Document:

Exhibit
10.1

FIFTH AMENDMENT

THIS FIFTH AMENDMENT
(this “Amendment”) dated as of August 16, 2006 to the Credit Agreement
referenced below is by and among Advance
America, Cash Advance Centers, Inc., a Delaware corporation (the “Borrower”),
the Guarantors identified on the signature pages hereto (the “Guarantors”),
the Lenders identified on the signature pages hereto and Bank of America, N.A.,
as administrative agent (the “Administrative Agent”).

W I T N E S S E T
H

WHEREAS, a $265
million revolving credit facility has been extended to the Borrower pursuant to
the Amended and Restated Credit Agreement (as amended, modified and
supplemented from time to time, the “Credit Agreement”) dated as of July
16, 2004 among the Borrower, the Guarantors, the Lenders identified therein and
Bank of America, N.A., as Administrative Agent; and

WHEREAS, the
Borrower has requested certain modifications to the Credit Agreement and the Required
Lenders have agreed to the requested modifications on the terms and conditions set
forth herein.

NOW, THEREFORE, IN
CONSIDERATION of the premises and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

1.         Defined Terms.  Capitalized terms used herein but not
otherwise defined herein shall have the meanings provided to such terms in the
Credit Agreement.

2.         Amendments.

2.1       In Section 1.1 of the
Credit Agreement, the definition of “Permitted Stock Repurchase” is amended to
read as follows:

“Permitted
Stock Repurchase” means the repurchase of Capital Stock of the Borrower in
an aggregate amount of up to (i) prior to the date of the Fifth Amendment to
the Credit Agreement, $50 million and (i) on and after the date of the Fifth
Amendment to the Credit Agreement, $100 million (excluding any repurchases made
prior to the date of the Fifth Amendment to the Credit Agreement).

2.2       In Section
7.1(b)(ii)(A), (B) and (C) of the Credit Agreement, the phrase “forty-five (45)
days” is amended to read “forty-five (45) days (or, in the case of the fourth
fiscal quarter, seventy-five (75) days)”.

3.         Conditions Precedent.  This
Amendment shall be effective as of the date hereof upon execution of this
Amendment by the Credit Parties and the Required Lenders.

4.         Reaffirmation
of Representations and Warranties. 
The Borrower and each Guarantor represents and warrants that the
representations and warranties set forth in the Credit Agreement and the other
Credit Documents are true and correct in all material respects as of the date
hereof (except those that expressly relate to an earlier period).

5.         Reaffirmation of Guaranty.  Each
Guarantor (a) acknowledges and consents to all of the terms and conditions of
this Amendment, (b) affirms all of its obligations under the Credit Documents and
(c) agrees that this Amendment and all documents executed in connection
herewith do not operate to reduce or discharge such Guarantor’s obligations
under the Credit Documents.

6.         Reaffirmation of Security Interests.  The
Borrower and each Guarantor (i) affirms that
each of the Liens granted in or pursuant to the Credit Documents are valid and
subsisting and (ii) agrees that this Amendment shall in no manner impair or
otherwise adversely effect any of the Liens granted in or pursuant to the
Credit Documents.

7.         No
Other Changes.  Except as modified
hereby, all of the terms and provisions of the Credit Documents (including
schedules and exhibits thereto) shall remain in full force and effect.

8.         Counterparts.  This Amendment may be executed in any number
of counterparts, each of which when so executed and delivered shall be deemed
an original and it shall not be necessary in making proof of this Amendment to
produce or account for more than one such counterpart.

9.         Governing
Law.  This Amendment shall be deemed
to be a contract made under, and for all purposes shall be construed in
accordance with, the laws of the State of North Carolina.

[Signature Pages Follow]

 

IN WITNESS WHEREOF, each of
the parties hereto has caused a counterpart of this Fifth Amendment to be duly
executed and delivered as of the date first above written.

BORROWER:

ADVANCE AMERICA, CASH ADVANCE
CENTERS, INC., a Delaware corporation

By:          /s/
Kenneth E. Compton                     

Name:     Kenneth
E. Compton

Title:       Chief Executive Officer and President

GUARANTORS:

AARC, INC., a Delaware
corporation

By:          /s/ Monica L. Allie                               

Name:     Monica
L. Allie

Title:       President

ADVANCE AMERICA SERVICING OF ARKANSAS, INC., a Delaware corporation

ADVANCE AMERICA SERVICING OF INDIANA, INC., a Delaware corporation

ADVANCE AMERICA LEASING SERVICES, INC., a Delaware corporation

AAIC, INC., a Delaware corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF ALABAMA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF ALASKA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF ARIZONA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF ARKANSAS, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF CALIFORNIA, LLC,

a Delaware limited liability company

ADVANCE AMERICA, CASH ADVANCE CENTERS OF COLORADO, LLC,

a Delaware limited liability company

ADVANCE AMERICA, CASH ADVANCE CENTERS OF CONNECTICUT, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF DELAWARE, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF DISTRICT OF COLUMBIA, INC.,

a Delaware corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF FLORIDA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF GEORGIA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF HAWAII, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF IDAHO, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF ILLINOIS, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF INDIANA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF IOWA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF KANSAS, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF KENTUCKY, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF LOUISIANA, LLC, a Delaware
limited liability company

ADVANCE AMERICA, CASH ADVANCE CENTERS OF MAINE, INC., a Delaware
corporation

ADVANCE AMERICA, CASH
ADVANCE CENTERS OF MARYLAND, INC., a Delaware corporation

By:          /s/ Kenneth E. Compton                     

Name:     Kenneth
E. Compton

Title:       Chief Executive Officer and President

[Signature Pages
Continue]

 

ADVANCE AMERICA, CASH ADVANCE CENTERS OF MASSACHUSETTS, INC., a
Delaware corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF MICHIGAN, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF MINNESOTA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF MISSISSIPPI, LLC,

a Delaware limited liability company

ADVANCE AMERICA, CASH ADVANCE CENTERS OF MISSOURI, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF MONTANA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF NEBRASKA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF NEVADA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF NEW HAMPSHIRE, INC., a
Delaware corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF NEW JERSEY, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF NEW MEXICO, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF NEW YORK, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF NORTH CAROLINA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF NORTH DAKOTA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF OHIO, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF OKLAHOMA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF OREGON, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF PENNSYLVANIA, LLC, a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF RHODE ISLAND, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF SOUTH CAROLINA, INC., a
Delaware corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF SOUTH DAKOTA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF TENNESSEE, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF TEXAS, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF UTAH, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF VERMONT, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF VIRGINIA, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF WASHINGTON, LLC,

a Delaware limited liability company

ADVANCE AMERICA, CASH ADVANCE CENTERS OF WEST VIRGINIA, INC., a
Delaware corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF WISCONSIN, INC., a Delaware
corporation

ADVANCE AMERICA, CASH ADVANCE CENTERS OF WYOMING, INC., a Delaware
corporation

ADVANCE AMERICA SERVICING OF GEORGIA, INC., a Delaware corporation

MCKENZIE CHECK ADVANCE OF ALABAMA, L.L.C., a Tennessee limited
liability company

MCKENZIE CHECK ADVANCE OF ARKANSAS, LLC, a Tennessee limited liability
company

MCKENZIE CHECK ADVANCE OF COLORADO, LLC, a Tennessee limited liability
company

MCKENZIE CHECK ADVANCE OF INDIANA, LLC, a Tennessee limited liability
company

MCKENZIE CHECK ADVANCE OF IOWA, L.L.C., a Tennessee limited liability
company

MCKENZIE CHECK ADVANCE OF KANSAS, LLC, a Tennessee limited liability
company

MCKENZIE CHECK ADVANCE OF MISSISSIPPI, LLC, a Tennessee limited
liability company

MCKENZIE CHECK ADVANCE OF MISSOURI, L.L.C., a Tennessee limited
liability company

MCKENZIE CHECK ADVANCE OF NEBRASKA, LLC, a Tennessee limited liability
company

MCKENZIE CHECK ADVANCE OF NEW JERSEY, L.L.C., a Tennessee limited
liability company

MCKENZIE CHECK ADVANCE OF OHIO, LLC, a Tennessee limited liability
company

MCKENZIE CHECK ADVANCE OF OREGON, LLC, a Tennessee limited liability
company

MCKENZIE CHECK ADVANCE OF WASHINGTON, L.L.C., a Tennessee limited
liability company

MCKENZIE CHECK
ADVANCE OF WISCONSIN, LLC, a Tennessee limited liability company

NCAS OF DELAWARE, LLC, a
Delaware limited liability company

NCAS OF NEW JERSEY, LLC,
a Delaware limited liability company

By:          /s/ Kenneth E. Compton                     

Name:     Kenneth
E. Compton

Title:       Chief Executive Officer and President

[Signature Pages
Continue]

 

AA CHALLENGER, LLC, a Delaware limited liability company

AA AIR, LLC, a Delaware
limited liability company

ADVANCE AMERICA MONEY.COM, INC., a Delaware corporation

ACSO OF MICHIGAN, INC., a
Delaware corporation

By:          /s/ Kenneth E. Compton                     

Name:     Kenneth
E. Compton

Title:       Chief Executive Officer and President

ACSO OF TEXAS, L.P.,

a Texas limited partnership

ADVANCE AMERICA SERVICING OF TEXAS, L.P.,

a Texas limited
partnership

By:          ADVANCE AMERICA, CASH
ADVANCE CENTERS OF TEXAS, INC.,
                a Delaware corporation and
its general partner

 

By:          /s/ Kenneth E. Compton                     

Name:     Kenneth E. Compton

Title:       Chief
Executive Officer and President

W.P.S. SYSTEMS, LTD. OF NEW ENGLAND,

a Rhode Island
corporation

By:                              ADVANCE
AMERICA, CASH ADVANCE CENTERS OF RHODE ISLAND, INC.,

a Delaware corporation

By:          /s/ Kenneth E. Compton                     

Name:     Kenneth E. Compton

Title:       Chief
Executive Officer and President

[Signature Pages
Continue]

 

NCA OF LOUISIANA, LLC, a
Delaware limited liability company

By:          /s/ Kenneth E. Compton                     

Name:     Kenneth
E. Compton

Title:       Chief Executive Officer and President

[Signature Pages
Continue]

 

ADMINISTRATIVE

AGENT:                                                      BANK OF AMERICA, N.A., as Administrative
Agent

By:                                                                          

Name:

Title:

LENDERS:                                                BANK OF AMERICA, N.A., as a Lender

By:                                                                          

Name:     Scott K. Mitchell

Title:       Senior Vice President

WACHOVIA BANK, NATIONAL
ASSOCIATION

By:                                                                          

Name:

Title:

US BANK NATIONAL ASSOCIATION

By:                                                                          

Name:

Title:

WELLS
FARGO BANK, N.A.

By:                                                                          

Name:

Title:

NATIONAL CITY BANK OF
PENNSYLVANIA

By:                                                                          

Name:

Title:

NATIONAL BANK OF SOUTH
CAROLINA

By:                                                                          

Name:

Title:

CAROLINA FIRST BANK

By:                                                                          

Name:

Title:

[Signature Pages Continue]

 

FIRST TENNESSEE BANK
NATIONAL ASSOCIATION

By:                                                                          

Name:

Title:

BRANCH
BANKING AND TRUST COMPANY

By:                                                                          

Name:

Title:

TEXAS
CAPITAL BANK, NA

By:                                                                          

Name:

Title:EXHIBIT 10.1

                           LOAN AND SECURITY AGREEMENT

THIS LOAN AND SECURITY AGREEMENT (the "Agreement") is made as of this 11th day
of August, 2006 by and between SLS INTERNATIONAL, INC., A DELAWARE CORPORATION
with an address at 1650 W. Jackson, Ozark, Missouri 65721 ("Borrower") and
CAPITAL GROWTH ASSET BASED BRIDGE LOAN FUND II, LLC, with an address at 2201 NW
Corporate Blvd., Suite 201, Boca Raton, Florida 33431 ("LENDER"). In connection
with the mutual covenants and agreements contained herein, the parties hereto
agrees as follows:

1.       DEFINITIONS. All terms and phrases used herein which are defined in the
         Uniform Commercial Code in the State of Florida, as amended from time
         to time (the "UCC"), shall have the meanings given them in the UCC
         unless otherwise defined herein. The following definitions shall apply
         throughout this Agreement:

         "AFFILIATE" means with respect to any Person in question, any other
         Person owned or controlled by, or which owns or controls or is under
         common control or is otherwise affiliated with such Person in question.
         A Person shall be deemed to control another Person if such Person
         possesses, directly or indirectly, the power to direct or cause the
         direction of the management and policies of such other Person, whether
         through the ownership of voting securities, by contract or otherwise.

         "BUSINESS DAY" means any day other than Saturday, Sunday or any other
         day on which LENDER's office in Boca Raton, Florida is closed.

         "COLLATERAL" has the meaning given it in Section 4.

         "COST" means the lesser of actual cost or market value of Inventory.

          "CREDIT FACILITIES" has the meaning given it in Section 2.

         "ELIGIBLE INVENTORY" means and includes that inventory (other than
         packaging materials, labels and supplies) which LENDER, in its sole
         credit judgment, deems to be Eligible Inventory. Without limiting the
         generality of the forgoing, no inventory shall be Eligible Inventory
         unless: (i) it is finished goods or raw materials, (ii) at all times it
         strictly complies with all of Borrower's warranties and representations
         to LENDER, (iii) it is in good, new and salable condition (iv) it is
         not slow moving or is not obsolete or unmerchantable, in LENDER's sole
         and absolute discretion, (v) it meets all standards imposed by any
         insurance company or underwriter or governmental agency or authority,
         (vi) it is at all times subject to LENDER's duly perfected, first
         priority security interest and there exists no other lien or
         encumbrance other than as permitted hereunder, (vii) it is in
         Borrower's possession and control situated at a location in compliance
         with this Agreement, (viii) it is not in the hands of any third party,
         including a warehouseman, finisher, consignee, etc., (ix) it is not
         subject to any license or other agreement that limits, conditions, or
         restricts Borrower's or LENDER's right to sell or otherwise dispose of
         such Inventory, (x) is not of a type that LENDER, in its sole and
         absolute discretion, has determined is not Eligible Inventory and (xi)
         is not in the Borrower's possession based upon consignment, guaranteed
         sale, or other terms by reason of which the payment by the Borrower may
         be conditional.

          "ENVIRONMENTAL LAWS" means any and all federal, state and local laws,
         regulations, rules, orders, licenses, agreements or other governmental
         restrictions relating to the protection of human health or the
         environment or to emissions, discharges or releases of pollutants or
         industrial, toxic or hazardous substances into the environment, or
         otherwise relating to the manufacture, processing, treatment, transport
         or handling of pollutants or industrial, toxic or hazardous substances.

                                  Page 1 of 20

<PAGE>

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
         amended from time to time, together with all rules and regulations
         promulgated with respect thereto.

         "ERISA AFFILIATE" means with respect to any Person in question, any
         Person that would be treated as a single employer with Borrower.

         "ERISA PLAN" means any pension benefit plan subject to Title IV of
         ERISA maintained by Borrower or any ERISA Affiliate thereof with
         respect to which Borrower or any ERISA Affiliate has a fixed or
         contingent liability.

         "EVENT OF DEFAULT" has the meaning given it in Section 13.

         "FACTOR" means Prestige Capital Corporation, or such other party as may
         enter into Factor Loan Documents with Borrower.

         "FACTOR LOAN DOCUMENTS" means that certain Purchase and Sale Agreement
         and related documents between Factor and Borrower.

         "GAAP" means those generally accepted accounting principles and
         practices which are recognized as such by the Financial Accounting
         Standards Board (or any generally recognized successor), consistently
         applied throughout the period involved.

         "GUARANTORS" means John Gott, Michael Maples and Edward Moist,
         individually, who shall provide validity guarantees.

         "INDEMNIFIED CLAIMS" means any and all claims, demands, actions, causes
         of action, judgments, suits, liabilities, obligations, losses, damages
         and consequential damages, penalties, fines, costs, fees, expenses and
         disbursements (including without limitation, fees and expenses of
         attorneys and other professional consultants and experts in connection
         with any investigation or defense) of every kind or nature, known or
         unknown, existing or hereafter arising, foreseeable or unforeseeable,
         which may be imposed upon, threatened or asserted against or incurred
         or paid by any Indemnified Person at any time and from time to time,
         because of or resulting from, in connection with or in any way relating
         to or arising out of any of the Credit Facilities, the Collateral or
         any other transaction, act, omission, event or circumstance in any way
         connected with or contemplated by this Agreement or the other Loan
         Documents or any action taken or omitted by any such Indemnified Person
         under or in connection with any of the foregoing (including but not
         limited to any investigation, litigation, proceeding, enforcement of
         LENDER's rights or defense of LENDER's actions related to or arising
         out of this Agreement or the other Loan Documents), whether or not any
         Indemnified Person is a party hereto.

         "INDEMNIFIED PERSON" shall collectively mean LENDER and its officers,
         directors, shareholders, employees, attorneys, representatives, agents,
         Affiliates, successors and assigns.

         "INV BORROWING BASE" means an amount equal to the lesser of (a) 50% of
         the Cost of Eligible Inventory or (b) 75% of net forced liquidation
         value of the Eligible Inventory.

         "INV LINE OF CREDIT" has the meaning given it in Section 2.

         "INV LINE OF CREDIT AMOUNT" has the meaning given it in Section 2.

         "LIEN" means any mortgage, lien, pledge, assignment, adverse claim,
         charge, security interest or other encumbrance.

         "LOAN" means the loans made by the LENDER to the Borrower hereunder,
         and other the under the Note and otherwise in connection with the
         Credit Facilities.

                                  Page 2 of 20

<PAGE>

         "LOAN DOCUMENTS" means this Agreement, the Note, and all other
         documents, agreements and instruments now or hereafter required by
         LENDER to be executed and delivered in connection herewith, including,
         without limitation, all documents, agreements and instruments
         evidencing, securing, governing, guaranteeing and/or pertaining to the
         Note and the Credit Facilities.

         "NOTE" has the meaning given it in Section 3.

         "OBLIGATIONS" means any and all loans, advances, debts, liabilities
         (including, without limitation, any and all amounts charged to
         Borrower's account pursuant to any agreement authorizing LENDER to
         charge Borrower's account), obligations, covenants and duties owing by
         Borrower to LENDER of any kind and description (whether advanced
         pursuant to or evidenced by this Agreement, any of the other Loan
         Documents, or any other instrument, or by any other agreement between
         LENDER and Borrower and whether or not for the payment of money),
         whether direct or indirect, absolute or contingent, due or to become
         due, now existing or hereafter arising, whether pursuant to this
         Agreement, as may be amended, modified, extended and/or restated, or
         any of the other Loan Documents, or otherwise, and including, without
         limitation, any debt, liability or obligation owing from Borrower to
         others which LENDER may have obtained by assignment or otherwise, and
         further including, without limitation, all interest not paid when due
         and all costs and expenses which Borrower is required to pay or
         reimburse by this Agreement, by law, or otherwise. All Obligations are
         due and payable in full upon the expiration of the Term or any renewal
         Term, if applicable.

         "OBLIGORS" means Borrower and Guarantors.

         "PERSON" means a corporation, association, partnership, limited
         liability company, organization, business, individual, governmental or
         political subdivision thereof or governmental agency.

         "SUBORDINATED DEBT" means indebtedness owing by Borrower to a creditor
         other than LENDER which has been subordinated and subject in right of
         payment to the prior payment of all indebtedness and obligations now or
         hereafter owing by Borrower to LENDER, such subordination to be
         evidenced by a written agreement between LENDER and the subordinated
         creditor which is in form and substance satisfactory to LENDER.

         "TERM" means one (1) year from the date hereof, but shall be
         automatically renewed for consecutive one (1) year terms unless
         terminated by written notice of either party sixty (60) days prior to
         the end of the initial Term or any renewal Term, which termination
         shall be effective on an anniversary date of this Agreement. Notice of
         such termination shall be effectuated by the mailing of a certified
         letter, return receipt requested, not less than sixty (60) days
         immediately prior to the effective date of such termination, addressed
         to the other party at the address set forth in the opening paragraph of
         this Agreement. A Facility Fee shall be due and payable upon every
         renewal of the Term.

         "TERMINATION EVENT" means (a) the occurrence with respect to any ERISA
         Plan of (i) a reportable event described in Sections 4043(b)(5) of
         ERISA or (ii) any other reportable event described in Section 4043 of
         ERISA other than a reportable event not subject to the provision for
         30-day notice to the Pension Benefit Guaranty Corporation pursuant to a
         waiver by such corporation under Section 4043(a) of ERISA; (b) the

                                  Page 3 of 20

<PAGE>

         withdrawal of Borrower or any Affiliate of Borrower from any ERISA Plan
         during a plan year in which it was a "substantial employer" as defined
         in Section 4001(a)(2) of ERISA; or (c) any event or condition which
         might constitute grounds under Section 4042 of ERISA for the
         termination of, or the appointment of a trustee to administer, any
         ERISA Plan.

2.       CREDIT FACILITIES. Subject to the terms and conditions set forth in
         this Agreement and the other Loan Documents, LENDER hereby agrees to
         provide to Borrower the following Credit Facility or Facilities
         (whether one or more, the "Credit Facilities"):

         (a)      INV Line of Credit. Subject to the terms and conditions set
                  forth herein, LENDER agrees to provide to Borrower a revolving
                  line of credit (the "INV Line of Credit") during the period
                  commencing on the date hereof and continuing through the
                  maturity date of the Note evidencing the INV Line of Credit
                  from time to time or such shorter period as provided herein.
                  Borrower may request advances under the INV Line of Credit
                  from time to time; provided; however, the total principal
                  amount outstanding at any time under the INV Line of Credit
                  shall not exceed the lesser of (i) an amount equal to the INV
                  Borrowing Base, or (ii) $2,000,000.00 (the "INV Line of Credit
                  Amount"). If at any time the aggregate principal amount
                  outstanding under the INV Line of Credit shall exceed an
                  amount equal to the INV Borrowing Base or the INV Line of
                  Credit Amount (an "Over Advance"), LENDER may, in LENDER's
                  sole and absolute discretion, require Borrower to (i)
                  immediately repay to LENDER such excess amount, plus all
                  accrued but unpaid interest thereon, or (ii) furnish LENDER
                  with such additional collateral (i.e., equipment or machinery)
                  that is valued, in LENDER's sole and absolute opinion, at or
                  greater than the excess amount. In the event of the existence
                  of an Over Advance, Borrower shall pay to LENDER, at LENDER's
                  discretion, an Over Advance Fee in the amount of $250.00 for
                  each day that the Over Advance is outstanding. Nothing
                  provided herein shall constitute consent by LENDER to such
                  Over Advance. Borrower may request advances under the INV Line
                  of Credit no more often than once each calendar day. Subject
                  to the terms and conditions set forth in this Agreement and in
                  the Note evidencing the INV Line of Credit from time to time,
                  Borrower may borrow, repay and re-borrow under the INV Line of
                  Credit. The sums advanced under the INV Line of Credit, shall
                  be used for working capital purposes.

3.       PROMISSORY NOTE. Borrower agrees to execute, contemporaneously
         herewith, a promissory note payable to the order of LENDER, in form and
         substance acceptable to LENDER in LENDER's sole and absolute
         discretion, for the Credit Facility provided hereunder to evidence the
         indebtedness owing by Borrower to LENDER under such Credit Facility
         (whether one or more, together with any renewals, extensions and
         increases thereof, the "Notes or Note"). Interest on the Note shall
         accrue at the rate set forth therein. The principal of and interest on
         the Note shall be due and payable and may be prepaid in accordance with
         the terms and conditions set forth in the Note and in this Agreement.
         Subject to the terms of the Note and the other Loan Documents, Borrower

                                  Page 4 of 20

<PAGE>

         may borrow, repay and reborrow thereunder. Notwithstanding the
         foregoing, if Borrower repays any outstanding balance due on the Note
         (in full or in part) and/or the available line is reduced at any time
         during the term of the Loan, LENDER makes no representations and/or
         guarantee to Borrower that funds will be available to Borrower if
         Borrower requests additional or future advances on the line subsequent
         to any repayment or pay down thereof. Borrower agrees to hold LENDER
         harmless in all respects and hereby waives any rights Borrower may have
         under the Note or any of the Loan Documents to pursue an action,
         lawsuit, claim or the like against LENDER in the event that funds are
         unavailable to advance subsequent to a repayment or pay down of any
         portion of the Loan.

4.       COLLATERAL. Borrower hereby grants to LENDER a continuing security
         interest in all presently existing and hereafter acquired or arising
         Collateral in order to secure prompt repayment of any and all
         Obligations owed by Borrower to LENDER and in order to secure prompt
         performance by Borrower of each and all of its covenants and
         obligations under this Agreement, the Loan Documents and otherwise
         created. LENDER's security interest in the Collateral shall attach to
         all Collateral without further act on the part of LENDER or Borrower.
         In the event that any Collateral, including proceeds, is evidenced by
         or consists of negotiable instruments (the "Negotiable Collateral"),
         Borrower shall, immediately upon written request therefore from LENDER,
         endorse and assign such Negotiable Collateral over to LENDER and
         deliver actual physical possession of the Negotiable Collateral to
         LENDER.

         Collateral means and includes the following:

         Accounts Receivable. All of the Borrower's accounts as defined in the
         UCC ("Accounts"); and all of the foregoing, whether or not now owned or
         hereafter created or acquired.

         Inventory. All inventory, goods, merchandise, and other personal
         property now owned or hereafter acquired by the Borrower that are held
         for sale or lease, or are furnished to or to be furnished under any
         contract of services or are finished goods, raw materials,
         work-in-process, supplies, or materials used or consumed in the
         Borrower's business, and all products thereof, and all substitutions,
         replacements, additions, or accessions therefor or thereto.

         Proceeds. All cash and non-cash proceeds of the foregoing, including,
         but not limited to, insurance proceeds, cash, checks, monies on deposit
         in any bank or banks, accounts receivable, instruments, documents
         chattel paper and general intangibles (as such terms are defined in the
         UCC) received by the Borrower on the sale, lease, transfer or
         assignment of the Accounts Receivable and Inventory; provided that this
         provision shall not be construed as a waiver of any restriction
         contained in this Agreement against alienating or encumbering the
         Collateral.

         LENDER may at any time and from time to time, file financing
         statements, continuation statements and amendments thereto that
         describe the Collateral as all assets of the Borrower or words of
         similar effect and which contain any other information required by Part
         5 of Revised Article 9 for the sufficiency or filing office acceptance
         of any financing statement, continuation statement or amendment,
         including whether the Borrower is an organization, the type of
         organization and any organization identification number issued to the
         Borrower. The Borrower agrees to furnish any such information to LENDER
         promptly upon request.

5.       GUARANTORS. As a condition precedent to LENDER's obligation to provide
         the Credit Facilities to Borrower, Borrower agrees to cause the
         Guarantors to each execute and deliver to LENDER contemporaneously
         herewith a guaranty agreement, in form and substance acceptable to
         LENDER in LENDER's sole and absolute discretion.

                                  Page 5 of 20

<PAGE>

6.       FEES.

         a)       Facility Fee. Borrower shall pay to LENDER, concurrently with
                  the initial funding, a facility fee in the amount of
                  $30,000.00. Borrower hereby authorizes LENDER to collect such
                  fee by deducting such fee from the first advance under the
                  subject Credit Facilities. Borrower and LENDER acknowledge and
                  agree that the facility fee is reasonable compensation to
                  LENDER for making the subject Credit Facilities available to
                  Borrower and for no other purpose and are fully earned and
                  non-refundable under any and all circumstances upon initial
                  funding.

         (b)      Monitoring Fee. Borrower agrees to pay LENDER a monitoring fee
                  on the last day of each calendar month during the term of the
                  INV Line of Credit equal to one-half of one percent (.5%) of
                  funds advanced. If the first calendar month covers less than a
                  full month, the monitoring fee shall be prorated for such
                  month. The monitoring fees will be remitted directly from
                  Factor. Borrower and LENDER acknowledge and agree that such
                  fee is reasonable compensation to LENDER for the monitoring
                  and administration of the Credit Facilities. The monitoring
                  fee shall be due for every month, or portion thereof, during
                  the term of this Agreement.

                  The calculation of the monitoring fee will commence with the
                  date that funds are advanced and will end on the date that
                  cleared funds are received including three (3) clearing days
                  for in-state checks and five (5) days for out-of-state checks.

7.       REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
         warrants, and upon each request for an advance under the Credit
         Facilities further represents and warrants, to LENDER as follows:

         (a)      Existence. Borrower is a corporation duly organized, validly
                  existing and in good standing under the laws of the state of
                  its incorporation or organization and is duly licensed,
                  qualified to do business and is in good standing in all other
                  states in which such licensing, qualification and good
                  standing are necessary. Borrower has all requisite power and
                  authority (i) to own and operate its properties, (ii) to carry
                  on its business as now conducted and as proposed to be
                  conducted, and (iii) to execute and deliver this Agreement and
                  the other Loan Documents to which Borrower is a party.

         (b)      Binding Obligations. The execution, delivery, and performance
                  of this Agreement and all of the other Loan Documents by
                  Borrower have been duly authorized by all necessary action by
                  Borrower, have been duly executed and delivered by Borrower
                  and constitute legal, valid and binding obligations of
                  Borrower, enforceable 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.

         (c)      No Consent. The execution, delivery and performance of this
                  Agreement and the other Loan Documents, and the consummation
                  of the transactions contemplated hereby and thereby, do not
                  (i) conflict with, result in a violation of, or constitute a
                  default under (A) any provision of Borrower's articles or
                  certificate of incorporation, articles or certificate of
                  organization, operating agreement, regulations, partnership
                  agreement or bylaws, as the case may be, (B) any law,
                  governmental regulation, court decree or order applicable to
                  Borrower, or (C) any other document or agreement to which
                  Borrower is a party, or (ii) require the consent, approval or
                  authorization of any third party, except for Factor.

                                  Page 6 of 20

<PAGE>

         (d)      Financial Condition. Each financial statement of Borrower
                  supplied to LENDER is true, correct and complete in all
                  material respects and fairly presents Borrower's financial
                  condition in all material respects as of the date of each such
                  statement. There has been no material adverse change in such
                  financial condition or results of operations of Borrower
                  subsequent to the date of the most recent financial statement
                  supplied to LENDER.

         (e)      Litigation. Except for those items disclosed by the Borrower
                  in its public filings with the Securities and Exchange
                  Commission, there are no actions, suits or proceedings,
                  pending or, to the knowledge of Borrower, threatened against
                  or affecting Borrower or the properties of Borrower, before
                  any court or governmental department, commission or board,
                  which, if determined adversely to Borrower, would have a
                  material adverse effect on the business, financial condition,
                  properties, operations or prospects of Borrower.

         (f)      Taxes: Governmental Charges. Borrower has filed all federal,
                  state and local tax reports and returns required by any law or
                  regulation to be filed by it and has either duly paid all
                  taxes, duties and charges indicated due on the basis of such
                  returns and reports, or made adequate provision for the
                  payment thereof, and the assessment of any material amount of
                  additional taxes in excess of those paid and reported is not
                  reasonably expected. There is no tax Lien notice against
                  Borrower or its properties presently on file.

         (g)      ERISA Compliance. Borrower is in compliance with ERISA
                  concerning Borrower's ERISA Plan, if any, or is not required
                  to contribute to any "multi-employer plan" as defined in
                  Section 401 of ERISA.

         (h)      Compliance with Laws. Borrower is conducting its business in
                  material compliance with all statutes, rules, regulations
                  and/or ordinances imposed by any governmental unit upon
                  Borrower or upon its businesses, 'operations and property
                  (including, without limitation, all Environmental Laws).
                  Borrower has all permits and licenses necessary for the
                  operations of its business as presently conducted and as
                  proposed to be conducted.

         (l)      Ownership of Collateral; UCC-1 Financing Statements. Except as
                  held by Factor or otherwise expressly permitted by LENDER,
                  Borrower is the sole owner of the Collateral, free and clear
                  of any and all liens or encumbrances, and will defend the same
                  against all claims and demands of all persons whomsoever. No
                  dispute, right of setoff, counterclaim or defense exists with
                  respect to all or any part of the Collateral. Borrower
                  covenants and agrees that other than those held by Factor
                  there are no UCC-1 Financing Statements filed with the State
                  of Delaware that are or will be superior in lien priority to
                  the UCC-1 Financing Statement(s) LENDER is filing in
                  connection with the Loan.

         (m)      Security Interest. Borrower has and will have at all times
                  full right, power and authority to grant a security interest
                  in the Collateral to LENDER in the manner provided herein,
                  free and clear of any lien, security interest or other charge
                  or encumbrance (other than those in favor of Factor, LENDER or
                  otherwise expressly permitted by LENDER in the other Loan
                  Documents or herein). This Agreement creates a legal, valid
                  and binding security interest in favor of LENDER in the
                  Collateral securing the Obligations.

         (n)      Location. Borrower's residence or chief executive office, as
                  the case may be, and the office where the records concerning
                  the Collateral are kept is located at its address set forth on
                  the signature page hereof. Except as specified elsewhere
                  herein, all Collateral shall be kept at such address and such
                  other addresses as may be approved by LENDER in writing.

                                  Page 7 of 20

<PAGE>

         (o)      Preferred Stock. There are at least three thousand seven
                  hundred and fifty (3750) shares of the Borrower's Series C
                  Preferred Stock (the "Preferred Stock") outstanding, and the
                  majority of the holders of such Preferred Stock have not
                  approved providing collateral to the LENDER other than the
                  Collateral. The Borrower shall not request any such approval
                  for any creditor other than the LENDER without the LENDER's
                  prior written consent. The entering into this Loan Agreement
                  and the Loan Documents is authorized under the terms of the
                  Preferred Stock

         (p)      Use of Collateral. The Borrower shall keep the Collateral in
                  good order and repair and shall protect the Collateral from
                  waste, loss, or damage. The Borrower shall not cause or permit
                  the Collateral to be attached or affixed to real estate in
                  such manner that it will become a fixture. Borrower shall not
                  use or permit the use of the Collateral in violation of any
                  applicable law, statute, ordinance, or regulation. Except for
                  the sale of Inventory in the ordinary course of the Borrower's
                  business, the Borrower shall not remove any collateral from
                  the address set forth below for the giving of notices to the
                  Borrower. Additionally, Borrower shall not be permitted to
                  sell, convey or transfer any of its Inventory to any
                  individual or third party purchaser for cash unless Borrower
                  first obtains LENDER's express written consent and
                  authorization.

         (q)      Liens, Encumbrances, and Taxes. The Borrower shall keep the
                  Collateral free and clear of any and all liens and
                  encumbrances, excepting only the liens in favor of Factor, the
                  lien created by this Agreement and the UCC-1 Financing
                  Statements filed by LENDER herewith or those expressly
                  permitted by LENDER in connection with any other financing
                  relationship acknowledged and approved by LENDER. The Borrower
                  shall pay when due all taxes, fees, or assessments imposed
                  upon or with respect to the Collateral.

                  Borrower (i) will timely pay all property and other taxes,
                  assessments and governmental charges or levies imposed upon
                  the Collateral or any part thereof: (ii) will timely pay all
                  lawful claims which, if unpaid, might become a lien or charge
                  upon the Collateral or any part thereof, and (iii) will
                  maintain appropriate accruals and reserves for all such
                  liabilities in a timely fashion in accordance with generally
                  accepted accounting principles. Borrower may, however, delay
                  paying or discharging any such taxes, assessments, charges,
                  claims or liabilities so long as the validity thereof is
                  contested in good faith by proper proceedings and provided
                  Borrower has set aside on Borrower's books adequate reserves
                  therefor; provided, however, Borrower understands and agrees
                  that in the event of any such delay in payment or discharge
                  and upon LENDER's written request, Borrower will establish
                  with LENDER an escrow acceptable to LENDER adequate to cover
                  the payment of such taxes, assessments and governmental
                  charges with interest, costs and penalties and a reasonable
                  additional sum to cover possible costs, interest and penalties
                  (which escrow shall be returned to Borrower upon payment of
                  such taxes, assessments, governmental charges, interests,
                  costs and penalties or disbursed in accordance with the
                  resolution of the contest to the claimant) or furnish LENDER
                  with an indemnity bond secured by a deposit in cash or other
                  security acceptable to LENDER.

         (r)      Insurance. The Borrower shall keep the Collateral insured at
                  Borrower's sole cost and expense against fire or other
                  casualty in an amount equal to its full insurable value.
                  Borrower shall name LENDER as a loss payee and additional
                  insured as its interests may appear on all such policies, with
                  priority in payment to the LENDER. Such insurance shall be
                  obtained under policies that are acceptable to LENDER in all
                  respects and that are not subject to cancellation or
                  modification by the insurer without at least 10 days' prior
                  written notice to the LENDER. The Borrower shall furnish the

                                  Page 8 of 20

<PAGE>

                  LENDER with such evidence of the Borrower's compliance with
                  this Section as the LENDER may, from time to time, reasonably
                  require. Borrower will also, at the request of LENDER, duly
                  execute and deliver instruments of assignment of such
                  insurance policies and cause the respective insurers to
                  acknowledge notice of such assignment. All insurance payments
                  in respect of loss of or damage to any Collateral shall be
                  paid to LENDER and applied as LENDER in its sole discretion
                  deems appropriate. Notwithstanding the foregoing, all proceeds
                  payable under the insurance policy to LENDER may, upon receipt
                  by LENDER and absent and Event of Default, be applied to
                  repair or replace the damaged and/or affected Collateral. If
                  an Event of Default shall have occurred and is continuing, all
                  such proceeds shall be applied on account of the Obligations
                  owing to LENDER.

         (s)      Possession of Collateral. Until there is a default under the
                  terms of this Agreement, the Borrower may retain possession of
                  the Collateral and may use the Collateral in a manner not
                  inconsistent with this Agreement.

         (t)      Landlords' Agreements, Mortgagee Agreements, Bailee Letters
                  and Real Estate Purchases. If applicable, Borrower shall use
                  commercially reasonable efforts to obtain a landlord's
                  agreement, mortgagee agreement or bailee letter, as
                  applicable, from the lessor of each leased property, mortgagee
                  of owned property or bailee with respect to any warehouse,
                  processor or converter facility or other location where
                  Collateral is stored or located, which agreement or letter
                  shall contain a waiver or subordination of all liens or claims
                  that the landlord, mortgagee or bailee may assert against the
                  Collateral at that location, and shall otherwise be reasonably
                  satisfactory in form and substance to LENDER. After the
                  closing date, no real property or warehouse space shall be
                  leased by Borrower and no Inventory shall be shipped to a
                  processor or converter under arrangements established after
                  the closing date unless a satisfactory landlord agreement or
                  bailee letter, as appropriate, shall first have been obtained
                  with respect to such location. Borrower shall timely and fully
                  pay and perform its obligations under all leases and other
                  agreements with respect to each leased location or public
                  warehouse where any Collateral is or may be located.

         (u)      Further Assurances. Borrower will from time to time at its
                  expense promptly execute and deliver all further instruments
                  and documents and take all further action necessary or
                  appropriate or that LENDER may request in order (i) to perfect
                  and protect the security interest created or purported to be
                  created hereby and the first priority of such security
                  interest, (ii) to enable LENDER to exercise and enforce its
                  rights and remedies hereunder in respect of the Collateral,
                  and (iii) to otherwise effect the purposes of this Agreement,
                  including without limitation: (A) executing and filing such
                  financing or continuation statements, or amendments thereto;
                  and (B) furnishing to LENDER from time to time statements and
                  schedules further identifying and describing the Collateral
                  and such other reports in connection with the Collateral, all
                  in reasonable detail satisfactory to LENDER.

         8.       CONDITIONS PRECEDENT TO ADVANCES. LENDER's obligation to make
                  any advance under this Agreement and the other Loan Documents
                  shall be subject to the conditions precedent that, as of the
                  date of such advance and after giving effect thereto (i) all
                  representations and warranties made to LENDER in this
                  Agreement and the other Loan Documents shall be true and
                  correct, as of and as if made on such date, (ii) no material
                  adverse change in the financial condition of Borrower or its
                  business since the effective date of the most recent financial
                  statements furnished to LENDER by Borrower shall have

                                  Page 9 of 20

<PAGE>

                  occurred, (iii) no Event of Default shall have occurred and no
                  event has occurred and is continuing, or would result from the
                  requested advance, which with notice or lapse of time, or
                  both, would constitute an Event of Default (as hereinafter
                  defined), (iv) LENDER shall have received all Loan Documents
                  appropriately executed by Borrower and all other proper
                  parties and all such Loan Documents are in full force and
                  effect, and (v) LENDER shall have received all fees and
                  expenses owing to LENDER under this Agreement and the other
                  Loan Documents.

9.       AFFIRMATIVE COVENANTS. Until the later to occur of: (i) the Notes and
         all other obligations and liabilities of Borrower under this Agreement
         and the other Loan Documents are fully paid and satisfied, and (ii)
         LENDER has no further commitment to lend hereunder, Borrower agrees and
         covenants that it will, unless LENDER shall otherwise consent in
         writing (which consent may be withheld by LENDER in LENDER's sole and
         absolute discretion):

         (a)      Accounts and Records. Maintain its books and records in
                  accordance with GAAP.

         (b)      Right of Inspection. Permit LENDER to visit its properties and
                  installations and to examine and make and take away copies or
                  reproductions of Borrower's books and records, at all
                  reasonable times. Borrower agrees to pay all costs associated
                  with any such examinations, at a rate equal to $750 per day,
                  per person, plus out-of- pocket expenses.

         (c)      Right to Additional Information. Furnish LENDER with such
                  additional information and statements, lists of assets and
                  liabilities, tax returns, and other reports with respect to
                  Borrower's financial condition and business operations as
                  LENDER may request from time to time.

         (d)      Compliance with Laws. Conduct its business in an orderly and
                  efficient manner consistent with good business practices, and
                  perform and comply with all statutes, rules, regulations
                  and/or ordinances imposed by any governmental unit upon
                  Borrower, its businesses, operations and properties (including
                  without limitation, all Environmental Laws).

         (e)      Taxes. Pay and discharge when due all assessments, taxes,
                  governmental charges and levies, 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 upon any of
                  Borrower's property, income or profits; provided, however,
                  Borrower will not be required to pay and discharge any such
                  assessment, tax, charge, levy or claim so long as (i) same
                  shall be contested in good faith by appropriate judicial,
                  administrative or other legal proceedings timely instituted,
                  (ii) Borrower shall have established adequate reserves with
                  respect to such contested assessment, tax, charge, levy or
                  claim in accordance with GAAP, and deposit such reserves with
                  LENDER, and (iii) the perfection and priority of LENDER's
                  security interest in the Collateral, or the value of the
                  Collateral, is not impaired.

         (f)      Insurance. Maintain, with financially sound and reputable
                  insurers, such insurance as deemed necessary or otherwise
                  required by LENDER, including but not limited to, fire
                  insurance, comprehensive property damage, public liability,
                  worker's compensation and business interruption insurance, in
                  such amounts, with such deductibles and with such carriers as
                  LENDER shall approve. In addition Borrower shall at all times
                  maintain public liability insurance, in such amounts, with
                  such deductibles and with such carriers as LENDER shall
                  approve, naming LENDER as additional insured. Borrower shall
                  also maintain worker's compensation insurance and will
                  provided ELNDER with proof of such coverages. Borrower shall
                  maintain business interruption insurance naming LENDER as loss
                  payee, in such amounts, with such deductibles and with such
                  carriers as LENDER shall approve.

                                  Page 10 of 20

<PAGE>

         (g)      Notice of Material Change/Litigation. Borrower shall promptly
                  notify LENDER in writing (i) of any material adverse change in
                  Borrower's financial condition or its businesses, and (ii) of
                  any litigation or claims against Borrower, which could
                  materially affect Borrower or its business operations,
                  financial condition or prospects.

         (h)      Organizational Existence. Maintain its organizational
                  existence and good standing in the state of its incorporation
                  or organization and its qualification and good standing in all
                  other states where required by applicable law.

         (i)      ERISA. Borrower shall promptly notify LENDER in writing of the
                  adoption or amendment of any plan that results in the
                  representations in Subsection 7(g) no longer being true and
                  correct.

         (j)      Additional Documentation. Execute and deliver, or cause to be
                  executed and delivered, any and all other agreements,
                  instruments or documents which LENDER may reasonably request
                  in order to give effect to the transactions contemplated under
                  this Agreement and the other Loan Documents.

         (k)      Factoring Relationship. Borrower shall be obligated to
                  maintain its factoring relationship with Factor at all times
                  during the term of the Loan and this Agreement. At all times
                  Borrower shall have not less than ninety percent (90%) in
                  dollar volume of its Accounts Receivable collected by the
                  Factor. Borrower's failure to do so shall be deemed an Event
                  of Default wherein LENDER shall have the right to exercise all
                  rights and remedies available to it under this Agreement and
                  the Loan Documents.

         (l)      Consignment Inventory. Borrower has taken all steps necessary,
                  including filing of all necessary UCC-1 financing statements,
                  in order to perfect its ownership of and all other rights in
                  Inventory consigned to third parties, and to protect LENDER's
                  first priority security interest in such consigned Inventory.

10.      NEGATIVE COVENANTS. Until (i) the Notes and all other obligations and
         liabilities of Borrower under this Agreement and the other Loan
         Documents are fully paid and satisfied, and (ii) LENDER has no further
         commitment to lend hereunder, Borrower will not, without the prior
         written consent of LENDER (which consent may be withheld in LENDER's
         sole and absolute discretion):

         (a)      Nature of Business. Make any material change in the nature of
                  its business as carried on as of the date hereof.

         (b)      Liquidations; Mergers; Consolidations; Acquisitions; Name
                  Change. Liquidate, merge or consolidate with or into any other
                  Person, convert from one type of legal entity to another type
                  of legal entity, form or acquire any new subsidiary or acquire
                  by purchase or otherwise all or substantially all of the
                  assets of any other Person, or change its name or operate
                  under any new trade or assumed names.

         (c)      Transactions with 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, upon fair and reasonable terms no less favorable to
                  Borrower than would be obtained in a comparable arm's-length
                  transaction with a person or entity not an Affiliate of
                  Borrower and in accordance with the terms and provisions of
                  the Loan Documents.

                                  Page 11 of 20

<PAGE>

         (d)      Sale of Assets. Sell, lease, transfer or otherwise dispose of
                  all or substantially all of its assets or properties, other
                  than inventory sold in the ordinary course of business and as
                  necessary to replace obsolete equipment.

         (e)      Transfer of Ownership. Permit the sale, pledge or other
                  transfer of any of the ownership interest in Borrower, other
                  than in connection with the conversion, sale, or transfer of
                  the Preferred Stock.
         (f)      Change in Management. Permit a change in the senior management
                  of Borrower.

         (g)      No Disposition of Collateral; Ownership and Liens; Defense.
                  Except for its Inventory, which the Borrower may sell, lease,
                  or otherwise transfer in the ordinary course of the Borrower's
                  business, and except for Borrower's Equipment (including
                  vehicles utilized by Borrower in operating Borrower's
                  business) that is replaced in the ordinary and usual course of
                  Borrower's business with equipment (and vehicles, as
                  applicable) of equal or greater value, Borrower shall not
                  sell, transfer, lease, or otherwise dispose of the Collateral.
                  Borrower will not permit any dispute, right of setoff,
                  counterclaim or defense to exist with respect to all or any
                  part of the Collateral. Borrower will defend, at Borrower's
                  sole cost and expense, LENDER's right, title and security
                  interest in and to the Collateral against the claims of any
                  third party.

         (h)      Goods. Borrower will not permit any Collateral which
                  constitutes goods to at any time (i) be covered by any
                  document except documents in the possession of the LENDER,
                  (ii) become so-related to, attached to or used in connection
                  with any particular real property so as to become a fixture
                  upon such real property, or (ii) be installed in or affixed to
                  other goods so as to become an accession to such other goods
                  unless such other goods are subject to a perfected first
                  priority security interest under this Agreement.

         (i)      Compromise of Collateral. Borrower will not adjust, settle,
                  compromise, amend or modify any Collateral, except an
                  adjustment, settlement, compromise, amendment or modification
                  in good faith and in the ordinary course of business;
                  provided, however, this exception shall automatically
                  terminate upon the occurrence of an Event of Default or upon
                  LENDER's written request Borrower shall provide to LENDER such
                  information concerning (i) any adjustment, settlement,
                  compromise, amendment or modification of any Collateral, and
                  (ii) any claim asserted by any account Borrower for credit,
                  allowance, adjustment, dispute, setoff or counterclaim, as
                  LENDER may request from time to time.

11.      REPORTING REQUIREMENTS. Until (i) the Notes and all other obligations
         and liabilities of Borrower under this Agreement and the other Loan
         Documents are fully paid and satisfied, and (ii) LENDER has no further
         commitment to lend hereunder, Borrower will, unless LENDER shall
         otherwise consent in writing, furnish to LENDER:

         (a)      Financial Statements. The following unaudited financial
                  statements: (i) within 75 days after the last day of each
                  fiscal year of Borrower a consolidated statement of income and
                  a consolidated statement of cash flows of Borrower for such
                  fiscal year, and a consolidated balance sheet of Borrower as
                  of the last day of such fiscal year; (ii) within 30 days after
                  the last day of each fiscal month of Borrower, an unaudited

                                  Page 12 of 20

<PAGE>

                  consolidated statement of income and statement of cash flows
                  of Borrower for such fiscal month, and an unaudited
                  consolidated balance sheet of Borrower as of the last day of
                  such fiscal month (which need not be prepared in accordance
                  with GAAP); and (ii) within 40 days after the last day of each
                  fiscal quarter of Borrower, an unaudited consolidated
                  statement of income and statement of cash flows of Borrower
                  for such fiscal quarter, and an unaudited consolidated balance
                  sheet of Borrower as of the last day of such fiscal quarter.
                  Borrower represents and warrants that each such statement of
                  income and statement of cash flows will fairly present, in all
                  material respects, the results of operations and cash flows of
                  Borrower for the period set forth therein, and that each such
                  balance sheet will fairly present, in all material respects,
                  the financial condition of Borrower as of the date set forth
                  therein, all in accordance with GAAP (other than as provided
                  above), (and subject to year-end review adjustments).

         (b)      Borrowing Base Report. An Advance Request/Borrowing Base
                  Certificate, in the form attached hereto as Schedule A,
                  contemporaneously with each advance requested under the INV
                  Line of Credit and within 3 Business Days after the end of
                  each week, and within 5 Business Days after the end of each
                  month.

         (c)      Inventory Listing. A list of Borrower's inventory by location
                  and type (to include the following: raw materials, work in
                  process and finished goods) within 3 Business Days after the
                  end of each week, and 5 Business Days after the end of each
                  month, in form and detail satisfactory to LENDER.

         (d)      Additional Reporting Requirements. Borrower shall furnish
                  LENDER with the following information:

                  (i)      Monthly Business Financial Statements by the 30th day
                           of the following month.

                  (ii)     Monthly Accounts Payable Aging Reports by the 10th
                           day of the following month.

                  (iii)    Quarterly Payroll Tax Deposit Reports by the 20th day
                           of the following month.

                  (iv)     Annual Business Tax Returns within twenty (20) days
                           after such returns are filed.

                  (v)      Weekly Inventory Summary Reports delivered every
                           Monday during the Term of the Loan containing a
                           detail synopsis and description of the Inventory
                           warehoused by Borrower at the time the report is
                           generated.

                  (vi)     Copies of all filings with state and federal
                           regulatory authorities, upon the filing of such
                           filings.

12.      EVENTS OF DEFAULT. Each of the following shall constitute an "Event of
         Default" under this Agreement and the other Loan Documents:

         (a)      Failure to Pay Indebtedness. Borrower shall fail to pay as and
                  when due any part of the principal of, or interest on, the
                  Notes or any other indebtedness or obligations now or
                  hereafter owing to LENDER by Borrower.

         (b)      Non-Performance of Covenants. Any of the Obligors shall breach
                  any covenant or agreement made herein, in any of the other
                  Loan Documents, or in any other agreement now or hereafter
                  entered into between any of the Obligors and LENDER.

         (c)      False Representation. Any warranty or representation made
                  herein, or in any of the other Loan Documents shall be false
                  or misleading in any material respect when made.

         (d)      Default Under Other Loan Documents. The occurrence of an event
                  of default under any of the other Loan Documents, or any other
                  agreement now or hereafter entered into between any of the
                  Obligors and LENDER.

                                  Page 13 of 20

<PAGE>

         (e)      Untrue Financial Report. Any report, certificate, schedule,
                  financial statement, profit and loss statement or other
                  statement furnished by any Obligor, or by any other person on
                  behalf of any Obligor, to LENDER is not true and correct in
                  any material respect.

         (f)      Default to Third Party. The occurrence of any event which
                  permits the acceleration of the maturity of any indebtedness
                  owing by any of the Obligors to any third party under any
                  agreement or undertaking, including FACTOR.

         (g)      Bankruptcy. The filing of a voluntary or involuntary case by
                  or against any of the Obligors under the United States
                  Bankruptcy Code or other present or future federal or state
                  insolvency, bankruptcy or similar laws, or the appointment of
                  a receiver, trustee, conservator or custodian for a
                  substantial portion of the assets of any of the Obligors.

         (h)      Insolvency. Any of the Obligors shall become insolvent, make a
                  transfer in fraud of creditors or make an assignment for the
                  benefit of creditors.

         (i)      Involuntary Lien. The filing or commencement of any
                  involuntary Lien, garnishment, attachment or the like shall be
                  issued against or with respect to the Collateral.
         (j)      Material Adverse Change. A material adverse change shall have
                  occurred in the financial condition, business prospects or
                  operations of any of the Obligors.

         (k)      Tax Lien. Any of the Obligors shall have a federal or state
                  tax Lien filed against any of its properties.

         (l)      Execution on Collateral. The Collateral or any portion thereof
                  is taken on execution or other process of law.

         (m)      ERISA Plan. Either (i) any "accumulated funding deficiency"
                  (as defined in Section 412(a) of the Internal Revenue Code of
                  1986, as amended) in excess of $25,000 exists with respect to
                  any ERISA Plan of Borrower or its ERISA Affiliate, or (ii) any
                  Termination Event occurs with respect to any ERISA Plan of
                  Borrower or its ERISA Affiliate and the then current value of
                  such ERISA Plan's benefit liabilities exceeds the then current
                  value of such ERISA Plan's assets available for the payment of
                  such benefit liabilities by more than $25,000.

         (n)      Guarantor's Obligations. If any of the obligations of any
                  Guarantor is limited or terminated by operation of law or by
                  such Guarantor, or any such Guarantor becomes the subject of
                  an insolvency proceeding.

         (o)      Judgment. The entry against any of the Obligors of a final and
                  nonappealable judgment for the payment of money in excess of
                  $25,000 (not covered by insurance satisfactory to LENDER in
                  LENDER's sole discretion).

         (p)      Failure to Maintain Factoring Relationship. Borrower failure
                  to maintain its factoring relationship with Factor at all
                  times during the term of the Loan and this Agreement.

         (q)      Loss of or Damage to Collateral. Collateral with a book value
                  of $25,000.00 or more, as determined from the Borrower's
                  books, is lost, destroyed, stolen, or substantially damaged,
                  and such loss, destruction, theft, or damage is not covered by
                  insurance, or the Collateral, or any portion thereof, is
                  voluntarily or involuntarily taken on execution or other
                  process of law.

                                  Page 14 of 20

<PAGE>

         (r)      Foreclosure Suit. Commencement of a foreclosure action or
                  proceeding by any third party against the Collateral if the
                  LENDER reasonably determines that such action or proceeding
                  would jeopardize the security interest created by this
                  Agreement.

         (s)      Entry of Judgment; Involuntary Lien. The entry of a final
                  judgment, order or decree against Borrower for the payment of
                  money in excess of $25,000 that is not covered by insurance
                  satisfactory to LENDER in LENDER's sole and absolute
                  discretion, or the filing or commencement of any involuntary
                  lien, garnishment, attachment or the like shall be issued
                  against or with respect to any of the Collateral.

         (t)      Loss of or Damage to Collateral. Collateral with a book value
                  of $25,000.00 or more, as determined from the Borrower's
                  books, is lost, destroyed, stolen, or substantially damaged,
                  and such loss, destruction, theft, or damage is not covered by
                  insurance, or the Collateral, or any portion thereof, is
                  voluntarily or involuntarily taken on execution or other
                  process of law.

         Nothing contained in this Loan Agreement shall be construed to limit
         the events of default enumerated in any of the other Loan Documents and
         all such events of default shall be cumulative.

13. REMEDIES.

         Upon the occurrence of an Event of Default by Borrower under this
Agreement, LENDER may, at its election, without notice of its election and
without demand, do any one or more of the following, all of which are authorized
by Borrower:

         A. Declare all Obligations, whether arising pursuant to this Agreement
or otherwise, immediately due and payable;

         B. Cease advancing money or extending credit to or for the benefit of
Borrower under this Agreement or under any other agreement between Borrower and
LENDER;

         C. Terminate this Agreement and any of the other Loan Documents as to
any future liability or obligation of LENDER, but without affecting LENDER's
rights and security interest in the Collateral and without affecting the
Obligations owing by Borrower to LENDER;

         D. LENDER or LENDER's designee may notify customers, account debtors or
lessees of Borrower that the Accounts have been assigned to LENDER and that
LENDER has a security interest therein, collect them directly, and charge the
reasonable collection costs and expenses to Borrower's loan account;

                                  Page 15 of 20

<PAGE>

         E. Without notice to or demand upon Borrower or any Guarantor, make
such payments and do such acts as LENDER considers necessary or reasonable to
protect its security interest in the Collateral. Borrower agrees to assemble the
Collateral if LENDER so requires, and to make the Collateral available to LENDER
as LENDER may designate. Borrower authorizes LENDER to enter the premises where
the Collateral is located, take and maintain possession of the Collateral, or
any part of it, and to pay, purchase, contest or compromise any encumbrance,
charge or lien which in the opinion of LENDER appears to be prior or superior to
its security interest and to pay all expenses incurred in connection therewith;

         F. LENDER is hereby granted a license or other right to use, without
charge, Borrower's labels, patents, copyrights, rights of use of any name, trade
secrets, trade names, trademarks and advertising matter, or any property of a
similar nature, as it pertains to the Collateral, in completing production of,
advertising for sale and selling any Collateral and Borrower's rights under all
licenses, and all franchise agreements shall insure to LENDER's benefit;

         G. Ship, reclaim, recover, store, finish, maintain, repair, prepare for
sale, advertise for sale and sell (in the manner provided for herein) the
Collateral;

         H. Sell the Collateral at either a public or private sale, or both, by
way of one or more contracts or transactions, for cash or on terms. It is not
necessary that the Collateral be present at any such sale;

         I. In connection with any such sale, the standard of commercial
reasonableness will be deemed satisfied if LENDER does the following:

         (i)      Location of Sale(s). The sale(s) may be conducted at
                  Borrower's premises, LENDER's premises, the premises of any
                  third party located in or adjacent to any county in which any
                  of the collateral is located, or any other location which
                  LENDER believes is reasonably convenient to potential
                  purchasers. The selection of any such location(s) shall be in
                  the sole and absolute discretion of LENDER.

                                  Page 16 of 20

<PAGE>

         (ii)     Notice of Sale. LENDER shall give notice of the disposition of
                  the Collateral as follows:

                  (a)      LENDER shall give Borrower and each holder of a
                           security interest in the Collateral who has filed
                           with LENDER a written request for notice, a notice in
                           writing of the time and place of public sale, or, if
                           the sale is a private sale or some other disposition
                           other than a public sale is to be made of the
                           Collateral, the time on or after which the private
                           sale or other disposition is to be made;

                  (b)      The notice shall be personally delivered or mailed,
                           postage prepaid, to Borrower as provided in Section
                           17, at least ten (10) calendar days before the date
                           fixed for the sale, or at least ten (10) calendar
                           days before the date on or after which the private
                           sale or other disposition is to be made, unless the
                           Collateral is perishable or threatens to decline
                           speedily in value. Notice to persons other than
                           Borrower claiming an interest in the Collateral shall
                           be sent to such addresses as they have furnished to
                           LENDER;

                  (c)      If the sale is to be a public sale, LENDER shall also
                           give notice of the time and place by publishing a
                           notice one time at least ten (10) calendar days
                           before the date of the sale in a newspaper of general
                           circulation in the county in which the sale is to be
                           held;

         J. LENDER may credit bid and purchase at any public sale;

         K. If LENDER sells any of the Collateral upon Credit, Borrower will be
credited only with payments actually made by the purchaser, received by LENDER
and applied to the indebtedness of the purchaser. In the event the purchaser
fails to pay for the Collateral, LENDER may resell the Collateral and Borrower
shall be credited with the net proceeds of sale.

         L. Borrower shall pay all reasonable LENDER Expenses incurred in
connection with LENDER's enforcement and exercise of any of its rights and
remedies as herein provided, whether or not suit is commenced by LENDER;

         M. Any deficiency which exists after disposition of the Collateral as
provided above will be paid immediately by Borrower. Any excess will be
returned, without interest and subject to the rights of third parties, to
Borrower by LENDER.

                                  Page 17 of 20

<PAGE>

         LENDER's rights and remedies under this Agreement and all other
         agreements shall be cumulative. LENDER shall have all other rights and
         remedies not inconsistent herewith as provided under the UCC, by law,
         or in equity. No exercise by LENDER of one right or remedy shall be
         deemed an election, and no waiver by LENDER of any default on
         Borrower's part shall be deemed a continuing waiver. No delay by LENDER
         shall constitute a waiver, election or acquiescence by it.

14.      INDEMNIFICATION. Borrower hereby indemnifies and agrees to hold
         harmless and defend all Indemnified Persons from and against any and
         all Indemnified Claims. THE FOREGOING INDEMNIFICATION SHALL APPLY
         WHETHER OR NOT SUCH INDEMNIFIED CLAIMS ARE IN ANY WAY OR TO ANY EXTENT
         OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM OR THEORY OF STRICT
         LIABILITY, OR ARE CAUSED, IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR
         OMISSION OF ANY INDEMNIFIED PERSON, but shall exclude any of the
         foregoing resulting from such Indemnified Person's gross negligence or
         willful misconduct. If Borrower or any third party ever alleges any
         gross negligence or willful misconduct by any Indemnified Person, the
         indemnification provided for in this Section shall nonetheless be paid
         upon demand, subject to later adjustment or reimbursement, until such
         time as a court of competent jurisdiction enters a final judgment as to
         the extent and affect of the alleged gross negligence or willful
         misconduct. Upon notification and demand, Borrower agrees to provide
         defense of any Indemnified Claim and to pay all costs and expenses of
         counsel selected by any Indemnified Person in respect thereof. Any
         Indemnified Person against whom any Indemnified Claim may be asserted
         reserves the right to settle or compromise any such Indemnified Claim
         as such Indemnified Person may determine in its sole discretion, and
         the obligations of such Indemnified Person, if any, pursuant to any
         such settlement or compromise shall be deemed included within the
         Indemnified Claims. Except as specifically provided in this Section,
         Borrower waives all notices from any Indemnified Person. The provisions
         of this Section shall survive the termination of this Agreement.

15.      RIGHTS CUMULATIVE. All rights of LENDER under the terms of this
         Agreement shall be cumulative of, and in addition to, the rights of
         LENDER under any and all other agreements between Borrower and LENDER
         (including, but not limited to, the other Loan Documents), and not in
         substitution or diminution of any rights now or hereafter held by
         LENDER under the terms of any other agreement.

16.      WAIVER AND AGREEMENT. Neither the failure nor any delay on the part of
         LENDER to exercise any right, power or privilege herein or under any of
         the other Loan Documents shall operate as a waiver thereof, nor shall
         any single or partial exercise of such right, power or privilege
         preclude any other or further exercise thereof or the exercise of any
         other right, power or privilege. No waiver of any provision in this
         Loan Agreement or in any of the other Loan Documents and no departure
         by Borrower therefrom shall be effective unless the same shall be in
         writing and signed by LENDER, and then shall be effective only in the
         specific instance and for the purpose for which given and to the extent
         specified in such writing. No modification or amendment to this Loan
         Agreement or to any of the other Loan Documents shall be valid or
         effective unless the same is signed by the party against whom it is
         sought to be enforced.

17.      BENEFITS AND TERM. This Agreement shall be binding upon and inure to
         the benefit of LENDER and Borrower, and their respective successors and
         assigns; provided, however, that Borrower may not, without the prior
         written consent of LENDER, assign any rights, powers, duties or
         obligations under this Agreement or any of the other Loan Documents.

18.      NOTICES. All notices, requests, demands or other communications
         required or permitted to be given pursuant to this Agreement shall be
         in writing and given by (i) personal delivery, (ii) expedited delivery
         service with proof of delivery, (iii) United States mail, postage
         prepaid, registered or certified mail, return receipt requested, or

                                  Page 18 of 20

<PAGE>

         (iv) telecopy (with receipt thereof confirmed by telecopier) sent to
         the intended addressee at the address set forth on the signature page
         hereof and shall be deemed to have been received either, in the case of
         personal delivery, as of the time of personal delivery, in the case of
         expedited delivery service, as of the date of first attempted delivery
         at the address and in the manner provided herein, in the case of mail,
         three (3) days after deposit in a depository receptacle under the care
         and custody of the United States Postal Service, or in the case of
         telecopy, upon receipt. Either party shall have the right to change its
         address for notice hereunder to any other location within the
         continental United States by notice to the other party of such new
         address at least thirty (30) days prior to the effective date of such
         new address.

19.      GOVERNING LAW, VENUE, SUBMISSION TO JURISDICTION. THIS AGREEMENT AND
         THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN
         ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA WITHOUT GIVING EFFECT
         TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF, EXCEPT TO THE EXTENT
         PERFECTION AND THE EFFECT OF PERFECTION OR NON- PERFECTION OF THE
         SECURITY INTEREST GRANTED HEREUNDER OR THEREUNDER, IN RESPECT OF ANY
         PARTICULAR COLLATERAL, ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
         THAN THE STATE OF FLORIDA. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
         ARE PERFORMABLE BY THE PARTIES IN PALM BEACH COUNTY, FLORIDA. BORROWER
         AND LENDER EACH AGREE THAT PALM BEACH COUNTY, FLORIDA, SHALL BE THE
         EXCLUSIVE VENUE FOR LITIGATION OF ANY DISPUTE OR CLAIM ARISING UNDER OR
         RELATING TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AND THAT SUCH
         COUNTY IS A CONVENIENT FORUM IN WHICH TO DECIDE ANY SUCH DISPUTE OR
         CLAIM. BORROWER AND LENDER EACH CONSENT TO THE PERSONAL JURISDICTION OF
         THE STATE AND FEDERAL COURTS LOCATED IN PALM BEACH COUNTY, FLORIDA FOR
         THE LITIGATION OF ANY SUCH DISPUTE OR CLAIM. BORROWER IRREVOCABLY
         WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT
         MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH
         PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH
         PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT
         FORUM.

20.      WAIVER OF JURY TRIAL. BORROWER AND LENDER EACH HEREBY IRREVOCABLY
         WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY RIGHT IT MAY HAVE
         TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY
         AT ANY TIME ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT
         OR ANY TRANSACTION CONTEMPLATED HEREBY OR ASSOCIATED HEREWITH.

21.      INVALID PROVISIONS. If any provision of this Agreement or any of the
         other Loan Documents is held to be illegal, invalid or unenforceable
         under present or future laws, such provision shall be fully severable
         and the remaining provisions of this Agreement or any of the other Loan
         Documents shall remain in full force and effect and shall not be
         affected by the illegal, invalid or unenforceable provision or by its
         severance.

22.      EXPENSES. Borrower shall pay all costs and expenses (including, without
         limitation, reasonable attorneys' fees) in connection with (i) the
         preparation of the Loan Documents, (ii) any action required in the
         course of administration of the indebtedness and obligations evidenced
         by the Loan Documents, (iii) any action in the enforcement of LENDER's
         rights upon the occurrence of Event of Default and (iv) all expenses
         incurred or paid by LENDER for purposes of conserving and protecting
         the Collateral, including, but not limited to, reasonable attorney's
         fees and other legal expenses incurred in connection with retaking,
         holding, preparing for sale, and selling the Collateral.

                                  Page 19 of 20

<PAGE>

23.      PARTICIPATION OF THE CREDIT FACILITIES. Borrower agrees that LENDER
         may, at its option, sell interests in any of the Credit Facilities and
         its rights under this Agreement and the other Loan Documents and, in
         connection with each such sale, LENDER may disclose any financial and
         other information available to LENDER concerning Borrower to each
         prospective purchaser and assignee.

24.      CONFLICTS. In the event any term or provision hereof is inconsistent
         with or conflicts with any provision of the other Loan Documents
         between Borrower and LENDER, LENDER shall determine, in LENDER'S sole
         and absolute discretion, the terms and provisions that it wishes to
         govern the relationship of the parties.

25.      COUNTERPARTS. This Agreement may be separately executed in any number
         of counterparts, each of which shall be an original, but all of which,
         taken together, shall be deemed to constitute one and the same
         instrument. Delivery of an executed counterpart of this Agreement by
         telecopy shall be equally as effective as delivery of a manually
         executed counterpart of this Agreement. Any party delivering an
         executed counterpart of this Agreement by telecopy also shall deliver a
         manually executed counterpart of this Agreement but the failure to
         deliver a manually executed counterpart shall not affect the validity,
         enforceability, and binding effect of this Agreement.

26.      COMPLIANCE. Borrower agrees, if requested by LENDER or its counsel, to
         fully cooperate and adjust for clerical errors (including the payment
         of any amounts due) in any or all loan closing documentation if deemed
         necessary or desirable in the reasonable discretion of LENDER for any
         reason or purpose whatsoever in order to ensure LENDER has a complete
         and accurately documented loan file. Further, Borrower does hereby so
         agree and covenant in order to assure that the loan documentation
         executed this date will conform and be acceptable in the marketplace in
         the instance of transfer, sale or conveyance by LENDER of its interest
         in and to said loan documentation or to otherwise reasonably comply
         with LENDER's loan requirements. The provisions of this Section shall
         survive termination of this Agreement.

27.      ENTIRE AGREEMENT. THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS
         REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO WITH RESPECT
         TO THE TRANSACTIONS CONTEMPLATED HEREIN AND MAY NOT BE CONTRADICTED BY
         EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF
         THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
         PARTIES. THIS AGREEMENT ALSO AMENDS AND SUPERSEDES ANY OF THE TERMS OF
         ANY PRIOR WRITTEN AGREEMENTS WITH RESPECT TO THE MATTERS SET FORTH IN
         THIS AGREEMENT.

EXECUTED as of the date first above written.

LENDER:                                              BORROWER:

Capital Growth Asset Based Bridge Loan Fund          SLS International, Inc., a
II, LLC, a Florida limited liability company         Delaware corporation

By: Crossroads Collateral Management
Fund, LLC, its managing member

By:                                                  By:
   -------------------------                            ------------------------
                                                        Name:
Name:                                                   Title:
     -----------------------

Title:
      ------------------------

                                  Page 20 of 20

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00108-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00108-of-00352.parquet"}]]