Document:

<PAGE>   1
                                                                    EXHIBIT 10.1

                                                                [EXECUTION COPY]

                            NOTE PURCHASE AGREEMENT,

                          dated as of January 12, 2000,

                                     between

                             MCM CAPITAL GROUP, INC.

                                 as the Issuer,

                                       and

                             ING (U.S.) CAPITAL LLC,

                                as the Purchaser,

                                       for

                         $10,000,000 Principal Amount of

              12.0% Series No. 1 Senior Notes due January 15, 2007

                                       and

                   Warrants to Purchase 428,571 Common Shares.
<PAGE>   2
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                       PAGE
                                                                       ----
<S>                                                                    <C>
                              ARTICLE I DEFINITIONS
SECTION 1.1 Defined Terms                                               1
SECTION 1.2 Use of Defined Terms                                        13
SECTION 1.3 Cross References                                            13
SECTION 1.4 Accounting and Financial Determinations                     13

                   ARTICLE II PURCHASE AND SALE OF SECURITIES
SECTION 2.1 Purchase Commitment                                         14
SECTION 2.2 Issue Price                                                 14
SECTION 2.3 Closing                                                     14

                        ARTICLE III CONDITIONS TO CLOSING
SECTION 3.1 Certificate of Incorporation                                15
SECTION 3.2 Resolutions, etc.                                           15
SECTION 3.3 Series No. 1 Note                                           15
SECTION 3.4 Warrants                                                    15
SECTION 3.5 Guaranties.                                                 15
SECTION 3.6 Material Contracts                                          16
SECTION 3.7 Performance; No Default                                     16
SECTION 3.8 Absence of Litigation, etc.                                 16
SECTION 3.9 Certificate as to Compliance, etc.                          16
SECTION 3.10 Certificate as to Solvency, etc.                           16
SECTION 3.11 Opinion of Counsel                                         16
SECTION 3.12 Fees                                                       17
SECTION 3.13 Wire Instructions                                          17
SECTION 3.15 Legal Investment                                           17
SECTION 3.16 Satisfactory Legal Form                                    17
SECTION 3.17 Approvals, etc.                                            17

                     ARTICLE IV PAYMENTS, REGISTRATION, ETC.
SECTION 4.1 Place of Payment                                            17
SECTION 4.2 Home Office Payment                                         17
SECTION 4.3 Optional Payments                                           18
SECTION 4.4 Payment of Principal and Interest                           18
SECTION 4.5 Allocation                                                  19
SECTION 4.6 Mandatory Offer of Redemption of Series No. 1 Notes         19
SECTION 4.7 Assignments by Noteholders                                  20
SECTION 4.7.1 Consent to Certain Assignments                            20
SECTION 4.7.2 Procedures                                                20
SECTION 4.7.3 Terms and Conditions                                      20
SECTION 4.7.4 Registration, Transfer, etc.                              21
SECTION 4.8 Transfer and Exchange                                       21
SECTION 4.9 Replacement                                                 21
</TABLE>

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<TABLE>
<S>                                                                    <C>
SECTION 4.10 Taxes                                                      22

                            ARTICLE V WARRANTIES, ETC.
SECTION 5.1 Organization, Power, Authority, etc.                        23
SECTION 5.2 Due Authorization                                           24
SECTION 5.3 Validity, etc.                                              24
SECTION 5.4 Financial Information                                       24
SECTION 5.5 Absence of Material Adverse Change                          25
SECTION 5.6 Continuing Indebtedness                                     25
SECTION 5.7 Contingencies                                               25
SECTION 5.8 Litigation, etc.                                            25
SECTION 5.9 Capitalization                                              25
SECTION 5.10 Margin Regulations                                         26
SECTION 5.11 Government Regulation                                      26
SECTION 5.12 Title to and Condition of Properties; Material Contracts   26
SECTION 5.13 Patents, Trademarks, etc.                                  27
SECTION 5.14 Taxes                                                      27
SECTION 5.15 Pension and Welfare Plans                                  27
SECTION 5.16 Environmental Matters                                      27
SECTION 5.17 Year 2000 Problem                                          28
SECTION 5.18 Solvency                                                   28
SECTION 5.19 Subsidiaries, etc.                                         28
SECTION 5.20 Accuracy of Information                                    29
SECTION 5.21 Offering of Subject Securities                             29

                              ARTICLE VI COVENANTS
SECTION 6.1 Certain Affirmative Covenants                               29
SECTION 6.1.1 Financial Information, etc.                               30
SECTION 6.1.2 Notice of Default, etc.                                   31
SECTION 6.1.3 Maintenance of Corporate Existence, etc.                  32
SECTION 6.1.4 Performance of Purchase Documents                         32
SECTION 6.1.5 Books and Records                                         32
SECTION 6.1.6 Subsidiary Guarantors                                     32
SECTION 6.1.7 Payment of Taxes, etc.                                    32
SECTION 6.1.8 Environmental Conduct                                     32
SECTION 6.1.9 Use of Proceeds                                           33
SECTION 6.1.10 Insurance                                                33
SECTION 6.1.11 Subsequent Note Issuance                                 33
SECTION 6.2 Certain Negative Covenants                                  33
SECTION 6.2.1 Business Activities                                       33
SECTION 6.2.2 Indebtedness                                              33
SECTION 6.2.3 Liens                                                     35
SECTION 6.2.4 Bank of America Credit Agreement.                         35
SECTION 6.2.5 Restricted Payments, etc.                                 35
SECTION 6.2.6 Investments                                               36
SECTION 6.2.7 Consolidation, Merger, etc.                               36
SECTION 6.2.8 Rental Obligations                                        37
</TABLE>

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<TABLE>
<S>                                                                    <C>
SECTION 6.2.9 Take or Pay Contracts                                     37
SECTION 6.2.10 Negative Pledges, Upstream Restrictions, etc.            37
SECTION 6.2.11 Transactions with Affiliates                             37
SECTION 6.2.12 Asset Dispositions, etc.                                 38

                          ARTICLE VII EVENTS OF DEFAULT
SECTION 7.1 Events of Default                                           38
SECTION 7.1.1 Non-Payment of Obligations                                38
SECTION 7.1.2 Default on Other Indebtedness                             38
SECTION 7.1.3 Bankruptcy, Insolvency, etc.                              39
SECTION 7.1.4 Breach of Warranty                                        39
SECTION 7.1.5 Non-Performance of Certain Undertakings                   39
SECTION 7.1.6 Non-Performance of Other Undertakings                     39
SECTION 7.1.7 Judgments                                                 39
SECTION 7.1.8 Pension Plans                                             40
SECTION 7.1.9 Clean Audit                                               40
SECTION 7.2 Action if Bankruptcy                                        40
SECTION 7.3 Action if Other Event of Default                            40
SECTION 7.4 Suits for Enforcement                                       40
SECTION 7.5 Remedies Cumulative                                         40

                           ARTICLE VIII MISCELLANEOUS
SECTION 8.1 Waivers, Amendments, etc.                                   41
SECTION 8.2 Notices                                                     41
SECTION 8.3 Costs and Expenses                                          41
SECTION 8.4 Indemnification                                             42
SECTION 8.5 Survival                                                    42
SECTION 8.6 Severability                                                42
SECTION 8.7 Headings                                                    43
SECTION 8.8 Counterparts                                                43
SECTION 8.9 Governing Law                                               43
SECTION 8.10 Jurisdiction                                               43
SECTION 8.11 Successors and Assigns                                     43
SECTION 8.12 Waiver of Jury Trial.                                      43
</TABLE>
<TABLE>
<S>            <C>
SCHEDULE I -   Disclosure Schedule
 Item 3.4  -   Capital Stock
 Item 5.6  -   Ongoing Indebtedness
 Item 5.8  -   Litigation
 Item 5.9  -   Repurchase, etc. Agreements
 Item 5.12 -   Defaults
 Item 5.13 -   Patents, Trademarks
 Item 5.15 -   Employee Benefit Plans
 Item 5.16 -   Environmental Matters
 Item 5.19 -   Subsidiaries
</TABLE>

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<TABLE>
<S>            <C>
EXHIBIT A  -   Form of Series No. 1 Note
EXHIBIT B  -   Certificate as to Certificate of Incorporation
EXHIBIT C  -   Certificate as to Authorizing Resolutions, etc.
EXHIBIT D  -   Form of Subsidiary Guaranty
EXHIBIT E  -   Form of Warrant Agreement
EXHIBIT F  -   Form of Assignment and Acceptance
EXHIBIT G  -   Certificate as to Compliance
EXHIBIT H  -   Certificate as to Solvency
EXHIBIT I  -   Form of Opinion of Counsel
</TABLE>

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<PAGE>   6
                             NOTE PURCHASE AGREEMENT

         THIS NOTE PURCHASE AGREEMENT, dated as of January 12, 2000, between MCM
CAPITAL GROUP, INC., a Delaware corporation (the "Company") and ING (U.S.)
CAPITAL LLC, a Delaware limited liability company (alternatively, "ING" or the
"Purchaser"),

                              W I T N E S S E T H:

         WHEREAS, the Company desires to obtain financing for the purchase of
charged-off accounts, the making of acquisitions in the Company's existing lines
of business and lines of business reasonably related thereto, and working
capital and general corporate purposes; and

         WHEREAS, the Company has authorized the sale to the Purchaser, and the
Purchaser is willing on the terms and conditions hereinafter set forth
(including Article III) to purchase, directly or through nominees, on the
Closing Date:

                    (a) $10,000,000 principal amount of 12.0% senior promissory
         notes in the form of Exhibit A hereto due January 15, 2007; and

                    (b) Warrants to purchase 428,571 of the Common Shares of the
         Company at an exercise price of $0.01 per share;

         NOW, THEREFORE, the parties hereto agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

         SECTION 1.1 Defined Terms. The following terms (whether or not
italicized) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):

         "1998 Audited Financial Statements" is defined in clause (a) of Section
5.4.

         "1999 Interim Financial Statements" is defined in clause (c) of Section
5.4.

         "Affiliate" means, relative to any Person, any other Person which,
directly or indirectly, controls or is controlled by or under common control
with such Person (excluding, however, any trustee under, or any committee with
responsibility for administering, any Plan). For the purposes of this
definition, "control" (including the correlative terms "controlling",
"controlled by" and "under common control with") means, relative to any Person,
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of Voting Stock, by agreement or otherwise; provided, however, that
(x) beneficial ownership of 15% or more of the

                                       1
<PAGE>   7
Voting Stock of a Person shall be deemed to be control and (y) any of the
foregoing to the contrary notwithstanding, the term "Affiliate," relative to the
Company and Subsidiaries, shall not include ING.

         "this Agreement" means, on any date, this Purchase Agreement as
originally in effect and as thereafter from time to time amended, supplemented
or otherwise modified in accordance with the terms hereof and in effect on such
date.

         "Applicable Law" means, relative to any Person, (x) all provisions of
laws, statutes, ordinances, rules, regulations, requirements, restrictions,
permits, certificates or orders of any Governmental Authority applicable to such
Person or any of its assets or property and (y) all judgments, injunctions,
orders and decrees of all courts in proceedings or actions in which such Person
is a party or by which any of its assets or properties are bound.

         "Approval" means, relative to any Person, each approval, license,
permit, consent, exemption, filing or registration by or with any Governmental
Authority (x) necessary to authorize or permit the execution, delivery or
performance of, or for the validity or enforceability of, any Transaction
Document or (y) that the failure to have or obtain would have a Materially
Adverse Effect on its conduct of its business.

         "Assignment and Acceptance" is defined in Section 4.7.

         "Authorized Officer" means, relative to any Obligor, those of its
officers whose signatures and incumbency shall have been certified to the
Purchaser pursuant to clause (a)(ii) of Section 3.2. or Section 3.5.

         "Bank of America Credit Agreement" means the credit agreement dated as
of July 15, 1999, between Bank of America, N.A. and Midland, as in effect on the
Closing Date or as amended thereafter in accordance with Section 6.2.4.

         "Bank of America Indebtedness" means all Indebtedness of the Company or
Midland under the Bank of America Credit Agreement, or any refinancing or
replacement thereof effected in accordance with Section 6.2.4.

         "Business Day" means any day, excluding, however, a Saturday, Sunday
and each legal holiday on which banks are authorized or required to close in New
York, New York or the State of Kansas.

         "Capitalized Lease Liability" means, relative to any Person, any
monetary obligation under any leasing or similar arrangement which, in
accordance with GAAP, is classified as a capitalized lease, and, for purposes of
this Agreement and each other Purchase Document, the amount of any such
obligation shall be the capitalized amount thereof determined in accordance with
GAAP, and the stated maturity thereof shall be determined in accordance with
GAAP.

         "Capital Stock" means, relative to any Person, any and all shares,
partnership or membership interests, participations, rights or other equivalents
(however designated) of corporate stock, including (w) capital shares of such
Person (whether voting or non-voting), (x) if such Person is a partnership,
capital partnership interests (whether general or limited), (y) any other
indicia of ownership of such Person (z) and all warrants, options, purchase
rights, conversion or exchange rights, voting rights, calls or any claims of any
character with respect thereto.

                                       2
<PAGE>   8
         "Cash Equivalent Investment" means any investment of the following
nature:

                    (a) obligations issued or guaranteed by the United States
         of America;

                    (b) certificates of deposit, overnight time deposits,
         bankers acceptances and other "money market instruments" issued by any
         bank or trust company organized under the laws of the United States of
         America or any State thereof and (x) whose deposits are insured by the
         Federal Deposit Insurance Corporation or (y) having capital and surplus
         in an aggregate amount of not less than $100,000,000;

                    (c) open market commercial paper bearing the highest credit
         rating for such obligations issued by S&P or Moody's or by another
         nationally recognized credit rating firm;

                    (d) repurchase agreements entered into with any bank or
         trust company organized under the laws of the United States of America
         or any State thereof and having capital and surplus in an aggregate
         amount of not less than $100,000,000 relating to United States of
         America government obligations;

                    (e) shares of "money market funds", each having net assets
         of not less than $100,000,000; and

                    (f) other short-term investments calculated in accordance
         with GAAP;

in each (other than clause (f) above) case maturing or being due or payable in
full not more than 180 days after the Company's acquisition thereof.

         "Certificate of Incorporation" means the certificate of incorporation
of the Company in the form furnished to the Purchaser prior to the execution and
delivery of this Agreement, together with all amendments thereto as of the
Closing Date.

         "Change of Control" means:

                    (a) the sale, lease or transfer of all or substantially all
         the assets of the Company to any Person or group (as such term is
         defined in Section 13(d)(3) of the Exchange Act) other than any of the
         Significant Stockholders;

                    (b) the liquidation or dissolution of (or the adoption of a
         plan of liquidation by) the Company; or

                    (c) the acquisition by any Person or affiliated group (other
         than any of the Significant Stockholders) of a direct or indirect
         majority in interest (more than 50%) of the issued and outstanding
         Voting Stock of the Company by way of merger or consolidation or
         otherwise.

         "Closing" is defined in Section 2.3.

                                       3
<PAGE>   9
         "Closing Date" is defined in Section 2.3.

         "Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.

         "Common Share" means a share of common stock, $0.01 par value per
share, of the Company as authorized by the Certificate of Incorporation.

         "Company" is defined in the preamble.

         "Company's Knowledge" means, at any time and relative to any matter,
knowledge which any Authorized Officer of the Company would have after
reasonable inquiry, under the circumstances, of the current employees of the
Company or any Subsidiary who would reasonably be expected to have knowledge
regarding such matter, whether or not such Authorized Officer actually made
inquiry of such employees.

         "Contingent Liability" means, relative to any Person, any agreement,
undertaking or arrangement by which such Person guarantees, endorses or
otherwise becomes or is contingently liable upon (by direct or indirect
agreement, contingent or otherwise, to provide funds for payment, to supply
funds to, or otherwise to invest in, a debtor, or otherwise to assure a creditor
against loss) the Indebtedness, obligation or any other liability of any other
Person (other than by endorsements of instruments in the course of collection),
or guarantees the payment of dividends or other distributions upon the shares of
any other Person. The amount of any Person's Contingent Liability shall
(subject, however, to any limitation set forth therein) be deemed to be the
outstanding principal amount (or maximum principal amount, if larger) of the
Indebtedness, obligation or other liability guaranteed thereby.

         "Contractual Undertaking" means, relative to any Person, any provision
of any debt or equity security issued by it or of any Instrument or undertaking
to which it is a party or by which it or any of its property is bound or
subject.

         "Controlled Group" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Company, are treated as a single employer under Section 414(b) or 414(c) of the
Code or section 4001(b)(1) of ERISA.

         "Default" means any Event of Default or any act, condition or event
which, after notice or lapse of time or both, would constitute an Event of
Default.

         "Disclosure Schedule" means Schedule I hereto.

         "Employee Benefit Plan" means any "employee benefit plan" as defined in
Section 3(3) of ERISA which is covered by ERISA and (x) which is currently
maintained or contributed to by the Company, (y) which was at any time during
the last six years maintained, contributed to or terminated by the Company or
(z) with respect to which there is any potential or outstanding liability of the
Company.

         "Environmental Claim" is defined in clause (b) of Section 5.16.

                                       4
<PAGE>   10
         "Environmental Law" means all present and future Applicable Laws
imposing liability or standards of conduct relating to the environment,
industrial hygiene, land use or the protection of human health and safety,
natural resources, pollution (including Hazardous Materials) or waste
management.

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections.

         "Event of Default" is defined in Section 7.1.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended.

         "First Registration Agreement" means that certain registration rights
agreement, dated June 30, 1999, among the Company, and the other parties that
are a party thereto.

         "Fiscal Quarter" or "FQ" means any period of three consecutive calendar
months comprising a quarter of a Fiscal Year; references to a Fiscal Quarter
with numbers corresponding to a calendar year and a number corresponding to a
Fiscal Quarter (e.g., "1999 FQ 1") refer to such Fiscal Quarter (i.e., the
first) of such Fiscal Year.

         "Fiscal Year" or "FY" means a period of 12 consecutive calendar months
ending on each December 31st; references to a Fiscal Year with a number
corresponding to any calendar year (e.g., "the 1999 Fiscal Year" or "1999 FY")
refer to the Fiscal Year ending on December 31st of such calendar year.

         "F.R.S. Board" means the Board of Governors of the Federal Reserve
System or any successor thereto.

         "GAAP" is defined in Section 1.4.

         "Governmental Authority" means any international, national, federal,
state, provincial, local, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, or any court, in each case
whether of the United States or foreign.

         "Hazardous Material" means:

                    (a) any substances that are defined or listed in, or
         otherwise classified pursuant to, any applicable Environmental Laws as
         "hazardous substances", "hazardous materials", "hazardous wastes",
         "toxic substances", "contaminants", "pollutants" or any other
         formulation intended to define, list or classify substances by reason
         of adverse effects on the environment or deleterious properties such as
         ignitability, corrosivity, reactivity, carcinogenicity, reproductive
         toxicity or "TLCP" toxicity or "EP" toxicity;

                    (b) any oil, petroleum or petroleum derived substances,
         natural gas, natural gas liquids or synthetic gas and drilling fluids,
         produced waters and other wastes associated with the exploration,
         development or production of crude oil, natural gas or geothermal
         resources;

                    (c) any flammable substances or explosives or any
         radioactive materials; or

                                       5
<PAGE>   11
                    (d) any asbestos in any form or electrical equipment which
         contains any oil or dielectric fluid containing levels of
         polychlorinated biphenyls in excess of fifty parts per million.

         "Hedging Liability" means, relative to any Person, all liabilities of
such Person under interest rate and currency swap, cap and collar agreements and
all other Instruments designed to protect such Person against fluctuations in
interest or currency exchange rates.

         "herein", "hereof", "hereto", "hereunder" and similar terms contained
in this Agreement or any other Purchase Document refer to this Agreement or such
other Purchase Document, as the case may be, as a whole and not to any
particular Article, Section, paragraph or provision of this Agreement or such
other Purchase Document.

         "holder" is defined, relative to a Series No. 1 Note, in Section 4.7.4.

         "including" means including without limiting the generality of any
description preceding such term.

         "Indebtedness" means, relative to any Person, without duplication:

                    (a) all obligations of such Person for borrowed money
         (including all notes payable and drafts accepted representing
         extensions of credit) and all obligations evidenced by bonds,
         debentures, notes or other similar instruments on which interest
         charges are customarily paid;

                    (b) all obligations, contingent or otherwise, relative to
         the face amount of all letters of credit, whether or not drawn, and
         bankers' acceptances issued for the account of such Person;

                    (c) all Capitalized Lease Liabilities of such Person;

                    (d) net monetary liabilities of such Person under all
         Hedging Liabilities (calculated, at any time, as the aggregate amount
         (giving effect to any netting agreements) that such Person would be
         required to pay if the agreements giving rise to such Hedging
         Liabilities were terminated at such time);

                    (e) all obligations of such Person to pay the deferred
         purchase price of property or services that, in accordance with GAAP,
         would be included on the liability side of the balance sheet of such
         Person as of the date at which Indebtedness is to be determined;

                    (f) all indebtedness referred to in clause (a), (b), (c),
         (d) or (e) secured by a Lien on property owned or being purchased by
         such Person (including indebtedness arising under conditional sales or
         other title retention agreements), whether or not such indebtedness
         shall have been assumed by such Person or is limited in recourse;
         provided, however, that in the case of any such Indebtedness which is
         by its terms non-recourse to such Person, the amount of such
         Indebtedness shall, for the purpose of this clause, be deemed to be the
         lesser of (x) the aggregate unpaid principal amount of such
         Indebtedness and (y) the fair market value of the property subject to
         such Lien, as determined by such Person in good faith; and

                                       6
<PAGE>   12
                  (g) all Contingent Liabilities of such Person in respect of
         any Indebtedness of any other Person.

         "Indemnified Liabilities" is defined in Section 8.4.

         "Indemnified Party" is defined in Section 8.4.

         "ING" is defined in the preamble.

         "Institutional Holder" means the Purchaser (so long as it or its
nominee shall hold a Series No. 1 Note or other Subject Security) and each other
financial institution which shall hold a Series No. 1 Note or other Subject
Security (excluding, however, any financial institution which is not a
Noteholder and acquired the other Subject Securities held by it in a
distribution to the public or a sale pursuant to Rule 144A under the Securities
Act or as the direct or indirect transferee of other Subject Securities acquired
in such a distribution or sale).

         "Instrument" means any contract, agreement, indenture, mortgage,
document or other writing (whether by formal agreement, letter or otherwise)
under which any obligation is evidenced, assumed or undertaken or any Lien (or
right or interest therein) is granted or perfected.

         "Intellectual Property" is defined in Section 5.13.

         "Investment" means, relative to any Person, all investments by such
Person in any other Person (including Affiliates) in the forms of (v) loans,
advances (excluding, however, commission, travel, indemnity and similar advances
to officers, directors and employees of such Person made in the ordinary course
of business), (w) Contingent Liabilities of such Person incurred with respect to
Indebtedness of any other Person, (x) capital contributions, purchases or other
acquisitions for consideration of Indebtedness, equity interests or other
securities, (y) payments in respect of tax savings or liabilities made by such
Person to or for the benefit of any other Person with whom such Person files a
consolidated tax return which are not reimbursed by such other Person and (z)
any other items that are or would be classified as investments on a balance
sheet prepared in accordance with GAAP. The amount of any Investment shall be
the original principal or capital amount thereof less all returns of principal
or equity, or distributions or dividends paid, thereon and shall, if made by the
transfer or exchange of property other than cash, be deemed to have been made in
an original principal or capital amount equal to the fair value of such property
at the time of such Investment.

         "Lien" means (x) any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other) or preference,
priority or other security agreement, whether or not filed, recorded or
otherwise perfected under Applicable Law to secure any Indebtedness, (y) any
financing statement filed under the Uniform Commercial Code (or comparable law
of any jurisdiction), other than to perfect the sale or purchase of accounts,
and (z) any option or other agreement to sell or to provide any Instrument or
financing statement of the nature referred to in item (x) or (y).

         "Material Contracts" means the agreements and contracts that are
required to be filed by the Company pursuant to Item 601 of Regulation S-K as an
exhibit to any report, registration statement or other filing under the
Securities Act or the Exchange Act.

                                       7
<PAGE>   13
         "Material Subsidiary" means any Subsidiary of the Company that owns or
otherwise holds tangible assets of $10,000 or more.

         "Materially Adverse Effect" means (x) a material adverse effect on the
financial condition, business, assets, operations or properties of the Company
and Subsidiaries, taken as a whole, (y) a material impairment of the ability of
any Obligor to perform its respective payment obligations under the Purchase
Documents to which it is or will be a party or (z) an impairment of the validity
or enforceability of, or a material impairment of the rights, remedies or
benefits available to the Noteholders under, this Agreement or any other
Purchase Document.

         "Midland" means Midland Credit Management, Inc.

         "Non-U.S. Noteholder" is defined in Section 4.10.

         "Noteholder" means at any time each Person (including the Purchaser)
then registered in accordance with Section 2.3, 4.8 or 4.9 as the owner or
holder of a Series No. 1 Note; provided, however, that no Person which is an
Affiliate of the Company (other than Triarc Companies, Inc. or its designee,
excluding the Company and its Subsidiaries) shall be deemed to be a Noteholder
for purposes of Section 8.1 or any other action requiring the consent,
concurrence or other action of each Noteholder.

         "Notice of Redemption" is defined in Section 4.7.

         "Obligation" means all obligations of the Company with respect to the
repayment or performance of all obligations (monetary or otherwise) of the
Company arising under or in connection with the Series No. 1 Notes or under this
Agreement or any other Purchase Document in respect of the Series No. 1 Notes,
the Indebtedness evidenced thereby or to any Person as the holder of a Series
No. 1 Note.

         "Obligor" means the Company or any Subsidiary Guarantor.

         "Operating Lease" is defined in Section 6.2.8.

         "Optional Redemption Price" means, for any portion of the outstanding
principal amount of any Series No. 1 Note, the outstanding principal amount of
such portion of the Series No. 1 Note.

         "or" is not exclusive.

         "Organizational Document" means, relative to any Person, each
instrument that (x) defines its corporate existence, including its articles or
certificate of incorporation, as filed or recorded with an applicable
Governmental Authority or (y) governs its internal affairs, including its
by-laws and all shareholder agreements, voting trusts and similar arrangements
to which it is a party applicable to any of its authorized shares of Capital
Stock, in each case as amended, supplemented or restated.

         "outstanding" means, at any time relative to the Series No. 1 Notes,
any Series No. 1 Notes theretofore issued pursuant to Section 2.3, 4.8 or 4.9
and not surrendered pursuant to Section 4.8 or 4.9 but excluding, however, all
Series No. 1 Notes which are deemed pursuant to Section 4.9 to be not
outstanding.

                                       8
<PAGE>   14
         "Payment Date" means the 15th day of each January and July, commencing
July 15, 2000 or, if any such day is not a Business Day, the next succeeding
Business Day.

         "Payment or Insolvency Default" means a Default pursuant to Section
7.1.1 or 7.1.3.

         "Permitted Lien" means the following types of Liens (other than any
such Lien imposed pursuant to Section 401(a)(29) or 412(n) of the Internal
Revenue Code or by ERISA):

                  (a) Liens for taxes, assessments or governmental charges or
         claims the payment of which is not, at the time, required by Section
         6.1.7;

                  (b) statutory Liens of landlords, Liens of carriers,
         warehousemen, mechanics, suppliers, materialmen and repairmen and other
         like Liens arising in the ordinary course of business for sums not yet
         more than 10 days delinquent or being contested in good faith, if such
         reserve or other appropriate provision, if any, as shall be required by
         GAAP shall have been made therefor;

                  (c) Liens incurred or deposits made in the ordinary course of
         business in connection with workers' compensation, unemployment
         insurance and other types of social security, or to secure the
         performance of tenders, statutory obligations, surety and appeal bonds,
         bids, leases, government contracts, trade contracts, performance and
         return-of-money bonds and other similar obligations (excluding,
         however, obligations for the payment of borrowed money);

                  (d) leases or subleases granted to others not interfering in
         any material respect with the ordinary conduct of the business of the
         Company or any Subsidiary;

                  (e) easements, rights-of-way, restrictions (including zoning
         restrictions), minor defects, encroachments or irregularities in title
         and other similar charges or encumbrances not interfering in any
         material respect with the ordinary conduct of the business of the
         Company or any Subsidiary;

                  (f) any (w) interest or title of a lessor or sublessor under
         any lease, (x) restriction or encumbrance that the interest or title of
         such lessor or sublessor may be subject to, (y) subordination of the
         interest of the lessee or sublessee under such lease to any restriction
         or encumbrance referred to in item (x) or (z) Liens arising from filing
         Uniform Commercial Code financing statements regarding leases;

                  (g) Liens in favor of customs and revenue authorities arising
         as a matter of law to secure payment of customs duties in connection
         with the importation of goods;

                  (h) Liens (including extensions, renewals and replacements
         thereof) upon property acquired (the "acquired property") by the
         Company or any Subsidiary after the Closing Date; provided, however,
         that (w) any such Lien is created solely for the purpose of securing
         Indebtedness representing, or incurred to finance, refinance or refund,
         the cost (including the cost of construction) of the acquired property,
         (x) the principal amount of the Indebtedness secured by such Lien does
         not exceed 100% of the cost of the acquired property, (y) such Lien
         does not extend to or cover any property other than the acquired
         property and any improvements on such

                                       9
<PAGE>   15
         acquired property and (z) the incurrence of the Indebtedness to
         purchase the acquired property is permitted by Section 6.2.2;

                  (i) Liens encumbering deposits made to secure obligations
         arising from statutory, regulatory, contractual or warranty
         requirements;

                  (j) Liens arising out of consignment or similar arrangements
         for the sale of goods entered into by the Company or any Subsidiary in
         the ordinary course of business;

                  (k) judgment and attachment Liens not giving rise to an Event
         of Default; and

                  (l) additional Liens granted by the Company or any Subsidiary
         at any one time outstanding in respect of properties or assets having,
         on the date such Lien is granted, an aggregate fair market value not to
         exceed $100,000.

         "Person" means any natural person, corporation, firm, association,
partnership, limited liability partnership, limited liability company,
government, trust, governmental agency or any other entity, whether acting in an
individual, fiduciary or other capacity.

         "PIK Notes" is defined in clause (b) of Section 4.4.

         "Plan" means (x) a "pension plan," as such term is defined in section
3(2) of ERISA, which is subject to Title IV of ERISA (other than a multiemployer
plan as defined in section 4001(a)(3) of ERISA), and to which the Company or any
corporation, trade or business that is, along with the Company, a member of a
Controlled Group, may have liability, including any liability by reason of
having been a substantial employer within the meaning of section 4063 of ERISA
at any time during the preceding five years, or by reason of being deemed to be
a contributing sponsor under section 4069 of ERISA or (y) a "welfare plan," as
such term is defined in section 3(1) of ERISA.

         "Purchase Document" means this Agreement, the Series No. 1 Notes, the
Warrant Agreement, the Subsidiary Guaranty and each other Instrument executed
and delivered from time to time by the Company or any Subsidiary to the
Purchaser or any other Noteholder pursuant hereto, whether or not mentioned
herein.

         "Purchaser" is defined in the preamble.

         "Ratably" means, relative to the Noteholders, ratably according to the
aggregate outstanding principal amount of all Series No. 1 Notes held by each
Noteholder.

         "Registration Agreement" means that certain Registration Rights
Agreement, dated as of January 12, 2000, by and between the Company and the
Purchaser.

         "Reimbursement Agreement" means the reimbursement agreement, dated as
of January 12, 2000, between the Company and Midland.

         "Required Noteholders" means, at any time, Noteholders owning more than
50% of the then outstanding principal amount of the Series No. 1 Notes;
provided, however, that any Series No. 1 Note

                                       10
<PAGE>   16
which from time to time is held by any Affiliate of the Company (other than
Triarc Companies, Inc. or any of its designees, excluding the Company and its
Subsidiaries) shall be deemed to be not outstanding for all purposes of (x)
Sections 7.3 and 8.1 and (y) any other determination to be made by, or action to
be taken by or at the direction of, the Required Noteholders.

         "Residual Transaction" is defined in clause (e) of Section 6.2.2.

         "Restricted Payment" means

                  (a) relative to any Capital Stock of the Company,

                           (i) any dividend or other distribution (in cash,
                  property or obligations), direct or indirect, by the Company
                  on account of (x) any shares of any class of such Capital
                  Stock (now or hereafter outstanding) or (y) any warrants,
                  options or other rights with respect to any shares of any
                  class of such Capital Stock (now or hereafter outstanding),
                  excluding, however, in each case, dividends or distributions
                  payable in such Capital Stock, or warrants to purchase such
                  Capital Stock, or split-ups or reclassifications of such
                  Capital Stock into additional or other shares of its Capital
                  Stock,

                           (ii) any redemption, retirement, sinking fund or
                  similar payment, purchase or other acquisition for value,
                  direct or indirect, by the Company or any Subsidiary of any
                  shares of any class of such Capital Stock (now or hereafter
                  outstanding), and

                           (iii) any payment by the Company or any Subsidiary
                  made to retire, or to obtain the surrender of, any outstanding
                  warrants, options or other rights to acquire shares of any
                  class of such Capital Stock now or hereafter outstanding;

                  (b) any payment or prepayment by the Company or any Subsidiary
         of principal of, premium, if any, or interest on, or redemption,
         purchase, retirement, defeasance (including in-substance or legal
         defeasance), sinking fund or similar payment with respect to, any
         Indebtedness subordinated in right of payment to the Obligations; and

                  (c) any deposit to fund any of the foregoing.

         "SEC" means the Securities and Exchange Commission.

         "Securities Act" means the Securities Act of 1933, as amended.

         "Securitization Subsidiary" means any of Midland Receivables 98-1
Corporation, Midland Receivables 99-1 Corporation or Midland Funding 98-A
Corporation or any other bankruptcy-remote Subsidiary created or acquired by the
Company or any Subsidiary for the purpose of securitizing or otherwise selling,
pledging or borrowing against charged-off accounts in the ordinary course of
business.

         "Securitization Transaction" means any transaction or series of
transactions by or through a Securitization Subsidiary for the purpose of
securitizing or otherwise selling, pledging or borrowing against charged-off
accounts in the ordinary course of business.

                                       11
<PAGE>   17
         "Series No. 1 Note" means each 12.0% senior promissory note of the
Company issued on the Closing Date in accordance with Section 2.3, and any PIK
Notes issued pursuant to Section 4.4, in each case substantially in the form of
Exhibit A hereto (as such note may be amended, endorsed or otherwise modified
from time to time) and all other notes accepted from time to time in
substitution, replacement or renewal therefor, including pursuant to Section 4.8
or 4.9.

         "Significant Stockholders" means, collectively, Nelson Peltz, Peter W.
May, Triarc Companies, Inc., C.P. International Investments Limited, Peter N.S.
Frazer and Frank Chandler, or any of their Affiliates.

         "Subject Security" means all Series No. 1 Notes and other securities
purchased on the Closing Date pursuant to Section 2.3, together with all other
securities issued in replacement or exchange therefor or as a distribution
thereon.

         "Subsidiary" means, relative to any Person, (x) any corporation,
association or other business entity more than 50.0% of the outstanding shares
of Voting Stock of which is owned directly or indirectly by such Person and (y)
any partnership in which such Person is a general partner (but not including any
trust unless the applicable Person owns more than 50% beneficial interest
therein as evidenced by issued certificates). Except as otherwise indicated
herein, references to Subsidiaries refer to Subsidiaries of the Company.

         "Subsidiary Guaranty" is defined in Section 6.1.6.

         "Subsidiary Guarantor" means each Subsidiary that shall from time to
time after the Closing Date become a party to the Subsidiary Guaranty in
accordance with Section 6.1.6.

         "Tax" is defined in Section 4.10.

         "Transaction" means collectively:

                  (a) the issuance by the Company of the Subject Securities in
         accordance with this Agreement; and

                  (b) all of the other transactions contemplated by the parties
         hereto (including in accordance with Article III) to occur on the
         Closing Date, including the payment of Transaction Costs.

         "Transaction Cost" means any reasonably incurred fee, cost or expense
payable by the Company or any Subsidiary in connection with the Transaction.

         "Transaction Documents" means the Purchase Documents, the Registration
Agreement and all documents, certificates and Instruments delivered in
connection with any thereof.

                                       12
<PAGE>   18
         "Voting Stock" means, relative to any Person, Capital Stock of any
class or kind, including any Capital Stock of such Person of any other class or
kind which is then convertible into Capital Stock of such class or kind,
ordinarily having the power to vote (and irrespective of whether at the time
Capital Stock of such Person of any other class or kind shall or might upon the
occurrence of a contingency have voting power) for the election of directors,
managers or other voting members of the governing body of such Person.

                                       13
<PAGE>   19
         "Warrant" means a warrant issued by the Company substantially in the
form of Attachment 1 to the Warrant Agreement (as such warrant may be amended,
endorsed or otherwise modified from time to time) and all other warrants
accepted from time to time in substitution, replacement or renewal therefor,
including pursuant to Section 2.2 or 2.3 thereof.

         "Warrant Agreement" means an agreement between the Company and the
Purchaser substantially in the form of Exhibit E hereto as such agreement may be
amended, waived or otherwise modified from time to time in accordance with its
terms.

         "wholly-owned Subsidiary" means, relative to any Person, any Subsidiary
of such Person all of the Capital Stock (and all rights and options to purchase
such Capital Stock) of which, other than directors' qualifying shares, are
owned, beneficially and of record, by such Person or its wholly-owned
Subsidiaries.

         "Year 2000 Problem" means, relative to any Person, any significant risk
that computer hardware, software or equipment containing embedded microchips
used in its businesses or operations will not, in the case of dates of time
periods occurring after December 31, 1999, function at least as effectively as
in the case of dates or time periods occurring prior to January 1, 2000.

         SECTION 1.2  Use of Defined Terms. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule, each
Series No. 1 Note and any other Purchase Document or any notice or other
communication delivered from time to time in connection with any Purchase
Document.

         SECTION 1.3  Cross References. Unless otherwise specified, references
in this Agreement and in each other Purchase Document to any Article or Section
are references to such Article or Section of this Agreement or such other
Purchase Document, as the case may be, and unless otherwise specified,
references in any Article, Section or definition to any item or clause are
references to such item or clause of such Article, Section or definition.

         SECTION 1.4  Accounting and Financial Determinations. Unless otherwise
specified, all accounting terms used herein or in any other Purchase Document
shall be interpreted, all accounting determinations and computations hereunder
or thereunder for periods after the Closing Date shall be made and all financial
statements required to be delivered hereunder or thereunder shall be prepared,
in accordance with generally accepted accounting principles ("GAAP") (subject,
however, in the case of financial information as at the close of any period
other than a Fiscal Year, to the absence of footnotes and year-end adjustments)
as in effect at such time and applied consistently with the 1998 Audited
Financial Statements (except as disclosed therein).

                                       14
<PAGE>   20
                                   ARTICLE II

                        PURCHASE AND SALE OF SECURITIES

         SECTION 2.1  Purchase Commitment. The Purchaser hereby agrees,
subject, however, to the terms and conditions of this Agreement (including
Article III), to purchase from the Company, and the Company hereby agrees to
sell to the Purchaser, at the Closing the following securities:

                  (a) $10,000,000 principal amount of Series No. 1 Notes, at
         par; and

                  (b) for consideration of $10.00, a Warrant to purchase 428,571
         of the Company's Common Shares, exercisable for a period of five years
         at an exercise price of $0.01 per share.

         SECTION 2.2  Issue Price. The Company and the Purchaser agree that,
for purposes of section 1271 et seq. of the Code, the issue price of each Series
No. 1 Note and the issue price of the Warrant shall be determined by the Company
in good faith and shall be provided to the Purchaser promptly thereafter but in
no event more than 45 days after the Closing Date.

         SECTION 2.3  Closing. The purchase of the Series No. 1 Notes and the
other Subject Securities shall take place at a closing (the "Closing") at the
offices of Mayer, Brown & Platt, 1675 Broadway, New York, New York, at 10:00
a.m., local time, on January 12, 2000 or such other Business Day as may be
agreed upon by the Company and the Purchaser (the "Closing Date"). At the
Closing, the Company will deliver to the Purchaser:

                  (a) a single Series No. 1 Note (or such greater number of
         Series No. 1 Notes as the Purchaser may request) in the aggregate
         principal amount set forth in clause (a) of Section 2.1, dated the
         Closing Date, and registered in the Purchaser's name (or in the name of
         one or more nominees of the Purchaser), and

                  (b) a Warrant (or such greater number of Warrants as the
         Purchaser may request) representing in the aggregate the right to
         purchase the number of Common Shares set forth in clause (b) of Section
         2.1, dated the Closing Date, and registered in the Purchaser's name (or
         in the name of one or more nominees of the Purchaser),

each against delivery by the Purchaser to the Company of immediately available
funds in the amount of the purchase price therefor. If, at the Closing, the
Company shall fail to tender to the Purchaser the Subject Securities as provided
in this Section or any of the conditions specified in Article III shall not have
been fulfilled to the Purchaser's reasonable satisfaction, the Purchaser shall,
at its election, be relieved of all further obligations under this Agreement,
without thereby waiving any other rights the Purchaser may have by reason of
such failure or such nonfulfillment.

                                       15
<PAGE>   21
                                   ARTICLE III

                             CONDITIONS TO CLOSING

         The Purchaser's obligation to purchase and pay for the Subject
Securities is subject, however, to the fulfillment, to the Purchaser's
satisfaction, prior to, at or concurrently with the Closing, of all of the
following conditions:

         SECTION 3.1  Certificate of Incorporation. Each of the following shall
have occurred (and the Purchaser shall have received from the Company a
certificate, dated the Closing Date, of its Secretary or Assistant Secretary
substantially in the form of Exhibit B hereto confirming inter alia that):

                  (a) the Company shall have adopted and duly filed with the
         Secretary of State of Delaware the Certificate of Incorporation; and

                  (b) no further amendments or modifications thereto shall have
         been adopted or filed.

         SECTION 3.2  Resolutions, etc. The Purchaser shall have received:

                  (a) from the Company, a certificate, dated the Closing Date,
         in the form of Exhibit C hereto as to:

                           (i) resolutions of its Board of Directors then in
                  full force and effect authorizing in the case of the Company,
                  the issuance of the Subject Securities and the execution,
                  delivery and performance of this Agreement and each other
                  Purchase Document to be executed by it, and

                           (ii) 3.2.0.1.2. the incumbency and signatures of
                  those of its officers authorized to act with respect to this
                  Agreement and each other Purchase Document executed by it;

                  (b) duly executed and delivered counterparts of the
         Registration Agreement; and

                  (c) the balance sheets and financial statements identified in
         clauses (a) through (d) of Section 5.4 together with all other
         financial information reasonably requested by the Purchaser, who shall
         be satisfied with the same in its sole discretion.

         SECTION 3.3  Series No. 1 Note. The Company shall have executed and
delivered to the Purchaser a Series No. 1 Note, dated the Closing Date, in the
original principal amount provided in clause (a) of Section 2.1 with interest
payable thereon at the rates determined in accordance with Section 4.4.

         SECTION 3.4  Warrants. The Company shall have exchanged duly executed
counterparts of the Warrant Agreement with the Purchaser and shall have issued
pursuant thereto to the Purchaser, a Warrant, dated the Closing Date, for the
number of Common Shares provided in clause (b) of Section 2.1.

                                       16
<PAGE>   22
         SECTION 3.5  Guaranties. The Purchaser shall have received from each
Subsidiary Guarantor, a duly authorized and executed Subsidiary Guaranty,
together with appropriately completed certificates similar in form and substance
to Exhibits B and C hereto.

         SECTION 3.6  Material Contracts. The Purchaser shall have received from
the Company true, correct and completed copies of all Material Contracts
(including but not limited to the Reimbursement Agreement, the First
Registration Agreement, the indenture and servicing agreements for all
Securitization Transactions as of the Closing Date, and the Bank of America
Credit Agreement) as executed by the parties thereto, including all schedules
thereto appropriately completed. The Material Contracts, including the schedules
thereto, shall be in form and substance reasonably acceptable to the Purchaser.

         SECTION 3.7  Performance; No Default. At the time of the Closing (and
after giving effect to the Transaction),

                  (a) the representations and warranties of the Company
         contained in this Agreement and those made in writing by or on behalf
         of the Company in connection with any other Purchase Document delivered
         on the Closing Date shall be true and correct;

                  (b) the Company shall have performed and complied with all
         agreements and conditions contained in this Agreement required to be
         performed or complied with by it prior to or at the Closing; and

                  (c) no Default shall have occurred and be continuing.

         SECTION 3.8  Absence of Litigation, etc. Except as disclosed by the
Company pursuant to Section 5.8,

                  (a) no litigation, arbitration or governmental investigation
         or proceeding shall be pending or, to the Company's Knowledge,
         threatened against the Company or any Subsidiary which (x) affects any
         of their respective financial condition, business, assets, operations
         or properties and which would, in the opinion of the Purchaser,
         reasonably be expected to have a Materially Adverse Effect or (y)
         relates to the Transaction; and

                  (b) no development shall have occurred in any such litigation,
         arbitration or governmental investigation or proceeding so disclosed,
         which would, in the opinion of the Purchaser, reasonably be expected to
         have a Materially Adverse Effect.

         SECTION 3.9  Certificate as to Compliance, etc. The Purchaser shall
have received from the Company a certificate, dated the Closing Date, of its
chief executive or financial Authorized Officer as to satisfaction of the
conditions set forth in Sections 3.7 and 3.8 in the form of Exhibit G hereto.

         SECTION 3.10  Certificate as to Solvency, etc. The Purchaser shall have
received a certificate, dated the Closing Date, of the chief financial
Authorized Officer of the Company, in the form of Exhibit H hereto.

                                       17
<PAGE>   23
         SECTION 3.11  Opinion of Counsel. The Purchaser shall have received
opinions, dated the Closing Date, from Squire, Sanders & Dempsey L.L.P., counsel
to the Company and the Subsidiary Guarantors, substantially in the form of
Exhibit I hereto.

         SECTION 3.12  Fees. The Company shall have made payment in full of:

                  (a) all fees and other amounts due on the Closing Date to the
         Purchaser by the Company in connection with the Transaction; and

                  (b) all fees and expenses of Mayer, Brown & Platt which shall
         have been invoiced (including reasonable amounts invoiced on account)
         to the Company pursuant to Section 8.3.

         SECTION 3.13  Wire Instructions. The Purchaser shall have received,
not less than two Business Days prior to the Closing Date, wire instructions
prepared by the Company as to all wire transfers or other payments to be
effected on the Closing Date in connection with the Transactions to be
consummated on the Closing Date pursuant to this Agreement or the other
Transaction Documents, which wire instructions shall identify the payor and
payee of each such wire transfer or payment, shall describe the manner of
transfer or payment and shall otherwise be satisfactory in form and substance to
the Purchasers.

         SECTION 3.14  Due Diligence. The Purchaser shall have completed, to its
reasonable satisfaction, an investigation and analysis of the legal affairs and
Contractual Undertakings of the Company and its Subsidiaries.

         SECTION 3.15  Legal Investment. On the Closing Date, the Purchaser's
purchase of the Subject Securities shall not be prohibited by any Applicable Law
and shall not subject it to any penalty or, in the Purchaser's reasonable
judgment, other onerous condition under or pursuant to any Applicable Law.

         SECTION 3.16  Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of the Company shall be satisfactory
in form and substance to the Purchaser and its counsel; the Purchaser and its
counsel shall have received all information, and such counterpart originals or
such certified or other copies of all Instruments, as the Purchaser or its
counsel may reasonably request; and all legal matters incident to the
transactions contemplated by this Agreement shall be satisfactory to counsel to
the Purchaser.

         SECTION 3.17  Approvals, etc. The Company shall have received (i) all
Approvals, and (ii) any consent of third-parties required under any Contractual
Undertaking of the Company or any Subsidiary have been obtained or given, in
each case in connection with the Transaction.

                                       18
<PAGE>   24
                                   ARTICLE IV

                          PAYMENTS, REGISTRATION, ETC.

         SECTION 4.1 Place of Payment. Payments of principal and interest
becoming due and payable on the Series No. 1 Notes and any dividends or other
payments on or in respect of any other Subject Securities shall be made to the
Purchaser's account identified on the signature page hereto at the office of The
Chase Manhattan Bank, 5 Metrotech Center, Brooklyn, New York.

         SECTION 4.2 Home Office Payment. So long as the Purchaser or its
nominee shall be the holder of any Subject Security, and notwithstanding
anything contained in Section 4.1 or in any Subject Security to the contrary,
the Company will pay all sums becoming due for principal of and interest on such
Series No. 1 Note so held and all dividends or other payments on or in respect
of any other Subject Security so held, not later than 12:00 o'clock noon, New
York City time, on the date such payment is due, in immediately available funds,

                  (a) in accordance with the payment instructions set forth
         below the Purchaser's signature hereto with instructions to the payee
         identified in such instructions to telephone advice of credit in
         accordance with such instructions, or

                  (b) by such other method or at such other address or bank
         account as the Purchaser may designate in writing,

without the presentation or surrender of such Subject Security or the making of
any notation thereon, except that any Series No. 1 Note paid or prepaid (or any
other Subject Security redeemed) in full shall be surrendered to the Company at
its principal office for cancellation. Prior to any sale or other disposition of
any Series No. 1 Note held by the Purchaser, the Purchaser will, at its
election, either endorse thereon the amount of principal paid thereon and the
last date to which interest has been paid thereon or surrender such Series No. 1
Note to the Company in exchange for a new Series No. 1 Note or Series No. 1
Notes, as the case may be, pursuant to Section 4.8. The Company will afford the
benefits of this Section to any Institutional Holder which is the direct or
indirect transferee of any Subject Security purchased by the Purchaser under
this Agreement and which has made the same agreement relating to such Subject
Security as the Purchaser has made in this Section.

         SECTION 4.3 Optional Payments. The Company may, at its option, prepay
at any time all or any part (in a minimum amount of $100,000 and integral
multiples of $1,000 thereafter) of the outstanding principal amount of, or of
interest due or to become due on the next Payment Date under, the Series No. 1
Notes. Prepayments of principal shall be in the amount of the applicable
Optional Redemption Price and shall be accompanied by payment in full of all
interest accrued on such principal amount and not yet paid. Each prepayment
shall be subject, however, to the Company having given each Noteholder written
notice of such prepayment not more than 30 days and not less than five days
prior to the date fixed for such prepayment, in each case specifying (w) such
date, (x) the aggregate principal amount, if any, of (and the amount of unpaid
interest accrued on such principal amount), or the amount of unpaid interest

                                       19
<PAGE>   25
on, the Series No. 1 Notes to be prepaid on such date, (y) the principal amount,
if any, of (and the amount of unpaid interest accrued on such principal amount),
or the amount of unpaid interest on, each Series No. 1 Note held by such
Noteholder to be prepaid on such date and (z) the Optional Redemption Price
applicable to such prepayment.

         SECTION 4.4 Payment of Principal and Interest.

                  (a) Payment of Maturity. The Company will duly and punctually
         pay the principal of and interest on the Series No. 1 Notes, and will
         timely pay and perform all of its other Obligations, in accordance with
         the terms of such Series No. 1 Notes, this Agreement and the other
         Purchase Documents, and, without limitation of the foregoing, the
         Company will, on the maturity of all Series No. 1 Notes (whether on
         January 15, 2007 or by declaration (pursuant to Section 7.3) or
         otherwise), make payment in full to the holders of the Series No. 1
         Notes of the unpaid principal balance thereof, to the extent not sooner
         paid or prepaid hereunder, together with all unpaid interest and fees
         accrued thereon and all expenses, indemnities and other amounts then
         due and payable under the terms of the Series No. 1 Notes, this
         Agreement or the other Purchase Documents.

                  (b) Interest. The Series No. 1 Notes will bear interest, prior
         to the occurrence of any Default pursuant to Section 7.1.1 relating to
         the non-payment of principal of or interest on the Series No. 1 Notes,
         at a rate of 12.0% per annum. Interest so accrued will be payable in
         arrears on each Payment Date, commencing with July 15, 2000 and at
         maturity; provided, that on any Payment Date on or prior to January 15,
         2002, the Company may (in lieu of making any required cash payment of
         interest on any outstanding Series No. 1 Notes) issue on such date, and
         each Person then entitled to payment of interest shall accept, a Series
         No. 1 Note (a "PIK Note") in a principal amount equal to the interest
         owed to such Person on such Payment Date. All PIK Notes shall have a
         maturity date of July 1, 2005. At any time when the Company shall have
         defaulted in the payment when due (whether at maturity, or at a date
         fixed for payment or prepayment or by declaration or otherwise) of
         principal of or interest on the Series No. 1 Notes (and for so long as
         such default shall continue), the Series No. 1 Notes will bear
         interest, payable semi-annually as aforesaid or at the option of a
         Noteholder on demand, at a rate equal to the sum of the foregoing rate
         plus an additional 2% per annum on the entire unpaid balance of such
         principal amount, on overdue premium, if any, and (to the extent
         permitted by applicable law) on overdue interest.

         SECTION 4.5 Allocation. Each partial prepayment paid or to be prepaid
of principal of the Series No. 1 Notes and each prepayment of interest paid or
to be prepaid shall be allocated (in integral multiples of $1,000) among all of
the Series No. 1 Notes at the time outstanding in proportion, as nearly as
practicable, to the respective unpaid principal amounts thereof. In the case of
each voluntary prepayment of principal of or interest on the Series No. 1 Notes,
the principal amount to be prepaid, if any, (together with interest on such
principal amount accrued to such date), or the amount of interest to be prepaid,
as the case may be, shall mature and become due and payable on the date fixed
for such prepayment. From and after the date of any such prepayment of
principal, unless the Company shall fail to pay such principal amount when so
due and payable, together with the interest, as aforesaid, interest on such
principal amount shall cease to accrue. Any Series No. 1 Note paid or prepaid in
full shall be surrendered to the Company and cancelled and shall not be
reissued, and no Series No. 1 Note shall be issued in lieu of any prepaid
principal amount of any Series No. 1 Note.

                                       20
<PAGE>   26
         SECTION 4.6 Mandatory Offer of Redemption of Series No. 1 Notes. Upon
the earliest to occur of:

                  (a) any Change of Control,

                  (b) the Company entering into any written or other arrangement
         which will give rise to a Change of Control, or

                  (c) the Company having notice that any other Person has
         entered into a written or other arrangement which will give rise to a
         Change of Control,

the Company will promptly give written notice of such transaction or event to
each Noteholder, which notice shall describe such transaction or event in
reasonable detail. Within five (5) Business Days following the occurrence of any
Change of Control, the Company will offer to purchase from each Noteholder all
of the outstanding Series No. 1 Notes held by it at a purchase price, payable in
immediately available funds, equal to the Optional Redemption Price of the
unpaid principal amount thereof together with all unpaid interest accrued
thereon to the date of such purchase.

         SECTION 4.7 Assignments by Noteholders. Each Noteholder may assign to
one or more financial institutions that are accredited investors all or a
portion of its rights and obligations under Series No. 1 Notes, this Agreement
and all other agreements executed in connection therewith (pursuant to the terms
and conditions of such agreements); provided, however, that in the case of each
such assignment of a Series No. 1 Note, the principal amount assigned shall be
equal to or greater than $1,000,000 or, if less, such Noteholder's entire amount
of its Series No. 1 Note(s); provided further, however, that such Noteholder
shall give the Company no less than five Business Days written notice of such
prospective assignment, upon the receipt of which the Company shall have three
Business Days to give such Noteholder written notice (the "Notice of
Redemption") stating that the Company shall redeem or prepay the portion of such
Series No. 1 Note(s) or portion to be assigned in accordance with Section 4.3
within ten Business Days after such Noteholder's receipt of the Notice of
Redemption. The parties to each such assignment shall execute and deliver to the
Company, for its recording in the register kept by it pursuant to Section 4.7.4,
an assignment and acceptance agreement (the "Assignment and Acceptance")
substantially in the form of Exhibit F hereto, together with any Series No. 1
Note or Series No. 1 Notes subject to such assignment.

         SECTION 4.7.1 Consent to Certain Assignments. The consent of the
Company is not required for a Noteholder to assign all or a portion of the
rights and obligations under this Agreement, provided that (i) all conditions
set forth in Section 4.7 have been satisfied, and (ii) only Noteholders and
Institutional Holders may have any rights under this Agreement.

         SECTION 4.7.2 Procedures. Upon any assignment of Series No. 1 Notes,
and the execution and delivery by any Noteholder of an Assignment and Acceptance
to the Company,

                  (a) the assignee thereunder shall, automatically and without
         further action, become a party hereto and, to the extent that rights
         and obligations hereunder or under any other Purchase Document have
         been assigned to it pursuant to such Assignment and Acceptance, shall
         have all rights, obligations and benefits of a Noteholder; and

                                       21
<PAGE>   27
                  (b) the assignor thereunder shall, to the extent that rights
         and obligations hereunder have been assigned by it pursuant to such
         Assignment and Acceptance, relinquish its rights and be released (other
         than the final paragraph of Section 6.1.1 which assignor shall continue
         to be bound thereto) from its obligations under this Agreement and
         under each other Purchase Document (and, in the case of an Assignment
         and Acceptance covering all or the remaining portion of an assigning
         Noteholder's rights and obligations under this Agreement, such
         assigning Noteholder shall cease to be a party hereto; provided that
         the obligations of the Company to such assigning Noteholder under
         Sections 4.10, 8.3 and 8.4 with respect to events occurring or
         obligations arising before such assignment shall survive such
         assignment).

         SECTION 4.7.3 Terms and Conditions. By executing and delivering an
Assignment and Acceptance, each of the assignor and assignee thereunder confirm
to and agree with each other and the other parties hereto as follows:

                  (a) other than as provided in such Assignment and Acceptance,
         such assignor makes no representation or warranty and assumes no
         responsibility with respect to any statements, warranties or
         representations made in or in connection with this Agreement or any
         other Purchase Document or the execution, legality, validity,
         enforceability, genuineness, sufficiency or value of this Agreement,
         the assigned Series No. 1 Note, any Purchase Document or any other
         Instrument furnished pursuant hereto;

                  (b) such assigning Purchaser makes no representation or
         warranty and assumes no responsibility with respect to the financial
         condition of the Company or any Subsidiary or the performance or
         observance by any party hereto or thereto of any of its obligations
         under this Agreement or any other Purchase Document or any other
         Instrument furnished pursuant hereto;

                  (c) such assignee confirms that it has received a copy of this
         Agreement, together with copies of the financial statements referred to
         in Sections 5.4 and 6.1.1 (to the extent theretofore delivered) and
         such other documents and information as it has deemed appropriate to
         make its own credit analysis and decision to enter into such Assignment
         and Acceptance; and

                  (d) such assignee will, independently and without reliance
         upon any Person and based on such documents and information as it shall
         deem appropriate at the time, continue to make its own credit decisions
         in taking or not taking action under this Agreement.

         SECTION 4.7.4 Registration, Transfer, etc. The Company will keep at
its principal office a register in which the Company will provide for the
registration of the Series No. 1 Notes and their transfer. The Company may treat
the Person in whose name any Series No. 1 Note is registered on such register as
the owner thereof for the purpose of receiving payment of the principal of and
interest on such Series No. 1 Note and for all other purposes, whether or not
such Series No. 1 Note shall be overdue, and the Company shall not be affected
by any notice to the contrary from any Person other than the applicable
Noteholder. All references in this Agreement to a "holder" of any Series No. 1
Note shall mean the Person in whose name such Series No. 1 Note is at the time
registered on such register.

         SECTION 4.8 Transfer and Exchange. Upon surrender of any Series No. 1
Note for registration of transfer or for exchange to the Company at its
principal office, the Company at its expense will execute and deliver in
exchange therefor a new Series No. 1 Note or Series No. 1 Notes, as the case

                                       22
<PAGE>   28
may be, of the same class in denominations of at least $100,000 (except a Series
No. 1 Note may be issued in a lesser principal amount if the unpaid principal
amount of the surrendered Series No. 1 Note is not evenly divisible by, or is
less than, $100,000), as requested by the holder or transferee, which aggregate
the unpaid principal amount of such Series No. 1 Note, registered as such holder
or transferee may request, dated so that there will be no loss of interest on
such surrendered Series No. 1 Note and otherwise of like tenor.

         SECTION 4.9 Replacement. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of any
Series No. 1 Note and, in the case of any such loss, theft or destruction of any
Series No. 1 Note, upon delivery of an indemnity bond in such reasonable amount
as the Company may determine (or, in the case of any Series No. 1 Note or Series
No. 1 Notes held by the Purchaser or another Institutional Holder or the
Purchaser's nominee, of an unsecured indemnity agreement from the Purchaser or
such other holder reasonably satisfactory to the Company), or, in the case of
any such mutilation, upon the surrender of such Series No. 1 Note for
cancellation to the Company at its principal office, the Company at its expense
will execute and deliver, in lieu thereof, a new Series No. 1 Note of the same
class and of like tenor, dated so that there will be no loss of interest on (and
registered in the name of the holder of) such lost, stolen, destroyed or
mutilated Series No. 1 Note. Any Series No. 1 Note in lieu of which any such new
Series No. 1 Note has been so executed and delivered by the Company shall be
deemed to be not outstanding for any purpose of this Agreement.

         SECTION 4.10 Taxes. Except as otherwise provided in this Section, all
payments by the Company of principal of, and interest on, the Series No. 1
Notes, and all other amounts payable hereunder shall be made free and clear of
and without deduction for any present or future income, excise, stamp or
franchise taxes and other taxes, fees, duties, withholdings or other charges of
any nature whatsoever imposed by any taxing authority, excluding, however,
franchise taxes and taxes imposed on or measured by the Purchaser's or any other
Noteholder's net income or receipts (such non-excluded items being called
"Taxes"). In the event that any withholding or deduction from any payment to be
made by the Company hereunder is required in respect of any Taxes pursuant to
any Applicable Law, then, the Company will:

                  (a) pay directly to the relevant authority the full amount
         required to be so withheld or deducted;

                  (b) promptly forward to the Purchaser and each other
         Noteholder an official receipt or other documentation satisfactory to
         the Purchaser and each other Noteholder evidencing such payment to such
         authority; and

                  (c) except as otherwise provided in this Section, pay to the
         Purchaser and each other Noteholder such additional amount or amounts
         as is necessary to ensure that the net amount actually received by each
         Noteholder will equal the full amount such Noteholder would have
         received had no such withholding or deduction been required.

Moreover, if any Taxes are directly asserted against the Purchaser or any
Noteholder with respect to any payment received by the Purchaser or such
Noteholder hereunder, the Purchaser or such Noteholder may pay such Taxes, and,
except as otherwise provided in this Section, upon receipt of written evidence
of such payment, the Company will promptly pay such additional amount (including
any penalties, interest or expenses) as is necessary in order that the net
amount received by the Purchaser or such Noteholder

                                       23
<PAGE>   29
after the payment of such Taxes (including any Taxes on such additional amount)
shall equal the amount the Purchaser or such Noteholder would have received had
no such Taxes been asserted.

         If the Company fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Purchaser and the other Noteholders
the required receipts or other required documentary evidence, the Company shall
indemnify the Purchaser and the other Noteholders for any incremental Taxes,
interest or penalties that may become payable by the Purchaser or any other
Noteholder as a result of any such failure. For purposes of this Section, a
distribution hereunder by the Purchaser or any other Noteholder to or for the
account of any Noteholder shall be deemed a payment by the Company.

         The Purchaser shall provide to the Company on or prior to the due date
of the first payment under the Series No. 1 Notes, two original signed copies of
Internal Revenue Service Form 4224 or Form 1001 or any successor form certifying
to the Purchaser's entitlement to a complete exemption from United States
withholding tax with respect to payments of interest to be made under this
Agreement and under any Series No. 1 Note. Any Noteholder which is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) for
U.S. Federal income tax purposes (a "Non-U.S. Noteholder") that becomes a
Noteholder under this Agreement after the Closing shall, upon the date of such
Noteholder becoming a Noteholder hereunder, provide to the Company two original
signed copies of Internal Revenue Service Form 4224 or Form 1001 or any
successor form certifying as to such Noteholder's entitlement to a complete
exemption from United States withholding tax with respect to payments of
interest to be made under this Agreement and under any Series No. 1 Note;
provided, however, that if such Non-U.S. Noteholder is an Affiliate of the
Purchaser and is organized under the laws of the same jurisdiction as the
Purchaser, such Noteholder will only be required to deliver such forms
certifying as to such Noteholder's entitlement to the same exemption from such
withholding tax to which the Purchaser would be entitled with respect to such
payments as of such date. To the extent legally entitled to do so, on or before
the date any such form expires or becomes obsolete or after the occurrence of
any event requiring a change in the most recent form previously delivered by it
to the Company, and otherwise from time to time upon the reasonable written
request of the Company after the Closing, each Noteholder (including the
Purchaser) that is a Non-U.S. Noteholder will provide to the Company two
original signed copies of Internal Revenue Service Form 4224 or Form 1001 (or
any successor forms) certifying to such Noteholder's entitlement to an exemption
from United States withholding tax with respect to payments of interest to be
made under this Agreement and under any Series No. 1 Note.

         Notwithstanding anything to the contrary contained in this Section, the
Company shall be entitled, to the extent it is required to do so by law, to
deduct or withhold income or similar taxes imposed by the United States (or any
political subdivision or taxing authority thereof or therein) from interest,
fees or other amounts payable hereunder for the account of any Noteholder that
is a Non-U.S. Noteholder and that has not provided to the Company the forms
required to be provided to the Company pursuant to the preceding paragraph, and
the Company shall have no obligation to pay any additional amount to a Non-U.S.
Noteholder with respect to such withheld amounts or with respect to Taxes
incurred by such Non-U.S. Noteholder to the extent such withholding would not
have been required or such Taxes would not have been incurred if such Non-U.S.
Noteholder would have provided such forms to the Company in the manner required
by the preceding paragraph.

                                       24
<PAGE>   30
                                   ARTICLE V

                                WARRANTIES, ETC.

         To induce the Purchaser to enter into this Agreement and to purchase
the Subject Securities hereunder, the Company represents and warrants unto the
Purchaser as follows (and, for all purposes of this Agreement, all of such
representations and warranties shall be understood to be made by the Company on
(and only on) the date of execution and delivery of this Agreement by the
Company and the Closing Date (except to the extent specifically made as of
another date); provided, however, that (x) the representations in Sections 5.4
and 5.20 relative to any financial, other information or projections delivered
from time to time pursuant to this Agreement or any other Purchase Document
shall also be understood to be made with respect thereto on the date of delivery
thereof and (y) the representations in Sections 5.1, 5.2 and 5.3 relative to
each Subsidiary Guarantor shall also be understood to be made on the date when
such Subsidiary Guarantor executes and delivers a Subsidiary Guaranty pursuant
to clause (a) of Section 6.1.6.):

         SECTION 5.1 Organization, Power, Authority, etc. Each Obligor is a
corporation duly incorporated and in good standing under the laws of the
jurisdiction of its incorporation and has full power and authority and holds all
requisite Approvals to own and hold its property and to conduct its business
substantially as currently conducted by it. The Company has full power and
authority to enter into and perform its obligations under this Agreement, the
Series No. 1 Notes, the other Subject Securities and each other Purchase
Document to which it is a party and to issue the Subject Securities (and any
Common Shares issuable upon exercise of any thereof), and each Subsidiary
Guarantor has full power and authority to enter into and perform its obligations
under the Subsidiary Guaranty and each other Purchase Document to which it is a
party.

         SECTION 5.2 Due Authorization. The execution and delivery by the
Company of this Agreement, the Series No. 1 Notes and other Subject Securities
and each other Purchase Document to which it is a party, the performance by the
Company of its obligations hereunder and thereunder, and the issuance of the
Subject Securities (and the issuance of Common Shares issuable upon exercise of
any thereof) by the Company, and the execution and delivery by each Subsidiary
Guarantor of the Subsidiary Guaranty and each other Purchase Document to which
it is a party and the performance by each Subsidiary Guarantor of its
obligations thereunder, have been duly authorized by all necessary corporate
action, do not require any Approval, do not and will not conflict with, result
in any violation of, or constitute any default under, any provision of any
Organizational Document, any Applicable Law or Material Contract and will not
result in or require the creation or imposition of any Lien on any of its
properties pursuant to the provisions of any Material Contract (excluding,
however, pursuant to any Purchase Document).

         SECTION 5.3 Validity, etc. This Agreement constitutes, and the Series
No. 1 Notes and other Subject Securities and each other Purchase Document to
which the Company is a party will on the due execution and delivery thereof
constitute, the legal, valid and binding obligations of the Company enforceable
in accordance with their respective terms, subject, however, as to enforcement
only, to bankruptcy, insolvency, reorganization, moratorium or similar laws at
the time in effect affecting the enforceability of the rights of creditors
generally and general equity principles (regardless of whether enforcement is
sought in a proceeding at law or in equity). The Subsidiary Guaranty and each
other Purchase Document to which each Subsidiary Guarantor is a party will on
the due execution and delivery

                                       25
<PAGE>   31
thereof constitute the legal, valid and binding obligation of such Subsidiary
Guarantor enforceable in accordance with their respective terms, subject,
however, as to enforcement only, as aforesaid.

         SECTION 5.4 Financial Information. All balance sheets, financial
statements and all other financial information which have been furnished by or
on behalf of the Company to the Purchaser for the purposes of or in connection
with this Agreement or any transaction contemplated hereby, including

                  (a) the audited consolidated balance sheet at December
         31, 1998, and the related consolidated statement of operations, of
         shareholders' equity and of cash flow for the fiscal year then ended,
         of the Company and its Subsidiaries (the "1998 Audited Financial
         Statements"), and

                  (b) the consolidated balance sheet at September 30, 1999,
         and the related consolidated statements of operations, of shareholders'
         equity and of cash flow for the three fiscal quarters then ended, of
         the Company and its Subsidiaries (the "1999 Interim Financial
         Statements"),

have been prepared in accordance with GAAP consistently applied throughout the
periods involved (except as disclosed therein) and present fairly the
consolidated financial condition of the corporations covered thereby as at the
dates thereof and the results of their operations for the periods then ended.
All financial information as to the Company and Subsidiaries which shall
hereafter from time to time be furnished by or on behalf of the Company to the
Purchaser and other Noteholders for the purposes of or in connection with this
Agreement or any transaction contemplated hereby will be prepared in accordance
with GAAP consistently applied throughout the periods involved (except as
disclosed therein) and will present fairly the consolidated financial condition
of the corporations covered thereby as at the dates thereof and the results of
their operations for the periods then ended except (i) as may be otherwise
indicated in such financial statements or the notes thereto or (ii) in the case
of unaudited interim statements, to the extent they may not include footnotes or
summary statements or may be condensed (subject, however, in the case of
unaudited interim statements, to normal year-end audit adjustments).

         SECTION 5.5 Absence of Material Adverse Change. There have been
no occurrences, events or changed circumstances since December 31, 1998, other
than as disclosed in the Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1999 (excluding, however, the Transaction) which,
individually, as part of a series or in the aggregate, have had a Materially
Adverse Effect.

         SECTION 5.6 Continuing Indebtedness. There is no long-term
Indebtedness of the Company and Subsidiaries on a consolidated basis expected to
be outstanding immediately after giving effect to the Transaction, except as
disclosed in Item 5.6 ("Ongoing Indebtedness") of the Disclosure Schedule.

         SECTION 5.7 Contingencies. Neither the Company nor any Subsidiary has
any contingent liability for taxes, long-term leases or unusual forward or
long-term commitments or material unrealized or unanticipated losses from
unfavorable commitments which could reasonably be expected, individually or in
the aggregate, to have a Materially Adverse Effect and which are not reflected
in the financial statements described in clause (a) or (b) of Section 5.4 or in
the notes thereto.

         SECTION 5.8 Litigation, etc. There is no pending or, to the Company's
Knowledge, threatened litigation, arbitration or governmental investigation or
proceeding against, or labor controversy affecting

                                       26
<PAGE>   32
the Company or any Subsidiary or to which any of the properties, assets or
revenues of any thereof is subject (x) which could reasonably be expected,
individually or in the aggregate, to have a Materially Adverse Effect, except as
disclosed in Item 5.8 ("Litigation, etc.") of the Disclosure Schedule or (y)
which relates to the Transaction.

         SECTION 5.9 Capitalization.

                  (a) On the Closing Date, the authorized Capital Stock of
         the Company will be as set forth in Item 3.4 ("Capital Stock") of the
         Disclosure Schedule and the number of Common Shares reserved for
         issuance upon the exercise of

                           (i) any and all stock option plans or employee
                  ownership plans in respect of the Capital Stock of the Company
                  in existence on the Closing Date,

                           (ii) any warrants, other than the warrants issued in
                  connection with this Transaction; and

                           (iii) the conversion or exchange of all securities
                  convertible into or exchangeable for Common Shares,

         respectively, is as set forth therein.

                  (b) The Common Shares to be issued to the Purchaser
         pursuant to the Warrant will have been duly authorized for issuance
         and, when sold and delivered against payment therefor as provided
         herein and in the Warrant Agreement, will be validly issued, fully paid
         and non-assessable and will be free and clear of all preemptive rights
         and Liens except as otherwise provided herein and will be entitled to
         the respective voting powers, designations, preferences and relative,
         participating, optional or other special rights and qualifications,
         limitations or restrictions thereof as are set forth with respect
         thereto in the Certificate of Incorporation.

                  (c) The Company does not have outstanding any Capital Stock or
         securities convertible into or exchangeable for any shares of its
         Capital Stock, nor does it have outstanding any rights or options to
         subscribe for or to purchase any Capital Stock or securities
         convertible into or exchangeable for any of its shares of Capital
         Stock, except as described in this Section. Except as disclosed in Item
         5.9 ("Repurchase, etc. Agreements") of the Disclosure Schedule, the
         Company is not subject to any obligation (contingent or otherwise) to
         repurchase or otherwise acquire or retire any shares of its Capital
         Stock.

                  (d) The aggregate amount of Common Shares issuable
         pursuant to any warrants, options and other rights held by any
         management employee of the Company or any Affiliate thereof for which
         the exercise price thereof is equal to or greater than the market price
         of such Common Shares on the Closing Date does not exceed 5% of the
         aggregate outstanding Common Shares of the Company at the time of
         calculation.

                  (e) Except for the Registration Agreement, the Warrant
         Agreement, and the First Registration Agreement, and the registration
         of existing stock options and stock options granted

                                       27
<PAGE>   33
         under the 1999 Stock Option Plan, none of the Company or any Subsidiary
         has entered into an agreement to register any of its securities under
         the Securities Act.

         SECTION 5.10 Margin Regulations. The Company is not engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying margin stock, and less than 25%
of the assets of the Company, individually and on a consolidated basis with all
Subsidiaries, consists of margin stock. Terms for which meanings are provided in
F.R.S. Board Regulation U or any regulations substituted therefor, as from time
to time in effect, are used in this Section with such meanings.

         SECTION 5.11 Government Regulation. Neither the Company nor any
Subsidiary is (or shall upon the consummation of the Transaction become) (x) an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, or 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, or (y) subject to regulation under the Federal Power
Act, the Interstate Commerce Act, the Commodity Exchange Act or any Applicable
Law limiting its ability to incur or assume Indebtedness for borrowed money.

         SECTION 5.12 Title to and Condition of Properties; Material Contracts.
Each of the Company and each Subsidiary (x) has good and marketable title to all
of the real property, and valid title to all of the personal properties and
other assets (tangible, intangible or mixed), which it purports to own (except
where failure would not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect), free and clear of all Liens
(excluding, however, Liens permitted by Section 6.2.3) and (y) enjoys peaceful
and undisturbed possession under all leases to which it is a party as lessee
(excluding, however, leases the absence of which would not reasonably be
expected, individually or in the aggregate, to have a Materially Adverse
Effect). All Material Contracts to which the Company is a party are valid and
binding and in full force and effect, and no default has occurred or is
continuing thereunder except as disclosed on Item 5.12 ("Defaults") of the
Disclosure Schedule. No consent need be obtained from any Person (which is not
required by Article III to be obtained on or prior to the Closing Date) in
respect of any such Material Contract in connection with the Transaction which,
if not obtained, would reasonably be expected, individually or in the aggregate,
to have a Materially Adverse Effect.

         SECTION 5.13 Patents, Trademarks, etc. The Company and Subsidiaries
own, or are licensed under, and have the rights to use, all material patents,
trademarks, trade names, copyrights, technology, recipes, know-how and processes
(collectively, "Intellectual Property") necessary for the conduct of their
businesses as currently conducted, and the consummation of the Transaction does
not alter or impair any such rights. Except as disclosed in Item 5.13 ("Patents,
Trademarks, etc.") of the Disclosure Schedule, there is no (x) claim which has
been asserted by any Person to the use of any Intellectual Property or
challenging or questioning the validity or effectiveness of any license or
agreement related thereto or (y) to the Company's Knowledge, valid basis for any
such claim or any claim that the use of such Intellectual Property by the
Company and Subsidiaries infringes or will infringe on the rights of any Person.

         SECTION 5.14 Taxes. The Company and each of its Subsidiaries has
filed all material tax returns and reports required by Applicable Law to have
been filed by it and has paid all taxes and governmental charges thereby shown
to be owing, excluding, however, any such taxes or charges which

                                       28
<PAGE>   34
are being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside on its
books.

         SECTION 5.15 Pension and Welfare Plans. During the 12
consecutive-month period prior to the Closing Date, no steps have been taken to
terminate any Plan, and no contribution failure has occurred with respect to any
Plan sufficient to give rise to a Lien under section 302(f) of ERISA. No
condition exists or event or transaction has occurred with respect to any Plan
which might result in the incurrence by the Company or any member of the
Controlled Group of any material liability, fine or penalty. Except as disclosed
in Item 5.15 ("Employee Benefit Plans") of the Disclosure Schedule, neither the
Company nor any of its Subsidiaries nor any member of the Controlled Group has
any contingent liability with respect to any post-retirement benefit under a
Plan, other than liability for continuation coverage described in Part 6 of
Title I of ERISA.

         SECTION 5.16 Environmental Matters. Except as disclosed in Item 5.16
("Environmental Matters") of the Disclosure Schedule,

                  (a) to the Company's Knowledge all facilities and
         property (including underlying groundwater) owned or leased by the
         Company or any of its Subsidiaries are owned or leased by it in
         material compliance with all Environmental Laws,

                  (b) there have been no unresolved past, and there are no
         pending or, to the Company's Knowledge, threatened claims, complaints,
         notices or requests for information received by the Company or any of
         its Subsidiaries with respect to any alleged violation of any
         Environmental Law, or complaints, notices or inquiries to the Company
         or any of its Subsidiaries regarding potential liability under any
         Environmental Law (collectively, "Environmental Claims"),

                  (c) to the Company's Knowledge there have been no
         releases of Hazardous Materials at, on or under any property now or
         previously owned or leased by the Company or any of its Subsidiaries,

                  (d) to the Company's Knowledge no property now or
         previously owned or leased by the Company or any of its Subsidiaries is
         listed or proposed for listing (with respect to owned property only) on
         the National Priorities List pursuant to CERCLA, on the CERCLIS or on
         any similar state list of sites requiring investigation or clean-up,

                  (e) none of the Company or any of its Subsidiaries has
         received notice that the Company or any of its Subsidiaries is
         potentially responsible for clean-up or other corrective action under
         any Environmental Law,

                  (f) to the Company's Knowledge there are no underground
         storage tanks, active or abandoned, including petroleum storage tanks,
         on or under any property now or previously owned or leased by the
         Company or any of its Subsidiaries,

                  (g) neither the Company nor any of its Subsidiaries has
         directly transported or directly arranged for the transportation of any
         Hazardous Material to any location which is listed or, to the Company's
         Knowledge, proposed for listing on the National Priorities List
         pursuant to

                                       29
<PAGE>   35
         CERCLA, on the CERCLIS or on any similar federal, state or provincial
         list or which is the subject of federal, state, provincial or local
         enforcement actions or other investigations which may lead to material
         claims against the Company or any Subsidiary for any remedial work,
         damage to natural resources or personal injury, including claims under
         CERCLA,

                  (h) to the Company's Knowledge, there are no polychlorinated
         biphenyls or friable asbestos present at any property now or previously
         owned or leased by the Company or any of its Subsidiaries, and

                  (i) to the Company's Knowledge, no conditions exist at, on or
         under any property now or previously owned or leased by the Company or
         any of its Subsidiaries which, with the passage of time, or the giving
         of notice or both, would give rise to liability under any Environmental
         Law,

except, in any and all such cases, as would not reasonably be expected,
individually or in the aggregate, to have a Materially Adverse Effect.

         SECTION 5.17 Year 2000 Problem. The Company has reviewed its
operations and those of its Subsidiaries with a view to assessing whether it or
its Subsidiaries' respective businesses will, in the receipt, transmission,
processing, manipulation, storage, retrieval, retransmission or other
utilization of data, be vulnerable to a Year 2000 Problem. Based on such review,
the Company has no reason to believe that a Materially Adverse Effect will
result from a Year 2000 Problem.

         SECTION 5.18 Solvency. The Transaction (including the issuance and
sale of the Series No. 1 Notes hereunder, the incurrence by the Company of the
Indebtedness represented by the Series No. 1 Notes and the application of the
proceeds of the issuance and sale of the Series No. 1 Notes), will not involve
or result in any fraudulent transfer or fraudulent conveyance under the
provisions of any applicable federal or state law respecting fraudulent
transfers or fraudulent conveyances. After giving effect to the Transaction, the
Company and each Subsidiary will be solvent.

         SECTION 5.19 Subsidiaries, etc. As of the Closing Date,

                  (a) the Company will have no Subsidiaries and no other
         Investments in any joint venture, partnership or other Person, except
         as disclosed in Item 5.19 ("Subsidiaries, etc.") of the Disclosure
         Schedule; and

                  (b) the Company will be the record and beneficial owner, free
         of Liens, of 100% of the issued and outstanding Capital Stock of each
         Subsidiary.

         SECTION 5.20 Accuracy of Information. All factual information (and, for
the sake of clarity, not including any projections) heretofore or
contemporaneously furnished by or on behalf of the Company in writing to the
Purchaser for purposes of or in connection with the Transaction, including true
and complete copies thereof furnished to the Purchaser prior to the execution
and delivery of this Agreement, is collectively, and all other such factual
written information hereafter furnished by or on behalf of the Company to the
Purchaser or any Noteholder will be, in light of the circumstances under which
it was made, individually, true and accurate in every material respect taken as
a whole on the date as of which such written information is dated or certified,
and such information is not, or shall not be, as the case may be,

                                       30
<PAGE>   36
incomplete on the date as of such information is dated or certified by omitting
to state any material fact necessary to make such information, in light of the
circumstances under which it was made, not misleading. There is, to the
Company's Knowledge, no fact that the Company has not disclosed to the Purchaser
in writing that would, individually or in the aggregate, reasonably be expected
to have a Materially Adverse Effect. All projections heretofore,
contemporaneously and hereafter furnished by or on behalf of the Company in
writing to the Purchaser for purposes of this Agreement or any transaction
contemplated hereby are and will be based on good faith estimates and
assumptions which the Company believes are fair and reasonable in light of the
historical financial performance of the Company and current and reasonably
foreseeable business conditions, and, to the Company's Knowledge, there are or
will be no facts or circumstances existing at the time such projections are
furnished which would, individually or in the aggregate, reasonably be expected
to cause a material change in such projections, it being recognized, however, by
the Purchaser that projections as to future events are not to be viewed as fact
and that actual results during the period or periods covered by any such
projections may differ from the projected results and that the differences may
be material.

         SECTION 5.21 Offering of Subject Securities. Neither the Company, any
Subsidiary nor any Person employed to act on behalf of any thereof in connection
with the offer and sale of the Subject Securities has directly or indirectly
offered the Series No. 1 Notes, the Common Shares or any part thereof or any
similar securities for sale to, or solicited any offer to buy any of the same
from, or otherwise approached or negotiated in respect thereof with, anyone
other than the Persons identified in Item 3.4 ("Capital Stock") of the
Disclosure Schedule. Neither the Company, nor anyone acting on behalf of it has
taken or will take any action which would subject the issuance or sale of the
Series No. 1 Notes or Common Shares to the provisions of Section 5 of the
Securities Act or to the registration or qualification requirements of any
securities or blue sky law of any applicable jurisdiction.

                                   ARTICLE VI

                                   COVENANTS

         SECTION 6.1 Certain Affirmative Covenants. The Company agrees with:

                  (a) the Purchaser and each other Noteholder that, until all
         Obligations have been paid and performed in full, the Company will
         perform all of the covenants contained in Section 6.1;

                  (b) the Purchaser and each other Institutional Holder that,
         for so long as either shall hold any Subject Security (other than a
         Series No. 1 Note), the Company will perform the covenants contained in
         clause (b) of Section 6.1.1 for the benefit of the Purchaser or such
         Institutional Holder as if it were a Noteholder; and

                  (c) the Purchaser that, if at any time and for so long as (i)
         the Purchaser shall hold any Subject Security (other than a Series No.
         1 Note) and (ii) the Company is not subject to the reporting
         requirements of Section 13 (d) or (g) of the Exchange Act, the Company
         will perform the covenants contained in clauses (a) and (b) of Section
         6.1.1 for the benefit of the Purchaser as if it were a Noteholder.

                                       31
<PAGE>   37
         SECTION 6.1.1 Financial Information, etc. The Company will furnish, or
will cause to be furnished, to the Purchaser and each other Noteholder copies of
the following financial statements, reports and information:

                  (a) promptly when available and in any event within 120 days
         after the close of each Fiscal Year, (i) a consolidated balance sheet
         as of the end of such Fiscal Year, and consolidated statements of
         operations, of shareholders' equity and of cash flow for such Fiscal
         Year, of the Company and Subsidiaries, prepared on a comparative basis
         with the preceding Fiscal Year and audited by Ernst & Young, L.L.P. (or
         other independent public accountants of recognized national standing
         selected by the Company) and (ii) credit collection analyses on a
         "static pool" basis together with all servicer reports for the last
         Fiscal Quarter of such Fiscal Year prepared in connection with any
         Securitization Transaction or warehouse financing;

                  (b) promptly when available and in any event within 60 days
         after the close of each of the first three Fiscal Quarters of each
         Fiscal Year, and certified by the chief accounting, executive or
         financial officer of the Company, (i) consolidated balance sheets at
         the close of such Fiscal Quarter, and the related consolidated
         statements of operations, of shareholders' equity and of cash flow for
         such Fiscal Quarter and for the period commencing at the close of the
         previous Fiscal Year and ending with the close of such Fiscal Quarter,
         of the Company and Subsidiaries (with comparative information at the
         close of and for the corresponding Fiscal Quarter of the prior Fiscal
         Year and for the corresponding portion of such prior Fiscal Year), (ii)
         management discussion and analysis of such balance sheets and financial
         statements and (iii) credit collection analyses on a "static pool"
         basis together with all servicer reports for such Fiscal Quarter
         prepared in connection with any Securitization Transaction or warehouse
         financing;

                  (c) promptly when available and in any event within 30 days
         after the close of each calendar month, and certified by the chief
         accounting, executive or financial officer of the Company, (i)
         consolidated balance sheets at the close of such calendar month, and
         the related consolidated statements of operations, of shareholders'
         equity and of cash flow for such calendar month and for the period
         commencing at the close of the previous Fiscal Year and ending with the
         close of such calendar month, of the Company and Subsidiaries (with
         comparative information at the close of and for the corresponding
         calendar month of the prior Fiscal Year and for the corresponding
         portion of such prior Fiscal Year) and (ii) a copy of all Form 8-Ks
         filed by the Company during such month, provided, that if at any time
         and for so long as the Company is not subject to the reporting
         requirements of Section 13 (d) or (g) of the Exchange Act, then the
         Company, in lieu of furnishing such Form 8-Ks, will furnish such
         information that would otherwise be required to be reported in such
         Form 8-Ks;

                  (d) together with each set of financial statements delivered
         from time to time as at the close of any Fiscal Year or Fiscal Quarter,
         a certificate of the chief accounting, executive or financial officer
         of the Company stating that to the best of such Officer's Knowledge no
         Default had occurred or was continuing at the close of such Fiscal Year
         or Fiscal Quarter, as the case may be, or, if a Default had occurred
         and was continuing, a description thereof and a statement as to whether
         it is continuing and as to what actions are being taken to cure it;

                                       32
<PAGE>   38
                  (e) with ten (10) Business Days after approval thereof by the
         Company's Board of Directors, the Company's budget as in effect for
         such Fiscal Year substantially in the form approved by the Company's
         Board of Directors;

                  (f) promptly after being made generally available to the
         public by the Company, all press releases and statements delivered to
         its shareholders concerning developments that are material; and

                  (g) such other information with respect to the financial
         condition, business, property, assets, revenues and operations of the
         Company or any Subsidiary as the Purchaser or the Required Noteholders
         may from time to time reasonably request (including as to potentially
         material environmental conditions to monitor compliance with Section
         6.1.8).

For purposes of any financial statements delivered pursuant to clauses (a) and
(b), all Subsidiaries which are either direct Subsidiaries or Subsidiaries of
the same Subsidiary and which are not Subsidiary Guarantors may be treated
collectively on a consolidated basis.

         The Purchaser and each other Noteholder and Institutional Holder
acknowledge that certain information provided to such parties pursuant to this
Agreement may consist of material nonpublic information regarding the Company,
and each such party acknowledges and agrees that it is aware (and that any
Person to whom any such information may be disclosed as permitted by this
Agreement has been, or upon receiving such information will be, advised) of the
restrictions imposed by federal and state securities laws on a Person possessing
material nonpublic information regarding an issuer of securities.
Notwithstanding any other provision in this Agreement, this paragraph shall
survive and continue to be binding against Purchaser, each other Noteholder and
Institutional Holder after any sale, conveyance, assignment or transfer by any
such Person of any Subject Security or the Warrants.

         SECTION 6.1.2 Notice of Default, etc. The Company will furnish, or
will cause to be furnished, to the Purchaser and each other Noteholder prompt
notice (with a description in reasonable detail) of:

                  (a) the occurrence, to the Company's Knowledge, of any
         Default;

                  (b) any steps by the Company or any other Person to terminate
         any Plan, or the failure to make a required contribution to any Plan if
         such failure is sufficient to give rise to a Lien under section 302(f)
         of ERISA, or of any action with respect to a Plan which could result in
         the requirement that the Company or any Subsidiary furnish a bond or
         other security with the PBGC or such Plan, or any event with respect to
         any Plan which could result in the incurrence by the Company or any
         Subsidiary of any material liability, fine or penalty, or any material
         increase in the Contingent Liability of the Company or any Subsidiary
         with respect to any post-retirement Plan benefit, notice thereof and
         copies of all documentation relating thereto; and

                  (c) material written claims, complaints, notices or inquiries
         relating to compliance with Environmental Laws with respect to the
         condition of any facilities and properties of the Company or any
         Subsidiary.

                                       33
<PAGE>   39
         SECTION 6.1.3 Maintenance of Corporate Existence, etc. Except as
allowed under Section 6.2.7, the Company will cause to be done at all times all
things necessary to maintain and preserve the corporate existence of the Company
and each Material Subsidiary.

         SECTION 6.1.4 Performance of Purchase Documents. The Company will, and
will cause each Subsidiary to, perform promptly and faithfully all of its
obligations under each Purchase Document.

         SECTION 6.1.5 Books and Records. The Company will, and will cause each
Subsidiary to, keep books and records reflecting all of its business affairs and
transactions in accordance with GAAP and permit the Noteholders as a single
group or any representatives of all Noteholders (as appointed by the Required
Noteholders), at reasonable times and intervals and on reasonable prior notice,
to visit all of its offices, to discuss its financial matters with its officers
and independent public accountant (and hereby authorizes such independent public
accountant to discuss its financial matters with the Noteholders as a single
group or their aforementioned representatives whether or not any representative
of the Company is present) and to examine (and, at the reasonable expense of the
Company, photocopy extracts (such extracts to be identified by the Required
Noteholders or their authorized representatives with reasonable particularity)
from) any of its books or other corporate records. For so long as an Event of
Default exists and is continuing, the Company agrees to pay any reasonable fees
and out-of-pocket expenses of a single independent public accounting firm
representing all Noteholders (as appointed by the Required Noteholders)
reasonably incurred in connection with the Noteholders' exercise of their rights
pursuant to this Section.

         SECTION 6.1.6 Subsidiary Guarantors. The Company will:

                  (a) concurrently with any Person (other than any
         Securitization Subsidiary) becoming a Material Subsidiary, cause such
         Material Subsidiary (x) to execute and deliver to the Purchaser a
         guaranty agreement (as amended, supplemented and otherwise modified
         from time to time, the "Subsidiary Guaranty") in substantially the form
         of Exhibit D hereto and (y) to deliver to the Purchaser appropriately
         completed certificates substantially in the form of Exhibits B and C
         hereto; and

                  (b) except as allowed under Section 6.2.7, continue to own and
         hold, free of Liens (other than Liens created by the Purchase
         Documents), all of the outstanding shares of Capital Stock of each
         Subsidiary.

         SECTION 6.1.7 Payment of Taxes, etc. The Company will, and will cause
each Subsidiary to, pay and discharge, as the same may become due and payable,
all federal, state and local taxes, assessments, fees and other governmental
charges or levies against it or on any of its property, as well as claims of any
kind which, if unpaid, might become a material Lien upon any of its properties;
provided, however, that the foregoing shall not require the Company or any
Subsidiary to pay or discharge any such tax, assessment, fee, charge, levy or
Lien so long as it shall be diligently and promptly contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves in accordance with GAAP with respect thereto.

         SECTION 6.1.8 Environmental Conduct. The Company will, and will cause
each Subsidiary to, (x) use and operate all of its facilities and properties in
compliance with all Environmental Laws, (y) keep all necessary permits,
approvals, certificates, licenses and other authorizations relating to

                                       34
<PAGE>   40
environmental matters in effect and remain in compliance therewith and (z)
handle all Hazardous Substances in compliance with all applicable Environmental
Laws; except, in each case, where the failure to comply with the terms of this
Section 6.1.8 could not reasonably be expected, individually or in the
aggregate, to have a Materially Adverse Effect.

         SECTION 6.1.9 Use of Proceeds. The Company will lend the proceeds of
the Series No. 1 Notes to Midland. Midland will use such proceeds (a) to
purchase charged-off accounts and (b) for working capital and general corporate
purposes.

         SECTION 6.1.10 Insurance. The Company will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained with responsible insurance
companies insurance with respect to its properties and business against such
casualties and contingencies and of such types and in such amounts as is
reasonable and customary in the case of similar businesses.

         SECTION 6.1.11 Subsequent Note Issuance. The Company will, promptly
upon the issuance of any Indebtedness allowed under Section 6.2.2(b), amend this
Agreement (and each other Purchase Document to the extent required) to the
extent necessary to ensure that no holder of any such Indebtedness enjoys any
other terms and conditions in the aggregate that are more favorable than those
of any Noteholder hereunder (including interest rates and covenants).

         SECTION 6.2 Certain Negative Covenants. The Company agrees with

                  (a) the Purchaser and each other Noteholder that, until all
         Obligations have been paid and performed in full, the Company will
         perform all of the covenants contained in this Section 6.2; and

                  (b) the Purchaser and each other Institutional Holder that,
         for so long as either shall hold any Subject Security (other than a
         Series No. 1 Note), the Company will perform the covenants contained in
         Section 6.2.1, 6.2.7, and 6.2.11 for their benefit as if they were
         Noteholders.

         SECTION 6.2.1 Business Activities. The Company will not, and will not
permit any Subsidiary to, engage in any business activity, excluding, however,
its consummation of the Transaction, its performance from time to time of its
obligations under the Transaction Documents and its engaging in activities in
which the Company or its Subsidiaries are engaged on the Closing Date (which the
Purchaser acknowledges is the purchase, sale and servicing of charged-off
accounts, including, without limitation, Securitization Transactions and
Residual Transactions in connection therewith), and, in each case, activities or
lines of business incidental and related thereto and (ii) Investments permitted
pursuant to clause (f) of Section 6.2.6.

         SECTION 6.2.2 Indebtedness. The Company will not, and will not permit
any Subsidiary to, create, incur, assume or suffer to exist or otherwise become
or be liable in respect of any Indebtedness other than:

                  (a) Indebtedness in respect of the Series No. 1 Notes and
         other Obligations;

                                       35
<PAGE>   41
                  (b) future Indebtedness of the Company in an aggregate
         principal amount not to exceed $40,000,000 which Indebtedness is
         incurred on terms and conditions substantially similar to those of this
         Agreement; provided, that all proceeds of any such Indebtedness in
         excess of $25,000,000 shall be used to permanently reduce the Bank of
         America Indebtedness to the extent outstanding and, to the extent not
         outstanding, to permanently reduce the availability of borrowings under
         the Bank of America Credit Agreement;

                  (c) the Bank of America Indebtedness;

                  (d) other future non-recourse Indebtedness of the Company
         or any Securitization Subsidiary, the proceeds of which are used for
         the purpose of acquiring, financing or refinancing charged-off
         accounts, and that is incurred by the Company or such Securitization
         Subsidiary on terms and conditions customary to such Securitization
         Transactions; provided, however, that the aggregate original principal
         amount of such Indebtedness shall not, when incurred, exceed (i) in the
         case of charged-off accounts that have not been subject to a prior
         Securitization Transaction, 100% of the acquisition cost of the
         accounts being financed or sold in connection with such Indebtedness
         less 50% of the actual collections against such accounts, and (ii) in
         the case of charged-off accounts that have been subject to a prior
         Securitization Transaction, the aggregate outstanding principal balance
         of the Indebtedness in such Securitization Transaction at the time such
         charged-off accounts are released therefrom;

                  (e) other future Indebtedness of the Company or any Subsidiary
         that is incurred by the Company or such Subsidiary (i) by releveraging
         charged-off accounts owned by any Securitization Subsidiary or (ii) on
         the basis of the Company's or such Subsidiary's equity interest in any
         Securitization Subsidiary or residual or subordinate interest in any
         Securitization Transaction (each a "Residual Transaction"); provided,
         however, that no such Indebtedness shall be incurred unless the net
         cash proceeds (taking into account payment of applicable Taxes) of such
         Indebtedness are applied in accordance with Section 4.3;

                  (f) other future Indebtedness of the Company or any Subsidiary
         that consists of warehouse financing of charged-off accounts; provided,
         however, that the aggregate original principal amount of such
         Indebtedness shall not, when incurred, exceed 100% of the acquisition
         cost of the accounts being financed in connection with such
         Indebtedness;

                  (g) Capitalized Lease Liabilities (i) incurred to finance the
         acquisition of new assets, not to exceed $6,000,000 at any one time,
         and (ii) incurred for any other purpose, not to exceed $300,000 at any
         one time; and

                  (h) without duplication, Indebtedness disclosed on Item 5.6
         ("Ongoing Indebtedness") of the Disclosure Schedule;

provided, however, that, no Indebtedness otherwise permitted pursuant to any of
the foregoing clauses (excluding, however, clauses (a) and (b)) shall be
permitted if such Indebtedness is owing by the Company to a Subsidiary unless
such Indebtedness is expressly subordinated to the prior payment in full in cash
of all Obligations and is incurred on such terms and conditions consented to by
the Required Noteholders in their discretion.

                                       36
<PAGE>   42
         SECTION 6.2.3 Liens. The Company will not, and will not permit any
Subsidiary to, create, incur, assume or suffer to exist any Lien upon any of its
property, revenues or assets, whether now owned or hereafter acquired, except:

                  (a) Liens securing the Obligations;

                  (b) Liens granted by the Company prior to the Closing Date to
         secure the Bank of America Indebtedness as in effect on the Closing
         Date;

                  (c) Liens granted by the Company to secure its obligations
         under the Reimbursement Agreement;

                  (d) Liens granted by a Securitization Subsidiary to secure
         Indebtedness allowed under clause (d) of Section 6.2.2; provided,
         however, that no such Lien shall be granted except to create a security
         interest in the specific charged-off accounts financed or purchased by
         the beneficiary of such Lien;

                  (e) Liens granted by the Company or a Subsidiary to secure
         Indebtedness allowed under clause (e) of Section 6.2.2; provided,
         however, that no such Lien shall be granted except to create a security
         interest in the equity interest in any Securitization Subsidiary or
         residual interest in any Securitization Transaction;

                  (f) Liens granted by the Company or a Subsidiary to secure
         Indebtedness allowed under clause (f) of Section 6.2.2; provided,
         however, that no such Lien shall be granted except to create a security
         interest in the specific charged-off accounts financed, refinanced or
         purchased in connection with such warehouse financing; and

                  (g) Permitted Liens.

         SECTION 6.2.4 Bank of America Credit Agreement. The Company will not,
and will not permit any Subsidiary to, materially amend, modify or consent to
any such material amendment or modification of, the Bank of America Credit
Agreement, without the prior written consent of the Required Noteholders which
shall not be unreasonably withheld, it being understood and agreed that, without
the consent of the Required Noteholders, the Bank of America Credit Agreement
may be extended or amended and restated without material departure from the
terms and conditions contained therein as of the Closing Date other than market
related changes in the interest rate.

         SECTION 6.2.5 Restricted Payments, etc. On or after the Closing Date,
the Company will not, and will not permit any Subsidiary to, declare, pay, make,
apply any of its funds, property or assets to making or making any deposit to
fund any Restricted Payment.

                                       37
<PAGE>   43
         SECTION 6.2.6 Investments. The Company will not, and will not permit
any Subsidiary, other than a Securitization Subsidiary in a Securitization
Transaction, to, make any Investments, except:

                  (a) Investments of the Company in any Subsidiary Guarantor
         that is a wholly-owned Subsidiary;

                  (b) Cash Equivalent Investments, excluding, however,
         Investments described in clause (f) of the definition of Cash
         Equivalent Investments.

                  (c) Investments made by way of the Company or any
         wholly-owned Subsidiary of the Company acquiring not less than 51% of
         the outstanding Capital Stock of any Person, if after giving effect
         thereto, (x) no Default has occurred and is continuing and (y) such
         Person becomes a Subsidiary Guarantor in accordance with Section 6.1.6;

                  (d) capital contributions to a Securitization Subsidiary
         in connection with (i) the initial closing of any Securitization
         Transaction, or (ii) any equity or reserve account funding required in
         connection with the purchase of new charged-off accounts under any
         warehouse financing;

                  (e) Investments made in connection with any Securitization
         Transaction in an amount not greater than 15% of the original principal
         balance of the Indebtedness incurred under such Securitization
         Transaction; and

                  (f) additional Investments not to exceed an amount equal to
         the product of (x) $500,000 multiplied by (y) a fraction, the numerator
         of which equals $10,000,000 plus any Indebtedness incurred pursuant to
         clause (b) of Section 6.2.2, and the denominator of which equals
         $10,000,000.

                  SECTION 6.2.7 Consolidation, Merger, etc. The Company will
         not, and will not permit any Subsidiary to,

                  (a) liquidate or dissolve, consolidate with, or merge into or
         with, any other corporation or purchase or otherwise acquire all or
         substantially all of the assets of any Person (or of any division
         thereof); or

                  (b) sell, transfer, convey or otherwise dispose of all or any
         substantial part of its assets, other than the sale of charged-off
         accounts sold or otherwise disposed of by a Securitization Subsidiary
         in connection with a Securitization Transaction;

provided, however, that

                  (c) any Subsidiary may liquidate or dissolve voluntarily into,
         and may merge with and into, the Company or any other Subsidiary;

                  (d) so long as no Payment or Insolvency Default or Event of
         Default has occurred and is continuing or would occur after giving
         effect thereto, the Company or any Subsidiary may

                                       38
<PAGE>   44
         purchase or acquire all of the outstanding shares of Capital Stock of,
         or substantially all of the assets of, any Person (or any division
         thereof) and such purchase or acquisition complies with clause (c) of
         Section 6.2.6; and

         (e) any Subsidiary may merge with any other corporation permitted to be
         acquired pursuant to clause (d) and may be created and capitalized for
         such purposes.

         SECTION 6.2.8 Rental Obligations. The Company will not, and will not
permit any Subsidiary to, enter into at any time after the Closing Date any
lease, except any lease (an "Operating Lease") which is not treated as a capital
lease in accordance with GAAP which, together with all other Operating Leases
then in effect, will not require the payment of an aggregate amount of rentals
by the Company and Subsidiaries in excess of $3,000,000 for any Fiscal Year.

         SECTION 6.2.9 Take or Pay Contracts. Except in the ordinary course of
business and consistent with past practices, the Company will not, and will not
permit any Subsidiary to, enter into or be a party to any arrangement for the
purchase of materials, supplies, other property or services if such arrangement
by its express terms requires that payment be made by the Company or such
Subsidiary regardless of whether such materials, supplies, other property or
services are delivered or furnished to it.

         SECTION 6.2.10 Negative Pledges, Upstream Restrictions, etc. The
Company will not, and will not permit any Subsidiary to, enter into any
agreement (excluding, however, this Agreement, the other Purchase Documents and
any agreement under which Indebtedness allowed under clause (b) of Section 6.2.2
is incurred) which expressly prohibits or restricts

                  (a) the creation or assumption of any Lien upon its
         properties, revenues or assets, whether now owned or hereafter acquired
         (excluding, however, (w) any agreement governing any Indebtedness
         permitted by clauses (d), (e) or (f) of Section 6.2.2 as to the assets
         financed with the proceeds of such Indebtedness, (x) customary
         non-assignment provisions in operating leases entered into in the
         ordinary course as to the leasehold interest created thereby, (y)
         customary non-assignment provisions in contracts, to the extent such
         provisions prohibit Liens on the rights under such contracts and (z)
         Liens granted by Securitization Subsidiaries in connection with a
         Securitization Transaction);

                  (b) the ability of the Company or any Subsidiary to amend or
         otherwise modify, or to perform obligations under, this Agreement or
         any other Purchase Document; or

                  (c) except as a part of a Residual Transaction, the ability of
         any Subsidiary to make any payments, directly or indirectly, to the
         Company by way of dividends, advances, repayments of loans or advances,
         reimbursements of management and other intercompany charges, expenses
         and accruals or other returns on Investments, or any other agreement or
         arrangement which restricts the ability of any such Subsidiary to make
         any payment, directly or indirectly, to the Company.

         SECTION 6.2.11 Transactions with Affiliates. The Company will not, and
will not permit any Subsidiary to, enter into, or cause, suffer or permit to
exist:

                  (a) any arrangement or contract with any of its other
         Affiliates of a nature customarily entered into by Persons which are
         Affiliates of each other (including management or
<PAGE>   45
         similar contracts or arrangements relating to the allocation of
         revenues, taxes and expenses or otherwise) requiring any payments to be
         made by the Company or any Subsidiary to any Affiliate unless such
         arrangement is fair and equitable to the Company or such Subsidiary; or

                  (b) any other transaction, arrangement or contract with any of
         its other Affiliates which would not be entered into by a prudent
         Person in the position of the Company or such Subsidiary with, or which
         is on terms which are less favorable than are obtainable from, any
         Person which is not one of its Affiliates;

provided, however, that this Section shall not be construed to restrict or
prohibit (i) execution and delivery of the Registration Agreement (ii) customary
provisions in Securitization Transactions and Residual Transactions (iii)
extensions, refinancings or renewals of the Bank of America Indebtedness, and
(iv) the purchase of any interest in the Series No. 1 Notes by any Affiliate of
the Company.

         SECTION 6.2.12 Asset Dispositions, etc. The Company will not, and will
not permit any Subsidiary to, sell (including as part of a sale-leaseback
transaction), transfer, lease, contribute or otherwise convey, or grant options,
warrants or other rights with respect to, all or any substantial part of its
assets (including accounts receivable and capital stock of Subsidiaries) to any
Person, unless:

                  (a) such sale, transfer, lease, contribution or conveyance is
         in the ordinary course of its business (including the disposition of
         obsolete equipment and the sale of receivables); or

                  (b) the net book value of all assets sold, transferred,
         leased, contributed or conveyed other than in the ordinary course of
         business by the Company and the Subsidiaries during the same Fiscal
         Year either (i) does not exceed $500,000 or (ii) the net proceeds above
         such amount from such sale, transfer, lease, contribution or conveyance
         are applied in accordance with Section 4.3; or

                  (c) such sale, transfer, lease, contribution or conveyance
         consists of a sale or transfer of charged-off accounts by any
         Subsidiary as in connection with any Securitization Transaction or the
         incurrence of Indebtedness allowed under clause (d) of Section 6.2.2.

                                   ARTICLE VII

                               EVENTS OF DEFAULT

         SECTION 7.1 Events of Default. The term "Event of Default" means any
of the following events:

         SECTION 7.1.1 Non-Payment of Obligations. The Company shall default in
the payment or prepayment when due of any principal of any Series No. 1 Note,
or, within three (3) Business Days of the due date thereof, the Company shall
default in the payment of interest on any Series No. 1 Note or any other
Obligation.

         SECTION 7.1.2 Default on Other Indebtedness. Any default shall occur
under the terms applicable to any recourse Indebtedness (excluding, however, any
Obligation) outstanding in a principal amount exceeding $500,000 of the Company
or any Subsidiary, in each case representing any borrowing
<PAGE>   46
or financing or arising under any other Material Contract, and such default (x)
shall consist of the failure to make any payment of principal or interest on, or
any redemption (or to make any required offer to redeem) of, such Indebtedness
when due (subject, however, to any applicable notice or grace period or if no
notice or grace period is provided, then the continuance of such failure for
five (5) Business Days after written notice of such failure is given by the
holder of such Indebtedness) in accordance with the terms thereof, or (y) shall
allow some or all of the holders of such Indebtedness to cause any or all of
such Indebtedness to become, or shall have resulted in any or all of such
Indebtedness having become, due and payable in accordance with its terms prior
to its stated maturity, whether by declaration or otherwise.

         SECTION 7.1.3 Bankruptcy, Insolvency, etc. The Company or any
Subsidiary shall:

                  (a) become insolvent or generally fail to pay, or admit in
         writing its inability to pay, debts as they become due;

                  (b) apply for, consent to or acquiesce in, the appointment of
         a trustee, receiver, sequestrator or other custodian for the Company or
         any Subsidiary or any property of any thereof or make a general
         assignment for the benefit of creditors;

                  (c) in the absence of such application, consent or
         acquiescence, permit or suffer to exist the appointment of a trustee,
         receiver, sequestrator or other custodian for the Company or any
         Subsidiary or for a substantial part of the property of any thereof,
         and such trustee, receiver, sequestrator or other custodian shall not
         be discharged within 60 days;

                  (d) permit or suffer to exist the commencement of any
         bankruptcy, reorganization, debt arrangement or other case or
         proceeding under any bankruptcy or insolvency law, or any dissolution,
         winding up or liquidation proceeding, in respect of the Company or any
         Subsidiary, and, if such case or proceeding is not commenced by the
         Company or such Subsidiary, such case or proceeding shall be consented
         to or acquiesced in by the Company or such Subsidiary or shall result
         in the entry of an order for relief or shall remain for 60 days
         undismissed; or

                  (e) take any corporate action authorizing, or in furtherance
         of, any of the foregoing.

         SECTION 7.1.4 Breach of Warranty. Any warranty of the Company
hereunder or in any other Purchase Document or any other writing furnished by or
on behalf of the Company to the Purchaser or any other Noteholder for the
purposes of or in connection with this Agreement or any such Purchase Document
is or shall be incorrect when made in any material respect.

         SECTION 7.1.5 Non-Performance of Certain Undertakings. The Company
shall default in the due performance and observation of any agreement contained
in Section 6.2.4, 6.2.5, 6.2.7, 6.2.9, 6.2.10, 6.2.11 or 6.2.12.

         SECTION 7.1.6 Non-Performance of Other Undertakings.

                  (a) Any Obligor shall default in the due performance and
         observance of any other agreement contained herein or in any other
         Purchase Document, and such default shall continue unremedied for a
         period of 30 days after notice thereof shall have been given to the
         Company by the Purchaser or the Required Noteholders.
<PAGE>   47
                  (b) The Company shall be removed as servicer in connection
         with any securitization financing during the continuance of any event
         of default thereunder.

         SECTION 7.1.7 Judgments. A final judgment, to the extent not fully
covered by insurance, shall be rendered against the Company or any Subsidiary
and such judgment shall remain in force, undischarged, unsatisfied and unstayed
for more than 60 days, whether or not consecutive, and such judgment, together
with all other such outstanding final judgments against the Company and
Subsidiaries, exceeds (to the extent of all such uninsured portions) an
aggregate of $500,000.

         SECTION 7.1.8 Pension Plans. Any of the following events shall occur
with respect to any Plan:

                  (a) the institution of any steps by the Company, any member of
         its Controlled Group or any other Person to terminate a Plan if, as a
         result of such termination, the Company or any such member could be
         required to make a contribution to such Plan, or could reasonably
         expect to incur a liability or obligation to such Plan, in excess of
         $500,000; or

                  (b) a contribution failure occurs with respect to any Pension
         Plan sufficient to give rise to a Lien under Section 302(f) of ERISA.

         SECTION 7.1.9 Clean Audit. The auditor's report that accompanies the
audited financial statements provided pursuant to clause (a) of Section 6.1.1
for any Fiscal Year other than Fiscal Year 2005 contains a "going concern"
qualification, unless such qualification is caused solely by reason of the
maturity of the Bank of America Indebtedness or the maturity of the Series No. 1
Notes, or (ii) reports an inability to opine on such financial statements.

         SECTION 7.2 Action if Bankruptcy. If any Event of Default described
in clauses (a) through (d) of Section 7.1.3 shall occur, the outstanding
principal amount of all outstanding Series No. 1 Notes and all other Obligations
shall automatically be and become immediately due and payable, without notice or
demand.

         SECTION 7.3 Action if Other Event of Default. If any Event of Default
(excluding, however, any Event of Default described in clauses (a) through (d)
of Section 7.1.3) shall occur for any reason, whether voluntary or involuntary,
and be continuing, the Required Noteholders may, upon notice or demand, declare
all or any portion of the outstanding principal amount of the Series No. 1 Notes
to be due and payable and any or all other Obligations to be due and payable,
whereupon the full unpaid amount of such Series No. 1 Notes and any and all
other Obligations which shall be so declared due and payable shall be and become
immediately due and payable, without further notice, demand or presentment.

         SECTION 7.4 Suits for Enforcement. If any Event of Default shall have
occurred and be continuing, the Required Noteholders may proceed to protect and
enforce the rights of the holders of such Series No. 1 Notes, either by suit in
equity or by action at law, or both, whether for the specific performance of any
covenant or agreement contained in this Agreement or in aid of the exercise of
any power granted in this Agreement, and may proceed to enforce the payment of
all sums due upon such Series No. 1 Notes, and such further amounts as shall be
sufficient to cover the costs and expenses of
<PAGE>   48
collection (including reasonable counsel fees and disbursements), or to enforce
any other legal or equitable right of the holder of such Series No. 1 Notes.

         SECTION 7.5 Remedies Cumulative. No remedy conferred in this Agreement
or in the other Purchase Documents upon the Noteholders is intended to be
exclusive of any other remedy and each and every such remedy shall be cumulative
and shall be in addition to every other remedy given hereunder or now or
hereafter existing at law or in equity or otherwise.

                                  ARTICLE VIII

                                 MISCELLANEOUS

         SECTION 8.1 Waivers, Amendments, etc. The provisions of this Agreement
and of each Purchase Document may from time to time be amended, waived or
otherwise modified, if such amendment, waiver or modification is in writing and
consented to by the Company and the Required Noteholders; provided, however,
that no such amendment, waiver or modification:

                  (a) which would modify any requirement hereunder that any
         particular action be taken by each Noteholder or by the Required
         Noteholders shall be effective unless consented to by each Noteholder
         or the Required Noteholders, as the case may be; or

                  (b) which would modify this Section or change the definition
         of "Required Noteholders" or which would extend the due date for, or
         reduce the amount of, any payment or prepayment of principal of or
         interest on any Series No. 1 Note (or reduce the rate of interest on
         any Series No. 1 Note) shall be made without the consent of each
         Noteholder.

No failure or delay on the part of the Purchaser or any other Noteholder in
exercising any power or right under this Agreement or any other Purchase
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice to or demand on
the Company in any case shall entitle it to any notice or demand in similar or
other circumstances. No waiver or approval by the Purchaser or any other
Noteholder under this Agreement or any other Purchase Document shall, except as
may be otherwise stated in such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any similar or
dissimilar waiver or approval thereafter to be granted hereunder.

         SECTION 8.2 Notices. All notices and other communications provided to
any party hereto under this Agreement or any other Purchase Document shall be in
writing and addressed or delivered to it at its address set forth below its
signature hereto or at such other address as may be designated by such party in
a notice to the other parties. Any notice, if sent by mail or courier and
properly addressed and prepaid, shall be deemed given when received; any notice,
if transmitted by facsimile, shall be deemed given when transmitted and
electronically confirmed.

         SECTION 8.3 Costs and Expenses. The Company agrees to pay all
reasonable out-of-pocket expenses of the Purchaser for the negotiation,
preparation, execution and delivery of this Agreement and each other Purchase
Document, including Schedules and Exhibits, and any amendments, waivers,
<PAGE>   49
consents, supplements or other modifications to this Agreement, any other
Purchase Document, any Subject Security or the Registration Agreement as may
from time to time hereafter be required (including the reasonable fees and
expenses of counsel for the Purchaser from time to time incurred in connection
therewith), whether or not the Transaction is consummated, and to pay all
reasonable out-of-pocket expenses of the Purchaser (including reasonable fees
and expenses of counsel to the Purchaser) incurred in connection with the
preparation and review of the form of any Instrument relevant to this Agreement,
any other Purchase Document, any Subject Security or the Registration Agreement
and the consideration of legal questions relevant hereto and thereto or to any
enforcement or preservation of rights as to, or restructuring or "work-out" of,
any Obligations or the rights and preferences of any Subject Security. The
Company also agrees to reimburse the Noteholders upon demand for all reasonable
out-of-pocket expenses (including reasonable attorneys' fees and legal expenses
of a single law firm representing all Noteholders) incurred by the Noteholders
to enforce or to preserve rights as to, or to restructure or "work out", any
Obligations.

         SECTION 8.4 Indemnification. In consideration of the execution and
delivery of this Agreement by the Purchaser, the Company hereby indemnifies,
exonerates and holds the Purchaser and each other Noteholder and each of their
respective officers, directors, employees, trustees and agents (the "Indemnified
Parties") free and harmless from and against any and all actions, causes of
action, suits, losses, costs, liabilities and damages and expenses actually
incurred in connection therewith (irrespective of whether such Indemnified Party
is a party to the action for which indemnification hereunder is sought),
including reasonable attorneys' fees and disbursements (the "Indemnified
Liabilities"), incurred by the Indemnified Parties or any of them as a result
of, or arising out of, or relating to:

                  (a) any transaction financed or to be financed in whole or in
         part, directly or indirectly, with the proceeds of any Series No. 1
         Note,

                  (b) the entering into and performance of this Agreement and
         any other Purchase Document by any of the Indemnified Parties
         (including any action brought by or on behalf of the Company as the
         result of any determination by the Purchaser pursuant to Article III to
         not purchase the Subject Securities), or

                  (c) any investigation, litigation or proceeding related to the
         Transaction,

excluding, however, any such Indemnified Liabilities arising for the account of
a particular Indemnified Party by reason of the relevant Indemnified Party's
gross negligence or wilful misconduct. If, and to the extent that, the foregoing
undertaking may be unenforceable for any reason, the Company hereby agrees to
make the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under Applicable Law.

         SECTION 8.5 Survival. The obligations of the Company under clauses (b)
and (c) of Section 6.1 and clause (b) of Section 6.2 shall survive the payment
in full of all Obligations and the termination of any other provisions of this
Agreement or any other Purchase Document and shall continue for the benefit of
the Purchaser for so long as it shall hold any Subject Securities. The
obligations of the Company under Section 8.4 shall remain in full force and
effect, regardless of any investigation made by or on behalf of any Indemnified
Party, and the obligations of the Company under Sections 8.3 and 8.4 shall
survive the payment or prepayment of the Subject Securities, at maturity, upon
redemption or otherwise, any transfer of the Subject Securities by the
Purchaser, and any termination of this Agreement and the other Purchase
<PAGE>   50
Documents. The representations and warranties made by the Company in this
Agreement and in each other Purchase Document shall survive the execution and
delivery of this Agreement and each such other Purchase Document.

         SECTION 8.6 Severability. Any provision of this Agreement or any other
Purchase Document 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 of this
Agreement or such Purchase Document or affecting the validity or enforceability
of such provision in any other jurisdiction.

         SECTION 8.7 Headings. The various headings of this Agreement and of
each other Purchase Document are inserted for convenience only and shall not
affect the meaning or interpretation of this Agreement or such Purchase Document
or any provisions hereof or thereof.

         SECTION 8.8 Counterparts. This Agreement may be executed by the
parties hereto in several counterparts, each of which shall be executed by the
Company and the Purchaser and be deemed to be an original and all of which shall
constitute together but one and the same agreement.

         SECTION 8.9 Governing Law. This Agreement, the Series No. 1 Notes, the
Subsidiary Guaranty and each other Purchase Document shall each be deemed to be
a contract made under and governed by the internal laws of the State of New
York.

         SECTION 8.10 JURISDICTION. FOR PURPOSE OF ANY ACTION OR PROCEEDING
INVOLVING THIS AGREEMENT OR ANY OTHER PURCHASE DOCUMENT, THE COMPANY HEREBY
EXPRESSLY SUBMITS TO THE JURISDICTION OF ALL FEDERAL AND STATE COURTS LOCATED IN
THE CITY OF NEW YORK, STATE OF NEW YORK AND CONSENTS THAT IT MAY BE SERVED WITH
ANY PROCESS OR PAPER BY REGISTERED MAIL OR BY PERSONAL SERVICE WITHIN OR WITHOUT
THE STATE OF NEW YORK, PROVIDED A REASONABLE TIME FOR APPEARANCE IS ALLOWED.

         SECTION 8.11 Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:

                  (a) the Company may not assign or transfer its rights or
         obligations hereunder without the prior written consent of all
         Noteholders; and

                  (b) the rights of sale, assignment, and transfer of the Series
         No. 1 Notes are subject to Section 4.7.

         SECTION 8.12 WAIVER OF JURY TRIAL. THE PURCHASER AND THE COMPANY
HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER PURCHASE DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN)
OR ACTIONS OF THE PURCHASER OR THE COMPANY. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE PURCHASER ENTERING INTO THIS AGREEMENT.

                            [signature pages follow]
<PAGE>   51
         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.

                             MCM CAPITAL GROUP, INC.

                             By: /s/ Robert E. Koe
                                ---------------------------------
                                 Name: Robert E. Koe

                                 Title: President

                             Address:       4302 East Broadway
                                            Phoenix, Arizona 85040
                             Telephone:     (602) 707-0211
                             Facsimile:     (602) 707-5509

                             Attention:     President

                             Copy to:       Timothy W. Moser, Esq.
                                            Squire, Sanders & Dempsey LLP
                                            40 North Central Avenue, Suite 2700
                                            Phoenix, AZ 85004

                             ING (U.S.) CAPITAL LLC

                             By: /s/ David Balestrery
                                 ----------------------------------
                                 Name: David Balestrery

                                 Title:     Vice President

                             Address:       55 East 52nd Street
                                            New York, New York 10015
                             Telephone:     (212) 409-1955
                             Facsimile:     (212) 593-3360

                             Attention:     David A. Balestrery
                                            Ira Braunstein

                             Copy to:       David K. Duffee, Esq.
                                            Mayer, Brown & Platt
                                            1675 Broadway
                                            New York, New York 10019-5820

                             Payments to:     The Chase Manhattan Bank
                                                   (ABA No. 021000021)
                                                   Account No. 930 103 5763

                                       S-1
<PAGE>   52
                             Confirmation to: David A. Balestrery/Ira Braunstein

                                       2<PAGE>   1
                                                                    EXHIBIT 10.2

                                WARRANT AGREEMENT

                          dated as of January 12, 2000

                                     between

                             MCM CAPITAL GROUP, INC.

                                       and

                             ING (U.S.) CAPITAL LLC

                                       for
                              Warrants to Purchase
                         428,571 shares of Common Stock

<PAGE>   2
                                WARRANT AGREEMENT

      This WARRANT AGREEMENT, dated as of January 12, 2000 (this "Agreement") is
entered into by and between MCM Capital Group, Inc., a Delaware corporation (the
"Company"), and ING (U.S.) Capital LLC, a Delaware limited liability company
(the "Purchaser").

                             W I T N E S S E T H:

      WHEREAS, the Company is a party with the Purchaser to a note purchase
agreement, dated as of January 12, 2000 (the "Note Purchase Agreement"),
pursuant to which the Company has agreed, on and subject to the occurrence of
the Closing Date under the Note Purchase Agreement, to issue and sell to the
Purchaser the Warrants which, subject to the adjustments provided herein,
entitle the Purchaser to purchase 428,571 shares of common stock, $.01 par value
per share, of the Company (the "Common Stock").

      NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements and covenants hereinafter set forth and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, and
intending to be legally bound hereby, the parties hereto hereby agree as
follows:

                                    ARTICLE I
                                   DEFINITIONS

      Section 1.01.  CERTAIN DEFINED TERMS. Unless the context otherwise
requires, the following terms, when used in this Agreement, shall have the
respective meanings specified below :

      "Additional Notes" shall mean up to $40,000,000 in aggregate principal
amount of notes issued by the Company subsequent to the Closing Date pursuant to
Section 6.2.2(b) of the Note Purchase Agreement.

      "Additional Warrants" shall mean warrants, options or similar rights to
purchase Common Stock on terms and conditions, and in a form, substantially
similar to the Warrants, which are issued to the purchasers of Additional Notes
in connection with the sale of such Additional Notes by the Company and the
purchase thereof by such purchaser.

      "Affiliate" shall have the meaning specified in the Note Purchase
Agreement.

      "Agreement" or "this Agreement" shall have the meaning specified in the
preamble to this Agreement.

      "Board" shall mean the board of directors of the Company.

                                       1
<PAGE>   3

      "Closing Date" shall have the meaning specified in the Note Purchase
Agreement.

      "Common Stock" shall have the meaning specified in the recitals to this
Agreement.

      "Company" shall have the meaning specified in the preamble to this
Agreement.

      "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations thereunder.

      "Exercise Price" shall have the meaning specified in Section 3.01.

      "Expiration Date" shall be January 12, 2005.

      "Fair Market Value" shall mean, with respect to any shares of Common Stock
as of any date of determination, (i) if such shares of Common Stock are not
Publicly Traded, the fair value of such shares of Common Stock (A) as determined
reasonably and in good faith in the most recently completed arm's-length
transaction between the Company and an unaffiliated third party in which such
determination is necessary and the closing of which shall have occurred within
the six months preceding such date of determination, or (B) if no such
transaction shall have occurred within such six-month period, as determined in
accordance with the Valuation Criteria reasonably and in good faith by an
Independent Financial Expert appointed by the Board and consented to by the
Purchaser (such consent not to be unreasonably withheld); or (ii) if such shares
of Common Stock are Publicly Traded, the Market Price of such shares of Common
Stock on the trading day immediately preceding such date of determination;
provided, however, that with respect to shares of Common Stock issuable upon the
exercise of options under a stock option plan or the issuance of shares of
Common Stock under an employee stock incentive plan, the Fair Market Value of
such shares shall be determined in accordance with the applicable provisions of
such plan (if any).

      "Holders" shall mean the registered holders from time to time of the
Warrants and, unless otherwise provided or indicated herein, the registered
holders from time to time of the Underlying Common Stock.

      "Incremental Note Principal" shall mean, with respect to any issuance of
Additional Notes, the sum of aggregate principal amount of such Additional
Notes, plus the aggregate principal amount of all Additional Notes issued prior
thereto.

      "Incremental Warrant Shares" shall mean, with respect to any issuance of
Additional Warrants, the sum of the number of shares of Common Stock issuable
upon exercise of such Additional Warrants, plus the number of shares of Common
Stock issuable upon exercise of all Additional Warrants issued prior thereto.

      "Independent Financial Expert" shall mean a nationally recognized
investment banking firm (i) that does not (and whose directors, officers,
employees and affiliates do not) have a direct or indirect financial interest in
the Company or any of its Affiliates, and (ii) that is not, and none of whose
directors, officer, employees or Affiliates are, at the time it is called upon
to

                                       2
<PAGE>   4

render independent financial advice to the Company, a promoter, director or
officer of the Company or any of its Affiliates or an underwriter or placement
agent with respect to any of the securities of the Company or any of its
Affiliates, nor have the Company or any such directors, officers, employees or
Affiliates acted in such capacity during the three year period prior thereto.

       "Market Price" shall mean, with respect to any shares of Common Stock
that are Publicly Traded, for any specified trading day, (i) in the case of
shares of Common Stock listed or admitted to trading on any securities exchange
or on the Nasdaq National Market or the Nasdaq SmallCap Market, the average
closing price, or if no sale takes place on a particular day, the average of the
closing bid and asked prices on such day, for the ten (10) trading days prior to
the date in question, (ii) in the case of shares of Common Stock not then listed
or admitted to trading on any securities exchange or on the Nasdaq National
Market or the Nasdaq SmallCap Market, the average last reported sale price, or
if no sale takes place on a particular day, the average of the closing bid and
asked prices on such day, for the ten (10) trading days prior to the date in
question, as reported by a reputable quotation source designated by the Company,
and (iii) if there are no bid and asked prices reported during the ten (10)
trading days prior to the specified date, the Fair Market Value of such shares
of Common Stock as determined as if such shares of Common Stock were not
Publicly Traded.

      "Note Purchase Agreement" shall have the meaning specified in the recitals
to this Agreement.

      "Person" shall mean any individual, corporation, partnership, association,
joint-stock company, trust, unincorporated organization or other entity or any
government or political subdivision, agency or instrumentality thereof, as well
as any syndicate or group that would be deemed to be a person under Section
13(d)(3) of the Exchange Act.

      "Publicly Traded" shall mean, relative to any security, that such security
is (i) listed on a domestic securities exchange, (ii) quoted on the Nasdaq
National Market or the Nasdaq SmallCap Market, or (iii) traded in the domestic
over-the-counter market, which trades are reported on the OTC Electronic
Bulletin Board or reported by the National Quotation Bureau, Incorporated.

      "Purchaser" shall have the meaning specified in the preamble to this
Agreement.

      "Rights" shall mean any "poison pill" or similar shareholder rights issued
pursuant to a "poison pill" shareholder rights plan or similar plan.

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

      "Series No. 1 Note" shall have the meaning specified in the Note
Purchase Agreement.

      "Series No. 1 Note Ratio" shall mean a fraction, the numerator of which
is the aggregate original principal amount of the Series No. 1 Notes and the
denominator of which is the Incremental Note Principal.

                                       3
<PAGE>   5

      "Taxes" shall mean all transfer, stamp, documentary and other similar
taxes, assessments or charges levied by any governmental or revenue authority in
respect hereof in respect of any Warrant or any Warrant Certificate, excluding,
however, franchise taxes and taxes, assessments or charges levied or imposed on
or measured by the net income or receipts of any Person.

      "Underlying Common Stock" shall mean the shares of Common Stock issuable
or issued upon the exercise of the Warrants.

      "Valuation Criteria" shall mean one or more valuation methods that the
Independent Financial Expert or the Board, as the case may be, in its
professional or reasonable business judgment, as the case may be, determines to
be most appropriate for use in determining the Fair Market Value of any
securities for which such determination is required pursuant to this Agreement.

      "Warrant Certificates" shall have the meaning specified in Section 2.01 of
this Agreement.

      "Warrants" shall mean the warrants issued to the Purchaser on the Closing
Date as contemplated by this Agreement and the Note Purchase Agreement, which
warrants initially entitle the Purchaser to purchase 428,571 shares of Common
Stock.

                                   ARTICLE II
                      ORIGINAL ISSUE OF WARRANTS; TRANSFER

      Section 2.01. FORM OF WARRANT CERTIFICATES. The Warrants shall be
evidenced by certificates in registered form only and substantially in the form
attached hereto as Exhibit A (the "Warrant Certificates"), shall be dated the
date on which signed by the Company and may have such legends and endorsements
typed, stamped, printed, lithographed or engraved thereon as the Company may
deem appropriate and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law or with any rule or
regulation applicable thereto, with any rule or regulation of any securities
exchange or association on which the Warrants may be listed, or to conform to
customary usage.

      Section 2.02. EXECUTION AND DELIVERY OF WARRANT CERTIFICATES. Warrant
Certificates evidencing the Warrants shall be executed by the Company and
delivered on the Closing Date to the Purchaser. The Warrant Certificates shall
be executed on behalf of the Company by one or more duly authorized officers of
the Company.

      Section 2.03.  TRANSFER OF WARRANTS.

            (a) Subject to clause (b) of this Section 2.03 and provided that all
conditions to transfer set forth in this Agreement and in the Note Purchase
Agreement have been satisfied, each Warrant and the rights thereunder may be
transferred by the Holder thereof delivering to the Company the Warrant
Certificate evidencing such Warrant accompanied by a properly completed
assignment form (a form of which is attached to the form of Warrant Certificate

                                       4
<PAGE>   6

attached as Exhibit A to this Agreement). Within ten (10) Business Days of
receipt of such assignment form, the Company shall issue and deliver to the
transferee, subject to clause (b) below, a Warrant Certificate of like kind and
tenor representing the transferred Warrants and to the transferor a Warrant
Certificate of like kind and tenor representing any Warrants evidenced by such
original certificate that are not being transferred. Each Warrant Certificate
issued pursuant to this Section 2.03 shall be substantially in the form of
Exhibit A to this Agreement and shall bear the restrictive legends set forth
thereon (unless, with respect to the legend regarding transfer under applicable
securities laws, the Holder or transferee thereof supplies to the Company an
opinion of counsel, reasonably satisfactory to the Company, that the
restrictions described in such legend are no longer applicable to such
Warrants).

            (b) The transfer of Warrants shall be permitted only pursuant to a
transaction that complies with, or is exempt from, the provisions of the
Securities Act and any applicable provisions of state securities laws, and the
Company may require an opinion of counsel, reasonably satisfactory to the
Company, to such effect prior to the transfer of any Warrant.

                                   ARTICLE III
                 EXERCISE PRICE; EXERCISE OF WARRANTS GENERALLY

      Section 3.01. EXERCISE PRICE. Each Warrant Certificate shall entitle the
Holder thereof, subject to the provisions of the Agreement, to purchase one
share of Common Stock for each Warrant represented thereby at an exercise price
(the "Exercise Price") of $0.01 per share.

      Section 3.02. EXERCISE OF WARRANTS. Subject to the terms and conditions
set forth herein, the Warrants shall be exercisable beginning on the 91st day
after the Closing Date through the Expiration Date, as follows: (i) for the
period beginning on the 91st day after the Closing Date and ending on the 270th
day after the Closing Date, for not more than 50% of the aggregate number of
shares of Common Stock issuable upon exercise of the Warrants from time to time
(giving effect to the adjustments contemplated by Section 4.01 of this
Agreement); and (ii) beginning on the 271st day after the Closing Date and
ending on the Expiration Date, for up to 100% of the aggregate number of shares
of Common Stock issuable upon exercise of the Warrants from time to time.

      Section 3.03. EXPIRATION OF WARRANTS.  The Warrants shall terminate and
become void as of the close of business on the Expiration Date.

      Section 3.04. METHOD OF EXERCISE.

            (a) In order to exercise a Warrant, the Holder thereof must
surrender the Warrant Certificate evidencing such Warrant to the Company, with
one of the forms on the reverse of or attached to the Warrant Certificate duly
executed, and by paying in full to the Company (i) by wire transfer of
immediately available funds, or (ii) by certified or official bank check, or
(iii) by any combination of the foregoing, the Exercise Price for each share of
Underlying Common Stock as to which Warrants are then being exercised. A Holder
may exercise such Holder's Warrant for the full number of shares of Underlying
Common Stock

                                       5
<PAGE>   7

issuable upon exercise thereof (subject to the limitations set forth in Section
3.02) or any lesser number of whole shares of Underlying Common Stock.

            (b) Not later than the fifth Business Day following the later of (i)
surrender of a Warrant Certificate in conformity with the foregoing provisions
or (ii) payment by the Holder of the full Exercise Price for the shares of
Underlying Common Stock as to which such Warrants are then being exercised, the
Company shall transfer to the Holder of such Warrant Certificate appropriate
evidence of ownership of any shares of Underlying Common Stock or other
securities or property (including any money) to which the Holder is entitled,
registered or otherwise placed in, or payable to the order of, such name or
names as may be directed in writing by the Holder, and shall deliver such
evidence of ownership and any other securities or property (including any money)
to the person or persons entitled to receive the same, together with an amount
in cash in lieu of any fraction of a share as provided in Section 4.04. If such
Warrant Certificate shall not have been exercised in full, the Company will
issue to such Holder a new Warrant Certificate exercisable for the number of
shares of Underlying Common Stock as to which such Warrant shall not have been
exercised. Any registration of Underlying Common Stock issued upon exercise of a
Warrant in the name of any person other than the registered holder of the
Warrant shall be subject to Sections 5.03 and 5.04 of this Agreement.

            (c) Each person in whose name any certificate representing shares of
Underlying Common Stock is issued shall for all purposes be deemed to have
become the holder of record of such shares of Underlying Common Stock on the
date on which the Warrant Certificate was surrendered to the Company and payment
of the Exercise Price therefor, irrespective of the date of delivery of such
certificate representing shares of Underlying Common Stock.

      Section 3.05. CANCELLATION OF WARRANTS. The Company shall cancel any
Warrant Certificate delivered to it for exercise, in whole or in part, or
delivered to it for transfer, exchange or substitution, and no Warrant
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Company shall destroy canceled
Warrant Certificates. If the Company shall acquire any of the Warrants, such
acquisition shall not operate as a redemption or termination of the right
represented by such Warrants unless and until the Warrant Certificates
evidencing such Warrants are surrendered to the Company for cancellation.

                                   ARTICLE IV
                                   ADJUSTMENTS

      Section 4.01. ADJUSTMENTS.  The number of shares of Common Stock
issuable upon exercise of each Warrant shall be subject to adjustment from
time to time as follows:

            (a) Stock Dividends; Stock Splits; Reverse Stock Splits;
Reclassifications. In the event that the Company shall (i) pay a dividend or
make any other distribution with respect to its Common Stock in shares of its
capital stock, (ii) subdivide its outstanding Common Stock, (iii) combine its
outstanding Common Stock into a smaller number of shares, or (iv) issue any
shares of its capital stock in a reclassification of the Common Stock (including
any such

                                       6
<PAGE>   8

reclassification in connection with a merger, consolidation or other business
combination in which the Company is the continuing corporation), the number of
shares of Common Stock issuable upon exercise of each Warrant immediately prior
to the record date for such dividend or distribution, or the effective date of
such subdivision or combination, shall be adjusted so that the Holder of each
Warrant shall thereafter be entitled to receive the kind and number of shares of
Common Stock or other securities of the Company that such Holder would have
owned or have been entitled to receive after the happening of any of the events
described above, had such Warrant been exercised immediately prior to the
happening of such event or any record date with respect thereto. An adjustment
made pursuant to this Section 4.01(a) shall become effective immediately after
the effective date of such event retroactive to the record date, if any, for
such event.

            (b)   Issuance of Common Stock, Rights, Options or  Warrants at
Lower Values.

                  (i) In the event that the Company shall issue or sell shares
of Common Stock, or rights, options, warrants or convertible or exchangeable
securities containing the right to subscribe for or purchase shares of Common
Stock, at a price per share of Common Stock (determined in the case of such
rights, options, warrants or convertible or exchangeable securities, by dividing
(x) the total amount of Consideration receivable by the Company in respect of
the issuance and sale of such rights, options, warrants or convertible or
exchangeable securities, plus the total Consideration, if any, payable to the
Company upon exercise, conversion or exchange thereof, by (y) the total number
of shares of Common Stock covered by such rights, options, warrants or
convertible or exchangeable securities) that is lower than the then Fair Market
Value per share of the Common Stock immediately prior to such sale or issuance,
then the number of shares of Common Stock thereafter issuable upon the exercise
of each Warrant then outstanding shall equal the Pre-Issuance Value per Warrant
divided by the Unadjusted Post-Issuance Value per Warrant. Such adjustment shall
be made successively whenever any such sale or issuance is made.

                  (ii) For purposes of this Section 4.01(b), (A) "Pre-Issuance
Value per Warrant" shall mean (1) the total number of shares of Common Stock
then issuable upon exercise of each Warrant, multiplied by (2) the Fair Market
Value per share of Common Stock immediately prior to any issuance or sale
described in Section 4.01(b)(i); and (B) "Unadjusted Post-Issuance Value per
Warrant" shall mean (1) the sum of (x) the total number of shares of Common
Stock (including shares of Common Stock issuable upon exercise of outstanding
Warrants and Additional Warrants) outstanding immediately prior to any issuance
or sale described in Section 4.01(b)(i), multiplied by the Fair Market Value per
share of Common Stock immediately prior to such issuance or sale, plus (y) the
total number of additional shares of Common Stock issued or sold by the Company
(including, in the case of rights, options, warrants or convertible or
exchangeable securities, the total number of shares of Common Stock covered by
such rights, options, warrants or convertible or exchangeable securities),
multiplied by the price per share of Common Stock for which such additional
shares of Common Stock were issued or sold (including, in the case of rights,
options, warrants or convertible or exchangeable securities, the total amount of
Consideration per share receivable by the Company in respect of the issuance and
sale of such rights, options, warrants or convertible or exchangeable
securities, plus the total Consideration per share, if any, payable to the
Company upon exercise, conversion

                                       7
<PAGE>   9

or exchange thereof), divided by (2) the total number of shares of Common Stock
outstanding immediately after such issuance or sale (including, in the case of
rights, options, warrants or convertible or exchangeable securities, the total
number of shares of Common Stock covered by such rights, options, warrants or
convertible or exchangeable securities and including shares of Common Stock
issuable upon exercise of outstanding Warrants and Additional Warrants).

                  (iii) In the event that the Company shall issue and sell
shares of Common Stock or rights, options, warrants or convertible or
exchangeable securities containing the right to subscribe for or purchase shares
of Common Stock for consideration consisting, in whole or in part, of property
other than cash or its equivalent, then in determining the "price per share of
Common Stock" and the "Consideration" receivable by or payable to the Company
for purposes of this Section 4.01, the Board shall determine, in good faith, the
fair value of such property. In the event that the Company shall issue and sell
rights, options, warrants or convertible or exchangeable securities containing
the right to subscribe for or purchase shares of Common Stock, together with one
or more other securities as part of a unit at a price per unit, then in
determining the "price per share of Common Stock" and the "Consideration"
receivable by or payable to the Company for purposes of this Section 4.01, the
Board shall determine, in good faith, the fair value of the rights, options,
warrants or convertible or exchangeable securities then being sold as part of
such unit.

                  (iv) Any adjustment to the number of shares of Common Stock
issuable upon exercise of all Warrants then outstanding made pursuant to this
Section 4.01(b) shall be allocated among each Warrant then outstanding on a pro
rata basis.

                  (v) Notwithstanding anything herein to the contrary, the
provisions of this Section 4.01(b) shall not apply to any of the following:

                        (A) the grant or issuance of restricted stock,
options or other similar rights issued pursuant to employee stock option plans,
directors stock option plans or similar plans providing for options or other
similar rights to purchase Common Stock covering in the aggregate not in excess
of 20% of the fully-diluted shares of Common Stock issued and outstanding from
time to time, or the issuance of shares upon exercise of any such options or
other similar rights,

                        (B) the issuance of shares upon the exercise of options,
warrants, convertible or exchangeable securities, or similar securities that are
convertible into Common Stock in accordance with their terms, that are issued
and outstanding as of the date of this Agreement (giving effect to the
transactions relating to the issuance of the Series No. 1 Notes, including
without limitation the issuance of the Warrants),

                        (C) the issuance of any Additional Warrants,

                        (D) the issuance of any Rights,

                        (E) the issuance of shares of capital stock
pursuant to any stock dividend, stock split or other distribution in respect
of outstanding shares, and

                                       8
<PAGE>   10

                        (F) the issuance of Common Stock or securities
convertible into Common Stock pursuant to an underwritten offering (including,
without limitation, any such securities issued pursuant to the underwriters'
overallotment option).

            (c) Sale of Additional Notes. In the event that the Company shall
issue or sell any Additional Notes and, in connection therewith, shall issue any
Additional Warrants, the aggregate number of shares of Common Stock thereafter
issuable upon the exercise of the Warrants then outstanding shall equal (i) the
product obtained by multiplying the Series No. 1 Note Ratio by the Incremental
Warrant Shares, minus (ii) the number of shares of Underlying Common Stock, if
any, that have theretofore been issued upon exercise of Warrants; provided,
however, that no adjustment pursuant to this subsection (c) shall reduce the
number of shares issuable upon exercise of a Warrant.

            (d) Issuance of Rights. In the event that the Company shall
distribute any Rights prior to the exercise or expiration of the Warrants, the
Company shall make proper provision so that each Holder who exercises a Warrant
after the record date for such distribution and prior to the expiration or
redemption of the Rights shall be entitled to receive upon such exercise, in
addition to the shares of Common Stock issuable upon such exercise, a number of
Rights determined as follows: (A) if such exercise occurs on or prior to the
date fixed for the distribution to the holders of Rights of separate securities
evidencing such Rights, the same number of Rights to which a holder of a number
of shares of Common Stock equal to the number of shares of Underlying Common
Stock issuable upon such exercise would have been entitled at the time of such
exercise in accordance with the terms and provisions applicable to the Rights,
and (B) if such exercise occurs after such distribution date, the same number of
Rights to which a holder of the number of shares of Underlying Common Stock into
which the Warrant so exercised was exercisable immediately prior to such
distribution date would have been entitled on the distribution date in
accordance with the terms and provisions applicable to the Rights.

            (e) Expiration Of Rights, Options and Conversion Privileges. Upon
the expiration of any rights, options, warrants or conversion or exchange
privileges that have previously resulted in an adjustment pursuant to Section
4.01(b) or Section 4.01(c), if any thereof shall not have been exercised, the
number of shares of Common Stock issuable upon the exercise of each Warrant
shall, upon such expiration, be readjusted and shall thereafter, upon any future
exercise, be such as they would have been had they been originally adjusted (or
had the original adjustment not been required, as the case may be) as if (i) the
only shares of Common Stock so issued were the shares of Common Stock, if any,
actually issued or sold upon the exercise of such rights, options, warrants or
conversion or exchange rights and (ii) such shares of Common Stock, if any, were
issued or sold for the Consideration actually received by the Company upon such
exercise plus the Consideration, if any, actually received by the Company for
issuance, sale or grant of all such rights, options, warrants or conversion or
exchange rights whether or not exercised.

            (f) De Minimis Adjustments. No adjustment in the number of shares of
Common Stock issuable hereunder shall be required unless such adjustment would
require an increase or decrease of at least one percent in the number of share
of Common Stock purchasable upon an

                                       9
<PAGE>   11

exercise of each Warrant; provided, however, that any adjustments which by
reason of this Section 4.01(f) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
shall be made to the nearest one-tenth of a share.

      Section 4.02. DETERMINATION OF ADJUSTMENT. Whenever the number of shares
of Common Stock issuable upon the exercise of each Warrant is adjusted as herein
provided, a certificate of an officer of the Company setting forth the number of
shares of Common Stock issuable upon the exercise of each Warrant after such
adjustment, setting forth a brief statement of the facts requiring such
adjustment and setting forth the computation by which such adjustment was made
(in reasonable detail), shall, absent demonstrable error, be conclusive evidence
of such adjustment. The Company shall be entitled to rely on such certificate
and shall exhibit the same from time to time to any Holder desiring an
inspection thereof during normal business hours.

      Section 4.03. STATEMENT ON WARRANTS. Irrespective of any adjustment in the
number or kind of shares issuable upon the exercise of the Warrants,
certificates evidencing Warrants theretofore or thereafter issued may continue
to express the same price and number and kind of shares as are stated in the
Warrants initially issuable pursuant to this Agreement.

      Section 4.04. FRACTIONAL INTEREST. The Company shall not be required to
issue fractional shares of Common Stock on the exercise of Warrants. If more
than one Warrant shall be presented for exercise in full at the same time by the
same Holder, the number of full shares of Common Stock which shall be issuable
upon such exercise thereof shall be computed on the basis of the aggregate
number of shares of Common Stock acquirable on exercise of the Warrants so
presented. If any fraction of a share of Common Stock would, except for the
provisions of this Section 4.04, be issuable on the exercise of any Warrant (or
specified portion thereof), the Company shall pay an amount in cash calculated
by it to be equal to the then Fair Market Value per share of Common Stock
multiplied by such fraction computed to the nearest whole cent.

                                    ARTICLE V
                              ADDITIONAL AGREEMENTS

      Section 5.01. WARRANT TRANSFER BOOKS.

            (a) The Warrant Certificates shall be issued in registered form
only. The Company shall keep at its executive office a register in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of Warrant Certificates and of transfers or
exchanges of Warrant Certificates as herein provided.

            (b) Every Warrant Certificate surrendered for registration of
transfer or exchange shall (if so required by the Company) be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to the
Company, duly executed by the Holder thereof or his attorney duly authorized in
writing.

                                       10
<PAGE>   12

      Section 5.02. NO STOCK RIGHTS. Prior to the exercise of the Warrants, no
holder of a Warrant Certificate, as such, shall be entitled to vote or be deemed
the holder of Common Stock or any other securities of the Company which may at
any time be issuable on the exercise hereof, nor shall anything contained herein
be construed to confer upon any holder of a Warrant Certificate, as such, the
rights of a stockholder of the Company or the right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, to exercise any
preemptive right, to receive notice of meetings or other actions affecting
stockholders (except as specifically provided herein), or to receive dividends
or subscription rights or otherwise.

      Section 5.03. RESTRICTIONS ON TRANSFER. The Holder of any Warrant
Certificate, by acceptance thereof, acknowledges and agrees that the Warrants
and the Underlying Common Stock issuable upon exercise of such Warrants shall be
subject to the terms and conditions of the Note Purchase Agreement, as such
document may be in effect from time to time, including, without limitation, the
provisions therein relating to restrictions on transfer. Without limitation of
the obligations set forth in Section 5.07, it shall be a condition precedent to
any transfer of the Warrant that each proposed transferee execute and deliver to
the Company the documentation required by such Section 5.07.

      Section 5.04. NO REGISTRATION OF WARRANTS OR UNDERLYING COMMON STOCK UNDER
SECURITIES LAWS; OTHER REGULATORY FILINGS.

            (a) Neither the Warrants nor the Underlying Common Stock have been
registered under the Securities Act or any state securities laws.

            (b) The Holder of any Warrant Certificate, by acceptance thereof,
represents that it is acquiring the Warrants to be issued to it for its own
account and not with a view to the distribution thereof, and agrees not to sell,
transfer, pledge or hypothecate any Warrants or any Underlying Common Stock
unless (i) (A) such transfer is made in connection with an effective
registration statement under the Securities Act and any applicable state
securities laws or (B) the Holder thereof has furnished the Company a
satisfactory opinion of counsel for such Holder to the effect that such
transaction is exempt from the registration requirements of the Securities Act,
the rules and regulations in effect thereunder and any applicable state
securities laws, and (ii) such transfer is made in accordance with terms and
conditions set forth in the Note Purchase Agreement relating to restrictions on
transfer to the extent the Warrants or Underlying Common Stock are subject
thereto.

            (c) Each Holder of Warrants also hereby acknowledges that any
exercise of the Warrants may be subject to the filing requirements of the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and agrees to
make any such required filings prior to any such exercise.

      Section 5.05. RESERVATION OF COMMON STOCK FOR ISSUANCE ON EXERCISE OF
WARRANTS. The Company shall at all times reserve and keep available, out of its
authorized but unissued Common Stock, solely for the purpose of issue upon
exercise of Warrants as herein provided, such number of shares of Common Stock
as shall then be issuable

                                       11
<PAGE>   13

upon the exercise of all outstanding Warrants. All shares of Common Stock which
shall be so issuable shall, upon such issue and upon payment of the exercise
price therefor as provided herein and in the applicable Warrant Certificate, be
duly and validly issued and fully paid and non-assessable.

      Section 5.06. PAYMENT OF TAXES. The Company shall pay all Taxes that may
be imposed on the Company or on the Warrants or on any securities deliverable
upon exercise of Warrants with respect thereto. The Company shall not be
required, however, to pay any Taxes or other charges imposed in connection with
any transfer involved in the issue of any certificate for shares of Common Stock
or other securities underlying the Warrants or payment of cash to any person
other than the Holder of a Warrant Certificate surrendered upon the exercise or
purchase of a Warrant.

      Section 5.07. CERTAIN PERSONS TO EXECUTE AGREEMENT. Without in any way
limiting any transfer restrictions contained elsewhere herein or in the Note
Purchase Agreement, no Holder shall sell or otherwise transfer any Warrants held
by such Holder, unless, prior to the consummation of any such sale or other
disposition, the person to whom such sale or other disposition is proposed to be
made executes and delivers to the Company an agreement, in form and substance
satisfactory to the Company, whereby such prospective transferee confirms that,
with respect to the Warrants that are the subject of such sale or other
disposition, it shall be deemed to be a "Holder" for the purposes of this
Agreement and agrees to be bound by all the terms of this Agreement and all
applicable terms of the Note Purchase Agreement. Upon the execution and delivery
by such prospective transferee of the agreement referred to in the next
preceding sentence, and subject to all applicable transfer restrictions, such
prospective transferee shall be deemed a "Holder" for the purposes of this
Agreement, and shall have the rights and be subject to the obligations of a
Holder hereunder with respect to the Warrants held by such prospective
transferee.

                                   ARTICLE VI
                                  MISCELLANEOUS

      Section 6.01. EXPENSES. Except as otherwise specified in this Agreement or
in the Note Purchase Agreement, all costs and expenses, including, without
limitation, fees and disbursements of counsel, financial advisors and
accountants, incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such costs and
expenses.

      Section 6.02. NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed to have been duly given or made upon receipt) by delivery in
person, or by courier service, cable, telecopy, telegram, or registered or
certified mail (postage prepaid, return receipt requested) to the respective
parties hereto at their addresses set forth on the signature pages to this
Agreement (or at such other address for a party hereto as shall be specified in
a notice given in accordance with this Section 6.02).

                                       12
<PAGE>   14

      Section 6.03. HEADINGS. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning, construction or interpretation of this Agreement.

      Section 6.04. SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.

      Section 6.05. MUTILATED OR MISSING WARRANT CERTIFICATES. If any Warrant
Certificate is lost, stolen, mutilated or destroyed, the Company in its
discretion may issue, in exchange and substitution for and upon cancellation of
the mutilated Warrant Certificate, or in lieu of and substitution for the
Warrant Certificate lost, stolen or destroyed, and upon receipt of a proper
affidavit or other evidence satisfactory to the Company (and surrender of any
mutilated Warrant Certificate) and bond of indemnity in form and amount and with
corporate surety satisfactory to the Company in each instance protecting the
Company, a new Warrant Certificate of like tenor and exercisable for an
equivalent number of shares of Common Stock as the Warrant Certificate so lost,
stolen, mutilated or destroyed. Any such new Warrant Certificate shall
constitute an original contractual obligation of the Company, whether or not the
allegedly lost, stolen, mutilated or destroyed Warrant Certificate at any time
shall be enforceable by anyone. An applicant for such a substitute Warrant
Certificate also shall comply with such other reasonable regulations and pay
such other reasonable charges as the Company may prescribe. All Warrant
Certificates shall be held and owned upon the express condition that the
foregoing provisions are exclusive with respect to the replacement of lost,
stolen, mutilated or destroyed Warrant Certificates, and shall preclude any and
all other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement of negotiable
instruments or other securities without their surrender.

      Section 6.06. ENTIRE AGREEMENT. This Agreement and the documents referred
to herein constitute the entire agreement of the parties hereto with respect to
the subject matter hereof and supersede all prior agreements and undertakings,
both written and oral, between or among the parties with respect to the subject
matter hereof.

      Section 6.07. NO THIRD PARTY BENEFICIARIES. This Agreement shall be
binding upon and inure solely to the benefit of the parties hereto and their
respective successors and permitted assigns. Nothing in this Agreement, whether
express or implied, is intended to or shall confer upon any person other than
the parties hereto and their respective successors and permitted assigns, any
legal or equitable right, benefit or remedy of any nature whatsoever, under or
by reason of this Agreement.

                                       13
<PAGE>   15

      Section 6.08. AMENDMENT; WAIVER. This Agreement may not be amended,
modified, supplemented or waived except by an instrument in writing signed by,
or on behalf of, the Company and holders of more than 50% of the outstanding
Warrants or, in the case of a waiver, the party to be bound thereby (which, in
the case of the Holders of the Warrants, shall require Holders of more than 50%
of the outstanding Warrants).

      Section 6.09. GOVERNING LAW. IN ALL RESPECTS, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS OF
EACH PARTY ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
EXECUTED IN AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO
THE PRINCIPLES THEREOF REGARDING CONFLICT OF LAWS.

      Section 6.10. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.

      Section 6.11. PURCHASE DOCUMENT. This Agreement is a Purchase Document for
purposes of the Note Purchase Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof.

      Section 6.12. SPECIFIC PERFORMANCE. Each Holder shall have the right to
specific performance by the Company of the provisions of this Agreement, in
addition to any other remedies that it may have at law or in equity. The Company
hereby irrevocably waives, to the extent that it may do so under applicable law,
any defense based on the adequacy of a remedy at law which may be asserted as a
bar to the remedy of specific performance in any action brought against the
Company for specific performance of this Agreement by the Holders of the
Warrants or the Underlying Common Stock.

      Section 6.13. FILINGS. The Company shall, at its own expense and to the
extent it is reasonably able to do so, promptly execute and deliver, or cause to
be executed and delivered, to any Holder of Warrants all applications,
certificates, instruments and other documents that such Holder may reasonably
request in connection with the obtaining of any consent, approval, qualification
or authorization of any Federal, state or local government (or any agency or
commission thereof) necessary or appropriate in connection with, or for the
effective exercise of, any Warrants then held by such Holder, in each case
subject to such confidentiality obligations as the Company may reasonably impose
on such Holder; provided, however, that the Company shall not be required to
qualify to do business in, or provide a general consent to service of process
in, any jurisdiction in which it is not already qualified to do business and
shall not be required to register the Warrants or the Underlying Common Stock
under any federal or state securities laws except as otherwise required under
any registration rights agreement (or similar agreement) to which the Company
may be a party from time to time.

                                       14
<PAGE>   16

      Section 6.14. OTHER TRANSACTIONS. Nothing contained herein shall preclude
the Holder from engaging in any transaction, in addition to those contemplated
by this Agreement, with the Company or any of its Affiliates in which the
Company or such Affiliate is not restricted hereby from engaging with any other
Person.

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       15
<PAGE>   17

      IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date fast above written.

                                    MCM CAPITAL GROUP, INC.

                                    By:  /s/ Gregory G. Meredith
                                         ------------------------------------
                                         Name: Gregory G. Meredith
                                         Title: Secretary

                                    ING (U.S.) CAPITAL LLC

                                    By:  /s/ David Balestrery
                                         ------------------------------------
                                          Name: David Balestrery
                                          Title: Vice President

                                       16
<PAGE>   18

                                                                       EXHIBIT A

                          [FORM OF WARRANT CERTIFICATE]

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT BE
TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF, AND
NO REGISTRATION OF TRANSFER OF SUCH SECURITIES WILL BE MADE ON THE BOOKS OF THE
ISSUER, UNLESS (i) SUCH TRANSFER IS MADE IN CONNECTION WITH AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT AND ANY APPLICABLE STATE SECURITIES LAWS
OR (ii) THE COMPANY HAS BEEN FURNISHED WITH A SATISFACTORY OPINION OF COUNSEL
FOR THE HOLDER HEREOF THAT SUCH TRANSFER IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF SUCH ACT, THE RULES AND REGISTRATIONS IN EFFECT THEREUNDER AND
ANY APPLICABLE STATE SECURITIES LAWS.

THE SECURITIES EVIDENCED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE UPON
THE EXERCISE OF THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER
AND OTHER PROVISIONS SET FORTH IN A WARRANT AGREEMENT AND A NOTE PURCHASE
AGREEMENT, EACH DATED AS OF JANUARY 12, 2000, AS THEREAFTER AMENDED,
SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME, COPIES OF WHICH ARE ON
FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF THE ISSUER. NO REGISTRATION OF
TRANSFER OF SUCH SECURITIES WILL BE MADE ON THE BOOKS OF THE ISSUER UNLESS AND
UNTIL SUCH RESTRICTIONS SHALL HAVE BEEN COMPLIED WITH.

                             MCM CAPITAL GROUP, INC.

                               WARRANT CERTIFICATE
                              Dated as of _________, _____

               WARRANTS TO PURCHASE ____ SHARES OF COMMON STOCK

Certificate No. ___
Number of Warrants: __________

      MCM CAPITAL GROUP, INC., a corporation organized and existing under the
laws of the State of Delaware (the "Company"), hereby certifies that, for value
received, ING (U.S.) CAPITAL, LLC, or its registered assigns, is the registered
holder of the number of Warrants set forth above (the "Warrants"). Each Warrant
shall entitle the registered holder thereof (the "Holder"), during the time
periods specified below and subject to the provisions contained herein and in
the Warrant Agreement (as defined below), to receive from the Company one share
of Common Stock, par value $0.01 per share, of the Company ("Common Stock"),
subject to adjustment upon the occurrence of certain events as more fully
described in the Warrant

                                        1
<PAGE>   19

Agreement, at an exercise price of $0.01 per share. The Warrants shall be
exercisable beginning on April 12, 2000 through January 12, 2005 (the
"Expiration Date"), as follows: (i) for the period beginning on April 12, 2000
and ending on the October 9, 2000, for not more than 50% of the aggregate number
of shares of Common Stock issuable upon exercise of the Warrants from time to
time (giving effect to the adjustments contemplated by Section 4.01 of the
Warrant Agreement referred to below); and (ii) beginning on October 10, 2000 and
ending on the Expiration Date, for up to 100% of the aggregate number of shares
of Common Stock issuable upon exercise of the Warrants from time to time. This
Warrant Certificate shall terminate and become void as of the close of business
on the Expiration Date.

      This Warrant Certificate is issued under and in accordance with the
Warrant Agreement, dated as of January 12, 2000 (as thereafter amended, modified
or supplemented, the "Warrant Agreement"), among the Company and ING (U.S.)
Capital, LLC, and is subject to the terms and provisions contained in the
Warrant Agreement and in the Note Purchase Agreement (each such term is defined
in the Warrant Agreement), to all of which terms and provisions the Holder of
this Warrant Certificate consents by acceptance hereof, which applicable terms
and provisions are hereby incorporated herein by reference and made a part
hereof. Reference is hereby made to the Warrant Agreement and the Note Purchase
Agreement for a full statement of the respective rights, limitations of rights,
duties and obligations thereunder of the Company and the Holders of the
Warrants.

      The number of shares of Common Stock issuable upon the exercise of each
Warrant is subject to adjustment as provided in the Warrant Agreement.

      All shares of Common Stock issuable by the Company upon the exercise of
Warrants shall, upon such issue and upon payment of the Exercise Price in
accordance with the terms set forth in the Warrant Agreement, be duly and
validly issued and fully paid and non-assessable.

      In order to exercise a Warrant, the Holder hereof must surrender this
Warrant Certificate at the office of the Company, with the Form of Election to
Purchase attached hereto appropriately completed and duly executed by the Holder
hereof, all subject to the terms and conditions hereof and of the Warrant
Agreement.

      All terms used in this Warrant Certificate that are defined in the Warrant
Agreement shall have the meanings assigned to them in the Warrant Agreement.

      Copies of the Warrant Agreement are on file at the office of the Company
and may be obtained by writing to the Company at MCM Capital Group, Inc., 4302
East Broadway, Phoenix, Arizona 85042, Attention: Secretary.

            [THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

                                        2
<PAGE>   20

      IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
executed by its officers thereunto duly authorized as of the date first written
above.

                                    MCM CAPITAL GROUP, INC.

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

                                        3
<PAGE>   21

                          FORM OF ELECTION TO PURCHASE

(To Be Executed by the Holder to Exercise Warrants Evidenced by the Foregoing
Warrant Certificate)

To:  MCM Capital Group, Inc.

The undersigned hereby irrevocably elects to exercise the Warrants evidenced by
the foregoing Warrant Certificate for, and to acquire thereunder, one full share
(subject to adjustment) of Common Stock issuable upon exercise of each such
Warrant, all on the terms and conditions specified in the within Warrant
Certificate and the Warrant Agreement therein referred to. The undersigned
hereby surrenders this Warrant Certificate and all right, title and interest
therein to the Company and directs that the shares of Common Stock deliverable
upon the exercise of such Warrants be registered or placed in the name of the
undersigned at the address specified below and delivered thereto.

Address:    _________________________________________________

            _________________________________________________

            _________________________________________________
                        (Include Zip Code)

Name of Holder:   _________________________________________________

                                 (Please Print)

By: _________________________________________________
             (Signature)*

(Name:)___________________________________________

(Title:)____________________________________________

Dated: ___________________

                                       1
<PAGE>   22

                               FORM OF ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned Holder of the foregoing Warrant
Certificate hereby sells, assigns and transfers(1) unto each assignee set forth
below (including the undersigned with respect to any Warrants constituting a
part of the Warrants evidenced by the foregoing Warrant Certificate not being
assigned hereby) all of the rights of the undersigned in and to the number of
Warrants (as defined in and evidenced by the foregoing Warrant Certificate) set
forth opposite the name of such assignee below and in and to the foregoing
Warrant Certificate with respect to said Warrants and the shares of Common Stock
issuable upon exercise of said Warrants:

Name of Assignee:     ____________________________________________

                                 (Please Print)

Address:              _____________________________________________

                      _____________________________________________

                      _____________________________________________
                               (Include Zip Code)

Number of Warrants: ___________________

and does hereby irrevocably constitute and appoint the Company the undersigned's
attorney-in-fact to make such transfer on the books of the Company maintained
for that purpose, with full power of substitution in the premises.

_______________________

(1) THE SECURITIES EVIDENCED BY THE FOREGOING WARRANT CERTIFICATE ARE SUBJECT TO
CERTAIN RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS SET FORTH IN THE WARRANT
AGREEMENT AND THE NOTE PURCHASE AGREEMENT, COPIES OF WHICH ARE ON FILE AT THE
PRINCIPAL EXECUTIVE OFFICES OF THE ISSUER. NO REGISTRATION OF TRANSFER OF SUCH
SECURITIES WILL BE MADE ON THE BOOKS OF THE ISSUER UNLESS AND UNTIL SUCH
RESTRICTIONS SHALL HAVE BEEN COMPILED WITH.

                                        1
<PAGE>   23

If the total number of Warrants transferred shall not be all the Warrants
evidenced by the foregoing Warrant Certificate, the undersigned requests that a
new Warrant Certificate evidencing the Warrants not so assigned be issued in the
name of and delivered to the undersigned.

Dated: _______________

Name of Holder:   _________________________________________________

                                 (Please Print)

                  _________________________________________________
                                  (Signature)*

 (Name:)    __________________________________________

(Title:)    __________________________________________

                                       2

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