Document:

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                                                            Exhibit 4.8

                              SEGUE SOFTWARE, INC.

           Third Amendment to 1996 Amended and Restated Incentive and
                        Non-Qualified Stock Option Plan

A.   The following Third Amendment to the 1996 Amended and Restated Incentive
and Non-Qualified Stock Option Plan (the "Plan") of Segue Software, Inc. (the
"Company"), as first amended by vote of the Board of Directors on February 7,
1997 and the shareholders of the Company at the Annual Meeting of Stockholders
of the Company on May 2, 1997, was adopted by the Board of Directors of the
Company, with respect to paragraphs 1, 3 and 4, on March 22, 2000, and with
respect to paragraphs 2 and 5 on June 23, 2000 and was submitted to and approved
by the stockholders of the Company at the 2000 Annual Meeting of Stockholders
held on June 23, 2000.  Capitalized terms used herein and not otherwise defined
shall have the meaning provided in the Plan.

     1.   Paragraph 3 of the Plan is hereby amended by deleting said Paragraph
in its entirety and substituting therefor the following:

     "3.  SHARES SUBJECT TO THE PLAN.
          --------------------------

          The number of Shares reserved and available for issuance under the
     Plan shall be increased from 3,250,000 to 3,700,000.  Further, as of each
     of January 1, 2001 and January 1, 2002, an additional positive number equal
     to five percent (5%) of the number of shares of Common Stock of the Company
     outstanding as of each such dates, respectively, shall be added to the
     reserved Shares under the Plan.  The foregoing number of Shares shall be
     subject to adjustment by the Administrator in accordance with Paragraph 16
     of the Plan.

          For purposes of this Paragraph 3, the Shares underlying any Options
     which are forfeited, canceled, reacquired by the Company, satisfied without
     the issuance of Common Stock or otherwise terminated (other than by
     exercise) shall be added back to the Shares available for issuance under
     the Plan."

     2.   Paragraph 6(A) of the Plan is hereby amended by deleting subparagraph
(a) thereof and substituting therefor the following:

               "(a)  Option Price:  The option price (per share) of the Shares
     covered by each Option shall be determined by the Administrator but shall
     not be less than the Fair Market Value per share of Common Stock."

     3.   Paragraph 6(B) of the Plan is hereby amended by deleting subparagraph
(d) in its entirety and substituting therefor the following:

               "(d) Limitation on Grant of ISOs: No ISOs shall be granted (i)
     from the 2,450,000 Shares authorized on February 12, 1996 after February
     12, 2006, (ii) from the 550,000 Shares authorized by the amendment to the
     Plan adopted by the Board of Directors on February 7, 1997 and approved by
     the shareholders of the Company on May 2, 1997 after February 7, 2007,
     (iii) from the 250,000 Shares authorized by the amendment to the Plan
     adopted by the Board of Directors on February 25, 1998 and approved by the
     shareholders of the Company on June 5, 1998 after February 25, 2008, and
     (iv) from the Shares added to the Plan by this Second Amendment, on March
     22, 2010."

     4.   Paragraph 22 of the Plan is hereby amended by deleting said Paragraph
in its entirety and substituting therefor the following:

     "22.  TERMINATION OF THE PLAN.
           -----------------------
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          The Plan will terminate on March 22, 2010.  The Plan may be terminated
     at an earlier date by vote of the shareholders of the Company; provided,
     however, that any such earlier termination will not affect any Options
     granted or Option Agreements executed prior to the effective date of such
     termination."

     5.   Paragraph 23 of the Plan is hereby amended by deleting said Paragraph
in its entirety and substituting therefor the following:

     "23.  AMENDMENT OF THE PLAN AND AGREEMENTS.
           ------------------------------------

          The Plan may be amended by the shareholders of the Company.  The Plan
     may also be amended by the Administrator, including, without limitation, to
     the extent necessary to qualify any or all outstanding Options granted
     under the Plan or Options to be granted under the Plan for favorable
     federal income tax treatment (including deferral of taxation upon exercise)
     as may be afforded incentive stock options under Section 422 of the Code,
     to the extent necessary to ensure the qualification of the Plan under Rule
     16b-3, at such time, if any, as the Company has a class of stock registered
     pursuant to Section 12 of the 1934 Act, and to the extent necessary to
     qualify the shares issuable upon exercise of any outstanding Options
     granted, or Options to be granted, under the Plan for listing on any
     national securities exchange or quotation in any national automated
     quotation system of securities dealers.  Notwithstanding the preceding
     sentence, any amendment approved by the Administrator which (i) is
     material, or (ii) is of a scope that requires shareholder approval in order
     to ensure favorable federal income tax treatment for any incentive stock
     options or requires shareholder approval in order to ensure the compliance
     of the Plan with Rule 16b-3 at such time, if any, as the Company has a
     class of stock registered pursuant to Section 12 of the 1934 Act, shall be
     subject to obtaining such shareholder approval.  Any modification or
     amendment of the Plan shall not, without the consent of a Participant,
     adversely affect his or her rights under an Option previously granted to
     him or her.  With the consent of the Participant affected, the
     Administrator may amend outstanding Option Agreements in a manner which may
     be adverse to the Participant but which is not inconsistent with the Plan.
     In the discretion of the Administrator, outstanding Option Agreements may
     be amended by the Administrator in a manner which is not adverse to the
     Participant."

B.   Except as expressly amended hereby, the Plan remains in full force and
effect in accordance with its terms.<PAGE>

                                                            Exhibit 4.9

                    SECOND AMENDMENT TO SEGUE SOFTWARE, INC.
                       1996 EMPLOYEE STOCK PURCHASE PLAN

A.   The SEGUE SOFTWARE, INC. 1996 EMPLOYEE STOCK PURCHASE PLAN (the "Plan"), is
     hereby amended:

     1    In Section 12 by deleting the entire subparagraph (a) and inserting in
place thereof the following subparagraph::

               "(a)   The maximum number of shares of the Company's Common Stock
     which shall be made available for sale under the Plan shall be 300,000
     shares, subject to adjustment upon changes in capitalization of the Company
     as provided in paragraph 18.  If the total number of shares which would
     otherwise be subject to options granted pursuant to Section 7(a) hereof on
     the Offering Date of an Offering Period exceeds the number of shares then
     available under the Plan (after deduction of all shares for which options
     have been exercised or are then outstanding), the Company shall make a pro
     rata allocation of the shares remaining available for option grant in as
     uniform a manner as shall be practicable and as it shall determine to be
     equitable.  Any amounts remaining in an Employee's account not applied to
     the purchase of stock pursuant to this Section 12 shall be refunded on or
     promptly after the Exercise Date.  In such event, the Company shall give
     written notice of such reduction of the number of shares subject to the
     option to each Employee affected thereby and shall similarly reduce the
     rate of Contributions, if necessary."

     2    In Section 24 by deleting the entire paragraph and inserting in place
thereof the following paragraph:

     "24. Term of Plan.  The Plan became effective upon its adoption by the
          ------------
Board of Directors in February 1996 and was subsequently amended (i) upon
approval of the Board in February 1998 and the stockholders of the Company in
June 1998 and (ii) upon approval of the Board in March 2000 and the stockholders
of the Company in June 2000.  The Plan shall continue in effect for a term of
twenty years from the most recent amendment unless sooner terminated under
paragraph 19."

B.   The effective date of this Second Amendment shall be June 23, 2000.

C.   Except as expressly amended hereby, the Plan remains in full force and
     effect in accordance with its terms.BUSINESS LOAN AGREEMENT

Borrower:  BIOANALYTICAL SYSTEMS, INC.        Lender:  Bank One, Indiana, NA
           2701 KENT AVENUE                            Commercial Loan Corp.
           WEST LAFAYETTE, IN 47906                    111 Monument Circle
                                                       Indianapolis, IN 46277

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THIS BUSINESS LOAN AGREEMENT between  BIOANALYTICAL  SYSTEMS,  INC. ("Borrower")
and Bank One,  Indiana,  NA ("Lender") is made and executed as of April 1, 2000.
This  Agreement  governs all loans,  credit  facilities  and/or other  financial
accommodations  described  herein and, unless  otherwise agreed to in writing by
Lender and Borrower,  all other present and future loans,  credit facilities and
other financial  accommodations  provided by Lender to Borrower. All such loans,
credit  facilities  and  other  financial  accommodations,   together  with  all
renewals,  amendments  and  modifications  thereof,  are  referred  to  in  this
Agreement  individually as the "Loan" and collectively as the "Loans."  Borrower
understands and agrees that: (a) in granting,  renewing,  or extending any Loan,
Lender is relying upon Borrower's  representations,  warranties, and agreements,
as set forth in this Agreement; and (b) all such Loans shall be and shall remain
subject to the following terms and conditions of this Agreement.

TERM.  This Agreement shall be effective as of April 1, 2000, and shall continue
thereafter  until all Loans and other  obligations  owing by  Borrower to Lender
hereunder have been paid in full and Lender has no commitments or obligations to
make further advances under the Loans to Borrower.

DEFINITIONS.  The following words shall have the following meanings when used in
this  Agreement.  Terms not otherwise  defined in this Agreement  shall have the
meanings  attributed to such terms in the Uniform  Commercial Code as adopted in
the State of Indiana.  All  references  to dollar  amounts shall mean amounts in
lawful money of the United States of America.

          Agreement. The word "Agreement" means this Business Loan Agreement, as
          may be  amended  or  modified  from  time to time,  together  with all
          exhibits and schedules attached hereto from time to time.

          Borrower. The word "Borrower" means BIOANALYTICAL SYSTEMS, INC.

          Collateral.   The  word   "Collateral"   means  and  includes  without
          limitation all property and assets granted as collateral for any Loan,
          whether  real  or  personal  property,  whether  granted  directly  or
          indirectly,  whether granted now or in the future, and whether granted
          in  the  form  of  a  security  interest,  mortgage,  deed  of  trust,
          assignment,  pledge,  chattel mortgage,  chattel trust, factor's lien,
          equipment trust,  conditional sale, trust receipt,  lien, charge, lien
          or title  retention  contract,  lease  or  consignment  intended  as a
          security  device,  or any other security or lien interest  whatsoever,
          whether created by law, contract, or otherwise.

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          ERISA. The word "ERISA" means the Employee  Retirement Income Security
          Act of 1974, as amended.

          Grantor.  The word  "Grantor"  means and includes  each and all of the
          persons or entities granting a Security Interest in any Collateral for
          any of the Loans.

          Guarantor. The word "Guarantor" means and includes each and all of the
          guarantors, sureties, and accommodation parties for any of the Loans.

          Indebtedness. The word "Indebtedness" means the indebtedness evidenced
          by the Note,  including all principal  and accrued  interest  thereon,
          together  with all other  liabilities,  costs and  expenses  for which
          Borrower  is  responsible  under  this  Agreement  or under any of the
          Related Documents.  In addition, the word "Indebtedness"  includes all
          other  obligations,  debts and liabilities,  plus any accrued interest
          thereon,  owing by Borrower,  or any one or more of them, to Lender of
          any kind or character,  now existing or hereafter arising,  as well as
          all present and future claims by Lender against  Borrower,  or any one
          or  more  of  them,  and  all  renewals,  extensions,   modifications,
          substitutions and rearrangements of any of the foregoing; whether such
          Indebtedness arises by note, draft, acceptance, guaranty, endorsement,
          letter  of  credit,  assignment,  overdraft,  indemnity  agreement  or
          otherwise;  whether such Indebtedness is voluntary or involuntary, due
          or not due, direct of indirect, absolute or contingent,  liquidated or
          unliquidated;  whether Borrower may be liable  individually or jointly
          with others;  whether  Borrower may be liable primarily or secondarily
          or as debtor, maker, comaker,  drawer,  endorser,  guarantor,  surety,
          accommodation party or otherwise.

          Lender. The word "Lender" means Bank One, Indiana,  NA, its successors
          and assigns.

          Note. The word "Note" means any and all promissory note or notes which
          evidence  Borrower's  Loans  in  favor  of  Lender,  as  well  as  any
          amendment, modification, renewal or replacement thereof.

          Permitted  Liens.  The words  "Permitted  Liens"  mean:  (a) liens and
          security interests  securing  indebtedness owed by Borrower to Lender;
          (b) liens for taxes,  assessments,  or similar  charges either (i) not
          yet  due,  or (ii)  being  contested  in  good  faith  by  appropriate
          proceedings for and which Borrower has established  adequate reserves;
          (c) purchase money liens or purchase money security  interests upon or
          in any property acquired or held by Borrower in the ordinary course of
          business to secure any  indebtedness  permitted  under this Agreement;
          and (d) liens and  security  interests  which,  as of the date of this
          Agreement,  have  been  disclosed  to and  approved  by the  Lender in
          writing.

          Related  Documents.  The words  "Related  Documents"  mean and include
          without   limitation  the  Note  and  all  credit   agreements,   loan
          agreements, environmental agreements, guaranties, security agreements,
          mortgages,  deeds of trust, and all other instruments,  agreements and
          documents,  whether now or hereafter existing,  executed in connection
          with the Note.

                                       2
<PAGE>

          Security  Agreement.  The words "Security  Agreement" mean and include
          without limitation any agreements, promises, covenants,  arrangements,
          understandings or other agreements,  whether created by law, contract,
          or  otherwise,  evidencing,  governing,  representing,  or  creating a
          Security Interest.

          Security  Interest.  The words  "Security  Interest"  mean and include
          without limitation any type of security interest,  whether in the form
          of a lien,  charge,  mortgage,  deed  of  trust,  assignment,  pledge,
          chattel  mortgage,  chattel  trust,  factor's lien,  equipment  trust,
          conditional  sale,  trust receipt,  lien or title retention  contract,
          lease or  consignment  intended  as a  security  device,  or any other
          security  or  lien  interest  whatsoever,   whether  created  by  law,
          contract, or otherwise.

REPRESENTATIONS AND WARRANTIES.  Borrower represents and warrants to Lender, as
of the date of this Agreement,  as of the date of each request for an advance or
disbursement  of Loan  proceeds,  as of the date of any  renewal,  extension  or
modification of any Loan, and at all times any indebtedness exists hereafter:

          Organization.  Borrower  is a  corporation  which  is duly  organized,
          validly existing,  and in good standing under the laws of the State of
          Indiana and is duly qualified and in good standing in all other states
          in which Borrower is doing  business.  Borrower has the full power and
          authority  to own its  properties  and to transact the  businesses  in
          which it is presently engaged or presently proposes to engage.

          Authorization.  The  execution,  delivery,  and  performance  of  this
          Agreement and all Related  Documents to which Borrower is a party have
          been duly  authorized  by all  necessary  action;  do not  require the
          consent or  approval  of any other  person,  regulatory  authority  or
          governmental body; and do not conflict with, result in a violation of,
          or  constitute  a default  under (a) any  provision of its articles of
          incorporation  or organization,  or bylaws,  or any agreement or other
          instrument  binding  upon  Borrower  or  (b)  any  law,   governmental
          regulation,  court decree,  or order applicable to Borrower.  Borrower
          has all  requisite  power and  authority  to execute and deliver  this
          Agreement  and all other  Related  Documents  to which  Borrower  is a
          party.

          Financial  Information.  Each financial statement of Borrower supplied
          to  Lender  truly  and  completely   discloses   Borrower's  financial
          condition  as of the  date of the  statement,  and  there  has been no
          material adverse change in Borrower's  financial condition  subsequent
          to the date of the most recent financial statement supplied to Lender.
          Borrower has no material contingent obligations except as disclosed in
          such financial statements.

          Legal Effect.  This Agreement and all other Related Documents to which
          Borrower is a party constitute legal, valid and binding obligations of
          Borrower   enforceable  against  Borrower  in  accordance  with  their
          respective  terms,  except as limited  by  bankruptcy,  insolvency  or
          similar laws of general  application  relating to the  enforcement  of
          creditors'  rights  and  except to the extent  specific  remedies  may
          generally be limited by equitable principles.

                                       3
<PAGE>

         Properties.  Except as  contemplated by this Agreement or as previously
         disclosed in  Borrower's  financial  statements or in writing to Lender
         and as accepted by Lender,  and except for property tax liens for taxes
         not presently  due and payable,  Borrower is the sole owner of, and has
         good  title  to,  all of  Borrower's  properties  free and clear of all
         Security  Interests,  and has not executed  any  security  documents or
         financing  statements  relating to such  properties.  All of Borrower's
         properties  are titled in Borrower's  legal name,  and Borrower has not
         used, or filed a financing statement under, any other name for at least
         the last six (6) years.

         Compliance.  Except as  disclosed  in writing to Lender (a) Borrower is
         conducting  Borrower's  businesses  in  material  compliance  with  all
         applicable federal, state and local laws, statutes,  ordinances, rules,
         regulations,  orders,  determinations  and court  decisions,  including
         without  limitation,   those  pertaining  to  health  or  environmental
         matters,  and (b) Borrower  otherwise  does not have any known material
         contingent   liability  in   connection   with  the  release  into  the
         environment, disposal or the improper storage of any toxic or hazardous
         substance or solid waste.

         Litigation   and   Claims.   No   litigation,   claim,   investigation,
         administrative proceeding or similar action (including those for unpaid
         taxes) against  Borrower is pending or  threatened,  and no other event
         has occurred  which may in any one case or in the aggregate  materially
         adversely affect Borrower's  financial  condition or properties,  other
         than  litigation,  claims,  or other  events,  if any,  that  have been
         disclosed to and acknowledged by Lender in writing.

         Taxes.  All tax  returns  and  reports  of  Borrower  that  are or were
         required to be filed,  have been filed, and all taxes,  assessments and
         other  governmental  charges have been paid in full,  except those that
         have been  disclosed in writing to Lender which are presently  being or
         to be  contested  by Borrower in good faith in the  ordinary  course of
         business and for which adequate reserves have been provided.

         Lien Priority. Unless otherwise previously disclosed to and approved by
         Lender  in  writing,   Borrower  has  not  entered  into  any  Security
         Agreements,  granted a Security  Interest  or  permitted  the filing or
         attachment  of  any  Security  Interests  on or  affecting  any  of the
         Collateral, except in favor of Lender.

         Licenses,  Trademarks and Patents. Borrower possesses and will continue
         to  possess  all  permits,  licenses,  trademarks,  patents  and rights
         thereto which are needed to conduct Borrower's  business and Borrower's
         business  does not conflict  with or violate any valid rights of others
         with respect to the foregoing.

         Commercial  Purposes.  Borrower intends to use the Loan proceeds solely
         for business or commercial related purposes approved by Lender and such
         proceeds  will not be used for the  purchasing  or  carrying of "margin
         stock" as defined in  Regulation  U issued by the Board of Governors of
         the Federal Reserve System.

                                       4
<PAGE>

          Ineligible  Securities.  No  portion  or  any  advance  or  Loan  made
          hereunder shall be used directly or indirectly to purchase  ineligible
          securities,  as  defined  by  applicable  regulations  of the  Federal
          Reserve Board,  underwritten  by Lender or any other affiliate of Banc
          One  Corporation  during  the  underwriting  period  and  for 30  days
          thereafter.

          Employee  Benefit  Plans.  Each  employee  benefit  plan  as to  which
          Borrower may have any liability complies in all material respects with
          all  applicable  requirements  of  law  and  regulations,  and  (i) no
          Reportable Event nor Prohibited  Transaction (as defined in ERISA) has
          occurred  with  respect  to any  such  plan,  (ii)  Borrower  has  not
          withdrawn  from any such plan or  initiated  steps to do so,  (iii) no
          steps have been taken to terminate  any such plan,  and (iv) there are
          no  unfunded  liabilities  other than those  previously  disclosed  to
          Lender in writing.

          Location  of  Borrower's  Offices  and  Records.  Borrower's  place of
          business,  or Borrower's  chief executive  office if Borrower has more
          than one place of  business,  is  located  at 2701 KENT  AVENUE,  WEST
          LAFAYETTE,  IN 47906.  Unless  Borrower  has  designated  otherwise in
          writing  this  location is also the office or offices  where  Borrower
          keeps its records concerning the Collateral.

          Information.  All information heretofore or contemporaneously herewith
          furnished by Borrower to Lender for the  purposes of or in  connection
          with this Agreement or any transaction contemplated hereby is, and all
          information  hereafter furnished by or on behalf of Borrower to Lender
          will be, true and accurate in every material respect on the date as of
          which  such  information  is  dated  or  certified;  and  none of such
          information is or will be incomplete by omitting to state any material
          fact necessary to make such information not misleading.

          Survival of Representations and Warranties.  Borrower  understands and
          agrees that Lender, without independent investigation, is relying upon
          the above representations and warranties in extending Loan advances to
          Borrower.  Borrower further agrees that the foregoing  representations
          and warranties  shall be continuing in nature and shall remain in full
          force and effect during the term of this Agreement.

AFFIRMATIVE  COVENANTS.  Borrower  covenants and agrees with Lender that,  while
this Agreement is in effect, Borrower will:

          Depository Relationship.  Establish and maintain its primary operating
          account(s) with Lender.

          Litigation.  Promptly  inform  Lender in writing  of (a) all  material
          adverse changes in Borrower's  financial  condition,  (b) all existing
          and all threatened litigation, claims, investigations,  administrative
          proceedings  or similar  actions  affecting  Borrower or any Guarantor
          which could materially  affect the financial  condition of Borrower or
          the  financial  condition  of any  Guarantor,  and (c)  the  creation,
          occurrence  or  assumption  by  Borrower  of any actual or  contingent
          liabilities not permitted under this Agreement.

                                       5
<PAGE>

          Financial  Records.  Maintain its books and records in accordance with
          generally  accepted  accounting  principles,  applied on a  consistent
          basis,  and  permit  Lender to  examine,  audit and make and take away
          copies  or  reproductions  of  Borrower's  books  and  records  at all
          reasonable  times. If Borrower now or at any time hereafter  maintains
          any records (including  without limitation  computer generated records
          and computer  software programs for the generation of such records) in
          the  possession  of a third party,  Borrower,  upon request of Lender,
          shall  notify such party to permit  Lender free access to such records
          at all  reasonable  times and to  provide  Lender  with  copies of any
          records it may request, all at Borrower's expense.

          Financial Statements.  Furnish Lender with, as soon as available,  but
          in no event later than one hundred  twenty (120) days after the end of
          each fiscal year,  Borrower's  balance sheet,  income  statement,  and
          statement of changes in financial position for the year ended, audited
          by a certified public accountant satisfactory to Lender, together with
          the management  letter, if any, prepared by such accountants  promptly
          upon receipt,  and, as soon as  available,  but in no event later than
          forty five (45) days after the end of each fiscal quarter,  Borrower's
          balance sheet, income statement, and statement of changes in financial
          position  for the period  ended,  prepared and  certified,  subject to
          year-end  review  adjustments,  as correct to the best  knowledge  and
          belief by  Borrower's  chief  financial  officer  or other  officer or
          person  acceptable  to Lender.  All financial  reports  required to be
          provided  under this  Agreement  shall be prepared in accordance  with
          generally  accepted  accounting  principles,  applied on a  consistent
          basis, and certified by Borrower as being true and correct.

          Additional  Information.   Furnish  such  additional  information  and
          statement, lists of assets and liabilities,  agings of receivables and
          payables,  inventory schedules,  budgets,  forecasts, tax returns, and
          other  reports  with respect to  Borrower's  financial  condition  and
          business operations as Lender may request from time to time.

          Financial Covenants and Ratios. Comply at all times with the following
          covenants and ratios:

               Tangible Net Worth.  Maintain,  at all times, a minimum  Tangible
          Net Worth of not less than $15,000,000.00.

          For purposes of this  Agreement and to the extent the following  terms
          are utilized in this  Agreement,  the term  "Tangible Net Worth" shall
          mean  borrower's   total  assets   excluding  all  intangible   assets
          (including,  without  limitation,   goodwill,   trademarks,   patents,
          copyrights,  organization expenses, and similar intangible items) less
          total liabilities excluding  Subordinated Debt. The term "Subordinated
          Debt" shall mean all  indebtedness  owing by  Borrower  which has been
          subordinated by written agreement to all indebtedness now or hereafter
          owing  by  Borrower  to  Lender,  such  agreement  to be in  form  and
          substance  acceptable to Lender. The term "Working Capital" shall mean
          Borrower's Liquid Assets plus inventory, less current liabilities. The
          term  "Liquid  Assets"  shall  mean  borrower's   unencumbered   cash,
          marketable  securities and accounts  receivable  net of reserves.  The
          term "Cash Flow" shall mean net income after taxes,  and  exclusive of
          extraordinary  items, plus  depreciation and  amortization.  Except as
          provided above, all computations made to determine compliance with the
          requirements  contained in this paragraph  shall be made in accordance
          with generally accepted accounting principles, applied on a consistent
          basis, and certified by Borrower as being true and correct.

                                       6
<PAGE>

          Insurance.  Maintain fire and other risk insurance,  public  liability
          insurance, business interruption insurance and such other insurance as
          Lender  may  require  with  respect  to  Borrower's   properties   and
          operations,  in form, amounts,  coverages and with insurance companies
          reasonably  acceptable  to Lender.  Borrower,  upon request of Lender,
          will deliver to Lender from time to time the policies or  certificates
          of insurance in form  satisfactory to Lender,  including  stipulations
          that  coverages  will not be canceled or  diminished  without at least
          thirty (30) days' prior written notice to Lender.  In connection  with
          all  policies  covering  assets in which  Lender holds or is offered a
          Security  Interest for the Loans,  Borrower  will provide  Lender with
          such lender loss payable or other endorsements as Lender may require.

          Insurance Reports.  Furnish to Lender, upon request of Lender, reports
          on each existing  insurance  policy showing such information as Lender
          may reasonably  request,  including without  limitation the following:
          (a) the name of the insurer;  (b) the risks insured; (c) the amount of
          the policy; (d) the properties insured;  (e) the then current property
          values  on the basis of which  insurance  has been  obtained,  and the
          manner of determining those values; and (f) the expiration date of the
          policy.

          Other  Agreements.  Comply with all terms and  conditions of all other
          agreements,  whether now or hereafter  existing,  between Borrower and
          any other  party and  notify  Lender  immediately  in  writing  of any
          default in connection with any other such agreements.

          Loan Proceeds.  Use all Loan proceeds  solely for Borrower's  business
          operations, unless specifically consented to the contrary by Lender in
          writing.

          Taxes,  Charges  and  Liens.  Pay and  discharge  when  due all of its
          indebtedness  and  obligations,   including  without   limitation  all
          assessments,  taxes,  governmental charges, levies and liens, of every
          kind and nature,  imposed upon Borrower or its properties,  income, or
          profits,  prior to the date on which penalties  would attach,  and all
          lawful claims that, if unpaid,  might become a lien or charge upon any
          of  Borrower's  properties,  income,  or  profits;  provided  however,
          Borrower   will  not  be  required  to  pay  and  discharge  any  such
          assessment,  tax,  charge,  levy,  lien  or  claim  so long as (a) the
          legality of the same shall be contested  in good faith by  appropriate
          proceedings,  and (b)  Borrower  shall have  established  on its books
          adequate  reserves  with respect to such  contested  assessment,  tax,
          charge,  levy,  lien, or claim in accordance  with generally  accepted
          accounting principles.  Borrower,  upon demand of Lender, will furnish
          to Lender  evidence  of payment of the  assessments,  taxes,  charges,
          levies,   liens  and  claims  and  will   authorize  the   appropriate
          governmental  official  to  deliver  to  Lender  at any time a written
          statement of any assessments, taxes, charges, levies, liens and claims
          against Borrower's properties, income, or profits.

                                       7
<PAGE>

          Performance.  Perform  and  comply  with all  terms,  conditions,  and
          provisions set forth in this Agreement and in the Related Documents in
          a timely manner,  and promptly notify Lender if Borrower learns of the
          occurrence  of any event which  constitutes  an Event of Default under
          this Agreement or under any of the Related Documents.

          Operations.  Conduct its business  affairs in a reasonable and prudent
          manner  and in  compliance  with all  applicable  federal,  state  and
          municipal  laws,  ordinances,  rules and  regulations  respecting  its
          properties,  charters,  businesses and operations,  including  without
          limitation,  compliance with the Americans With  Disabilities Act, all
          applicable  environmental statutes,  rules, regulations and ordinances
          and with all minimum funding standards and other requirements of ERISA
          and other laws applicable to Borrower's employee benefit plans.

          Compliance  Certificate.  Unless waived in writing by Lender,  provide
          Lender  quarterly  within 45 days after the end of each fiscal quarter
          with a certificate  executed by Borrower's chief financial officer, or
          other officer or person acceptable to Lender,  (a) certifying that the
          representations  and  warranties  set forth in this Agreement are true
          and correct as of the date of the certificate and that, as of the date
          of the  certificate,  no Event of Default exists under this Agreement,
          and (b)  demonstrating  compliance  with all  financial  covenants set
          forth in this Agreement.

          Environmental  Compliance  and Reports.  Borrower  shall comply in all
          respects  with  all  federal,  state  and  local  environmental  laws,
          statutes, regulations and ordinances; not cause or permit to exist, as
          a result of an intentional or unintentional  action or omission on its
          part or on the part of any  third  party,  on  property  owned  and/or
          occupied by  Borrower,  any  environmental  activity  where damage may
          result to the  environment,  unless  such  environmental  activity  is
          pursuant to and in compliance  with the  conditions of a permit issued
          by the appropriate federal,  state or local governmental  authorities;
          and furnish to Lender  promptly  and in any event  within  thirty (30)
          days  after  receipt  thereof  a copy of any  notice,  summons,  lien,
          citation,   directive,   letter  or  other   communication   from  any
          governmental  agency or instrumentality  concerning any intentional or
          unintentional action or omission on Borrower's part in connection with
          any  environmental  activity  whether  or not  there is  damage to the
          environment and/or other natural resources.

          Additional  Assurances.  Make,  execute  and  deliver  to Lender  such
          promissory  notes,  mortgages,  deeds of trust,  security  agreements,
          financing statements,  instruments,  documents and other agreements as
          Lender or its attorneys may reasonably  request to evidence and secure
          the Loans and to perfect all Security Interests.

RECOVERY OF  ADDITIONAL  COSTS.  If the  imposition of or any change in any law,
rule  regulation or  guideline,  or the  interpretation  or  application  of any
thereof by any court of administrative or governmental  authority (including any
request or policy not  having  the force of law)  shall  impose,  modify or make
applicable  any taxes (except U.S.  federal,  state or local income or franchise
taxes imposed on Lender), reserve requirements, capital adequacy requirements or
other  obligations  which would (a) increase the cost to Lender for extending or
maintaining the credit  facilities to which this Agreement  relates,  (b) reduce
the amounts payable to Lender under this Agreement or the Related Documents,  or
(c) reduce the rate of return on Lender's  capital as a consequence  of Lender's
obligations  with  respect to the  credit  facilities  to which  this  Agreement
relates,  then  Borrower  agrees to pay Lender such  additional  amounts as will
compensate  Lender therefor,  within five (5) days after Lender's written demand
for such payment,  which demand shall be  accompanied  by an explanation of such
imposition or charge and a calculation  in reasonable  detail of the  additional
amounts  payable  by  Borrower,  which  explanation  and  calculations  shall be
conclusive in the absence of manifest error.

                                       8
<PAGE>

NEGATIVE  COVENANTS.  Borrower  covenants and agrees with Lender that while this
Agreement is in effect, Borrower shall not, without the prior written consent of
Lender:

          Maintain   Basic   Business.   Engage  in  any   business   activities
          substantially  different  than those in which  Borrower  is  presently
          engaged.

          Continuity of Operations.  Cease  operations,  liquidate,  dissolve or
          merge or consolidate with or into any other entity.

          Indebtedness.  Create,  incur or assume  additional  indebtedness  for
          borrowed   money,   including   capital   leases,   or  guarantee  any
          indebtedness  owing by others,  other than (a) current unsecured trade
          debt  incurred in the ordinary  course of business,  (b)  indebtedness
          owing to Lender, (c) borrowings  outstanding as of the date hereof and
          disclosed  to  Lender in  writing,  and (d) any  borrowings  otherwise
          approved by Lender in writing.

          Liens.  Mortgage,  assign,  pledge,  grant a security  interest  in or
          otherwise encumber Borrower's assets, except as allowed as a Permitted
          Lien.

          Transfer  of  Assets.  Transfer,  sell  or  other  dispose  of  any of
          Borrower's assets other than in the ordinary course of business.

          Change in  Management.  Permit a change  in the  senior  executive  or
          management personnel of Borrower.

          Transfer of Ownership.  Permit the sale,  pledge or other  transfer of
          any ownership interest in Borrower.

          Investments.  Invest in, or  purchase,  create,  form or  acquire  any
          interest in, any other enterprise or entity.

          Loans. Make any loans to any person or entity.

          Dividends.  Pay any dividends on Borrower's capital stock or purchase,
          redeem, retire or otherwise acquire any of Borrower's capital stock or
          alter or amend Borrower's capital structure.

                                       9
<PAGE>

          Affiliates. Enter into any transaction, including, without limitation,
          the  purchase,  sale,  or exchange of property or the rendering of any
          service, with any Affiliate of Borrower, except in the ordinary course
          of and pursuant to the reasonable  requirements of Borrower's business
          and upon fair and  reasonable  terms no less  favorable  than would be
          obtained in a  comparable  arm's length  transaction  with a person or
          entity  not an  Affiliate  of  Borrower.  As  used  herein,  the  term
          "Affiliate"  means any  individual  or entity  directly or  indirectly
          controlling,  controlled  by or under  common  control  with,  another
          entity or individual.

CONDITIONS  PRECEDENT  TO  ADVANCES.  If  Lender is  obligated  to make any Loan
advances or to otherwise disburse any Loan proceeds to Borrower, such obligation
shall be subject to the conditions precedent that as of the date of such advance
or  disbursement  an after giving  effect  thereto (a) all  representations  and
warranties  made to Lender in this Agreement and the Related  Documents shall be
true and  correct as of and as if made on such  date,  (b) no  material  adverse
change  in the  financial  condition  of  Borrower  or any  Guarantor  since the
effective date of the most recent financial  statements  furnished to Lender, or
in the value of any  Collateral,  shall have occurred and be continuing,  (c) no
event has occurred and is continuing, or would result from the requested advance
or  disbursement,  which with notice or lapse of time, or both, would constitute
an Event of Default, (d) no Guarantor has sought, claimed or otherwise attempted
to limit, modify or revoke such Guarantor's guaranty of any Loan, and (e) Lender
has received all Related  Documents  appropriately  executed by Borrower and all
other proper parties.

AMENDMENT. This Loan Agreement (this "Agreement") shall amend and replace in its
entirety a certain  Business  Loan  Agreement  between the Borrower and Bank One
dated  April 2, 1999,  as such  Agreement  may have been  amended  and  modified
thereafter prior to the date of this Agreement.

ADDITIONAL  AFFIRMATIVE COVENANT - FIXED CHARGE COVERAGE RATIO. Borrower further
covenants  and agrees  with  Lender  that,  while this  Agreement  is in effect,
Borrower will comply with the following ratio:  Maintain,  annually,  a ratio of
(a) net income before taxes,  interest,  depreciation and amortization,  for the
twelve  month  period  then  ending,  to (b) the sum of  interest,  the  current
maturities  of long  term  debt,  Distributions  and cash  capital  expenditures
(capital  expenditures  net of external  financing)  for the same  twelve  month
period, of not less than 1.20 to 1.00.

ADDITIONAL  AFFIRMATIVE  COVENANT  -  FUNDED  DEBT TO  EBITA.  Borrower  further
covenants  and agrees  with  Lender  that,  while this  Agreement  is in effect,
Borrower will comply at all times with the following ratio:  Maintain, as of the
end of each fiscal  quarter,  a ratio of (a) Funded  Debt,  for the twelve month
period  then  ending,  to  (b)  net  income  before  taxes,  plus  depreciation,
amortization  and interest,  for the same twelve month period,  of not more than
3.00 to 1.00.  For purposes of this  Agreement  and to the extent the  following
terms are utilized in this Agreement:  The term "Distributions",  shall mean all
dividends  and  other  distributions  made  by  Borrower  to  its  shareholders,
partners,  owners or members, as the case may be, other than salary, bonuses and
other  compensation  for  services  expended in the current  accounting  period.
"Funded  Debt"  means  (a)  all  obligations  of  Borrower  (including,  without
limitation,  all fees, costs or unpaid accrued  interest) for or with respect to

                                       10
<PAGE>

borrowed  money or for the  deferred  purchase  price of property  or  services,
except current accounts payable arising in the ordinary course of business;  (b)
all  obligations of Borrower  created or arising under any  conditional  sale or
other  title  retention  agreement  with  respect to any  property  acquired  by
Borrower and all obligations created or arising under such agreement even though
the  rights  and  remedies  of the seller or lender  thereunder  are  limited to
repossession  or  sale  of  such  property  in the  event  of  default;  (c) all
obligations of Borrower under leases which shall have been or should be recorded
as  capitalized  leases  in  accordance  with  generally   accepted   accounting
principles;  (d) all guarantees and other obligations  (contingent or otherwise)
of Borrower to assure a creditor  against loss (including,  without  limitation,
letters of  responsibility  or comfort  letters,  arrangements  to  purchase  or
repurchase  property or  obligations  to pay for  property,  goods or  services,
whether or not delivered or rendered to maintain working capital, equity capital
or other  financial  statement  condition of, or to lend or contribute or invest
in, any other entity);  (e) all endorsements of Borrower (other than in the case
of  instruments  for deposit or collection in the ordinary  course of business);
(f) all  obligations  of Borrower for  extensions  of credit  including the face
amount  of  letters  of  credit to or on  behalf  of  Borrower,  whether  or not
representing  obligations  for  borrowed  money;  and  (g)  all  obligations  or
indebtedness  described  in clauses  (a)  through  (f)  secured by a lien on any
property owned by Borrower, whether or not Borrower has assumed or become liable
for the payment  thereof.  Except as provided above,  all  computations  made to
determine compliance with the requirements  contained in this paragraph shall be
made in accordance with generally accepted accounting  principles,  applied on a
consistent basis, and certified by Borrower as being true and correct.

RIGHT OF SETOFF.  Unless a lien  would be  prohibited  by law or would  render a
nontaxable  account  taxable,  Borrower grants to Lender a contractual  security
interest in, and hereby assigns,  conveys,  delivers,  pledges, and transfers to
Lender all Borrower's right,  title and interest in and to, Borrower's  accounts
with Lender (whether checking, savings, or any other account), including without
limitation all accounts held jointly with someone else and all accounts Borrower
may open in the future.  Borrower  authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on the  Indebtedness  against
any and all such accounts.

EVENTS OF DEFAULT.  Each of the following  shall  constitute an Event of Default
under this Agreement:

          Default on Indebtedness.  Failure of Borrower to make any payment when
          due on any of the Indebtedness.

          Other Defaults.  Failure of Borrower,  any Guarantor or any Grantor to
          comply  with or to  perform  when  due  any  other  term,  obligation,
          covenant or condition contained in this Agreement,  the Note or in any
          of the other Related Documents,  or failure of Borrower to comply with
          or to  perform  any other  term,  obligation,  covenant  or  condition
          contained in any other  agreement  now  existing or hereafter  arising
          between Lender and Borrower.

          False  Statements.  Any warranty,  representation or statement made or
          furnished to Lender under this  Agreement or the Related  Documents is
          false or misleading in any material respect.

                                       11
<PAGE>

          Default to Third Party.  The occurrence of any event which permits the
          acceleration  of the maturity of any  indebtedness  owing by Borrower,
          Grantor or any  Guarantor  to any third party under any  agreement  or
          understanding.

          Bankruptcy or Insolvency.  If the Borrower,  Grantor or any Guarantor:
          (i) becomes insolvent,  or makes a transfer in fraud of creditors,  or
          makes an assignment for the benefit of creditors, or admits in writing
          its inability to pay its debts as they become due;  (ii)  generally is
          not paying its debts as such debts  become due;  (iii) has a receiver,
          trustee or  custodian  appointed  for, or take  possession  of, all or
          substantially  all  of  the  assets  of  such  party  or  any  of  the
          Collateral,  either  in a  proceeding  brought  by such  party or in a
          proceeding  brought  against  such party and such  appointment  is not
          discharged or such possession is not terminated within sixty (60) days
          after  the  effective  date  thereof  or  such  party  consents  to or
          acquiesces in such  appointment or  possession;  (iv) files a petition
          for  relief  under  the  United  States  Bankruptcy  Code or any other
          present or future federal or state  insolvency,  bankruptcy or similar
          laws (all of the foregoing hereinafter collectively called "Applicable
          Bankruptcy  Law")  or an  involuntary  petition  for  relief  is filed
          against  such  party  under  any  Applicable  Bankruptcy  Law and such
          involuntary petition is not dismissed within sixty (60) days after the
          filing  thereof,  or an order for relief  naming such party is entered
          under   any   Applicable   Bankruptcy   Law,   or   any   composition,
          rearrangement,  extension,  reorganization  or other relief of debtors
          now or hereafter  existing is requested or consented to by such party;
          (v) fails to have  discharged  within a period of sixty  (60) days any
          attachment,  sequestration or similar writ levied upon any property of
          such  party;  or (vi) fails to pay within  thirty  (30) days any final
          money judgment against such party.

          Liquidation,  Death and Related  Events.  If Borrower,  Grantor or any
          Guarantor  is an  entity,  the  liquidation,  dissolution,  merger  or
          consolidation  of any such  entity  or, if any of such  parties  is an
          individual, the death or legal incapacity of any such individual.

          Creditor or Forfeiture  Proceedings.  Commencement  of  foreclosure or
          forfeiture  proceedings,  whether by judicial  proceeding,  self-help,
          repossession  or any other  method,  by any creditor of Borrower,  any
          creditor  of  any  Grantor   against  any   collateral   securing  the
          indebtedness, or by any governmental agency.

EFFECT OF AN EVENT OF DEFAULT.  If any Event of Default shall occur, Lender may,
at its option,  without further notice or demand,  (a) terminate all commitments
and  obligations  of Lender to make Loans to  Borrower,  if any, (b) declare all
Loans and any other  Indebtedness  immediately  due and  payable,  (c) refuse to
advance any  additional  amounts  under the Note, or (d) exercise all the rights
and  remedies  provided  in the  Note  or in any of  the  Related  Documents  or
available at law, in equity, or otherwise;  provided,  however,  if any Event of
Default of the type described in the "Bankruptcy or Insolvency" subsection above
shall occur, all Loans and any other Indebtedness shall automatically become due
and payable,  without any notice,  demand or action by Lender.  Except as may be
prohibited  by  applicable  law, all of Lender's  rights and  remedies  shall be
cumulative and may be exercised  singularly or concurrently.  Election by Lender
to pursue any remedies  shall not exclude  pursuit of any other  remedy,  and an
election  to make  expenditures  or to take action to perform an  obligation  of
Borrower or any Grantor shall not affect Lender's right to declare a default and
to exercise its rights and remedies.

                                       12
<PAGE>

MISCELLANEOUS PROVISIONS.

     Amendments.   This   Agreement,   together  with  any  Related   Documents,
     constitutes the entire understanding and agreement of the parties as to the
     matters set forth in this Agreement.  No alteration of or amendment to this
     Agreement  shall be  effective  unless  given in writing  and signed by the
     party or  parties  sought  to be  charged  or bound  by the  alteration  or
     amendment.

     Applicable Law. This Agreement has been delivered to Lender and accepted by
     Lender in the State of Indiana.  Subject to the Provisions on  arbitration,
     this  Agreement  shall be governed by and construed in accordance  with the
     laws of the State of  Indiana  without  regard to any  conflict  of laws or
     provisions thereof.

     JURY WAIVER.  THE UNDERSIGNED AND LENDER (BY ITS ACCEPTANCE  HEREOF) HEREBY
     VOLUNTARILY,  KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT TO
     HAVE A JURY  PARTICIPATE  IN  RESOLVING  ANY  DISPUTE  (WHETHER  BASED UPON
     CONTRACT,  TORT OR OTHERWISE)  BETWEEN OR AMONG THE  UNDERSIGNED AND LENDER
     ARISING  OUT OF OR IN ANY WAY  RELATED  TO  THIS  DOCUMENT,  AND ANY  OTHER
     RELATED DOCUMENT, OR ANY RELATIONSHIP BETWEEN LENDER AND THE BORROWER. THIS
     PROVISION  IS A  MATERIAL  INDUCEMENT  TO LENDER TO PROVIDE  THE  FINANCING
     DESCRIBED HEREIN OR IN THE OTHER RELATED DOCUMENTS.

     ARBITRATION.  Lender and  Borrower  agree that upon the  written  demand of
     either  party,  whether made before or after the  institution  of any legal
     proceedings, but prior to the rendering of any judgment in that proceeding,
     all disputes,  claims and controversies  between them, whether  individual,
     joint,  or class in  nature,  arising  from  this  Agreement,  any  Related
     Document or otherwise,  including without limitation  contract disputes and
     tort  claims,  shall be  resolved  by binding  arbitration  pursuant to the
     Commercial  Rules of the  American  Arbitration  Association  ("AAA").  Any
     arbitration proceeding held pursuant to this arbitration provision shall be
     conducted in the city nearest the Borrower's address having an AAA regional
     office,  or at any other place selected by mutual agreement of the parties.
     No act to take or dispose of any  Collateral  shall  constitute a waiver of
     this arbitration agreement or be prohibited by this arbitration  agreement.
     This arbitration provision shall not limit the right of either party during
     any dispute,  claim or controversy to seek, use, and employ  ancillary,  or
     preliminary rights and/or remedies, judicial or otherwise, for the purposes
     of realizing upon, preserving,  protecting,  foreclosing upon or proceeding
     under  forcible  entry and detainer for possession of, any real or personal
     property,  and any such action shall not be deemed an election of remedies.
     Such remedies include, without limitation, obtaining injunctive relief or a
     temporary  restraining  order,  involving a power of sale under any deed of
     trust or  mortgage,  obtaining  a writ of  attachment  or  imposition  of a
     receivership,  or  exercising  any rights  relating to  personal  property,
     including  exercising the right of set-off,  or taking or disposing of such
     property  with  or  without   judicial  process  pursuant  to  the  Uniform
     Commercial  Code. Any disputes,  claims,  or  controversies  concerning the
     lawfulness or reasonableness of an act, or exercise of any right or remedy,
     concerning  any  Collateral,  including  any claim to rescind,  reform,  or

                                       13
<PAGE>

     otherwise  modify any agreement  relating to the Collateral,  shall also be
     arbitrated;  provided,  however that no arbitrator  shall have the right or
     the power to enjoin or restrain any act of either party.  Judgment upon any
     award  rendered  by any  arbitrator  may be  entered  in any  court  having
     jurisdiction.  The  statue of  limitations,  estoppel,  waiver,  laches and
     similar  doctrines which would otherwise be applicable in an action brought
     by a party  shall be  applicable  in any  arbitration  proceeding,  and the
     commencement of an arbitration  proceeding shall be deemed the commencement
     of any action for these purposes.  The Federal  Arbitration Act (Title 9 of
     the United  States Code) shall apply to the  construction,  interpretation,
     and enforcement of this arbitration provision.

          Caption   Headings.   Caption  headings  in  this  Agreement  are  for
          convenience  purposes  only  and are not to be  used to  interpret  or
          define the provisions of this Agreement.

          Consent  to  Loan  Participation.  Borrower  agrees  and  consents  to
          Lender's  sale  or  transfer,  whether  now or  later,  of one or more
          participation  interests  in the  Loans  to one  or  more  purchasers,
          whether  related or unrelated to Lender.  Lender may provide,  without
          any limitation whatsoever, to any one or more purchasers, or potential
          purchasers,  any  information  or  knowledge  Lender  may  have  about
          Borrower or about any other matter  relating to the Loan, and Borrower
          hereby  waives any rights to privacy it may have with  respect to such
          matters.  Borrower  additionally waives any and all notices of sale of
          participation  interests,  as well as all notices of any repurchase of
          such participation interests.

          Costs and Expenses. Borrower agrees to pay upon demand all of Lender's
          expenses,  including  attorneys' fees, incurred in connection with the
          preparation,  execution,  enforcement,  modification and collection of
          this  Agreement or in connection  with the Loans made pursuant to this
          Agreement.  Lender may hire one or more  attorneys to help collect the
          Indebtedness  if Borrower does not pay, and Borrower will pay Lender's
          reasonable attorneys' fees.

          Notices.  All notices  required to be given under this Agreement shall
          be given in writing, and shall be effective when actually delivered or
          when  deposited  with a  nationally  recognized  overnight  courier or
          deposited in the United  States mail,  first class,  postage  prepaid,
          addressed  to the  party  to whom  the  notice  is to be  given at the
          address  shown  above.  Any party may change its  address  for notices
          under this  Agreement  by giving  formal  written  notice to the other
          parties,  specifying  that the  purpose of the notice is to change the
          party's  address.  For  notice  purposes,  Borrower  will keep  Lender
          informed at all times of Borrower's current address(es).

          Severability. If a court of competent jurisdiction finds any provision
          of this Agreement to be invalid or  unenforceable  as to any person or
          circumstance,  such finding shall not render that provision invalid or
          unenforceable as to any other persons or  circumstances.  If feasible,
          any such  offending  provision  shall be deemed to be  modified  to be
          within the  limits of  enforceability  or  validity;  however,  if the
          offending  provision  cannot be so modified,  it shall be stricken and
          all other  provisions of this  Agreement in all other  respects  shall
          remain valid and enforceable.

                                       14
<PAGE>

          Counterparts.   This   Agreement  may  be  executed  in  one  or  more
          counterparts,  each of which  shall be deemed an  original  and all of
          which together shall constitute the same document. Signature pages may
          be detached from the  counterparts  to a single copy of this Agreement
          to physically form one document.

          Successors and Assigns.  All covenants and agreements  contained by or
          on behalf of Borrower  shall bind its successors and assigns and shall
          inure to the benefit of Lender,  its successors and assigns.  Borrower
          shall not,  however,  have the right to assign  its rights  under this
          Agreement or any interest  therein,  without the prior written consent
          of Lender.

          Survival.  All  warranties,  representations,  and  covenants  made by
          Borrower in this Agreement or in any  certificate or other  instrument
          delivered  by  Borrower  to  Lender  under  this  Agreement  shall  be
          considered  to have been  relied  upon by Lender and will  survive the
          making of the Loan and  delivery to Lender of the  Related  Documents,
          regardless of any investigation made by Lender or on Lender's behalf.

          Time is of the Essence.  Time is of the essence in the  performance of
          this Agreement.

          Waiver.  Lender  shall not be deemed to have  waived any rights  under
          this  Agreement  unless  such waiver is given in writing and signed by
          Lender.  No delay or omission on the part of Lender in exercising  any
          right shall  operate as a waiver of such right or any other  right.  A
          waiver by Lender of a provision of this Agreement  shall not prejudice
          or  constitute a waiver of Lender's  right  otherwise to demand strict
          compliance  with  that  provision  or  any  other  provision  of  this
          Agreement.  No prior  waiver by  Lender,  not any  course  of  dealing
          between  Lender and  Borrower,  or between  Lender and any  Grantor or
          Guarantor,  shall  constitute a waiver of any of Lender's rights or of
          any  obligations  of  Borrower  or of any  Grantor  as to  any  future
          transactions.  Whenever  the consent of Lender is required  under this
          Agreement,  the  granting  of such  consent by Lender in any  instance
          shall not constitute  continuing consent in subsequent instances where
          such consent is required, and in all cases such consent may be granted
          or withheld in the sole discretion of Lender.

                                       15
<PAGE>

BORROWER  ACKNOWLEDGES  HAVING READ ALL THE  PROVISIONS  OF THIS  BUSINESS  LOAN
AGREEMENT,  AND BORROWER  AGREES TO ITS TERMS.  THIS AGREEMENT IS EXECUTED AS OF
THE DATE SET FORTH ABOVE.

BORROWER:

BIOANALYTICAL SYSTEMS, INC.

By: ______________________________________
         AUTHORIZED SIGNER

LENDER:

Bank One, Indiana, NA

By: ______________________________________
         Authorized Officer

                                       16

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