Document:

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                               SECURITY AGREEMENT

         THIS SECURITY AGREEMENT (as amended, supplemented, amended and restated
or otherwise modified from time to time, this "Security Agreement"), dated as of
June 30, 2000, is made by LANCER PARTNERSHIP, LTD., a Texas limited partnership
("Grantor"), in favor of THE FROST NATIONAL BANK, a national banking
association, as agent (in such capacity, the "Agent") for each of the Banks
under the Credit Agreement (as defined below).

                                   WITNESSETH:

         WHEREAS, pursuant to that certain Seventh Amendment and Restated Credit
Agreement, dated as of the date hereof (as modified, amended, supplemented, or
restated from time to time, the "Credit Agreement"), among Grantor, LANCER DE
MEXICO, S.A. DE C.V., formerly known as NUEVA DISTRIBUIDORA LANCERMEX, S.A. de
C.V., a sociedad anonima de capital variable organized under the laws of the
United Mexican States ("Mexico Subsidiary") (Grantor and Mexico Subsidiary being
hereinafter collectively referred to as "Borrower"), Lancer Corporation, a Texas
corporation, Lancer Capital Corporation, a Delaware corporation, Lancer
International Sales, Inc., a Texas corporation, Servicios Lancermex, S.A. de
C.V., a sociedad anonima de capital variable organized under the laws of the
United Mexican States, Industrias Lancermex, S.A. de C.V., a sociedad anonima de
capital variable organized under the laws of the United Mexican States and The
Frost National Bank, individually and as Agent, Harris Trust and Savings Bank,
an Illinois banking corporation, individually, and Whitney National Bank, a
national banking association, individually, and each of the lenders that are now
or hereafter parties thereto, and certain other financial institutions who from
time to time are parties thereto (the "Banks"), the Banks have extended
Commitments to make Loans to Borrower;

         WHEREAS, as a condition precedent to the making of loans by the Banks
under the Credit Agreement, the Grantor is required to execute and deliver this
Security Agreement;

         WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Security Agreement;

         NOW, THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, and in order to induce the Banks to extend the
Commitments to the Borrower pursuant to the Credit Agreement, the Grantor
agrees, for the benefit of each of the Banks, as follows:

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                                    ARTICLE I

                                   DEFINITIONS

         SECTION 1.1. CERTAIN TERMS. The following terms when used in this
Security Agreement, including its preamble and recitals, shall have the
following meanings (such definitions to be equally applicable to the singular
and plural forms thereof):

         "Collateral" is defined in Section 2.1.

         "Collateral Account" is defined in Section 6.2.

         "Deposit Accounts" is defined in clause (t) of Section 2.1.

         "Equipment" is defined in clause (a) of Section 2.1.

         "Event of Default" means the occurrence of any of the following events
or conditions:

                  (a) An Event of Default under the Credit Agreement shall occur
                  and be continuing;

                  (b) The failure to pay, when due, any portion of the Secured
                  Indebtedness, subject to applicable notice and cure periods,
                  if any;

                  (c) The failure of Grantor to observe any of the terms,
                  conditions or covenants contained in this Security Agreement,
                  subject to applicable notice and cure periods, if any; or

                  (d) The ownership of the Collateral or any of the Collateral,
                  except for Inventory sold in the ordinary course of business
                  or as permitted under Section 4.1.3 hereof, or any legal or
                  equitable interest therein, becomes vested in a person or
                  entity other than Grantor.

         "Inventory" is defined in clause (b) of Section 2.1.

         "Lender Party" means, as the context may require, Agent, each Bank, and
each of their respective successors, transferees and assigns.

         "Receivables" is defined in clause (c) of Section 2.1.

         "Related Contracts" is defined in clause (c) of Section 2.1.

         "Secured Indebtedness" is defined in Section 2.2.

         "Third Party" is defined in clause (a) of Section 3.1.3.

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         "U.C.C." means the Uniform Commercial Code, as in effect in the State
of Texas.

         SECTION 1.2. CREDIT AGREEMENT DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, terms used in this Security Agreement,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.

         SECTION 1.3. U.C.C. DEFINITIONS. Unless otherwise defined herein or the
context otherwise requires, terms for which meanings are provided in the U.C.C.
are used in this Security Agreement, including its preamble and recitals, with
such meanings.

                                   ARTICLE II

                                SECURITY INTEREST

         SECTION 2.1. GRANT OF SECURITY. Grantor hereby assigns and pledges to
Agent for its benefit and the benefit of each of the Banks, and hereby grants to
Agent, for its benefit and the benefit of each of the Banks, a security interest
in all of the following, whether now or hereafter existing or acquired (the
"Collateral"):

                  (a) all equipment in all of its forms of Grantor, wherever
         located, including all machinery, manufacturing, distribution, selling,
         data processing and office equipment, assembly systems, tools, molds,
         dies, fixtures, appliances, furniture, furnishings, vehicles, trade
         fixtures, and other tangible personal property (other than Inventory),
         and all parts thereof and all accessions, additions, attachments,
         improvements, substitutions and replacements thereto and therefor (any
         and all of the foregoing being the "Equipment");

                  (b) all inventory in all of its forms of Grantor, wherever
         located, including:

                           (i) all goods, merchandise and other personal
                  property furnished or to be furnished under any contract of
                  service or intended for sale or lease, all consigned goods and
                  other items which have previously constituted Equipment but
                  are then currently being held for sale or lease in the
                  ordinary course of Grantor's business, all raw materials and
                  work in process therefor, finished goods thereof, and all
                  other materials and supplies of any kind, nature or
                  description used or consumed in the manufacture, production,
                  packing, shipping, advertising, finishing or sale thereof;

                           (ii) all goods in which Grantor has an interest in
                  mass or a joint or other interest or right of any kind
                  (including goods in which Grantor has an interest or right as
                  consignee); and

                           (iii) all goods which are returned to or repossessed
                  by Grantor;

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         and all accessions thereto, products thereof and documents therefore
         (any and all such inventory, materials, goods, accessions, products and
         documents being the "Inventory");

                  (c) all accounts, contracts, contract rights, chattel paper,
         documents, instruments and general intangibles of Grantor, whether or
         not arising out of or in connection with the sale or lease or other
         disposition of goods or the rendering of services, and all rights of
         Grantor now or hereafter existing in and to all security agreements,
         guaranties, leases and other contracts securing or otherwise relating
         to any such accounts, contracts, contract rights, chattel paper,
         documents and instruments (any and all such accounts, contracts,
         contract rights, chattel paper, documents, instruments, and general
         intangibles being the "ReceivableS", and any and all such security
         agreements, guaranties, leases and other contracts being the "Related
         Contracts");

                  (d) Intentionally Omitted;

                  (e) all contracts, contract rights and general intangibles of
         Grantor, including without limitation, all tax refunds, claims, causes
         of action, judgments, franchises, permits, licenses, supply contracts,
         purchase contracts, and agreements (collectively, "General
         Intangibles");

                  (f) all of Grantor's right, title and interest in and to any
         and all depository, savings, or custodial, or other accounts maintained
         by Grantor with any of the Banks, all sums now or at any time hereafter
         on deposit therein, credited thereto, or payable thereon and all
         instruments, documents and other writings evidencing any of the
         foregoing accounts (such accounts collectively referred to herein as
         the "Deposit Accounts");

                  (g) all investment property of Grantor;

                  (h) all books, records, writings, data bases, information and
         other property relating to, used or useful in connection with,
         evidencing, embodying, incorporating or referring to, any of the
         foregoing in this Section 2.1.;

                  (i) all of Grantor's other property and rights of every kind
         and description and interests therein; and

                  (j) all products, offspring, rents, issues, profits, returns,
         income and proceeds of and from any and all of the foregoing Collateral
         (including proceeds which constitute property of the types described in
         clauses (a), (b), (c), (d), (e), (f), (g), (h), and (i), proceeds
         deposited from time to time in the Deposit Accounts and in any lock
         boxes of Grantor, and, to the extent not otherwise included, all
         payments under insurance (whether or not Agent is the loss payee
         thereof), or any indemnity, warranty or guaranty, payable by reason of
         loss or damage to or otherwise with respect to any of the foregoing
         Collateral.

Notwithstanding the foregoing, "Collateral" shall not include any General
Intangibles as to which, or other rights arising under contracts as to which,
the grant of a security interest would constitute a

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violation of a valid and enforceable restriction on such grant, unless and until
any required consents shall have been obtained. Grantor agrees to use its best
efforts to obtain any such required consent.

         SECTION 2.2. SECURITY FOR THE OBLIGATION. This Security Agreement
secures the payment and performance of the Obligation, including, without
limitation, all obligations now or hereafter existing under the Credit
Agreement, the Notes, this Security Agreement and each of the other Loan
Documents to which Grantor is or may become a party, whether for principal,
interest, costs, fees, expenses or otherwise (including all such amounts which
would become due but for the operation of the automatic stay under Section
362(a) of the United States Bankruptcy Code, 11 U.S.C. Section 362(a), and the
operation of Sections 502(b) and 506(b) of the United States Bankruptcy Code, 11
U.S.C. Sections 502(b) and 506(b)) (all of the foregoing, together with all
renewals, extensions and modifications of all or any part thereof, being the
"Secured Indebtedness").

         SECTION 2.3. CONTINUING SECURITY INTEREST; TRANSFER OF NOTES. This
Security Agreement shall create a continuing security interest in the Collateral
and shall:

                  (a) remain in full force and effect until payment in full of
         the Secured Indebtedness and the termination of all Commitments;

                  (b) be binding upon Grantor, its successors, transferees and
         assigns; and

                  (c) inure, together with the rights and remedies of Agent
         hereunder, to the benefit of Agent and each other Lender Party.

Without limiting the generality of the foregoing clause (c), any Lender Party
may assign or otherwise transfer (in whole or in part) any note held by it to
any other Person or entity, and such other Person or entity shall thereupon
become vested with all the rights and benefits in respect thereof granted to
such Lender Party under any Loan Document (including this Security Agreement),
or otherwise, subject, however, to any contrary provisions in such assignment or
transfer, and to the provisions of the Credit Agreement. Upon the payment in
full of the Secured Indebtedness and the termination of all Commitments, the
security interest granted herein shall terminate and all rights to the
Collateral shall revert to Grantor. Upon any such termination, Agent will, at
Grantor's sole expense, execute and deliver to Grantor such documents as Grantor
shall reasonably request to evidence such termination.

         SECTION 2.4. GRANTOR REMAINS LIABLE. Anything herein to the contrary
notwithstanding:

                  (a) Grantor shall remain liable under the contracts and
         agreements included in the Collateral to the extent set forth therein,
         and shall perform all of its duties and obligations under such
         contracts and agreements to the same extent as if this Security
         Agreement had not been executed;

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                  (b) the exercise by Agent of any of its rights hereunder shall
         not release Grantor from any of its duties or obligations under any
         such contracts or agreements included in the Collateral; and

                  (c) neither Agent nor any other Lender Party shall have any
         obligation or liability under any such contracts or agreements included
         in the Collateral by reason of this Security Agreement, nor shall Agent
         or any other Lender Party be obligated to perform any of the
         obligations or duties of Grantor thereunder or to take any action to
         collect or enforce any claim for payment assigned hereunder.

                                   ARTICLE III

                         REPRESENTATIONS AND WARRANTIES

         SECTION 3.1. REPRESENTATIONS AND WARRANTIES. Grantor hereby represents
and warrants unto each Lender Party as set forth in this Article.

         SECTION 3.1.1. LOCATION OF COLLATERAL, ETC. All of the Equipment and
Inventory of Grantor is located at the places specified in ITEM A of SCHEDULE I
hereto, except for Inventory in transit in the ordinary course of Grantor's
business; provided, however, that Inventory and Equipment may be moved to other
locations in accordance with clause (a) of Section 4.1.1. All of the Inventory
which is imported from a location outside the United States arrives at one of
the ports or locations specified in ITEM A of SCHEDULE I hereto. None of the
Equipment and Inventory has, within the four months preceding the date of this
Security Agreement, been located at any place other than the places specified in
ITEM A of SCHEDULE I hereto. Each location of Equipment or Inventory which is
subject to a lease, sublease, mortgage or similar instrument is described as
such in ITEM A of SCHEDULE I hereto and Grantor shall, upon the request of Agent
provide Agent with the name and address of each lessor, sublessor, lessee,
sublessee and/or mortgagee (other than Grantor) with respect to any or all such
locations. All of the lock boxes of Grantor are located at the places specified
in ITEM B of SCHEDULE I hereto. The place(s) of business and chief executive
office of Grantor and the office(s) where Grantor keeps its records concerning
the Receivables, are located at the addresses specified in ITEM C of SCHEDULE I
hereto. Except as set forth on ITEM D of SCHEDULE I hereto, Grantor has no trade
names. Grantor has not been known by any legal name different from the one set
forth on the signature page hereto. Except as previously disclosed to Agent in
writing, Grantor has not been the subject of any merger or other corporate
reorganization. Grantor is not a party to any Federal, state or local government
contract.

         SECTION 3.1.2. OWNERSHIP, NO LIENS, ETC. Grantor has good and
marketable title to the Collateral and Grantor is the legal and beneficial owner
of the Collateral and owns the Collateral free and clear of any Lien, security
interest, charge or encumbrance except for the security interest created by this
Security Agreement and except as permitted by the Credit Agreement. No effective
financing statement or other instrument similar in effect covering all or any
part of the Collateral is on file in any recording office, except such as may
have been filed in favor of Agent relating to this Security Agreement, and
except as permitted by the Credit Agreement.

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         SECTION 3.1.3.  POSSESSION AND CONTROL.

                  (a) The name and address of each bailee, processor,
         warehouseman, consignee or other Person in possession of any of the
         Inventory or Equipment (each such Person being a "Third Party") on the
         date hereof, other than carriers and shippers of Inventory in transit
         in the ordinary course of Grantor's business, is set forth in ITEM A of
         SCHEDULE I hereto, together with the address of the location where such
         Inventory or Equipment is or may be held. Except as otherwise indicated
         in ITEM A of SCHEDULE I hereto, no Person (other than a Person
         identified in ITEM A of SCHEDULE I thereto as being a consignee) in
         possession of any of the Inventory or Equipment conducts a business at
         the location of such Inventory or Equipment other than a business in
         the nature of warehousing or transporting goods for others. In the
         event that any Inventory is in the possession of a Third Party, such
         Inventory is not evidenced by a negotiable instrument or document.

                  (b) Except as indicated in clause (a) of this Section, Grantor
         has exclusive possession and control of the Equipment and Inventory.

         SECTION 3.1.4. NEGOTIABLE DOCUMENTS, INSTRUMENTS AND CHATTEL PAPER.
Grantor has, contemporaneously herewith, delivered to Agent possession of all
originals of all negotiable documents, instruments and chattel paper currently
owned or held by Grantor (duly endorsed in blank, if requested by Agent).

         SECTION 3.1.6. VALIDITY, ETC. This Security Agreement creates a valid
security interest in the Collateral, securing the payment of the Secured
Indebtedness, which security interest is a first priority security interest in
the Collateral except to the extent previously disclosed to Agent in writing,
and all filings and other actions necessary or desirable to perfect and protect
such security interest will be duly made or taken.

         SECTION 3.1.7. AUTHORIZATION, APPROVAL, ETC. No authorization, approval
or other action by, and no notice to or filing with, any governmental authority
or regulatory body is required either:

                  (a) for the grant by Grantor of the security interest granted
         hereby or for the execution, delivery and performance of this Security
         Agreement by Grantor; or

                  (b) for the filing required for perfection of or the exercise
         by Agent of its rights and remedies hereunder.

         SECTION 3.1.8. COMPLIANCE WITH LAWS. Grantor is in compliance with the
requirements of all applicable laws (including, without limitation, the
provisions of the Fair Labor Standards Act), rules, regulations and orders of
every Governmental Authority, the non-compliance with which might materially
adversely affect the business, properties, assets, operations, condition
(financial or otherwise) or prospects of Grantor or the value of the Collateral
or the worth of the Collateral as collateral security.

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         SECTION 3.1.9. TAXES. All taxes, assessments and other charges levied
against the Collateral have been paid in full, other than taxes, assessments and
charges not yet due and payable.

                                   ARTICLE IV

                                   COVENANTS

         SECTION 4.1. CERTAIN COVENANTS. Grantor covenants and agrees that, so
long as any portion of the Secured Indebtedness shall remain unpaid, and until
the termination of the Commitments, Grantor will, unless the Required Banks
under the Credit Agreement shall otherwise consent in writing, perform the
obligations set forth in this Section.

         SECTION 4.1.1. AS TO EQUIPMENT AND INVENTORY. Grantor hereby agrees
that it shall:

                  (a) keep all the Equipment and Inventory (other than Inventory
         in transit and Inventory sold in the ordinary course of business) at
         the places therefor specified in Section 3.1.1 or, upon 30 days' prior
         written notice to Agent, at such other places in a jurisdiction where
         all representations and warranties set forth in Article III (including
         Section 3.1.6) shall be true and correct, and all action required
         pursuant to the first sentence of Section 4.1.7 shall have been taken
         with respect to the Equipment and Inventory;

                   (b) with respect to any Equipment or Inventory in the
         possession or control of any Third Party or any of Grantor's agents,
         notify such Third Party or agent of Agent's security interest in such
         Equipment or Inventory and, upon Agent's request following the
         occurrence and during the continuance of an Event of Default, direct
         such Third Party or agent to hold all such Equipment or Inventory for
         Agent's account and subject to Agent's instructions;

                   (c) cause the Equipment to be maintained and preserved in the
         same condition, repair and working order as when new, ordinary wear and
         tear excepted, and in accordance with any manufacturer's manual; and
         forthwith, or in the case of any material loss or damage to any of the
         Equipment, as quickly as practicable after the occurrence thereof, make
         or cause to be made all repairs, replacements, and other improvements
         in connection therewith which are necessary or desirable to such end;
         and promptly furnish to Agent a statement respecting any loss or damage
         to any of the Equipment within ten (10) business days after Grantor
         obtains knowledge of any such loss or damage; and

                  (d) pay promptly when due all property and other taxes,
         assessments and governmental charges or levies imposed upon, and all
         claims (including claims for labor, materials and supplies) against,
         the Equipment and Inventory, except to the extent the validity thereof
         is being contested in good faith by appropriate proceedings and for
         which adequate reserves in accordance with Generally Accepted
         Accounting Principles have been set aside.

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         SECTION 4.1.2. AS TO RECEIVABLES. Grantor shall keep its place(s) of
business and chief executive office and the office(s) where it keeps its records
concerning the Receivables, and all originals of all chattel paper which
evidence Receivables, located at the addresses set forth in ITEM C of SCHEDULE I
hereto, or, upon 30 days' prior written notice to Agent at such other locations
in a jurisdiction where all actions required by the first sentence of Section
4.1.7 shall have been taken with respect to the Receivables; not change its name
except upon 30 days' prior written notice to Agent; hold and preserve such
records and chattel paper; and permit representatives of Agent, at any time
during normal business hours to inspect and make abstracts from such records and
chattel paper.

         SECTION 4.1.3.  AS TO ALL COLLATERAL.

                  (a) Grantor shall not permit the ownership of any of the
         Collateral, or any legal or equitable interest therein, to become
         vested in any other person or entity unless otherwise permitted under
         or pursuant to the terms of the Credit Agreement; provided, however,
         until such time as Agent shall notify Grantor of the revocation of such
         power and authority Grantor (i) may in the ordinary course of its
         business, at its own expense, sell, lease or furnish under the
         contracts of service any of the Inventory and Equipment normally held
         by Grantor or any Third Party for such purpose, and use and consume, in
         the ordinary course of its business, any raw materials, work in process
         or materials normally held by Grantor or any Third Party for such
         purpose, and use and consume, in the ordinary course of its business,
         any raw materials, work in process or materials normally held by
         Grantor for such purpose, (ii) will, at its own expense, endeavor to
         collect, as and when due, all amounts due with respect to any of the
         Collateral, including the taking of such action with respect to such
         collection as Agent may reasonably request or, in the absence of such
         request, as Grantor may deem advisable, and (iii) may grant, in the
         ordinary course of business, to any party obligated on any of the
         Collateral, any rebate, refund or allowance to which such party may be
         lawfully entitled, and may accept, in connection therewith, the return
         of goods, the sale or lease of which shall have given rise to such
         Collateral. Agent however, may, at any time after the occurrence of an
         Event of Default, whether before or after any revocation of such power
         and authority or the maturity of any of the Secured Indebtedness,
         notify any parties obligated on any of the Collateral to make payment
         to Agent of any amounts due or to become due thereunder and enforce
         collection of any of the Collateral by suit or otherwise and surrender,
         release, or exchange all or any part thereof, or compromise or extend
         or renew for any period (whether or not longer than the original
         period) any indebtedness thereunder or evidenced thereby. Upon the
         written request of Agent after the occurrence of an Event of Default,
         Grantor will, at its own expense, within five (5) days after receipt of
         such request, notify any parties obligated on any of the Collateral to
         make payment to Agent of any amounts due or to become due thereunder.

                  (b) Agent is authorized to endorse, in the name of Grantor,
         any item, howsoever received by Agent representing any payment on or
         other proceeds of any of the Collateral.

         SECTION 4.1.5. INTENTIONALLY OMITTED.

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         SECTION 4.1.5. INSURANCE. Grantor will maintain, and will cause each of
its Subsidiaries to maintain, insurance with respect to the Equipment and
Inventory with companies reasonably acceptable to Agent. Such insurance shall be
in an amount not less than the fair market value of the Equipment and Inventory
and shall be against such casualties, with such deductible amounts as Agent
shall reasonably approve. All insurance policies shall be written for the
benefit of Grantor and Agent, as their interest may appear, payable to Agent as
loss payee, or in other forms satisfactory to Agent, and such policies or
certificates evidencing the same shall be furnished to Agent. All policies of
insurance shall provide for written notice to Agent at least thirty (30) days
prior to cancellation.

         SECTION 4.1.6. TRANSFERS AND OTHER LIENS.  Grantor shall not:

                  (a) sell, assign (by operation of law or otherwise) or
         otherwise dispose of any of the Collateral, except Inventory in the
         ordinary course of business or as permitted by the Credit Agreement; or

                  (b) create or suffer to exist any Lien or other charge or
         encumbrance upon or with respect to any of the Collateral to secure
         Indebtedness of any Person or entity, except for the security interest
         created by this Security Agreement and except as permitted by the
         Credit Agreement.

         SECTION 4.1.7. FURTHER ASSURANCES, ETC. Grantor agrees that, from time
to time at its own expense, Grantor will promptly execute and deliver all
further instruments and documents, and take all further action, that may be
reasonably necessary or desirable, or that Agent may reasonably request, in
order to perfect, preserve and protect any security interest granted or
purported to be granted hereby or to enable Agent to exercise and enforce their
rights and remedies hereunder with respect to any Collateral. Without limiting
the generality of the foregoing, Grantor will

                  (a) upon the written request of Agent, mark conspicuously each
         document included in the Inventory, each chattel paper included in the
         Receivables and each Related Contract and each of its records
         pertaining to the Collateral with a legend, in form and substance
         satisfactory to Agent indicating that such document, chattel paper,
         Related Contract or Collateral is subject to the security interest
         granted hereby;

                  (b) upon the written request of Agent, any Receivable shall be
         evidenced by a promissory note or other instrument, negotiable document
         or chattel paper, and Grantor shall deliver and pledge to Agent
         hereunder such promissory note, instrument, negotiable document or
         chattel paper, duly endorsed and accompanied by duly executed
         instruments of transfer or assignment, all in form and substance
         satisfactory to Agent;

                  (c) execute and file such financing or continuation
         statements, or amendments thereto, and such other instruments or
         notices (including, without limitation, any assignment of claim form
         under or pursuant to the federal assignment of claims statute, 31
         U.S.C. Section 3726, any successor or amended version thereof or any
         regulation promulgated under or

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         pursuant to any version thereof), as may be reasonably necessary or
         desirable, or as Agent may reasonably request, in order to perfect and
         preserve the security interests and other rights granted or purported
         to be granted to Agent hereby;

                  (d) furnish to Agent, from time to time upon Agent's written
         request, statements and schedules further identifying and describing
         the Collateral and such other reports in connection with the Collateral
         as Agent may reasonably request, all in reasonable detail; and

                  (e) furnish to Agent on a reasonable good faith efforts basis
         such landlord estoppel and waiver agreements for properties leased by
         Grantor (or properties where Grantor maintains inventory or equipment)
         as shall be requested by Agent (all in form and substance acceptable to
         Agent).

With respect to the foregoing and the grant of the security interests hereunder,
Grantor hereby authorizes Agent to file one or more financing or continuation
statements, and amendments thereto, relative to all or any part of the
Collateral without the signature of Grantor where permitted by law. A carbon,
photographic or other reproduction of this Security Agreement or any financing
statement covering the Collateral or any part thereof shall be sufficient as a
financing statement where permitted by law.

                                    ARTICLE V

                                      AGENT

         SECTION 5.1. AGENT APPOINTED ATTORNEY-IN-FACT. Grantor hereby
irrevocably appoints Agent as Grantor's attorney-in-fact, with full authority in
the place and stead of Grantor and in the name of Grantor or otherwise, from
time to time in Agent's discretion, to take any action and to execute any
instruments which Agent may deem necessary or advisable to accomplish the
purposes of this Security Agreement, including, without limitation:

                  (a) to ask, demand, collect, sue for, recover, compromise,
         receive and give acquittance and receipts for moneys due and to become
         due under or in respect of any of the Collateral;

                  (b) to receive, endorse, and collect any drafts or other
         instruments, documents and chattel paper, in connection with clause (a)
         above;

                  (c) to file any claims or take any action or institute any
         proceedings which Agent may deem necessary or desirable for the
         collection of any of the Collateral or otherwise to enforce the rights
         of Agent with respect to any of the Collateral; and

                  (d) to perform the affirmative obligations of Grantor
         hereunder (including all obligations of Grantor pursuant to Section
         4.1.7).

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Grantor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest.

         SECTION 5.2. AGENT MAY PERFORM. If Grantor fails to perform any
agreement contained herein, Agent may perform, or cause performance of, such
agreement, and the reasonable expenses of Agent incurred in connection therewith
shall be payable by Grantor pursuant to Section 6.3.

         SECTION 5.3. AGENT HAS NO DUTY. In addition to, and not in limitation
of, Section 2.4, the powers conferred on Agent hereunder are solely to protect
their interests (on behalf of the Banks) in the Collateral and shall not impose
any duty on it to exercise any such powers. Except for reasonable care of any
Collateral in its possession and the accounting for moneys actually received by
it hereunder, Agent shall not have any duty as to any Collateral or as to the
taking of any necessary steps to preserve rights against prior parties or any
other rights pertaining to any Collateral.

         SECTION 5.4. REASONABLE CARE. Agent is required to exercise reasonable
care in the custody and preservation of any of the Collateral in its possession;
provided, however, Agent shall be deemed to have exercised reasonable care in
the custody and preservation of any of the Collateral, if it takes such action
for that purpose as Grantor reasonably requests in writing at times other than
upon the occurrence and during the continuance of any Event of Default, but
failure of Agent to comply with any such request at any time shall not in itself
be deemed a failure to exercise reasonable care.

                                   ARTICLE VI

                                    REMEDIES

         SECTION 6.1. CERTAIN REMEDIES. If any Event of Default shall have
occurred and be continuing:

                  (a) Agent may exercise in respect of the Collateral, in
         addition to other rights and remedies provided for herein or otherwise
         available to it, all the rights and remedies of a secured party on
         default under the U.C.C. (whether or not the U.C.C. applies to the
         affected Collateral) and also may:

                           (i) require Grantor to, and Grantor hereby agrees
                  that it will, at its expense and upon request of Agent,
                  forthwith, assemble all or part of the Collateral as directed
                  by Agent and make it available to Agent at a place to be
                  designated by Agent which is reasonably convenient to all
                  parties;

                           (ii) without notice except as specified below, sell
                  the Collateral or any part thereof in one or more parcels at
                  public or private sale, at any of Agent's offices or
                  elsewhere, for cash, on credit or for future delivery, and
                  upon such other terms as Agent may deem commercially
                  reasonable. Grantor agrees that, to the extent notice

                                       12
<PAGE>   13

                  of sale shall be required by law, at least ten (10) days'
                  prior notice to Grantor of the time and place of any public
                  sale or the time after which any private sale is to be made
                  shall constitute reasonable notification. Agent shall not be
                  obligated to make any sale of Collateral regardless of notice
                  of sale having been given. Agent may adjourn any public or
                  private sale from time to time by announcement at the time and
                  place fixed therefor, and such sale may, without further
                  notice, be made at the time and place to which it was so
                  adjourned; and

                           (iii) in its own name or the name of Grantor, at any
                  time, to notify any account debtor or obligor or any party
                  obligated on any of the Collateral (including, but not limited
                  to the Receivables, Related Contracts, and General
                  Intangibles) to make all payments due or to become due thereon
                  directly to Agent or such other person or officer as Agent may
                  require, whereupon the power and authority of Grantor to
                  collect the same in the ordinary course of its business shall
                  be deemed to be immediately revoked and terminated. With or
                  without such general notification, Agent may take or bring in
                  Grantor's name or that of the Agent all steps, actions, suits
                  or proceedings deemed by Agent reasonably necessary or
                  desirable to effect possession or collection of the
                  Collateral, including sums due or paid thereon, may complete
                  any contract or agreement of Grantor in any way related to any
                  of the Collateral, may make allowances or adjustments related
                  to the Collateral, may compromise any claims related to the
                  Collateral, may issue credit in its own name or the name of
                  Grantor, may remove from Grantor's premises all documents,
                  instruments, records, files or other items relating to the
                  Collateral. Regardless of any provision hereof, however, Agent
                  shall never be liable for its failure to collect or for its
                  failure to exercise diligence in the collection, possession,
                  or any transaction concerning, all or part of the Collateral
                  or sums due or paid thereon, nor shall it be under any
                  obligation whatsoever to anyone by virtue of this Security
                  Agreement, except to account for the funds that it shall
                  actually receive hereunder.

                           Each account debtor and obligor making payment to
                  Agent hereunder shall be fully protected in relying on the
                  written statement of Agent that it then holds a security
                  interest which entitles it to receive such payments, and the
                  receipt of Agent for such payment shall be full acquittance
                  therefor to the one making such payment.

                           Issuance by Agent of a receipt to any person, firm,
                  corporation or other entity obligated to pay any amounts to
                  Grantor shall be a full and complete release, discharge and
                  acquittance to such person, firm, corporation or other entity
                  to the extent of any amount so paid to Agent. Agent is hereby
                  authorized and empowered on behalf of the Grantor to endorse
                  the name of Grantor upon any check, draft, instrument,
                  receipt, instruction or other document or items, including,
                  but not limited to, all items evidencing payment upon any
                  indebtedness of any person, firm, corporation or other entity
                  to Grantor coming into Agent's possession, and to receive and
                  apply the proceeds therefrom in accordance with the terms
                  hereof. Agent is hereby granted an irrevocable power of
                  attorney, which is coupled with an interest, to execute all
                  checks, drafts, receipts, instruments, instructions or other
                  documents,

                                       13
<PAGE>   14

                  agreements or items on behalf of Grantor, after the occurrence
                  of an Event of Default, as shall be deemed by Agent to be
                  necessary or advisable, in the sole discretion of Agent, to
                  protect their security interests in the Collateral or the
                  repayment of the indebtedness secured hereby, and Agent shall
                  not incur any liability in connection with or arising from its
                  exercise of such power of attorney, except in the event of
                  Agent's willful misconduct or gross negligence.

                  (b) In addition to and without limiting the rights of Agent
         under Section 6.2. below, all cash proceeds received by Agent in
         respect of any sale of, collection from, or other realization upon all
         or any part of the Collateral may, in the discretion of Agent, be held
         by Agent as collateral for, and/or then or at any time thereafter
         applied (after payment of any amounts payable to Agent pursuant to
         Section 6.2) in whole or in part by Agent for the benefit of the Banks
         against, all or any part of the Secured Indebtedness in such order as
         provided in the Credit Agreement or as Agent shall elect. Any surplus
         of such cash or cash proceeds held by Agent and remaining after payment
         in full of all the Secured Indebtedness shall be paid over to Grantor
         or to whomsoever may be lawfully entitled to receive such surplus.

         SECTION 6.2. COLLATERAL ACCOUNT.

                  (a) If an Event of Default shall have occurred and be
         continuing, upon written notice by Agent to Grantor pursuant to this
         clause, all proceeds of Collateral received by Grantor shall be
         delivered in kind to Agent for deposit to a deposit account (the
         "Collateral Account") of Grantor maintained with Agent, and Grantor
         shall not commingle any such proceeds, and shall hold separate and
         apart from all other property, all such proceeds in express trust for
         the benefit of Agent until delivery thereof is made to Agent. No funds
         other than proceeds of Collateral will be deposited in the Collateral
         Account.

                  (b) Agent shall have the right to apply any amount in the
         Collateral Account to the payment of any of the Secured Indebtedness
         that is due and payable or payable upon demand, or to the payment of
         any of the Secured Indebtedness at any time that an Event of Default
         shall have occurred and be continuing. Agent may at any time transfer
         to Grantor's general demand deposit accounts any or all of the
         collected funds in the Collateral Account; provided, however, that any
         such transfer shall not be deemed to be a waiver or modification of any
         of Agent's rights under this Section.

                                       14
<PAGE>   15

         SECTION 6.3. INDEMNITY AND EXPENSES.

                  (a) Grantor agrees to indemnify Agent from and against any and
         all claims, losses and liabilities arising out of or resulting from
         this Security Agreement (including, without limitation, enforcement of
         this Security Agreement), except claims, losses or liabilities
         resulting from Agent's gross negligence or willful misconduct.

         WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH
         INDEMNIFIED PERSON WITH RESPECT TO MATTERS WHICH IN WHOLE OR IN PART
         ARE CAUSED BY OR ARISE OUT OF THE NEGLIGENCE OF SUCH INDEMNIFIED
         PERSON.

                  (b) Grantor will upon demand pay to Agent the amount of any
         and all reasonable expenses, including the reasonable fees and
         disbursements of its counsel and of any experts and agents, which Agent
         may incur in connection with:

                           (i) the administration of this Security Agreement;

                           (ii) the custody, preservation, use or operation of,
                  or the sale of, collection from, or other realization upon,
                  any of the Collateral;

                           (iii) the exercise or enforcement of any of the
                  rights of Agent or the Banks hereunder; or

                           (iv) the failure by Grantor to perform or observe any
                  of the provisions hereof.

         SECTION 6.4. RIGHTS CUMULATIVE. The rights, titles, interests, liens
and securities of Agent hereunder shall be cumulative of all of the securities,
rights, titles, interests or liens which Agent may now or at any time hereafter
hold securing the payment of the Secured Indebtedness, or any part thereof.

                                   ARTICLE VII

                            MISCELLANEOUS PROVISIONS

         SECTION 7.1. LOAN DOCUMENT. This Security Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof.

         SECTION 7.2. AMENDMENTS, ETC. No amendment to or waiver of any
provision of this Security Agreement nor consent to any departure by Grantor
herefrom, shall in any event be effective unless the same shall be in writing
and signed by Agent, and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.

                                       15
<PAGE>   16

         SECTION 7.3. ADDRESSES FOR NOTICES. All notices and other
communications provided for hereunder shall be in writing or by facsimile and,
if to Grantor, mailed, delivered or transmitted to it at the address or
facsimile number set forth below its signature hereto, if to Agent, mailed,
delivered or transmitted to it at the address or facsimile number of Agent
specified in the Credit Agreement, or as to either party at such other address
or facsimile number as shall be designated by such party in a written notice to
each other party complying as to delivery with the terms of this Section. All
such notices and other communications, if mailed and properly addressed with
postage prepaid or if properly addressed and sent by prepaid courier service,
shall be deemed given when received; and all such notices and other
communications, if transmitted by facsimile, shall be deemed given when
transmitted (upon receipt of electronic confirmation of transmission).

         SECTION 7.4. SECTION CAPTIONS. Section captions used in this Security
Agreement are for convenience of reference only, and shall not affect the
construction of this Security Agreement.

         SECTION 7.5. SEVERABILITY. Wherever possible each provision of this
Security Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Security Agreement
shall be prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Security Agreement.

         SECTION 7.6. LIMITATION. Regardless of any provisions contained in this
Security Agreement, the Credit Agreement, the Notes, or any other evidences of
the Secured Indebtedness, or other instruments executed or delivered in
connection therewith, neither Agent nor any Lender Party shall ever be entitled
to receive, collect or apply, as interest on the Secured Indebtedness, any
amount in excess of the highest lawful rate and, in the event that Agent or any
Lender Party ever receives, collects or applies, as interest, any such excess,
such amount which would be excessive interest shall be applied to the reduction
of the unpaid principal balance of the Secured Indebtedness, and if the
principal balance of the Secured Indebtedness is paid in full, any remaining
excess shall be forthwith paid to Grantor. In determining whether or not the
interest paid or payable, under any specific contingency, exceeds the highest
lawful rate, Grantor, Agent, and the Banks shall, to the maximum extent
permitted under applicable law, (a) characterize any non-principal payment as an
expense, fee, or premium rather than as interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) "spread" the total amount of
interest throughout the entire term of the Credit Agreement and the Notes so
that the interest rate is uniform throughout the entire term of the Credit
Agreement and the Notes.

         SECTION 7.7 OBLIGATIONS ABSOLUTE. All rights and remedies of the Agent
hereunder, and all obligations of the Grantor hereunder, shall be absolute and
unconditional irrespective of:

                  (a) any lack of validity or enforceability of the Credit
         Agreement or any of the other Loan Documents or any other agreement or
         instrument relating to any of the foregoing;

                                       16
<PAGE>   17

                   (b) any change in the time, manner, or place of payment of,
         or in any other term of, all or any of the Secured Indebtedness, any or
         all of the Obligation, or any other amendment or waiver of or any
         consent to any departure from the Credit Agreement or any of the Loan
         Documents;

                  (c) any exchange, release, or non-perfection of any
         Collateral, or any release or amendment or waiver of or consent to any
         departure from any guaranty, for all or any of the Secured
         Indebtedness; or

                  (d) any other circumstance (other than payment in full of the
         Secured Indebtedness) that might otherwise constitute a defense
         available to, or a discharge of, the Grantor.

         SECTION 7.8. SUCCESSORS AND ASSIGNS. This Security Agreement is binding
upon and shall inure to the benefit of Grantor, Agent, and the Banks, their
respective heirs, executors, representatives, administrators, successors and
assigns; provided, however, that Grantor may not, without the prior written
consent of Agent, assign any rights, powers, duties or obligations hereunder.

         SECTION 7.9. GOVERNING LAW, ENTIRE AGREEMENT, ETC. THIS SECURITY
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF TEXAS, EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION
OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY
PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE
STATE OF TEXAS.

         SECTION 7.10. FINAL AGREEMENT. THIS SECURITY AGREEMENT AND THE OTHER
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES 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.

                                       17
<PAGE>   18

         IN WITNESS WHEREOF, Grantor has caused this Security Agreement to be
duly executed and delivered by its officer thereunto duly authorized as of the
date first above written.

                                  GRANTOR:

                                  LANCER PARTNERSHIP, LTD., a Texas
                                  limited partnership

                                  By:  Lancer Capital Corporation, a Delaware
                                         corporation, general partner

                                         By: /s/ SCOTT ADAMS
                                             ---------------
                                         Name: Scott Adams
                                         Title: Secretary

                                  Address:
                                  6655 Lancer Boulevard
                                  San Antonio, Texas 78219
                                  Facsimile: (210) 310-7091
                                  Attention:  Chief Financial Officer

                                  18
<PAGE>   19

                                   SCHEDULE I
                                       TO
                               SECURITY AGREEMENT

ITEM A.  LOCATION OF EQUIPMENT AND INVENTORY

(1)      6655 Lancer Blvd., San Antonio, Texas 78219
(2)      10815 Sentinel, San Antonio, Texas 78217

ITEM B.  LOCATION OF LOCK BOXES

                           The Frost National Bank

ITEM C.  LOCATION OF RECORDS CONCERNING RECEIVABLES

(1)      235 West Turbo, San Antonio, Texas  78216
(2)      6655 Lancer Blvd., San Antonio, Texas 78219

ITEM D.  TRADE NAMES

                           [To be completed]<PAGE>   1
                                                                   EXHIBIT 10.10

                     AMENDMENT NO. 1 AND CONSENT AND WAIVER

         This Amendment No. 1 dated as of February 12, 1999 ("Amendment") amends
the Credit Agreement dated as of June 12, 1998 (the "Credit Agreement") among
Arkansas Best Corporation, a Delaware corporation (the "Borrower"), the Banks
party thereto, Societe Generale, Southwest Agency, as Administrative Agent (the
"Agent"), and Bank of America National Trust and Savings Association and Wells
Fargo Bank (Texas), N.A., as Co-Documentation Agents. Capitalized terms defined
in the Credit Agreement and not otherwise defined or redefined herein are used
herein with the meanings so defined.

         WHEREAS the Borrower has requested that the Credit Agreement be amended
to permit the Borrower to make an intercompany loan to Treadco so that Treadco
may purchase all of its issued and outstanding capital stock not owned by the
Borrower and to modify certain covenants of the Borrower set forth in the Credit
Agreement; and

         WHEREAS the Banks have agreed to so amend the Credit Agreement on the
terms and conditions set forth herein.

         NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:

         Section 1. Amendment of Credit Agreement. The Credit Agreement is
hereby amended as follows:

         (a) Section 1.1. Section 1.1 is amended as follows:

             (i) The following definition is modified to read as follows:

                 "Borrowing Base" means an amount equal to the sum of (a) 80% of
             the Net Depreciated Value of Eligible Revenue Equipment, plus (b)
             85% of the aggregate outstanding amount of Eligible Receivables,
             plus (c) 50% of the Net Depreciated Value of Eligible Other
             Equipment, plus (d) 70% of the Real Estate Value of Eligible Real
             Property.

             (ii) The following new definitions are added in alphabetical order:

                 "TAC" means Treadco Acquisition Corp., a Delaware corporation
             and wholly-owned Subsidiary of the Borrower.

                 "Treadco Merger" means the merger of TAC with and into Treadco
             with Treadco being the surviving corporation.

                 "Treadco Credit Agreement" means the Amended and Restated
             Credit Agreement dated as of September 30, 1997 between Treadco and
             Societe Generale, Southwest Agency, as such agreement may be
             amended, modified or restated from time-to-time.

         (b) Section 6.1. Section 6.1 is amended by deleting the "and" at the
end of clause (l),

<PAGE>   2
deleting the period at the end of clause (m), and adding the following new
clauses (n) and (o):

         (n) securing the Treadco Credit Agreement; provided, however that upon
         the consummation of the Treadco Merger, a perfected second Lien shall
         exist on all accounts receivable and inventory of Treadco in favor of
         the Agent for the benefit of the Banks to secure the Obligations in
         accordance with the terms of the Security Agreement executed by
         Treadco; and

         (o) not otherwise permitted herein but permitted under the Treadco
         Credit Agreement.

         (c) Section 6.3. Section 6.3 is modified in its entirety as follows:

                  Section 6.3. Agreements Restricting Distributions From
         Subsidiaries. The Borrower will not, nor will it permit any of its
         Subsidiaries to, enter into any agreement (other than a Credit Document
         or the Treadco Credit Agreement as in effect on the Effective Date)
         which limits distributions to or any advance by any of the Borrower's
         Subsidiaries to the Borrower.

         (d) Section 6.6(d)(iii). Section 6.6(d)(iii) is amended in its entirety
as follows:

                  (iii) the aggregate consideration paid (other than in the form
         of common stock of the Borrower) during any fiscal year for such
         contributions or investments shall not exceed $40,000,000; and

         (e) Section 6.6(f). Section 6.6 is amended by deleting the "and" at the
end of clause (d), substituting "; and" for the period at the end of clause (e),
and by adding the following new clause (f):

                  (f) loans or advances to Treadco in an aggregate amount not to
         exceed $12,000,000 which loans or advances shall be (i) evidenced by a
         promissory note in form and substance satisfactory to the Agent (the
         "Treadco Note"), (ii) subordinated to Treadco's obligations under the
         Credit Documents, (iii) on terms and conditions satisfactory to the
         Agent and (iv) used by Treadco to purchase all or a portion of its
         issued and outstanding shares of its capital stock not owned by the
         Borrower.

         (f) Section 6.9. The introduction exception of Section 6.9 is modified
to read as follows:

         Except as set forth in the Treadco Credit Agreement or any other
         agreements and documentation governing Indebtedness of the Borrower or
         any of its Subsidiaries existing on the Effective Date,

         (g) The first sentence of Section 6.14 of the Credit Agreement is
amended in its entirety as follows:

                                      -2-
<PAGE>   3

         The Borrower may make or permit any of its Subsidiaries to make or
         commit to make any Capital Expenditure; provided, however, that (a)
         Capital Expenditures of the Borrower and its Subsidiaries (other than
         Treadco) may not exceed $85,000,000 in an aggregate amount per fiscal
         year so long as the Borrower's Senior Debt is not rated either BBB- or
         higher by S&P or Baa3 or greater by Moody's and (b) Capital
         Expenditures of Treadco are otherwise permitted under the Treadco
         Credit Agreement.

         (h) Section 6.15. Section 6.15 is amended by deleting the "and" at the
end of clause (e), adding the following new clauses (f) and (g) and modifying
the existing clause (f) to read as follows:

                  (f) the Treadco Credit Agreement;

                  (g) indebtedness of Treadco not otherwise permitted hereunder
         but permitted under the Treadco Credit Agreement; and

                  (h) extensions, renewals and refinancing of any of the
         Indebtedness specified in paragraphs (a) - (c), (f) and (g) above so
         long as the principal amount of such Indebtedness is not thereby
         increased.

         Section 2. Treadco Note. The proceeds of the Treadco Note will be
deemed to be Acquisition Expenditures for the purposes of determining compliance
with Section 6.16 during fiscal year 1999.

         Section 3. Consent and Waiver. (a) Section 6.6(d)(i) of the Credit
Agreement requires that if the aggregate amount of contributions to, or capital
investments by the Borrower or any of its Subsidiaries in any Person which,
prior to such contribution or investment, is not a Subsidiary but which becomes
a Subsidiary as a result of such contribution or investment, exceeds $5,000,000,
then the Borrower shall cause such Person to have executed and delivered to the
Agent an Accession Agreement, related financing statements and a certificate
covering the same matters described in Section 3.1(a)(iii) of the Credit
Agreement with respect to such Person and the Borrower's counsel shall deliver
an opinion with respect thereto covering the matters previously opined on with
regard to each Guarantor.

         (b) Each of the Agent and the Banks hereby waive the requirements of
Section 6.6(d)(i); provided that upon the consummation of the Treadco Merger, in
lieu of Treadco executing and delivering to the Agent an Accession Agreement,
Treadco shall execute and deliver to the Agent (1) a limited guaranty
substantially similar in form and substance to the Guaranty, (2) a security
agreement substantially similar in form and substance to the Guarantor Security
Agreement except that such security agreement shall grant a second priority
security interest to the Agent for its benefit and the benefit of the Banks in
Treadco's accounts receivable and inventory, (3) a certificate covering the same
matters described in

                                      -3-
<PAGE>   4

Section 3.1(a)(iii) of the Credit Agreement with respect to such Person and (4)
the Borrower's counsel shall deliver an opinion with respect thereto covering
the matters previously opined on with regard to each Guarantor. This waiver is
limited to the extent described herein and shall not be construed to be a
consent to or a waiver of any other actions prohibited by the Credit Agreement.
Further, if any such transaction is not completed as described above, all
consents granted hereunder shall be void.

         Section 4. Representations and Warranties. The Borrower hereby
represents and warrants to the Agent and the Banks that, after giving effect
hereto:

         (a) the representations and warranties of the Borrower set forth in the
Credit Agreement and in the other Credit Documents are true and correct in all
material respects as of the date of this Amendment, except those that by their
terms relate only to a specific date;

         (b) (i) the execution, delivery, and performance of this Amendment are
within the corporate power and authority of the Borrower and have been duly
authorized by appropriate proceedings, and (ii) this Amendment constitutes a
legal, valid, and binding obligation of the Borrower enforceable in accordance
with its terms, except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting the rights of creditors
generally and general principles of equity; and

         (c) as of the effectiveness of this Amendment, no Default or Event of
Default has occurred and is continuing.

         Section 5. Effectiveness of Amendment. This Amendment shall become
effective on the date the Agent has received the following:

         (a) counterparts of this Amendment executed by the Borrower and the
Majority Banks,

         (b) a completed Federal Reserve From U-1 executed by the Borrower;

         (c) a pledge agreement in form and substance satisfactory to the Agent
executed by the Borrower pledging the Treadco Note to the Agent for the benefit
of the Banks;

         (d) the Treadco Note endorsed to the Agent for the benefit of the
Banks; and

         (e) an amendment fee payable to each of the Banks approving this
amendment on or before the date hereof in an amount equal to 0.05% of such
Bank's Revolving Commitment.

         Section 6. Effect on Loan Documents.

         (a) Except as amended herein, the Credit Agreement and the Credit
Documents remain in full force and effect as originally executed. Nothing herein
shall act as a waiver

                                      -4-
<PAGE>   5

of any of the Agent's or any of the Bank's rights under the Credit Documents, as
amended, including the waiver of any Default or Event of Default, however
denominated.

         (b) This Amendment is a Credit Document for the purposes of the
provisions of the other Credit Documents. Without limiting the foregoing, any
breach of representations, warranties, and covenants under this Amendment may be
a Default or Event of Default under other Credit Documents.

         Section 7. Fees and Expenses. The Borrower shall reimburse the Agent
for all expenses of the Agent, including charges and disbursements of legal
counsel for the Agent, in connection with the creation, amendment, modification,
waiver, or interpretation of this Amendment, and the preservation or enforcement
of any rights of the Agent or any of the Banks under this Amendment.

         Section 8. Counterparts. This Amendment may be executed in any number
of counterparts which together shall constitute an instrument.

         Section 9. Governing Law. This Amendment shall be governed by, and
construed and enforced in accordance with, the laws of the State of Texas.

         PURSUANT TO SECTION 26.02 OF THE TEXAS BUSINESS AND COMMERCE CODE, A
CREDIT AGREEMENT IN WHICH THE AMOUNT INVOLVED IN THE CREDIT AGREEMENT EXCEEDS
$50,000 IN VALUE IS NOT ENFORCEABLE UNLESS THE CREDIT AGREEMENT IS IN WRITING
AND SIGNED BY THE PARTY TO BE BOUND OR THAT PARTY'S AUTHORIZED REPRESENTATIVE.

         THE RIGHTS AND OBLIGATIONS OF THE PARTIES TO AN AGREEMENT SUBJECT TO
THE PRECEDING PARAGRAPH SHALL BE DETERMINED SOLELY FROM THE WRITTEN CREDIT
AGREEMENT, AND ANY PRIOR ORAL AGREEMENTS BETWEEN THE PARTIES ARE SUPERSEDED BY
AND MERGED INTO THE CREDIT AGREEMENT. THIS WRITTEN AMENDMENT AND THE LOAN
DOCUMENTS, AS DEFINED IN THIS AMENDMENT, REPRESENT THE FINAL AGREEMENT AMONG THE
PARTIES 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.

                     [REMAINDER OF PAGE INTENTIONALLY BLANK]

<PAGE>   6

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers duly authorized as of the date first
written above.

                                  BORROWER:

                                  ARKANSAS BEST CORPORATION

                                  By:
                                     -------------------------------------------
                                       David E. Loeffler
                                       Vice President - Chief Financial Officer

                                  BANK:

                                  SOCIETE GENERALE,
                                       SOUTHWEST AGENCY

                                  By:
                                     -------------------------------------------
                                       Christopher Speltz
                                       Director, Head of SG - Dallas

                                  By:
                                     -------------------------------------------
                                       David C. Oldani
                                       Associate

<PAGE>   7

                                  CO-DOCUMENTATION AGENTS:

                                  BANK OF AMERICA NATIONAL TRUST AND
                                        SAVINGS ASSOCIATION

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

<PAGE>   8

                                  WELLS FARGO BANK (TEXAS), N.A.

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

<PAGE>   9

                                  BANKS:

                                  SOCIETE GENERALE,
                                       SOUTHWEST AGENCY

                                  ----------------------------------------------
                                  Christopher J. Speltz
                                  Director - Head of SG-Dallas

                                  ----------------------------------------------
                                  David C. Oldani
                                  Associate

<PAGE>   10

                                  BANK OF AMERICA NATIONAL TRUST AND
                                        SAVINGS ASSOCIATION

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

<PAGE>   11

                                  WELLS FARGO BANK (TEXAS), N.A.

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

<PAGE>   12

                                  ABN AMRO BANK N.V.

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

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

<PAGE>   13

                                  CREDIT LYONNAIS NEW YORK BRANCH

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

<PAGE>   14

                                  DEPOSIT GUARANTY NATIONAL BANK

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

<PAGE>   15

                                  THE FIRST NATIONAL BANK OF CHICAGO

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

<PAGE>   16

                                  NATEXIS BANQUE  BFCE

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

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

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