as soon as possible.

     *    This agreement will have a minimum term of three years.
<PAGE>
     *    All commissions generated from all other sources will be split 75% to
          RAWA and 25% to DIS, subject to an annual review.

     *    It's agreed that all business generated from the car rental
          marketplace will be placed through this joint venture.

     *    DIS agrees not to compete with the captive, and not to solicit
          business from customers within this program after the expiration and
          termination of this agreement.

     *    All disputes arising out of this agreement will be resolved by
          arbitration before the American Arbitration Association. Arbitration
          Hearings will be held in Baltimore, Maryland.

Sincerely,

Kenneth L. Blum, Jr.
President

KLB/rld

cc: Mitra Ghahramanlou

AGREED TO: /s/ Ted Demetriou                         3/8/02
           ------------------------------          --------
           Ted Demetriou

AGREED TO: /s/ Kenneth L. Blum, Jr.                 3/18/02
           ------------------------------          --------
           Kenneth L. Blum, Jr.
           President, RAWA

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