Document:

Exhibit 10.1

                                                               EXECUTION VERSION

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                                CREDIT AGREEMENT

                                     between

                        UNIROYAL TECHNOLOGY CORPORATION,
                                   as BORROWER
                                       and

                               EMCORE CORPORATION,
                                    as LENDER

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                           Dated as of August 2, 2001

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                                TABLE OF CONTENTS

                                                                            Page

SECTION 1.  Amount and Terms of Credit.......................................1

         1.01  The Commitment................................................1
         1.02  Notice of Borrowing...........................................1
         1.03  Disbursement of Funds.........................................1
         1.04  Notes.........................................................1
         1.05  Interest......................................................2

SECTION 2.  Reductions of Commitment.........................................2

         2.01  Mandatory Reduction of Commitments............................2

SECTION 3.  Prepayments; Payments; Taxes.....................................3

         3.01  Voluntary Prepayments.........................................3
         3.02  Mandatory Repayments..........................................3
         3.03  Method and Place of Payment...................................4
         3.04  Net Payments..................................................4

SECTION 4.  Conditions Precedent to the Loan on the Closing Date.............5

         4.01  Execution of Agreement; Note; Notice of Borrowing.............5
         4.02  Officer's Certificate.........................................6
         4.03  Opinions of Counsel...........................................6
         4.04  Corporate Documents; Proceedings; etc.........................6
         4.05  Plans; Shareholders' Agreements; Management Agreements;
                  Employment Agreements; Non-Compete Agreements; Collective
                  Bargaining Agreements; Tax Sharing Agreements; Existing
                  Indebtedness
                  Agreements.................................................6
         4.06  Sale..........................................................7
         4.07  Adverse Change, etc...........................................7
         4.08  Litigation....................................................8
         4.09  Security Agreement............................................8
         4.10  Subsidiaries Guaranty.........................................9
         4.11  Financial Statements; Pro Forma Balance Sheet; Projections....9
         4.12  Solvency Certificate; Insurance Certificates..................9
         4.13  No Default; Representations and Warranties....................9

SECTION 5.  Representations, Warranties and Agreements.......................9

         5.01  Organizational Status........................................10
         5.02  Power and Authority..........................................10
         5.03  No Violation.................................................10
         5.04  Approvals....................................................10

                                      (i)
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                                                                            Page

         5.05  Financial Statements; Financial Condition; Undisclosed
                  Liabilities; Projections; etc.............................11
         5.06  Litigation...................................................12
         5.07  True and Complete Disclosure.................................12
         5.08  Use of Proceeds; Margin Regulations..........................12
         5.09  Tax Returns and Payments.....................................13
         5.10  Compliance with ERISA........................................13
         5.11  The Security Documents.......................................14
         5.12  Representations and Warranties in the Documents..............14
         5.13  Properties...................................................14
         5.14  Capitalization...............................................15
         5.15  Subsidiaries.................................................15
         5.16  Compliance with Statutes, etc................................15
         5.17  Investment Company Act.......................................15
         5.18  Public Utility Holding Company Act...........................15
         5.19  Environmental Matters........................................15
         5.20  Labor Relations..............................................16
         5.21  Patents, Licenses, Franchises and Formulas...................16
         5.22  Indebtedness.................................................17
         5.23  Transaction..................................................17
         5.24  Insurance....................................................17

SECTION 6.  Affirmative Covenants...........................................17

         6.01  Information Covenants........................................17
                  (a)  Monthly Reports......................................17
                  (b)  Quarterly Financial Statements.......................18
                  (c)  Annual Financial Statements..........................18
                  (e)  Budgets..............................................18
                  (f)  Officer's Certificates...............................18
                  (g)  Notice of Default, Litigation and Material
                         Adverse Effect.....................................19
                  (h)  Other Reports and Filings............................19
                  (i)  Environmental Matters................................19
                  (j)  Other Information....................................20
         6.02  Books, Records and Inspections...............................20
         6.03  Maintenance of Property; Insurance...........................20
         6.04  Existence; Franchises........................................21
         6.05  Compliance with Statutes, etc................................21
         6.06  Compliance with Environmental Laws...........................21
         6.07  ERISA........................................................22
         6.08  End of Fiscal Years; Fiscal Quarters.........................23
         6.09  Performance of Obligations...................................23
         6.10  Additional Security; Further Assurances......................24
         6.11  Disposition..................................................24
         6.12  Use of Proceeds..............................................24

                                      (ii)
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                                                                            Page

SECTION 7.  Negative Covenants..............................................24

         7.01  Liens........................................................25
         7.02  Consolidation, Merger, Purchase or Sale of Assets, etc.......27
         7.03  Dividends....................................................29
         7.04  Indebtedness.................................................30
         7.05  Advances, Investments and Loan...............................31
         7.06  Transactions with Affiliates.................................33
         7.07  Limitation on Voluntary Payments and Modifications of Certain
                  Indebtedness; Modifications of Certificate of Incorporation,
                  By-Laws and Certain Other Agreements,
                  etc.......................................................33
         7.08  Limitation on Certain Restrictions on Subsidiaries...........34
         7.09  Limitation on Issuance of Capital Stock......................34
         7.10  Business.....................................................35
         7.11  Limitation on Creation of Subsidiaries.......................35

SECTION 8.  Events of Default...............................................35

         8.01  Payments.....................................................35
         8.02  Representations, etc.........................................35
         8.03  Covenants....................................................35
         8.04  Default Under Other Agreements...............................36
         8.05  Bankruptcy, etc..............................................36
         8.06  ERISA........................................................36
         8.07  Security Documents...........................................37
         8.08  Subsidiaries Guaranty........................................37
         8.09  Judgments....................................................38
         8.10  Change of Control............................................38

SECTION 9.  Definitions and Accounting Terms................................38

         9.01  Defined Terms................................................38

SECTION 10.  Conversion.....................................................50

         10.01  Conversion of Note..........................................50

SECTION 11.  Miscellaneous..................................................55

         11.01  Payment of Expenses, etc....................................55
         11.02  Right of Setoff.............................................56
         11.03  Notices.....................................................56
         11.04  Benefit of Agreement; Assignments; Participations...........56
         11.05  No Waiver; Remedies Cumulative..............................57
         11.05  Calculations; Computations; Adjustments; Accounting Terms...57
         11.07  GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
                  JURY TRIAL................................................57
         11.08  Counterparts................................................59
         11.09  Effectiveness...............................................59

                                     (iii)
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                                                                            Page

         11.10  Headings Descriptive........................................59
         11.11  Amendment or Waiver; etc....................................59
         11.12  Survival....................................................59
         11.13  Domicile of Loan............................................59
         11.14  Confidentiality.............................................59
         11.15  Register....................................................60

                                      (iv)
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         SCHEDULE I                 Commitments
         SCHEDULE II                Lender Addresses
         SCHEDULE III               Plans
         SCHEDULE IV                Real Property
         SCHEDULE V                 Subsidiaries
         SCHEDULE VI                Existing Indebtedness
         SCHEDULE VII               Insurance
         SCHEDULE VIII              Existing Liens
         SCHEDULE IX                Existing Investments
         SCHEDULE X                 Indebtedness to be Refinanced
         SCHEDULE XI                Existing Affiliate Transactions

         EXHIBIT A                  Notice of Borrowing
         EXHIBIT B                  Note
         EXHIBIT C                  Opinion of Mr Oliver J. Janney, Esq.,
                                    General Counsel to the Borrower and each of
                                    its Subsidiaries
         EXHIBIT D                  Officers' Certificate
         EXHIBIT E                  Security Agreement
         EXHIBIT F                  Subsidiaries Guaranty
         EXHIBIT G                  Solvency Certificate
         EXHIBIT H                  Intercompany Note
         EXHIBIT I                  Shareholder Subordinated Note
         EXHIBIT J                  Control Agreement

                                      (v)

<PAGE>
         CREDIT  AGREEMENT,  dated  as  of  August  2,  2001,  between  UNIROYAL
TECHNOLOGY  CORPORATION,  a Delaware  corporation (the  "Borrower"),  and EMCORE
CORPORATION, a New Jersey corporation, as Lender (the "Lender") (all capitalized
terms used herein and defined in Section 9 are used herein as therein defined).

                              W I T N E S S E T H :

         WHEREAS, subject to and upon the terms and conditions set forth herein,
the Lender is willing to make  available  to the  Borrower  the credit  facility
provided for herein;

         NOW, THEREFORE, IT IS AGREED:

         SECTION 1. Amount and Terms of Credit.

         1.01 The  Commitment.  Subject to and upon the terms and conditions set
forth  herein,  the  Lender  agrees  to make a term  loan  (the  "Loan")  to the
Borrower,  which Loan (i) may only be  incurred  by the  Borrower on the Closing
Date, (ii) shall be made by the Lender in that aggregate  principal amount which
does not exceed the  Commitment of the Lender on the Closing Date (before giving
effect to the  termination  thereof on such date  pursuant to Section  2.01(c)).
Once repaid, the Loan incurred hereunder may not be reborrowed.

         1.02 Notice of Borrowing.  When the Borrower  desires to incur the Loan
hereunder, the Borrower shall give the Lender notice at the Notice Office on the
date thereof,  provided that such notice shall be deemed to have been given on a
certain day only if given  before 11:00 A.M.  (New York time) on such day.  Such
notice (the "Notice of Borrowing")  shall be  irrevocable  and shall be given by
the  Borrower in writing in the form of Exhibit A,  appropriately  completed  to
specify the aggregate principal amount of the Loan to be incurred on the Closing
Date.

         1.03  Disbursement of Funds. No later than 2:00 P.M. (New York time) on
the Closing Date, the Lender will make  available the Borrowing  requested to be
made on such date in accordance  with Section 1.02.  The Borrowing  will be made
available in Dollars and in immediately  available funds by way of wire transfer
to the Borrower's account specified in the Notice of Borrowing.

         1.04 Notes. (a) The Borrower's  obligation to pay the principal of, and
interest  on, the Loan made by the Lender  shall be  evidenced  in the  Register
maintained  by the Lender  pursuant to Section 11.15 and shall also be evidenced
by a promissory  note duly executed and delivered by the Borrower  substantially
in the form of Exhibit B, with  blanks  appropriately  completed  in  conformity
herewith (the "Note").

         (b)  The  Note  issued  to the  Lender  shall  (i) be  executed  by the
Borrower,  (ii) be payable to the Lender or its registered  assigns and be dated
the Closing  Date (or, if issued  after the Closing  Date,  be dated the date of
issuance thereof),  (iii) be in a stated principal amount equal

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to the Loan made by the  Lender on the  Closing  Date (or,  if issued  after the
Closing Date, be in a stated principal amount equal to the outstanding principal
amount of the Loan of the Lender at such time) and be payable in the outstanding
principal  amount  of the Loan  evidenced  thereby,  (iv)  mature  on the  Final
Maturity  Date,  (v) bear  interest  as provided  in the  appropriate  clause of
Section  1.05,  (vi) be subject to voluntary  prepayment  as provided in Section
3.01, and mandatory repayment as provided in Section 3.02, and (vii) be entitled
to the benefits of this Agreement and the other Credit Documents.

         (c) The Lender will note on its internal records the amount of the Loan
made by it and each payment in respect thereof and will prior to any transfer of
its Note endorse on the reverse side thereof the outstanding principal amount of
the Loan  evidenced  thereby.  Failure to make any such notation or any error in
such  notation  shall not affect the  Borrower's  obligations  in respect of the
Loan.

         1.05  Interest.  (a) The Borrower  agrees to pay interest in respect of
the unpaid principal amount of the Loan from the date of Borrowing thereof until
the  repayment  in full  thereof at a rate per annum which shall be equal to the
Prime Rate as in effect from time to time.

         (b) From and after the  Additional  Interest  Trigger  Date,  principal
shall bear  additional  interest as  follows:  the  Borrower  shall issue to the
Lender Four Hundred  Thirty-Three  (433) shares of UTC Common Stock  (subject to
appropriate  adjustments in the event of a stock split or a similar  event),  or
such  percentage of such amount as shall equal the equivalent  percentage of the
principal  amount  of the Loan  then  outstanding,  per  calendar  day until all
Obligations  have been paid in full.  Interest  which accrues under this Section
1.05(b)  shall be  payable  on  demand.  UTC  Common  Stock to be  issued by the
Borrower under this Section 1.05(b) shall be issued  immediately upon request of
the Lender.

         (c) Accrued (and theretofore  unpaid) cash interest shall be payable in
respect of the Loan,  monthly in arrears on each Monthly Payment Date and on the
Final  Maturity Date and on any repayment or prepayment (on the amount repaid or
prepaid), and at maturity (whether by acceleration or otherwise).

         SECTION 2. Reductions of Commitment.

         2.01  Mandatory  Reduction of  Commitments.  (a) The  Commitment  shall
terminate  in its  entirety  on August  31,  2001  unless the  Closing  Date has
occurred on or before such date.

         (b) In addition to any other mandatory  commitment  reductions pursuant
to this Section 2.01, the Commitment shall terminate in its entirety on the date
of consummation of the Disposition.

         (c) In addition to any other mandatory  commitment  reductions pursuant
to this Section  2.01,  the  Commitment  shall  terminate in its entirety on the
Closing Date (after giving effect to the incurrence of the Loan on such date).

                                       2
<PAGE>
         SECTION 3. Prepayments; Payments; Taxes.

         3.01 Voluntary Prepayments. The Borrower shall have the right to prepay
the Loan,  without premium or penalty,  in whole or in part at any time and from
time to time on the following terms and conditions:  (i) the Borrower shall give
the Lender prior to 1:00 P.M. (New York time) at the Notice Office, at least one
Business Day's prior written notice (or telephonic notice promptly  confirmed in
writing)  of its intent to prepay the Loan,  which  notice (in each case)  shall
specify the amount of such  prepayment;  (ii) each  partial  prepayment  of Loan
pursuant to this Section 3.01(a) shall be in an aggregate principal amount of at
least $25,000.

         3.02  Mandatory  Repayments.  (a) In  addition  to any other  mandatory
repayments  pursuant to this  Section  3.02,  within one Business Day after each
date on or  after  the  Closing  Date  upon  which  the  Borrower  or any of its
Subsidiaries  receives any cash  proceeds from any capital  contribution  or any
sale or  issuance  of its  equity  or  securities  convertible  into its  equity
(including,  without  limitation,  convertible  debt) (other than cash  proceeds
received from equity  contributions to any Guarantor  Subsidiary of the Borrower
to the extent  made by the  Borrower  or  another  Guarantor  Subsidiary  of the
Borrower)  an amount  equal to 100% of the Net Equity  Proceeds of such  capital
contribution  or sale or issuance  of equity  shall be applied on such date as a
mandatory repayment of principal of the outstanding Loan until paid in full.

         (b) In  addition  to any other  mandatory  repayments  pursuant to this
Section  3.02, on each date on or after the Closing Date upon which the Borrower
or any of its Subsidiaries receives any cash proceeds from any incurrence by the
Borrower or any of its  Subsidiaries of  Indebtedness  for borrowed money (other
than  Indebtedness  for  borrowed  money  permitted  to be incurred  pursuant to
Section 7.04 as such Section is in effect on the Closing Date),  an amount equal
to 100% of the Net Debt Proceeds of the  respective  incurrence of  Indebtedness
shall be applied  on such date as a  mandatory  repayment  of  principal  of the
outstanding Loan until paid in full.

         (c) In  addition  to any other  mandatory  repayments  pursuant to this
Section  3.02,  within one  Business Day after each date on or after the Closing
Date upon  which  the  Borrower  or any of its  Subsidiaries  receives  any cash
proceeds  from any Asset Sale,  an amount equal to 100% of the Net Sale Proceeds
therefrom  shall be  applied  on such date as a  mandatory  repayment  until the
Obligations are paid in full.

         (d) In  addition  to any other  mandatory  repayments  pursuant to this
Section 3.02,  within 10 days  following  each date on or after the Closing Date
upon which the Borrower or any of its  Subsidiaries  receives any cash  proceeds
from any Recovery  Event (other than Recovery  Events in which the Net Insurance
Proceeds therefrom do not exceed $1,000,000), an amount equal to 100% of the Net
Insurance  Proceeds  from such  Recovery  Event  shall be applied as a mandatory
repayment of principal of the outstanding Loan until paid in full; provided that
so long as no Specified  Default then exists and such Net Insurance  Proceeds do
not exceed  $5,000,000,  such Net Insurance Proceeds shall not be required to be
so  applied  on such  date to the  extent  that the  Borrower  has  delivered  a
certificate  to the  Lender  on or  prior to such  date  stating  that  such Net
Insurance  Proceeds shall be used to replace or restore any properties or assets
in  respect  of which  such Net  Insurance  Proceeds  were paid  within 270 days
following  the

                                       3
<PAGE>
date of the receipt of such Net Insurance  Proceeds (which certificate shall set
forth the  estimates  of the Net  Insurance  Proceeds  to be so  expended),  and
provided further,  that (i) if the amount of such Net Insurance Proceeds exceeds
$5,000,000,  then the entire amount of such Net Insurance Proceeds (and not just
the portion of such Net  Insurance  Proceeds in excess of  $5,000,000)  shall be
applied as a mandatory  repayment of the Loan as provided  above in this Section
3.02(d),  (ii) if all or any portion of such Net Insurance Proceeds not required
to be applied to the repayment of the outstanding Loan pursuant to the preceding
proviso are not so used within 90 days after the date of the receipt of such Net
Insurance Proceeds (or such earlier date, if any, as the Borrower determines not
to reinvest the Net Insurance  Proceeds  relating to such Recovery  Event as set
forth above),  such  remaining  portion shall be applied on the last day of such
period (or such earlier  date,  as the case may be) as a mandatory  repayment of
principal of the  outstanding  Loan as provided  above in this  Section  3.02(d)
without regard to the preceding proviso.

         (e) In  addition  to any other  mandatory  repayments  pursuant to this
Section  3.02,  (i) the  outstanding  Loan  shall be repaid in full on the Final
Maturity Date and (ii) unless the Lender otherwise agrees,  the outstanding Loan
shall be  repaid  in full on the  earlier  of the date on which  (A) a Change of
Control occurs or (B) the Disposition occurs.

         3.03  Method and Place of  Payment.  Except as  otherwise  specifically
provided  herein,  all payments  under this  Agreement  (other than  payments of
additional interest pursuant to Section 1.05(b)) or under the Note shall be made
to the Lender for its own  account  not later than 1:00 P.M.  (New York time) on
the date when due and shall be made in Dollars in immediately available funds at
the Notice  Office (and, to the extent that any UTC Common Stock is to be issued
pursuant to Section 1.05(b),  such issuance shall occur by the delivery of stock
certificates  or such  other  documentation  satisfactory  to the  Lender in its
discretion,  evidencing  the issuance of the UTC Common Stock to the  Borrower).
Whenever  any payment to be made  hereunder or under the Note shall be stated to
be due on a day  which is not a  Business  Day,  the due date  thereof  shall be
extended to the next  succeeding  Business Day and,  with respect to payments of
principal,  interest  shall  be  payable  at the  applicable  rate  during  such
extension.

         3.04 Net Payments.  (a) All payments made by the Borrower  hereunder or
under the Note  will be made  without  setoff,  counterclaim  or other  defense;
provided, further, that for the purpose of this Section 3.04(a), "payment" shall
be deemed to include, without limitation,  the issuance of UTC Common Stock. All
such  payments  will be made  free  and  clear  of,  and  without  deduction  or
withholding for, any present or future taxes,  levies,  imposts,  duties,  fees,
assessments or other charges of whatever nature now or hereafter  imposed by any
jurisdiction  or by any political  subdivision  or taxing  authority  thereof or
therein with respect to such payments (but excluding,  except as provided in the
second succeeding sentence,  any tax imposed on or measured by the net income or
profits of the Lender  pursuant to the laws of the  jurisdiction  in which it is
organized or the  jurisdiction  in which the  principal  office of the Lender is
located or any  subdivision  thereof or therein) and all interest,  penalties or
similar  liabilities with respect to such non-excluded taxes,  levies,  imposts,
duties, fees, assessments or other charges (all such non-excluded taxes, levies,
imposts,   duties,  fees,   assessments  or  other  charges  being  referred  to
collectively  as "Taxes").  If any Taxes are so levied or imposed,  the Borrower
agrees to pay the full amount of such Taxes, and such additional  amounts as may
be  necessary so that every  payment of all amounts due under this  Agreement or
under the Note,  after  withholding or deduction

                                       4
<PAGE>
for or on account of any Taxes,  will not be less than the amount  provided  for
herein or in the Note.  If any amounts are payable in respect of Taxes  pursuant
to the preceding sentence,  the Borrower agrees to reimburse the Lender,  within
three Business Days after the written  request of the Lender,  for taxes imposed
on or measured  by the net income or profits of the Lender  pursuant to the laws
of the  jurisdiction  in which the Lender is organized or in which the principal
office or applicable  lending  office of the Lender is located or under the laws
of any political  subdivision or taxing  authority of any such  jurisdiction  in
which the Lender is organized  or in which the  principal  office or  applicable
lending office of the Lender is located and for any  withholding of taxes as the
Lender shall determine are payable by, or withheld from, the Lender,  in respect
of such amounts so paid to or on behalf of the Lender  pursuant to the preceding
sentence  and in  respect  of any  amounts  paid to or on behalf  of the  Lender
pursuant to this  sentence.  The Borrower  will furnish to the Lender  within 30
days after the date the payment of any Taxes is due pursuant to  applicable  law
certified  copies of tax receipts  evidencing such payment by the Borrower.  The
Borrower  agrees to indemnify  and hold  harmless the Lender,  and reimburse the
Lender within three Business Days after its written  request,  for the amount of
any Taxes so levied or imposed and paid by the Lender.

         (b) If the Borrower pays any additional  amount under this Section 3.04
to the Lender  and the  Lender  determines  in its sole  discretion  that it has
actually  received  or  realized  in  connection  therewith  any  refund  or any
reduction of, or credit  against,  its Tax liabilities in or with respect to the
taxable  year in which  the  additional  amount is paid (a "Tax  Benefit"),  the
Lender  shall pay to the Borrower an amount that the Lender  shall,  in its sole
discretion, determine is equal to the net benefit, after tax, which was obtained
by the  Lender  in such year as a  consequence  of such Tax  Benefit;  provided,
however,  that (i) the Lender may  determine in its sole  discretion  consistent
with the policies of the Lender  whether to seek a Tax  Benefit,  (ii) any Taxes
that are  imposed  on the  Lender as a result  of a  disallowance  or  reduction
(including  through the  expiration  of any tax  carryover  or carryback of such
Lender that otherwise would not have expired) of any Tax Benefit with respect to
which the Lender has made a payment to the  Borrower  pursuant  to this  Section
3.04(b)  shall be  treated  as a Tax for  which the  Borrower  is  obligated  to
indemnify  the Lender  pursuant to this Section 3.04 without any  exclusions  or
defenses,  (iii)  nothing in this Section  3.04(b)  shall  require the Lender to
disclose  any  confidential  information  to the  Borrower  (including,  without
limitation, the Lender's tax returns), and (iv) the Lender shall not be required
to pay the  Borrower any amounts  pursuant to this  Section  3.04(b) at any time
that a Specified Default exists.

         SECTION 4.  Conditions  Precedent to the Loan on the Closing Date.  The
obligation  of the Lender to make the Loan on the Closing Date is subject to the
satisfaction of the following conditions on or prior to the Closing Date:

         4.01  Execution  of  Agreement;  Note;  Notice of  Borrowing.  (i) This
Agreement  shall have been  executed and  delivered as provided in Section 11.09
and (ii) there shall have been  delivered to the Lender the Note executed by the
Borrower in the amount,  maturity  and as  otherwise  provided  herein and (iii)
there shall have been  delivered  to the Lender the Notice of  Borrowing  on the
Closing Date as provided in Section 1.02.

                                       5
<PAGE>
         4.02   Officer's   Certificate.   The  Lender  shall  have  received  a
certificate,  dated the Closing Date and signed on behalf of the Borrower by the
Chairman of the Board, the Chief Executive  Officer or the President or any Vice
President of the Borrower,  certifying on behalf of the Borrower that all of the
conditions in Sections  4.06,  4.07,  4.08 and 4.13 have been  satisfied on such
date (except to the extent that any exception is satisfactory to the Lender).

         4.03  Opinions  of Counsel.  The Lender  shall have  received  (i) from
Oliver J. Janney, Esq., general counsel of the Borrower, an opinion addressed to
the Lender and dated the Closing Date  covering the matters set forth in Exhibit
C and such other matters incident to the transactions contemplated herein as the
Lender may reasonably request, and (ii) reliance letters addressed to the Lender
and dated the Closing Date with respect to the  opinions  delivered  pursuant to
the other  Documents,  which reliance  letters and opinions shall be in form and
substance reasonably satisfactory to the Lender.

         4.04 Corporate Documents;  Proceedings;  etc. (a) The Lender shall have
received a certificate from each Credit Party, dated the Closing Date, signed by
the Chairman of the Board,  the  President or any Vice  President of such Credit
Party,  and  attested to by the  Secretary  or any  Assistant  Secretary of such
Credit Party,  in the form of Exhibit D with  appropriate  insertions,  together
with copies of the  certificate  of  incorporation  and  by-laws (or  equivalent
organizational  documents)  of such  Credit  Party and the  resolutions  of such
Credit Party referred to in such certificate, and each of the foregoing shall be
in form and substance reasonably acceptable to the Lender.

         (b)  All  corporate  and  legal  proceedings  and all  instruments  and
agreements in connection  with the  transactions  contemplated by this Agreement
and the other Documents  shall be reasonably  satisfactory in form and substance
to the Lender,  and the Lender shall have received all information and copies of
all  documents  and  papers,   including   records  of  corporate   proceedings,
governmental  approvals,  good standing certificates and bring-down telegrams or
facsimiles, if any, which the Lender reasonably may have requested in connection
therewith, such documents and papers where appropriate to be certified by proper
corporate or governmental authorities.

         4.05 Plans; Shareholders' Agreements; Management Agreements; Employment
Agreements;   Non-Compete  Agreements;  Collective  Bargaining  Agreements;  Tax
Sharing  Agreements;  Existing  Indebtedness  Agreements.  There shall have been
delivered to the Lender true and correct copies of the following documents:

         (i) all Plans  (and for each Plan  that is  required  to file an annual
    report on Internal  Revenue  Service  Form  5500-series,  a copy of the most
    recent such report (including, to the extent required, the related financial
    and  actuarial  statements  and  opinions and other  supporting  statements,
    certifications,  schedules  and  information),  and for each  Plan that is a
    "single-employer plan," as defined in Section 4001(a)(15) of ERISA, the most
    recently  prepared  actuarial  valuation  therefor) and any other  "employee
    benefit plans," as defined in Section 3(3) of ERISA,  and any other material
    agreements,  plans or  arrangements,  with or for the  benefit of current or
    former  employees  of the  Borrower  or any of  its  Subsidiaries  or  ERISA
    Affiliates  (provided  that  the  foregoing  shall  apply in the case of any
    multiemployer  plan, as defined in Section  4001(a)(3) of ERISA, only to the
    extent  that

                                       6
<PAGE>
    any document  described  therein is in the  possession of the Borrower,  any
    Subsidiary of the Borrower or any ERISA  Affiliate or  reasonably  available
    thereto from the sponsor or trustee of any such Plan);

         (ii) all  agreements  entered  into by the  Borrower or any  Subsidiary
    Guarantors  governing the terms and relative rights of its capital stock and
    any agreements  entered into by its  shareholders to which the Borrower is a
    party  relating  to any  such  entity  with  respect  to its  capital  stock
    (collectively, the "Shareholders' Agreements");

         (iii) except for the Employment Agreements delivered pursuant to clause
    (v) of this Section 4.05, all material  agreements  with members of, or with
    respect to, the  management  of the  Borrower or any  Subsidiary  Guarantors
    (collectively, the "Management Agreements");

         (iv) all material employment agreements entered into by the Borrower or
    any  Subsidiary  Guarantors  (collectively,  the  "Employment  Agreements");

         (v) all  non-compete  agreements  entered  into by the  Borrower or any
    Subsidiary   Guarantors   (collectively,   the  "Non-Compete   Agreements");

         (vi) all collective  bargaining  agreements applying or relating to any
    employee of the Borrower or any  Subsidiary  Guarantors  (collectively,  the
    "Collective Bargaining Agreements");

         (vii) all tax sharing,  tax  allocation  and other  similar  agreements
    entered into by the Borrower or any Subsidiary Guarantors (collectively, the
    "Tax Sharing Agreements"); and

         (viii) all  agreements  evidencing or relating to  Indebtedness  of the
    Borrower or any Subsidiary  Guarantors which is to remain  outstanding after
    giving effect to the Transaction  (collectively,  the "Existing Indebtedness
    Agreements");

all of which Plans, Shareholders' Agreements,  Management Agreements, Employment
Agreements,   Non-Compete  Agreements,  Collective  Bargaining  Agreements,  Tax
Sharing  Agreements and Existing  Indebtedness  Agreements  shall be in form and
substance  reasonably  satisfactory to the Lender and shall be in full force and
effect on the Closing Date.

         4.06  Sale.  The Sale  shall  have  been  consummated  in all  material
respects in accordance with the Sale Documents and all applicable laws, and each
of the conditions  precedent to the consummation of the Sale as set forth in the
Sale Documents shall have been satisfied and not waived, except with the consent
of the Lender, to the reasonable satisfaction of the Lender.

         4.07 Adverse  Change,  etc.  (a) Except as set forth on Schedule  4.07,
nothing  shall have  occurred (and the Lender shall not have become aware of any
facts or conditions not previously known) since October 1, 2000 which the Lender
shall reasonably determine has had, or could reasonably be expected to have, (i)
a Material Adverse Effect or (ii) a material adverse effect on the Transaction.

                                       7
<PAGE>
         (b) All necessary  governmental  (domestic and foreign) and third party
approvals  and/or  consents in  connection  with the  Transaction  and the other
transactions  contemplated by the Documents and otherwise  referred to herein or
therein  shall  have been  obtained  and remain in  effect,  and all  applicable
waiting periods with respect thereto shall have expired without any action being
taken by any competent authority which restrains, prevents or imposes materially
adverse  conditions  upon  the  consummation  of the  Transaction  or the  other
transactions  contemplated  by the Documents or otherwise  referred to herein or
therein.  There  shall  not  exist  any  judgment,  order,  injunction  or other
restraint  issued  or filed or a  hearing  seeking  injunctive  relief  or other
restraint  pending  or  notified  prohibiting  or  imposing  materially  adverse
conditions  upon the Transaction or the other  transactions  contemplated by the
Documents or otherwise referred to herein or therein.

         4.08  Litigation.  There  shall be no  actions,  suits  or  proceedings
pending or threatened (i) with respect to the Transaction, this Agreement or any
other Document which the Lender shall  reasonably  determine could reasonably be
expected  to be  material or (ii) which the Lender  shall  reasonably  determine
could reasonably be expected to have a Material Adverse Effect.

         4.09 Security  Agreement Each Credit Party shall have duly  authorized,
executed  and  delivered  the  Security  Agreement  in the form of Exhibit E (as
modified,  supplemented or amended from time to time, the "Security  Agreement")
covering  all of such  Credit  Party's  present  and future  Security  Agreement
Collateral, together with:

         (i) proper Financing  Statements  (Form UCC-1 or the equivalent)  fully
    executed for filing  under the UCC or other  appropriate  filing  offices of
    each  jurisdiction as may be necessary or, in the reasonable  opinion of the
    Lender,  desirable to perfect the security interests purported to be created
    by the Security Agreement;

         (ii) copies of Requests for  Information  or Copies (Form  UCC-11),  or
    equivalent reports, listing all effective financing statements that name the
    Borrower  or any of its  Subsidiaries  as  debtor  and that are filed in the
    jurisdictions  referred to in clause (i) above, together with copies of such
    other financing statements that name the Borrower or any of its Subsidiaries
    as debtor  (none of which  shall cover any of the  Collateral  except to the
    extent  evidencing  Permitted  Liens or in respect of which the Lender shall
    have received termination  statements (Form UCC-3) or such other termination
    statements as shall be required by local law fully executed for filing);

         (iii)  evidence of the  completion of all other  recordings and filings
    of, or with  respect to, the Security  Agreement as may be necessary  or, in
    the  reasonable  opinion of the Lender,  desirable  to perfect the  security
    interests intended to be created by the Security Agreement; and

         (iv) evidence that all other  actions  necessary or, in the  reasonable
    opinion  of the  Lender,  desirable  to perfect  and  protect  the  security
    interests purported to be created by the Security Agreement have been taken.

                                       8
<PAGE>
         4.10 Subsidiaries  Guaranty.  Each Subsidiary Guarantor shall have duly
authorized,  executed and  delivered  the  Subsidiaries  Guaranty in the form of
Exhibit  F (as  amended,  modified  or  supplemented  from  time  to  time,  the
"Subsidiaries Guaranty").

         4.11 Financial Statements;  Pro Forma Balance Sheet;  Projections.  The
Lender shall have received true and correct copies of the  historical  financial
statements,  the pro forma  balance  sheet and the  Projections  referred  to in
Sections  5.05(a) and (d),  which  historical  financial  statements,  pro forma
balance  sheet  and  Projections  shall  be in  form  and  substance  reasonably
satisfactory to the Lender.

         4.12 Solvency  Certificate;  Insurance  Certificates.  The Lender shall
have received:

         (i)  a  solvency  certificate  from  the  chief  financial  officer  or
    president of the Borrower in the form of Exhibit G; and

         (ii)  certificates  of insurance  complying  with the  requirements  of
    Section  6.03  for the  business  and  properties  of the  Borrower  and its
    Subsidiaries,  in form and substance  reasonably  satisfactory to the Lender
    and  naming the  Lender as an  additional  insured  and as loss  payee,  and
    stating that such insurance  shall not be canceled  without at least 30 days
    (or 10 days in the case of  nonpayment of premium)  prior written  notice by
    the insurer to the Lender.

         4.13 No Default; Representations and Warranties.. (i) There shall exist
no Default or Event of  Default  at the time of the  incurrence  of the Loan and
also after giving effect  thereto and (ii) all  representations  and  warranties
contained  herein and in the other Credit Documents shall be true and correct in
all material  respects with the same effect as though such  representations  and
warranties  had been made on the Closing  Date (it being  understood  and agreed
that any representation or warranty which by its terms is made as of a specified
date shall be required to be true and correct in all material  respects  only as
of such specified date).

         The  occurrence of the Closing Date and the  incurrence by the Borrower
of the Loan  hereunder  on such  date  shall  constitute  a  representation  and
warranty  by the  Borrower to the Lender that all the  conditions  specified  in
Section 4 exist as of that time.  The Note,  certificates,  legal  opinions  and
other documents and papers referred to in Section 4 unless otherwise  specified,
shall be delivered to the Lender at the Notice Office for its own account and in
sufficient  counterparts  or copies  for the  Lender  and,  except as  otherwise
provided herein, shall be in form and substance  reasonably  satisfactory to the
Lender.

         SECTION 5.  Representations,  Warranties  and  Agreements.  In order to
induce the Lender to enter into this  Agreement and to make the Loan  hereunder,
the Borrower makes the following representations,  warranties and agreements, in
each case as of the Closing Date and after giving effect to the Transaction, all
of which shall  survive the  execution  and delivery of this  Agreement  and the
Notes and the making of the Loan,  and with the  occurrence  of the Closing Date
and the  incurrence  by the  Borrower of the Loan  hereunder  on such date being
deemed to constitute a representation and warranty that the matters specified in
this  Section 5 are true and correct in all  material  respects on and as of the
Closing Date (it being understood and agreed that

                                       9
<PAGE>
any representation or warranty which by its terms is made as of a specified date
shall be  required to be true and correct in all  material  respects  only as of
such specified date).

         5.01  Organizational  Status. The Borrower and each of its Subsidiaries
(i) is a duly organized and validly existing corporation, partnership or limited
liability  company,  as the case may be, in good standing  under the laws of the
jurisdiction of its organization, (ii) has the corporate, partnership or limited
liability  company power and authority,  as the case may be, to own its property
and assets and to transact  the  business  in which it is engaged and  presently
proposes to engage and (iii) is duly  qualified and is authorized to do business
and is in good standing in each  jurisdiction  where the  ownership,  leasing or
operation  of  its  property  or  the  conduct  of its  business  requires  such
qualifications except for failures to be so qualified which, either individually
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

         5.02  Power  and  Authority.  Each  Credit  Party  has  the  corporate,
partnership or limited  liability  company power and authority,  as the case may
be, to execute,  deliver and  perform  the terms and  provisions  of each of the
Documents  to  which  it  is  party  and  has  taken  all  necessary  corporate,
partnership  or  limited  liability  company  action,  as the  case  may be,  to
authorize  the  execution,  delivery  and  performance  by it of  each  of  such
Documents.  Each  Credit  Party  has duly  executed  and  delivered  each of the
Documents  to which it is  party,  and each of such  Documents  constitutes  its
legal,  valid and binding  obligation  enforceable in accordance with its terms,
except  to  the  extent  that  the  enforceability  thereof  may be  limited  by
applicable bankruptcy, insolvency,  reorganization,  moratorium or other similar
laws  generally  affecting   creditors'  rights  and  by  equitable   principles
(regardless of whether enforcement is sought in equity or at law).

         5.03 No Violation.  Neither the  execution,  delivery or performance by
any Credit Party of the Documents to which it is a party,  nor  compliance by it
with the terms and provisions thereof,  (i) will contravene any provision of any
law, statute, rule or regulation or any order, writ, injunction or decree of any
court or governmental instrumentality,  (ii) will conflict with or result in any
breach  of any  of  the  terms,  covenants,  conditions  or  provisions  of,  or
constitute a default  under,  or result in the creation or imposition of (or the
obligation  to create or  impose)  any Lien  (except  pursuant  to the  Security
Documents)  upon any of the  property  or assets of the  Borrower  or any of its
Subsidiaries  pursuant to the terms of any indenture,  mortgage,  deed of trust,
credit  agreement or loan agreement,  or, except as disclosed by the Borrower in
writing  to the  Lender on or prior to the  Closing  Date,  any  other  material
agreement,  contract or instrument, in each case to which the Borrower or any of
its  Subsidiaries  is a party or by which it or any of its property or assets is
bound or to which it may be subject or (iii) will  violate any  provision of the
certificate   or  articles   of   incorporation   or  by-laws   (or   equivalent
organizational documents) of the Borrower or any of its Subsidiaries.

         5.04 Approvals. No order, consent, approval, license,  authorization or
validation of, or filing,  recording or registration  with (except for (x) those
that have  otherwise  been  obtained or made on or prior to the Closing Date and
which remain in full force and effect on the Closing Date and (y) filings  which
are  necessary  to perfect the  security  interests  created  under the Security
Agreement,  which filings will be made within ten days after the Closing  Date),
or  exemption  by,  any  governmental  or  public  body  or  authority,  or  any
subdivision  thereof,  is required to  authorize,

                                       10
<PAGE>
or is required in connection  with, (i) the execution,  delivery and performance
of any Document or (ii) the legality, validity, binding effect or enforceability
of any such  Document  (other  than (x) in the case of clause  (i) above in this
Section  5.04,  such  orders,  consents,  approvals,  licenses,  authorizations,
validations, filings, recordings and registrations required to be made after the
Closing Date in order for the Borrower to be in compliance  with this Agreement,
which the  Borrower  will make or obtain when and as  required,  (y)  immaterial
orders, consents, approvals, licenses, authorizations or validations required in
connection with the Sale).

         5.05   Financial   Statements;    Financial   Condition;    Undisclosed
Liabilities;  Projections;  etc.  (a) The  consolidated  balance  sheets  of the
Borrower  for its fiscal years ended on October 1, 2000 and  September  26, 1999
and for its  nine-month  period  ended on July 1,  2001,  respectively,  and the
related  consolidated  statements of income, cash flows and shareholders' equity
of the Borrower for the fiscal years or six-month period ended on such dates, as
the case may be, copies of which have been  furnished to the Lender prior to the
Closing Date, present fairly in all material respects the consolidated financial
position  of  the  Borrower  at  the  dates  of  such  balance  sheets  and  the
consolidated  results of the operations of the Borrower for the periods  covered
thereby.  All of the  foregoing  financial  statements  have  been  prepared  in
accordance with generally accepted accounting  principles  consistently  applied
(except to the extent provided in the notes to such financial statements and, in
the case of the aforementioned nine month interim financial  statements,  except
for normal  year-end audit  adjustments  and the absence of footnotes).  The pro
forma  consolidated  balance  sheet of the Borrower as of July 1, 2001 and after
giving effect to the Transaction and the financing therefor, a copy of which has
been furnished to the Lender prior to the Closing Date,  presents  fairly in all
material respects the pro forma consolidated  financial position of the Borrower
as of July 1, 2001. After giving effect to the Transaction (but for this purpose
assuming that the  Transaction  and the related  financing had occurred prior to
October  1,  2000),  since  October  1,  2000,  there  has been no change in the
business,  operations,  property, assets,  liabilities,  condition (financial or
otherwise) or prospects of the Borrower or any of its Subsidiaries that has had,
or  could  reasonably  be  expected  to  have,  either  individually  or in  the
aggregate, a Material Adverse Effect, except as set forth in Schedule 4.07.

         (b) (i)  The sum of the  assets,  at a fair  valuation,  of each of the
Borrower on a stand-alone basis and the Borrower and its Subsidiaries taken as a
whole will  exceed its debts,  and (ii) each of the  Borrower  on a  stand-alone
basis and the  Borrower and its  Subsidiaries  taken as a whole has not incurred
and does not intend to incur,  and does not believe  that it will  incur,  debts
beyond its ability to pay such debts as such debts mature.  For purposes of this
Section  5.05(b),  "debt" means any liability on a claim,  and "claim" means (a)
right  to  payment,  whether  or not  such  a  right  is  reduced  to  judgment,
liquidated,  unliquidated,  fixed,  contingent,  matured,  unmatured,  disputed,
undisputed, legal, equitable, secured, or unsecured or (b) right to an equitable
remedy for breach of performance if such breach gives rise to a payment, whether
or not such  right  to an  equitable  remedy  is  reduced  to  judgment,  fixed,
contingent,  matured, unmatured, disputed, undisputed, secured or unsecured. The
amount of  contingent  liabilities  at any time shall be  computed as the amount
that,  in the light of all the facts and  circumstances  existing  at such time,
represents  the amount  that can  reasonably  be expected to become an actual or
matured liability.

         (c) Except as fully  disclosed in the  financial  statements  delivered
pursuant to Section 5.05(a) or as otherwise  permitted by this Agreement,  there
are no liabilities or obligations

                                       11
<PAGE>
(excluding  current  obligations  incurred in the ordinary course and consistent
with past practice) with respect to the Borrower or any of its  Subsidiaries  of
any nature whatsoever  (whether absolute,  accrued,  contingent or otherwise and
whether  or not due)  which,  either  individually  or in the  aggregate,  could
reasonably be expected to have a Material Adverse Effect.  The Borrower does not
know of any basis for the assertion against it or any of its Subsidiaries of any
liability or obligation  (excluding current obligations incurred in the ordinary
course and consistent  with past practice) of any nature  whatsoever that is not
fully  disclosed  in the  financial  statements  delivered  pursuant  to Section
5.05(a) which,  either  individually  or in the aggregate,  could  reasonably be
expected to have a Material Adverse Effect.

         (d) The  Projections  delivered to the Lender prior to the Closing Date
have been prepared in good faith and are based on reasonable assumptions made by
the  Borrower,  and there are no statements or  conclusions  in the  Projections
which  are  based  upon or  include  information  known  to the  Borrower  to be
misleading in any material  respect or which fail to take into account  material
information known to the Borrower  regarding the matters reported  therein.  The
Borrower  believes that the Projections are reasonable and attainable,  it being
recognized by the Lender,  however, that projections as to future events are not
to be viewed as facts and that the actual  results  during the period or periods
covered by the  Projections  may differ from the projected  results and that the
differences may be material.

         5.06 Litigation. There are no actions, suits or proceedings pending or,
to the best knowledge of the Borrower,  threatened that are, either individually
or in the aggregate, reasonably likely to have a Material Adverse Effect.

         5.07 True and Complete Disclosure.  All factual information (taken as a
whole)  furnished  by or on behalf of the  Borrower  in  writing  to the  Lender
(including,  without limitation, all information contained in the Documents) for
purposes of or in connection with this Agreement,  the other Credit Documents or
any  transaction  contemplated  herein or therein is, and all other such factual
information  (taken  as a whole)  hereafter  furnished  by or on  behalf  of the
Borrower  in writing to the Lender will be,  true and  accurate in all  material
respects on the date as of which such  information is dated or certified and not
incomplete  by omitting  to state any fact  necessary  to make such  information
(taken as a whole) not misleading in any material  respect at such time in light
of the circumstances under which such information was provided. It is understood
and agreed that the  Projections,  the pro forma  balance  sheet  required to be
delivered  pursuant  to Section  4.11 and the budgets  required to be  delivered
under Section  6.01(e) are not factual  information for purposes of this Section
5.07.

         5.08 Use of Proceeds; Margin Regulations.  (a) All proceeds of the Loan
will be used by the Borrower for (i) working capital purposes of the Borrower or
Subsidiary  Guarantors  of the  Borrower or (ii)  capital  expenditures  for the
direct and  immediate  benefit of the Borrower or  Subsidiary  Guarantors of the
Borrower.

         (b) No  part of the  Loan  (or the  proceeds  thereof)  will be used to
purchase  or carry any  Margin  Stock or to extend  credit  for the  purpose  of
purchasing or carrying any Margin Stock.  Neither the making of the Loan nor the
use of the proceeds thereof will violate or be

                                       12
<PAGE>
inconsistent  with  the  provisions  of  Regulation  T, U or X of the  Board  of
Governors of the Federal Reserve System.

         5.09 Tax Returns and  Payments.  Each of the  Borrower  and each of its
Subsidiaries has timely filed or caused to be timely filed all federal and state
income tax returns and all other  material  tax  returns,  domestic and foreign,
required to be filed by it and has paid all taxes and assessments  payable by it
which have  become  due,  except for  immaterial  taxes and taxes that are being
contested in good faith and for which adequate reserves have been established in
accordance with generally accepted  accounting  principles.  There is no action,
suit,  proceeding,  investigation,  audit,  or claim now pending or, to the best
knowledge of the  Borrower  threatened,  by any  authority  regarding  any taxes
relating to the Borrower or any of its Subsidiaries that either  individually or
in the aggregate could reasonably be expected to result in a material  liability
to the Borrower or any of its Subsidiaries.  Neither the Borrower nor any of its
Subsidiaries  has entered into an agreement or waiver or been requested to enter
into an agreement or waiver extending any statute of limitations relating to the
payment or collection of taxes of the Borrower or any of its Subsidiaries, or is
aware of any  circumstances  that would cause the taxable years or other taxable
periods  of the  Borrower  or any of its  Subsidiaries  not to be subject to the
normally applicable statute of limitations.  Neither the Borrower nor any of its
Subsidiaries has provided,  with respect to themselves or property held by them,
any consent  under  Section 341 of the Code.  Neither of the Borrower nor any of
its  Subsidiaries  has  incurred,  or will incur,  any material tax liability in
connection with the Transaction.

         5.10  Compliance  with ERISA.  (i)  Schedule III sets forth the name of
each Plan. Each Plan (and each related trust,  insurance contract or fund) is in
substantial  compliance with its terms and with all applicable laws,  including,
without limitation,  ERISA and the Code; the Borrower is not aware of any reason
why each Plan (and each related trust, if any) which is intended to be qualified
under Section 401(a) of the Code would not receive a  determination  letter from
the Internal  Revenue  Service to the effect that it meets the  requirements  of
Sections  401(a) and 501(a) of the Code if an application for such a letter were
made; no Reportable  Event has occurred;  no Plan which is a multiemployer  plan
(as defined in Section  4001(a)(3) of ERISA) is insolvent or in  reorganization;
no Plan has an Unfunded  Current  Liability  which,  when added to the aggregate
amount of Unfunded Current  Liabilities with respect to all other Plans,  exceed
$500,000;  no Plan which is subject to Section 412 of the Code or Section 302 of
ERISA has an accumulated funding deficiency, within the meaning of such sections
of the Code or ERISA,  or has applied for or received a waiver of an accumulated
funding  deficiency  or an  extension  of any  amortization  period,  within the
meaning  of  Section  412 of the  Code  or  Section  303  or 304 of  ERISA;  all
contributions  required to be made with respect to a Plan have been timely made;
neither the Borrower nor any Subsidiary of the Borrower nor any ERISA  Affiliate
has incurred any material  liability  (including  any  indirect,  contingent  or
secondary liability) to or on account of a Plan pursuant to Section 409, 502(i),
502(l),  515, 4062,  4063,  4064,  4069,  4201, 4204 or 4212 of ERISA or Section
401(a)(29),  4971 or 4975 of the  Code or  expects  to incur  any such  material
liability  under any of the  foregoing  sections with respect to any Plan (other
than  liabilities of any ERISA  Affiliate which could not by operation of law or
otherwise  become a liability  of the Borrower or any of its  Subsidiaries);  no
condition  exists  which  presents  a  material  risk  to  the  Borrower  or any
Subsidiary  of the  Borrower  or any ERISA  Affiliate  of  incurring  a material
liability to or on account of a Plan  pursuant to the  foregoing  provisions  of
ERISA and the Code;

                                       13
<PAGE>
no  proceedings  have been  instituted  to  terminate  or  appoint a trustee  to
administer  any Plan  which is subject  to Title IV of ERISA;  no action,  suit,
proceeding,  hearing, audit or investigation with respect to the administration,
operation or the investment of assets of any Plan (other than routine claims for
benefits) is pending,  expected or threatened;  using actuarial  assumptions and
computation  methods  consistent with Part 1 of subtitle E of Title IV of ERISA,
the aggregate  liabilities  of the Borrower and its  Subsidiaries  and its ERISA
Affiliates  to all Plans  which are  multiemployer  plans (as defined in Section
4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom,  as of the
close of the most  recent  fiscal  year of each  such  Plan,  would  not  exceed
$500,000;  each group  health  plan (as  defined  in Section  607(1) of ERISA or
Section 4980B(g)(2) of the Code) which covers or has covered employees or former
employees  of the  Borrower,  any  Subsidiary  of  the  Borrower,  or any  ERISA
Affiliate  has at all  times  been  operated  in  material  compliance  with the
provisions  of Part 6 of subtitle B of Title I of ERISA and Section 4980B of the
Code;  no lien imposed  under the Code or ERISA on the assets of the Borrower or
any  Subsidiary  of the Borrower or any ERISA  Affiliate  exists or is likely to
arise on account of any Plan;  and the Borrower and its  Subsidiaries  may cease
contributions  to or terminate  any employee  benefit plan  maintained by any of
them without incurring any material liability.

         (ii)  The  Borrower  and its  Subsidiaries  have not  entered  into any
Foreign  Pension  Plan,  nor have  incurred  any  obligation(s)  pursuant to any
Foreign Pension Plan.

         5.11 The Security  Documents.  The provisions of the Security Agreement
are  effective to create in favor of the Lender a legal,  valid and  enforceable
security interest in all right,  title and interest of the Credit Parties in the
Security  Agreement  Collateral  described  therein,  and,  subject  to  Section
6.10(d), the Lender has (or within 10 days following the Closing Date will have)
a fully perfected first lien on, and security interest in, all right,  title and
interest in all of the Security Agreement Collateral described therein,  subject
to no other Liens other than Permitted Liens.

         5.12   Representations   and   Warranties   in   the   Documents.   All
representations  and warranties set forth in the other Documents (other than the
Credit  Documents) were true and correct in all material respects at the time as
of which such  representations  and  warranties  were made (or deemed  made) and
shall be true and correct in all material  respects as of the Closing Date as if
such  representations  and warranties  were made on and as of such date,  unless
stated to relate to a specific earlier date, in which case such  representations
and  warranties  shall be true and correct in all  material  respects as of such
earlier date,  except to the extent that the failure of any such  representation
or warranty to be true and current in all material respects, either individually
or in the aggregate,  could not reasonably be expected to have Material  Adverse
Effect.

         5.13  Properties.  All Real Property owned or leased by the Borrower or
any Subsidiary Guarantors,  and the nature of the interest therein, is correctly
set forth in Schedule IV. Each of the Borrower and each Subsidiary Guarantor has
good and marketable title to all material  properties owned by it, including all
material  property  reflected  in Schedule IV and in the most recent  historical
balance  sheet  referred  to in Section  5.05(a)  (except  as sold or  otherwise
disposed  of since  the date of such  balance  sheet in the  ordinary  course of
business or as permitted by the terms of this Agreement),  free and clear of all
Liens, other than Permitted Liens.

                                       14
<PAGE>
         5.14  Capitalization;  Newly  Issued  Securities.  (a)  The  authorized
capital  stock of the  Borrower  consist,  of (i)  100,000,000  shares of common
stock,  $0.01 par value per share, of which  28,069,282  (after giving effect to
the  issuance  contemplated  by the Sale  Documents)  shares shall be issued and
outstanding, and (ii) 1,000 shares of preferred stock, $.01 par value per share,
of which none are issued and outstanding.  All outstanding shares of the capital
stock of the Borrower  have been duly and validly  issued and are fully paid and
non-assessable.   The  Borrower  does  not  have   outstanding   any  securities
convertible into or exchangeable for its capital stock or outstanding any rights
to  subscribe  for or to  purchase,  or any options for the  purchase of, or any
agreement providing for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character  relating to, its capital  stock,  except
for options,  warrants and rights to purchase  shares of the  Borrower's  common
stock which have been issued.

         (b) The shares of equity securities to be issued upon conversion of the
Note (the  "Conversion  Shares") have been duly authorized and validly  reserved
for issuance in  contemplation  of conversion of the Note pursuant to Section 10
hereof and, when issued and delivered in accordance  with this  Agreement,  will
have been validly issued, fully paid and non-assessable. The Lender will acquire
good and marketable  title to the Conversion  Shares upon conversion of the Note
pursuant to Section 10 hereof,  free and clear of any and all Liens, except such
Liens as may exist under the Credit Documents.

         5.15  Subsidiaries.  The Borrower has no Subsidiaries  other than those
Subsidiaries  listed  on  Schedule  V.  Schedule  V  correctly  sets  forth  the
percentage  ownership  (direct or  indirect)  of the  Borrower  in each class of
capital stock or other equity of its Subsidiaries and also identifies the direct
owner thereof.

         5.16  Compliance  with Statutes,  etc. Each of the Borrower and each of
its Subsidiaries is in compliance with all applicable statutes,  regulations and
orders of, and all applicable  restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of  its  property   (including,   without   limitation,   applicable   statutes,
regulations,  orders and restrictions  relating to  environmental  standards and
controls),  except such  noncompliances as could not, either  individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.

         5.17  Investment  Company  Act.  Neither  the  Borrower  nor any of its
Subsidiaries  is  an  "investment  company"  or a  company  "controlled"  by  an
"investment  company," within the meaning of the Investment Company Act of 1940,
as amended.

         5.18 Public Utility Holding  Company Act.  Neither the Borrower nor any
of its  Subsidiaries  is a "holding  company,"  or a  "subsidiary  company" of a
"holding  company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company" within the meaning of the Public Utility Holding
Company Act of 1935, as amended.

         5.19  Environmental  Matters.  (a) Each of the Borrower and each of its
Subsidiary  Guarantors is in compliance with all applicable  Environmental  Laws
and the requirements of any permits issued under such Environmental  Laws. There
are  no  pending  or,  to  the  best  knowledge  of  the  Borrower,   threatened
Environmental Claims against the Borrower or any of its Subsidiary

                                       15
<PAGE>
Guarantors or any Real Property owned, leased or operated by the Borrower or any
of its  Subsidiary  Guarantors  (including  any such  claim  arising  out of the
ownership,  lease  or  operation  by the  Borrower  or  any  of  its  Subsidiary
Guarantors  of any Real  Property  formerly  owned by the Borrower or any of its
Subsidiary Guarantors but no longer owned, leased or operated by the Borrower or
any of its Subsidiary Guarantors). There are no facts, circumstances, conditions
or occurrences with respect to the business or operations of the Borrower or any
of its Subsidiary Guarantors,  or any Real Property owned, leased or operated by
the  Borrower  or any of  its  Subsidiary  Guarantors  (including,  to the  best
knowledge of the Borrower,  any Real Property formerly owned, leased or operated
by the Borrower or any of its Subsidiary  Guarantors but no longer owned, leased
or operated by the Borrower or any of its Subsidiary Guarantors) or, to the best
knowledge of the Borrower,  any property  adjoining or adjacent to any such Real
Property  that  could  be  reasonably  expected  (i) to  form  the  basis  of an
Environmental Claim against the Borrower or any of its Subsidiary  Guarantors or
any Real  Property  owned,  leased or  operated  by the  Borrower  or any of its
Subsidiary  Guarantors  or (ii) to cause  any Real  Property  owned,  leased  or
operated by the Borrower or any of its  Subsidiary  Guarantors  to be subject to
any restrictions on the ownership,  lease,  occupancy or transferability of such
Real  Property by the  Borrower or any of its  Subsidiary  Guarantors  under any
applicable Environmental Law.

         (b)  Hazardous  Materials  have not at any time been  generated,  used,
treated or stored on, or transported to or from, any Real Property owned, leased
or  operated  by the  Borrower or any of its  Subsidiary  Guarantors  where such
generation,  use,  treatment,  storage or  transportation  has violated or could
reasonably  be  expected  to violate  any  Environmental  Law or give rise to an
Environmental  Claim.  Hazardous Materials have not at any time been Released on
or from any Real  Property  owned,  leased or operated by the Borrower or any of
its Subsidiary Guarantors where such Release has violated or could reasonably be
expected to violate any applicable Environmental Law.

         (c) Notwithstanding  anything to the contrary in this Section 5.19, the
representations  and  warranties  made in this  Section 5.19 shall not be untrue
unless the effect of any or all conditions,  violations,  claims,  restrictions,
failures  and  non-compliances  of  the  types  described  above  could,  either
individually  or in the  aggregate,  reasonably  be  expected to have a Material
Adverse Effect.

         5.20 Labor Relations.  Neither the Borrower nor any of its Subsidiaries
is engaged in any unfair labor  practice  that could  reasonably be expected to,
either individually or in the aggregate,  have a Material Adverse Effect.  There
is (i) no unfair labor practice complaint pending against the Borrower or any of
its Subsidiaries or, to the best knowledge of the Borrower,  threatened  against
any of them,  before the National  Labor  Relations  Board,  and no grievance or
arbitration  proceeding  arising  out  of or  under  any  collective  bargaining
agreement is so pending against the Borrower or any of its  Subsidiaries  or, to
the best  knowledge of the  Borrower,  threatened  against any of them,  (ii) no
strike, labor dispute,  slowdown or stoppage pending against the Borrower or any
of its  Subsidiaries  or,  to the best  knowledge  of the  Borrower,  threatened
against  the   Borrower  or  any  of  its   Subsidiaries   and  (iii)  no  union
representation  question exists with respect to the employees of the Borrower or
any of its Subsidiaries,  except (with respect to any matter specified in clause
(i), (ii) or (iii) above, either individually or in the aggregate) such as could
not reasonably be expected to have a Material Adverse Effect.

                                       16
<PAGE>
         5.21 Patents,  Licenses,  Franchises and Formulas. Each of the Borrower
and  each of its  Subsidiaries  owns or has the  right  to use all the  patents,
trademarks,   permits,  service  marks,  trade  names,   copyrights,   licenses,
franchises,  proprietary  information  (including  but not  limited to rights in
computer  programs and  databases)  and formulas,  or rights with respect to the
foregoing, and has obtained assignments of all leases, licenses and other rights
of whatever nature,  necessary for the present conduct of its business,  without
any known  conflict  with the rights of others  which,  or the failure to obtain
which, as the case may be, could reasonably be expected,  either individually or
in the aggregate, to result in a Material Adverse Effect.

         5.22  Indebtedness.  Schedule VI sets forth a true and complete list of
all  Indebtedness  (including  Contingent  Obligations)  of the Borrower and its
Subsidiaries  which  is  to  remain  outstanding  after  giving  effect  to  the
Transaction  (excluding  the Loan,  the "Existing  Indebtedness"),  in each case
showing the aggregate  principal  amount  thereof and the name of the respective
borrower  and  the  Borrower  or any  of  its  Subsidiaries  which  directly  or
indirectly guarantees such debt.

         5.23 Transaction.  At the time of consummation thereof, the Transaction
shall have been  consummated  in all material  respects in  accordance  with the
terms  of the  respective  Documents  and all  applicable  laws.  At the time of
consummation   thereof,   all  consents  and   approvals  of,  and  filings  and
registrations  with,  and all other  actions  in respect  of,  all  governmental
agencies,  authorities or instrumentalities  required in order to consummate the
Transaction have been obtained, given, filed or taken and are or will be in full
force and effect (or  effective  judicial  relief with respect  thereto has been
obtained)  (other than as expressly set forth in Section  5.04).  All applicable
waiting  periods with respect  thereto have or, prior to the time when required,
will have,  expired  without,  in all such cases,  any action being taken by any
competent  authority which  restrains,  prevents,  or imposes  material  adverse
conditions  upon  the  Transaction.  Additionally,  there  does  not  exist  any
judgment,   order  or  injunction   prohibiting  or  imposing  material  adverse
conditions upon the Transaction,  or the incurrence of the Loan hereunder or the
performance by any Credit Party of its obligations  under the Documents to which
it is party.

         5.24 Insurance.  Schedule VII sets forth a true and complete listing of
all insurance maintained by the Borrower and its Subsidiaries,  with the amounts
insured (and any deductibles) set forth therein.

         SECTION 6.  Affirmative  Covenants.  The Borrower hereby  covenants and
agrees  that on and  after  the  Closing  Date and  until  the Loan and the Note
(together  with  interest  thereon),  and  all  other  Obligations  (other  than
indemnities  described  in  Section  11.12  which are not then due and  payable)
incurred hereunder and thereunder, are paid in full:

         6.01 Information Covenants. The Borrower will furnish to the Lender:

         (a) Monthly Reports.  Within 30 days after the end of each fiscal month
of the Borrower  (commencing  with its fiscal month ending on August 26,  2001),
the  consolidated  and  consolidating  balance  sheet  of the  Borrower  and its
Subsidiaries  as at the end of such fiscal  month and the  related  consolidated
statements  of income and  statement of cash flows for such fiscal month and for
the  elapsed  portion of the fiscal  year ended with the last day of such fiscal
month,

                                       17
<PAGE>
in each case setting  forth  comparative  figures for the  corresponding  fiscal
month in the prior fiscal year and comparable  budgeted  figures for such fiscal
month,  all of which shall be  certified by the chief  financial  officer of the
Borrower that they fairly  present in all material  respects in accordance  with
generally accepted accounting principles the financial condition of the Borrower
and its  Subsidiaries  as of the  dates  indicated  and  the  results  of  their
operations  for  the  periods  indicated,   subject  to  normal  year-end  audit
adjustments and the absence of footnotes.

         (b) Quarterly Financial  Statements.  Within 45 days after the close of
the  first  three  quarterly  accounting  periods  in  each  fiscal  year of the
Borrower,  (i) the consolidated and consolidating  balance sheet of the Borrower
and its Subsidiaries as at the end of such quarterly  accounting  period and the
related  consolidated  and  consolidating  statements  of  income  and  retained
earnings,  and (in any  event)  the  related  statement  of cash  flows for such
quarterly accounting period and for the elapsed portion of the fiscal year ended
with the last day of such  quarterly  accounting  period,  in each case  setting
forth comparative  figures for the related periods in the prior fiscal year, all
of which shall be certified by the chief financial  officer of the Borrower that
they fairly  present in all  material  respects  in  accordance  with  generally
accepted  accounting  principles the financial condition of the Borrower and its
Subsidiaries as of the dates  indicated and the results of their  operations for
the periods  indicated,  subject to normal  year-end audit  adjustments  and the
absence of footnotes, and (ii) management's brief discussion and analysis of the
important   operational  and  financial   developments   during  such  quarterly
accounting period.

         (c) Annual Financial Statements. Within 90 days after the close of each
fiscal year of the Borrower,  (i) the  consolidated  and  consolidating  balance
sheet of the Borrower and its Subsidiaries as at the end of such fiscal year and
the  related  consolidated  statements  of  income  and  retained  earnings  and
statement of cash flows for such fiscal year setting forth  comparative  figures
for the preceding fiscal year and certified by Deloitte & Touche,  LLP, any "Big
Five"  independent  certified  public  accounting firm or any other  independent
certified  public  accountants  of  recognized   national  standing   reasonably
acceptable to the Lender, together with a report of such accounting firm stating
that in the  course of its  regular  audit of the  financial  statements  of the
Borrower and its  Subsidiaries,  which audit was  conducted in  accordance  with
generally  accepted  auditing  standards,   such  accounting  firm  obtained  no
knowledge of any Default or an Event of Default insofar as such Default or Event
of Default relates to financial or accounting  matters which has occurred and is
continuing or, if in the opinion of such accounting firm such a Default or Event
of Default has occurred and is continuing, a statement as to the nature thereof,
and (ii) management's  discussion and analysis of the important  operational and
financial developments during such fiscal year.

         (d)  Management  Letters.  Promptly  after the Borrower's or any of its
Subsidiaries'  receipt thereof, a copy of any "management  letter" received from
its certified public accountants and management's response thereto.

         (e)  Budgets.  No later  than 30 days  following  the first day of each
fiscal year of the Borrower,  a budget in form  reasonably  satisfactory  to the
Lender (including  budgeted  statements of income,  sources and uses of cash and
balance  sheets)  prepared by the Borrower for each of the twelve months of such
fiscal year prepared in detail,  in each case setting  forth,  with  appropriate
discussions, the principal assumptions upon which such budgets are based.

                                       18
<PAGE>
         (f)  Officer's  Certificates.  At  the  time  of  the  delivery  of the
financial statements provided for in Section 6.01(a), (b) and (c), a certificate
of the chief  financial  officer  of the  Borrower  certifying  on behalf of the
Borrower that, to the best of such officer's  knowledge,  no Default or Event of
Default has  occurred and is  continuing  or, if any Default or Event of Default
has occurred and is continuing,  specifying the nature and extent thereof, which
certificate shall (i) set forth in reasonable  detail the calculations  required
to establish  whether the Borrower and its Subsidiaries  were in compliance with
the provisions of Sections 7.02(iv), 7.03(iii), 7.04(iv),  7.04(viii),  7.05(v),
7.05(xiv) and 7.07,  at the end of such fiscal  quarter or year, as the case may
be (it being understood that the calculations to determine  compliance with each
of the respective  clauses under any of such Sections 7.02,  7.03, 7.04 and 7.05
need only set forth the  aggregate  amount of  transactions  that have  occurred
during the respective reporting period under each such clause), and (ii) certify
that there have been no changes to Annexes A through E of the Security Agreement
since  the  Closing  Date or,  if  later,  since  the  date of the  most  recent
certificate  delivered  pursuant to this Section 6.01(f),  or if there have been
any such changes, a list in reasonable detail of such changes.

         (g)  Notice  of  Default,   Litigation  and  Material  Adverse  Effect.
Promptly,  and in any event within five  Business  Days after any officer of the
Borrower obtains  knowledge  thereof,  notice of (i) the occurrence of any event
which  constitutes a Default or an Event of Default,  or (ii) any  litigation or
governmental  investigation or proceeding pending against the Borrower or any of
its  Subsidiaries  which could reasonably be expected to have a Material Adverse
Effect.

         (h) Other  Reports and Filings.  Promptly  after the filing or delivery
thereof,  copies of all financial  information,  proxy materials and reports, if
any, which the Borrower or any of its Subsidiary  Guarantors shall publicly file
with the Securities and Exchange Commission or any successor thereto (the "SEC")
or deliver to holders (or any trustee,  agent or other representative  therefor)
of its  material  Indebtedness  (excluding  Capitalized  Lease  Obligations  and
purchase money  Indebtedness  incurred pursuant to Section 7.04(iv)) pursuant to
the terms of the documentation governing such material Indebtedness.

         (i) Environmental  Matters.  Promptly after any officer of the Borrower
obtains knowledge thereof,  notice of one or more of the following environmental
matters,  unless such  environmental  matters could not, either  individually or
when  aggregated  with all  other  such  environmental  matters,  be  reasonably
expected to have a Material Adverse Effect:

         (i) any pending or threatened  Environmental Claim against the Borrower
    or any of its Subsidiary  Guarantors or any Real Property  owned,  leased or
    operated by the Borrower or any of its Subsidiary Guarantors;

         (ii) any  condition or  occurrence on or arising from any Real Property
    owned,  leased  or  operated  by the  Borrower  or  any  of  its  Subsidiary
    Guarantors that (a) results in  noncompliance  by the Borrower or any of its
    Subsidiary Guarantors with any applicable  Environmental Law or (b) could be
    expected to form the basis of an Environmental Claim against the Borrower or
    any of its Subsidiary Guarantors or any such Real Property;

                                       19
<PAGE>
         (iii) any condition or occurrence on any Real Property owned, leased or
    operated by the Borrower or any of its Subsidiary  Guarantors  that could be
    expected to cause such Real  Property to be subject to any  restrictions  on
    the ownership,  lease, occupancy,  use or transferability by the Borrower or
    any  of  its   Subsidiary   Guarantors  of  such  Real  Property  under  any
    Environmental Law; and

         (iv) the taking of any  removal or  remedial  action in response to the
    actual or alleged  presence of any  Hazardous  Material on any Real Property
    owned,  leased  or  operated  by the  Borrower  or  any  of  its  Subsidiary
    Guarantors as required by any Environmental Law or any governmental or other
    administrative agency; provided that in any event the Borrower shall deliver
    to the Lender all notices  received by the Borrower or any of its Subsidiary
    Guarantors from any government or governmental agency under, or pursuant to,
    CERCLA which  identify the Borrower or any of its  Subsidiary  Guarantors as
    potentially  responsible  parties for  redemption  costs or which  otherwise
    notify  the  Borrower  or any  of its  Subsidiary  Guarantors  of  potential
    liability under CERCLA.

All such notices shall  describe in  reasonable  detail the nature of the claim,
investigation,  condition,  occurrence  or  removal or  remedial  action and the
Borrower's or such Subsidiary's response thereto.

         (j) Other  Information.  From time to time,  such other  information or
documents  (financial or  otherwise)  with respect to the Borrower or any of its
Subsidiaries as the Lender may reasonably request.

         6.02 Books, Records and Inspections.  The Borrower will, and will cause
each of its  Subsidiaries  to, keep proper books of record and accounts in which
full, true and correct entries in conformity with generally accepted  accounting
principles  and all  requirements  of law  shall  be made  of all  dealings  and
transactions in relation to its business and activities.  The Borrower will, and
will cause each of its Subsidiary  Guarantors to, permit officers and designated
representatives  of the Lender to visit and inspect,  under guidance of officers
of the Borrower or such  Subsidiary,  any of the  properties  of the Borrower or
such Subsidiary (although, so long as no Default or Event of Default then exists
and is  continuing,  the Lender may not conduct more than two such visits in any
fiscal  year of the  Borrower),  and to  examine  the  books of  account  of the
Borrower or such  Subsidiary  and discuss the affairs,  finances and accounts of
the Borrower or such Subsidiary  with, and be advised as to the same by, its and
their officers and independent  accountants (so long as the Borrower is afforded
an  opportunity  to be present),  all upon  reasonable  prior notice and at such
reasonable times as the Lender may reasonably request

         6.03  Maintenance  of Property;  Insurance.  (a) The Borrower will, and
will cause each of its Subsidiaries  to, (i) keep all property  necessary to the
business of the Borrower and its  Subsidiaries  in reasonably good working order
and  condition,  ordinary  wear and tear and damage by casualty  excepted,  (ii)
maintain with financially sound and reputable  insurance  companies insurance on
all such property in at least such amounts and against at least such risks as is
consistent  and in  accordance  with industry  practice for companies  similarly
situated  owning  similar  properties  in the same  general  areas in which  the
Borrower or any of its  Subsidiaries  operates,  and (iii) furnish to the Lender
full information as to the insurance  carried.  At any time

                                       20
<PAGE>
that  insurance  at or above the levels  described  on Schedule VII is not being
maintained by the Borrower or any Subsidiary of the Borrower, the Borrower will,
or will cause one of its  Subsidiaries to, promptly notify the Lender in writing
and, if thereafter  reasonably requested by the Lender to do so, the Borrower or
any such  Subsidiary,  as the case may be, shall  obtain such  insurance at such
levels and coverage  which are at least as great as those  described in Schedule
VII to the extent such insurance is available at commercially reasonable rates.

         (b) The Borrower will, and will cause each of its Subsidiary Guarantors
to, at all times  keep its  property  insured  in favor of the  Lender,  and all
policies or  certificates  (or  certified  copies  thereof) with respect to such
insurance  (and any other  insurance  maintained  by the  Borrower  and/or  such
Subsidiary   Guarantors  (i)  shall  be  endorsed  to  the  Lender's  reasonable
satisfaction for the benefit of the Lender (including,  without  limitation,  by
naming the Lender as loss payee  and/or  additional  insured),  (ii) shall state
that such insurance policies shall not be canceled without at least 30 days' (or
10 days, in the case of nonpayment of premium)  prior written  notice thereof by
the  respective  insurer  to the Lender and (iii)  shall be  deposited  with the
Lender.

         (c) If the Borrower or any of its Subsidiary  Guarantors  shall fail to
insure its property in accordance  with this Section 6.03, or if the Borrower or
any of its  Subsidiary  Guarantors  shall fail to so  endorse  and  deposit  all
policies or certificates  with respect thereto,  the Lender shall have the right
(but shall be under no  obligation)  to procure such  insurance and the Borrower
agrees  to  reimburse  the  Lender  for all  reasonable  costs and  expenses  of
procuring such insurance.

         6.04 Existence;  Franchises.  The Borrower will, and will cause each of
its  Subsidiaries  to, do or cause to be done, all things  necessary to preserve
and keep in full  force  and  effect  its  existence  and its  material  rights,
franchises,  licenses  and  patents;  provided,  however,  that  nothing in this
Section  6.04 shall  prevent (i) sales of assets and other  transactions  by the
Borrower or any of its  Subsidiaries in accordance with Section 7.02 or (ii) the
withdrawal by the Borrower or any of its Subsidiaries of its  qualification as a
foreign  corporation in any jurisdiction where such withdrawal could not, either
individually  or in the  aggregate,  reasonably  be  expected to have a Material
Adverse Effect.

         6.05 Compliance  with Statutes,  etc. The Borrower will, and will cause
each of its  Subsidiaries to, comply with all applicable  statutes,  regulations
and orders of, and all  applicable  restrictions  imposed  by, all  governmental
bodies,  domestic or foreign,  in respect of the conduct of its business and the
ownership of its property (including  applicable statutes,  regulations,  orders
and restrictions relating to environmental standards and controls),  except such
noncompliances as could not, either individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.

         6.06 Compliance with Environmental  Laws. (a) The Borrower will comply,
and will cause each of its Subsidiaries to comply,  with all Environmental  Laws
and permits  applicable to, or required by, the  ownership,  lease or use of its
Real Property now or hereafter owned,  leased or operated by the Borrower or any
of  its  Subsidiaries,   except  such   non-compliances  as  could  not,  either
individually  or in the  aggregate,  reasonably  be  expected to have a Material
Adverse Effect,

                                       21
<PAGE>
and will  promptly  pay or cause to be paid all costs and  expenses  incurred in
connection with such compliance, and will keep or cause to be kept all such Real
Property  free and clear of any Liens  imposed  pursuant  to such  Environmental
Laws.  Neither the  Borrower nor any of its  Subsidiaries  will  generate,  use,
treat, store,  Release or dispose of, or permit the generation,  use, treatment,
storage,  Release or disposal of Hazardous Materials on any Real Property now or
hereafter owned,  leased or operated by the Borrower or any of its Subsidiaries,
or transport or permit the transportation of Hazardous  Materials to or from any
such Real Property,  except for Hazardous  Materials  generated,  used, treated,
stored, Released or disposed of at any such Real Properties in compliance in all
material  respects  with all  applicable  Environmental  Laws and as required in
connection  with the normal  operation,  use and  maintenance of the business or
operations of the Borrower or any of its Subsidiaries.

         (b) (i)  After the  receipt  by the  Lender  of any  notice of the type
described in Section  6.01(i),  (ii) at any time that the Borrower or any of its
Subsidiary Guarantors are not in compliance with Section 6.06(a) or (b) or (iii)
in the event that the Lender shall have  exercised any of its remedies  pursuant
to the last paragraph of Section 8, the Borrower will (in each case) provide, at
the sole  expense  of the  Borrower  and  upon the  request  of the  Lender,  an
environmental site assessment report concerning any Real Property owned,  leased
or operated by the Borrower or any of its Subsidiary Guarantors,  prepared by an
environmental consulting firm reasonably approved by the Lender,  indicating the
presence or absence of Hazardous Materials and the potential cost of any removal
or remedial  action in  connection  with such  Hazardous  Materials on such Real
Property.  If the  Borrower  fails to  provide  same  within 90 days  after such
request  was made,  the  Lender may order the same,  the cost of which  shall be
borne by the  Borrower  and the  Borrower  shall  grant and hereby  grant to the
Lender and its agents  access to such Real Property and  specifically  grant the
Lender an irrevocable  non-exclusive license,  subject to the rights of tenants,
to undertake such an assessment at any reasonable time upon reasonable notice to
the Borrower, all at the sole expense of the Borrower.

         6.07 ERISA. As soon as possible and, in any event, within ten (10) days
after the Borrower,  any Subsidiary of the Borrower or any ERISA Affiliate knows
or has reason to know of the  occurrence of any of the  following,  the Borrower
will deliver to the Lender a certificate of the chief  financial  officer of the
Borrower  setting forth in reasonable  detail  information as to such occurrence
and the  action,  if any,  that the  Borrower,  such  Subsidiary  or such  ERISA
Affiliate is required or proposes to take, together with any notices received by
or required or  proposed  to be given to or filed with or by the  Borrower,  the
Subsidiary,  the ERISA Affiliate,  the PBGC or any other governmental  agency, a
Plan  participant  or  the  Plan  administrator  with  respect  thereto:  that a
Reportable  Event has  occurred  (except to the  extent  that the  Borrower  has
previously delivered to the Lender a certificate and notices (if any) concerning
such event pursuant to the next clause hereof);  that a contributing sponsor (as
defined in Section  4001(a)(13) of ERISA) of a Plan subject to Title IV of ERISA
is subject to the  advance  reporting  requirement  of PBGC  Regulation  Section
4043.61 (without regard to subparagraph (b)(1) thereof),  and an event described
in subsection  .62, .63,  .64, .65, .66, .67 or .68 of PBGC  Regulation  Section
4043 is  reasonably  expected  to occur  with  respect  to such Plan  within the
following 30 days; that an accumulated funding deficiency, within the meaning of
Section  412 of the  Code or  Section  302 of  ERISA,  has been  incurred  or an
application  may be or has been made for a waiver or modification of the minimum
funding standard (including any required  installment  payments) or an extension
of any

                                       22
<PAGE>
amortization period under Section 412 of the Code or Section 303 or 304 of ERISA
with respect to a Plan; that any  contribution  required to be made with respect
to a Plan or Foreign Pension Plan has not been timely made; that a Plan has been
or may be terminated, reorganized, partitioned or declared insolvent under Title
IV of ERISA;  that a Plan has an Unfunded Current Liability which, when added to
the aggregate amount of Unfunded  Current  Liabilities with respect to all other
Plans,  exceed  $500,000;  that  proceedings  may be or have been  instituted to
terminate or appoint a trustee to administer a Plan which is subject to Title IV
of ERISA; that a proceeding has been instituted pursuant to Section 515 of ERISA
to  collect  a  delinquent  contribution  to a  Plan;  that  the  Borrower,  any
Subsidiary of the Borrower or any ERISA Affiliate will or may incur any material
liability (including any indirect,  contingent, or secondary liability) to or on
account of the  termination  of or  withdrawal  from a Plan under  Section 4062,
4063,  4064,  4069,  4201, 4204 or 4212 of ERISA or with respect to a Plan under
Section  401(a)(29),  4971,  4975 or 4980 of the Code or Section 409,  502(i) or
502(l) of ERISA or with  respect to a group  health  plan (as defined in Section
607(1) of ERISA or Section  4980B(g)(2)  of the Code) under Section 4980B of the
Code;  or that the  Borrower or any  Subsidiary  of the  Borrower  may incur any
material  liability pursuant to any employee welfare benefit plan (as defined in
Section  3(1) of ERISA) that  provides  benefits to retired  employees  or other
former employees (other than as required by Section 601 of ERISA) or any Plan or
any Foreign  Pension Plan. The Borrower will deliver to the Lender copies of any
records,  documents or other information that must be furnished to the PBGC with
respect to any Plan  pursuant to Section 4010 of ERISA.  The Borrower  will also
deliver,  upon the request of the Lender,  a complete  copy of the annual report
(on Internal Revenue Service Form  5500-series) of each Plan (including,  to the
extent required, the related financial and actuarial statements and opinions and
other supporting statements, certifications, schedules and information) required
to be filed with the Internal Revenue  Service.  In addition to any certificates
or notices delivered to the Lender pursuant to the first sentence hereof, copies
of any material records, documents or other information required to be furnished
to the PBGC or any other governmental  agency, and any material notices received
by the  Borrower,  any  Subsidiary of the Borrower or any ERISA  Affiliate  with
respect to any Plan or Foreign  Pension Plan shall be delivered to the Lender no
later  than  ten (10)  days  after  the  date  such  records,  documents  and/or
information has been furnished to the PBGC or any other  governmental  agency or
such notice has been received by the Borrower,  the respective Subsidiary or the
ERISA  Affiliate,  as  applicable.  The  Borrower  and  each  of its  applicable
Subsidiaries  shall insure that all Foreign Pension Plans  administered by it or
into  which it makes  payments  obtains or retains  (as  applicable)  registered
status under and as required by applicable law and is  administered  in a timely
manner in all respects in compliance  with all applicable  laws except where the
failure to do any of the  foregoing  could not,  either  individually  or in the
aggregate, reasonably be expected to have a Material Adverse Effect.

         6.08 End of Fiscal Years; Fiscal Quarters.  The Borrower will cause (i)
each of its,  and each of its  Subsidiaries',  fiscal years to end on the Sunday
following  the last Friday of  September  of each year and (ii) each of its, and
each of its  Subsidiaries',  fiscal quarters to end on the appropriate Sunday at
the end of each fiscal quarter of each year.

         6.09 Performance of Obligations. The Borrower will, and will cause each
of its Subsidiaries  to, perform all of its obligations  under the terms of each
mortgage,  indenture, security agreement, loan agreement or credit agreement and
each other  material  agreement,

                                       23
<PAGE>
contract or instrument  by which it is bound,  except such  non-performances  as
could not, either  individually  or in the aggregate,  reasonably be expected to
have a Material Adverse Effect.

         6.10 Additional Security;  Further Assurances.  (a) In the event of any
material decrease in the value of the collateral securing the Loan, the Borrower
will, and will cause each of the  Subsidiary  Guarantors to, grant to the Lender
security  interests  in such  assets  and  properties  of the  Borrower  and the
Subsidiary Guarantors as are not covered by the original Security Documents, and
as may be reasonably  requested  from time to time by the Lender  (collectively,
the  "Additional  Security  Documents").  All such security  interests  shall be
granted pursuant to documentation  reasonably satisfactory in form and substance
to the Lender and shall  constitute  valid and  enforceable  perfected  security
interests  superior to and prior to the rights of all third  Persons and subject
to no other Liens except for Permitted Liens. The Additional  Security Documents
or  instruments  related  thereto shall have been duly recorded or filed in such
manner and in such places as are required by law to establish, perfect, preserve
and protect the Liens in favor of the Lender required to be granted  pursuant to
the Additional  Security Documents and all taxes, fees and other charges payable
in connection therewith shall have been paid in full.

         (b) The Borrower will, and will cause each of its Subsidiary Guarantors
to, at the expense of the Borrower, make, execute,  endorse,  acknowledge,  file
and/or  deliver  to the  Lender  from  time to  time  such  vouchers,  invoices,
schedules, confirmatory assignments, conveyances, financing statements, transfer
endorsements,  powers of attorney, certificates, real property surveys, reports,
landlord waivers and other assurances or instruments and take such further steps
relating  to the  Collateral  covered by any of the  Security  Documents  as the
Lender  may  reasonably  require.  Furthermore,  the  Borrower  will cause to be
delivered  to the Lender such  opinions of counsel,  title  insurance  and other
related documents as may be reasonably  requested by the Lender to assure itself
that this Section 6.10 has been complied with.

         (c) The Borrower agrees that each action required above by this Section
6.10 shall be completed as soon as possible,  but in no event later than 90 days
after such action is either  requested  to be taken by the Lender or required to
be taken by the Borrower and/or its Subsidiary  Guarantors pursuant to the terms
of this Section 6.10; provided that, in no event will the Borrower or any of its
Subsidiary  Guarantors  be  required  to take any  action,  other than using its
reasonable  best efforts,  to obtain consents from third parties with respect to
its compliance with this Section 6.10.

         (d) As promptly as practicable after the Closing,  but in no event more
than 14 calendar days after the Closing,  the Borrower shall cause each relevant
Assignor  (as  defined  in the  Security  Agreement)  to have  duly  authorized,
executed  and  delivered  the  Control  Agreement  in the form of  Exhibit J (as
amended,  modified or supplemented  from time to time, the "Control  Agreement")
and delivered  the same to the Lender,  with the effect that the Lender shall at
that point have a perfected, first priority Lien on the Bank Account, subject to
no other Liens other than Permitted Liens.

         6.11 Disposition.  The Borrower will use its reasonable best efforts to
consummate the  Disposition on or prior to September 20, 2001 and will cause the
acquirer  of  the  assets  sold  or  otherwise   transferred   pursuant  to  the
Disposition,  to pay, upon the earlier of (x) the

                                       24
<PAGE>
closing of the  Disposition  or (y) the transfer of ownership in the assets sold
or otherwise  transferred to the acquirer pursuant to the Disposition,  directly
to the Lender, that portion of the sale proceeds of the Disposition which equals
the outstanding  principal amount of the Loan (together with outstanding accrued
but unpaid interest thereon) at such time.

         6.12 Use of Proceeds.  The  Borrower  will use the proceeds of the Loan
only as provided in Section 5.08.

         SECTION 7. Negative Covenants. The Borrower hereby covenants and agrees
that on and after the Closing Date and until the Loan and Notes  (together  with
interest  thereon),  and all  other  Obligations  (other  than  any  indemnities
described  in  Section  11.12  which  are not  then  due and  payable)  incurred
hereunder and thereunder, are paid in full:

         7.01  Liens.  The  Borrower  will not,  and will not  permit any of its
Subsidiary Guarantors to, create, incur, assume or suffer to exist any Lien upon
or with  respect  to any  property  or assets  (real or  personal,  tangible  or
intangible)  of the Borrower or any of its  Subsidiary  Guarantors,  whether now
owned or hereafter  acquired,  or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts  receivable with recourse to the Borrower
or any of its Subsidiary  Guarantors),  or assign any right to receive income or
permit the filing of any financing  statement under the UCC or any other similar
notice of Lien under any similar recording or notice statute;  provided that the
provisions  of this  Section  7.01 shall not prevent the  creation,  incurrence,
assumption  or  existence of the  following  (Liens  described  below are herein
referred to as "Permitted Liens"):

         (i) inchoate Liens for taxes,  assessments or  governmental  charges or
    levies not yet due or Liens for taxes,  assessments or governmental  charges
    or levies being  contested in good faith and by appropriate  proceedings for
    which adequate  reserves have been  established in accordance with generally
    accepted accounting principles;

         (ii) Liens in respect of property  or assets of the  Borrower or any of
    its Subsidiaries  imposed by law, which were incurred in the ordinary course
    of business  and do not secure  Indebtedness  for  borrowed  money,  such as
    carriers',  warehousemen's,  materialmen's  and  mechanics'  liens and other
    similar Liens arising in the ordinary  course of business,  and (x) which do
    not in the aggregate  materially detract from the value of the Borrower's or
    such Subsidiary's property or assets or materially impair the use thereof in
    the  operation  of the business of the  Borrower or such  Subsidiary  or (y)
    which are being  contested in good faith by appropriate  proceedings,  which
    proceedings  have the effect of  preventing  the  forfeiture  or sale of the
    property or assets subject to any such Lien;

         (iii) Liens in existence on the Closing Date which are listed,  and the
    property  subject  thereto  described,  in  Schedule  VIII,  but only to the
    respective  date,  if any, set forth in such  Schedule VIII for the removal,
    replacement and termination of any such Liens,  plus renewals,  replacements
    and  extensions of such Liens to the extent set forth on such Schedule VIII,
    provided that (x) the aggregate  principal  amount of the  Indebtedness,  if
    any, secured by such Liens does not increase from that amount outstanding at
    the time

                                       25
<PAGE>
    of any such  renewal,  replacement  or extension  and (y) any such  renewal,
    replacement  or  extension  does  not  encumber  any  additional  assets  or
    properties of the Borrower or any of its Subsidiaries;

         (iv)  Liens  created  pursuant  to  this  Agreement  and  the  Security
    Documents;

         (v) licenses, sublicenses, leases or subleases granted to other Persons
    not materially  interfering with the conduct of the business of the Borrower
    or any of its Subsidiaries;

         (vi)  Liens  upon  assets of the  Borrower  or any of its  Subsidiaries
    subject to  Capitalized  Lease  Obligations  to the extent such  Capitalized
    Lease Obligations are permitted by Section 7.04(iv),  provided that (x) such
    Liens only serve to secure the payment of  Indebtedness  arising  under such
    Capitalized  Lease  Obligation and (y) the Lien encumbering the asset giving
    rise to the Capitalized  Lease  Obligation does not encumber any other asset
    of the Borrower or any Subsidiary of the Borrower;

         (vii) Liens placed upon  equipment,  machinery  or other assets  (other
    than inventory,  receivables and intellectual  property)  acquired after the
    Closing Date and used in the ordinary  course of business of the Borrower or
    any of its  Subsidiaries  at the  time  of the  acquisition  thereof  by the
    Borrower  or any such  Subsidiary  or  within 90 days  thereafter  to secure
    Indebtedness  incurred to pay all or a portion of the purchase price thereof
    or to secure  Indebtedness  incurred solely for the purpose of financing the
    acquisition of any such equipment,  machinery or other assets or extensions,
    renewals or  replacements  of any of the  foregoing for the same or a lesser
    amount,  provided  that  (x)  the  Indebtedness  secured  by such  Liens  is
    permitted by Section  7.04(iv) and (y) in all events,  the Lien  encumbering
    the  equipment,  machinery or other assets so acquired does not encumber any
    other asset of the Borrower or such Subsidiary;

         (viii)  municipal  and  zoning  ordinances,  easements,  rights-of-way,
    restrictions,  encroachments and other similar charges or encumbrances,  and
    minor title  deficiencies,  in each case not securing  Indebtedness  and not
    materially  interfering  with the conduct of the business of the Borrower or
    any of its Subsidiaries;

         (ix) Liens arising from  precautionary UCC financing  statement filings
    regarding operating leases;

         (x)  Liens  arising  out of the  existence  of  judgments  or awards in
    respect of which the Borrower or any of its Subsidiaries shall in good faith
    be prosecuting  an appeal or proceedings  for review and in respect of which
    there shall have been  secured a subsisting  stay of execution  pending such
    appeal or  proceedings,  provided that the aggregate  amount of all cash and
    the fair market value of all other  property  subject to such Liens does not
    exceed $1,000,000 at any time outstanding;

         (xi)  statutory and common law  landlords'  liens under leases to which
    the Borrower or any of its Subsidiaries is a party;

                                       26
<PAGE>
         (xii) Liens  (other than Liens  imposed  under  ERISA)  incurred in the
    ordinary course of business in connection with workers  compensation claims,
    unemployment  insurance and social security  benefits and Liens securing the
    performance of bids, tenders, leases and contracts in the ordinary course of
    business,  statutory obligations,  surety bonds,  performance bonds, customs
    bonds and other  obligations  of a like nature  (other  than  appeal  bonds)
    incurred in the ordinary course of business and  return-of-money  (exclusive
    of obligations in respect of the payment for borrowed money),  provided that
    the  aggregate  amount  of all cash and the fair  market  value of all other
    property  subject to all Liens  permitted  by this clause (xii) shall not at
    any  time  exceed  $1,000,000,  although  no  more  than  $500,000  of  such
    collateral may be in the form of cash at any one time;

         (xiii) Liens in favor of customs and revenue  authorities  which secure
    payment of customs duties in connection with the importation of goods;

         (xiv) Liens  consisting  of rights of set-off of a customary  nature or
    bankers'  liens on amounts  on  deposit,  whether  arising  by  contract  or
    operation of law, incurred in the ordinary course of business;

         (xv) any interest or title of a licensor, lessor or sublessor under any
    license or lease permitted by this Agreement;

         (xvi) Liens on insurance  proceeds securing unpaid premiums incurred in
    connection with the financing of insurance premiums; and

         (xvii)  other Liens  incidental  to the conduct of the  business of the
    Borrower or any of its Subsidiaries that (i) were not incurred in connection
    with  Indebtedness,  (ii) do not  materially  detract  from the value of the
    assets  subject to such Liens or  materially  impair the use  thereof in the
    operation  of such  business  (although  to the  extent  that any such Liens
    attach to any Collateral, such Liens shall be junior to the Liens created in
    favor of the Lender and (iii) do not encumber cash and other property with a
    value in excess of, and do not secure  obligations in excess of,  $3,000,000
    in the aggregate for all such Liens at any time outstanding.

         7.02  Consolidation,  Merger,  Purchase  or Sale of  Assets,  etc.  The
Borrower will not, and will not permit any of its Subsidiary Guarantors to, wind
up, liquidate or dissolve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of all or any part of
its  property  or assets,  or enter  into any  sale-leaseback  transactions,  or
purchase or otherwise  acquire (in one or a series of related  transactions) any
part of the property or assets (other than  purchases or other  acquisitions  of
inventory,  materials and  equipment in the ordinary  course of business) of any
Person (or agree to do any of the foregoing at any future time), except that:

         (i) Capital  Expenditures by the Borrower and its Subsidiaries shall be
    permitted;

         (ii)  each of the  Borrower  and its  Subsidiaries  may  make  sales of
    inventory in the ordinary course of business;

                                       27
<PAGE>
         (iii) each of the  Borrower  and its  Subsidiaries  may sell  obsolete,
    uneconomic or worn-out  equipment or  intellectual  property in the ordinary
    course of business;

         (iv) each of the  Borrower and its  Subsidiaries  may sell other assets
    (other than the capital stock of any Subsidiary  Guarantor),  so long as (v)
    no Default or Event of Default  then exists or would result  therefrom,  (w)
    each such sale is in an  arm's-length  transaction  and the  Borrower or the
    respective  Subsidiary receives at least fair market value (as determined in
    good faith by the Borrower or such Subsidiary,  as the case may be), (x) the
    total consideration  received by the Borrower or such Subsidiary is at least
    90% cash and is paid at the time of the  closing of such  sale,  (y) the Net
    Sale  Proceeds  therefrom  are  applied as (and to the  extent)  required by
    Section 3.02(c) and (z) the aggregate  amount of the proceeds  received from
    all assets sold pursuant to this clause (iv) shall not exceed  $5,000,000 in
    any fiscal year of the Borrower;

         (v) Investments may be made to the extent permitted by Section 7.05;

         (vi) each of the Borrower and its Subsidiaries may lease (as lessee) or
    license (as licensee)  real or personal  property (so long as any such lease
    or license does not create a Capitalized Lease Obligation of the Borrower or
    any of its Subsidiary  Guarantors  except to the extent permitted by Section
    7.04(iv));

         (vii) each of the Borrower and its  Subsidiaries  may sell or discount,
    in each case  without  recourse  and in the  ordinary  course  of  business,
    accounts receivable arising in the ordinary course of business,  but only in
    connection with the compromise or collection  thereof and not as part of any
    financing transaction;

         (viii) the Disposition shall be permitted;

         (ix) each of the  Borrower  and its  Subsidiaries  may grant  licenses,
    sublicenses, leases or subleases to other Persons not materially interfering
    with the conduct of the business of the Borrower or any of its Subsidiaries,
    in  each  case  so long as no such  grant  otherwise  affects  the  Lender's
    security  interest in the asset or property  subject  thereto (to the extent
    that a security interest is granted thereunder in such property);

         (x) any  Subsidiary  of the Borrower (i) may be merged or  consolidated
    with or into the  Borrower  or  liquidated  so long as the  Borrower  is the
    surviving  corporation of such merger or  consolidation or the Borrower or a
    Subsidiary  Guarantor  thereof  receives the assets of such  Subsidiary upon
    such liquidation and (ii) may transfer its assets to the Borrower;

         (xi) any  Subsidiary of the Borrower (i) may be merged or  consolidated
    with or into any other  Subsidiary  of the Borrower or liquidated so long as
    (A) in the  case  of any  (x)  such  merger  or  consolidation  involving  a
    Subsidiary Guarantor, a Subsidiary Guarantor is the surviving corporation of
    such  merger  or  consolidation  or (y)  such  liquidation  of a  Subsidiary
    Guarantor,  a Subsidiary  Guarantor  receives the assets of such  Subsidiary
    upon  such  liquidation  and  (B) in the  case  of any (x)  such  merger  or
    consoli-

                                       28
<PAGE>
    dation involving a Wholly-Owned  Subsidiary of the Borrower,  in addition to
    the requirements of preceding  clause (A)(x),  a Wholly-Owned  Subsidiary is
    the  surviving  corporation  of such  merger  or  consolidation  or (y) such
    liquidation,  in addition to the  requirements of preceding clause (B)(y), a
    Wholly-Owned  Subsidiary  receives the assets of such  Subsidiary  upon such
    liquidation and (ii) may transfer its assets to any other  Subsidiary of the
    Borrower,  provided  that  if  the  transferor  Subsidiary  is a  Subsidiary
    Guarantor, then such transfer must be to another Subsidiary Guarantor;

         (xii) the Borrower may sell or otherwise  transfer  inventory to one or
    more of the Subsidiary  Guarantors for resale by such Subsidiary  Guarantors
    at fair market value;

         (xiii) the  Borrower may sell or otherwise  transfer  equipment,  other
    fixed assets and intellectual property in the ordinary course of business to
    one or more of the Subsidiary Guarantors;

         (xiv) the Borrower and its  Subsidiaries  may sell Cash Equivalents for
    cash and at a purchase price no less than the principal  amount thereof plus
    any accrued and unpaid interest thereon; and

         (xv) expenditures not to exceed $1,000,000 for repurchases of shares of
    UTC Common Stock on the NASDAQ-NMS are permitted.

To the extent the Lender waives the provisions of this Section 7.02 with respect
to the sale of any  Collateral,  or any  Collateral is sold as permitted by this
Section  7.02  (other  than  to the  Borrower  or a  Subsidiary  thereof),  such
Collateral  shall be sold free and clear of the Liens  created  by the  Security
Documents.

         7.03  Dividends.  The Borrower will not, and will not permit any of its
Subsidiaries  to,  authorize,  declare or pay any Dividends  with respect to the
Borrower or any of its Subsidiaries, except that:

         (i) any  Subsidiary  of the  Borrower  may pay  cash  Dividends  to the
    Borrower or to any Guarantor Subsidiary of the Borrower;

         (ii)  any  non-Wholly-Owned  Subsidiary  of the  Borrower  may pay cash
    Dividends  to its  shareholders  generally  so long as the  Borrower  or its
    respective  Subsidiary  which owns the  equity  interest  in the  Subsidiary
    paying such  Dividends  receives at least its  proportionate  share  thereof
    (based upon its relative  holding of the equity  interest in the  Subsidiary
    paying such Dividends and taking into account the relative  preferences,  if
    any, of the various classes of equity interests of such Subsidiary); and

         (iii) so long as there shall exist no Default or Event of Default (both
    before and after  giving  effect to the payment  thereof),  the Borrower may
    repurchase  outstanding  shares of its common  stock (or options to purchase
    such  common  stock) or  Qualified  Preferred  Stock  following  the  death,
    disability or termination of employment of officers,  directors or employees
    of the  Borrower  or any of its  Subsidiaries,  provided  that  (x) the only
    consideration  paid by the  Borrower in respect of such  purchases  shall be
    cash,

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<PAGE>
    Shareholder  Subordinated Notes and/or cancellation of Indebtedness owing to
    the Borrower from such employees and (y) the sum of (I) the aggregate amount
    paid by the Borrower in cash in respect of all such  purchases plus (II) the
    aggregate amount of all principal,  interest and other cash payments made on
    all Shareholder Subordinated Notes shall not exceed $500,000.

         7.04  Indebtedness.  The Borrower  will not, and will not permit any of
its Subsidiary Guarantors to, contract, create, incur, assume or suffer to exist
any Indebtedness, except:

         (i)  Indebtedness  incurred  pursuant to this  Agreement  and the other
    Credit Documents;

         (ii) Existing  Indebtedness  outstanding on the Closing Date and listed
    on Schedule VI, without giving effect to any subsequent  extension,  renewal
    or  refinancing  thereof  except to the  extent  set forth on  Schedule  VI,
    provided  that the  aggregate  principal  amount of the  Indebtedness  to be
    extended,   renewed  or  refinanced  does  not  increase  from  that  amount
    outstanding at the time of any such extension, renewal or refinancing;

         (iii)  Indebtedness  under Interest Rate Protection  Agreements entered
    into with respect to other Indebtedness permitted under this Section 7.04 so
    long as the entering into of such Interest Rate  Protection  Agreements  are
    bona fide hedging activities and are not for speculative purposes;

         (iv)  Indebtedness  of the Borrower and its  Subsidiaries  evidenced by
    Capitalized Lease Obligations and purchase money  Indebtedness  described in
    Section 7.01(vii),  provided that in no event shall the sum of the aggregate
    principal  amount of all  Capitalized  Lease  Obligations and purchase money
    Indebtedness  permitted by this clause (iv) exceed  $25,000,000  at any time
    outstanding;

         (v) Indebtedness  consisting of vendor financing provided by the Lender
    to the Borrower  pursuant to, and in accordance  with the terms of, the Sale
    Documents;

         (vi) intercompany  Indebtedness among the Borrower and its Subsidiaries
    to the extent permitted by Section 7.05(ix);

         (vii)  Indebtedness  consisting  of  guaranties by the Borrower and its
    Subsidiaries   of  each  other's   Indebtedness   (other  than   Shareholder
    Subordinated  Notes) and lease and other  obligations  permitted  under this
    Agreement,  provided that to the extent that any  Subsidiary of the Borrower
    which is not then a Subsidiary  Guarantor  guaranties  any obligation of the
    Borrower or any Subsidiary Guarantor,  such Subsidiary shall become a Credit
    Party hereunder by taking all actions necessary as if such Subsidiary were a
    newly created or acquired Wholly-Owned Domestic Subsidiary;

         (viii) Indebtedness in respect of bid,  performance,  customs,  appeal,
    surety and similar bonds entered into in the ordinary  course of business in
    an aggregate amount not to exceed $500,000 at any time outstanding;

                                       30
<PAGE>
         (ix)  Indebtedness  arising  from  the  honoring  by a  bank  or  other
    financial  institution of a check, draft or similar instrument drawn against
    insufficient  funds  in the  ordinary  course  of  business  so long as such
    Indebtedness  is  extinguished  within three Business Days of the incurrence
    thereof;

         (x)  Indebtedness in respect of guarantees of royalty  payments entered
    into in the ordinary course;

         (xi) Indebtedness under Other Hedging Agreements  providing  protection
    against fluctuations in currency values in connection with the Borrower's or
    any of its Subsidiaries' operations so long as management of the Borrower or
    such  Subsidiary,  as the case may be, has determined that the entering into
    of such Other Hedging  Agreements  are bona fide hedging  activities and are
    not for speculative purposes;

         (xii)   Indebtedness  in  respect  of  unpaid  insurance   premiums  in
    connection with the financing of insurance premiums;

         (xiii)  Indebtedness in respect of any convertible  debentures  offered
    pursuant to a Rule 144A offering under the Securities Act of 1933,  provided
    that any proceeds  thereof are applied in accordance  with Section  3.02(a);
    and

         (xiv) so long as no Default or Event of  Default  then  exists or would
    result from the incurrence thereof, additional unsecured Indebtedness of the
    Borrower  and its  Subsidiaries  not  otherwise  permitted  hereunder  in an
    aggregate principal amount not to exceed $1,000,000 at any time outstanding.

         7.05  Advances,  Investments  and Loan. The Borrower will not, and will
not permit any of its  Subsidiaries  to,  directly or indirectly,  lend money or
credit or make  advances  to any  Person,  or  purchase  or  acquire  any stock,
obligations  or  securities  of, or any other  interest  in, or make any capital
contribution  to, any other  Person,  or purchase  or own a futures  contract or
otherwise  become  liable  for  the  purchase  or  sale  of  currency  or  other
commodities  at a future date in the nature of a futures  contract,  or hold any
cash  or  Cash  Equivalents   (each  of  the  foregoing  an  "Investment"   and,
collectively, "Investments"), except that the following shall be permitted:

         (i) the Borrower  and its  Subsidiaries  may acquire and hold  accounts
    receivables  owing to any of them,  if created or acquired  in the  ordinary
    course of business and payable or dischargeable in accordance with customary
    trade terms of the Borrower or such Subsidiary;

         (ii) the  Borrower and its  Subsidiaries  may acquire and hold cash and
    Cash Equivalents;

         (iii) the Borrower and its  Subsidiaries  may hold the Investments held
    by them on the Closing Date and described on Schedule IX,  provided that any
    additional  Investments made with respect thereto shall be permitted only if
    independently justified under the other provisions of this Section 7.05;

                                       31
<PAGE>
         (iv) the Borrower and its  Subsidiaries may acquire and own investments
    (including debt  obligations)  received in connection with the bankruptcy or
    reorganization  of suppliers and  customers and in good faith  settlement of
    delinquent  obligations of, and other disputes with, customers and suppliers
    arising in the ordinary course of business;

         (v) the  Borrower and its  Subsidiaries  may make loans and advances in
    the ordinary course of business to their respective employees so long as the
    aggregate  principal  amount  thereof  at any time  outstanding  (determined
    without regard to any  write-downs or write-offs of such loans and advances)
    shall not exceed $250,000;

         (vi) the  Borrower  may  acquire  and hold  obligations  of one or more
    officers or other  employees of the Borrower or any of its  Subsidiaries  in
    connection with such officers' or employees' acquisition of shares of common
    stock or Qualified Preferred Stock or options with respect to any such stock
    of the  Borrower  so long as no cash is paid by the  Borrower  or any of its
    Subsidiaries   to  such  officers  or  employees  in  connection   with  the
    acquisition of any such obligations;

         (vii) the Borrower may enter into Interest Rate  Protection  Agreements
    to the  extent  permitted  by Section  7.04(iii)  and the  Borrower  and its
    Subsidiaries may enter into Other Hedging Agreements to the extent permitted
    by Section 7.04(xi);

         (viii)  the  Borrower  and  its   Subsidiaries  may  acquire  and  hold
    promissory notes and other non-cash consideration issued by the purchaser of
    assets in connection  with a sale of such assets to the extent  permitted by
    Section 7.02(iv);

         (ix)  (A)  the  Borrower  and  the   Subsidiary   Guarantors  may  make
    intercompany loans and advances between or among one another  (collectively,
    "Intercompany  Loans"),  and (B) the Borrower and the Subsidiary  Guarantors
    may make cash equity  contributions in their respective  Subsidiaries  which
    are Subsidiary Guarantors;

         (x) the Borrower and its Subsidiaries  may hold additional  investments
    in their respective Subsidiaries to the extent that such investments reflect
    an increase in the value of such Subsidiaries;

         (xi) the Borrower and its  Subsidiaries may make transfers of assets in
    accordance  with, and to the extent  permitted by, Sections  7.02(x),  (xi),
    (xii) and (xiii);

         (xii) the Borrower and the  Subsidiary  Guarantors  may  capitalize  or
    forgive Indebtedness owed to one another;

         (xiii) the Borrower and its  Subsidiaries  may make advances in respect
    of license royalty  payments,  payments to suppliers in respect of purchases
    of inventory  and other advance  payments as part of the  Borrower's or such
    Subsidiary's  operations  (other than to any  director,  officer or employee
    thereof),  in each case in the  ordinary  course of business  and on a basis
    consistent with past practices;

                                       32
<PAGE>
         (xiv) so long as no Default or Event of  Default  then  exists or would
    result therefrom, the Borrower and its Subsidiaries may make Investments not
    otherwise permitted by clauses (i) through (xiii) of this Section 7.05 in an
    aggregate  amount not to exceed $250,000  (determined  without regard to any
    write-downs or write-offs thereof), net of cash payments of principal in the
    case of loans and cash equity returns  (whether as a dividend or redemption)
    in the case of equity investments); and

         (xv) the Borrower may consummate the Sale.

         7.06 Transactions with Affiliates.  The Borrower will not, and will not
permit  any of its  Subsidiaries  to,  enter into any  transaction  or series of
related  transactions,  whether or not in the ordinary course of business,  with
any  Affiliate  of the  Borrower or any of its  Subsidiaries,  other than in the
ordinary  course  of  business  and on terms  and  conditions  substantially  as
favorable to the Borrower or such Subsidiary as would  reasonably be obtained by
the  Borrower  or such  Subsidiary  at that  time in a  comparable  arm's-length
transaction with a Person other than an Affiliate,  except that the following in
any event shall be permitted:

         (i) Dividends may be paid to the extent provided in Section 7.03;

         (ii) loans may be made and other  transactions  may be entered  into by
    the Borrower and its  Subsidiaries to the extent permitted by Sections 7.02,
    7.04 and 7.05;

         (iii)  customary  fees  may be paid  to  non-officer  directors  of the
    Borrower and its  Subsidiaries  and expenses  and  indemnifications  for all
    directors of the Borrower;

         (iv)  the  transactions  set  forth  on  Schedule  XI  pursuant  to the
    arrangements with respect thereto as in effect on the Closing Date;

         (v) the Borrower may issue and sell shares of its capital  stock to the
    extent not otherwise prohibited under this Agreement; and

         (vi) the Borrower  and its  Subsidiaries  may enter into,  and may make
    payments under, employment agreements, employee benefits plans, stock option
    plans,   indemnification   provisions   and   other   similar   compensatory
    arrangements with officers,  employees and directors of the Borrower and its
    Subsidiaries in the ordinary course of business.

         7.07  Limitation  on Voluntary  Payments and  Modifications  of Certain
Indebtedness; Modifications of Certificate of Incorporation, By-Laws and Certain
Other  Agreements,  etc. The  Borrower  will not, and will not permit any of its
Subsidiary Guarantors to:

         (i) make (or give any notice in respect of) any  voluntary  or optional
    payment or prepayment on or redemption or  acquisition  for value of, or any
    prepayment or redemption as a result of any asset sale, change of control or
    similar  event of  (including in each case,  without  limitation,  by way of
    depositing  with the trustee with respect  thereto or any other Person money
    or securities  before due for the purpose of paying when due), any Permitted
    Indebtedness;

                                       33
<PAGE>
         (ii) make (or give any notice in respect of), any payment,  prepayment,
    redemption or acquisition for value of (including,  without  limitation,  by
    way of  depositing  with any Person money or  securities  before due for the
    purpose of paying when due) any Shareholder  Subordinated  Notes (whether in
    respect of principal,  interest or  otherwise),  provided that so long as no
    Default or Event of  Default  then  exists or would  result  therefrom,  the
    Borrower may make payments on Shareholder  Subordinated  Notes to the extent
    permitted by Section 7.03(iii);

         (iii) amend or modify,  or permit the amendment or modification of, any
    provision of any Shareholder  Subordinated  Note (including as a result of a
    refinancing or replacement thereof);

         (iv)  amend,   modify  or  change  its   certificate   or  articles  of
    incorporation (including,  without limitation, by the filing or modification
    of any certificate or articles of designation) or by-laws (or the equivalent
    organizational  documents) or any agreement  entered into by it with respect
    to its capital stock (including any Shareholders'  Agreement), or enter into
    any new agreement with respect to its capital stock,  unless such amendment,
    modification, change or other action contemplated by this clause (vii) could
    not  reasonably  be expected to be adverse to the interests of the Lender in
    any material respect; or

         (v)  amend,  modify  or  change  any  provision  of (x) any  Management
    Agreement,   unless  such  amendment,   modification  or  change  could  not
    reasonably  be  expected  to be  adverse  to the  interests  of  the  Lender
    (although no amendment or change may be made to any monetary  term  thereof)
    or (y) any  Tax  Sharing  Agreement  or  enter  into  any  new  tax  sharing
    agreement,  tax allocation  agreement or similar agreement without the prior
    written consent of the Lender.

         7.08  Limitation on Certain  Restrictions on  Subsidiaries.  Subject to
Section 7.12, the Borrower will not, and will not permit any of its Subsidiaries
to,  directly or  indirectly,  create or  otherwise  cause or suffer to exist or
become  effective  any  encumbrance  or  restriction  on the ability of any such
Subsidiary to (a) pay dividends or make any other  distributions  on its capital
stock  or any  other  interest  or  participation  in its  profits  owned by the
Borrower or any Subsidiary of the Borrower,  or pay any Indebtedness owed to the
Borrower or any  Subsidiary of the  Borrower,  (b) make loans or advances to the
Borrower or any Subsidiary of the Borrower or (c) transfer any of its properties
or assets to the Borrower or any  Subsidiary  of the  Borrower,  except for such
encumbrances or restrictions  existing under or by reason of (i) applicable law,
(ii) this Agreement and the other Credit Documents,  (iii) customary  provisions
restricting subletting or assignment of any lease governing a leasehold interest
of the Borrower or any  Subsidiary of the Borrower,  (iv)  customary  provisions
restricting assignment of any licensing agreement (in which the Borrower or such
Subsidiary  is the licensee) or other  contract  entered into by the Borrower or
any  Subsidiary  of the  Borrower  in  the  ordinary  course  of  business,  (v)
restrictions  on the transfer of any asset pending the close of the sale of such
asset,  (vi)  restrictions  on the  transfer  of  any  asset  subject  to a Lien
permitted  by Section  7.01 and (vii)  customary  restrictions  set forth in any
joint venture agreement  permitted hereunder on the transfer of any asset of the
joint venture subject thereto.

                                       34
<PAGE>
         7.09  Limitation  on Issuance of Capital  Stock.  (a) The Borrower will
not, and will not permit any of its  Subsidiaries to, issue (i) any common stock
other than common stock issued  pursuant to the Sale Documents and in accordance
with Section  1.05(b)  hereof,  (ii) any  preferred  stock other than  Qualified
Preferred Stock of the Borrower or (iii) any redeemable  common stock other than
common  stock that is  redeemable  at the sole  option of the  Borrower  or such
Subsidiary, as the case may be.

         (b) The Borrower will not permit any of its  Subsidiaries  to issue any
capital stock  (including  by way of sales of treasury  stock) or any options or
warrants to purchase, or securities  convertible into, capital stock, except (i)
for transfers and replacements of then outstanding shares of capital stock, (ii)
for stock  splits,  stock  dividends  and  issuances  which do not  decrease the
percentage  ownership of the Borrower or any of its Subsidiaries in any class of
the capital stock of such Subsidiary,  (iii) to qualify  directors to the extent
required by  applicable  law,  (iv) for  issuances by newly  created or acquired
Subsidiaries  in  accordance  with  the  terms of this  Agreement  or (v) to the
Borrower or a Subsidiary  Guarantor  that is a  Wholly-Owned  Subsidiary  of the
Borrower.

         7.10  Business.  The Borrower  will not, and will not permit any of its
Subsidiaries to, engage in any business other than the businesses  engaged in by
the  Borrower  and  its  Subsidiaries  as of the  Closing  Date  and  reasonable
extensions thereof and activities incidental thereof.

         7.11 Limitation on Creation of Subsidiaries. The Borrower will not, and
will not  permit  any of its  Subsidiary  Guarantors  to,  establish,  create or
acquire  after the Closing Date any  Subsidiary,  provided that the Borrower and
its Wholly-Owned  Subsidiaries that are Subsidiary Guarantors shall be permitted
to (A)  establish,  create and, to the extent  permitted  by Section  7.05(xiv),
acquire  Wholly-Owned  Subsidiaries  so long as (i) each  such new  Wholly-Owned
Domestic Subsidiary executes a counterpart of the Subsidiaries  Guaranty and the
Security Agreement, and (ii) each such new Wholly-Owned Domestic Subsidiary,  to
the extent  requested  by the  Lender,  takes all actions  required  pursuant to
Section 6.10 and (B) establish, create and acquire non-Wholly-Owned Subsidiaries
in each case to the extent  permitted by Section  7.05(xiv).  In addition,  each
such new  Wholly-Owned  Subsidiary  shall  execute and  deliver,  or cause to be
executed and delivered,  all other relevant  documentation of the type described
in Section 4 as such new  Wholly-Owned  Subsidiary  would have had to deliver if
such new Wholly-Owned Subsidiary were a Credit Party on the Closing Date.

         7.12 Bank Accounts;  Transfers.  The Borrower shall not permit Uniroyal
Optoelectronics,  LLC  ("UOE") to create,  maintain  or have  access to any bank
account,  deposit  account or other similar account other than the Bank Account.
The Borrower  shall  ensure that all cash  received by UOE shall be deposited in
the Bank  Account.  Unless an Event of Default has  occurred  and is  continuing
(whereupon,  upon such Event of  Default,  no funds may be  withdrawn  by UOE or
other Person,  subject to  applicable  laws,  from the Bank Account  without the
prior written  consent or  instructions  of the Lender),  funds may be withdrawn
from the Bank Account by UOE  exclusively  for the purpose of making payments to
current  account  debtors in the  ordinary  course of business  and for payroll,
payroll taxes and other employee wage and benefit payments to or for the benefit
of UOE's  salaried  employees and otherwise in accordance  with the

                                       35
<PAGE>
terms of the Credit Documents.  Without limiting the foregoing, UOE shall not be
permitted to make any  transfers  out of the Bank Account to the Borrower or any
other Subsidiary of the Borrower.

         SECTION  8.  Events  of  Default.  Upon  the  occurrence  of any of the
following specified events (each an "Event of Default"):

         8.01  Payments.  The Borrower shall (i) default in the payment when due
of any principal or interest of the Loan or any Note or (ii)  default,  and such
default  shall  continue  unremedied  for three or more  Business  Days,  in the
payment when due of any other amounts owing hereunder or thereunder; or

         8.02  Representations,  etc. Any representation,  warranty or statement
made or deemed made by any Credit Party  herein or in any other Credit  Document
or in any  certificate  delivered to the Lender pursuant hereto or thereto shall
prove to be  untrue  in any  material  respect  on the date as of which  made or
deemed made; or

         8.03 Covenants.  The Borrower or any of its Subsidiary Guarantors shall
(i) default in the due performance or observance by it of any term,  covenant or
agreement  contained  in  Section  6.01(g)(i),  6.09,  6.12 or Section 7 or (ii)
default in the due  performance or observance by it of any other term,  covenant
or agreement  contained in this  Agreement or any other Credit  Document  (other
than those set forth in Sections 8.01 and 8.02) and such default shall  continue
unremedied  for a  period  of 30  days  after  written  notice  thereof  to  the
defaulting party by the Lender; or

         8.04  Default  Under Other  Agreements.  (i) The Borrower or any of its
Subsidiary  Guarantors  shall (x)  default in any  payment  of any  Indebtedness
(other than the Obligations) beyond the period of grace, if any, provided in the
instrument or agreement under which such Indebtedness was created or (y) default
in the observance or  performance of any agreement or condition  relating to any
Indebtedness  (other than the  Obligations)  or contained in any  instrument  or
agreement evidencing,  securing, guaranteeing, or relating thereto, or any other
event shall occur or condition exist, the effect of which default or other event
or  condition  is to  cause,  or  to  permit  the  holder  or  holders  of  such
Indebtedness  (or a trustee  or agent on behalf of such  holder or  holders)  to
cause  (determined  without regard to whether any notice is required),  any such
Indebtedness  to become due prior to its stated  maturity  or (z) default in the
observance or performance  of any term or condition  under the Sale Documents or
the Disposition Documents, or (ii) any Indebtedness (other than the Obligations)
of the  Borrower  or any of its  Subsidiaries  shall be declared to be (or shall
become) due and  payable,  or  required to be prepaid  other than by a regularly
scheduled required  prepayment,  prior to the stated maturity thereof,  provided
that it shall not be a Default or an Event of Default  under this  Section  8.04
unless the  aggregate  principal  amount of all  Indebtedness  as  described  in
preceding clauses (i) and (ii) is at least $500,000; or

         8.05  Bankruptcy,  etc. The Borrower or any of its  Subsidiaries  shall
commence a voluntary case concerning  itself under Title 11 of the United States
Code  entitled  "Bankruptcy,"  as now or hereafter in effect,  or any  successor
thereto (the "Bankruptcy Code"); or an involuntary

                                       36
<PAGE>
case is  commenced  against  the  Borrower or any of its  Subsidiaries,  and the
petition is not controverted within 10 days, or is not dismissed within 60 days,
after  commencement  of the case; or a custodian  (as defined in the  Bankruptcy
Code) is  appointed  for, or takes  charge of, all or  substantially  all of the
property of the Borrower or any of its  Subsidiaries,  or the Borrower or any of
its  Subsidiaries  commences  any other  proceeding  under  any  reorganization,
arrangement,  adjustment of debt, relief of debtors, dissolution,  insolvency or
liquidation  or similar  law of any  jurisdiction  whether now or  hereafter  in
effect  relating  to  the  Borrower  or any of its  Subsidiaries,  or  there  is
commenced  against the Borrower or any of its  Subsidiaries  any such proceeding
which remains undismissed for a period of 60 days, or the Borrower or any of its
Subsidiaries  is  adjudicated  insolvent or bankrupt;  or any order of relief or
other order approving any such case or proceeding is entered; or the Borrower or
any of its Subsidiaries suffers any appointment of any custodian or the like for
it or any substantial part of its property to continue  undischarged or unstayed
for a period of 60 days;  or the  Borrower  or any of its  Subsidiaries  makes a
general  assignment for the benefit of creditors;  or the Borrower or any of its
Subsidiaries shall be generally not paying its debts as such debts become due or
shall  admit  in  writing  its  inability  to pay its  debts  generally;  or any
corporate  action is taken by the  Borrower or any of its  Subsidiaries  for the
purpose of effecting any of the foregoing; or

         8.06  ERISA.  (a) Any Plan shall fail to satisfy  the  minimum  funding
standard  required  for any plan year or part thereof  under  Section 412 of the
Code or Section 302 of ERISA or a waiver of such  standard or  extension  of any
amortization  period is  sought  or  granted  under  Section  412 of the Code or
Section  303 or 304  of  ERISA,  a  Reportable  Event  shall  have  occurred,  a
contributing  sponsor  (as  defined in Section  4001(a)(13)  of ERISA) of a Plan
subject  to  Title  IV of  ERISA  shall  be  subject  to the  advance  reporting
requirement of PBGC Regulation  Section 4043.61  (without regard to subparagraph
(b)(1)  thereof) and an event  described in subsection  .62, .63, .64, .65, .66,
 .67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
with  respect  to such Plan  within  the  following  30 days,  any Plan which is
subject  to Title IV of ERISA  shall  have had or is  likely  to have a  trustee
appointed  to  administer  such  Plan,  any Plan which is subject to Title IV of
ERISA is, shall have been or is likely to be  terminated or to be the subject of
termination  proceedings  under ERISA,  any Plan shall have an Unfunded  Current
Liability,  a  contribution  required  to be made  with  respect  to a Plan or a
Foreign Pension Plan has not been timely made, the Borrower or any Subsidiary of
the  Borrower  or any ERISA  Affiliate  has  incurred  or is likely to incur any
liability to or on account of a Plan under  Section 409,  502(i),  502(l),  515,
4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29),  4971
or 4975 of the Code or on account of a group  health plan (as defined in Section
607(1) of ERISA or Section  4980B(g)(2)  of the Code) under Section 4980B of the
Code,  or the  Borrower or any  Subsidiary  of the  Borrower  has incurred or is
likely to incur  liabilities  pursuant to one or more employee  welfare  benefit
plans (as  defined in Section  3(1) of ERISA) that  provide  benefits to retired
employees  or other former  employees  (other than as required by Section 601 of
ERISA) or Plans or Foreign  Pension  Plans,  a  "default"  within the meaning of
Section 4219(c)(5) of ERISA shall occur with respect to any Plan, any applicable
law,   rule  or  regulation  is  adopted,   changed  or   interpreted,   or  the
interpretation or administration thereof is changed, in each case after the date
hereof,  by any  governmental  authority or agency or by any court (a "Change of
Law"), or, as a result of a Change in Law, an event occurs following a Change in
Law,  with respect to or otherwise  affecting  any Plan;  (b) there shall result
from any

                                       37
<PAGE>
such  event or events  the  imposition  of a lien,  the  granting  of a security
interest,  or a liability or a material  risk of incurring a liability;  and (c)
such lien, security interest or liability, individually and/or in the aggregate,
has had, or could reasonably be expected to have, a Material Adverse Effect; or

         8.07 Security  Documents.  Any of the Security Documents shall cease to
be in full force and effect (other than in accordance  with the terms  thereof),
or shall  cease to give the  Lender  the Liens,  rights,  powers and  privileges
purported  to be created  thereby or any Credit  Party shall  default in the due
performance  or observance of any term,  covenant or agreement on its part to be
performed or observed  pursuant to any such  Security  Document and such default
shall  continue  beyond the  period of grace,  if any,  specifically  applicable
thereto pursuant to the terms of such Security Document; or

         8.08 Subsidiaries  Guaranty. The Subsidiaries Guaranty or any provision
thereof shall cease to be in full force or effect (other than in accordance with
the express terms  thereof) as to any  Subsidiary  Guarantor,  or any Subsidiary
Guarantor  or any  Person  acting by or on behalf of such  Subsidiary  Guarantor
shall  deny or  disaffirm  such  Subsidiary  Guarantor's  obligations  under the
Subsidiaries  Guaranty  or any  Subsidiary  Guarantor  shall  default in the due
performance  or observance of any term,  covenant or agreement on its part to be
performed or observed pursuant to the Subsidiaries Guaranty; or

         8.09  Judgments.  One or more  judgments  or  decrees  shall be entered
against  the  Borrower  or any  Subsidiary  of  the  Borrower  involving  in the
aggregate for the Borrower and its  Subsidiaries  a liability (not paid or fully
covered by a reputable  and solvent  insurance  company) and such  judgments and
decrees either shall be final and  non-appealable  and remains unpaid for 7 days
after the entry thereof or shall not be vacated,  discharged or stayed or bonded
pending appeal within 60 days of entry thereof,  and the aggregate amount of all
such judgments equals or exceeds $500,000; or

         8.10   Change  of   Control.   A  Change  of   Control   shall   occur;

then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Lender may by written notice to the Borrower, take
any or all of the  following  actions,  without  prejudice  to the rights of the
Lender  (provided  that, if an Event of Default  specified in Section 8.05 shall
occur with respect to the Borrower, the result which would occur upon the giving
of written notice by the Lender as specified in clauses (i) and (ii) below shall
occur  automatically  without  the giving of any such  notice):  (i) declare the
Commitment  terminated,  whereupon the Commitment of the Lender shall  forthwith
terminate immediately; (ii) declare the principal of and any accrued interest in
respect  of the  Loan  and the  Note and all  Obligations  owing  hereunder  and
thereunder to be,  whereupon  the same shall  become,  forthwith due and payable
without presentment,  demand,  protest or other notice of any kind, all of which
are hereby  waived by each  Credit  Party;  and (iii)  enforce any or all of the
Liens and  security  interests  created  pursuant to the  Security  Documents in
accordance with the terms thereof.

                                       38
<PAGE>
         SECTION 9. Definitions and Accounting Terms.

         9.01 Defined  Terms.  As used in this  Agreement,  the following  terms
shall have the following  meanings  (such  meanings to be equally  applicable to
both the singular and plural forms of the terms defined):

         "Additional  Interest Trigger Date" shall mean the earlier of September
20, 2001 and the consummation of the Disposition.

         "Additional  Security  Documents"  shall have the  meaning  provided in
Section 6.10.

         "Adhesives  Division" shall mean the adhesives and sealants business of
Uniroyal Engineered Products L.L.C., a Delaware limited liability company.

         "Affiliate"  shall mean,  with respect to any Person,  any other Person
directly or indirectly controlling (including, but not limited to, all directors
and officers of such Person),  controlled by, or under direct or indirect common
control with, such Person. A Person shall be deemed to control another Person if
such Person possesses,  directly or indirectly, the power (i) to vote 5% or more
of the securities  having ordinary voting power for the election of directors of
such  corporation or (ii) 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;  provided,  however, that the Lender (nor
any Affiliate  thereof)  shall not be considered an Affiliate of the Borrower or
any Subsidiary thereof.

         "Agreement"   shall   mean  this   Credit   Agreement,   as   modified,
supplemented,   amended,  restated  (including  any  amendment  and  restatement
hereof), extended or renewed from time to time.

         "Asset Sale" shall mean any sale,  transfer or other disposition by the
Borrower  or  any  of  its  Subsidiaries  to  any  Person  (including  by way of
redemption  by  such  Person)  other  than  to the  Borrower  or a  Wholly-Owned
Subsidiary  of the Borrower of any asset  (including,  without  limitation,  any
capital stock or other  securities of, or equity  interests in, another  Person)
other than sales of assets pursuant to Sections  7.02(ii),  (iii),  (vii), (ix),
(x), (xi), (xii), (xiii) and (xiv).

         "Bank Account" shall mean that certain  deposit  account known as Acct#
DDA#2090002593219 maintained with First Union National Bank.

         "Bankruptcy Code" shall have the meaning provided in Section 8.05.

         "Borrower"  shall have the meaning  provided in the first  paragraph of
this Agreement.

         "Borrowing" shall mean the borrowing of the Loan from the Lender on the
Closing Date.

                                       39
<PAGE>
         "Business  Day" shall mean for all  purposes  any day except  Saturday,
Sunday and any day which shall be in New York, New York a legal holiday or a day
on  which  banking  institutions  are  authorized  or  required  by law or other
government action to close.

         "Capital  Expenditures"  shall mean,  with  respect to any Person,  all
expenditures  by such Person  which should be  capitalized  in  accordance  with
generally accepted accounting principles and, without duplication, the amount of
Capitalized Lease Obligations incurred by such Person.

         "Capitalized Lease Obligations" shall mean, with respect to any Person,
all rental obligations of such Person which, under generally accepted accounting
principles,  are or will be  required  to be  capitalized  on the  books of such
Person,  in each case taken at the amount thereof  accounted for as indebtedness
in accordance with such principles.

         "Cash  Equivalents" shall mean, as to any Person, (i) securities issued
or directly and fully  guaranteed  or insured by the United States or any agency
or  instrumentality  thereof  (provided  that the full  faith and  credit of the
United States is pledged in support thereof) having  maturities of not more than
twelve months from the date of acquisition,  (ii) marketable direct  obligations
issued by any state of the United  States or any  political  subdivision  of any
such state or any public  instrumentality  thereof maturing within twelve months
from the date of acquisition thereof and, at the time of acquisition, having one
of the two highest  ratings  obtainable  from either  Standard & Poor's  Ratings
Services or Moody's  Investors  Service,  Inc.,  (iii) Dollar  denominated  time
deposits,  bankers acceptance and certificates of deposit of any commercial bank
having, or which is the principal  banking  subsidiary of a bank holding company
having,  a long-term  unsecured  debt  rating of at least "A" or the  equivalent
thereof  from  Standard  & Poor's  Ratings  Services  or "A2" or the  equivalent
thereof from Moody's  Investors  Service,  Inc. with maturities of not more than
twelve  months from the date of  acquisition  by such  Person,  (iv)  repurchase
obligations with a term of not more than seven days for underlying securities of
the types  described in clause (i) above  entered into with any bank meeting the
qualifications  specified in clause (iii) above,  (v) commercial paper issued by
any  Person  incorporated  in  the  United  States  rated  at  least  A-1 or the
equivalent  thereof by Standard & Poor's Ratings Services or at least P-1 or the
equivalent thereof by Moody's Investors Service,  Inc. and in each case maturing
not more than twelve  months  after the date of  acquisition  by such Person and
(vi)  investments  in money market funds  substantially  all of whose assets are
comprised of securities of the types described in clauses (i) through (v) above.

         "CERCLA"   shall  mean  the   Comprehensive   Environmental   Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. ss. 9601 et seq.

         "Change of Control" shall mean (i) Howard R. Curd shall at any time and
for any reason fail to own at least 80% of the economic and voting  interests in
the  Borrower'  capital  stock  which he owned as of the  Closing  Date,  (ii) a
"change  of  control"   or  similar   event  shall  occur  as  provided  in  any
documentation evidencing or governing the Borrower's or any of its Subsidiaries'
Indebtedness,  and (iii) a change  of  control  of the  Borrower  that  would be
required to be reported in response to Item 6(e) of Schedule  14A of  Regulation
14A, as in effect on the

                                       40
<PAGE>
date hereof,  promulgated under the Securities  Exchange Act of 1934, as amended
(the "Exchange Act"),  shall occur;  provided that, without  limitation,  such a
Change of Control shall be deemed to occur if: (A) any "Person" (as such term is
used in ss.13(d)  and  ss.14(d) of the  Exchange  Act),  except for any employee
benefit plan of the Borrower or any  Subsidiary or related  corporation,  or any
entity holding voting securities of the Borrower for or pursuant to the terms of
any such plan,  shall become the beneficial  owner,  directly or indirectly,  of
securities of the Borrower representing 25% or more of the combined voting power
of the Borrower's then outstanding securities; (B) there shall occur a contested
proxy solicitation of the Borrower's shareholders that results in the contesting
party obtaining the ability to vote securities  representing  25% or more of the
combined  voting power of the  Borrower's  then-outstanding  securities;  or (C)
there  shall  occur:  (1) a sale,  exchange,  transfer or other  disposition  of
substantially all of the assets of the Borrower to another entity,  except to an
entity controlled  directly or indirectly by the Borrower or by the same Persons
that controlled the Borrower immediately prior to such sale, exchange,  transfer
or other  disposition,  (2) a merger or consolidation in which the Borrower is a
constituent unless the surviving entity is controlled  directly or indirectly by
the same Persons that controlled the Borrower  immediately  prior to such merger
or  consolidation or (3) the adoption of a plan of liquidation or dissolution of
the Borrower other than pursuant to bankruptcy or insolvency  laws. For purposes
of this definition  "control",  when used with respect to any specified  Person,
means the power to direct the management  and policies of such Person,  directly
or indirectly,  whether through the ownership of voting securities,  by contract
or otherwise;  and the terms  "controlling"  and "controlled"  have the meanings
correlative to the foregoing.

         "Change of Law" shall have the meaning provided in Section 8.06.

         "Closing Date" shall have the meaning provided in Section 11.09.

         "Code"  shall mean the Internal  Revenue Code of 1986,  as amended from
time to time, and the  regulations  promulgated  and rulings issued  thereunder.
Section references to the Code are to the Code, as in effect at the date of this
Agreement  and  any  subsequent  provisions  of the  Code,  amendatory  thereof,
supplemental thereto or substituted therefor.

         "Collateral"  shall mean all property  (whether real or personal)  with
respect to which any security  interests  have been granted (or  purported to be
granted) pursuant to any Security Document,  including,  without limitation, all
Security Agreement Collateral.

         "Collective  Bargaining  Agreements" shall have the meaning provided in
Section 4.05.

         "Commitment" shall mean the amount set forth opposite the Lender's name
in Schedule I directly below the column entitled  "Commitment," as same shall be
terminated pursuant to Sections 2.01 and/or 8.

         "Contingent Obligation" shall mean, as to any Person, any obligation of
such  Person as a result of such  Person  being a general  partner  of the other
Person,  unless the underlying  obligation is expressly made  non-recourse as to
such general partner, and any

                                       41
<PAGE>
obligation   of  such  Person   guaranteeing   or  intended  to  guarantee   any
Indebtedness,  leases, dividends or other obligations ("primary obligations") of
any other  Person (the  "primary  obligor") in any manner,  whether  directly or
indirectly,  including,  without  limitation,  any  obligation  of such  Person,
whether or not  contingent,  (i) to purchase any such primary  obligation or any
property  constituting direct or indirect security therefor,  (ii) to advance or
supply funds (x) for the purchase or payment of any such primary  obligation  or
(y) to maintain  working  capital or equity  capital of the  primary  obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property,  securities or services primarily for the purpose of assuring
the owner of any such primary  obligation of the ability of the primary  obligor
to make payment of such primary  obligation or (iv)  otherwise to assure or hold
harmless the holder of such primary  obligation against loss in respect thereof;
provided,  however,  that the  term  Contingent  Obligation  shall  not  include
endorsements  of instruments for deposit or collection in the ordinary course of
business.  The  amount  of any  Contingent  Obligation  shall be deemed to be an
amount equal to the stated or determinable  amount of the primary  obligation in
respect  of which  such  Contingent  Obligation  is made or,  if not  stated  or
determinable,  the maximum reasonably  anticipated  liability in respect thereof
(assuming  such Person is required to perform  thereunder) as determined by such
Person in good faith.

         "Control Agreement" shall have the meaning provided in Section 6.10(d).

         "Conversion" shall have the meaning provided in Section 10.01(a).

         "Conversion   Notice"  shall  have  the  meaning  provided  in  Section
10.01(b).

         "Conversion Price" shall have the meaning provided in Section 10.01(a).

         "Conversion Shares" shall have the meaning provided in Section 5.14(b).

         "Credit  Documents"  shall mean this Agreement and, after the execution
and delivery  thereof  pursuant to the terms of this  Agreement,  the Note,  the
Subsidiaries Guaranty and each Security Document.

         "Credit Party" shall mean the Borrower and each Subsidiary Guarantor.

         "Current  Market  Price"  shall  mean,  in  respect of any share of UTC
Common  Stock on any date  herein  specified,  the  average of the daily  market
prices for 30 consecutive Business Days commencing 45 days before such date. The
daily market  price for each such  Business Day shall be (i) the last sale price
on such day on the principal  stock  exchange or NASDAQ  National  Market System
("NASDAQ-NMS")  on which such UTC Common  Stock is then  listed or  admitted  to
trading,  (ii) if no sale  takes  place  on such  day on any  such  exchange  or
NASDAQ-NMS,  the average of the last  reported  closing bid and asked  prices on
such day as officially  quoted on any such exchange or NASDAQ-NMS,  (iii) if the
UTC Common Stock is not then listed or admitted to trading on any stock exchange
or NASDAQ-NMS,  the average of the last reported closing bid and asked prices on
such  day  in  the  over-the-counter   market,  as  furnished  by  the  National
Association of Securities  Dealers  Automatic  Quotation  System or the National
Quotation Bureau,  Inc., (iv) if neither such corporation at the time is engaged
in the business of

                                       42
<PAGE>
reporting  such  prices,  as  furnished by any similar firm then engaged in such
business,  or (v) if there is no such firm,  as  furnished  by any member of the
National  Association of Securities  Dealers ("NASD")  selected  mutually by the
Lender and Company or, if they cannot agree upon such selection,  as selected by
two such  members of the NASD,  one of which shall be selected by the Lender and
one of which shall be selected by the Borrower.

         "Default"  shall mean any event,  act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.

         "Disposition"  shall mean the sale,  transfer,  or other disposition of
the  Adhesives  Division of the Borrower for cash in an amount at least equal to
the amount of the Loan.

         "Disposition  Documents"  shall mean the  documents  which  effect,  or
otherwise evidence,  the Disposition,  which shall, in all events, be reasonably
satisfactory to the Lender.

         "Dividend" shall mean, with respect to any Person, that such Person has
declared or paid a dividend or returned any equity capital to its  stockholders,
partners or members or  authorized  or made any other  distribution,  payment or
delivery of property  (other  than common  stock of such  Person) or cash to its
stockholders,  partners or members as such, or redeemed,  retired,  purchased or
otherwise  acquired,  directly or indirectly,  for a consideration any shares of
any  class of its  capital  stock or any  partnership  or  membership  interests
outstanding  on or after the Closing Date (or any options or warrants  issued by
such Person with respect to its capital stock or other equity interests), or set
aside any funds for any of the foregoing  purposes,  or shall have permitted any
of its  Subsidiaries to purchase or otherwise  acquire for a  consideration  any
shares  of any  class of the  capital  stock or any  partnership  or  membership
interests  of such  Person  outstanding  on or after  the  Closing  Date (or any
options or warrants  issued by such Person with respect to its capital  stock or
other equity  interests).  Without  limiting  the  foregoing,  "Dividends"  with
respect to any Person  shall also  include all  payments  made or required to be
made by such Person with respect to any stock appreciation rights, plans, equity
incentive  or  achievement  plans or any similar  plans or setting  aside of any
funds for the foregoing purposes.

         "Documents" shall mean the Credit Documents and the Sale Documents.

         "Dollars" and the sign "$" shall each mean freely  transferable  lawful
money of the United States.

         "Domestic  Subsidiary"  shall mean each Subsidiary of the Borrower that
is  incorporated  under the laws of the United States,  any State thereof or the
District of Columbia.

         "Employment  Agreements"  shall have the  meaning  provided  in Section
4.05.

         "Environmental   Claims"   shall  mean  any  and  all   administrative,
regulatory or judicial  actions,  suits,  demands,  demand letters,  directives,
claims,  liens,  notices  of  noncompliance  or  violation,   investigations  or
proceedings  relating in any way to any  Environmental Law or any permit issued,
or any approval given, under any such  Environmental Law (hereafter,  "Claims"),
including,  without  limitation,  (a) any  and all  Claims  by  governmental  or
regulatory authorities for enforcement,  cleanup, removal, response, remedial or
other actions or damages pursuant to any

                                       43
<PAGE>
applicable  Environmental  Law,  and (b) any and all  Claims by any third  party
seeking damages, contribution,  indemnification,  cost recovery, compensation or
injunctive  relief  in  connection  with  alleged  injury or threat of injury to
health, safety or the environment due to the presence of Hazardous Materials.

         "Environmental  Law" shall mean any  Federal,  state,  foreign or local
statute, law, rule, regulation,  ordinance, code, guideline,  written policy and
rule of common law now or hereafter  in effect and in each case as amended,  and
any judicial or administrative interpretation thereof, including any judicial or
administrative  order, consent decree or judgment,  relating to the environment,
employee  health  and  safety  or  Hazardous   Materials,   including,   without
limitation,  CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C.ss.
1251 et seq.; the Toxic Substances  Control Act, 15 U.S.C. ss. 2601 et seq.; the
Clean Air Act,  42 U.S.C.  ss.  7401 et seq.;  the Safe  Drinking  Water Act, 42
U.S.C.  ss. 3803 et seq.;  the Oil Pollution Act of 1990, 33 U.S.C.  ss. 2701 et
seq.;  the Emergency  Planning and the Community  Right-to-Know  Act of 1986, 42
U.S.C. ss. 11001 et seq.; the Hazardous Material  Transportation  Act, 49 U.S.C.
ss. 1801 et seq.; the  Occupational  Safety and Health Act, 29 U.S.C. ss. 651 et
seq.; and any state and local or foreign  counterparts or  equivalents,  in each
case as amended from time to time.

         "ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder.  Section  references to ERISA are to ERISA, as in effect at the date
of this Agreement and any subsequent  provisions of ERISA,  amendatory  thereof,
supplemental thereto or substituted therefor.

         "ERISA Affiliate" shall mean each person (as defined in Section 3(9) of
ERISA) which together with the Borrower or a Subsidiary of the Borrower would be
deemed to be a "single employer" (i) within the meaning of Section 414(b),  (c),
(m) or (o) of the Code or (ii) as a result of the  Borrower or a  Subsidiary  of
the Borrower being or having been a general partner of such person.

         "Event of Default" shall have the meaning provided in Section 8.

         "Existing  Indebtedness"  shall have the  meaning  provided  in Section
5.22.

         "Existing  Indebtedness  Agreements" shall have the meaning provided in
Section 4.05.

         "Final   Maturity  Date"  shall  mean  the  earlier  to  occur  of  the
consummation of the  Disposition and the second year  anniversary of the Closing
Date.

         "Foreign  Pension Plan" shall mean any plan, fund  (including,  without
limitation,  any  superannuation  fund) or other similar program  established or
maintained  outside the United  States by the Borrower or any one or more of its
Subsidiaries  primarily  for the benefit of  employees  of the  Borrower or such
Subsidiaries  residing  outside the United  States,  which  plan,  fund or other
similar program provides, or results in, retirement income, a deferral of income
in

                                       44
<PAGE>
contemplation  of  retirement  or  payments  to  be  made  upon  termination  of
employment, and which plan is not subject to ERISA or the Code.

         "Foreign  Subsidiary"  shall mean each Subsidiary of the Borrower which
is not a Domestic Subsidiary.

         "Fund  Affiliate"  shall mean,  with  respect to any Person,  any other
Person  directly or indirectly  controlling,  controlled  by, or under direct or
indirect  common  control with such Person.  A Person shall be deemed to control
another Person if such first Person possesses, directly or indirectly, the power
(i) to vote 50% or more of the securities  having  ordinary voting power for the
election of directors of such Person or (ii) to direct or cause the direction of
the  management  and policies of such Person,  whether  through the ownership of
voting securities, by contract or otherwise.

         "Hazardous  Materials"  shall  mean  (a)  any  petroleum  or  petroleum
products,  radioactive  materials,  asbestos in any form that is  friable,  urea
formaldehyde  foam  insulation,  transformers  or other  equipment that contains
dielectric fluid containing levels of polychlorinated  biphenyls, and radon gas;
(b) any  chemicals,  materials  or  substances  defined  as or  included  in the
definition of "hazardous  substances," "hazardous waste," "hazardous materials,"
"extremely   hazardous   substances,"   "restricted   hazardous  waste,"  "toxic
substances,"  "toxic  pollutants,"  "contaminants," or "pollutants," or words of
similar  import,  under  any  applicable  Environmental  Law;  and (c) any other
chemical, material or substance, the Release of which is prohibited,  limited or
regulated by any governmental authority.

         "Indebtedness" shall mean, as to any Person,  without duplication,  (i)
all  indebtedness  (including  principal,  interest,  fees and  charges) of such
Person for  borrowed  money or for the  deferred  purchase  price of property or
services,  (ii) the maximum  amount  available  to be drawn under all letters of
credit,  bankers'  acceptances and similar obligations issued for the account of
such  Person and all  unpaid  drawings  in  respect  of such  letters of credit,
bankers'  acceptances  and similar  obligations,  (iii) all  Indebtedness of the
types described in clause (i), (ii), (iv), (v), (vi) or (vii) of this definition
secured by any Lien on any property  owned by such  Person,  whether or not such
Indebtedness  has been assumed by such Person  (provided that, if the Person has
not assumed or otherwise  become  liable in respect of such  Indebtedness,  such
Indebtedness  shall be deemed to be in an amount  equal to the fair market value
of the property to which such Lien relates as  determined  in good faith by such
Person), (iv) the aggregate amount required to be capitalized under leases under
which such Person is the  lessee,  (v) all  obligations  of such Person to pay a
specified  purchase  price for goods or  services,  whether or not  delivered or
accepted,  i.e.,  take-or-pay  and  similar  obligations,  (vi)  all  Contingent
Obligations of such Person,  and (vii) all  obligations  under any Interest Rate
Protection  Agreement,  any Other Hedging Agreement or under any similar type of
agreement.  Notwithstanding the foregoing,  Indebtedness shall not include trade
payables  and  accrued  expenses  incurred  by any  Person  in  accordance  with
customary practices and in the ordinary course of business of such Person.

         "Intercompany   Loan"  shall  have  the  meaning  provided  in  Section
7.05(ix).

                                       45
<PAGE>
         "Intercompany  Note"  shall  mean a  promissory  note,  in the  form of
Exhibit H, evidencing Intercompany Loans.

         "Interest Rate Protection  Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest collar agreement, interest rate
hedging agreement or other similar agreement or arrangement.

         "Investments" shall have the meaning provided in Section 7.05.

         "Joint  Venture  Company" shall mean Uniroyal  Optoelectronics,  LLC, a
Delaware limited liability company.

         "Leaseholds" of any Person shall mean all the right, title and interest
of such  Person as lessee or  licensee  in, to and under  leases or  licenses of
land, improvements and/or fixtures.

         "Lender" shall have the meaning provided in the first paragraph to this
Agreement.

         "Lien"  shall mean any  mortgage,  pledge,  hypothecation,  assignment,
deposit  arrangement,   encumbrance,  lien  (statutory  or  other),  preference,
priority  or  other  security   agreement  of  any  kind  or  nature  whatsoever
(including,  without  limitation,  any conditional sale or other title retention
agreement,  any financing or similar  statement or notice filed under the UCC or
any  other  similar   recording  or  notice   statute,   and  any  lease  having
substantially the same effect as any of the foregoing).

         "Loan" shall have the meaning provided in Section 1.01.

         "Management  Agreements"  shall have the  meaning  provided  in Section
4.05.

         "Margin Stock" shall have the meaning provided in Regulation U.

         "Material  Adverse Effect" shall mean (i) a material  adverse effect on
the business, operations,  properties, assets, liabilities, condition (financial
or  otherwise)  or  prospects  of  the  Borrower  or of  the  Borrower  and  its
Subsidiaries  taken  as a whole or (ii) a  material  adverse  effect  (x) on the
rights or remedies of the Lender hereunder or under any other Credit Document or
(y) on the ability of any Credit Party to perform its  obligations to the Lender
hereunder or under any other Credit Document.

         "Minimum Borrowing Amount" shall mean $100,000.

         "Monthly  Payment  Date"  shall  mean  the  last  Business  Day of each
calendar month occurring after September 1, 2001.

         "NAIC" shall mean the National Association of Insurance Commissioners.

         "NASDAQ-NMS"  shall have the meaning  provided for in the definition of
"Current Market Price" as set forth in this Article IX.

                                       46
<PAGE>
         "Net Debt  Proceeds"  shall mean,  with  respect to any  incurrence  of
Indebtedness  for  borrowed  money,  the  cash  proceeds  (net  of  underwriting
discounts and  commissions  and other  reasonable  costs  associated  therewith)
received  by the  respective  Person  from  the  respective  incurrence  of such
Indebtedness for borrowed money.

         "Net Equity Proceeds" shall mean, with respect to each issuance or sale
of any equity by any Person or any capital contribution to such Person, the cash
proceeds (net of underwriting  discounts and  commissions  and other  reasonable
costs associated  therewith) received by such Person from the respective sale or
issuance of its equity or from the respective capital contribution.

         "Net  Insurance  Proceeds"  shall mean,  with  respect to any  Recovery
Event,  the cash  proceeds  (net of  reasonable  costs  and  taxes  incurred  in
connection  with such  Recovery  Event)  received  by the  respective  Person in
connection with such Recovery Event.

         "Net Sale  Proceeds"  shall mean,  for any Asset  Sale,  the gross cash
proceeds  (including any cash received by way of deferred  payment pursuant to a
promissory  note,  receivable  or  otherwise,  but  only as and  when  received)
received  from such sale of  assets,  net of the  reasonable  costs of such sale
(including fees and commissions,  payments of unassumed  liabilities relating to
the  assets  sold  and  required  payments  of  any  Indebtedness   (other  than
Indebtedness secured pursuant to the Security Documents) which is secured by the
respective assets which were sold), and the incremental taxes paid or payable as
a result of such Asset Sale.

         "Non-Compete  Agreements"  shall have the  meaning  provided in Section
4.05.

         "Note" shall have the meaning provided in Section 1.05(a).

         "Notice of Borrowing" shall have the meaning provided in Section 1.02.

         "Notice  Office"  shall mean the  office of the  Lender  located at 145
Belmont Drive, Somerset, New Jersey 08873, Attention: Chief Financial Officer or
such other office or person as the Lender may hereafter  designate in writing as
such to the other parties hereto.

         "Obligations"  shall mean all amounts  owing to the Lender  pursuant to
the terms of this Agreement or any other Credit Document.

         "Organic Change" shall have the meaning provided in Section 10.01(g).

         "Other Hedging  Agreement" shall mean any foreign  exchange  contracts,
currency swap agreements,  commodity  agreements or other similar  agreements or
arrangements designed to protect against the fluctuations in currency values.

         "PBGC" shall mean the Pension Benefit Guaranty Corporation  established
pursuant to Section 4002 of ERISA, or any successor thereto.

         "Permitted Liens" shall have the meaning provided in Section 7.01.

                                       47
<PAGE>
         "Person" shall mean any individual,  partnership,  joint venture, firm,
corporation,  association,  limited liability company, trust or other enterprise
or any  government  or  political  subdivision  or  any  agency,  department  or
instrumentality thereof.

         "Plan" shall mean any pension plan as defined in Section 3(2) of ERISA,
which is maintained or  contributed to by (or to which there is an obligation to
contribute  of)  the  Borrower  or a  Subsidiary  of the  Borrower  or an  ERISA
Affiliate, and each such plan for the five year period immediately following the
latest date on which the  Borrower,  a  Subsidiary  of the  Borrower or an ERISA
Affiliate maintained,  contributed to or had an obligation to contribute to such
plan.

         "Pricing Date" shall have the meaning provided in Section 10.1(a).

         "Prime Rate" shall mean the rate which Bankers Trust Company  announces
from time to time as its prime lending  rate,  the Prime Rate to change when and
as such prime lending rate changes.

         "Projections" shall mean the projections, delivered to the Lender on or
about the Closing  Date,  which were prepared by or on behalf of the Borrower in
connection with the Transaction and delivered to the Lender prior to the Closing
Date.

         "Qualified  Preferred  Stock"  shall  mean any  preferred  stock of the
Borrower so long as the terms of any such preferred stock (w) do not contain any
mandatory put,  redemption,  repayment,  sinking fund or other similar provision
prior to December  31, 2011,  (x) do not require the cash payment of  dividends,
(y) do not contain any covenants (other than reporting  covenants),  and (z) are
otherwise reasonably satisfactory to the Lender.

         "RCRA" shall mean the Resource  Conservation  and Recovery  Act, as the
same may be amended from time to time, 42 U.S.C. ss. 6901 et seq.

         "Real  Property"  of any Person  shall  mean all the  right,  title and
interest of such Person in and to land,  improvements  and  fixtures,  including
Leaseholds.

         "Recovery  Event"  shall mean the receipt by the Borrower or any of its
Subsidiaries of any cash insurance  proceeds or condemnation  awards payable (i)
by reason of theft,  loss,  physical  destruction,  damage,  taking or any other
similar  event with  respect to any property or assets of the Borrower or any of
its  Subsidiaries  and  (ii)  under  any  policy  of  insurance  required  to be
maintained under Section 6.03.

         "Register" shall have the meaning provided in Section 11.15.

         "Registration  Rights  Agreement" shall mean that certain  Registration
Rights  Agreement  dated as of August 2, 2001, by and between the Lender and the
Borrower.

         "Regulation D" shall mean Regulation D of the Board of Governors of the
Federal  Reserve  System as from time to time in effect and any successor to all
or a portion thereof establishing reserve requirements.

                                       48
<PAGE>
         "Regulation T" shall mean Regulation T of the Board of Governors of the
Federal  Reserve  System as from time to time in effect and any successor to all
or a portion thereof.

         "Regulation U" shall mean Regulation U of the Board of Governors of the
Federal  Reserve  System as from time to time in effect and any successor to all
or a portion thereof.

         "Regulation X" shall mean Regulation X of the Board of Governors of the
Federal  Reserve  System as from time to time in effect and any successor to all
or a portion thereof.

         "Release" shall mean the disposing,  discharging,  injecting, spilling,
pumping, leaking, leaching,  dumping, emitting,  escaping,  emptying, pouring or
migrating, into or upon any land or water or air, or otherwise entering into the
environment.

         "Reportable  Event" shall mean an event described in Section 4043(c) of
ERISA with  respect  to a Plan that is  subject to Title IV of ERISA  other than
those events as to which the 30-day  notice  period is waived  under  subsection
 .22, .23, .25, .27 or .28 of PBGC Regulation Section 4043.

         "Sale" shall mean the sale of the Lender's limited liability membership
interest  in  the  Joint  Venture  Company  to  the  Borrower  (or a  Subsidiary
Guarantor)  pursuant to, and in accordance with the terms of, the Sale Documents
on or before the Closing Date.

         "Sale  Documents"  shall  mean  the (i)  MEMBERSHIP  INTEREST  PURCHASE
AGREEMENT  dated as of  August  2,  2001 by and  among  the  Borrower,  Uniroyal
Compound  Semiconductor Inc., a Delaware  corporation,  UOE and the Lender, (ii)
Registration Rights Agreement, (iii) Amendment to the Amended and Restated Joint
Venture Agreement dated November 30, 1998, by and among the Lender, the Borrower
and UOE, dated as of August 2, 2001, (iv) New Technology License Agreement dated
as of August 2, 2001,  by and  between the Lender and the  Borrower  and (v) all
ancillary or incidental  related documents or agreements  referred to in each of
the foregoing.

         "SEC" shall have the meaning provided in Section 6.01(h).

         "Securities Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.

         "Security Agreement" shall have the meaning provided in Section 4.09.

         "Security Agreement  Collateral" shall mean all "Collateral" as defined
in the Security Agreement.

         "Security  Document"  shall  mean  and  include  each  of the  Security
Agreement,  the Control Agreement and, after the execution and delivery thereof,
each Additional Security Document.

         "Shareholder   Subordinated   Note"  shall  mean  an  unsecured  junior
subordinated note issued by the Borrower (and not guaranteed or supported in any
way by any  Subsidiary of

                                       49
<PAGE>
the Borrower) in the form of Exhibit I  (appropriately  completed),  as amended,
modified or supplemented  from time to time in accordance with the terms thereof
and hereof.

         "Shareholders'  Agreements"  shall have the meaning provided in Section
4.05.

         "Specified Default" shall mean (i) a Default under Section 6.01(a), (b)
or (c), 8.01 or 8.05 and (ii) any Event of Default.

         "Subsidiaries  Guaranty"  shall have the  meaning  provided  in Section
4.10.

         "Subsidiary"  shall mean, as to any Person,  (i) any  corporation  more
than 50% of whose  stock of any class or  classes  having  by the terms  thereof
ordinary  voting power to elect a majority of the directors of such  corporation
(irrespective  of  whether  or not at the time  stock of any class or classes of
such  corporation  shall  have or  might  have  voting  power by  reason  of the
happening of any  contingency) is at the time owned by such Person and/or one or
more  Subsidiaries of such Person and (ii) any  partnership,  limited  liability
company, association,  joint venture or other entity in which such Person and/or
one or more  Subsidiaries  of such Person has more than a 50% equity interest at
the time.

         "Subsidiary  Guarantor"  shall  mean  each  of  (i)  Uniroyal  Compound
Semiconductors,  Inc., a Delaware  corporation,  (ii) Uniroyal  Optoelectronics,
LLC, a Delaware  corporation,  (iii)  Sterling  Semiconductor,  Inc., a Delaware
corporation,  (iv)  NorLux  Corp.,  a  Delaware  corporation,  and (v)  Uniroyal
Optoelectronics Service Company, Inc., a Delaware corporation.

         "Tax Benefit" shall have the meaning provided in Section 3.04(c).

         "Tax  Sharing  Agreements"  shall have the meaning  provided in Section
4.05.

         "Taxes" shall have the meaning provided in Section 3.04(a).

         "Transaction" shall mean, collectively, (i) the Sale, (ii) the entering
into of the Credit  Documents  and the borrowing of the Loan on the Closing Date
by the  Borrower  and (iii) the payment of all fees and  expenses in  connection
with the foregoing.

         "UCC"  shall mean the Uniform  Commercial  Code as from time to time in
effect in the relevant jurisdiction.

         "Unfunded Current Liability" of any Plan shall mean the amount, if any,
by which the actuarial  present value of the accumulated plan benefits under the
Plan  determined  on a plan  termination  basis  in  accordance  with  actuarial
assumptions  at such  time  consistent  with  those  prescribed  by the PBGC for
purposes of Section  4044 of ERISA,  exceeds  the fair market  value of all plan
assets  allocable to such  liabilities  under Title IV of ERISA  (excluding  any
accrued but unpaid contribution).

         "United  States"  and  "U.S."  shall  each  mean the  United  States of
America.

                                       50
<PAGE>
         "UOE" shall have the meaning provided in Section 7.12.

         "UTC  Common  Stock"  shall  mean  shares  of the  common  stock of the
Borrower.

         "Wholly-Owned  Domestic Subsidiary" shall mean each Domestic Subsidiary
of the Borrower that is also a Wholly-Owned Subsidiary of the Borrower.

         "Wholly-Owned Foreign Subsidiary" shall mean each Foreign Subsidiary of
the Borrower that is also a Wholly-Owned Subsidiary of the Borrower.

         "Wholly-Owned  Subsidiary"  shall  mean,  as to  any  Person,  (i)  any
corporation  100% of whose  capital  stock  (other  than  director's  qualifying
shares) is at the time  owned by such  Person  and/or  one or more  Wholly-Owned
Subsidiaries of such Person and (ii) any partnership, limited liability company,
association,  joint  venture or other entity in which such Person  and/or one or
more Wholly-Owned Subsidiaries of such Person has a 100% equity interest at such
time.

         SECTION 10. Conversion.

         10.01 Conversion of Note.

         (a) Subject to the provisions for adjustment hereinafter set forth, the
Note shall be convertible, in whole or in part, at any time after the Additional
Interest Trigger Date, at the option of the Lender (a  "Conversion"),  up to the
outstanding  principal  amount  of the Note plus  accrued  but  unpaid  interest
thereon held by Lender at the time of such  conversion into that number of fully
paid and  nonassessable  shares of UTC Common  Stock  equal to (x) the  quotient
obtained  by  dividing  (A) the  principal  amount of the Note plus  accrued but
unpaid  interest  thereon  to be  converted  by (B)  the  Conversion  Price  (as
hereinafter defined) minus (y) any additional interest paid on overdue principal
that has been  paid or is owing in UTC  Common  Stock;  subject  to the  proviso
contained  in this  Section  10.01(a).  The  conversion  price (the  "Conversion
Price")  shall be the average  closing  price of UTC Common Stock as reported on
NASDAQ-NSM  (or, if NASDAQ-NSM is not available,  a similar  generally  accepted
reporting  service in the United  States of America  or, if such  service is not
available,  a price  determined  in good faith by the Board of  Directors of the
Borrower)  for a period of fourteen  (14)  Business  Days  consisting of (x) the
seven (7) Business Days prior to the notice of conversion,  (y) the Business Day
of the  issuance  of the  Conversion  Notice by the  Lender  and (z) the six (6)
Business Days following the issuance of the  Conversion  Notice (but in no event
shall the Conversion  Price be higher than $8.39 or lower than $6.87,  provided,
however,  that the  foregoing  amounts shall be  appropriately  adjusted to give
effect to adjustments to the Conversion  Price,  from time to time,  pursuant to
Section 10.01(f)) and shall be subject to further  adjustments from time to time
pursuant to Section 10.01. The transfer and delivery of the UTC Common shares to
the Lender shall take place three (3) Business Days  following the last day used
to calculate the  Conversion  Price (such earlier date,  the "Pricing  Date" and
such  later  date,  the  "Conversion  Date");  provided,  however,  that  (x) no
fractional  shares  shall be issued  upon the  conversion  of the Note,  (y) all
shares  of  UTC  Common  Stock  (including   fractions  thereof)  issuable  upon
conversion  of the  Note by the  Lender  shall be  aggregated  for  purposes  of
determining  whether  conversion  would result in the issuance of any fractional
share and (z) if, after the  aforementioned  aggregation,  the

                                       51
<PAGE>
conversion  would  result in the issuance of a fraction of a share of UTC Common
Stock, Borrower shall, in lieu of issuing any fractional share, pay Lender a sum
in  cash  equal  to the  Conversion  Price  of  such  fraction  on the  date  of
conversion.

         (b) A  Conversion  may be effected by the Lender upon the  surrender to
Borrower at the principal  office of the Borrower of the Note  accompanied  by a
written  notice  stating  that the Lender  elects to convert  all or a specified
amount of its Note in  accordance  with the  provisions  of this  Section 10 and
specifying  the  name or  names  in  which  Lender  wishes  the  certificate  or
certificates  for  shares  of UTC  Common  Stock to be issued  (the  "Conversion
Notice").

         (c) In case the  Conversion  Notice shall specify a name or names other
than that of the Lender,  such Conversion Notice shall be accompanied by payment
of all transfer taxes payable upon the issuance of shares of UTC Common Stock in
such name or names.  Other than such taxes,  Borrower will pay any and all taxes
(other  than  taxes  based on  income)  that may be  payable  in  respect of any
issuance  or delivery of shares of UTC Common  Stock upon a  Conversion.  On the
Conversion  Date and upon, if applicable,  payment of all transfer taxes (or the
demonstration  to the reasonable  satisfaction  of Borrower that such taxes have
been paid),  Borrower shall deliver or cause to be delivered (1)  certificate(s)
representing  the number of validly issued,  fully paid and  nonassessable  full
shares of UTC Common Stock to which the holder of the Note being converted shall
be entitled and (2) if less than all of principal  amount of the Note  evidenced
by  the  surrendered  Note  is  being  converted,   in  exchange  for  the  Note
surrendered,  a new Note,  of like tenor,  in a principal  amount equal the full
principal  amount  of the Note  surrendered  less  the  principal  amount  being
converted.

         (d) A  Conversion  shall be  deemed  to have  been made at the close of
business  on the  Pricing  Date  and of such  surrender  of the  certificate  or
certificates  representing  the Note to be  converted  so that the rights of the
holder thereof as to the Note being  converted  shall cease except for the right
to receive  shares of UTC Common Stock in  accordance  herewith,  and the Person
entitled  to receive  the shares of UTC Common  Stock  shall be treated  for all
purposes as having  become the record  holder of such shares of UTC Common Stock
at such time.

         (e)  Borrower  shall  at all  times  reserve,  and keep  available  for
issuance upon a Conversion, such number of its authorized but unissued shares of
UTC Common Stock as will from time to time be  sufficient to permit a Conversion
of all of the  outstanding  principal  balance  of the Note,  and shall take all
action required to increase the authorized  number of shares of UTC Common Stock
if  necessary  to permit  the  Conversion  of all of the  outstanding  principal
balance of the Note.

         (f) The  Conversion  Price will be subject to  adjustment  from time to
time as follows:

         (i) In case  Borrower  shall at any time or from time to time after the
    Closing Date (A) pay a dividend, or make a distribution,  on the outstanding
    shares of UTC Common Stock in shares of UTC Common Stock,  (B) subdivide the
    outstanding  shares of UTC Common Stock, (C) combine the outstanding  shares
    of UTC  Common  Stock  into a  smaller  number  of  shares  or (D)  issue by
    reclassification  of the  shares of UTC

                                       52
<PAGE>
    Common Stock any shares of capital stock of Borrower, then, and in each such
    case, the Conversion Price in effect  immediately prior to such event or the
    record date  therefor,  whichever is earlier,  shall be adjusted so that the
    holder of the Note thereafter  surrendered for Conversion  shall be entitled
    to receive the number of shares of UTC Common Stock or other  securities  of
    Borrower  which  Lender  would have owned or have been  entitled  to receive
    after the happening of any of the events described above, had such Note been
    surrendered for conversion  immediately prior to the happening of such event
    or the record date  therefor,  whichever  is  earlier.  An  adjustment  made
    pursuant to this Section  10.01(f)(i) shall become effective (x) in the case
    of any  such  dividend  or  distribution,  immediately  after  the  close of
    business  on the record date for the  determination  of holders of shares of
    UTC Common Stock entitled to receive such dividend or  distribution,  or (y)
    in the case of such  subdivision,  reclassification  or combination,  at the
    close of  business  on the day upon  which  such  corporate  action  becomes
    effective.  No  adjustment  shall be made  pursuant  to this  clause  (i) in
    connection with any transaction to which Section 10(g) applies.

         (ii) In case  Borrower  shall  issue  shares  of UTC  Common  Stock (or
    rights,  warrants or other  securities  convertible into or exchangeable for
    shares of UTC Common Stock) after the Closing Date,  other than (A) pursuant
    to obligations existing on the date hereof,  including,  without limitation,
    obligations  under agreements with existing  lenders,  outstanding  options,
    rights,  warrants or other  securities  convertible into or exchangeable for
    shares of UTC Common  Stock,  or pursuant to any existing  employee  benefit
    plan, (B) pursuant to any joint venture or other  strategic  alliance,  with
    the prior  written  consent  of  Lender,  (C)  issuances  covered by Section
    10.01(f)(i),  and (D) issuances  pursuant to a registration  statement under
    the Securities Act, for  consideration  in an amount per share of UTC Common
    Stock (or having an exercise,  conversion or exchange  price per share) less
    than an amount  equal to 25% below the Current  Market  Price,  then (i) the
    number of shares of UTC Common Stock for which the Note is convertible shall
    be  adjusted  to equal the product  obtained  by  multiplying  the number of
    shares of UTC  Common  Stock for which the Note is  convertible  immediately
    prior to such issue or sale by a fraction  (A) the  numerator of which shall
    be the number of shares of UTC Common Stock  outstanding  immediately  after
    such issue or sale, and (B) the  denominator of which shall be the number of
    shares of UTC Common Stock  outstanding  immediately  prior to such issue or
    sale plus the number of shares  which the  aggregate  offering  price of the
    total number of such additional shares of UTC Common Stock would purchase at
    the then  Current  Market  Price;  and (ii) the  Conversion  Price as to the
    number of shares for which this Note is convertible prior to such adjustment
    shall be adjusted by multiplying such Conversion Price by a fraction (x) the
    numerator  of which  shall be the  number of shares  for which  this Note is
    convertible immediately prior to such issue or sale, and (y) the denominator
    of which  shall be the  number  of shares of UTC  Common  Stock  purchasable
    immediately after such issue or sale.

         (iii) An adjustment made pursuant to Section  10.01(f)(ii)  above shall
    be made on the next  Business  Day  following  the  date on  which  any such
    issuance is made and shall be effective retroactively  immediately after the
    close of  business on such date.  No

                                       53
<PAGE>
    adjustment shall be made pursuant to Section  10.01(f)(ii) in respect of any
    issuance of shares of UTC Common Stock on or prior to the Closing Date.  For
    purposes of Section 10.01(f)(ii),  the aggregate  consideration  received by
    Borrower in connection with the issuance of shares of UTC Common Stock or of
    rights, warrants or other securities exchangeable or convertible into shares
    of UTC Common Stock shall be deemed to be equal to the sum of the  aggregate
    offering  price of all such UTC Common Stock and such rights,  warrants,  or
    other  exchangeable or convertible  securities plus the aggregate amount, if
    any,  receivable  upon exchange or conversion  of any such  exchangeable  or
    convertible securities into shares of UTC Common Stock.

         (iv) In case Borrower  shall at any time or from time to time after the
    Closing Date declare,  order,  pay or make a dividend or other  distribution
    (including,   without  limitation,   any  distribution  of  stock  or  other
    securities or property or rights or warrants to subscribe for  securities of
    Borrower or any of its  Subsidiaries by way of dividend or spinoff),  on its
    UTC Common Stock,  other than  dividends or  distributions  of shares of UTC
    Common  Stock which are  referred to in clause (i) above and cash  dividends
    paid out of retained  earnings,  then the Conversion Price shall be adjusted
    so  that  it  shall  equal  the  price  determined  by  multiplying  (A) the
    applicable  Conversion Price on the day immediately prior to the record date
    fixed  for the  determination  of  stockholders  entitled  to  receive  such
    dividend or distribution by (B) a fraction,  the numerator of which shall be
    the  Current  Market  Price  per  share  of UTC  Common  Stock  on  the  day
    immediately  prior to such record  date less the amount of such  dividend or
    distribution  per share of UTC Common Stock,  and the  denominator  of which
    shall be such Current  Market Price per share of UTC Common Stock on the day
    immediately  prior to such record date. No adjustment shall be made pursuant
    to this Section  10.01(f)(iv)  in connection  with any  transaction to which
    Section 10.01(g) applies.

         (v) For purposes of this Section 10.01(f),  the number of shares of UTC
    Common  Stock at any time  outstanding  shall not  include any shares of UTC
    Common  Stock then owned or held by or for the account of Borrower or any of
    its Subsidiaries.

         (vi) If  Borrower  shall take a record of the holders of its UTC Common
    Stock for the  purpose of  entitling  them to  receive a  dividend  or other
    distribution,   and  shall   thereafter  and  before  the   distribution  to
    stockholders  thereof  legally  abandon  its  plan  to pay or  deliver  such
    dividend or  distribution,  then  thereafter  no adjustment in the number of
    shares of UTC Common Stock issuable upon exercise of the right of conversion
    granted by this Section  10.01(f) or in the Conversion  Price then in effect
    shall be required by reason of the taking of such record.

         (vii)   Anything   in   this   Section   10.01(f)   to   the   contrary
    notwithstanding,  Borrower  shall  not be  required  to give  effect  to any
    adjustment in the Conversion Price unless and until the net effect of one or
    more  adjustments  (each of which shall be carried  forward),  determined as
    above provided,  shall have resulted in a change of the Conversion  Price by
    at least 1%, and when the  cumulative net effect of more than one adjustment
    so

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<PAGE>
    determined  shall be to change the Conversion Price by at least one percent,
    such change in Conversion Price shall thereupon be given effect.

         (viii) If any option or warrant  expires or is canceled  without having
    been  exercised,  then, for the purposes of the adjustments set forth above,
    such  option or warrant  shall have been  deemed not to have been issued and
    the Conversion Price shall be adjusted accordingly.  No holder of UTC Common
    Stock which was previously issued upon conversion of the Note shall have any
    obligation  to redeem or cancel  any such  shares of UTC  Common  Stock as a
    result of the operation of this Section 10.01(f)(viii).

         (g) In case  of any  reorganization  of  capital,  reclassification  of
capital  stock  (other  than a  reclassification  of capital  subject to Section
10.01(f)(i)), consolidation or merger with or into another corporation, or sale,
transfer or  disposition  of all or  substantially  all the property,  assets or
business  of  Borrower  to another  corporation  (any one or more of such events
being an "Organic  Change"),  the Note then  outstanding,  shall  thereafter  be
convertible  into, in lieu of the UTC Common Stock issuable upon such Conversion
prior to consummation  of such Organic Change,  the kind and amount of shares of
stock and other  securities and property  receivable  (including  cash) upon the
consummation  of such Organic Change by a holder of that number of shares of UTC
Common  Stock  into  which the Note was  convertible  immediately  prior to such
Organic Change (including, on a pro rata basis, the cash, securities or property
received by holders of UTC Common Stock in any tender or exchange  offer that is
a step in such Organic  Change).  In case  securities or property other than UTC
Common Stock shall be issuable or deliverable upon conversion as aforesaid, then
all  references  in this Section  10.01(g)  shall be deemed to apply,  so far as
appropriate and nearly as may be, to such other securities or property.

         (h) In case at any time or from  time to time  Borrower  shall  pay any
stock dividend or make any other non-cash distribution to the holders of its UTC
Common Stock, or shall offer for subscription pro rata to the holders of its UTC
Common Stock any additional  shares of stock of any class or any other right, or
there shall be any capital  reorganization or reclassification of the UTC Common
Stock of Borrower or  consolidation  or merger of Borrower  with or into another
corporation, or any sale or conveyance to another corporation of the property of
Borrower as an entirety or  substantially  as an  entirety,  or there shall be a
voluntary or  involuntary  dissolution,  liquidation  or winding up of Borrower,
then,  in any one or more of said cases,  Borrower  shall give at least 20 days'
prior written notice to the registered holder of the Note at the address of each
as  shown on the  books of  Borrower  as of the date on which  (i) the  books of
Borrower  shall  close or a  record  shall be  taken  for such  stock  dividend,
distribution or subscription rights or (ii) such non-bankruptcy  reorganization,
reclassification,   consolidation,  merger,  sale  or  conveyance,  dissolution,
liquidation or winding up shall take place, as the case may be, provided that in
the case of any Organic Change to which Section  10.01(g) applies Borrower shall
give at least 20 days' prior written notice as aforesaid. Such notice shall also
specify the date as of which the holders of the UTC Common Stock of record shall
participate in such dividend,  distribution or  subscription  rights or shall be
entitled to exchange  their UTC Common Stock for  securities  or other  property
deliverable   upon   such   non-bankruptcy   reorganization,   reclassification,
consolidation,  merger,  sale or conveyance or participate in such  dissolution,
liquidation or

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<PAGE>
winding up, as the case may be. Failure to give such notice shall not invalidate
any action so taken.

         (i) Upon any adjustment of the Conversion  Price then in effect and any
increase or decrease in the number of shares of UTC Common Stock  issuable  upon
the operation of the conversion  set forth in this Section  10.01,  then, and in
each such case,  Borrower  shall  promptly  deliver to the holder of the Note, a
certificate  signed by the President or a Vice President and by the Treasurer or
an Assistant  Treasurer or the  Secretary or an Assistant  Secretary of Borrower
setting forth in reasonable  detail the event  requiring the  adjustment and the
method by which such  adjustment  was  calculated  and specifying the Conversion
Price then in effect  following  such  adjustment and the increased or decreased
number of shares issuable upon the conversion  granted by this Section 10.1, and
shall set forth in  reasonable  detail the method of  calculation  of each and a
brief statement of the facts requiring such adjustment.

         (j) If any event occurs as to which the  foregoing  provisions  of this
Section 10.01 are not strictly applicable or, if strictly applicable, would not,
in the good faith judgment of the Board of Directors of the Borrower, fairly and
adequately protect the conversion rights of the Holder of the Note in accordance
with the essential intent and principles of such  provisions,  then the Board of
Directors of the Borrower shall make such adjustments in the application of such
provisions, in accordance with such essential intent and principles, as shall be
reasonably  necessary,  in the good faith  opinion of such Board of Directors of
the  Borrower,  to protect such purchase  rights as  aforesaid,  but in no event
shall any such adjustment have the effect of increasing the Conversion  Price or
decreasing  the  number of  shares of the UTC  Common  Stock  issuable  upon the
conversion of the Note.

         (k)  Notwithstanding  any issuance of a Conversion  Notice, at any time
prior to the Pricing Date,  the Borrower shall have the option to repay the Loan
together with any interest theretofore accrued and unpaid (including  additional
interest  under Section  1.05(b)).  Such payment must be received in full by the
Lender prior to the Pricing Date and otherwise in  accordance  with the terms of
the Credit  Documents.  From and after the Pricing  Date,  the  Borrower may not
repay that portion of the Loan that is being converted  pursuant to this Section
10.01.

         (l) Any shares of UTC Common  Stock issued  pursuant to this  Agreement
(including  this  Section  10.01 and Section  1.05(b))  shall be entitled to the
benefit of the Registration Rights Agreement.

         SECTION 11. Miscellaneous.

         11.01 Payment of Expenses,  etc. The Borrower shall: (i) whether or not
the  transactions  herein  contemplated  are  consummated,  pay  all  reasonable
out-of-pocket  costs and expenses of the Lender (including,  without limitation,
the reasonable  fees and  disbursements  of White & Case LLP and of the Lender's
consultants) in connection with any refinancing or  restructuring  of the credit
arrangements  provided  under this  Agreement in the nature of a  "work-out"  or
pursuant to any insolvency or bankruptcy  proceedings  (including,  in each case
without

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<PAGE>
limitation, the reasonable fees and disbursements of counsel and consultants for
the Lender);  (ii) pay and hold the Lender harmless from and against any and all
present  and future  stamp,  excise  and other  similar  documentary  taxes with
respect to the foregoing  matters and save the Lender  harmless from and against
any and all liabilities  with respect to or resulting from any delay or omission
(other than to the extent  attributable  to the  Lender) to pay such taxes;  and
(iii)  indemnify  the Lender,  and each of its officers,  directors,  employees,
representatives,  agents, affiliates,  trustees and investment advisors from and
hold  each of  them  harmless  against  any  and  all  liabilities,  obligations
(including removal or remedial actions),  losses,  damages,  penalties,  claims,
actions,   judgments,   suits,  costs,  expenses  and  disbursements  (including
reasonable  attorneys' and  consultants'  fees and  disbursements)  incurred by,
imposed on or assessed against any of them as a result of, or arising out of, or
in any way related  to, or by reason of, (a) any  investigation,  litigation  or
other  proceeding  (whether or not the Lender is a party  thereto and whether or
not such  investigation,  litigation  or other  proceeding  is  brought by or on
behalf of any Credit Party)  related to the entering into and/or  performance of
this  Agreement or any other  Credit  Document or the use of the proceeds of the
Loan hereunder or the consummation of the Transaction or any other  transactions
contemplated  herein or in any other  Credit  Document or the exercise of any of
their rights or remedies  provided herein or in the other Credit  Documents,  or
(b) the actual or alleged  presence of Hazardous  Materials in the air,  surface
water or groundwater or on the surface or subsurface of any Real Property owned,
leased or at any time operated by the Borrower or any of its  Subsidiaries,  the
generation, storage, transportation, handling or disposal of Hazardous Materials
by the  Borrower  or any of its  Subsidiaries  at any  location,  whether or not
owned,  leased or  operated  by the  Borrower  or any of its  Subsidiaries,  the
non-compliance of any Real Property with foreign, federal, state and local laws,
regulations, and ordinances (including applicable permits thereunder) applicable
to any Real Property,  or any Environmental Claim asserted against the Borrower,
any of its  Subsidiaries  or any  Real  Property  owned,  leased  or at any time
operated by the Borrower or any of its  Subsidiaries,  including,  in each case,
without  limitation,  the reasonable fees and disbursements of counsel and other
consultants  incurred in connection with any such  investigation,  litigation or
other  proceeding  (but excluding any losses,  liabilities,  claims,  damages or
expenses  to the extent  incurred by reason of the gross  negligence  or willful
misconduct  of the  Person  to be  indemnified  (as  determined  by a  court  of
competent jurisdiction in a final and non-appealable  decision)).  To the extent
that the undertaking to indemnify,  pay or hold harmless the Lender set forth in
the preceding  sentence may be unenforceable  because it is violative of any law
or public  policy,  the  Borrower  shall make the  maximum  contribution  to the
payment  and  satisfaction  of  each of the  indemnified  liabilities  which  is
permissible under applicable law.

         11.02  Right of Setoff.  In  addition  to any  rights now or  hereafter
granted under  applicable law or otherwise,  and not by way of limitation of any
such  rights,  upon the  occurrence  and during the  continuance  of an Event of
Default,  the  Lender  is  hereby  authorized  at any time or from time to time,
without presentment,  demand,  protest or other notice of any kind to any Credit
Party or to any other Person,  any such notice being hereby expressly waived, to
set off and to appropriate  and apply any and all deposits  (general or special)
and any other Indebtedness at any time held or owing by the Lender to or for the
credit  or the  account  of any  Credit  Party  against  and on  account  of the
Obligations  and  liabilities  of the Credit  Parties  to the Lender  under this
Agreement  or under any of the other Credit  Documents,  and all other claims of
any nature or

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<PAGE>
description  arising out of or connected with this Agreement or any other Credit
Document,  irrespective  of whether or not the Lender shall have made any demand
hereunder and although said Obligations,  liabilities or claims, or any of them,
shall be contingent or unmatured.

         11.03  Notices.  Except as otherwise  expressly  provided  herein,  all
notices and other  communications  provided  for  hereunder  shall be in writing
(including  telegraphic,  telex,  telecopier or cable communication) and mailed,
telegraphed,  telexed, telecopied,  cabled or delivered: if to any Credit Party,
at the address  specified  opposite its signature below or in the other relevant
Credit Documents; if to the Lender, at its address specified on Schedule II; or,
as to any Credit  Party,  at such other  address as shall be  designated by such
party in a written  notice to the other  parties  hereto.  All such  notices and
communications shall, when mailed, telegraphed,  telexed,  telecopied, or cabled
or  sent by  overnight  courier,  be  effective  when  deposited  in the  mails,
delivered to the telegraph company,  cable company or overnight courier,  as the
case  may  be,  or  sent  by  telex  or  telecopier,  except  that  notices  and
communications  to the  Lender and the  Borrower  shall not be  effective  until
received by the Lender or the Borrower, as the case may be.

         11.04  Benefit  of  Agreement;  Assignments;  Participations.  (a) This
Agreement  shall be binding upon and inure to the benefit of and be  enforceable
by the  respective  successors  and  assigns of the  parties  hereto;  provided,
however, the Borrower may not assign or transfer any of its rights,  obligations
or  interest  hereunder  without  the prior  written  consent of the Lender and,
provided  further,  that,  although  the  Lender may  transfer,  assign or grant
participations in its rights  hereunder,  the Lender shall remain a "Lender" for
all purposes hereunder and the transferee,  assignee or participant, as the case
may be,  shall not  constitute  a  "Lender"  hereunder.  In the case of any such
participation, the participant shall not have any rights under this Agreement or
any of the other Credit Documents (the  participant's  rights against the Lender
in respect of such participation to be those set forth in the agreement executed
by the Lender in favor of the  participant  relating  thereto)  and all  amounts
payable by the Borrower  hereunder  shall be determined as if the Lender had not
sold such participation.

         (b) Notwithstanding  the foregoing,  the Lender may (x) assign all or a
portion of its outstanding  Obligations hereunder to any affiliate of the Lender
which is at least 50% owned by the Lender or its parent company,  provided that,
(i) at such time Schedule I shall be deemed  modified to reflect the outstanding
Loan of such new Lender and of the existing Lender,  and (ii) upon the surrender
of  the  Note  by  the  assigning  Lender  (or,  upon  such  assigning  Lender's
indemnifying   the  Borrower   for  the  lost  Note   pursuant  to  a  customary
indemnification  agreement) new Notes will be issued, at the Borrower's expense,
to such new  Lender and to the  assigning  Lender  upon the  request of such new
Lender  or  assigning  Lender,  such  new  Notes  to be in  conformity  with the
requirements  of Section  1.05 (with  appropriate  modifications)  to the extent
needed to reflect the revised  outstanding Loan. To the extent of any assignment
pursuant to this Section 11.04(b), the assigning Lender shall be relieved of its
obligations  hereunder with respect to its assigned  outstanding  Loan.

         11.05 No Waiver;  Remedies Cumulative.  No failure or delay on the part
of the Lender in exercising any right, power or privilege hereunder or under any
other Credit Document and no course of dealing between the Borrower or any other
Credit Party and the Lender  shall  operate as a waiver  thereof;  nor shall any
single or partial exercise of any right,  power or privilege

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<PAGE>
hereunder  or under any other  Credit  Document  preclude  any other or  further
exercise  thereof  or the  exercise  of any  other  right,  power  or  privilege
hereunder or thereunder.  The rights, powers and remedies herein or in any other
Credit  Document  expressly  provided are  cumulative  and not  exclusive of any
rights,  powers or remedies which the Lender would  otherwise have. No notice to
or demand on any Credit Party in any case shall  entitle any Credit Party to any
other  or  further  notice  or  demand  in  similar  or other  circumstances  or
constitute  a waiver of the rights of the Lender to any other or further  action
in any circumstances without notice or demand.

         11.06 Calculations;  Computations;  Adjustments;  Accounting Terms. (a)
The financial  statements to be furnished to the Lender pursuant hereto shall be
made and prepared in accordance with generally accepted accounting principles in
the United States  consistently  applied throughout the periods involved (except
as set forth in the notes  thereto or as  otherwise  disclosed in writing by the
Borrower to the Lender).

         (b) All  computations of interest  hereunder shall be made on the basis
of a year of 360 days for the actual number of days  occurring in the period for
which such interest is payable.

         (c) At all times, the rate of interest to be paid hereunder (including,
without limitation,  any additional interest payable pursuant to Section 1.05(b)
shall  be the  lesser  of (x) the  highest  rate  of  interest  provided  for in
accordance with the terms  hereunder,  and (y) the maximum  permissible  rate of
interest provided for under applicable laws.

         11.07 GOVERNING LAW; SUBMISSION TO JURISDICTION;  VENUE; WAIVER OF JURY
TRIAL.  (a) THIS  AGREEMENT  AND THE OTHER CREDIT  DOCUMENTS  AND THE RIGHTS AND
OBLIGATIONS  OF THE PARTIES  HEREUNDER  AND  THEREUNDER  SHALL BE  CONSTRUED  IN
ACCORDANCE  WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.  ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT
MAY BE BROUGHT  IN THE  COURTS OF THE STATE OF NEW YORK OR OF THE UNITED  STATES
FOR THE  SOUTHERN  DISTRICT  OF NEW YORK,  IN EACH CASE WHICH ARE LOCATED IN THE
CITY OF NEW YORK,  AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT OR ANY OTHER
CREDIT  DOCUMENT,  THE  BORROWER  HEREBY  IRREVOCABLY  ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,  THE JURISDICTION OF THE
AFORESAID COURTS. THE BORROWER HEREBY FURTHER  IRREVOCABLY WAIVES ANY CLAIM THAT
ANY SUCH COURTS LACK PERSONAL JURISDICTION OVER THE BORROWER,  AND AGREES NOT TO
PLEAD OR CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER CREDIT DOCUMENTS  BROUGHT IN ANY OF THE  AFOREMENTIONED  COURTS,  THAT
SUCH COURTS LACK PERSONAL  JURISDICTION OVER THE BORROWER.  THE BORROWER FURTHER
IRREVOCABLY  CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH  ACTION OR  PROCEEDING  BY THE  MAILING OF COPIES  THEREOF BY
REGISTERED OR CERTIFIED MAIL,  POSTAGE  PREPAID,  TO THE BORROWER AT ITS ADDRESS
SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS
AFTER

                                       59
<PAGE>
SUCH  MAILING.  THE BORROWER  HEREBY  IRREVOCABLY  WAIVES ANY  OBJECTION TO SUCH
SERVICE OF PROCESS  AND  FURTHER  IRREVOCABLY  WAIVES AND AGREES NOT TO PLEAD OR
CLAIM IN ANY ACTION OR PROCEEDING  COMMENCED HEREUNDER OR UNDER ANY OTHER CREDIT
DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE.  NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE LENDER TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL  PROCEEDINGS OR OTHERWISE  PROCEED AGAINST
THE BORROWER IN ANY OTHER JURISDICTION.

         (b) THE BORROWER HEREBY  IRREVOCABLY  WAIVES ANY OBJECTION WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID  ACTIONS OR
PROCEEDINGS  ARISING OUT OF OR IN  CONNECTION  WITH THIS  AGREEMENT OR ANY OTHER
CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY
FURTHER  IRREVOCABLY,  TO THE EXTENT  PERMITTED BY  APPLICABLE  LAW,  WAIVES AND
AGREES  NOT TO  PLEAD  OR CLAIM IN ANY  SUCH  COURT  THAT  ANY  SUCH  ACTION  OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

         (c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO A TRIAL BY JURY IN ANY ACTION,  PROCEEDING OR COUNTERCLAIM  ARISING OUT
OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.

         11.08  Counterparts.  This  Agreement  may be executed in any number of
counterparts and by the different parties hereto on separate counterparts,  each
of which when so executed and delivered  shall be an original,  but all of which
shall together  constitute one and the same  instrument.  A set of  counterparts
executed by all the parties  hereto  shall be lodged with the  Borrower  and the
Lender.

         11.09 Effectiveness.  This Agreement shall become effective on the date
(the "Closing  Date") on which (i) the Borrower and the Lender shall have signed
a counterpart hereof (whether the same or different counterparts) and shall have
delivered  the same to the  Lender at the  Notice  Office,  and (ii) each of the
conditions precedent set forth in Section 4 has been satisfied to the reasonable
satisfaction of the Lender or waived with the consent of the Lender.  The Lender
will give the Borrower  prompt  written  notice of the occurrence of the Closing
Date.

         11.10 Headings  Descriptive.  The headings of the several  sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.

         11.11  Amendment or Waiver;  etc.  Neither this Agreement nor any other
Credit  Document  nor any  terms  hereof  or  thereof  may be  changed,  waived,
discharged or terminated

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<PAGE>
unless such change, waiver, discharge or termination is in writing signed by the
respective Credit Parties party thereto and the Lender.

         11.12 Survival.  All indemnities  set forth herein  including,  without
limitation, in Sections 3.04 and 11.01 shall survive the execution, delivery and
termination  of this  Agreement and the Note and the making and repayment of the
Obligations.

         11.13  Domicile of Loan. The Lender may transfer and carry its Loan at,
to or for the  account of any office,  Subsidiary  or  Affiliate  of the Lender.
Notwithstanding  anything to the contrary contained herein, to the extent that a
transfer of the Loan pursuant to this Section  11.13 would,  at the time of such
transfer,  result in increased costs under Section 3.04 from those being charged
by the Lender prior to such  transfer,  then the Borrower shall not be obligated
to pay such increased costs (although the Borrower shall be obligated to pay any
other  increased  costs of the type described above resulting from changes after
the date of the respective transfer).

         11.14  Confidentiality.  (a) Subject to the provisions of clause (b) of
this Section 11.14,  the Lender agrees that it will use its  reasonable  efforts
not to disclose  without the prior  consent of the  Borrower  (other than to its
employees,  auditors,  advisors or counsel or to another Lender if the Lender or
the Lender's  holding or parent company in its sole  discretion  determines that
any such party  should have access to such  information,  provided  such Persons
shall be subject to the  provisions  of this Section 11.14 to the same extent as
such  Lender)  any  information  with  respect  to  the  Borrower  or any of its
Subsidiaries  which is now or in the future furnished pursuant to this Agreement
or any other  Credit  Document  and which is  designated  by the Borrower to the
Lender in writing as  confidential,  provided  that the Lender may  disclose any
such information (i) as has become generally  available to the public other than
by virtue of a breach of this  Section  11.14(a) by the  Lender,  (ii) as may be
required or appropriate in any report,  statement or testimony  submitted to any
municipal,  state  or  Federal  regulatory  body  having  or  claiming  to  have
jurisdiction  over such  Lender or to the Federal  Reserve  Board or the Federal
Deposit Insurance  Corporation or similar  organizations  (whether in the United
States  or  elsewhere)  or  their  successors,  (iii)  as  may  be  required  or
appropriate  in respect to any  summons or subpoena  or in  connection  with any
litigation,  (iv) in order to comply with any law,  order,  regulation or ruling
applicable to the Lender,  and (v) to any  prospective  or actual  transferee or
participant in connection with any contemplated transfer or participation of any
of the Note or Commitment or any interest  therein by the Lender,  provided that
such  prospective   transferee  or  participant   agrees  to  be  bound  by  the
confidentiality provisions contained in this Section 11.14.

         (b) The  Borrower  hereby  acknowledges  and agrees that the Lender may
share with any of its affiliates,  and such affiliates may share with the Lender
any information  related to the Borrower or any of its Subsidiaries  (including,
without   limitation,   any  non-public  customer   information   regarding  the
creditworthiness  of the Borrower and its  Subsidiaries),  provided such Persons
shall be subject to the  provisions  of this Section 11.14 to the same extent as
the Lender.

         11.15 Register.  The Borrower hereby  designates the Lender to serve as
the Borrower's  agent,  solely for purposes of this Section 11.15, to maintain a
register (the  "Register") on which it will record the  Commitment  from time to
time of the Lender,  the Loans made by the Lender and each  repayment in respect
of the principal amount of the Loan.  Failure

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<PAGE>
to make any such recordation, or any error in such recordation, shall not affect
the Borrower's obligations in respect of such Loans. With respect to the Lender,
the transfer of the Commitment of the Lender and the rights to the principal of,
and  interest  on,  the Loan  made  pursuant  to such  Commitment  shall  not be
effective  until such  transfer is recorded on the  Register  maintained  by the
Lender with respect to ownership of such  Commitment  and Loan and prior to such
recordation  all amounts owing to the transferor with respect to such Commitment
and Loan shall remain owing to the transferor. The registration of assignment or
transfer  of all or part of any  Commitment  and Loan shall be  recorded  by the
Lender on the  Register  only upon the  acceptance  by the  Lender of a properly
executed and delivered assignment and assumption agreement in form and substance
satisfactory  to the Lender.  Coincident with the delivery of such an assignment
and  assumption  agreement  to the Lender for  acceptance  and  registration  of
assignment  or  transfer  of all or  part of a Loan,  or as soon  thereafter  as
practicable,  the  assigning or transferor  Lender shall  surrender the Note (if
any)  evidencing  the  Loan,  and  thereupon  one or more new  Notes in the same
aggregate principal amount shall be issued to the assigning or transferor Lender
and/or the new Lender at the request of any such Lender.  The Borrower agrees to
indemnify  the Lender from and against any and all losses,  claims,  damages and
liabilities of whatsoever  nature which may be imposed on,  asserted  against or
incurred by the Lender in performing its duties under this Section 11.15.

                                      * * *

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<PAGE>
         IN  WITNESS  WHEREOF,   the  parties  hereto  have  caused  their  duly
authorized  officers to execute and deliver this  Agreement as of the date first
above written.

Address:

2 North Tamiami Trail, Suite 900         UNIROYAL TECHNOLOGY CORPORATION
Sarasota, FL  34236
Attn:  George J. Zulanas, Jr.
Telephone No.:  (941) 361-2220           By/s/George J. Zulanas Jr.
Telecopier No.:  (941) 361-2214            ------------------------------------
                                           Title:  Executive Vice President,
                                                   Treasurer and Chief Financial
                                                   Officer

145 BELMONT DRIVE,                       EMCORE CORPORATION
SOMERSET, NEW JERSEY  08873
Attn: Mr Thomas Werthan
Telephone No.:  (732) 271-9090           By/s/Thomas Werthan
Telecopier No.:  (732) 271-9783            ------------------------------------
                                           Title:  Chief Financial Officer

<PAGE>
                                                                      SCHEDULE I

                                   COMMITMENTS

Lender                           Commitment

Emcore Corporation               $5,000,000.00

                            ----------------------
TOTAL:                           $5,000,000.00

<PAGE>
                                                                     SCHEDULE II

                                 LENDER ADDRESS

Lender                                               Address

EMCORE Corporation                                   145 BELMONT DRIVE,
                                                     SOMERSET, NEW JERSEY  08873
                                                     Attn:  Mr. Thomas Werthan
                                                     Tel. No.:  (732) 271-9090
                                                     Fax No.:  (732) 271-9783

<PAGE>
                                                                    SCHEDULE III

                                      PLANS

1. Uniroyal Technology Corporation Savings Plan
2. Uniroyal Technology Corporation Savings Plan A
3. Uniroyal Technology Corporation 401(k) Plan for Polycast Technology Wage
Employees, Stamford, Connecticut

                                      * * *

<PAGE>
                                                                     SCHEDULE IV

                                  REAL PROPERTY

Owned
None.

Leased

1. Location:      3401 Cragmont Drive, Tampa, Florida
Lessee:           Uniroyal Optoelectronics, LLC
Lessor:           ProLogis Trust, 207-D Kelsey Lane, Tampa, FL 33619
Term:             August 1, 1998 - July 31, 2008

2. Location:      22660 Executive Drive, Suite 101, Sterling, Virginia
Lessee:           Sterling Semiconductor, Inc.
Lessor:           ProLogis Trust, 5200 Eisenhower Avenue, Suite 200, Alexandria,
                  VA 22304
Term:             March 1, 2001 - February 28, 2006

3. Location:      575 Randy, Carol Stream, Illinois
Lessee:           NorLux Corp.
Lessor:           AC Investments, LLC, 231 S. Gary, Suite 101, Bloomingdale, IL
                  60108
Term:             August 1, 2000 - July 31, 2005

4. Location:      7 Commerce Drive, Danbury, Connecticut
Lessee:           Sterling Semiconductor, Inc.
Lessor:           Advanced Technology Materials, Inc.
Term:             Expires September 30, 2004 (pursuant to a sharing agreement)

                                      * * *

<PAGE>
                                                                      SCHEDULE V

                                  SUBSIDIARIES

1.       Uniroyal Technology Corporation (Delaware, Florida)

         A.       Each of the following are Wholly-Owned Subsidiaries of
                  Uniroyal Technology Corporation:

                  (i)      Uniroyal HPP Holdings, Inc. (Delaware)

                  (ii)     UnitechNJ, Inc. (Delaware, New Jersey)

                  (iii)    UnitechOH, Inc. (Ohio)

                  (iv)     Uniroyal Compound Semiconductors, Inc. (Delaware)
                           - fka Uniroyal Optoelectronics, Inc. (Delaware)
                           - fka Townsend Plastics, Inc. (Delaware)

                  (v)      BayPlas7, Inc. (Delaware)

                  (vi)     BayPlas3, Inc. (Delaware)

                  (vii)    High Performance Plastics, Inc. (Delaware)

                  (viii)   Uniroyal Optoelectronics Service Corporation
                           (Delaware) - fka Polycast Plastics Corporation
                           (Delaware)

                  (ix)     Sterling Semiconductor, Inc. (Delaware)
                           - fka BayPlas6, Inc. (Delaware)

                  (x)      Uniroyal Engineered Products, LLC (Delaware)

         B.       Each of the following is a non-Wholly-Owned Subsidiary of
                  Uniroyal Technology Corporation (the percentage ownership of
                  Uniroyal Technology Corporation in all of respective classes
                  of common stock (or membership interests, as the case may be)
                  of each Subsidiary is indicated in square brackets appearing
                  after the name thereof below):

                  (i)      Uniroyal Optoelectronics, LLC (Delaware) [64%]
                           (provided, however, that following the consummation
                           of the Sale, Uniroyal Technology Corporation shall
                           own 100%)

                  (ii)     Uniroyal Liability Management Company, Inc.
                           (Delaware) - fka ULC Corp.
<PAGE>
                                                                      Schedule V
                                                                          Page 2

                  (iii)    BayPlas2, Inc. (Delaware) [69%]

2.       Uniroyal HPP Holdings, Inc. (Delaware)
         The above entity has one Subsidiary:

                  High Performance Plastics, Inc.

3.       UnitechNJ, Inc. (Delaware, New Jersey)
         The above entity has no Subsidiaries.

4.       UnitechOH, Inc. (Ohio)
         The above entity has no Subsidiaries.

5.       Uniroyal Compound Semiconductors, Inc. (Delaware)
         - fka Uniroyal Optoelectronics, Inc. (Delaware)
         - fka Townsend Plastics, Inc. (Delaware)
         The above entity has four Subsidiaries:

                  Uniroyal Optoelectronics Service Corporation
                  NorLux Corp.
                  Sterling Semiconductor, Inc.
                  Uniroyal Optoelectronics, Inc.

6.       BayPlas7, Inc. (Delaware)
         The above entity has no Subsidiaries.

7.       BayPlas3, Inc. (Delaware)
         The above entity has no Subsidiaries.

8.       Uniroyal Liability Management Company, Inc. (Delaware)
         - fka ULC Corp.
         The above entity has one Subsidiary:

                  BayPlas2., Inc.

9.       High Performance Plastics, Inc. (Delaware)
         The above entity has no Subsidiaries.

10.      Uniroyal Optoelectronics Service Corporation (Delaware)
         - fka Polycast Plastics Corporation (Delaware)
         The above entity has no Subsidiaries.

11.      Uniroyal Optoelectronics, LLC (Delaware)
         The above entity has no Subsidiaries.
<PAGE>
                                                                      Schedule V
                                                                          Page 3

12.      Sterling Semiconductor, Inc. (Delaware)
         - fka BayPlas6, Inc. (Delaware)
         The above entity has no Subsidiaries.

13.      Uniroyal Engineered Products, LLC (Delaware)
         The above entity has no Subsidiaries.

14.      BayPlas2, Inc. (Delaware)
         The above entity has no Subsidiaries.

                                      * * *

<PAGE>
                                                                     SCHEDULE VI

                              EXISTING INDEBTEDNESS

See attached Schedule.

<PAGE>
                                                                    SCHEDULE VII

                                    INSURANCE

See attached Summary of Insurance and Certificates.

<PAGE>
                                                                   SCHEDULE VIII

                                 EXISTING LIENS

See attached Lien Schedule.

<PAGE>
                                                                     SCHEDULE IX

                              EXISTING INVESTMENTS

None.

<PAGE>
                                                                      SCHEDULE X

                            [Intentionally Omitted].

<PAGE>
                                                                     SCHEDULE XI

                         EXISTING AFFILIATE TRANSACTIONS

None.

<PAGE>
                                                                   SCHEDULE 4.07

                              ADVERSE CHANGE, ETC.

1.       As of October 1, 2000, the Borrower and its Subsidiaries held
         $57,952,000 in cash and Cash Equivalents and short and long term
         investments, whereas as of July 1, 2001, the Borrower and its
         Subsidiaries held $9,154,000 in cash and Cash Equivalents and short and
         long term investments; and

2.       For the fiscal year ended October 1, 2000, the consolidated loss from
         continuing operations of the Borrower and its Subsidiaries was
         $10,659,000, whereas for the period commencing after the fiscal year
         last ended up to and including July 1, 2001, the consolidated loss from
         continuing operations of the Borrower and its Subsidiaries was
         $17,768,000.

<PAGE>

                                                                       EXHIBIT A

                           FORM OF NOTICE OF BORROWING

                                                               August ____, 2001

EMCORE Corporation
    as  Lender party
    to the Credit Agreement
    referred to below
145 Belmont Drive
Somerset, New Jersey, 08873

Attention:  Mr Thomas Werthan

Ladies and Gentlemen:

         The undersigned,  Uniroyal  Technology  Corporation  (the  "Borrower"),
refers  to the  Credit  Agreement,  dated as of  August  __,  2001 (as  amended,
modified or  supplemented  from time to time, the "Credit  Agreement," the terms
defined  therein being used herein as therein  defined),  among the Borrower and
you, as Lender,  and hereby gives you notice,  irrevocably,  pursuant to Section
1.02 of the Credit Agreement, that the undersigned hereby requests the Borrowing
of the Loan under the Credit Agreement,  and in that connection sets forth below
the information relating to the Borrowing (the "Proposed Borrowing") as required
by Section 1.02 of the Credit Agreement:

         (i) The Business Day of the Proposed Borrowing is ____________.1

         (ii) The  aggregate  principal  amount  of the  Proposed  Borrowing  is
    $____________.

         The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing:

         (A)  the  representations  and  warranties   contained  in  the  Credit
Agreement and in the other Credit  Documents are and will be true and correct in
all  material  respects,  both before and after  giving  effect to the  Proposed
Borrowing and to the application of the proceeds thereof, as though made on such
date,  unless  stated to relate to a specific  earlier  date, in which case such
representations  and  warranties  shall  be true  and  correct  in all  material
respects as of such earlier date; and

----------------------
1     Any such  notice  shall be deemed to have been given on a certain day only
      if given before 11:00 A.M. (New York time) on such day.
<PAGE>
                                                                       Exhibit A
                                                                          Page 2

         (B) no Default or Event of Default has occurred and is  continuing,  or
would  result  from  such  Proposed  Borrowing  or from the  application  of the
proceeds thereof.

                                             Very truly yours,

                                             UNIROYAL TECHNOLOGY CORPORATION

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

<PAGE>
                                                                       EXHIBIT B

                                  FORM OF NOTE

$________                                                     New York, New York
                                                                August ___, 2001

FOR VALUE RECEIVED, UNIROYAL TECHNOLOGY CORPORATION, a Delaware corporation (the
"Borrower"),  hereby promises to pay to  ____________ or its registered  assigns
(the  "Lender"),  in lawful money of the United States of America in immediately
available  funds,  at the office of EMCORE  Corporation  located at 145  Belmont
Drive,  Somerset,  New Jersey,  08873, on the Final Maturity Date (as defined in
the Credit  Agreement  referred  to below) the  principal  sum of  _____________
DOLLARS  ($_____)  or,  if less,  the  unpaid  principal  amount of the Loan (as
defined  in the Credit  Agreement)  made by the  Lender  pursuant  to the Credit
Agreement.

         The  Borrower  promises  also to pay  interest on the unpaid  principal
amount  hereof in like money at said office  from the date hereof  until paid at
the rates and at the times provided in Section 1.05 of the Credit Agreement.

         This Note is the Note referred to in the Credit Agreement,  dated as of
August __, 2001,  among the  Borrower  and the Lender (as  amended,  modified or
supplemented  from time to time, the "Credit  Agreement") and is entitled to the
benefits  thereof and of the other  Credit  Documents  (as defined in the Credit
Agreement).  This Note is secured by the Security  Documents  (as defined in the
Credit  Agreement) and is entitled to the benefits of the Subsidiaries  Guaranty
(as  defined  in the  Credit  Agreement).  This  Note is  subject  to  voluntary
prepayment and mandatory repayment prior to the Final Maturity Date, in whole or
in part, as provided in the Credit Agreement.

         If an Event of Default (as defined in the Credit Agreement) shall occur
and be continuing, the principal of and accrued interest on this Note may become
or be declared to be due and payable in the manner and with the effect  provided
in the Credit Agreement.

         The Borrower hereby waives  presentment,  demand,  protest or notice of
any kind in connection with this Note.

<PAGE>
                                                                       Exhibit B
                                                                          Page 2

         THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE  WITH AND BE GOVERNED BY THE
LAW OF THE STATE OF NEW YORK.

                                             UNIROYAL TECHNOLOGY CORPORATION

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

<PAGE>
                                                                       EXHIBIT C

                         UNIROYAL TECHNOLOGY CORPORATION
                                    SUITE 900
                             TWO NORTH TAMIAMI TRAIL
                             SARASOTA, FLORIDA 34236

OLIVER J. JANNEY                                  Telephone:  (941) 361-2212
EXECUTIVE VICE PRESIDENT,                         Fax:  (941) 361-2214
GENERAL COUNSEL & SECRETARY                       oliver.janney@uniroyaltech.com

                                                                  August 2, 2001

To the Lender party to the Credit
    Agreement referred to below:

Ladies and Gentlemen:

     I am issuing this opinion letter in my capacity as general legal counsel to
Uniroyal Technology Corporation,  a Delaware corporation (the "Borrower") and to
Uniroyal  Optoelectronics  Service Corporation,  a Delaware corporation,  NorLux
Corp., a Delaware corporation, Uniroyal Optoelectronics, LLC, a Delaware limited
liability  company  ("UOE")  and  Sterling   Semiconductor,   Inc.,  a  Delaware
corporation (each a "Subsidiary"  and, together with the Borrower,  collectively
referred to herein as the "Credit  Parties") in response to the  requirement  in
Section 4.03 of the Credit Agreement (the "Credit  Agreement"),  dated as of the
date hereof,  by and among the Borrower and EMCORE  Corporation,  as Lender (the
"Lender")  (the  Lender  being  herein  called  "you").  The  term  "Transaction
Documents" whenever it is used in this letter means the Credit Agreement and the
following  additional  documents as in effect on the date hereof:  (a) the Note,
(b)  the  Security  Agreement,  (c)  Control  Agreement,  (d)  the  Subsidiaries
Guaranty,  and (e) the Uniform Commercial Code financing statements (form UCC-1)
in the form attached hereto as Annex I (the "Financing Statements").  Items (a),
(b), (c), (d) and the Credit  Agreement are  collectively  referred to herein as
the "Credit  Documents".  Unless  otherwise  indicated,  capitalized  terms used
herein but not otherwise  defined herein have the respective  meanings set forth
in the Credit Agreement.

          In  rendering  the  opinions  set forth  below,  I have  examined  and
reviewed copies of the following documents:

          (i) the incorporation documents of each of the Credit Parties,

          (ii) the by-laws or other constituent  documents of each of the Credit
Parties,

          (iii) all minutes of the  shareholders  and the board of  directors or
the board of managers, as the case may be, of each of the Credit Parties, and

<PAGE>

          (iv) the Credit Documents,  the Financing  Statements and all exhibits
and  schedules  attached  thereto  and all other  documents  delivered  pursuant
thereto or in connection therewith.

          I have also  examined  such other  records and documents and made such
other  investigations of law and fact as I have deemed necessary or advisable in
order to express the following opinions.

          Subject  to the  foregoing  and to  the  assumptions,  qualifications,
exclusions and other  limitations  which are identified in this letter, I advise
you,  and with respect to each legal issue  addressed  in this letter,  it is my
opinion, that:

          1. (i) Each of the Credit  Parties  (other than UOE) is a  corporation
     existing and in good standing under the laws of the State of Delaware, (ii)
     UOE is a limited  liability company existing and in good standing under the
     laws of the State of Delaware and (iii) each of the Credit  Parties has the
     corporate power, or limited liability company power, as applicable,  to own
     its property and assets of which I am aware and to transact the business in
     which, to my knowledge, it is engaged or presently proposes to engage.

          2. Each Credit Party has the  corporate  power,  or limited  liability
     company power,  as applicable,  to enter into the Credit  Documents and the
     Financing  Statements to which it is a party and to perform its obligations
     under each such Credit Document.

          3. Each Credit  Party's Board of Directors (in the case of UOE,  Board
     of Managers) has duly authorized the execution, delivery and performance by
     such Credit Party of the Credit  Documents and the Financing  Statements to
     which it is a party and no other  corporate  action,  or limited  liability
     company action, as applicable, on the part of such Credit Party is required
     in  connection  with the  authorization  of such  execution,  delivery  and
     performance of such Credit Documents and the Financing Statements.

          4. Each  Credit  Party has duly  executed  and  delivered  the  Credit
     Documents and the Financing Statements to which it is a party.

          5. Each of the Credit Documents and the Financing  Statements to which
     any  Credit  Party is a party is a valid  and  binding  obligation  of such
     Credit Party and is  enforceable  against  such Credit Party in  accordance
     with its  terms,  as the same may be  limited  by  bankruptcy,  insolvency,
     reorganization  or similar  laws  affecting  the  enforcement  of rights of
     creditors  generally,  (b) as the same may be limited by general principles
     of equity,  and (c) that a remedy of specific  performance  and  injunctive
     relief and other forms of relief may be subject to  equitable  defenses and
     to the discretion of the court before which any proceedings may be brought.

          6.  The  execution  and  delivery  of the  Credit  Documents  and  the
     Financing   Statements  and   performance  by  each  Credit  Party  of  its
     obligations,   if  any,  under  the  Credit  Documents  and  the  Financing
     Statements  to which  it is a party,  will  not (a)  violate

                                       2

<PAGE>

     any   existing   provisions   of  such  Credit   Party's   Certificate   of
     Incorporation,  Bylaws or other  constituent  documents,  (b)  constitute a
     violation  by such Credit  Party of any  applicable  provision  of existing
     statutory  law or  governmental  regulation  covered  by this  letter,  (c)
     violate any existing order,  writ,  injunction or decree applicable to such
     Subsidiary of any court or governmental instrumentality or (d) constitute a
     violation or a breach under the  Transaction  Documents or (e) constitute a
     violation or breach under any agreement to which the Borrower or any of its
     Subsidiaries is a party to as of the Closing Date.

          7.  There  are  no   actions,   suits  or   proceedings   (private  or
     governmental)  pending or threatened (i) with respect to the Transaction or
     any Document or (ii) that, either  individually or in the aggregate,  could
     reasonably be expected to have a material  adverse  effect on the business,
     property,  assets,  liabilities  (actual  or  contingent),   operations  or
     condition  (financial or  otherwise)  of the Borrower and its  Subsidiaries
     taken as a whole.

          8. No  Credit  Party is  presently  required  to obtain  any  consent,
     approval,  authorization  or order of any court or  governmental  agency in
     order to obtain the right to enter into any of the Credit Documents and the
     Financing  Statements or to take any of the actions,  if any, taken by such
     Credit  Party in  connection  with  the  consummation  of the  transactions
     contemplated by the Credit Documents and the Financing  Statements,  except
     for:  (a) those  obtained or made on or prior to the date  hereof,  (b) any
     actions  or filings to perfect  the liens and  security  interests  granted
     under the Credit  Documents,  (c) actions or filings required in connection
     with  ordinary  course  conduct by such Credit  Party of its  business  and
     ownership or operation by such Credit Party of its assets,  and (d) actions
     and filings  required  under any  provision  of any law or  regulation  not
     covered by this opinion.

          9. The Security  Agreement  creates in favor of the Lender for its own
     account, as security for the payment of the secured  obligations  described
     therein,  a valid security  interest in the Collateral  described  therein;
     provided,  further,  without  limiting the foregoing except with respect to
     Collateral  consisting of the deposit  accounts,  the Control Agreement and
     the Security  Agreement  are  effective to create a valid  perfected  first
     priority  security  interest in the  Collateral  consisting of the deposits
     accounts.  There is no adverse claim to the Collateral Account, the deposit
     accounts of any Credit Party or any funds respectively deposited therein.

          10. I have examined the Financing Statements to be filed in the filing
     offices  in the State of  Delaware  and the State of Florida  (the  "Filing
     Offices"),  and upon the filing of such Financing  Statements in the Filing
     Offices, all filings, registrations and recordings necessary or appropriate
     to create, maintain,  preserve,  protect and perfect the security interests
     granted by each Credit Party to the Lender under the Security  Agreement in
     respect of all the Collateral  thereunder will have been  accomplished  and
     the  security  interests  granted to the Lender  pursuant  to the  Security
     Agreement in and to such

                                       3

<PAGE>

     Collateral will constitute a perfected  security  interest  therein in each
     case to the extent that such Collateral consists of the type of property in
     which a security interest may be perfected by filing a financing  statement
     under the Uniform  Commercial  Code (the "UCC") as in effect in each of the
     States of the  United  States of America  as of the date  hereof.  The only
     filings  of UCC  financing  statements  required  to protect  the  security
     interests granted therein are the filings being made in the jurisdiction of
     organization of the respective Credit Party.

          11. No Credit Party is an "investment  company"  within the meaning of
     the Investment Company Act of 1940, as amended.

          12. No Credit Party is a "holding company," or a "subsidiary  company"
     of a "holding  company," or an "affiliate"  of a "holding  company" or of a
     "subsidiary  company"  of a "holding  company"  within  the  meaning of the
     Public Utility Holding Company Act of 1935, as amended.

          13. To the best of my  knowledge  (based  solely  upon lien  searches,
     inquiries of officers of the Credit Parties and the  certificates  executed
     and  delivered to me by officers of the Credit  Parties),  (i) there are no
     actions,  suits or  proceedings  pending or threatened  against such Credit
     Parties with  respect to any of the  Transaction  Documents  and (ii) there
     does not exist any judgment,  order or injunction  prohibiting  or imposing
     any material adverse condition upon the consummation of the Transaction.

          14. The shares of equity  securities  to be issued upon  conversion of
     the Note pursuant to Section 10 of the Credit  Agreement  (the  "Conversion
     Shares")  have been duly  authorized  and validly  reserved for issuance in
     contemplation  of  conversion of the Note and, when issued and delivered in
     accordance  with the Note,  will have been validly  issued,  fully paid and
     non-assessable.  The Lender will acquire good and  marketable  title to the
     Conversion Shares upon conversion of the Note in accordance with Section 10
     of the Credit Agreement,  free and clear of any and all Liens,  except such
     Liens as may exist under the Credit Documents.  The initial issuance of the
     Conversion Shares in accordance with the terms of the Credit Documents will
     be exempt from the requirements  for registration  under the Securities Act
     of 1933, as amended.

          My advice  on every  legal  issue  addressed  in this  letter is based
exclusively on the internal laws of New York and Florida,  the Delaware  General
Corporation Law and the Delaware  Limited  Liability  Company Act or the federal
law of the United States. The advice expressed herein as to the Delaware Uniform
Commercial  Code shall be deemed correct under Delaware law if such advice would
have been  correct  under New York or  Florida  law.  I advise  you that  issues
addressed by this letter may be governed in whole or in part by other laws,  but
I express no opinion as to whether any relevant  difference  exists  between the
laws upon which my  opinions  are based and any other  laws  which may  actually
govern.

                                      * * *

                                       4

<PAGE>

          This  letter  speaks  as of the  time of its  delivery  on the date it
bears.  The advice set forth herein is expressed solely for your benefit and may
not be relied  upon by any other  person or  entity,  or for any other  purpose,
without my prior written consent.

                                                   Very truly yours,

                                                   By:
                                                      ---------------------
                                                      Mr Oliver J. Janney

                                       5

<PAGE>
                                                                       EXHIBIT D

                          FORM OF OFFICERS' CERTIFICATE

         I, the undersigned, [Chairman of the Board/President/Vice President] of
[Name of Credit Party],  a corporation  organized and existing under the laws of
the  State of  Delaware  (the  "Company"),  do hereby  certify  on behalf of the
Company that:

         1. This  Certificate  is  furnished  pursuant  to  Section[s  4.02 and]
4.04(a) of the Credit  Agreement,  dated as of August __, 2001,  among [Uniroyal
Technology  Corporation] [the Company], and EMCORE Corporation,  as Lender (such
Credit  Agreement,  as in effect on the date of this  Certificate,  being herein
called the "Credit  Agreement").  Unless otherwise  defined herein,  capitalized
terms used in this  Certificate  shall have the meanings set forth in the Credit
Agreement.

         2. The following named individuals are elected officers of the Company,
each holds the office of the Company set forth  opposite his or her name and has
held such office since January 1, 2001. The signature  written opposite the name
and title of each such officer is his or her genuine signature.

    Name2                             Office                         Signature

--------------                      -----------                    -------------

--------------                      -----------                    -------------

--------------                      -----------                    -------------

         3. Attached hereto as Exhibit A is a certified copy of the [Certificate
of Incorporation]  [Articles of  Incorporation] of the Company,  as filed in the
Office of the  Secretary  of State of the  State of  _________  on  ___________,
[19/20]__, together with all amendments thereto adopted through the date hereof.

         4.  Attached  hereto  as  Exhibit B is a true and  correct  copy of the
ByLaws of the Company which were duly  adopted,  are in full force and effect on
the date hereof, and have been in effect since _____________, [19/20]__.

         5.  Attached  hereto  as  Exhibit  C is a  true  and  correct  copy  of
resolutions which were duly adopted on __________, [19/20]__ by a meeting of the
Board of  Directors  of the  Company  at which a quorum was  present  and acting
throughout,  and said resolutions have not been rescinded,  amended or modified.
Except as attached hereto as Exhibit C, no resolutions  have been adopted by the
Board of Directors  of the Company  which deal with the  execution,  delivery or
performance of any of the Documents to which the Company is party.

         [6. On the date hereof,  all of the applicable  conditions set forth in
Sections 4.06, 4.07, 4.08 and 4.16 of the Credit Agreement have been satisfied.

         7. Attached hereto as Exhibit D are true and correct copies of all Sale
Documents.

-----------------------
2   Include name, office and signature of each officer who will sign any Credit
    Document, including the officer who will sign the certification at the end
    of this Certificate or related documentation.
<PAGE>
                                                                       Exhibit D
                                                                          Page 2

         8.  Attached  hereto as  Exhibit H are true and  correct  copies of all
Plans.

         9.  Attached  hereto as  Exhibit I are true and  correct  copies of all
Shareholders' Agreements.

         10.  Attached  hereto as Exhibit J are true and  correct  copies of all
Management Agreements.

         11.  Attached  hereto as Exhibit K are true and  correct  copies of all
Employment Agreements.

         12.  Attached  hereto as Exhibit L are true and  correct  copies of all
Non-Compete Agreements.

         13.  Attached  hereto as Exhibit M are true and  correct  copies of all
Collective Bargaining Agreements.

         14. Attached hereto as Exhibit N are true and correct copies of all Tax
Sharing Agreements.

         15.  Attached  hereto as Exhibit O are true and  correct  copies of all
Existing Indebtedness Agreements.]3

         [6][16].  On  the  date  hereof,  the  representations  and  warranties
contained in the Credit Agreement and in the other Credit Documents are true and
correct with the same effect as though such  representations  and warranties had
been  made on the date  hereof,  both  before  and  after  giving  effect to the
incurrence  of Loans on the date  hereof  and the  application  of the  proceeds
thereof,  unless stated to relate to a specific earlier date, in which case such
representations and warranties were true and correct in all material respects as
of such earlier date.

         [7][17].  On the date  hereof,  no  Default  or Event  of  Default  has
occurred and is  continuing  or would result from the  Borrowing to occur on the
date hereof or from the application of the proceeds thereof.

         [8][18].  There is no proceeding for the  dissolution or liquidation of
the Company or threatening its existence.

         IN WITNESS WHEREOF,  I have hereunto set my hand this ____ day of ____,
2001.

                                             [Name of Credit Party]

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

--------------------
3     Insert  bracketed items 6 through 15 only in the Officers'  Certificate of
      the Borrower.
<PAGE>
                                                                       Exhibit D
                                                                          Page 3

         I, the  undersigned,  Secretary  of the Company,  do hereby  certify on
behalf of the Company that:

         1. [Name of Person making above certifications] is the duly elected and
qualified  [Chairman of the  Board/President/Vice  President] of the Company and
the signature above is his or her genuine signature.

         2.  The   certifications   made  by  [name  of  Person   making   above
certifications]  on behalf of the Company in Items 2, 3, 4, 5, and [8][18] above
are true and correct.

         IN WITNESS WHEREOF, I have hereunto set my hand this ____ day of _____,
2001.

                                             [Name of Credit Party]

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

<PAGE>
                                                                       EXHIBIT E

                               SECURITY AGREEMENT

                                      among

                       UNIROYAL TECHNOLOGY CORPORATION AND
            CERTAIN SUBSIDIARIES OF UNIROYAL TECHNOLOGY CORPORATION,
                         PARTY HERETO FROM TIME TO TIME

                                       and

                               EMcore Corporation,
                                   as ASSIGNEE

                        --------------------------------

                           Dated as of August 2, 2001
                        --------------------------------

<PAGE>

                               SECURITY AGREEMENT

          SECURITY  AGREEMENT,  dated as of August 2, 2001,  made by each of the
undersigned  assignors (each an "Assignor"  and,  together with any other entity
that  becomes an  assignor  hereunder  pursuant  to  Section  8.11  hereof,  the
"Assignors") in favor of EMCORE Corporation,  as Assignee (the "Assignee"),  for
its own benefit.  Except as otherwise defined herein, all capitalized terms used
herein and  defined in the Credit  Agreement  (as defined  below)  shall be used
herein as therein defined.

                              W I T N E S S E T H:
                               - - - - - - - - - -

          WHEREAS,  Uniroyal  Technology  Corporation,   as  Borrower,  and  the
Assignee, as Lender, have entered into a Credit Agreement, dated as of August 2,
2001 (as amended, modified, extended, renewed, replaced, restated,  supplemented
or refinanced  from time to time,  and  including  any  agreement  extending the
maturity of, or refinancing or restructuring (including, but not limited to, the
inclusion of additional  borrowers or  guarantors  thereunder or any increase in
the  amount  borrowed)  all or any  portion  of,  the  indebtedness  under  such
agreement or any successor agreement, the "Credit Agreement"), providing for the
making of the Loan to the Borrower as contemplated therein;

          WHEREAS,  it is a condition precedent to the making of the Loan to the
Borrower  under the Credit  Agreement that each Assignor shall have executed and
delivered to the Assignee this Agreement; and

          WHEREAS, each Assignor will obtain benefits from the incurrence of the
Loan by the Borrower under the Credit Agreement and, accordingly,  each Assignor
desires to enter into this Agreement in order to satisfy the condition described
in the preceding paragraph;

          NOW,  THEREFORE,  in  consideration  of the benefits  accruing to each
Assignor,  the receipt and  sufficiency of which are hereby  acknowledged,  each
Assignor  hereby  makes the  following  representations  and  warranties  to the
Assignee and hereby covenants and agrees with the Assignee as follows:

                                    ARTICLE I

                               SECURITY INTERESTS

          1.1. Grant of Security  Interests.  (a) As security for the prompt and
complete  payment  and  performance  when  due of all of its  Obligations,  each
Assignor  does hereby  assign and transfer  unto the  Assignee,  and does hereby
pledge and grant to the Assignee,  a continuing  security interest in all of the
right,  title and  interest  of such  Assignor  in,  to and under the  following
property of such  Assignor of,  whether now  existing or hereafter  from time to
time acquired or such other  property as may be specified in a schedule added to
this Agreement for a particular  Assignor:  (i) each and every Receivable,  (ii)
all  Inventory,  (iii) the  Equipment

<PAGE>

specified on Schedule 1 hereto,  (iv) all cash, (v) the  Collateral  Account and
all monies, securities,  instruments and other investments deposited or required
to be deposited in the Collateral Account, (vi) all other bank, demand, deposit,
time savings,  cash  management,  passbook,  certificates of deposit and similar
accounts maintained by such Assignor and all monies, securities, instruments and
other investments  deposited or required to be deposited in any of the foregoing
accounts,  and (vii) all Proceeds  and products of any and all of the  foregoing
(all of the above, collectively, the "Collateral").

          (b) The security interest of the Assignee under this Agreement extends
to all Collateral  which any Assignor may acquire at any time during the term of
this Agreement.

          (c) Notwithstanding anything to the contrary contained in this Section
1.1 or elsewhere in this Agreement,  each of the parties hereto acknowledges and
agrees that the security  interest  granted  pursuant to this Section 1.1 to the
Assignee for the benefit of Senior  Creditors  shall be a first priority  senior
security interest in the Collateral.

          1.2. Power of Attorney.  Each Assignor hereby constitutes and appoints
the Assignee its true and lawful  attorney,  irrevocably,  with full power after
the occurrence of and during the continuance of an Event of Default (in the name
of such Assignor or otherwise) to act, require,  demand,  receive,  compound and
give  acquaintance for any and all moneys and claims for moneys due or to become
due to such  Assignor  under or arising  out of the  Collateral,  to endorse any
checks or other  instruments  or orders in connection  therewith and to file any
claims or take any action or institute  any  proceedings  which the Assignee may
deem to be  necessary or  advisable  to protect the  interests of the  Assignee,
which appointment as attorney is coupled with an interest.

                                   ARTICLE II

                GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS

Each Assignor represents, warrants and covenants, which representations,
warranties and covenants shall survive execution and delivery of this Agreement,
as follows:

          2.1. Necessary  Filings.  All filings,  registrations,  recordings and
other  actions  necessary  or  appropriate  to create,  preserve and perfect the
security  interest granted by such Assignor to the Assignee hereby in respect of
the Collateral have been  accomplished and the security  interest granted to the
Assignee  pursuant to this Agreement in and to the  Collateral  creates a valid,
and together with all such filings, registrations, recordings and other actions,
a perfected  security  interest therein prior to the rights of all other Persons
therein  and  subject to no other  Liens  (other  than  Permitted  Liens) and is
entitled  to all the rights,  priorities  and  benefits  afforded by the Uniform
Commercial Code or other relevant law as enacted in any relevant jurisdiction to
perfected  security  interests,  in each case to the extent that the  Collateral
consists of the type of property in which a security  interest  may be perfected
by possession or control (within the meaning of the UCC as in effect on the date
hereof in the State of New  York),  by

<PAGE>

filing a financing statement under the Uniform Commercial Code as enacted in any
relevant jurisdiction.

          2.2. No Liens.  Such Assignor is, and as to Collateral  acquired by it
from time to time after the date hereof such  Assignor will be, the owner of all
Collateral free from any Lien,  security  interest,  encumbrance or other right,
title or interest of any Person (other than Permitted Liens),  and such Assignor
shall defend the Collateral against all claims and demands of all Persons at any
time claiming the same or any interest therein adverse to the Assignee.

          2.3. Other Financing  Statements.  As of the date hereof,  there is no
financing  statement (or similar  statement or instrument of registration  under
the law of any jurisdiction) covering or purporting to cover any interest of any
kind in the  Collateral  (other than  financing  statements  filed in respect of
Permitted  Liens),  and so long as the Termination  Date has not occurred,  such
Assignor  will not  execute or  authorize  to be filed in any public  office any
financing  statement (or similar  statement or instrument of registration  under
the law of any  jurisdiction) or statements  relating to the Collateral,  except
financing  statements  filed or to be  filed  in  respect  of and  covering  the
security  interests  granted  hereby  by such  Assignor  or in  connection  with
Permitted Liens.

          2.4. Chief Executive  Office,  Record  Locations.  The chief executive
office of such  Assignor is located at the address  indicated  on Annex A hereto
for such Assignor. Such Assignor will not move its chief executive office except
to such new location as such Assignor may establish in accordance  with the last
sentence of this Section 2.4. The  originals  of all  documents  evidencing  all
Receivables  of such Assignor and the only original books of account and records
of such  Assignor  relating  thereto are, and will  continue to be, kept at such
chief executive office, at one or more of the other locations set forth on Annex
A hereto or at such new  locations as such  Assignor may establish in accordance
with the last  sentence of this Section 2.4. All  Receivables  of such  Assignor
are,  and will  continue  to be,  maintained  at, and  controlled  and  directed
(including,  without  limitation,  for general  accounting  purposes)  from, the
office locations described above or such new location  established in accordance
with the last  sentence of this Section  2.4. No Assignor  shall  establish  new
locations  for such  offices  until (i) it shall have given to the  Assignee not
less than 15 days'  prior  written  notice of its  intention  to do so,  clearly
describing such new location and providing such other  information in connection
therewith as the Assignee may reasonably request,  and (ii) with respect to such
new  location,  it shall have taken all action  reasonably  satisfactory  to the
Assignee to maintain  the security  interest of the  Assignee in the  Collateral
intended to be granted hereby at all times fully perfected and in full force and
effect.

          2.5. Location of Inventory and Equipment.  All Inventory and Equipment
that constitutes  Collateral held on the date hereof by each Assignor is located
at one of the locations shown on Annex B hereto for such Assignor. To the extent
that any  Assignor  desires  to  establish  a new  location  for  Inventory  and
Equipment that constitutes  Collateral that is located in Alabama,  Connecticut,
Florida or Mississippi,  such Assignor only may do so if (i) it shall have given
to the Assignee not less than 15 days' prior written  notice of its intention so
to do, clearly describing such new location and providing such other information
in connection  therewith as

<PAGE>

the Assignee may reasonably request, and (ii) with respect to such new location,
it shall  have taken all  action  reasonably  satisfactory  to the  Assignee  to
maintain the security interest of the Assignee in the Collateral  intended to be
granted  hereby at all  times  fully  perfected  and in full  force and  effect;
provided,  however,  (x) from and after October 1, 2001,  the provisions of this
sentence  shall not be applicable if such new location is located in Connecticut
and (y) from and after January 1, 2002,  the  provisions of this sentence  shall
not be  applicable  if such new  location  is  located  in  Alabama,  Florida or
Mississippi.

          2.6. Legal Names;  Organizational  Identification Number; Trade Names;
Change of Name;  etc. The legal name of each  Assignor,  and the  organizational
identification number (if any) of each Assignor, is listed on Annex C hereto for
such Assignor.  No Assignor has or operates in any jurisdiction under, or in the
preceding  five years has had or has  operated in any  jurisdiction  under,  any
trade  names,  fictitious  names or other  names  except its legal name and such
other  trade or  fictitious  names  as are  listed  on  Annex C hereto  for such
Assignor. No Assignor shall change its legal name, organizational identification
number  (if any) or assume  or  operate  in any  jurisdiction  under any  trade,
fictitious  or other name except its legal name,  organizational  identification
number  and those  trade  names in each case  listed on Annex C hereto  for such
Assignor and those that may be  established in accordance  with the  immediately
succeeding sentence of this Section 2.6. No Assignor shall change its legal name
or organizational identification number or assume or operate in any jurisdiction
under any new trade,  fictitious  or other name until (i) it shall have given to
the Assignee not less than 15 days' prior written  notice of its intention so to
do, clearly  describing  such new name and the  jurisdictions  in which such new
name shall be used and providing such other information in connection  therewith
as the Assignee may reasonably request,  and (ii) with respect to such new name,
it shall have taken all action reasonably  requested by the Assignee to maintain
the security  interest of the Assignee in the Collateral  intended to be granted
hereby at all times fully  perfected and in full force and effect.  In addition,
to the extent that any Assignor does not have an  organizational  identification
number on the date hereof and later obtains one, such  Assignor  shall  promptly
thereafter notify the Assignee of such organizational  identification number and
shall take all actions  reasonably  satisfactory  to the  Assignee to the extent
necessary to maintain the  security  interest of the Assignee in the  Collateral
intended to be granted hereby fully perfected and in full force and effect.

          2.7.  Jurisdiction  and  Type of  Organization.  The  jurisdiction  of
organization of each Assignor, and the type of organization of each Assignor, is
listed  on Annex D hereto  for such  Assignor.  No  Assignor  shall  change  its
jurisdiction of organization or its type of organization until (i) it shall have
given to the Assignee not less than 15 days' prior  written  notice of intention
so to do, clearly  describing such new jurisdiction of organization  and/or type
of organization and providing such other information in connection  therewith as
the  Assignee  may  reasonably  request  and  (ii)  with  respect  to  such  new
jurisdiction of organization  and/or type of  organization,  it shall have taken
all actions  reasonably  requested  by the  Assignee to  maintain  the  security
interest of the Assignee in the Collateral  intended to be granted hereby at all
times fully perfected and in full force and effect.

<PAGE>

          2.8.  Collateral in the Possession of a Bailee. If any Inventory is at
any time in the possession of a bailee,  the respective  Assignor shall promptly
notify the Assignee  thereof and, if requested by the Assignee,  shall  promptly
obtain an  acknowledgment  from such bailee,  in form and  substance  reasonably
satisfactory  to the  Assignee,  that the bailee holds such  Collateral  for the
benefit of the Assignee  and shall act upon the  instructions  of the  Assignee,
without the further consent of the respective Assignor. The Assignee agrees with
the Assignors that the Assignee shall not give any such  instructions  unless an
Event of Default has occurred and is continuing or would occur after taking into
account any action by the respective Assignor with respect to any such bailee.

                                   ARTICLE III

         SPECIAL PROVISIONS CONCERNING RECEIVABLES; INSTRUMENTS; CHATTEL
                       PAPER AND CERTAIN OTHER COLLATERAL

          3.1. Additional  Representations  and Warranties.  As of the time when
each  of  its  Receivables  arises,  each  Assignor  shall  be  deemed  to  have
represented and warranted that each such Receivable, and all records, papers and
documents relating thereto (if any) are genuine and what they purport to be, and
that all  papers  and  documents  (if any)  relating  thereto  (i) will,  to the
knowledge of such  Assignor,  represent  the genuine,  legal,  valid and binding
obligation of the account debtor evidencing  indebtedness unpaid and owed by the
respective account debtor arising out of the performance of labor or services or
the sale or lease and delivery of the merchandise listed therein,  or both, (ii)
will be the only original  writings  evidencing and embodying such obligation of
the  account  debtor  named  therein  (other  than  copies  created  for general
accounting  purposes),  (iii) will, to the knowledge of such Assignor,  evidence
true and valid  obligations,  enforceable  in accordance  with their  respective
terms, and (iv) will be in compliance and will conform in all material  respects
with all applicable  federal,  state and local laws and  applicable  laws of any
relevant foreign jurisdiction.

          3.2.  Maintenance of Records.  Each Assignor will keep and maintain at
its own cost and expense accurate records of its Receivables, including, but not
limited to, originals of all documentation with respect thereto,  records of all
payments received, all credits granted thereon, all merchandise returned and all
other dealings therewith, and such Assignor will make the same available on such
Assignor's premises to the Assignee for inspection,  at such Assignor's own cost
and expense,  at any and all reasonable times upon prior notice to such Assignor
and otherwise in accordance with the Credit  Agreement.  Upon the occurrence and
during  the  continuance  of an  Event  of  Default  and at the  request  of the
Assignee, such Assignor shall, at its own cost and expense, deliver all tangible
evidence  of its  Receivables  (including,  without  limitation,  all  documents
evidencing the Receivables) and such books and records to the Assignee or to its
representatives  (copies of which evidence and books and records may be retained
by such Assignor). Upon the occurrence and during the continuance of an Event of
Default and if the Assignee so directs,  such Assignor shall legend, in form and
manner satisfactory to the Assignee, the Receivables,  as well as books, records
and  documents  (if  any) of such  Assignor  evidencing  or  pertaining  to such
Receivables with an appropriate reference to the

<PAGE>

fact that such  Receivables  have been  assigned  to the  Assignee  and that the
Assignee has a security interest therein.

          3.3. Direction to Account Debtors;  Contracting Parties; etc. Upon the
occurrence and during the continuance of an Event of Default, if the Assignee so
directs any Assignor,  such Assignor agrees (x) to cause all payments on account
of the Receivables to be made directly to the Collateral  Account,  (y) that the
Assignee  may, at its option,  directly  notify the obligors with respect to any
Receivables  to make payments with respect  thereto as provided in the preceding
clause  (x),  and (z) that  the  Assignee  may  enforce  collection  of any such
Receivables and may adjust,  settle or compromise the amount of payment thereof,
in the same manner and to the same extent as such Assignor. Without notice to or
assent by any Assignor,  the Assignee may,  upon the  occurrence  and during the
continuance  of an  Event of  Default,  apply  any or all  amounts  then in,  or
thereafter  deposited  in, the  Collateral  Account  toward  the  payment of the
Obligations  in the  manner  provided  in  Section  5.4 of this  Agreement.  The
reasonable  costs and expenses of collection  (including  reasonable  attorneys'
fees),  whether  incurred by an Assignor or the Assignee,  shall be borne by the
relevant Assignor.  The Assignee shall deliver a copy of each notice referred to
in the  preceding  clause (y) to the relevant  Assignor,  provided  that (x) the
failure  by the  Assignee  to so  notify  such  Assignor  shall not  affect  the
effectiveness of such notice or the other rights of the Assignee created by this
Section 3.3 and (y) no such  notice  shall be required if an Event of Default of
the type  described in Section 8.05 of the Credit  Agreement has occurred and is
continuing.

          3.4.  Modification  of  Terms;  etc.  Except in  accordance  with such
Assignor's  ordinary course of business and consistent with reasonable  business
judgment, no Assignor shall rescind or cancel any indebtedness  evidenced by any
Receivable,  or modify any term  thereof  or make any  adjustment  with  respect
thereto,  or extend or renew the same,  or  compromise  or settle  any  material
dispute,  claim,  suit  or  legal  proceeding  relating  thereto,  or  sell  any
Receivable,  or  interest  therein,  without  the prior  written  consent of the
Assignee.  No Assignor  will do anything to impair the rights of the Assignee in
the Receivables.

          3.5.  Collection.  Each Assignor  shall  endeavor in  accordance  with
reasonable  business  practices to cause to be collected from the account debtor
named  in  each  of  its  Receivables,  as  and  when  due  (including,  without
limitation,  amounts  which are  delinquent,  such  amounts to be  collected  in
accordance  with generally  accepted lawful  collection  procedures) any and all
amounts owing under or on account of such  Receivable,  and apply forthwith upon
receipt thereof all such amounts as are so collected to the outstanding  balance
of such  Receivable.  Except as  otherwise  directed by the  Assignee  after the
occurrence and during the continuation of an Event of Default,  any Assignor may
allow in the ordinary  course of business as  adjustments to amounts owing under
its Receivables (i) an extension or renewal of the time or times of payment,  or
settlement  for less than the total unpaid  balance,  which such Assignor  finds
appropriate in accordance with reasonable business judgment and (ii) a refund or
credit  due as a  result  of  returned  or  damaged  merchandise  or  improperly
performed services or for other reasons which such Assignor finds appropriate in
accordance with reasonable business judgment.  The reasonable costs and expenses
(including,  without  limitation,  reasonable  attorneys'  fees) of

<PAGE>

collection,  whether incurred by an Assignor or the Assignee,  shall be borne by
the relevant Assignor.

          3.6.  Instruments.  If any Assignor  owns or acquires  any  Instrument
constituting  Collateral  (other  than  checks  and  other  payment  instruments
received and collected in the ordinary  course of business),  such Assignor will
within 10 Business  Days notify the  Assignee  thereof,  and upon request by the
Assignee will  promptly  deliver such  Instrument to the Assignee  appropriately
endorsed to the order of the Assignee as further security hereunder.

          3.7. Assignors Remain Liable Under Receivables. Anything herein to the
contrary  notwithstanding,  the Assignors  shall remain liable under each of the
Receivables to observe and perform all of the  conditions and  obligations to be
observed and performed by it thereunder, all in accordance with the terms of any
agreement  giving  rise to such  Receivables.  The  Assignee  shall not have any
obligation  or liability  under any  Receivable  (or any  agreement  giving rise
thereto)  by reason of or arising  out of this  Agreement  or the receipt by the
Assignee of any payment relating to such Receivable  pursuant hereto,  nor shall
the Assignee be obligated in any manner to perform any of the obligations of any
Assignor  under or  pursuant to any  Receivable  (or any  agreement  giving rise
thereto),  to make any  payment,  to make any  inquiry  as to the  nature or the
sufficiency  of any  payment  received by them or as to the  sufficiency  of any
performance  by any party under any  Receivable  (or any  agreement  giving rise
thereto),  to  present or file any  claim,  to take any  action to  enforce  any
performance  or to  collect  the  payment  of any  amounts  which  may have been
assigned to them or to which they may be entitled at any time or times.

          3.8.  Collateral  Account;  Deposit  Accounts.  (a) The  Assignee  may
establish for its own benefit an account for the purposes of this Agreement (the
"Collateral Account"). The Assignee shall be under the sole dominion and control
of the Assignee and the Assignee  shall have the sole right to make  withdrawals
from the  Collateral  Account  and to exercise  all rights  with  respect to the
Collateral  from  time  to  time  therein.  All  Collateral  to be  held  in the
Collateral Account pursuant hereto and the Credit Agreement shall be held in the
Collateral Account in accordance with the provisions hereof.

          (b) For each deposit or similar  account that any Assignor at any time
opens or maintains,  such Assignor shall, at the Assignee's request, pursuant to
a  control  agreement  in form  and  substance  reasonably  satisfactory  to the
Assignee,  either (a) cause the  depositary  bank to agree to comply at any time
with  instructions  from the  Assignee to such  depositary  bank  directing  the
disposition of funds from time to time credited to such deposit account, without
further consent of the respective  Assignor,  or (b) arrange for the Assignee to
become the customer of the depositary bank with respect to the deposit  account,
with the  respective  Assignor  being  permitted,  only with the  consent of the
Assignee,  to exercise rights to withdraw funds from such deposit  account.  The
Assignee  agrees with the  Assignors  that the Assignee  shall not give any such
instructions  or withhold any  withdrawal  rights from any  Assignor,  unless an
Event of Default has occurred and is continuing,  or, after giving effect to any
withdrawal not otherwise permitted by the Secured Debt Agreements,  would occur.
As of the date  hereof,  all  deposit and similar  accounts  maintained  by each
Assignor is set forth in Annex E hereto (the  "Annex E

<PAGE>

Accounts").  No Assignor shall open any new depositary or similar account unless
(i) it shall  have given the  Assignee  at least 15 days  prior  written  notice
thereof  and (ii) it shall have taken all actions  requested  to be taken by the
Assignee  with  respect  thereto as  otherwise  described  above in this Section
3.8(b).  Unless an Event of Default has occurred and is  continuing  (whereupon,
upon such Event of Default,  no funds may be  withdrawn by any Assignor or other
Person,  subject to applicable laws, from any Annex E Accounts without the prior
written consent or instructions of the Lender),  funds may be withdrawn from the
Annex E Accounts  by the  respective  Assignor  exclusively  for the  purpose of
making  payments to current  account  debtors in the ordinary course of business
and for payroll,  payroll taxes and other employee wage and benefit  payments to
or for the benefit of such Assignors' salaried employees.

                                   ARTICLE IV

                      PROVISIONS CONCERNING ALL COLLATERAL

          4.1. Protection of Assignee's Security.  Except as otherwise permitted
by the Secured  Debt  Agreements,  each  Assignor  will do nothing to impair the
rights of the Assignee in the  Collateral.  Each Assignor will at all times keep
its Inventory and Equipment insured in favor of the Assignee, at such Assignor's
own  expense  to the  extent  and in the manner  provided  in the  Secured  Debt
Agreements.  Except to the extent  otherwise  permitted  to be  retained by such
Assignor or applied by such  Assignor  pursuant to the terms of the Secured Debt
Agreements,  the Assignee  shall, at the time any proceeds of such insurance are
distributed to the Assignee,  apply such proceeds in accordance with Section 5.4
hereof.  Each Assignor  assumes all liability and  responsibility  in connection
with the Collateral acquired by it and the liability of such Assignor to pay the
Obligations shall in no way be affected or diminished by reason of the fact that
such  Collateral  may be lost,  destroyed,  stolen,  damaged  or for any  reason
whatsoever unavailable to such Assignor.

          4.2. Warehouse  Receipts  Non-negotiable.  To the extent  practicable,
each Assignor agrees that if any warehouse receipt or receipt in the nature of a
warehouse receipt is issued with respect to any of its Inventory,  such Assignor
shall request that such warehouse receipt or receipt in the nature thereof shall
not be  "negotiable"  (as such  term is used in  Section  7-104  of the  Uniform
Commercial  Code as in  effect  in any  relevant  jurisdiction  or  under  other
relevant law).

                  4.3. Further Actions. Each Assignor will, at its own expense
and upon the reasonable request of the Assignee, make, execute, endorse,
acknowledge, file and/or deliver to the Assignee from time to time such lists,
descriptions and designations of its Collateral, warehouse receipts, receipts in
the nature of warehouse receipts, bills of lading, documents of title, vouchers,
invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, certificates, reports and other assurances or
instruments and take such further steps relating to the Collateral and other
property or rights covered by the security interest hereby granted, which the
Assignee deems reasonably appropriate or advisable to perfect, preserve or
protect its security interest in the Collateral.

<PAGE>

          4.4. Financing Statements. Each Assignor agrees to execute and deliver
to the Assignee such financing statements,  in form reasonably acceptable to the
Assignee,  as the  Assignee may from time to time  reasonably  request or as are
reasonably  necessary  or  desirable in the opinion of the Assignee to establish
and maintain a valid, enforceable, perfected security interest in the Collateral
as provided herein and the other rights and security  contemplated  hereby. Each
Assignor  will pay any  applicable  filing fees,  recordation  taxes and related
expenses  relating  to its  Collateral.  Each  Assignor  hereby  authorizes  the
Assignee to file any such  financing  statements  without the  signature of such
Assignor where permitted by law (and such authorization  includes describing the
Collateral as "all assets" of such Assignor).

                                    ARTICLE V

                 REMEDIES UPON OCCURRENCE OF AN EVENT OF DEFAULT

          5.1.  Remedies;  Obtaining the Collateral Upon Default.  Each Assignor
agrees that, if any Event of Default shall have occurred and be continuing, then
and in every such case, the Assignee, in addition to any rights now or hereafter
existing under  applicable law and under the other provisions of this Agreement,
shall have all rights as a secured  creditor under any UCC, and such  additional
rights and  remedies to which a secured  creditor is entitled  under the laws in
effect in all relevant jurisdictions and may:

          (i) personally, or by agents or attorneys, immediately take possession
     of the  Collateral  or any part  thereof,  from such  Assignor or any other
     Person who then has  possession of any part thereof with or without  notice
     or  process of law,  and for that  purpose  may enter upon such  Assignor's
     premises where any of the Collateral is located and remove the same and use
     in connection  with such removal any and all services,  supplies,  aids and
     other facilities of such Assignor;

          (ii) instruct the obligor or obligors on any agreement,  instrument or
     other  obligation   (including,   without   limitation,   the  Receivables)
     constituting  the  Collateral to make any payment  required by the terms of
     such agreement, instrument or other obligation directly to the Assignee and
     may  exercise  any and all  remedies  of such  Assignor  in respect of such
     Collateral;

          (iii) instruct all depositary  banks which have entered into a control
     agreement  with  the  Assignee  to  transfer  all  monies,  securities  and
     instruments held by such depositary bank to the Collateral Account;

          (iv) withdraw all monies, securities and instruments in the Collateral
     Account and in the Collateral Account for application to the Obligations in
     accordance with Section 5.4 hereof;

          (v) sell,  assign or otherwise  liquidate any or all of the Collateral
     or any part thereof in  accordance  with Section 5.2 hereof,  or direct the
     relevant Assignor to sell, assign or otherwise  liquidate any or all of the
     Collateral or any part thereof,  and, in each case,  take possession of the
     proceeds of any such sale or liquidation;

          (vi)  take  possession  of the  Collateral  or any  part  thereof,  by
     directing  the  relevant  Assignor  in writing  to deliver  the same to the
     Assignee at any reasonable place or places  designated by the Assignee,  in
     which event such Assignor shall at its own expense:

               (x)  forthwith  cause the same to be moved to the place or places
          so designated by the Assignee and there delivered to the Assignee;

               (y) store and keep any Collateral so delivered to the Assignee at
          such  place or  places  pending  further  action  by the  Assignee  as
          provided in Section 5.2 hereof; and

               (z) while the  Collateral  shall be so stored  and kept,  provide
          such  security  and  maintenance   services  as  shall  be  reasonably
          necessary  to protect the same and to preserve and maintain it in good
          condition;

it being understood that each Assignor's obligation so to deliver the Collateral
is of the essence of this Agreement and that, accordingly, upon application to a
court of equity having jurisdiction,  the Assignee shall be entitled to a decree
requiring specific performance by such Assignor of said obligation.

          5.2. Remedies;  Disposition of the Collateral. If any Event of Default
shall have occurred and be continuing,  then any  Collateral  repossessed by the
Assignee  under or  pursuant  to Section  5.1  hereof  and any other  Collateral
whether or not so repossessed by the Assignee, may be sold, assigned,  leased or
otherwise disposed of under one or more contracts or as an entirety, and without
the necessity of gathering at the place of sale the property to be sold,  and in
general in such  manner,  at such time or times,  at such place or places and on
such terms as the Assignee may, in compliance with any mandatory requirements of
applicable law, determine to be commercially  reasonable.  Any of the Collateral
may be sold, leased or otherwise disposed of, in the condition in which the same
existed  when  taken by the  Assignee  or after  any  overhaul  or repair at the
expense of the  relevant  Assignor  which the  Assignee  shall  determine  to be
commercially  reasonable.  Any such disposition which shall be a private sale or
other private proceedings  permitted by such requirements shall be made upon not
less than 10 days' prior written notice to the relevant Assignor  specifying the
time at which  such  disposition  is to be made and the  intended  sale price or
other consideration  therefor,  and shall be subject,  for the 10 days after the
giving of such notice,  to the right of the relevant  Assignor or any nominee of
such  Assignor to acquire the  Collateral  involved at a price or for such other
consideration  at least equal to the intended sale price or other  consideration
so specified.  Any such  disposition  which shall be a public sale  permitted by
such requirements shall be made upon not less than 10 days' prior written notice
to the relevant Assignor  specifying the time and place of such sale and, in the
absence of applicable  requirements  of law,  shall be by public  auction (which
may, at the  Assignee's  option,  be subject to reserve),  after  publication of
notice of such auction (where  required by applicable law) not less than 10 days
prior  thereto.  The Assignee may,  without notice or  publication,  adjourn any
public or private  sale or cause the same to be  adjourned  from time to time by
announcement at the time and place fixed for the sale, and such sale may be made
at any  time or place to which  the  sale  may be so  adjourned.  To the  extent
permitted  by any such  requirement  of law, the Assignee may bid for and become
the  purchaser  of the  Collateral  or any  item  thereof,  offered  for sale in
accordance  with  this  Section  5.2  without  accountability  to  the  relevant
Assignor.  If, under  applicable  law,  the Assignee  shall be permitted to make
disposition of the Collateral  within a period of time which does not permit the
giving of notice to the relevant Assignor as hereinabove specified, the Assignee
need give such Assignor only such notice of  disposition  as shall be reasonably
practicable in view of such  applicable law. Each Assignor agrees to do or cause
to be done all such other acts and things as may be reasonably necessary to make
such sale or sales of all or any portion of the Collateral valid and binding and
in compliance  with any and all applicable  laws,  regulations,  orders,  writs,
injunctions,   decrees  or  awards  of  any  and  all  courts,   arbitrators  or
governmental  instrumentalities,  domestic or foreign,  having jurisdiction over
any such sale or sales, all at such Assignor's expense.

          5.3. Waiver of Claims. Except as otherwise provided in this Agreement,
EACH ASSIGNOR HEREBY WAIVES,  TO THE EXTENT  PERMITTED BY APPLICABLE LAW, NOTICE
AND JUDICIAL  HEARING IN CONNECTION WITH THE LENDER'S  TAKING  POSSESSION OR THE
LENDER'S  DISPOSITION OF ANY OF THE COLLATERAL,  INCLUDING,  WITHOUT LIMITATION,
ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES, and
each Assignor hereby further waives, to the extent permitted by law:

          (i) all damages  occasioned  by such taking of  possession  except any
     damages which are the direct result of the Assignee's  gross  negligence or
     willful misconduct (as determined by a court of competent jurisdiction in a
     final and non-appealable decision);

          (ii) all other requirements as to the time, place and terms of sale or
     other requirements with respect to the enforcement of the Assignee's rights
     hereunder; and

          (iii)  all  rights  of  redemption,  appraisement,   valuation,  stay,
     extension or moratorium  now or hereafter in force under any applicable law
     in order to  prevent  or delay the  enforcement  of this  Agreement  or the
     absolute sale of the Collateral or any portion thereof,  and each Assignor,
     for  itself  and all who may claim  under it,  insofar as it or they now or
     hereafter lawfully may, hereby waives the benefit of all such laws.

Any sale of, or the grant of options to purchase, or any other realization upon,
any Collateral  shall operate to divest all right,  title,  interest,  claim and
demand,  either  at law or in  equity,  of the  relevant  Assignor  therein  and
thereto,  and shall be a perpetual  bar both at law and in equity  against  such
Assignor  and against any and all Persons  claiming or  attempting  to claim the
Collateral  so sold,  optioned  or realized  upon,  or any part  thereof,  from,
through and under such Assignor.

          5.4. Application of Proceeds. (a) All moneys collected by the Assignee
upon any sale or other  disposition  of the  Collateral  (and, to the extent any
other  Security  Document  requires  proceeds  of  collateral  under  such other
Security  Document  to be  applied in  accordance  with the  provisions  of this
Agreement,  all moneys  collected  by the  Assignee  under  such other  Security
Document  upon  any sale or  other  disposition  of  collateral  under  any such
Security  Document),  together  with all other  moneys  received by the Assignee
hereunder and under each other Security Document, shall be applied as follows:

          (i) first, to the payment of all amounts owing to th-e Assignee of the
     type described in clause (iv) of the definition of "Obligations";

          (ii)  second,  to the extent  proceeds  remain  after the  application
     pursuant to preceding clause (i), an amount equal to the outstanding Senior
     Obligations shall be paid to the Assignee; and

          (iii)  third,  to the extent  proceeds  remain  after the  application
     pursuant to preceding  clauses (i) through (ii),  inclusive,  and following
     the termination of this Agreement pursuant to Section 8.8(a) hereof, to the
     relevant  Assignor or to whomever may be lawfully  entitled to receive such
     surplus.

          (b)  This  Agreement  is made  with  full  recourse  to each  Assignor
(including,  without  limitation,  with  full  recourse  to all  assets  of such
Assignor)  and  pursuant  to  and  upon  all  the  warranties,  representations,
covenants and agreements on the part of such Assignor  contained  herein, in the
other Secured Debt Agreements and otherwise in writing in connection herewith or
therewith.  It is  understood  that  the  Assignors  shall  remain  jointly  and
severally  liable to the  extent of any  deficiency  between  the  amount of the
proceeds of the Collateral and the aggregate amount of the Obligations.

          5.5.  Remedies  Cumulative.  Each and every  right,  power and  remedy
hereby  specifically  given to the Assignee  shall be in addition to every other
right, power and remedy specifically given to the Assignee under this Agreement,
the other Secured Debt Agreements or now or hereafter existing at law, in equity
or by statute and each and every right,  power and remedy  whether  specifically
herein  given  or  otherwise  existing  may be  exercised  from  time to time or
simultaneously  and as often and in such order as may be deemed expedient by the
Assignee.  All such rights,  powers and  remedies  shall be  cumulative  and the
exercise or the beginning of the exercise of one shall not be deemed a waiver of
the right to exercise any other or others.  No delay or omission of the Assignee
in the  exercise of any such right,  power or remedy and no renewal or extension
of any of the Obligations shall impair any such right,  power or remedy or shall
be  construed  to  be a  waiver  of  any  Default  or  Event  of  Default  or an
acquiescence  therein.  No notice to or demand on any Assignor in any case shall
entitle  it to any  other or  further  notice  or  demand  in  similar  or other
circumstances or constitute a waiver of any of the rights of the Assignee to any
other or further action in any  circumstances  without notice or demand.  In the
event  that the  Assignee  shall  bring any suit to  enforce  any of its  rights
hereunder and shall be entitled to judgment,  then in such suit the Assignee may
recover  reasonable

<PAGE>

expenses, including reasonable attorneys' fees, and the amounts thereof shall be
included in such judgment.

          5.6.  Discontinuance  of Proceedings.  In case the Assignee shall have
instituted  any  proceeding  to enforce  any right,  power or remedy  under this
Agreement by foreclosure,  sale,  entry or otherwise,  and such proceeding shall
have been discontinued or abandoned for any reason or shall have been determined
adversely to the  Assignee,  then and in every such case the relevant  Assignor,
the  Assignee  and each  holder of any of the  Obligations  shall be restored to
their former  positions  and rights  hereunder  with  respect to the  Collateral
subject to the security  interest created under this Agreement,  and all rights,
remedies and powers of the Assignee shall continue as if no such  proceeding had
been instituted.

                                   ARTICLE VI

                                    INDEMNITY

          6.1.  Indemnity.  (a) Each Assignor  jointly and  severally  agrees to
indemnify,  reimburse  and  hold the  Assignee  and its  respective  successors,
assigns,  employees,  affiliates  and agents  (hereinafter  in this  Section 6.1
referred to individually as  "Indemnitee,"  and  collectively as  "Indemnitees")
harmless  from  any  and  all  liabilities,   obligations,   damages,  injuries,
penalties,  claims,  demands,  actions,  suits, judgments and any and all costs,
expenses or disbursements  (including  reasonable  attorneys' fees and expenses)
(for the  purposes of this Section 6.1 the  foregoing  are  collectively  called
"expenses")  of  whatsoever  kind and nature  imposed  on,  asserted  against or
incurred by any of the Indemnitees in any way relating to or arising out of this
Agreement,  any other Secured Debt Agreement or any other  document  executed in
connection  herewith  or  therewith  or in any  other  way  connected  with  the
administration  of  the  transactions  contemplated  hereby  or  thereby  or the
enforcement of any of the terms of, or the  preservation of any rights under any
thereof, or in any way relating to or arising out of the manufacture, ownership,
ordering, purchase, delivery, control, acceptance, lease, financing, possession,
operation,  condition,  sale,  return  or  other  disposition,  or  use  of  the
Collateral (including,  without limitation,  latent or other defects, whether or
not  discoverable),  the  violation of the laws of any  country,  state or other
governmental  body or unit,  any tort  (including,  without  limitation,  claims
arising or imposed under the doctrine of strict liability,  or for or on account
of injury to or the death of any Person (including any Indemnitee),  or property
damage),  or contract  claim;  provided that no Indemnitee  shall be indemnified
pursuant to this Section 6.1(a) for losses, damages or liabilities to the extent
caused by the gross  negligence  or willful  misconduct of such  Indemnitee  (as
determined by a court of competent  jurisdiction  in a final and  non-appealable
decision).  Each Assignor  agrees that upon written  notice by any Indemnitee of
the assertion of such a liability,  obligation,  damage, injury, penalty, claim,
demand,  action,  suit or  judgment,  the  relevant  Assignor  shall assume full
responsibility  for the defense thereof.  Each Indemnitee agrees to use its best
efforts to promptly notify the relevant  Assignor of any such assertion of which
such Indemnitee has knowledge.

          (b) Without  limiting the  application of Section 6.1(a) hereof,  each
Assignor agrees, jointly and severally, to pay or reimburse the Assignee for any
and all reasonable fees,

<PAGE>

costs and expenses of whatever kind or nature  incurred in  connection  with the
creation,  preservation  or protection of the Assignee's  Liens on, and security
interest in, the Collateral,  including,  without limitation, all fees and taxes
in  connection  with the  recording or filing of  instruments  and  documents in
public offices, payment or discharge of any taxes or Liens upon or in respect of
the  Collateral,  premiums for insurance  with respect to the Collateral and all
other fees,  costs and expenses in connection  with  protecting,  maintaining or
preserving the Collateral and the Assignee's  interest therein,  whether through
judicial  proceedings or otherwise,  or in defending or prosecuting any actions,
suits or proceedings arising out of or relating to the Collateral.

          (c) Without  limiting the application of Section 6.1(a) or (b) hereof,
each Assignor  agrees,  jointly and severally,  to pay,  indemnify and hold each
Indemnitee harmless from and against any loss, costs, damages and expenses which
such Indemnitee may suffer,  expend or incur in consequence of or growing out of
any misrepresentation by any Assignor in this Agreement,  any other Secured Debt
Agreement or in any writing  contemplated by or made or delivered pursuant to or
in connection with this Agreement or any other Secured Debt Agreement.

          (d) If and to the extent that the  obligations  of any Assignor  under
this Section 6.1 are unenforceable  for any reason,  such Assignor hereby agrees
to make  the  maximum  contribution  to the  payment  and  satisfaction  of such
obligations which is permissible under applicable law.

          6.2.  Indemnity  Obligations  Secured  by  Collateral;  Survival.  Any
amounts  paid by any  Indemnitee  as to which such  Indemnitee  has the right to
reimbursement  shall  constitute  Obligations  secured  by the  Collateral.  The
indemnity  obligations  of each  Assignor  contained  in this Article VIII shall
continue in full force and effect notwithstanding the full payment of all of the
other Obligations and  notwithstanding  the full payment of all the Notes issued
under  the  Credit  Agreement  and the  payment  of all  other  Obligations  and
notwithstanding the discharge thereof.

                                   ARTICLE VII

                                   DEFINITIONS

          The following  terms shall have the meanings  herein  specified.  Such
definitions shall be equally  applicable to the singular and plural forms of the
terms defined.

          "Agreement"  shall  mean this  Security  Agreement  as the same may be
modified,  supplemented  or  amended  from time to time in  accordance  with its
terms.

          "Assignor"  shall have the meaning  provided in the first paragraph of
this Agreement.

          "Collateral" shall have the meaning provided in Section 1.1(a) of this
Agreement.

          "Collateral Account" shall have the meaning provided in Section 3.8(a)
hereof.

<PAGE>

          "Credit  Agreement" shall have the meaning provided in the recitals of
this Agreement.

          "Credit Document  Obligations"  shall have the meaning provided in the
definition of "Obligations" in this Article VII.

          "Default"  shall mean any event which with notice or lapse of time, or
both, would constitute an Event of Default.

          "Equipment" shall mean any "equipment," as such term is defined in the
Uniform  Commercial  Code as in  effect  on the date  hereof in the State of New
York, now or hereafter  owned by any Assignor and, in any event,  shall include,
but shall not be limited to, all machinery, equipment, furnishings, fixtures and
vehicles  now or  hereafter  owned by any  Assignor  and any and all  additions,
substitutions  and  replacements  of any of the  foregoing  and  all  accessions
thereto,  wherever located,  together with all attachments,  components,  parts,
equipment and accessories installed thereon or affixed thereto.

          "Event of  Default"  shall  mean any Event of  Default  under,  and as
defined  in,  the  Credit  Agreement  and  shall in any event  include,  without
limitation,  any payment default on any of the Obligations  after the expiration
of any applicable grace period.

          "Indemnitee" shall have the meaning provided in Section 6.1(a) of this
Agreement.

          "Instrument" shall have the meaning provided in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.

          "Inventory"  shall mean  merchandise,  inventory  and  goods,  and all
additions,  substitutions and replacements  thereof and all accessions  thereto,
wherever  located,  together with all goods,  supplies,  incidentals,  packaging
materials,   labels,   materials   and  any  other   items  used  or  usable  in
manufacturing,  processing,  packaging  or  shipping  same,  in  all  stages  of
production from raw materials through work in process to finished goods, and all
products and proceeds of whatever sort and wherever  located any portion thereof
which may be returned,  rejected,  reclaimed or repossessed by the Assignee from
any Assignor's customers, and shall specifically include all "inventory" as such
term in defined in the Uniform  Commercial  Code as in effect on the date hereof
in the State of New York, now or hereafter owned by any Assignor.

          "Assignee"  shall have the meaning  provided  in the  recitals of this
Agreement.

          "Liens"  shall mean any security  interest,  mortgage,  pledge,  lien,
claim, charge,  encumbrance,  title retention agreement,  lessor's interest in a
financing lease or analogous instrument, in, of, or on any Assignor's property.

          "Obligations"  shall  mean (i) the full and  prompt  payment  when due
(whether  at  the  stated  maturity,   by  acceleration  or  otherwise)  of  all
obligations,   liabilities  and  indebtedness  (including,  without  limitation,
principal, premium, interest, fees, costs and indemnities

<PAGE>

(including, without limitation, all interest that accrues after the commencement
of any case, proceeding or other action relating to the bankruptcy,  insolvency,
reorganization or similar proceeding of any Assignor at the rate provided for in
the respective documentation,  whether or not a claim for post-petition interest
is allowed in any such  proceeding))  of each Assignor to the Assignee,  whether
now existing or hereafter incurred under, arising out of, or in connection with,
the Credit  Agreement and the other Credit Documents to which such Assignor is a
party  (including,  in the case of each Assignor  that is a Guarantor,  all such
obligations, liabilities and indebtedness of such Assignor under the Guaranty to
which it is a party) and the due  performance  and  compliance  by such Assignor
with  all of the  terms,  conditions  and  agreements  contained  in the  Credit
Agreement and in such other Credit Documents (all such obligations,  liabilities
and  indebtedness  under this clause (i), being herein  collectively  called the
"Credit Document  Obligations");  (ii) any and all sums advanced by the Assignee
in order to preserve the  Collateral  or preserve  its security  interest in the
Collateral;  (iii)  in the  event  of  any  proceeding  for  the  collection  or
enforcement of any  indebtedness,  obligations,  or liabilities of such Assignor
referred to in clauses (i) or (ii) above,  after an Event of Default  shall have
occurred  and be  continuing,  the  reasonable  expenses of  retaking,  holding,
preparing for sale or lease,  selling or otherwise  disposing of or realizing on
the  Collateral,  or of any  exercise by the  Assignee of its rights  hereunder,
together with reasonable  attorneys' fees and court costs;  and (iv) all amounts
paid  by  any  Indemnitee  as  to  which  such   Indemnitee  has  the  right  to
reimbursement  under Section 6.1 of this Agreement;  it being  acknowledged  and
agreed that the  "Obligations"  shall include  extensions of credit of the types
described above,  whether  outstanding on the date of this Agreement or extended
from time to time after the date of this Agreement.

          "Proceeds" shall have the meaning  provided in the Uniform  Commercial
Code as in  effect in the  State of New York on the date  hereof or under  other
relevant law and, in any event,  shall  include,  but not be limited to, (i) any
and all proceeds of any insurance,  indemnity,  warranty or guaranty  payable to
the  Assignee  or any  Assignor  from  time to time with  respect  to any of the
Collateral,  (ii) any and all payments (in any form  whatsoever) made or due and
payable to any Assignor  from time to time in connection  with any  requisition,
confiscation,  condemnation,  seizure  or  forfeiture  of all or any part of the
Collateral  by any  governmental  authority (or any person acting under color of
governmental  authority)  and (iii) any and all other  amounts from time to time
paid or payable under or in connection with any of the Collateral.

          "Receivables"  shall mean any "account" as such term is defined in the
Uniform  Commercial  Code as in  effect  on the date  hereof in the State of New
York, now or hereafter  owned by any Assignor and, in any event,  shall include,
but  shall not be  limited  to,  all of such  Assignor's  rights to  health-care
insurance  receivables  and to  payment  for goods  sold or  leased or  services
performed  by such  Assignor,  whether now in  existence or arising from time to
time hereafter,  including, without limitation,  rights evidenced by an account,
note  contract,  security  agreement,   chattel  paper,  or  other  evidence  of
indebtedness  or security,  together  with (a) all security  pledged,  assigned,
hypothecated or granted to or held by such Assignor to secure the foregoing, (b)
all of any Assignor's right, title and interest in and to any goods, the sale of
which gave rise thereto,  (c) all guarantees,  endorsements and indemnifications
on, or of, any of the foregoing, (d) all powers of attorney for the execution of
any  evidence  of  indebtedness  or  security  or other  writing  in  connection
therewith, (e) all books, records, ledger cards, and

<PAGE>

invoices  relating  thereto,  (f) all  instruments  in connection  therewith and
amendments  thereto,   notices  to  other  creditors  or  secured  parties,  and
certificates  from  filing  or  other  registration  officers,  (g)  all  credit
information,  reports and memoranda  relating thereto and (h) all other writings
related in any way to the foregoing.

          "Secured Debt  Agreements"  shall mean and include this  Agreement and
the other Credit Documents.

          "Senior  Obligations"  shall mean in the case of the  Credit  Document
Obligations, all principal of, premium (if any), and interest on, the Loan under
the Credit Agreement, and similar obligations and liabilities.

          "Termination  Date" shall have the meaning  provided in Section 8.8(a)
of this Agreement.

          "UCC" shall mean the Uniform Commercial Code as in effect from time to
time in the relevant jurisdiction.

                                  ARTICLE VIII

                                  MISCELLANEOUS

          8.1.  Notices.  Except as  otherwise  specified  herein,  all notices,
requests,  demands or other  communications  to or upon the  respective  parties
hereto shall be sent or delivered by mail, telegraph,  telex, telecopy, cable or
courier  service and all such  notices and  communications  shall,  when mailed,
telegraphed,  telexed,  telecopied,  or cabled or sent by courier,  be effective
when deposited in the mails,  delivered to the telegraph company,  cable company
or overnight courier, as the case may be, or sent by telex or telecopier, except
that notices and  communications  to the  Assignee or any Assignor  shall not be
effective  until received by the Assignee or such Assignor,  as the case may be.
All  notices  and other  communications  shall be in writing  and  addressed  as
follows:

          (a)  if to any  Assignor,  at  its  address  set  forth  opposite  its
               signature below;

          (b) if to the Assignee, at:

               145 Belmont Drive
               Somerset,  New Jersey 08873
               Attention:  Chief Financial Officer
               Telephone No.: (732) 271-9090
               Telecopier No.:(732) 271-9783

or at such other  address or  addressed to such other  individual  as shall have
been furnished in writing by any Person described above to the party required to
give notice hereunder.

<PAGE>

          8.2.  Waiver;  Amendment.  None of the  terms and  conditions  of this
Agreement or any other  Security  Document may be changed,  waived,  modified or
varied in any manner  whatsoever  unless in writing duly signed by each Assignor
directly affected thereby and the Assignee.

          8.3. Obligations Absolute.  The obligations of each Assignor hereunder
shall  remain in full  force and  effect  without  regard  to,  and shall not be
impaired  by,  (a)  any  bankruptcy,  insolvency,  reorganization,  arrangement,
readjustment,  composition,  liquidation or the like of such  Assignor;  (b) any
exercise  or  non-exercise,  or any  waiver  of,  any  right,  remedy,  power or
privilege  under or in  respect  of this  Agreement  or any other  Secured  Debt
Agreement; or (c) any amendment to or modification of any Secured Debt Agreement
or any security for any of the  Obligations;  whether or not such Assignor shall
have notice or knowledge of any of the foregoing.

          8.4. Successors and Assigns. This Agreement shall be binding upon each
Assignor  and its  successors  and assigns  (although no Assignor may assign its
rights and obligations hereunder except in accordance with the provisions of the
Secured Debt  Agreements) and shall inure to the benefit of the Assignee and its
respective  successors and assigns,  although so long as any Senior  Obligations
remain outstanding or any Commitments with respect thereto remain in effect. All
agreements,  statements,  representations  and warranties  made by each Assignor
herein or in any certificate or other  instrument  delivered by such Assignor or
on its behalf under this Agreement  shall be considered to have been relied upon
by the Assignee and shall survive the  execution and delivery of this  Agreement
and the other Secured Debt Agreements  regardless of any  investigation  made by
the Assignee or on its behalf.

          8.5.  Headings  Descriptive.  The headings of the several  sections of
this Agreement are inserted for convenience only and shall not in any way affect
the meaning or construction of any provision of this Agreement.

          8.6.  Governing Law. THIS AGREEMENT AND THE RIGHTS AND  OBLIGATIONS OF
THE PARTIES  HEREUNDER  SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY
THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CHOICE OF LAW PROVISIONS.

          8.7.  Assignor's  Duties.  It is  expressly  agreed,  anything  herein
contained  to the  contrary  notwithstanding,  that each  Assignor  shall remain
liable to perform all of the obligations,  if any, assumed by it with respect to
the Collateral  and the Assignee  shall not have any  obligations or liabilities
with respect to any  Collateral  by reason of or arising out of this  Agreement,
nor shall the  Assignee  be required  or  obligated  in any manner to perform or
fulfill any of the  obligations  of any  Assignor  under or with  respect to any
Collateral.

          8.8.  Termination;  Release.  (a) After  the  Termination  Date,  this
Agreement  shall  terminate  (provided  that all  indemnities  set forth  herein
including,  without  limitation,  in  Section  6.1  hereof  shall  survive  such
termination)  and the  Assignee,  at the request  and expense of the  respective
Assignor, will promptly execute and deliver to such Assignor a proper instrument
or instruments (including Uniform Commercial Code termination statements on form
UCC-3)

<PAGE>

acknowledging the satisfaction and termination of this Agreement,  and will duly
assign,  transfer and deliver to such Assignor (without recourse and without any
representation  or warranty)  such of the Collateral as may be in the possession
of the Assignee  and as has not  theretofore  been sold or otherwise  applied or
released  pursuant to this Agreement.  As used in this  Agreement,  "Termination
Date" shall mean the date upon which the Commitment  under the Credit  Agreement
has been  terminated,  no Note under the Credit Agreement is outstanding and the
Loan  thereunder  has been repaid in full, and all other  Obligations  have been
paid in full.

          (b) In the event that any part of the Collateral is sold in connection
with a sale permitted by the Secured Debt  Agreements  (other than a sale to any
Assignor)  or is  otherwise  released  with the consent of the  Assignee and the
proceeds of such sale or sales or from such  release  are applied in  accordance
with the  provisions of the Credit  Agreement,  to the extent  required to be so
applied,  such  Collateral  will be sold free and clear of the Liens  created by
this  Agreement  and the  Assignee,  at the request and expense of the  relevant
Assignor,  will duly and promptly assign,  transfer and deliver to such Assignor
(without  recourse  and  without any  representation  or  warranty)  such of the
Collateral  as is then being (or has been) so sold or released  and as may be in
the possession of the Assignee and has not theretofore been released pursuant to
this Agreement.

          (c) At any time that an Assignor  desires that the  Assignee  take any
action to  acknowledge  or give effect to any release of Collateral  pursuant to
the foregoing Section 8.8(a) or (b), such Assignor shall deliver to the Assignee
a  certificate  signed by a senior  officer of such  Assignor  stating  that the
release of the  respective  Collateral  is  permitted  pursuant to such  Section
8.8(a) or (b).

          8.9.  Counterparts.  This  Agreement  may be executed in any number of
counterparts and by the different parties hereto on separate counterparts,  each
of which when so executed and delivered  shall be an original,  but all of which
shall together  constitute one and the same  instrument.  A set of  counterparts
executed by all the parties  hereto  shall be lodged with each  Assignor and the
Assignee.

          8.10.   Severability.   Any  provision  of  this  Agreement  which  is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

          8.11.  Additional  Assignors.  It is  understood  and agreed  that any
Subsidiary  of the Borrower  that is required to execute a  counterpart  of this
Agreement after the date hereof pursuant to the Credit Agreement shall become an
Assignor  hereunder by (x) executing a counterpart hereof and delivering same to
the Assignee,  (y)  delivering  supplements to Annexes A through E hereto as are
necessary to cause such Annexes to be complete and accurate with respect to such
additional Assignor on such date and (z) taking all actions as specified in this
Agreement  as would have been  taken by such  Assignor  had it been an  original
party to this  Agreement,  in each case with all documents  required above to be
delivered to the Assignee and

<PAGE>

with all  documents  and actions  required  above to be taken to the  reasonable
satisfaction of the Assignee.

                                      * * *

<PAGE>

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

Attn:  George J. Zulanas, Jr.                 UNIROYAL OPTOELECTRONICS LLC,
Telephone No.:  (941) 361-2220                  as an Assignor
Telecopier No.:  (941) 361-2214

                                               By:
                                                   -----------------------------
                                                   Name:  George J. Zulanas, Jr.
                                                   Title:  Vice President and
                                                           Treasurer
Accepted and Agreed to:

EMCORE CORPORATION,
   as Assignee and Assignee

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

<PAGE>

                                                                      SCHEDULE 1
                                LIST OF EQUIPMENT

                                                                    AMOUNT
                                                                    (000's)
EQUIPMENT (AT UOE)
MOCVD REACTOR - -EMCORE (GAN #3)                                       $ 995
(SN No. 5548)

MOCVD REACTOR - -EMCORE (GAN #5)                                       $ 541
(SN No. 5803)

MOCVD REACTOR - - EMCORE (GAN #6)                                      $ 681
(SN No. 5859)

MOCVD REACTOR - - EMCORE (GAN #7)                                      $ 681
(SN No. 5858)                                                          -----

NOTE:  NONE OF THE COLLATERAL IS PERMANENTLY AFFIXED TO THE REAL PROPERTY.

<PAGE>

                                                                         ANNEX A
                                                                              to
                                                              SECURITY AGREEMENT

                       SCHEDULE OF CHIEF EXECUTIVE OFFICES
                           AND OTHER RECORD LOCATIONS

        Assignor                                     Chief Executive Office

Uniroyal Optoelectronics, LLC                          3401 Cragmont Drive
                                                       Tampa, FL 33619

<PAGE>

                                                                         ANNEX B
                                                                              to
                                                              SECURITY AGREEMENT

                  SCHEDULE OF INVENTORY AND EQUIPMENT LOCATIONS

               Assignor                                      Location

    Uniroyal Optoelectronics, LLC                       3401 Cragmont Drive
                                                        Tampa, FL 33619

<PAGE>

                                                                         ANNEX C
                                                                              to
                                                              SECURITY AGREEMENT

                  SCHEDULE OF LEGAL, TRADE AND FICTITIOUS NAMES
                    AND ORGANIZATIONAL IDENTIFICATION NUMBERS

I.       Legal Name/Organizational Identification Number
         Uniroyal Optoelectronics, LLC

II.      Trade and Fictitious Names
         None.

<PAGE>

                                                                         Annex D
                                                                              to
                                                              Security Agreement

              SCHEDULE OF JURISDICTIONS AND TYPES OF ORGANIZATIONS

Assignor                         Jurisdiction               Type of Organization
-------                          ------------               --------------------

Uniroyal Optoelectonics, LLC       Delaware                          LLC

<PAGE>

                                                                         Annex E
                                                                              to
                                                              Security Agreement

                               DEPOSITARY ACCOUNTS

<TABLE>
       <S>                         <C>                        <C>                            <C>
          Assignor                     Account No.                Type of Account                Institution
           --------                     -----------                ---------------                -----------
Uniroyal Optoelectronics, LLC        DDA2090002593219              Deposit Account        First Union National Bank

</TABLE>

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>             <C>                                                                                         <C>

                                                                                                               Page
ARTICLE I

                    SECURITY INTERESTS............................................................................1

         1.1.  Grant of Security Interests........................................................................1
         1.2.  Power of Attorney..................................................................................2

ARTICLE II

                    GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS.............................................2

         2.1.  Necessary Filings..................................................................................2
         2.2.  No Liens...........................................................................................3
         2.3.  Other Financing Statements.........................................................................3
         2.4.  Chief Executive Office, Record Locations...........................................................3
         2.5.  Location of Inventory and Equipment................................................................4
         2.6.  Legal Names; Organizational Identification Number; Trade Names; Change of Name; etc................4
         2.7.  Jurisdiction and Type of Organization..............................................................4
         2.8.  Collateral in the Possession of a Bailee...........................................................5

ARTICLE III

                    SPECIAL PROVISIONS CONCERNING RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS; CHATTEL
                    PAPER AND CERTAIN OTHER COLLATERAL............................................................5

         3.1.  Additional Representations and Warranties..........................................................5
         3.2.  Maintenance of Records.............................................................................5
         3.3.  Direction to Account Debtors; Contracting Parties; etc.............................................6
         3.4.  Modification of Terms; etc.........................................................................6
         3.5.  Collection.........................................................................................6
         3.6.  Instruments........................................................................................7
         3.7.  Assignors Remain Liable Under Receivables..........................................................7
         3.8.  Collateral Account; Deposit Accounts...............................................................7

ARTICLE IV

                    PROVISIONS CONCERNING ALL COLLATERAL..........................................................8

</TABLE>
                                      (i)

<PAGE>

<TABLE>

       <S>                                                                                                    <C>
         4.1.  Protection of Assignee's Security..................................................................8
         4.2.  Warehouse Receipts Non-negotiable..................................................................8
         4.3.  Further Actions....................................................................................9
         4.4.  Financing Statements...............................................................................9

ARTICLE V

                    REMEDIES UPON OCCURRENCE OF AN EVENT OF DEFAULT...............................................9

         5.1.  Remedies; Obtaining the Collateral Upon Default....................................................9
         5.2.  Remedies; Disposition of the Collateral...........................................................11
         5.3.  Waiver of Claims..................................................................................11
         5.4.  Application of Proceeds...........................................................................12
         5.5.  Remedies Cumulative...............................................................................13
         5.6.  Discontinuance of Proceedings.....................................................................13

ARTICLE VI

                    INDEMNITY....................................................................................13

         6.1.  Indemnity.........................................................................................13
         6.2.  Indemnity Obligations Secured by Collateral; Survival.............................................15

ARTICLE VII

                    DEFINITIONS..................................................................................15

ARTICLE VIII

                    MISCELLANEOUS................................................................................18

         8.1.  Notices...........................................................................................18
         8.2.  Waiver; Amendment.................................................................................19
         8.3.  Obligations Absolute..............................................................................19
         8.4.  Successors and Assigns............................................................................19
         8.5.  Headings Descriptive..............................................................................19
         8.6.  Governing Law.....................................................................................19
         8.7.  Assignor's Duties.................................................................................19
         8.8.  Termination; Release..............................................................................19
         8.9.  Counterparts......................................................................................20
         8.10.  Severability.....................................................................................20
         8.11.  Additional Assignors.............................................................................20

</TABLE>
                                      (ii)

<PAGE>

ANNEX A     Schedule of Chief Executive Offices and Other Record Locations
ANNEX B     Schedule of Inventory and Equipment Locations
ANNEX C     Schedule of Legal Names, Organizational Identification Numbers and
            Trade and Fictitious Names
ANNEX D     Schedule of Jurisdictions and Types of Organizations
ANNEX E     Depositary Accounts

<PAGE>
                                                                       EXHIBIT F

                              SUBSIDIARIES GUARANTY

         SUBSIDIARIES  GUARANTY,  dated  as of  August  __,  2001  (as  amended,
modified or supplemented  from time to time, this  "Guaranty"),  made by each of
the  undersigned  guarantors  (each a  "Guarantor,"  and together with any other
entity that  becomes a guarantor  hereunder  pursuant to Section 26 hereof,  the
"Guarantors"). Except as otherwise defined herein, capitalized terms used herein
and defined in the Credit  Agreement (as defined  below) shall be used herein as
therein defined.

                              W I T N E S S E T H :

         WHEREAS,  Uniroyal Technology Corporation (the "Borrower"),  and EMCORE
Corporation,  as Lender (the  "Lender"),  have entered into a Credit  Agreement,
dated as of August __, 2001 (as amended,  modified, or supplemented from time to
time,  the  "Credit  Agreement"),  providing  for  the  making  of a Loan to the
Borrower  as  contemplated  therein  (the Lender is herein  called the  "Secured
Creditor");

         WHEREAS,  each  Guarantor  is a direct or  indirect  Subsidiary  of the
Borrower;

         WHEREAS,  it is a condition  to the making of the Loan to the  Borrower
under the Credit Agreement that each Guarantor shall have executed and delivered
this Guaranty; and

         WHEREAS, each Guarantor will obtain benefits from the incurrence of the
Loan to the Borrower  under the Credit  Agreement and,  accordingly,  desires to
execute  this  Guaranty  in order to  satisfy  the  condition  described  in the
preceding paragraph;

         NOW,  THEREFORE,  in  consideration of the foregoing and other benefits
accruing to each  Guarantor,  the receipt  and  sufficiency  of which are hereby
acknowledged,  each  Guarantor  hereby makes the following  representations  and
warranties  to the Secured  Creditor and hereby  covenants  and agrees with each
Secured Creditor as follows:

         1. Each Guarantor, jointly and severally,  irrevocably,  absolutely and
unconditionally  guarantees: to the Secured Creditor the full and prompt payment
when due (whether at the stated  maturity,  by acceleration or otherwise) of (x)
the principal of, premium,  if any, and interest on the Notes issued by, and the
Loans  made to,  the  Borrower  under the  Credit  Agreement,  and (y) all other
obligations  (including  obligations  which,  but for the  automatic  stay under
Section  362(a) of the  Bankruptcy  Code,  would  become due),  liabilities  and
indebtedness  owing by the  Borrower  to the Secured  Creditor  under the Credit
Agreement  and each  other  Credit  Document  to which the  Borrower  is a party
(including, without limitation,  indemnities, and interest thereon), whether now
existing or hereafter  incurred under,  arising out of or in connection with the
Credit  Agreement and any such other Credit Document and the due performance and
compliance  by the Borrower  with all of the terms,  conditions  and  agreements
contained in all such Credit Documents (all such principal,  premium,  interest,
liabilities,  indebtedness and obligations being herein  collectively called the
"Credit Document Obligations" or the "Guaranteed  Obligations").  Each Guarantor
understands,  agrees and  confirms  that the Secured  Creditor  may enforce this
Guaranty  up to the full  amount  of the  Guaranteed  Obligations  against  such
Guarantor without proceeding against any other Guarantor, the Borrower,  against
any  security  for the  Guaranteed  Obligations,  or under  any  other  guaranty
covering all or a portion of the Guaranteed Obligations.

         2.    Additionally,    each    Guarantor,    jointly   and   severally,
unconditionally,  absolutely and irrevocably,  guarantees the payment of any and
all  Guaranteed  Obligations  whether or not due or payable by the Borrower upon
the  occurrence  in respect of the  Borrower of any of the events  specified  in
Section  8.05 of the

<PAGE>
                                                                       Exhibit F
                                                                          Page 2

Credit Agreement,  and unconditionally  and irrevocably,  jointly and severally,
promises to pay such Guaranteed  Obligations to the Secured Creditor,  or order,
on demand, in legal tender of the United States.  This Guaranty shall constitute
a guaranty of payment, and not of collection.

         3. The liability of each Guarantor  hereunder is primary,  absolute and
unconditional  and is  exclusive  and  independent  of any security for or other
guaranty of the indebtedness of the Borrower whether executed by such Guarantor,
any  other  Guarantor,  any  other  guarantor  or by any  other  party,  and the
liability of each Guarantor  hereunder  shall not be affected or impaired by any
circumstance or occurrence  whatsoever  (other than the indefeasible  payment in
full  in  cash  of  all  of  the  Guaranteed  Obligations),  including,  without
limitation: (a) any direction as to application of payment by the Borrower or by
any other party,  (b) any other  continuing or other  guaranty,  undertaking  or
maximum  liability  of a guarantor  or of any other  party as to the  Guaranteed
Obligations,  (c) any payment on or in reduction  of any such other  guaranty or
undertaking, (d) any dissolution, termination or increase, decrease or change in
personnel by the Borrower,  (e) any payment made to any Secured  Creditor on the
indebtedness  which any Secured  Creditor repays the Borrower  pursuant to court
order in any bankruptcy, reorganization, arrangement, moratorium or other debtor
relief  proceeding,  and each  Guarantor  waives  any right to the  deferral  or
modification of its obligations hereunder by reason of any such proceeding,  (f)
any action or  inaction by the Secured  Creditor  as  contemplated  in Section 6
hereof or (g) any  invalidity,  irregularity or  unenforceability  of all or any
part of the Guaranteed Obligations or of any security therefor.

         4. The  obligations of each Guarantor  hereunder are independent of the
obligations of any other Guarantor,  any other guarantor or the Borrower,  and a
separate action or actions may be brought and prosecuted  against each Guarantor
whether  or not  action  is  brought  against  any  other  Guarantor,  any other
guarantor  or the  Borrower  and whether or not any other  Guarantor,  any other
guarantor  or the  Borrower  be  joined  in any such  action  or  actions.  Each
Guarantor  waives,  to the fullest extent  permitted by law, the benefits of any
statute of  limitations  affecting  its liability  hereunder or the  enforcement
thereof.  Any payment by the Borrower or other  circumstance  which  operates to
toll any statute of  limitations  as to the Borrower  shall  operate to toll the
statute of limitations as to each Guarantor.

         5. Each  Guarantor  hereby waives (to the fullest  extent  permitted by
applicable  laws)  notice  of  acceptance  of this  Guaranty  and  notice of any
liability to which it may apply, and waives promptness,  diligence, presentment,
demand  of  payment,  protest,  notice of  dishonor  or  nonpayment  of any such
liabilities,  suit or  taking  of other  action  by the  Lender  or the  Secured
Creditor against,  and any other notice to, any party liable thereon  (including
such Guarantor, any other Guarantor, any other guarantor or the Borrower).

         6. The Secured  Creditor  (except as shall be  required  by  applicable
statute and cannot be waived) may at any time and from time to time  without the
consent of, or notice to, any Guarantor,  without  incurring  responsibility  to
such Guarantor, without impairing or releasing the obligations of such Guarantor
hereunder, upon or without any terms or conditions and in whole or in part:

         (a) change the  manner,  place or terms of payment of,  and/or  change,
increase or extend the time of payment of, renew or alter, any of the Guaranteed
Obligations  (including any increase or decrease in the rate of interest thereon
or the  principal  amount  thereof),  any security  therefor,  or any  liability
incurred directly or indirectly in respect thereof, and the guaranty herein made
shall apply to the Guaranteed  Obligations as so changed,  extended,  renewed or
altered;

         (b)  take  and  hold  security  for  the  payment  of  the   Guaranteed
Obligations and sell,  exchange,  release,  surrender,  impair,  realize upon or
otherwise deal with in any manner and in any order any property by whomsoever at
any time pledged or mortgaged to secure, or howsoever  securing,  the Guaranteed
Obligations  or any  liabilities  (including  any of those  hereunder)  incurred
directly or  indirectly  in respect  thereof or hereof,  and/or any offset there
against;
<PAGE>
                                                                       Exhibit F
                                                                          Page 3

         (c)  exercise  or  refrain  from  exercising  any  rights  against  the
Borrower,  any other Credit Party,  any  Subsidiary  thereof or otherwise act or
refrain from acting;

         (d) release or substitute any one or more endorsers,  Guarantors, other
guarantors, the Borrower or other obligors;

         (e)  settle  or  compromise  any of  the  Guaranteed  Obligations,  any
security therefor or any liability  (including any of those hereunder)  incurred
directly or indirectly in respect  thereof or hereof,  and may  subordinate  the
payment of all or any part thereof to the payment of any liability  (whether due
or not) of the  Borrower to  creditors  of the  Borrower  other than the Secured
Creditor;

         (f) apply any sums by  whomsoever  paid or  howsoever  realized  to any
liability or liabilities of the Borrower to the Secured  Creditor  regardless of
what liabilities of the Borrower remain unpaid;

         (g) consent to or waive any breach of, or any act,  omission or default
under, the Credit Documents or any of the instruments or agreements  referred to
therein, or otherwise amend, modify or supplement the Credit Documents or any of
such other instruments or agreements;

         (h) act or fail to act in any manner referred to in this Guaranty which
may deprive such Guarantor of its right to  subrogation  against the Borrower to
recover full indemnity for any payments made pursuant to this Guaranty; and/or

         (i) take any other  action  which  would,  under  otherwise  applicable
principles  of common law,  give rise to a legal or equitable  discharge of such
Guarantor from its liabilities under this Guaranty.

         7. This Guaranty is a continuing  one and all  liabilities  to which it
applies or may apply under the terms  hereof shall be  conclusively  presumed to
have been  created in  reliance  hereon.  No failure or delay on the part of any
Secured  Creditor in exercising any right,  power or privilege  hereunder  shall
operate as a waiver  thereof,  nor shall any single or partial  exercise  of any
right,  power or  privilege  hereunder  preclude  any other or further  exercise
thereof or the exercise of any other right,  power or privilege.  The rights and
remedies  herein  expressly  specified are  cumulative  and not exclusive of any
rights or remedies which any Secured Creditor would otherwise have. No notice to
or demand on any Guarantor in any case shall entitle such Guarantor to any other
further  notice or demand in  similar or other  circumstances  or  constitute  a
waiver of the rights of any Secured  Creditor to any other or further  action in
any circumstances  without notice or demand. It is not necessary for any Secured
Creditor to inquire into the capacity or powers of the Borrower or the officers,
directors, partners or agents acting or purporting to act on its behalf, and any
indebtedness  made or created in reliance  upon the  professed  exercise of such
powers shall be guaranteed hereunder.

         8.  Any  indebtedness  of the  Borrower  now or  hereafter  held by any
Guarantor  is hereby  subordinated  to the  indebtedness  of the Borrower to the
Secured Creditor, and such indebtedness of the Borrower to any Guarantor, if the
Collateral Agent, after the occurrence and during the continuance of an Event of
Default,  so  requests,  shall  be  collected,  enforced  and  received  by such
Guarantor  as trustee for the Secured  Creditor  and be paid over to the Secured
Creditor on account of the indebtedness of the Borrower to the Secured Creditor,
but without affecting or impairing in any manner the liability of such Guarantor
under the other provisions of this Guaranty.  Without limiting the generality of
the foregoing,  each Guarantor  hereby agrees with the Secured  Creditor that it
will not exercise any right of  subrogation  which it may at any time  otherwise
have as a result of this Guaranty (whether contractual, under Section 509 of the
Bankruptcy  Code or  otherwise)  until  all  Guaranteed  Obligations  have  been
irrevocably paid in full in cash.

         9. (a) Each Guarantor  waives any right (except as shall be required by
applicable  law and cannot be waived) to require  the Secured  Creditor  to: (i)
proceed against the Borrower,  any other  Guarantor,
<PAGE>
                                                                       Exhibit F
                                                                          Page 4

any other  guarantor of the  Guaranteed  Obligations  or any other  party;  (ii)
proceed  against or  exhaust  any  security  held from the  Borrower,  any other
Guarantor, any other guarantor of the Guaranteed Obligations or any other party;
or (iii) pursue any other  remedy in the Secured  Creditor's  power  whatsoever.
Each Guarantor  waives any defense based on or arising out of any defense of the
Borrower, any other Guarantor, any other guarantor of the Guaranteed Obligations
or any other party  other than  payment in full of the  Guaranteed  Obligations,
including,  without  limitation,  any  defense  based on or  arising  out of the
disability  of the Borrower,  any other  Guarantor,  any other  guarantor of the
Guaranteed  Obligations  or any  other  party,  or the  unenforceability  of the
Guaranteed Obligations or any part thereof from any cause, or the cessation from
any cause of the  liability  of the  Borrower  other than payment in full of the
Guaranteed Obligations.  The Secured Creditor may, at its election, foreclose on
any security held by the Collateral Agent by one or more judicial or nonjudicial
sales, whether or not every aspect of any such sale is commercially  reasonable,
or exercise any other right or remedy the Secured  Creditor may have against the
Borrower or any other party, or any security,  without affecting or impairing in
any way the  liability  of any  Guarantor  hereunder  except to the  extent  the
Guaranteed Obligations have been paid in full in cash. Each Guarantor waives any
defense  arising out of any such election by the Secured  Creditor,  even though
such election  operates to impair or extinguish  any right of  reimbursement  or
subrogation or other right or remedy of such  Guarantor  against the Borrower or
any other party or any security.

         (b) Each Guarantor  waives all  presentments,  demands for performance,
protests and notices, including, without limitation,  notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this Guaranty,
and  notices  of the  existence,  creation  or  incurring  of new or  additional
indebtedness.  Each Guarantor assumes all  responsibility  for being and keeping
itself  informed of the Borrower's  financial  condition and assets,  and of all
other  circumstances  bearing  upon the  risk of  nonpayment  of the  Guaranteed
Obligations  and the nature,  scope and extent of the risks which such Guarantor
assumes and incurs hereunder, and agrees that the Secured Creditor shall have no
duty to  advise  any  Guarantor  of  information  known to them  regarding  such
circumstances or risks.

         10. The Secured  Creditor agrees that this Guaranty may not be enforced
against any director,  officer, employee,  partner, member or stockholder of any
Guarantor  (except to the extent such partner,  member or  stockholder is also a
Guarantor hereunder).

         11. In order to  induce  the  Lender  to make the Loan to the  Borrower
pursuant  to the Credit  Agreement,  each  Guarantor  represents,  warrants  and
covenants that:

         (a)  Such  Guarantor  (i)  is a duly  organized  and  validly  existing
corporation,  partnership or limited liability  company,  as the case may be, in
good standing under the laws of the jurisdiction of its  organization,  (ii) has
the corporate,  partnership or limited liability company power and authority, as
the case may be, to own its  property and assets and to transact the business in
which it is engaged and presently proposes to engage and (iii) is duly qualified
and is authorized  to do business and is in good  standing in each  jurisdiction
where the  conduct  of its  business  requires  such  qualification  except  for
failures to be so qualified  which,  either  individually  or in the  aggregate,
could not reasonably be expected to have a Material Adverse Effect.

         (b) Such Guarantor has the corporate,  partnership or limited liability
company power and authority, as the case may be, to execute, deliver and perform
the terms and  provisions  of this  Guaranty and each other  Credit  Document to
which it is a party  and has  taken  all  necessary  corporate,  partnership  or
limited  liability  company  action,  as the  case  may  be,  to  authorize  the
execution,  delivery and  performance by it of this Guaranty and each such other
Credit  Document.  Such  Guarantor has duly executed and delivered this Guaranty
and each other  Credit  Document to which it is a party,  and this  Guaranty and
each such  other  Credit  Document  constitutes  the  legal,  valid and  binding
obligation of such Guarantor enforceable in accordance with its terms, except to
the  extent  that  the  enforceability  hereof  or  thereof  may be  limited  by
applicable bankruptcy,

<PAGE>
                                                                       Exhibit F
                                                                          Page 5

insolvency, reorganization, moratorium or other similar laws generally affecting
creditors' rights and by equitable principles (regardless of whether enforcement
is sought in equity or at law).

         (c) Neither the execution, delivery or performance by such Guarantor of
this  Guaranty  or any  other  Credit  Document  to  which  it is a  party,  nor
compliance  by it with the terms and  provisions  hereof and  thereof,  will (i)
contravene any provision of any applicable law,  statute,  rule or regulation or
any applicable  order,  writ,  injunction or decree of any court or governmental
instrumentality, (ii) conflict with or result in any breach of any of the terms,
covenants, conditions or provisions of, or constitute a default under, or result
in the creation or  imposition  of (or the  obligation  to create or impose) any
Lien  (except  pursuant to the Security  Documents)  upon any of the property or
assets of such Guarantor or any of its Subsidiaries pursuant to the terms of any
indenture,  mortgage,  deed of trust, loan agreement,  credit agreement,  or any
other material agreement,  contract or instrument to which such Guarantor or any
of its  Subsidiaries  is a party or by which it or any of its property or assets
is bound or to which it may be subject or (iii)  violate  any  provision  of the
certificate of incorporation or by-laws (or equivalent organizational documents)
of such Guarantor or any of its Subsidiaries.

         (d) No order, consent, approval,  license,  authorization or validation
of, or filing,  recording or registration  with (except as have been obtained or
made),  or exemption by, any  governmental  or public body or authority,  or any
subdivision  thereof,  is required to  authorize,  or is required  for,  (i) the
execution,  delivery and  performance  of this Guaranty by such Guarantor or any
other Credit  Document to which such  Guarantor is a party or (ii) the legality,
validity,  binding effect or enforceability of this Guaranty or any other Credit
Document to which such Guarantor is a party.

         (e) There are no  actions,  suits or  proceedings  pending  or, to such
Guarantor's knowledge, threatened (i) with respect to this Guaranty or any other
Credit  Document to which such Guarantor is a party or (ii) with respect to such
Guarantor  or  any of  its  Subsidiaries  that,  either  individually  or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

         12. Each  Guarantor  covenants and agrees that on and after the Closing
Date and  until  such time as no Note  remains  outstanding  and all  Guaranteed
Obligations  (other  than  indemnity  obligations  which  are not  then  due and
payable) have been paid in full, such Guarantor will comply, and will cause each
of its Subsidiaries to comply, with all of the applicable provisions,  covenants
and agreements  contained in Sections 6 and 7 of the Credit Agreement,  and will
take,  or will  refrain  from  taking,  as the case may be, all actions that are
necessary  to be  taken  or not  taken  so  that it is not in  violation  of any
provision,  covenant  or  agreement  contained  in  Section 6 or 7 of the Credit
Agreement,  and so that no Default or Event of Default, is caused by the actions
of such Guarantor or any of its Subsidiaries.

         13.  The  Guarantors  hereby  jointly  and  severally  agree to pay all
reasonable   out-of-pocket  costs  and  expenses  of  the  Secured  Creditor  in
connection  with  the  enforcement  of this  Guaranty  in  connection  with  any
amendment,  waiver or consent relating hereto  (including in each case,  without
limitation,  the reasonable fees and  disbursements  of counsel  employed by the
Secured Creditor).

         14.  This  Guaranty  shall  be  binding  upon  each  Guarantor  and its
successors  and assigns  and shall inure to the benefit of the Secured  Creditor
and its successors and assigns.

         15.  Neither  this  Guaranty nor any  provision  hereof may be changed,
waived,  discharged  or  terminated  except  with the  written  consent  of each
Guarantor  directly affected thereby and with the written consent of the Secured
Creditor at all times prior to the time on which all Credit Document Obligations
have been paid in full.
<PAGE>
                                                                       Exhibit F
                                                                          Page 6

         16. Each Guarantor acknowledges that an executed (or conformed) copy of
each of the Credit Documents has been made available to a senior officer of such
Guarantor and such officer is familiar with the contents thereof.

         17. In addition to any rights now or hereafter granted under applicable
law  (including,  without  limitation,  Section  151 of the New York  Debtor and
Secured Creditor Law) and not by way of limitation of any such rights,  upon the
occurrence and during the  continuance of an Event of Default (such term to mean
and  include any "Event of  Default"  as defined in the Credit  Agreement),  the
Secured Creditor is hereby authorized, at any time or from time to time, without
notice to any Guarantor or to any other Person,  any such notice being expressly
waived, to set off and to appropriate and apply any and all deposits (general or
special)  and any other  indebtedness  at any time held or owing by such Secured
Creditor to or for the credit or the account of such  Guarantor,  against and on
account of the  obligations  and  liabilities  of such Guarantor to such Secured
Creditor  under this  Guaranty,  irrespective  of  whether  or not such  Secured
Creditor  shall have made any demand  hereunder and although  said  obligations,
liabilities,  deposits  or  claims,  or any of  them,  shall  be  contingent  or
unmatured.

         18. All notices,  requests,  demands or other  communications  pursuant
hereto shall be sent or delivered by mail, telegraph,  telex, telecopy, cable or
overnight  courier service and all such notices and  communications  shall, when
mailed,  telegraphed,  telexed,  telecopied,  or  cabled  or sent  by  overnight
courier,  be effective when  deposited in the mails,  delivered to the telegraph
company,  cable  company or  overnight  courier,  as the case may be, or sent by
telex or  telecopier  and when mailed shall be  effective  three  Business  Days
following  deposit in the mail with  proper  postage,  except  that  notices and
communications  to the Secured  Creditor or any Guarantor shall not be effective
until received by the Secured  Creditor or such  Guarantor,  as the case may be.
All notices and other  communications  shall be in writing and addressed to such
party at (i) in the case of the Lender, as provided in the Credit Agreement, and
(ii) in the case of any Guarantor,  as provided in the Security Agreement; or in
any case at such other address as any of the Persons  listed above may hereafter
notify the others in writing.

         19. If claim is ever made upon any Secured  Creditor  for  repayment or
recovery  of any amount or amounts  received  in payment or on account of any of
the Guaranteed Obligations and any of the aforesaid payees repays all or part of
said  amount  by  reason  of (i) any  judgment,  decree or order of any court or
administrative  body having  jurisdiction over such payee or any of its property
or (ii) any  settlement or  compromise of any such claim  effected by such payee
with any such  claimant  (including  the  Borrower)  then and in such event each
Guarantor agrees that any such judgment, decree, order, settlement or compromise
shall be binding upon such Guarantor,  notwithstanding  any revocation hereof or
other  instrument  evidencing any liability of the Borrower,  and such Guarantor
shall be and remain liable to the aforesaid  payees  hereunder for the amount so
repaid or  recovered  to the same extent as if such amount had never  originally
been received by any such payee.

         20. (a) THIS  GUARANTY  AND THE RIGHTS AND  OBLIGATIONS  OF THE SECURED
CREDITORS AND OF THE UNDERSIGNED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. Any legal action or proceeding
with  respect  to this  Guaranty  or any  other  Credit  Document  to which  any
Guarantor is a party may be brought in the courts of the State of New York or of
the United States of America for the Southern  District of New York in each case
located  in the  City of New  York,  and,  by  execution  and  delivery  of this
Guaranty, each Guarantor hereby irrevocably accepts for itself and in respect of
its property,  generally and unconditionally,  the jurisdiction of the aforesaid
courts. Each Guarantor hereby further irrevocably waives any claim that any such
court lacks personal  jurisdiction over such Guarantor,  and agrees not to plead
or claim in any legal action or proceeding  with respect to this Guaranty or any
other Credit  Document to which such  Guarantor is a party brought in any of the
aforesaid  courts  that any such court  lacks  personal  jurisdiction  over such
Guarantor. Each Guarantor further irrevocably consents to the service of process
out of any of the

<PAGE>
                                                                       Exhibit F
                                                                          Page 7

aforementioned  courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail,  postage prepaid,  to such Guarantor at
its address set forth  opposite  its  signature  below,  such  service to become
effective 30 days after such mailing.  Each Guarantor hereby  irrevocably waives
any  objection  to such  service of process and further  irrevocably  waives and
agrees not to plead or claim in any action or proceeding  commenced hereunder or
under any other  Credit  Document to which such  Guarantor  is a party that such
service of process was in any way invalid or  ineffective.  Nothing herein shall
affect the right of any of the Secured  Creditors to serve  process in any other
manner  permitted by law or to commence legal  proceedings or otherwise  proceed
against each Guarantor in any other jurisdiction.

         (b) Each  Guarantor  hereby  irrevocably  waives (to the fullest extent
permitted by applicable law) any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid  actions or proceedings  arising out
of or in  connection  with this  Guaranty or any other Credit  Document to which
such Guarantor is a party brought in the courts  referred to in clause (a) above
and hereby  further  irrevocably  waives and agrees not to plead or claim in any
such court  that such  action or  proceeding  brought in any such court has been
brought in an inconvenient forum.

         (c) EACH GUARANTOR AND EACH SECURED  CREDITOR (BY ITS ACCEPTANCE OF THE
BENEFITS OF THIS GUARANTY)  HEREBY  IRREVOCABLY  WAIVES ALL RIGHTS TO A TRIAL BY
JURY IN ANY ACTION,  PROCEEDING  OR  COUNTERCLAIM  ARISING OUT OF OR RELATING TO
THIS GUARANTY,  THE OTHER CREDIT DOCUMENTS TO WHICH SUCH GUARANTOR IS A PARTY OR
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

         21.  In the  event  that  all  of  the  capital  stock  of one or  more
Guarantors is sold or otherwise disposed of or liquidated in compliance with the
requirements  of  Section  7.02  of the  Credit  Agreement  and  the  applicable
provisions  of the other  Secured  Debt  Agreements  (as defined in the Security
Agreement)  (or such sale or other  disposition  has been approved in writing by
the Lender and the proceeds of such sale, disposition or liquidation are applied
in  accordance  with the  provisions  of the  Credit  Agreement,  to the  extent
applicable,  such  Guarantor  shall  upon  consummation  of such  sale or  other
disposition  (except  to the  extent  that  such sale or  disposition  is to the
Borrower  or  another  Subsidiary   thereof)  be  released  from  this  Guaranty
automatically  and without  further action and this Guaranty  shall,  as to each
such Guarantor or Guarantors, terminate, and have no further force or effect (it
being  understood  and  agreed  that the sale of one or more  Persons  that own,
directly or  indirectly,  all of the  capital  stock of any  Guarantor  shall be
deemed to be a sale of such Guarantor for the purposes of this Section 21).

         22. At any time a payment in respect of the  Guaranteed  Obligations is
made under this Guaranty,  the right of contribution  of each Guarantor  against
each  other  Guarantor  shall  be  determined  as  provided  in the  immediately
following  sentence,  with the right of  contribution  of each  Guarantor  to be
revised and restated as of each date on which a payment (a  "Relevant  Payment")
is made on the Guaranteed  Obligations  under this Guaranty.  At any time that a
Relevant  Payment is made by a Guarantor that results in the aggregate  payments
made by such Guarantor in respect of the Guaranteed Obligations to and including
the  date  of the  Relevant  Payment  exceeding  such  Guarantor's  Contribution
Percentage (as defined  below) of the aggregate  payments made by all Guarantors
in  respect  of the  Guaranteed  Obligations  to and  including  the date of the
Relevant  Payment  (such  excess,  the  "Aggregate  Excess  Amount"),  each such
Guarantor  shall have a right of  contribution  against each other Guarantor who
has made no payments or payments in respect of the Guaranteed Obligations to and
including the date of the Relevant Payment in an aggregate amount less than such
other Guarantor's  Contribution Percentage of the aggregate payments made to and
including the date of the Relevant  Payment by all  Guarantors in respect of the
Guaranteed  Obligations  (the aggregate  amount of such deficit,  the "Aggregate
Deficit  Amount") in an amount equal to (x) a fraction the numerator of which is
the Aggregate  Excess Amount of such  Guarantor and the  denominator of which is
the Aggregate  Excess Amount of all  Guarantors  multiplied by (y) the Aggregate
Deficit  Amount of such other  Guarantor.  A Guarantor's  right of  contribution
pursuant to the preceding sentences shall arise at the time of each computation,
subject  to

<PAGE>
                                                                       Exhibit F
                                                                          Page 8

adjustment to the time of each computation; provided, that no Guarantor may take
any action to enforce such right until the  Guaranteed  Obligations  (other than
indemnity  obligations which are not then due and payable) have been irrevocably
paid in full in cash, it being  expressly  recognized  and agreed by all parties
hereto  that any  Guarantor's  right of  contribution  arising  pursuant to this
Section 22 against any other Guarantor shall be expressly junior and subordinate
to  such  other  Guarantor's  obligations  and  liabilities  in  respect  of the
Guaranteed  Obligations and any other obligations owing under this Guaranty.  As
used in this Section 22: (i) each Guarantor's  "Contribution  Percentage"  shall
mean the percentage  obtained by dividing (x) the Adjusted Net Worth (as defined
below)  of such  Guarantor  by (y)  the  aggregate  Adjusted  Net  Worth  of all
Guarantors;  (ii) the  "Adjusted  Net  Worth" of each  Guarantor  shall mean the
greater of (x) the Net Worth (as defined  below) of such Guarantor and (y) zero;
and (iii) the "Net Worth" of each  Guarantor  shall mean the amount by which the
fair  salable  value of such  Guarantor's  assets  on the  date of any  Relevant
Payment exceeds its existing debts and other liabilities  (including  contingent
liabilities,  but without  giving effect to any Guaranteed  Obligations  arising
under this Guaranty) on such date. All parties hereto  recognize and agree that,
except for any right of contribution  arising  pursuant to this Section 22, each
Guarantor who makes any payment in respect of the Guaranteed  Obligations  shall
have no right of  contribution  or  subrogation  against any other  Guarantor in
respect of such  payment  until all of the  Guaranteed  Obligations  (other than
indemnity  obligations which are not then due and payable) have been irrevocably
paid in full in cash. Each of the Guarantors  recognizes and  acknowledges  that
the rights to contribution  arising hereunder shall constitute an asset in favor
of the party entitled to such contribution.  In this connection,  each Guarantor
has the right to waive its  contribution  right  against  any  Guarantor  to the
extent  that after  giving  effect to such waiver such  Guarantor  would  remain
solvent, in the determination of the Required Lenders.

         23. Each  Guarantor and the Secured  Creditor (by its acceptance of the
benefits of this  Guaranty)  hereby  confirms that it is its intention that this
Guaranty not constitute a fraudulent  transfer or conveyance for purposes of the
Bankruptcy Code, the Uniform Fraudulent Conveyance Act of any similar Federal or
state law. To effectuate the foregoing intention, each Guarantor and the Secured
Creditor (by its acceptance of the benefits of this Guaranty) hereby irrevocably
agrees that the Guaranteed  Obligations  guaranteed by such  Guarantor  shall be
limited to such amount as will,  after giving effect to such maximum  amount and
all other  (contingent  or otherwise)  liabilities  of such  Guarantor  that are
relevant  under such laws and after giving effect to any rights to  contribution
pursuant to any  agreement  providing for an equitable  contribution  among such
Guarantor and other  Guarantors,  result in the  Guaranteed  Obligations of such
Guarantor  in  respect of such  maximum  amount not  constituting  a  fraudulent
transfer or conveyance.

         24. This Guaranty may be executed in any number of counterparts  and by
the different  parties  hereto on separate  counterparts,  each of which when so
executed and  delivered  shall be an original,  but all of which shall  together
constitute one and the same  instrument.  A set of counterparts  executed by all
the parties hereto shall be lodged with the Guarantors and the Secured Creditor.

         25. All payments made by any Guarantor  hereunder  will be made without
setoff, counterclaim or other defense and on the same basis as payments are made
by the Borrower under Sections 3.03 and 3.04 of the Credit Agreement.

         26. It is  understood  and agreed that any  Subsidiary  of the Borrower
that is required to execute a counterpart of this Guaranty after the date hereof
pursuant to the Credit Agreement shall become a Guarantor hereunder by executing
a counterpart hereof and delivering the same to the Secured Creditor.

                                      * * *
<PAGE>
         IN WITNESS  WHEREOF,  each  Guarantor  has caused  this  Guaranty to be
executed and delivered as of the date first above written.

                                         Uniroyal Compound Semiconductors, Inc.,
                                         as a Guarantor

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

                                         Uniroyal Optoelectronics, LLC,
                                         as a Guarantor

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

                                         Sterling Semiconductor, Inc.,
                                         as a Guarantor

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

                                         Uniroyal Optoelectronics Service
                                         Company, Inc., as a Guarantor

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

                                         NorLux Corp.,
                                         as a Guarantor

                                         By
                                           -------------------------------------
                                           Title:
<PAGE>
                                                                       Exhibit F
                                                                         Page 10

Accepted and Agreed to:

EMCORE CORPORATION,
  as Lender and as Secured Creditor

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

<PAGE>
                                                                       EXHIBIT G

                          FORM OF SOLVENCY CERTIFICATE

         I, the undersigned,  the Chief Financial Officer of Uniroyal Technology
Corporation (the  "Borrower"),  do hereby certify in such capacity and on behalf
of the Borrower that:

         1. This  Certificate  is  furnished  to the Lender  pursuant to Section
4.12(i) of the Credit Agreement, dated as of August __, 2001, among the Borrower
and EMCORE  Corporation,  as Lender (the "Lender" (such Credit Agreement,  as in
effect  on the  date  of this  Certificate,  being  herein  called  the  "Credit
Agreement").  Unless otherwise  defined herein,  capitalized  terms used in this
Certificate shall have the meanings set forth in the Credit Agreement.

         2. For  purposes  of this  Certificate,  the terms below shall have the
following definitions:

         (a)      "Fair Value"

                  The amount at which the assets,  in their entirety (on a going
                  concern  basis),  of each  of the  Borrower  on a  stand-alone
                  basis, and the Borrower and its Subsidiaries taken as a whole,
                  would  change  hands  between  a  willing  buyer and a willing
                  seller, within a commercially  reasonable period of time, each
                  having  reasonable  knowledge  of  the  relevant  facts,  with
                  neither being under any compulsion to act.

         (b)      "Present Fair Salable Value"

                  The amount that could be obtained  by an  independent  willing
                  seller from an independent willing buyer if the assets of each
                  of the Borrower on a stand-alone  basis,  and the Borrower and
                  its Subsidiaries  taken as a whole (on a going concern basis),
                  are sold  with  reasonable  promptness  under  normal  selling
                  conditions in a current market.

         (c)      "New Financing"

                  The  Indebtedness  incurred or to be incurred by the  Borrower
                  and  its  Subsidiaries  under  the  Documents  and  all  other
                  financing  contemplated by the Documents  (including,  without
                  limitation,  the Credit  Documents,  in each case after giving
                  effect  to the  Transaction  and  all  financing  contemplated
                  therewith.

         (d)      "Stated Liabilities"

                  The recorded liabilities  (including  contingent  liabilities)
                  that would be recorded in accordance  with generally  accepted
                  accounting   principles  ("GAAP")  of  the  Borrower  and  its
                  Subsidiaries  at  October  1,  2000  after  giving  effect  to
                  Transaction,  determined in accordance with GAAP  consistently
                  applied,  together  with (i) the net change in long-term  debt
                  (including current maturities) between October 1, 2000 and the
                  date hereof and (ii)  without  duplication,  the amount of all
                  New Financing.

         (e)      "Identified Contingent Liabilities"

                  The maximum estimated amount of liabilities  reasonably likely
                  to  result  from  pending  litigation,   asserted  claims  and
                  assessments,  guaranties, uninsured risks and other contingent
                  liabilities  of each of the Borrower on a  stand-alone  basis,
                  and the Borrower and its Subsidiaries  taken as a whole, after
                  giving effect to the Transaction (exclusive of such contingent
                  liabilities

<PAGE>
                                                                       Exhibit G
                                                                          Page 2

                  to the extent reflected in Stated Liabilities),  as identified
                  and explained in terms of their nature and estimated magnitude
                  by  responsible  officers  of  the  Borrower  or  any  of  its
                  Subsidiaries  or  that  have  been  identified  as  such by an
                  officer of the Borrower or any of its Subsidiaries.

         (f)      "Will be able to pay its  Stated  Liabilities  and  Identified
                  Contingent Liabilities, as they mature"

                  For the  period  from  the  date  hereof  through  the  stated
                  maturity of all the New  Financing,  each of the Borrower on a
                  stand-alone basis, and the Borrower and its Subsidiaries taken
                  as a whole,  will have sufficient  assets and cash flow to pay
                  its Stated Liabilities and Identified  Contingent  Liabilities
                  as those liabilities mature or otherwise become payable.

         (g)      "Does not have Unreasonably Small Capital"

                  For the  period  from  the  date  hereof  through  the  stated
                  maturity of all the New  Financing,  each of the Borrower on a
                  stand-alone basis, and the Borrower and its Subsidiaries taken
                  as a whole,  after  consummation  of the  Transaction  and all
                  Indebtedness  being  incurred or assumed and Liens  created by
                  the Borrower and its Subsidiaries in connection therewith,  is
                  a going concern and has  sufficient  capital to ensure that it
                  will  continue  to be a going  concern  for such period and to
                  remain a going concern.

         3.  For  purposes  of this  Certificate,  I, or other  officers  of the
Borrower and its Subsidiaries under my direction and supervision, have performed
the following procedures as of and for the periods set forth below.

         (a)      I have reviewed the financial  statements  (including  the pro
                  forma financial statements) referred to in Section 5.05 of the
                  Credit Agreement.

         (b)      I have made inquiries of certain officials of the Borrower and
                  its  Subsidiaries  who have  responsibility  for financial and
                  accounting  matters  regarding (i) the existence and amount of
                  Identified Contingent Liabilities associated with the business
                  of the  Borrower  and its  Subsidiaries  and (ii)  whether the
                  unaudited pro forma consolidated financial statements referred
                  to in paragraph (a) above are in conformity  with GAAP applied
                  on a basis  substantially  consistent with that of the audited
                  financial statements as at October 1, 2000.

         (c)      I have knowledge of and have reviewed to my  satisfaction  the
                  Credit Documents and the other  Documents,  and the respective
                  Schedules  and  Exhibits   thereto   (including  any  fairness
                  opinions delivered in connection therewith).

         (d)      With respect to Identified Contingent Liabilities, I:

         1.       inquired  of  certain   officials  of  the  Borrower  and  its
                  Subsidiaries who have responsibility for legal,  financial and
                  accounting matters as to the existence and estimated liability
                  with respect to all contingent liabilities known to them; and

         2.       confirmed  with officers of the Borrower and its  Subsidiaries
                  that,  to the  best  of  such  officers'  knowledge,  (i)  all
                  appropriate  items were included in Stated  Liabilities or the
                  listing of Identified Contingent Liabilities and that (ii) the
                  amounts relating thereto were the maximum  estimated amount of
                  liabilities  reasonably  likely to result  therefrom as of the
                  date hereof.

         (e)      I have examined the  Projections  which have been delivered to
                  the Lenders and  considered  the effect thereon of any changes
                  since  the  date of the  preparation  thereof  on the  results
                  projected

<PAGE>
                                                                       Exhibit G
                                                                          Page 3

                  therein.  After  such  review,  I  hereby  certify  that in my
                  opinion the  Projections  are reasonable  and the  Projections
                  support the conclusions contained in paragraph 4 below.

         (f)      I have made inquiries of certain  officers of the Borrower and
                  its  Subsidiaries  who  have   responsibility   for  financial
                  reporting and accounting  matters  regarding whether they were
                  aware of any events or conditions that, as of the date hereof,
                  would cause either the Borrower on a stand-alone basis, or the
                  Borrower and its Subsidiaries taken as a whole, in either case
                  after  giving  effect  to  the  Transaction  and  the  related
                  financing  transactions  (including  the incurrence of the New
                  Financing),  to (i) have  assets  with a Fair Value or Present
                  Fair  Salable  Value  that  are less  than  the sum of  Stated
                  Liabilities and Identified Contingent  Liabilities;  (ii) have
                  Unreasonably  Small  Capital;  or (iii) not be able to pay its
                  Stated  Liabilities and Identified  Contingent  Liabilities as
                  they mature or otherwise become payable.

         4. Based on and  subject to the  foregoing,  I, in my  capacity  as the
Chief  Financial  Officer  of the  Borrower,  hereby  certify  on  behalf of the
Borrower that, after giving effect to the Transaction and the related  financing
transactions (including the incurrence of the New Financing),  it is my informed
opinion that (i) the Fair Value and Present Fair Salable  Value of the assets of
each  of  the  Borrower  on a  stand-alone  basis,  and  the  Borrower  and  its
Subsidiaries  taken as a whole,  exceed its Stated  Liabilities  and  Identified
Contingent  Liabilities;  (ii) neither the Borrower on a stand-alone  basis, and
the Borrower  and its  Subsidiaries  taken as a whole,  has  Unreasonably  Small
Capital; and (iii) each of the Borrower on a stand-alone basis, and the Borrower
and  its  Subsidiaries  taken  as a  whole,  will  be  able  to pay  its  Stated
Liabilities and Identified Contingent  Liabilities,  as they mature or otherwise
become payable.

                                      * * *
<PAGE>
                                                                       Exhibit G
                                                                          Page 4

         IN WITNESS WHEREOF, I, solely in my capacity as Chief Financial Officer
of the Borrower, have hereto set my hand this ___ day of _________, 2001.

                                             UNIROYAL TECHNOLOGY CORPORATION

                                             By
                                               --------------------------------
                                               Title:  Executive Vice President,
                                                       Treasurer and Chief
                                                       Financial Officer

<PAGE>
                                                                       EXHIBIT H

                            FORM OF INTERCOMPANY NOTE

                                                                          [Date]

         FOR VALUE RECEIVED,  [NAME OF PAYOR] (the "Payor"),  hereby promises to
pay on demand to the order of  _____________  or its assigns (the  "Payee"),  in
lawful money of the United States of America in immediately  available funds, at
such  location  in the United  States of America as the Payee shall from time to
time designate,  the unpaid  principal  amount of all loans and advances made by
the Payee to the Payor.

         The Payor promises also to pay interest on the unpaid  principal amount
hereof in like money at said office from the date hereof until paid at such rate
per annum as shall be agreed upon from time to time by the Payor and Payee.

         Upon the commencement of any bankruptcy,  reorganization,  arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or
similar  proceeding  of any  jurisdiction  relating  to the  Payor,  the  unpaid
principal  amount  hereof  shall  become  immediately  due and  payable  without
presentment, demand, protest or notice of any kind in connection with this Note.

         This  Note  evidences  certain  permitted   intercompany   Indebtedness
referred to in the Credit  Agreement,  dated as of August __, 2001 (as  amended,
modified  or  supplemented  from  time to time,  the "Term  Credit  Agreement"),
between Uniroyal Technology Corporation (the "Company"), and EMCORE Corporation,
as Lender, and is subject to the terms of the Term Credit Agreement.

         The Payee is hereby authorized to record all loans and advances made by
it to the  Payor  (all of  which  shall  be  evidenced  by this  Note),  and all
repayments  or  prepayments  thereof,  in its books and records,  such books and
records  constituting  prima facie  evidence of the accuracy of the  information
contained therein.

         All payments under this Note shall be made without offset, counterclaim
or deduction of any kind.

         THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW
OF THE STATE OF NEW YORK.

                                       [NAME OF PAYOR]

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

Pay to the order of

------------------------------
[NAME OF PAYEE]

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

<PAGE>
                                                                       EXHIBIT I

                          SHAREHOLDER SUBORDINATED NOTE

$_______________                                              New York, New York
                                                                          [Date]

         FOR  VALUE  RECEIVED,  UNIROYAL  TECHNOLOGY  CORPORATION,  a  New  York
corporation (the "Company"), hereby promises to pay to __________ or [his] [her]
[its] assigns (the "Payee"),  in lawful money of the United States of America in
immediately available funds, at ____________________________,  the principal sum
of _____________ DOLLARS, which amount shall be payable on ______________.4

         [The  Company  promises  also to pay  interest on the unpaid  principal
amount  hereof in like money at said office from the date hereof until paid at a
rate  per  annum   equal  to   _______________,   such   interest   to  be  paid
[semi-annually]  [annually] on  _____________________  [and ___________] of each
year and at maturity hereof.]

         This Note is subject to voluntary  prepayment,  in whole or in part, at
the option of the Company, without premium or penalty.

         This Note is one of the Shareholder  Subordinated  Notes referred to in
the Credit Agreement,  dated as of August __, 2001, by and among the Company and
EMCORE Corporation,  as Lender (as amended,  modified,  supplemented,  extended,
restated,  refinanced,  replaced  or  refunded  from time to time,  the  "Credit
Agreement")  and shall be subject to the provisions  thereof.  Unless  otherwise
defined herein,  all capitalized terms used herein or in Annex A attached hereto
and defined in the Credit Agreement shall have the meaning assigned to such term
in the Credit Agreement.

         Notwithstanding  anything to the contrary  contained in this Note,  the
Payee understands and agrees that the Company shall not be required to make, and
shall not make, any payment of principal, interest or other amounts on this Note
to the  extent  that such  payment  is  prohibited  by the  terms of any  Senior
Indebtedness (as defined in Annex A attached hereto), including, but not limited
to, Sections 7.03 and 7.04 of the Credit Agreement.

         This  Note,  and  the  Company's   obligations   hereunder,   shall  be
subordinate and junior to all  indebtedness of the Company  constituting  Senior
Indebtedness  (as  defined  in Section  1.07 of Annex A attached  hereto) on the
terms and  conditions  set forth in Annex A attached  hereto,  which  Annex A is
herein  incorporated  by reference and made a part hereof as if set forth herein
in its entirety.

         The Company hereby waives presentment, demand, protest or notice of any
kind in connection with this Note.

------------------------
4     Insert a date on or after December 31, 2011.
<PAGE>
                                                                       Exhibit I
                                                                          Page 2

         THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE  WITH AND BE GOVERNED BY THE
LAW OF THE STATE OF NEW YORK.

                                           UNIROYAL TECHNOLOGY CORPORATION

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

<PAGE>
                                                                         ANNEX A

         Section  1.01.   Subordination  of  Liabilities.   Uniroyal  Technology
Corporation (the "Company"),  for itself, its successors and assigns,  covenants
and agrees,  and each holder of the Note to which this Annex A is attached  (the
"Note") by its  acceptance  thereof  likewise  covenants  and  agrees,  that the
payment of the principal of, interest on, and all other amounts owing in respect
of, the Note (the "Subordinated Indebtedness") is hereby expressly subordinated,
to the extent and in the manner  hereinafter  set out,  to the prior  payment in
full in cash of all Senior  Indebtedness  (as  defined  in Section  1.07 of this
Annex A). The provisions of this Annex A shall  constitute a continuing offer to
all persons and other  entities  who, in reliance upon such  provisions,  become
holders of, or continue to hold, Senior Indebtedness, and such persons and other
entities  are made  obligees  hereunder  the same as if their names were written
herein  as such,  and they  and/or  each of them may  proceed  to  enforce  such
provisions.

         Section 1.02. Company Not to Make Payments with Respect to Subordinated
Indebtedness  in  Certain  Circumstances.  (a) Upon the  maturity  of any Senior
Indebtedness  (including  interest thereon or fees or any other amounts owing in
respect thereof),  whether at stated maturity, by acceleration or otherwise, all
Obligations  (as  defined  in  Section  1.07 of this  Annex A) owing in  respect
thereof  shall  first be paid in full in cash  before any payment of any kind or
character,  whether  in cash,  property,  securities  or  otherwise,  is made on
account of the Subordinated Indebtedness.

         (b) Until all Senior Indebtedness has been paid in full in cash and all
commitments in respect of such Senior Indebtedness have been terminated, the sum
of all  payments  in respect of the Note  (including  principal  and  interest),
together  with the sum of (i) all  payments  made  under all  other  Shareholder
Subordinated   Notes  and  (ii)  all  payments  made  by  the  Company  and  its
Subsidiaries  to  repurchase  stock or options to purchase  stock of the Company
held by officers  and  employees of the Company and its  Subsidiaries  shall not
exceed at any time that amount permitted by the terms of the respective issue of
Senior Indebtedness.

         (c) The Company may not,  directly or  indirectly,  make any payment of
any Subordinated  Indebtedness and may not acquire any Subordinated Indebtedness
for cash,  property,  securities or otherwise until all Senior  Indebtedness has
been paid in full in cash if any  default or event of  default  under the Credit
Agreement  (as  defined in Section  1.07 of this Annex A) or any other  issue of
Senior Indebtedness is then in existence or would result therefrom.  Each holder
of the Note hereby  agrees that, so long as any such default or event of default
in respect of any issue of Senior  Indebtedness  exists, it will not sue for, or
otherwise take any action to enforce the Company's  obligations to pay,  amounts
owing in respect of the Note.  Each  holder of the Note  understands  and agrees
that to the extent that clause (b) of this  Section  1.02 reduces the payment of
interest  and/or  principal  which would otherwise be payable under the Note but
for the  limitations  set forth in such clause (b), such unpaid amount shall not
constitute a payment  default  under the Note and the holder of the Note may not
sue for, or otherwise  take action to enforce the  Company's  obligation  to pay
such amount,  provided  that such unpaid  principal or interest  shall remain an
obligation of the Company to the holder of the Note pursuant to the terms of the
Note.

         (d) In the event that,  notwithstanding the provisions of the preceding
subsections (a), (b) and (c) of this Section 1.02, the Company (or any Person on
behalf of the  Company)  shall  make any  payment  of any kind or  character  on
account of the Subordinated Indebtedness at a time when payment is not permitted
by said  subsection (a), (b) or (c), such payment shall be held by the holder of
the Note,  in trust for the  benefit  of, and shall be paid  forthwith  over and
delivered to, the holders of Senior Indebtedness or their  representative or the
trustee under the indenture or other agreement pursuant to which any instruments
evidencing any Senior  Indebtedness  may have been issued,  as their  respective
interests  may  appear,  for  application  pro rata to the payment of all Senior
Indebtedness  remaining  unpaid  to  the  extent  necessary  to pay  all  Senior
Indebtedness in full in accordance  with the terms of such Senior  Indebtedness,
after giving  effect to any  concurrent  payment or  distribution  to or for the
holders of Senior  Indebtedness.  Without in any way modifying the provisions of
this

<PAGE>
                                                                         Annex A
                                                                          Page 2

Annex  A or  affecting  the  subordination  effected  hereby  if  the  hereafter
referenced  notice is not given,  the Company  shall give the holder of the Note
prompt  written  notice of any event which would prevent  payments under Section
1.02(a), (b) or (c) hereof.

         Section 1.03. Subordination to Prior Payment of All Senior Indebtedness
on Dissolution,  Liquidation or Reorganization of Company. Upon any distribution
of  assets  of  the  Company   upon   dissolution,   winding  up,   liquidation,
reorganization  or similar  proceeding  of the Company  (whether in  bankruptcy,
insolvency or receivership  proceedings or upon an assignment for the benefit of
creditors or otherwise):

         (a) the holders of all Senior  Indebtedness  shall first be entitled to
    receive  payment  in full in cash  of all  Senior  Indebtedness  (including,
    without  limitation,  post-petition  interest  at the rate  provided  in the
    documentation with respect to the Senior  Indebtedness,  whether or not such
    post-petition  interest  is an  allowed  claim  against  the  debtor  in any
    bankruptcy or similar  proceeding) before the holder of the Note is entitled
    to  receive  any  payment  of  any  kind  or  character  on  account  of the
    Subordinated Interest;

         (b) any payment or  distributions  of assets of the Company of any kind
    or character, whether in cash, property or securities to which the holder of
    the Note would be entitled  except for the provisions of this Annex A, shall
    be paid by the  liquidating  trustee or agent or other  person  making  such
    payment or  distribution,  whether a trustee in  bankruptcy,  a receiver  or
    liquidating  trustee or other  trustee or agent,  directly to the holders of
    Senior Indebtedness or their  representative or  representatives,  or to the
    trustee  or  trustees  under  any  indenture  under  which  any  instruments
    evidencing any such Senior  Indebtedness may have been issued, to the extent
    necessary  to make  payment  in full  in  cash  of all  Senior  Indebtedness
    remaining  unpaid,   after  giving  effect  to  any  concurrent  payment  or
    distribution to the holders of such Senior Indebtedness; and

         (c) in the event that, notwithstanding the foregoing provisions of this
    Section 1.03,  any payment or  distribution  of assets of the Company of any
    kind or  character,  whether  in  cash,  property  or  securities,  shall be
    received by the holder of the Note on account of  Subordinated  Indebtedness
    before  all Senior  Indebtedness  is paid in full in cash,  such  payment or
    distribution  shall be received and held in trust for and shall forthwith be
    paid over to the  holders of the  Senior  Indebtedness  remaining  unpaid or
    their representative or representatives, or to the trustee or trustees under
    any  indenture  under which any  instruments  evidencing  any of such Senior
    Indebtedness  may have been issued,  for  application to the payment of such
    Senior  Indebtedness until all such Senior Indebtedness shall have been paid
    in  full  in  cash,  after  giving  effect  to  any  concurrent  payment  or
    distribution to the holders of such Senior Indebtedness.

         Without  in any  way  modifying  the  provisions  of  this  Annex  A or
affecting the subordination  effected hereby if the hereafter  referenced notice
is not given,  the Company shall give prompt written notice to the holder of the
Note of any  dissolution,  winding  up,  liquidation  or  reorganization  of the
Company (whether in bankruptcy,  insolvency or receivership  proceedings or upon
assignment for the benefit of creditors or otherwise).

         Section 1.04. Subrogation. Subject to the prior payment in full in cash
of all Senior  Indebtedness,  the holder of the Note shall be  subrogated to the
rights  of  the  holders  of  Senior   Indebtedness   to  receive   payments  or
distributions  of assets of the Company  applicable  to the Senior  Indebtedness
until all amounts  owing on the Note shall be paid in full,  and for the purpose
of such  subrogation no payments or  distributions  to the holders of the Senior
Indebtedness  by or on behalf of the Company or by or on behalf of the holder of
the Note by virtue of this Annex A which  otherwise  would have been made to the
holder of the Note shall,  as between the Company,  its creditors other than the
holders  of Senior  Indebtedness,  and the  holder of the Note,  be deemed to be
payment by the  Company to or on  account of the Senior  Indebtedness,  it being
understood

<PAGE>
                                                                         Annex A
                                                                          Page 3

that the provisions of this Annex A are and are intended  solely for the purpose
of defining the relative  rights of the holder of the Note, on the one hand, and
the holders of the Senior Indebtedness, on the other hand.

         Section  1.05.  Obligation  of  the  Company   Unconditional.   Nothing
contained  in this Annex A or in the Note is  intended  to or shall  impair,  as
between the Company and the holder of the Note,  the  obligation of the Company,
which  is  absolute  and  unconditional,  to pay to the  holder  of the Note the
principal  of and interest on the Note as and when the same shall become due and
payable in  accordance  with their terms,  or is intended to or shall affect the
relative  rights of the holder of the Note and  creditors  of the Company  other
than the  holders  of the  Senior  Indebtedness,  nor shall  anything  herein or
therein  prevent the holder of the Note from  exercising all remedies  otherwise
permitted by applicable law upon an event of default under the Note,  subject to
the provisions of this Annex A and the rights, if any, under this Annex A of the
holders of Senior Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.  Upon any distribution of
assets of the Company  referred to in this Annex A, the holder of the Note shall
be  entitled  to rely upon any order or  decree  made by any court of  competent
jurisdiction   in  which  such   dissolution,   winding   up,   liquidation   or
reorganization  proceedings  are pending,  or a certificate  of the  liquidating
trustee or agent or other person  making any  distribution  to the holder of the
Note,  for the purpose of  ascertaining  the persons  entitled to participate in
such distribution, the holders of the Senior Indebtedness and other indebtedness
of the Company,  the amount  thereof or payable  thereon,  the amount of amounts
paid or  distributed  thereon and all other facts  pertinent  thereto or to this
Annex A.

         Section 1.06. Subordination Rights Not Impaired by Acts or Omissions of
Company  or Holders of Senior  Indebtedness.  No right of any  present or future
holders of any Senior  Indebtedness to enforce  subordination as herein provided
shall at any time in any way be  prejudiced or impaired by any act or failure to
act on the part of the  Company or by any act or failure to act in good faith by
any such  holder,  or by any  noncompliance  by the  Company  with the terms and
provisions  of the Note,  regardless  of any  knowledge  thereof  which any such
holder  may  have or be  otherwise  charged  with.  The  holders  of the  Senior
Indebtedness  may, without in any way affecting the obligations of the holder of
the Note  with  respect  hereto,  at any time or from  time to time and in their
absolute discretion,  change the manner, place or terms of payment of, change or
extend  the time of  payment  of,  or  increase,  renew  or  alter,  any  Senior
Indebtedness  or  amend,  modify  or  supplement  any  agreement  or  instrument
governing or evidencing such Senior  Indebtedness or any other document referred
to therein,  or exercise or refrain  from  exercising  any other of their rights
under the  Senior  Indebtedness  including,  without  limitation,  the waiver of
default  thereunder  and the  release of any  collateral  securing  such  Senior
Indebtedness, all without notice to or assent from the holder of the Note.

         Section 1.07. Senior Indebtedness. The term "Senior Indebtedness" shall
mean all  Obligations (as defined below) (i) of the Company under, or in respect
of,  the  Credit  Agreement  (as  amended,  modified,  supplemented,   extended,
restated,  refinanced,  replaced  or  refunded  from time to time,  the  "Credit
Agreement"),  dated as of August __,  2001,  by and among the Company and EMCORE
Corporation, as Lender, and the other Credit Documents (as defined in the Credit
Agreement), and any renewal,  extension,  restatement,  refinancing or refunding
thereof,  whether by the same or any other  agent,  lender or group of  lenders,
(ii) of the  Company in respect  of any other  indebtedness  unless the terms of
such indebtedness  expressly provide that it shall not be "Senior  Indebtedness"
for purposes of the Note. As used herein,  the term "Obligation"  shall mean any
principal,  interest, premium, penalties, fees, expenses,  indemnities and other
liabilities and obligations payable under the documentation governing any Senior
Indebtedness  (including  post-petition  interest  at the rate  provided  in the
documentation  with  respect to such  Senior  Indebtedness,  whether or not such
interest is an allowed  claim  against the debtor in any  bankruptcy  or similar
proceeding).

                                                                       Exhibit J

                               CONTROL AGREEMENT

                                                                 August___, 2001

First Union National Bank
[address line 1]
[address line 2]

Gentlemen:

               We refer to account number DDA 2090002593219 maintained with you,
as well as all other accounts that may from time to time be maintained  with you
(including any of your branches,  affiliates or subsidiaries) (all such accounts
are herein referred to as the "Account") by Uniroyal  Optoelectronics,  LLC (the
"Company") and into which moneys,  instruments  and other property are deposited
from time to time.  The Company has granted to EMCORE  Corporation,  as Assignee
(the  "Assignee")  for its own benefit  under,  and as defined in, that  certain
Security  Agreement,  dated as of August  ___,  2001,  among the Company and the
Assignee (as amended,  modified or supplemented from time to time, the "Security
Agreement"),  a security  interest  in  certain  assets  and  properties  of the
Company, including, among other things, the Account, all moneys, instruments and
other property deposited therein and all certificates or other  instruments,  if
any,  representing  or evidencing the Account (such  Account,  together with all
such moneys,  instruments,  other property,  certificates and other instruments,
are herein called the "Account Assets").

               By signing  this letter  agreement,  you agree that from the date
hereof and until this letter  agreement is  terminated  in  accordance  with the
terms hereof,  each Account shall be under the exclusive dominion and control of
the  Assignee  and all  moneys,  instruments  and other  property of the Company
deposited in each Account shall be held, subject to, and for the benefit of, the
security interest of the Assignee. In addition,  you hereby agree to comply with
instructions  originated by the Assignee  directing  dispositions of any and all
Account Assets without further consent by the Company,  provided that until such
time as you are  notified by the Assignee to the  contrary,  you may comply with
instructions  originated  by the Company  with  respect to  dispositions  of the
Account Assets.

                  You waive and agree not to assert, claim or endeavor to
exercise, and by executing this letter agreement bar and estop yourself from
asserting, claiming or exercising, and you acknowledge that you have not
heretofore received a notice from any other party asserting, claiming or
exercising, any right of setoff, banker's lien or other purported form of claim
with respect to the Account Assets and funds from time to time therein. To the
extent that you have any rights in the Account Assets, you hereby expressly
subordinate all such rights to all rights of the Assignee in the Account Assets.

               You may terminate this letter  agreement,  only upon thirty days'
prior  written  notice  to that  effect  to the  Company  and the  Assignee,  by
canceling the Accounts  maintained with you and transferring any and all Account
Assets to the Assignee  unless the Company and the Assignee  both have agreed in
writing to the contrary.

               This  letter   agreement   may  be  executed  in  any  number  of
counterparts and by the different parties hereto on separate counterparts,  each
of which  counterparts  shall be an  original,  but all of which shall  together
constitute one and the same instrument.  The terms and conditions of this letter
agreement may be modified only in writing signed by each of the parties hereto.

               This letter agreement  represents the authenticated record of the
agreement of the parties hereto.

                                     * * * *

<PAGE>

               THIS  LETTER  AGREEMENT,  AND THE RIGHTS AND  OBLIGATIONS  OF THE
PARTIES  HEREUNDER,  SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE  WITH, THE
LAW OF THE STATE OF NEW YORK.

                                         Very Truly Yours,

                                         UNIROYAL OPTOELECTRONICS, LLC

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

Acknowledged and agreed to
as of the date first above written:

FIRST UNION NATIONAL BANK

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

EMCORE CORPORATION, as Assignee

By:
   ----------------------------------
   Name:
   Title:REGISTRATION RIGHTS AGREEMENT

          THIS  REGISTRATION  RIGHTS  AGREEMENT  (the  "Agreement")  is made and
entered  into  as  of  August  2,  2001  by  and  between  UNIROYAL   TECHNOLOGY
CORPORATION,  a Delaware corporation (the "Company"),  and EMCORE CORPORATION, a
New Jersey  corporation,  (the "Purchaser")  pursuant to the Membership Interest
Purchase  Agreement,  dated as of  August 2, 2001  ("the  Purchase  Agreement"),
between the Company and the Purchaser. In order to induce the Purchaser to enter
into the Purchase Agreement,  the Company has agreed to provide the registration
rights  set  forth in this  Agreement.  The  execution  of this  Agreement  is a
condition to the closing under the Purchase Agreement.

          The Company agrees as follows:

          1. Definitions. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement.
As used in  this  Agreement,  the  following  terms  shall  have  the  following
meanings:

          Affiliate:  "Affiliate"  means,  with respect to any specified person,
(i) any other person  directly or indirectly  controlling  or controlled  by, or
under direct or indirect common control with, such specified  person or (ii) any
officer or director of such other person.  For purposes of this definition,  the
term "control"  (including the terms  "controlled  by" and "under common control
with")  of a person  means the  possession,  direct  or  indirect,  of the power
(whether or not  exercised) to direct or cause the  direction of the  management
and policies of a person, whether through the ownership of voting securities, by
contract, or otherwise.

          Business Day:  Each Monday,  Tuesday,  Wednesday,  Thursday and Friday
that is not a day on  which  banking  institutions  in the  City of New York are
authorized or obligated by law or executive order to close.

          Common Stock:  The shares of common stock,  $0.01 par value per share,
of the Company and any other  shares of common stock as may  constitute  "Common
Stock",  in each case that is issued under either the Purchase  Agreement or the
Credit  Agreement,  and any equity  security  issued or  issuable  with  respect
thereto upon any stock dividend, split, merger, consolidation or similar event.

          Credit Agreement:  The Credit  Agreement,  dated as of August 2, 2001,
between the Company and the Purchaser.

          Damages Accrual Period: See Section 2(a)(v) hereof.

          Damages Payment Date: The first day of each month.

          Deferral Period: See Section 2(a)(iv) hereof.

          Demand Registration: See Section 2(b)(i) hereof.

          Demand Request: See Section 2(b)(i) hereof.
<PAGE>

          Effectiveness  Period:  The period commencing with the date hereof and
ending on the  earlier  of (a)  August  2,  2006 plus such  number of days as is
contained in all Damages  Accrual  Periods  hereunder,  or (b) the date that all
Registrable Securities have ceased to be Registrable Securities.

          Event: See Section 2(a)(v) hereof.

          Event Date: See Section 2(a)(v) hereof.

          Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.

          Filing Date: See Section 2(a)(i) hereof.

          Holder:  A  beneficial  holder  from  time to time of the  Registrable
Securities.

          Indemnified Party: See Section 5(c) hereof.

          Indemnifying Party: See Section 5(c) hereof.

          Prospectus:  The  prospectus  included in the  Registration  Statement
(including,   without  limitation,   a  prospectus  that  discloses  information
previously omitted from a prospectus filed as part of an effective  registration
statement in reliance upon Rule 430A  promulgated  under the Securities Act), as
amended or  supplemented  by any amendment or prospectus  supplement,  including
post-effective  amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such Prospectus.

          Purchase Agreement: See the first paragraph of this Agreement.

          Record Holder:  the registered holder of shares of Common Stock on the
record date.

          Registrable  Securities:  The  Common  Stock  of  the  Company  issued
pursuant to the Purchase Agreement or the Credit Agreement  (including  pursuant
to  Sections  1.05(b)  and 10.01  thereof)  and any  equity  security  issued or
issuable  with  respect  thereto  upon  any  stock  dividend,   split,   merger,
consolidation  or similar event until, in the case of any such equity  security,
(i) it is  effectively  registered  under the  Securities Act and disposed of in
accordance with the Registration  Statement  covering it, (ii) it is saleable by
the holder  thereof  pursuant  to Rule  144(k) or (iii) it is sold to the public
pursuant to Rule 144, and, as a result of the event or circumstance described in
any of the  foregoing  clauses (i) through  (iii),  the legends  with respect to
transfer  restrictions  required  under the  Purchase  Agreement  are removed or
removable.

          Registration  Statement: A registration statement of the Company which
covers the Registrable  Securities pursuant to the provisions of this Agreement,
including  the  Prospectus,  amendments  and  supplements  to such  registration
statement,  including post-effective  amendments, all exhibits, and all material
incorporated  by  reference  or deemed to be  incorporated  by reference in such
registration statement.

                                      -2-
<PAGE>

          Rule  144:  Rule 144  under the  Securities  Act,  as such Rule may be
amended from time to time, or any similar rule or regulation  hereafter  adopted
by the SEC.

          Rule 144A:  Rule 144A under the  Securities  Act,  as such Rule may be
amended from time to time, or any similar rule or regulation  hereafter  adopted
by the SEC.

          Rule 144(k): Rule 144(k) under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation  hereafter  adopted
by the SEC.

          SEC: The Securities and Exchange Commission.

          Securities Act: The Securities Act of 1933, as amended,  and the rules
and regulations promulgated by the SEC thereunder.

          Shelf Registration: See Section 2(a)(i) hereof.

          Underwriter:   A  securities  dealer  who  purchases  any  Registrable
Securities  as  principal  and  not  as  part  of  such  dealer's  market-making
activities.

          2. Registration Rights.

          (a) Shelf Registration.

               (i) The Company  shall  prepare and file with the SEC, as soon as
practicable  but in any event on or prior to the date sixty (60) days  following
the  date  hereof  a  Registration  Statement  registering  the  resale  of  the
Registrable  Securities  from time to time by the Holders of all the Registrable
Securities  (other than Registrable  Securities  issuable pursuant to the Credit
Agreement),  and shall prepare and file with the SEC, as soon as practicable but
in any  event on or prior to the date  sixty  (60) days  following  the date the
Purchaser is issued any Registrable  Securities pursuant to the Credit Agreement
(including   Sections   1.05(b)  and  10.01   thereof),   an  amendment  to  the
aforementioned  Registration Statement or a subsequent  Registration  Statement,
for an offering to be made on a continuous  basis pursuant to Rule 415 under the
Securities Act registering the resale of such  Registrable  Securities from time
to time by the Holders thereof (all such registration statements and amendments,
collectively,  the "Shelf Registration  Statement" and such  registrations,  the
"Shelf  Registration").  The Shelf  Registration shall be on Form S-1 or S-3 (as
appropriate) or another  appropriate form permitting  registration of the resale
of the Common Stock.  The Company shall use its reasonable best efforts to cause
the Shelf Registration to be declared effective under the Securities Act as soon
as practicable and to keep the Shelf Registration  continuously  effective under
the Securities Act until the expiration of the Effectiveness Period. The date on
which the Shelf Registration Statement (or any post-effective  amendment thereto
required  by this  clause  (i)) is required to be filed is referred to herein as
the  "Filing  Date"  with  respect  to  such  Shelf  Registration  Statement  or
amendment.

               (ii) If the Shelf  Registration  ceases to be  effective  for any
reason as a result of the issuance of a stop order by the SEC at any time during
the  Effective  Period,  the Company  shall use its  reasonable  best efforts to
obtain the prompt withdrawal of any order suspending the effectiveness  thereof,
and in any event shall within thirty (30) days of such

                                      -3-
<PAGE>

cessation of effectiveness  amend the Shelf  Registration in a manner reasonably
expected to obtain the  withdrawal  of the order  suspending  the  effectiveness
thereof.

               (iii)  The  Company   shall   supplement   and  amend  the  Shelf
Registration if required by the rules, regulations or instructions applicable to
the  registration  form used by the  Company  for such  Shelf  Registration,  if
required by the Securities Act or if reasonably  requested by the Holders of the
Registrable Securities covered by such Registration Statement.

               (iv) In the event (A) of the  happening  of any event of the kind
described in Section 3(b)(ii),  3(b)(iii),  3(b)(iv), 3(b)(v) or 3(b)(vi) hereof
or (B) that,  in the judgment of the Company,  makes it advisable to suspend use
of the  Prospectus  for a  discrete  period  of  time  due to  pending  material
corporate  developments  or similar  materials  that have not yet been  publicly
disclosed and as to which the Company in good faith believes  public  disclosure
is reasonably likely to be detrimental to the Company, the Company shall deliver
a  certificate  in writing,  signed by an  authorized  executive  officer of the
Company,  to the Holders to the effect of the  foregoing  and, upon such notice,
the Company may suspend use of the  Registration  Statement until a supplemented
or amended Prospectus is filed with the SEC, or until the Holders are advised in
writing by the Company  that the  Prospectus  may be used,  and the Holders have
received copies of any additional or supplemental  filings that are incorporated
or deemed incorporated by reference in such Prospectus. The Company will use its
reasonable best efforts to ensure that the use of the Prospectus may be resumed,
and the use of the Registration  Statement will commence, as soon as practicable
and, in the case of a pending  development or event referred to in this Section,
as soon as the  earlier  of (x)  public  disclosure  of  such  pending  material
corporate  development or similar  material event or (y) the date upon which, in
the good faith  judgment of the  Company,  public  disclosure  of such  material
corporate  development or similar material event would not be reasonably  likely
to be detrimental  to the Company.  Notwithstanding  the foregoing,  the Company
shall not under any  circumstances  be entitled to exercise its right under this
Section  2(a)(iv) to suspend  the use of the  Registration  Statement  except as
follows:  The  Company  may suspend  the use of the  Registration  Statement  in
accordance with this Section  2(a)(iv) for a period (such period being "Deferral
Period") not to exceed (i) an aggregate of 45 days (in no more than two separate
periods) in any three-month  period and (ii) an aggregate of 90 days (in no more
than four separate periods) in any 12-month period,  and the period in which the
use of the  Registration  Statement is suspended  shall not exceed  fifteen (15)
days unless the  Company  shall  deliver to the  Holders a second  notice to the
effect set forth  above,  which  shall have the effect of  extending  the period
during  which the use of the  Registration  Statement  is  deferred  by up to an
additional  fifteen (15) days, or such shorter period of time as is specified in
such second notice.

               (v) The  parties  hereto  agree that the  Holders of  Registrable
Securities will suffer  damages,  and that it would not be feasible to ascertain
the extent of such damages with precision, if (A) the Shelf Registration has not
been filed on or prior to the Filing  Date,  (B) the Shelf  Registration  is not
declared effective within 90 days after the Filing Date, (C) prior to the end of
the Effectiveness  Period, the SEC shall have issued a stop order suspending the
effectiveness of the Shelf  Registration or proceedings have been initiated with
respect of the Shelf  Registration  under Section 8(d) or 8(e) of the Securities
Act or (D) the  aggregate  number of days in any  Deferral  Period  exceeds  the
number  permitted  pursuant to Section  2(a)(iv) hereof (each of the events of a
type described in any of the foregoing clauses (A) through (D) are individually

                                      -4-
<PAGE>

referred to herein as an "Event," and the Filing Date in the case of clause (A),
the 90th day after the Filing Date, in the case of clause (B), the date on which
the  effectiveness  of the Shelf  Registration has been suspended or proceedings
with  respect  to the  Shelf  Registration  under  Section  8(d)  or 8(e) of the
Securities  Act have been  commenced  in the case of clause (C), and the date on
which the number of days in any Deferral Period exceeds the number  permitted by
Section  2(a)(iv)  hereof in the case of clause (D), being referred to herein as
an "Event  Date").  Events  shall be deemed  to  continue  until the date of the
termination  of such Event,  which shall be the following  dates with respect to
the respective types of Events: the date the Registration  Statement is filed in
the case of an Event of the type  described  in clause  (A),  the date the Shelf
Registration becomes effective, in the case of an Event described in clause (B),
the date that all stop orders suspending effectiveness of the Shelf Registration
have been  removed  and the  proceedings  initiated  with  respect  to the Shelf
Registration  under Section 8(d) or 8(e) of the Securities Act have  terminated,
as the case may be, in the case of Events of the types  described in clause (C),
and termination of the Deferral Period which caused the aggregate number of days
in any Deferral Period to exceed the number  permitted by Section 2(a)(iv) to be
exceeded in the case of Events of the type described in clause (D).

          Accordingly,  upon the  occurrence of any Event and until such time as
there are no Events which have occurred and are  continuing (a "Damages  Accrual
Period"),  commencing  on the Event Date on which such  Damages  Accrual  Period
began, the Company agrees to pay, as liquidated  damages,  and not as a penalty,
an additional  amount (the  "Specified  Damages"):  (A) to each holder of Common
Stock,  accruing  at a rate equal to one-half of one percent per annum (50 basis
points)  calculated on an amount equal to the product of (x) $7.63 times (y) the
number of shares of Common  Stock held by such  holder;  and (B) if the  Damages
Accrual  Period  continues  for a period in excess of thirty  (30) days from the
Event  Date,  from and after the end of such (30) day period  until such time as
there are no Events which have  occurred and are  continuing,  to each holder of
Common  Stock,  accruing  at a rate equal to three  quarters  of one percent per
annum (75 basis  points)  calculated  on an amount  equal to the  product of (x)
$7.63  times (y) the  number of shares  of  Common  Stock  held by such  holder.
Notwithstanding  the foregoing,  no Specified  Damages shall accrue under clause
(A) of the  preceding  sentence  during any period for which  Specified  Damages
accrue  under  clause (B) of the  preceding  sentence  or as to any  Registrable
Securities  from and after the  earlier of (x) the date such  securities  are no
longer  Registrable  Securities and (y) expiration of the Effectiveness  Period.
The rate of accrual of the  Specified  Damages  with respect to any period shall
not  exceed  the  rate  provided  for  in  this  paragraph  notwithstanding  the
occurrence of multiple concurrent Events.

          The  Specified  Damages due shall be paid by the Company to the Record
Holders on each Damages  Payment Date by wire transfer of immediately  available
funds to the accounts specified by them or by mailing checks to their registered
addresses  as they appear in the  register  of the  Company for the  Registrable
Securities or Common Stock, if no such accounts have been specified on or before
the Damages Payment Date.

          (b)  Demand Registration.

               (i) A Holder (or  Purchaser,  if  Purchaser  is a Holders) of the
Registrable  Securities may make a written request and additional  requests once
every six months

                                      -5-
<PAGE>

as long as the Note between the  Purchaser  and the Company dated August 2, 2001
(the  "Note")  remains  outstanding  and not repaid in full,  and an  additional
request when the note is paid in full (each a "Demand Request") for registration
under the Securities Act of all or part of its Registrable Securities in a "firm
commitment"  underwritten offering (a "Demand Registration");  provided that the
Company  shall  not be  obligated  (A) to effect a Demand  Registration  for the
registration of Registrable  Shares, the market value of which is less than $7.5
million (as  determined by the average of the closing price for the  Registrable
Securities for the 20 trading dates  immediately prior to the delivery of notice
to the Company) or (B) to effect a registration  of any  Registrable  Securities
within 180 days after any  underwritten  offering  of equity  securities  by the
Company.  Such  request  will  specify  the  number  of  shares  of  Registrable
Securities proposed to be sold. Subject to Section 2(b)(iii),  the Company shall
file a registration statement with respect to the Demand Registration as soon as
practicable  thereafter and in any event within 90 days after receiving a Demand
Request (such 90th day being  referred to herein as the "Required  Filing Date")
and shall use its best efforts to cause the same to be declared effective by the
Commission as promptly as practicable after such filing.

               (ii) The Holders (or Purchaser,  if Purchaser is a Holder) of the
Registrable  Securities  to be  registered  pursuant to the Demand  Registration
shall select the managing Underwriters and any additional investment bankers and
managers to be used in connection with the offering; provided that such managing
Underwriters and additional  investment bankers must be reasonably  satisfactory
to the Company.

               (iii) The Company may, in its sole discretion, decline to grant a
Demand  Request on one  occasion.  In such event,  the Demand  Request  shall be
deemed  not to have  been  made  for the  purpose  of  Section  2(b)(i)  hereof,
provided, however, that the holders may not make another request within 120 days
following the denial by the Company to grant such Demand Request.

               (iv)  Notwithstanding  anything contained herein, if the managing
underwriter of an offering described in Section 2(b)(i) above delivers a written
opinion to the Company that marketing considerations require a limitation on the
number  of shares  offered  pursuant  to any  registration  statement,  then the
Company shall  include in such  registration  (A) first,  the  securities  being
offered for the account of the Holders of  Registrable  Securities,  (B) second,
the number of equity  securities  that the Company  wishes to  include,  and (C)
third, the number of equity securities requested by holders of equity securities
with registration  rights that in the opinion of such underwriter,  can be sold,
pro rata  among such  holders  on the basis of the  amount of equity  securities
requested to be included by each such holders.

               (v) A registration pursuant to this Section will not be deemed to
have been  "effected"  if it is  withdrawn  at the request of the holders of the
majority of the Registrable Securities to be included therein.

          (c)  Piggyback Registration.

               (i) If the  Company  proposes  to file a  registration  statement
under the  Securities  Act with  respect to an  underwritten  offering of equity
securities  (A) for the  Company's  own account or (B) for the account of any of
the holders of its equity securities, then the

                                      -6-
<PAGE>

Company shall give written notice of such proposed filing to each Holder as soon
as  practicable  (but  in no  event  less  than  20  business  days  before  the
anticipated   filing  date),  and  such  notice  shall  offer  such  Holder  the
opportunity to register such number of shares of Registrable  Securities as such
Holder may request on the same terms and  conditions  as the  Company's  or such
holder's equity securities (a "Piggyback Registration").  Each Holder desires to
have its Registrable Securities included in such registration  statement,  shall
so advise the Company in writing  (stating  the number of shares of Common Stock
desired to be registered)  within 15 business days after the date of such notice
from the Company.  Any Holder shall have the right to withdraw  such request for
inclusion of such Holder's Registrable  Securities in any registration statement
pursuant  to this  section  by  giving  written  notice to the  Company  of such
withdrawal prior to the effective date of the Registration Statement. Subject to
Section 2(c)(ii) below, the Company shall include in such registration statement
all such  Registrable  Securities  requested to be included  therein;  provided,
however,  that the Company may at any time withdraw or cease proceeding with any
such registration if it shall at the same time withdraw or cease proceeding with
the registration of all other securities originally proposed to be registered.

               (ii)  Notwithstanding  anything contained herein, if the managing
Underwriter of an offering described in Section 2(c)(i) above delivers a written
opinion to the Company that marketing considerations require a limitation on the
number  of shares  offered  pursuant  to any  registration  statement,  then the
Company shall  include in such  registration  (A) first,  the  securities  being
offered  for  the  account  of the  Company,  and  (B)  second,  the  number  of
Registrable  Securities  requested to be included  that,  in the opinion of such
Underwriter, can be sold, by the Holder.

          3.   Registration   Procedures.   In  connection  with  the  Company's
registration   obligations  under  Section  2  hereof,   the  Company  shall  as
expeditiously as possible:

          (a) Prepare and file with the Commission a  registration  statement on
any form for which the Company then  qualifies and which counsel for the Company
shall deem appropriate and available for the sale of the Registrable  Securities
to  be  registered   thereunder  in  accordance  with  the  intended  method  of
distribution thereof (including in a Rule 415 offering),  and use its reasonable
efforts  to cause such  filed  registration  statement  to become  effective  as
promptly as  practicable,  and  thereafter  prepare and file with the Commission
such  amendments  and  supplements  to  such  registration   statement  and  the
prospectus  used in  connection  therewith  as may be  necessary  to  keep  such
registration  statement  effective (i) for a period of not less than 120 days in
the case of any registration  other than the Shelf  Registration plus the period
of any delay or suspension of use of a prospectus  pursuant to Section  2(a)(iv)
hereof, and (ii) in the case of the Shelf Registration through the Effectiveness
Period  plus the  period  of any  delay  or  suspension  of use of a  prospectus
pursuant to Section 2(a)(iv) hereof.

          (b) Notify the Holders,  promptly, and confirm such notice in writing,
(i) when a Prospectus,  any Prospectus supplement, a Registration Statement or a
post-effective  amendment to a  Registration  Statement  has been filed with the
SEC,  and,  with respect to the  Registration  Statement  or any  post-effective
amendment, when the same has become effective, (ii) of any request by the SEC or
any other federal or state governmental  authority for amendments or supplements
to  the  Registration   Statement  or  related   Prospectus  or  for  additional
information, (iii)

                                      -7-
<PAGE>

of the issuance by the SEC or any other federal or state governmental  authority
of any stop order suspending the effectiveness of the Registration  Statement or
the initiation or threatening of any proceedings  for that purpose,  (iv) of the
receipt by the Company of any notification with respect to the suspension of the
qualification  or  exemption  from  qualification  of  any  of  the  Registrable
Securities for sale in any  jurisdiction or the initiation or threatening of any
proceeding  for such  purpose,  (v) of the existence of any fact or happening of
any event  which  makes any  statement  of a material  fact in the  Registration
Statement or related  Prospectus  or any document  incorporated  or deemed to be
incorporated  therein by reference  untrue or which would  require the making of
any changes in the  Registration  Statement or  Prospectus in order that, in the
case of the Registration  Statement, it will not contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and that in the case
of the Prospectus,  it will not contain any untrue  statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading,  and (vi) of the Company's good faith determination that a
post-effective amendment to the Registration Statement would be appropriate.

          (c) Use its  reasonable  best efforts to obtain the  withdrawal of any
order suspending the effectiveness of the Registration Statement, or the lifting
of any suspension of the qualification (or exemption from  qualification) of any
of the  Registrable  Securities  for sale in any  jurisdiction,  at the earliest
possible moment.

          (d) Prior to  filing a  Registration  Statement  or any  amendment  or
supplement  thereto,  furnish  to  each  selling  Holder,  copies  thereof,  and
thereafter   furnish  to  each  such  Holder  such  number  of  copies  of  such
registration statement, amendment and supplement thereto (in each case including
all exhibits  thereto and documents  incorporated by reference  therein) and the
prospectus included in such registration  statement  (including each preliminary
prospectus)  as each such  Holder may  reasonably  request  from time to time in
order to facilitate the sale of the Registrable Securities.

          (e)  Prior  to any  public  offering  of  Registrable  Securities,  to
register  or  qualify  (or  obtain  an  exemption  from  such   registration  or
qualification  of) such  Registrable  Securities  for offer  and sale  under the
securities  or Blue Sky laws of such  jurisdictions  within the United States as
any Holder  reasonably  requests  in  writing,  keep each such  registration  or
qualification  (or  exemption   therefrom)   effective  during  the  period  the
Registration Statement is required to be kept effective and do any and all other
acts or  things  necessary  or  advisable  to  enable  the  disposition  in such
jurisdictions  of  the  Registrable   Securities  covered  by  the  Registration
Statement;  provided,  that the  Company  shall not be  required  to (A) qualify
generally to do business in any  jurisdiction  where it is not then so qualified
or (B) take any action  that would  subject it to general  service of process in
suits or to taxation in any such jurisdiction where it is not then so subject.

          (f) Throughout the Effectiveness  Period (other than during a Deferral
Period),  immediately  upon the  existence of any fact or the  occurrence of any
event as a result of which the  Registration  Statement shall contain any untrue
statement of a material  fact or omit to state any material  fact required to be
stated therein or necessary to make the statements therein not misleading,  or a
Prospectus  shall  contain any untrue  statements  of a material fact or omit to
state

                                      -8-
<PAGE>

any  material  fact or omit to state any  material  fact  required  to be stated
therein or necessary to make each  statement  therein not  misleading,  promptly
prepare and file a post-effective  amendment to the Registration  Statement or a
supplement  to the related  Prospectus or any document  incorporated  therein by
reference or file any other required  document (such as a current Report on Form
8-K) that would be incorporated by reference into the Registration  Statement so
that the  Registration  Statement  shall not contain any untrue  statement  of a
material fact or omit to state any material  fact required to be stated  therein
or  necessary to make the  statements  therein not  misleading,  and so that the
Prospectus  will not contain any untrue  statement of a material fact or omit to
state any material fact  required to be stated  therein or necessary to make the
statements  therein,  in the light of the  circumstances  under  which they were
made, not misleading,  as thereafter delivered to the Holders,  and, in the case
of a post-effective  amendment to the Registration Statement, use its reasonable
best efforts to cause it to become effective as soon as practicable.

          (g) Comply with all  applicable  rules and  regulations of the SEC and
make generally  available to the holders of its securities  earnings  statements
(which need not be audited)  satisfying  the  provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder  (or any similar rule  promulgated  under
the Securities  Act) no later than 45 days after the end of any 12-month  period
(or 90 days  after the end of any  12-month  period  if such  period is a fiscal
year) (i)  commencing  at the end of any  fiscal  quarter  in which  Registrable
Securities  are  sold to  Underwriters  in a firm  commitment  or  best  efforts
underwritten offering, and (ii) if not sold to Underwriters in such an offering,
commencing  on  the  first  day of  the  first  fiscal  quarter  of the  Company
commencing  after  the  effective  date  of the  Registration  Statement,  which
statements shall cover said 12-month period.

          (h) Cooperate with the Holders of Registrable Securities to facilitate
the timely preparation and delivery of certificates representing Common Stock to
be issued and not bearing any restrictive  legends;  and enable such Registrable
Securities  to be in such  denominations  and  registered  in such  names as the
Holders may request.

          (i) Cause the Common Stock covered by the Registration Statement to be
listed and  registered  on each  national  securities  exchange or quoted on the
automated  quotation  system of a national  securities  association on which the
Company's "common stock" is then listed, no later than the effective date of the
Registration  Statement and, in connection therewith,  to the extent applicable,
to make such filings under the Exchange Act (e.g.,  the filing of a Registration
Statement on Form 8-A) and to have such filings declared effective thereunder.

          (j) Cooperate  and assist in any filings  required to be made with the
National Association of Securities Dealers, Inc.

          (k)  If   reasonably   requested  by  the  managing   underwriter   or
underwriters or a Holder of Registrable Securities being sold in connection with
an underwritten  offering,  promptly  incorporate in a prospectus  supplement or
post-effective  amendment such information as the managing  underwriters and the
Holders of the Registrable  Securities being sold in such underwritten  offering
agree  should  be  included  therein  relating  to the  sale of the  Registrable
Securities,  including,  without  limitation,  information  with  respect to the
aggregate  number  of  shares  of  Registrable  Securities  being  sold  to such
underwriters, the purchase price being paid

                                      -9-
<PAGE>

therefor  by such  underwriters  and  with  respect  to any  other  terms of the
underwritten offering of the Registrable Securities to be sold in such offering;
and  promptly  make  all  required  filings  of such  prospectus  supplement  or
post-effective amendment.

          (l) Cooperate with the selling  Holders of Registrable  Securities and
the managing  underwriters,  if any, to facilitate  the timely  preparation  and
delivery of certificates  representing Registrable Securities to be sold and not
bearing any restrictive legends; and enable such Registrable Securities to be in
such denominations and registered in such names as the managing underwriters may
request at least two Business Days prior to any sale of  Registrable  Securities
to the underwriters.

          (m) In the case of a Demand Registration under Section 2(b):

               (i) enter into such customary agreements (including  underwriting
agreements in customary  form) and take all such other actions as the holders of
a majority of the Registrable Securities being sold or the underwriters, if any,
reasonably  request in order to expedite or facilitate  the  disposition of such
Registrable Securities (including,  without limitation,  effecting a stock split
or a combination of shares);

               (ii) at the request of any seller of Registrable Securities,  use
its best efforts to furnish on the date that Restricted Securities are delivered
to the underwriters for sale pursuant to such registration an opinion dated such
date of counsel  representing the Company for the purposes of such registration,
addressed to the underwriters and to such seller, stating that such registration
statement has become effective under the Securities Act and that (A) to the best
knowledge of such counsel,  no stop order suspending the  effectiveness  thereof
has been issued and no proceedings  for that purpose have been instituted or are
pending  or  contemplated   under  the  Securities  Act,  (B)  the  registration
statement,  the related  prospectus  and each  amendment or  supplement  thereof
comply  as to  form  in all  material  respects  with  the  requirements  of the
Securities  Act  (except  that such  counsel  need not express any opinion as to
financial  statements  contained  therein)  and (iii) to such  other  effects as
reasonably may be requested by counsel for the underwriters or by such Holder or
its counsel;

               (iii) make  available for inspection by any seller of Registrable
Securities,  any underwriter  participating in any disposition  pursuant to such
registration statement, and any attorney,  accountant or other agent retained by
any such seller or  underwriter,  all  financial  and other  records,  pertinent
corporate  documents  and  properties  of the Company,  and cause the  Company's
officers,  directors,  employees  and  independent  accountants  to  supply  all
information  reasonably  requested  by any such seller,  underwriter,  attorney,
accountant or agent in connection with such registration statement; and

               (iv) obtain a cold comfort letter from the Company's  independent
public  accountants  in  customary  form and  covering  such matters of the type
customarily  covered by cold comfort letters as the holders of a majority of the
Registrable  Securities  being  sold  reasonably  request  (provided  that  such
Registrable Securities constitute at least 10% of the securities covered by such
registration statement).

                                      -10-
<PAGE>

          (n) In the case of any nonunderwritten  offering:  (1) obtain opinions
of counsel  to the  Company at the time of  effectiveness  of such  Registration
Statement  covering  such offering and updates  thereof of customary  frequency,
addressed to each Holder of any  Registrable  Securities  participating  in such
offering and covering  matters that are no more extensive in scope than would be
customarily covered in opinions obtained in secondary  underwritten offerings by
issuers  with  similar  market   capitalization   and  reporting  and  financial
histories;  (2) obtain "cold  comfort"  letters from the  independent  certified
public  accountants  of the  Company  at  the  time  of  effectiveness  of  such
Registration Statement and, upon the request of the Holders of a majority of the
Registrable Securities (or Purchaser,  if Purchaser is a Holder) covered by such
registration  statement,  updates thereof of customary  frequency,  in each case
addressed  to  each  Holder  of  Registrable  Securities  participating  in such
offering and covering  matters that are no more extensive in scope than would be
customarily  covered in "cold comfort" letters and updates obtained in secondary
underwritten  offerings  by  issuers  with  similar  market  capitalization  and
reporting and financial histories,  provided that any letter or update described
in this clause (2) shall only be  required to the extent such  letters are being
issued in respect of nonunderwritten  secondary  offerings under then prevailing
accounting  practices;  and (3)  deliver  a  certificate  of a senior  executive
officer  of the  Company  at the  time of  effectiveness  of  such  Registration
Statement and, upon the request of the Holders of a majority (or  Purchaser,  if
Purchaser  is  a  Holder)  of  the  Registrable   Securities   covered  by  such
Registration   Statement,   updates   thereof  of  customary   frequency,   such
certificates  to cover  matters no more  extensive  in scope than those  matters
customarily  covered in  officer's  certificates  delivered in  connection  with
underwritten  offerings  by  issuers  with  similar  market  capitalization  and
reporting and financial histories.  Notwithstanding  anything to the contrary in
this  Agreement,  the  Purchaser or  Purchasers  requesting  any of the items in
clause (1) or (2) hereof shall pay all costs, fees and expenses related thereto.

          4.  Registration  Expenses.  All fees  and  expenses  incident  to the
Company's performance of or compliance with this Agreement shall be borne by the
Company whether or not the Registration  Statement becomes effective,  provided,
however,  that with  respect to any  Registration  Statement  filed  pursuant to
Section 2(b) hereof all reasonable  fees and  out-of-pocket  expenses other than
fees and expenses  described in clause (vii) below shall be borne by the selling
Holders in  proportion to the number of shares of  Registrable  Securities to be
registered by each.  Such fees and expenses shall include,  without  limitation,
(i) all registration and filing fees (including,  without  limitation,  fees and
expenses  (x) with  respect to filings  required  to be made with the SEC or the
National Association of Securities Dealers,  Inc. and (y) relating to compliance
with federal securities or Blue Sky laws (including,  without  limitation,  fees
and  disbursements of counsel in connection with Blue Sky  qualifications of the
Registrable Securities under laws of such jurisdictions as may be required under
Section 3(e) hereof or as the Holder of the  Registrable  Securities  being sold
may designate),  (ii) all expenses  incurred in connection with the preparation,
word processing,  printing and distribution of the Registration  Statement,  any
Prospectus,  any amendments or supplements thereto, and other documents relating
to the performance of and compliance  with this Agreement,  (iii) the reasonable
fees and  disbursements of the registrar and transfer agent for the Common Stock
(iv) messenger,  telephone and delivery  expenses relating to the performance of
the Company's  obligations  hereunder,  (v) reasonable fees and disbursements of
counsel for the Company in connection with the Registration Statement, (vi) fees
and disbursements of all independent certified public accountants related to the
preparation of

                                      -11-
<PAGE>

the  Registration  Statement,  any  Prospectus,  or any  amounts or  supplements
thereto and (vii) Securities Act liability  insurance obtained by the Company in
its sole discretion. In addition, in all circumstances the Company shall pay its
internal expenses (including,  without limitation,  all salaries and expenses of
its officers and employees  performing legal or accounting duties),  the expense
of any annual  audit,  the fees and  expenses  incurred in  connection  with the
listing of the securities to be registered on any  securities  exchange on which
similar securities issued by the Company are then listed.

          5. Indemnification and Contribution.

          (a)  Indemnification  by the  Company -  Registrable  Securities.  The
Company  agrees to indemnify  and hold  harmless  each  selling  Holder and each
Person,  if any, who controls  each selling  Holder within the meaning of either
Section 15 of the  Securities  Act or Section 20 of the  Exchange  Act,  and the
officers, directors,  Affiliates, employees and agents of each of the foregoing,
from and against any and all losses, claims, judgments,  damages and liabilities
(including reasonable fees,  disbursements and other charges of counsel) arising
out of or based  upon any untrue  statement  or alleged  untrue  statement  of a
material  fact   contained  in  any   Registration   Statement  (as  amended  or
supplemented  if the Company shall have  furnished any amendments or supplements
thereto) or any preliminary or final Prospectus contained therein or arising out
of or  based  upon  any  omission  or  alleged  omission  to  state  in any such
Registration  Statement  or  Prospectus  a material  fact  required to be stated
therein or  necessary to make the  statements  therein (as to a  preliminary  or
final prospectus), in light of the circumstances under which they were made, not
misleading,  and any failure by the Company to fulfill  any  undertaking  in any
Registration  Statement,  except  insofar  as such  losses,  claims,  judgments,
damages or liabilities  arise out of or are based upon any such untrue statement
or omission or alleged  untrue  statement or omission  made in  conformity  with
information  relating to such Holder or the plan of  distribution of Registrable
Securities to be sold by such Holder,  in each case  furnished in writing to the
Company by such Holder  expressly  for use therein;  provided that the foregoing
indemnity  agreement with respect to any preliminary  prospectus shall not inure
to the benefit of a selling  Holder with respect to any loss,  claim,  damage or
liability  relating  to a  purchaser  if a copy  of  the  final  prospectus  was
furnished to such selling Holder and was not provided to such purchaser and such
final  prospectus  would have cured the defect giving rise to such loss,  claim,
damage  or  liability.  The  Company  agrees to  reimburse  the  Purchasers  for
reasonable  fees  and  expenses   incurred   investigating   claims  subject  to
indemnification  under this Section  5(a).  The Company also agrees to indemnify
any Underwriters of the Registrable Securities, their officers and directors and
each person who controls such  Underwriters on  substantially  the same basis as
that of the  indemnification  of the selling  Holders  provided in this  Section
5(a).

          (b) Indemnification by Selling Holders - Registrable Securities.  Each
selling  Holder agrees  severally and not jointly to indemnify and hold harmless
the  Company,  and each person,  if any,  who  controls  the Company  within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act, and the officers,  directors,  Affiliates,  employees and agents of each of
the foregoing, from and against any and all losses, claims,  judgments,  damages
and liabilities  (including reasonable fees,  disbursements and other charges of
counsel)  arising out of or based upon any untrue  statement  or alleged  untrue
statement of a material fact contained in any Registration Statement (as amended
or supplemented if the

                                      -12-
<PAGE>

Company shall have  furnished  any  amendments  or  supplements  thereto) or any
preliminary or final Prospectus  contained  therein,  or arising out of or based
upon any omission or alleged  omission to state therein a material fact required
to be stated  therein or necessary to make the statements  therein,  in light of
the circumstances  under which they were made, not misleading,  but only insofar
as such losses,  claims,  judgments,  damages or liabilities arise out of or are
based upon any such untrue  statement or omission or alleged untrue statement or
omission made in conformity with information relating to such Holder or the plan
of  distribution  of Registrable  Securities to be sold by such Holder,  in each
case  furnished  in writing  to the  Company by such  Holder  expressly  for use
therein.  Each Holder,  by exercising its registration  rights  hereunder,  also
agrees to  indemnify  and hold  harmless  any  Underwriters  of the  Registrable
Securities,  their  officers and  directors  and each person who  controls  such
Underwriters on substantially the same basis as that to the  indemnification  of
the Company  provided in this Section 5(b) subject to the  limitations set forth
in 5(e).

          (c) Conduct of  Indemnification  Proceedings.  In case any  proceeding
(including any  governmental  investigation)  shall be instituted  involving any
person in respect of which  indemnity may be sought pursuant to Sections 5(a) or
(b),  such person (the  "Indemnified  Party") shall  promptly  notify the person
against whom such indemnity may be sought (the "Indemnifying  Party") in writing
of such proceeding;  provided, that the failure to notify the Indemnifying Party
shall not relieve it from any liability that it may have to an Indemnified Party
on account of the  indemnity  agreement  contained in Sections 5(a) or (b) above
except to the extent that the Indemnifying Party was actually prejudiced by such
failure,  and in no event shall such failure relieve the Indemnifying Party from
any  other  liability  that  it may  have  to  such  Indemnified  Party.  If the
Indemnified  Party,  at its option,  elects to defend any such  proceeding  with
counsel  retained  by  it,  the  Indemnifying  Party  shall  pay  the  fees  and
disbursements  of such counsel related to such  proceeding.  Upon the request of
the Indemnified  Party, the Indemnifying  Party shall retain counsel  reasonably
satisfactory to such Indemnified  Party to represent such Indemnified  Party and
any others the Indemnifying Party may designate in such proceeding and shall pay
the fees and  disbursements  of such  counsel  related to such  proceeding.  If,
pursuant to the immediately preceding sentence, the Indemnified Party shall have
requested the Indemnifying party to retain counsel to represent such Indemnified
Party with respect to any such proceeding,  any Indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such Indemnified  Party unless (i) the  Indemnifying  Party
and the  Indemnified  Party shall have mutually  agreed to the retention of such
counsel  or (ii)  the  named  parties  to any  such  proceeding  (including  any
impleaded parties) include both the Indemnified Party and the Indemnifying Party
and  representation  of both parties by the same counsel would be  inappropriate
due to actual or potential  differing  interests  between them. It is understood
that the  Indemnifying  Party shall not, in  connection  with any  proceeding or
related  proceedings  in the  same  jurisdiction,  be  liable  for the  fees and
expenses of more than one separate  firm of attorneys  (in addition to any local
counsel) at any time for all such  Indemnified  Parties,  and that all such fees
and expenses shall be reimbursed as they are incurred.  Any  Indemnifying  Party
against whom indemnity may be sought under this Section 5(c) shall not be liable
to indemnify any Indemnified  Party if such Indemnified Party settles such claim
or action  without  the  consent of the  Indemnifying  Party  which shall not be
unreasonably withheld. The Indemnifying Party may not agree to any settlement of
any such claim or action,  other than solely for monetary  damages for which the
Indemnifying Party shall be responsible hereunder and with a full release of

                                      -13-
<PAGE>

the Indemnified  Party,  resulting in any remedy or relief applied to or against
the  Indemnified  Party,  without the prior written  consent of the  Indemnified
Party.

          (d) Contribution - - Offerings. If the indemnification provided for in
Sections 5(a) or (b) is unavailable  to an  Indemnified  Party in respect of any
losses, claims, judgments,  damages or liabilities referred to herein, then each
such Indemnifying  Party, in lieu of indemnifying such Indemnified  Party, shall
contribute to the amount paid or payable by such  Indemnified  Party as a result
of such losses, claims, judgments,  damages or liabilities in such proportion as
is appropriate to reflect the relative fault of the Company, the selling Holders
and the  Underwriters  in  connection  with the  statements  or  omissions  that
resulted in such losses, claims, judgments,  damages or liabilities,  as well as
any other relevant equitable considerations.  The relative fault of the Company,
the selling  Holders and the  underwriters  shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the  omission or alleged  omission to state a material  fact  relates to
information supplied by such party and the parties' relative intent,  knowledge,
access to  information  and  opportunity to correct or prevent such statement or
omission.  If the  allocation  provided for above is not permitted by applicable
law, such  contribution  shall be based on such  equitable  considerations  as a
court may determine to be relevant.

          The Company and the  selling  Holders  agree that it would not be just
and equitable if  contribution  pursuant to this Section 5(d) were determined by
pro rata  allocation  (even if the  Underwriters  were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount  paid or payable by an  Indemnified  Party as a result of the losses,
claims,  damages  or  liabilities  referred  to  in  the  immediately  preceding
paragraph  shall be deemed to  include,  subject  to the  limitations  set forth
above, any legal or other expenses reasonably incurred by such Indemnified Party
in connection with investigating or defending any such action or claim.

          (e)  Notwithstanding  the provisions of this Section 5, no Underwriter
shall be required to  contribute or indemnify any amount in excess of the amount
by which  the  total  price  at  which  the  Securities  underwritten  by it and
distributed  to the public were offered to the public  exceeds the amount of any
damages which such  Underwriter  has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission,  and no
selling  Holder  shall be required to  contribute  or  indemnify  any  aggregate
amounts  in excess  of the  amount by which  the net  proceeds  of the  offering
(before deducting  expenses)  received by such selling Holder exceeds the amount
of any damages which such selling  Holder has otherwise  been required to pay by
reason of such  untrue or  alleged  untrue  statement  or  omission  or  alleged
omission. No person guilty of fraudulent  misrepresentation  (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to  indemnification or
contribution  under  this  Section 5 from any  Person who was not guilty of such
fraudulent misrepresentation.

          6. Additional Registration Rights Provisions.

          (a) Participation in  Registrations.  No Person may participate in any
underwritten  registered offering contemplated  hereunder unless such Person (a)
agrees  to  sell  its   securities  on  the  basis  provided  in  any  customary
underwriting  arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all

                                      -14-
<PAGE>

questionnaires,   powers  of  attorney,   indemnities,   customary  underwriting
agreements  and  other  documents  reasonably  required  under the terms of such
underwriting   arrangements  and  these  Registration   Rights.  No  Person  may
participate in a registered  offering pursuant to the Shelf Registration  unless
such Person provides information reasonably requested by the Company customarily
required   to  effect   registration   of  the  resale  of  the  Common   Stock.
Notwithstanding the above, with respect to a Piggyback Registration, the Holders
shall not be required to provide  indemnification  except to the extent provided
pursuant  to  this  Agreement.  The  Holders  shall  only  be  required  to give
representations and warranties that are customary for selling shareholders.

          (b) Lockup  Agreements.  Each Holder,  by exercising its  registration
rights  hereunder,  agrees not to offer,  sell,  contract  to sell or  otherwise
dispose of any Registrable  Securities,  or any securities  convertible  into or
exchangeable  or exercisable for such  securities,  during the 14 days prior to,
and during the 90-day  period  (or such  lesser  period as the lead or  managing
underwriters may permit)  beginning on, the effective date of such  Registration
Statement (or the commencement of the offering to the public of such Registrable
Securities  in the case of Rule 415  offerings)  other than (i) the  Registrable
Securities  to be sold  pursuant  to such  Registration  Statement  or (ii) in a
transaction  not  involving a public  offering,  provided that the purchaser (or
purchasers) of such shares agrees to be bound by such lock-up  restrictions  for
the remainder of the lock-up period.

          (c) With a view to making  available  to the  holders  of  Registrable
Securities  the benefits of certain rules and  regulations  of the SEC which may
permit  the  sale  of  the   Registrable   Securities  to  the  public   without
registration, the Company agrees to use its reasonable best efforts to:

               (i) make and keep current public  information  available,  within
the meaning of Rule 144 or any similar or analogous rule  promulgated  under the
Securities Act, at all times;

               (ii) file with the SEC, in a timely manner, all reports and other
documents required under the Securities Act and Exchange Act; and

               (iii)  so  long  as  any  party   hereto  owns  any   Registrable
Securities, furnish to such Person forthwith upon request a written statement as
to its  compliance  with  the  reporting  requirements  of said  Rule  144,  the
Securities  Act and the  Exchange  Act;  a copy of its  most  recent  annual  or
quarterly  report;  and such other  reports  and  documents  as such  Person may
reasonably  request  in  availing  itself of any rule or  regulation  of the SEC
allowing it to sell such securities without registration.

          (d) The Company will provide to any holder of a Registrable  Security,
upon such persons' request, the information required by paragraph (d)(4) of Rule
144A.

          7. Miscellaneous.

          (a)  Remedies.  In  the  event  of a  breach  by  the  Company  of its
obligations  under this  Agreement,  each Holder of Registrable  Securities,  in
addition  to being  entitled to exercise  all rights  granted by law,  including
recovery of damages, will be entitled to specific

                                      -15-
<PAGE>

performance of its rights under this Agreement. The Company agrees that monetary
damages would not be adequate  compensation for any loss incurred by reason of a
breach by it of any of the  provisions  of this  Agreement  and  hereby  further
agrees that, in the event of any action for specific  performance  in respect of
such breach, it shall waive the defense that remedy of law would be adequate.

          (b) No  Conflicting  Agreements.  The  Company has not, as of the date
hereof,  and shall not, on or after the date of this  Agreement,  enter into any
agreement with respect to its securities which conflicts with the rights granted
to the  Holders  of  Registrable  Securities  in  this  Agreement.  The  Company
represents  and warrants that the rights  granted to the Holders of  Registrable
Securities  hereunder do not in any way conflict with the rights  granted to the
holders of the Company's securities under any other agreements.

          (c)  Amendments  and  Waivers.   The  provisions  of  this  Agreement,
including  the  provisions  of this  sentence,  may not be amended,  modified or
supplemented, and waivers to or departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of the Holders (or if
the Purchaser is a Holder, the Purchaser).

          (d)  Notices.  All notices and other  communications  provided  for or
permitted  hereunder shall be made in writing and shall be deemed given (i) when
made, if made by hand delivery, (ii) upon confirmation, if made by telecopier or
(iii) one business day after being deposited with a reputable  next-day courier,
postage prepaid, to the parties as follows:

               (x) if to the  Holder  of  Registrable  Securities,  at the  most
current  address  given by the  Holder to the  Company  in  accordance  with the
provisions of Section 7(e); and

                           (y)      if to the Company, to:

                           Uniroyal Technology Corporation
                                    2 North Tamiami Trail, Suite 900
                                    Sarasota, Florida  34236
                                    Attention:  George J. Zulanas, Jr.
                                    Telephone:  (941) 361-2220
                                    Telecopy:  (941) 361-2214

                  with a copy to:

                                    Uniroyal Technology Corporation
                                    2 North Tamiami Trail, Suite 900
                                    Sarasota, Florida  34236
                                    Attention:   Oliver J. Janney, Esq.
                                    Telephone:  (941) 361-2212
                                    Telecopy:  (941-361-2214

or such other  address as such person may have  furnished  to the other  persons
identified in this Section 7(d) in writing in accordance herewith.

                                      -16-
<PAGE>

          (e) Owner of Registrable  Securities.  The Company will  maintain,  or
will cause its registrar and transfer agent to maintain, a register with respect
to the Registrable  Securities in which all transfers of Registrable  Securities
of which the Company has received notice will be recorded.  The Company may deem
and treat the person in whose name Registrable Securities are registered in such
register  of the  Company  as the owner  thereof  for all  purposes,  including,
without limitation, the giving of notices under this Agreement.

          (f) Successors and Assigns.  Any person who purchases any  Registrable
Securities from the Purchaser  shall be deemed,  for purposes of this Agreement,
to be an assignee of the Purchaser. This Agreement shall inure to the benefit of
and be binding upon the  successors and assigns of each of the parties and shall
inure to the  benefit  of and be  binding  upon each  Holder of any  Registrable
Securities.  This Agreement may not be assigned by the Company without the prior
written consent of the Purchasers.

          (g)  Counterparts.  This  Agreement  may be  executed in any number of
counterparts and by the parties hereto in separate  counterparts,  each of which
when so  executed  shall be deemed  to be the  original  and all of which  taken
together shall constitute one and the same agreement.

          (h) Headings.  The headings in this  Agreement are for  convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

          (i) Governing Law. This  agreement  shall be governed by and construed
in  accordance  with the laws of the state of New York,  as applied to contracts
made and performed  within the state of New York without regard to principles of
conflicts of laws.

          (j) Severability.  If any term, provision,  covenant or restriction of
this  Agreement  is held to be  invalid,  illegal,  void or  unenforceable,  the
remainder of the terms, provisions,  covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected,  impaired
or invalidated  thereby,  and the parties hereto shall use their best efforts to
find and employ an alternative  means to achieve the same or  substantially  the
same  result  as  that  contemplated  by  such  term,  provision,   covenant  or
restriction.  It is hereby  stipulated  and declared to be the  intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions  without including any of such which may be hereafter  declared
invalid, illegal, void or unenforceable.

          (k) Entire  Agreement.  This Agreement is intended by the parties as a
final  expression  of their  agreement  and is  intended  to be a  complete  and
exclusive  statement of the agreement and understanding of the parties hereto in
respect of the  subject  matter  contained  herein and the  registration  rights
granted by the Company with  respect to the  Registrable  Securities.  Except as
provided  in  the  Purchase  Agreement  there  are  no  restrictions,  promises,
warranties  or  undertakings,  other than those set forth or referred to herein,
with respect to the  registration  rights granted by the Company with respect to
the Registrable  Securities.  This Agreement supersedes all prior agreements and
understandings among the parties with respect to such registration rights.

                                      -17-
<PAGE>

          (l) Attorneys' Fees. In any action or proceeding  brought to enforce a
provision of this Agreement,  or where any provision  hereof is validly asserted
as a defense,  the  prevailing  party,  as  determined  by the  court,  shall be
entitled  to  recover  reasonable  attorneys'  fees  in  addition  to any  other
available remedy.

          (m) Further  Assurances.  The Company shall use all reasonable efforts
to take, or cause to be taken,  all appropriate  action,  do or cause to be done
all things reasonably  necessary,  proper or advisable under applicable law, and
execute and deliver such  documents and other papers as may be required to carry
out of the  provisions of this  Agreement and the other  documents  contemplated
hereby and consummate and make effective the transactions contemplated hereby.

          (n)  Termination.  This  Agreement and the  obligations of the parties
hereunder shall terminate upon the end of the Effectiveness  Period,  except for
any  liabilities  or  obligations  under  Sections  4,  5 or 6  hereof  and  the
obligations to make payments of and provide for Specified  Damages under Section
2(a)(v)  hereof  to the  extent  such  damages  accrue  prior  to the end of the
Effectiveness Period, each of which shall survive termination of this Agreement.

          (o) Information Available. So long as the Shelf Registration Statement
is  effective,   the  Company  shall  furnish  to  each  holder  of  Registrable
Securities:

          (i) as soon as  practicable  after  available  (but in the case of the
Company's Annual Report to  Stockholders,  within 120 days after the end of each
fiscal  year of the  Company),  one copy of its  Annual  Report to  Stockholders
(which Annual Report shall contain  financial  statements  audited in accordance
with  generally  accepted  auditing  standards  certified by a national  firm of
certified public accountants).

                                      -18-
<PAGE>

          IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.

                                  UNIROYAL TECHNOLOGY CORPORATION

                                  By:/s/George J. Zulanas, Jr.
                                     ------------------------------------------
                                     Name: George J. Zulanas, Jr.
                                     Title: Executive Vice President, Treasurer
                                               and Chief Financial Officer

Accepted as of the date first above written:
EMCORE CORPORATION.

By:/s/Thomas Werthan
   -----------------------------------
   Name:  Thomas Werthan
   Title: Chief Financial Officer

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