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EXHIBIT 10.1

[ELDORADO BANK LOGO]

LOAN AGREEMENT

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PRINCIPAL LOAN DATE MATURITY LOAN NO. CALL COLLATERAL ACCOUNT OFFICER INITIALS
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$2,500,000.00 04-19-1996 05-01-1997 13482 511 055 104121 GG1
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REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE
APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR
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BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17752 E. 17TH STREET
TUSTIN, CA 92680

THIS LOAN AGREEMENT BETWEEN BOYD'S WHEELS, INC. ("BORROWER") AND ELDORADO BANK
("LENDER") IS MADE AND EXECUTED ON THE FOLLOWING TERMS AND CONDITIONS.
BORROWER HAS RECEIVED PRIOR COMMERCIAL LOANS FROM LENDER OR HAS APPLIED TO
LENDER FOR A COMMERCIAL LOAN OR LOANS AND OTHER FINANCIAL ACCOMMODATIONS,
INCLUDING THOSE WHICH MAY BE DESCRIBED ON ANY EXHIBIT OR SCHEDULE ATTACHED TO
THIS AGREEMENT. ALL SUCH LOANS AND FINANCIAL ACCOMMODATIONS, TOGETHER WITH ALL
FUTURE LOANS AND FINANCIAL ACCOMMODATIONS FROM LENDER TO BORROWER, ARE REFERRED
TO IN THIS AGREEMENT INDIVIDUALLY AS THE "LOAN" AND COLLECTIVELY AS THE
"LOANS." BORROWER UNDERSTANDS AND AGREES THAT: (A) IN GRANTING, RENEWING, OR
EXTENDING ANY LOAN, LENDER IS RELYING UPON BORROWER'S REPRESENTATIONS,
WARRANTIES, AND AGREEMENTS, AS SET FORTH IN THIS AGREEMENT; (B) THE GRANTING,
RENEWING, OR EXTENDING OF ANY LOAN BY LENDER AT ALL TIMES SHALL BE SUBJECT TO
LENDER'S SOLE JUDGMENT AND DISCRETION; AND (C) ALL SUCH LOANS SHALL BE AND
SHALL REMAIN SUBJECT TO THE FOLLOWING TERMS AND CONDITIONS OF THIS AGREEMENT.

TERM. This Agreement shall be effective as of April 19, 1996, and shall
continue thereafter until all indebtedness of Borrower to Lender has been
performed in full and the parties terminate this Agreement in writing.

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

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

ACCOUNT. The word "Account" means a trade account, account receivable,
or other right to payment for goods sold or services rendered owing to
Borrower (or to a third party grantor acceptable to Lender).

ACCOUNT DEBTOR. The words "Account Debtor" mean the person or entity
obligated upon an Account.

ADVANCE. The word "Advance" means a disbursement of Loan funds under
this Agreement.

BORROWER. The word "Borrower" means BOYD'S WHEELS, INC. The word
"Borrower" also includes, as applicable, all subsidiaries and affiliates
of Borrower as provided below in the paragraph titled "Subsidiaries and
Affiliates."

BORROWING BASE. The words "Borrowing Base" mean, as determined by Lender
from time to time, the lesser of (a) $2,500,000.00; or (b) the sum of (i)
80.000% of the aggregate amount of Eligible Accounts, plus (ii) 40.000%
of the aggregate amount of Eligible Inventory (not to exceed
$1,000,000.00). Inventory advances shall not exceed advances against
Receivables.

BUSINESS DAY. The words "Business Day" mean a day on which commercial
banks are open for business in the State of California.

CERCLA. The word "CERCLA" means the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended.

CASH FLOW. The words "Cash Flow" mean net income after taxes, and
exclusive of extraordinary gains and income, plus depreciation and
amortization.

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

DEBT. The word "Debt" means all of Borrower's liabilities excluding
Subordinated Debt.

ELIGIBLE ACCOUNTS. The words "Eligible Accounts" mean, at any time, all
of Borrower's Accounts which contain selling terms and conditions
acceptable to Lender. The net amount of any Eligible Account against
which Borrower may borrow shall exclude all returns, discounts, credits,
and offsets of any nature. Unless otherwise agreed to by Lender in
writing, Eligible Accounts do not include:

(a) Accounts with respect to which the Account Debtor is an
officer, an employee or an agent of Borrower.

(b) Accounts with respect to which the Account Debtor is a
subsidiary of, or affiliated with or related to Borrower or its
shareholders, officers, or directors.

(c) Accounts with respect to which goods are placed on
consignment, guaranteed sale, or other terms by reason of which the
payment by the Account Debtor may be conditional.

(d) Accounts with respect to which the Account Debtor is not a
resident of the United States, except to the extent such Accounts
are supported by insurance, bonds or other assurances satisfactory
to Lender.

(e) Accounts with respect to which Borrower is or may become
liable to the Account Debtor for goods sold or services rendered by
the Account Debtor to Borrower.

(f) Accounts which are subject to dispute, counterclaim, or
setoff.

(g) Accounts with respect to which the goods have not been shipped
or delivered, or the services have not been rendered, to the Account
Debtor.

(h) Accounts with respect to which Lender, in its sole discretion,
deems the creditworthiness or financial condition of the Account
Debtor to be unsatisfactory.

(i) Accounts of any Account Debtor who has filed or has had filed
against it a petition in bankruptcy or an application for relief
under any provision of any state or federal bankruptcy, insolvency,
or debtor-in-relief acts; or who has had appointed a trustee,
custodian, or receiver for the assets of such Account Debtor; or who
has made an assignment for the benefit of creditors or has become
insolvent or fails generally to pay its debts (including its
payrolls) as such debts become due.

(j) Accounts with respect to which the Account Debtor is the
United States government or any department or agency of the United
States.

(k) Accounts which have not been paid in full within 90 days from
the invoice date. The entire balance of any Account of any single
Account Debtor will be ineligible whenever the portion of the
Account which has not been paid within 90 days from the invoice date
is in excess of 25.000% of the total amount outstanding on the
Account.

(l) That portion of the Accounts of any single Account Debtor
which exceeds 25.000% of all of Borrower's Accounts.

(m) Other Accounts deemed ineligible at Bank's discretion.
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04-19-1996 LOAN AGREEMENT PAGE 2
LOAN NO. 13482 (CONTINUED)
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* Item (d) above to include the exception that Canada is not
considered "Foreign" for the purpose of this Agreement.

** Item (f) above to include contra accounts.

*** Item (l) above to include the exception that, during the
period from November 1 through February 28, Trader Tim's and All
Star Tire to increase to 30.000%.

ELIGIBLE INVENTORY. The words "Eligible Inventory" mean, at any time, all of
Borrower's inventory as defined below except:

(a) Inventory which is not owned by Borrower free and clear of all
security interests, liens, encumbrances, and claims of third parties.

(b) Inventory which Lender, in its sole discretion, deems to be
obsolete, unsalable, damaged, defective, or unfit for further processing.

(d) Product packaging.

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

EVENT OF DEFAULT. The words "Event of Default" means and include without
limitation any of the Events of Default set forth below in the section
titled "EVENTS OF DEFAULT."

EXPIRATION DATE. The words "Expiration Date" mean the date of
termination of Lender's commitment to lend under this Agreement.

GRANTOR. The word "Grantor" means and includes without limitation each
and all of the persons or entities granting a Security Interest in any
Collateral for the indebtedness, including without limitation all
Borrowers granting such a Security Interest.

GUARANTOR. The word "Guarantor" means and includes without limitation
each and all of the guarantors, sureties, and accommodation parties in
connection with any indebtedness.

INDEBTEDNESS. The word "Indebtedness" means and includes without
limitation all Loans, together with all other obligations, debts and
liabilities of Borrower to Lender, or any one or more of them, as well as
all claims by Lender against Borrower, or any one or more of them;
whether now or hereafter existing, voluntary or involuntary, due or not
due, absolute or contingent, liquidated or unliquidated; whether Borrower
may be liable individually or jointly with others; whether Borrower may
be obligated as a guarantor, surety, or otherwise; whether recovery upon
such indebtedness may be or hereafter may become barred by any statute of
limitations; and whether such indebtedness may be or hereafter may become
otherwise unenforceable.

INVENTORY. The word "Inventory" means all of Borrower's raw materials,
work in process, finished goods, merchandise, parts and supplies, of
every kind and description, and goods held for sale or lease or furnished
under contracts of service in which Borrower now has or hereafter
acquires any right, whether held by Borrower or others, and all documents
of title, warehouse receipts, bills of lading, and all other documents of
every type covering all or any part of the foregoing. Inventory includes
inventory temporarily out of Borrower's custody or possession and all
returns on Accounts.

LENDER. The word "Lender" means ELDORADO BANK, its successors and
assigns.

LINE OF CREDIT. The words "Line of Credit" mean the credit facility
described in the Section titled "LINE OF CREDIT" below.

LIQUID ASSETS. The words "Liquid Assets" mean Borrower's cash on hand
plus Borrower's readily marketable securities.

LOAN. The word "Loan" or "Loans" means and includes without limitation
any and all commercial loans and financial accommodations from Lender to
Borrower, whether now or hereafter existing, and however evidenced,
including without limitation those loans and financial accommodations
described herein or described on any exhibit or schedule attached to this
Agreement from time to time.

NOTE. The word "Note" means and includes without limitation Borrowers'
promissory note or notes, if any, evidencing Borrower's Loan obligations
in favor of Lender, as well as any substitute, replacement or refinancing
note or notes therefor.

PERMITTED LIENS. The words "Permitted Liens" mean: (a) liens and
security interests securing indebtedness owed by Borrower to Lender; (b)
liens for taxes, assessments, or similar charges either not yet due or
being contested in good faith; (c) liens of materialmen, mechanics,
warehousemen, or carriers, or other like liens arising in the ordinary
course of business and securing obligations which are not yet delinquent;
(d) purchase money liens or purchase money security interests upon or in
any property acquired or held by Borrower in the ordinary course of
business to secure indebtedness outstanding on the date of this Agreement
or permitted to be incurred under the paragraph of this Agreement titled
"Indebtedness and Liens"; (e) liens and security interests which, as of
the date of this Agreement, have been disclosed to and approved by the
Lender in writing; and (f) those liens and security interests which in
the aggregate constitute an immaterial and insignificant monetary amount
with respect to the net value of Borrower's assets.

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

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

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

SARA. The word "SARA" means the Superfund Amendments and Reauthorization
Act of 1986 as now or hereafter amended.

SUBORDINATED DEBT. The words "Subordinated Debt" mean indebtedness and
liabilities of Borrower which have been subordinated by written agreement
to indebtedness owned by Borrower to Lender in form and substance
acceptable to Lender.

TANGIBLE NET WORTH. The words "Tangible Net Worth" mean Borrower's total
assets excluding all intangible assets (i.e., goodwill, trademarks,
patents, copyrights, organizational expenses, and similar intangible
items, but including leaseholds and leasehold improvements) less total
Debt.

WORKING CAPITAL. The words "Working Capital" mean Borrower's current
assets, excluding prepaid expenses, less Borrower's current liabilities.

LINE OF CREDIT. Lender agrees to make Advances to Borrower from time to time
from the date of this Agreement to the Expiration Date, provided the aggregate
amount of such Advances outstanding at any time does not exceed the Borrowing
Base. Within the foregoing limits, Borrower may borrow, partially or wholly
prepay, and reborrow under this Agreement as follows:

CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make any
Advance to or for the account of Borrower under this Agreement is subject
to the following conditions precedent, with all documents, instruments,
opinions, reports, and other items required under this Agreement to be in
form and substance satisfactory to Lender:

(a) Lender shall have received evidence that this Agreement and
all Related Documents have been duly authorized, executed, and
delivered by Borrower to Lender.

(b) Lender shall have received such opinions of counsel,
supplemental opinions, and documents as Lender may request.

(c) The security interests in the Collateral shall have been duly
authorized, created, and perfected with first lien priority and
shall be in full force and effect.

(d) All guaranties required by Lender for the Line of Credit shall
have been executed by each Guarantor, delivered to Lender, and be in
full force and effect.

(e) Lender, at its option and for its sole benefit, shall have
conducted an audit of Borrower's Accounts, inventory, books,
records, and operations, and Lender shall be satisfied as to their
condition.

(f) Borrower shall have paid to Lender all fees, costs, and
expenses specified in this Agreement and the Related Documents as
are then due and payable, including without limitation the following
loan fees: Loan Fee of $12,500.00.
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04-19-1996 LOAN AGREEMENT PAGE 3
LOAN NO. 13482 (CONTINUED)
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(g) There shall not exist at the time of any Advance a condition
which would constitute an Event of Default under this Agreement, and
Borrower shall have delivered to Lender the compliance certificate
called for in the paragraph below titled "Compliance Certificate."

MAKING LOAN ADVANCES. Advances under the Line of Credit may be requested
either orally or in writing subject to the limitations set forth below.
Lender may, but need not, require that all oral requests be confirmed in
writing. Each Advance shall be conclusively deemed to have been made at
the request of and for the benefit of Borrower (a) when credited to any
deposit account of Borrower maintained with Lender or (b) when advanced
in accordance with the instructions of an authorized person. Lender, at
its option, may set a cutoff time, after which all requests for Advances
will be treated as having been requested on the next succeeding Business
Day.

MANDATORY LOAN REPAYMENTS. If at any time the aggregate principal amount
of the outstanding Advances shall exceed the applicable Borrowing Base,
Borrower, immediately upon written or oral notice from Lender, shall pay
to Lender an amount equal to the difference between the outstanding
principal balance of the Advances and the Borrowing Base. On the
Expiration Date, Borrower shall pay to Lender in full the aggregate
unpaid principal amount of all Advances then outstanding and all accrued
unpaid interest, together with all other applicable fees, costs and
charges, if any, not yet paid.

LOAN ACCOUNT. Lender shall maintain on its books a record of account in
which Lender shall make entries for each Advance and such other debits
and credits as shall be appropriate in connection with the credit
facility. Lender shall provide Borrower with periodic statements of
Borrower's account, which statements shall be considered to be correct
and conclusively binding on Borrower unless Borrower notifies Lender to
the contrary within thirty (30) days after Borrower's receipt of any such
statement which Borrower deems to be incorrect.

COLLATERAL. To secure payment of the Line of Credit and performance of all
other Loans, obligations and duties owed by Borrower to Lender, Borrower (and
others, if required) shall grant to Lender Security Interests in such property
and assets as Lender may require (the "Collateral"), including without
limitation Borrower's present and future Accounts, general intangibles, and
inventory. Lender's Security Interests in the Collateral shall be continuing
liens and shall include the proceeds and products of the Collateral, including
without limitation the proceeds of any insurance. With respect to the
Collateral, Borrower agrees and represents and warrants to Lender:

PERFECTION OF SECURITY INTERESTS. Borrower agrees to execute such
financing statements and to take whatever other actions are requested by
Lender to perfect and continue Lender's Security Interests in the
Collateral. Upon request of Lender, Borrower will deliver to Lender any
and all of the documents evidencing or constituting the Collateral, and
Borrower will note Lender's interest upon any and all chattel paper if
not delivered to Lender for possession by Lender. Contemporaneous with
the execution of this Agreement, Borrower will execute one or more UCC
financing statements and any similar statements as may be required by
applicable law, and will file such financing statements and all such
similar statements in the appropriate location or locations. Borrower
hereby appoints Lender as its irrevocable attorney-in-fact for the
purpose of executing any documents necessary to perfect or to continue
any Security Interest. Lender may at any time, and without further
authorization from Borrower, file a carbon, photograph, facsimile, or
other reproduction of any financing statement for use as a financing
statement. Borrower will reimburse Lender for all expenses for the
perfection, termination, and the continuation of the perfection of
Lender's security interest in the Collateral. Borrower promptly will
notify Lender of any change in Borrower's name including any change to
the assumed business names of Borrower. Borrower also promptly will
notify Lender of any change in Borrower's Social Security Number or
Employer Identification Number. Borrower further agrees to notify Lender
in writing prior to any change in address or location of Borrower's
principal governance office or should Borrower merge or consolidate with
any other entity.

COLLATERAL RECORDS. Borrower does now, and at all times hereafter shall,
keep correct and accurate records of the Collateral, all of which records
shall be available to Lender or Lender's representative upon demand for
inspection and copying at any reasonable time. With respect to the
Accounts, Borrower agrees to keep and maintain such records as Lender may
require, including without limitation information concerning Eligible
Accounts and Account balances and agings. With respect to the Inventory,
Borrower agrees to keep and maintain such records as Lender may require,
including without limitation information concerning Eligible Inventory
and records itemizing and describing the kind, type, quality, and
quantity of Inventory, Borrower's Inventory costs and selling prices, and
the daily withdrawals and additions to Inventory. The following is an
accurate and complete list of all locations at which Borrower keeps or
maintains business records concerning Borrower's Accounts and Inventory:
8380 Cerritos Avenue, Stanton, Ca 90680, 8400 Cerritos Ave., Stanton, Ca
90680, 8402 Cerritos Ave., Stanton, Ca 90680, 8350 Cerritos Ave.,
Stanton, Ca 90680, 10541 Ashdale Street, Stanton, Ca 90680 and 8250
Cerritos Ave., Stanton, Ca 90680.

COLLATERAL SCHEDULES. Concurrently with the execution and delivery of
this Agreement, Borrower shall execute and deliver to Lender schedules of
Accounts and Inventory and Eligible Accounts and Eligible Inventory, in
form and substance satisfactory to the Lender. Thereafter Borrower shall
execute and deliver to Lender such supplemental schedules of Eligible
Accounts and Eligible Inventory and such other matters and information
relating to the Accounts and Inventory as Lender may request.
Supplemental schedules shall be delivered according to the following
schedules: Monthly Borrowing Base Certificates, Accounts Receivable and
Accounts Payables agings and Inventory certification due within 15 days
of month end.

REPRESENTATIONS AND WARRANTIES CONCERNING ACCOUNTS. With respect to the
Accounts, Borrower represents and warrants to Lender: (a) Each Account
represented by Borrower to be an Eligible Account for purposes of this
Agreement conforms to the requirements of the definition of an Eligible
Account; (b) All Account information listed on schedules delivered to
Lender will be true and correct, subject to immaterial variance; and (c)
Lender, its assigns, or agents shall have the right at any time and at
Borrower's expense to inspect, examine, and audit Borrowers' records and
to confirm with Account Debtors the accuracy of such Accounts.

REPRESENTATIONS AND WARRANTIES CONCERNING INVENTORY. With respect to the
Inventory, Borrower represents and warrants to Lender: (a) All Inventory
represented by Borrower to be Eligible Inventory for purposes of this
Agreement conforms to the requirements of the definition of Eligible
Inventory; (b) All Inventory values listed on schedules delivered to
Lender will be true and correct, subject to immaterial variance; (c) The
value of the Inventory will be determined on a consistent accounting
basis; (d) Except as agreed to the contrary by Lender in writing, all
Eligible Inventory is now and at all times hereafter will be Borrower's
physical possession and shall not be held by others on consignment, sale
on approval, or sale or return; (e) Except as reflected in the Inventory
schedules delivered to Lender, all Eligible Inventory is now and at all
times hereafter will be of good and merchantable quality, free from
defects; (f) Eligible Inventory is not now and will not at any time
hereafter be stored with a bailee, warehouseman, or similar party without
Lender's prior written consent, and, in such event, Borrower will
concurrently at the time of bailment cause any such bailee, warehouseman,
or similar party to issue and deliver to Lender, in form acceptable to
Lender, warehouse receipts in Lender's name evidencing the storage of
Inventory; and (g) Lender, its assigns, or agents shall have the right at
any time and at Borrower's expense to inspect and examine the Inventory
and to check and test the same as to quality, quantity, value, and
condition.

ADDITIONAL CREDIT FACILITIES. In addition to the Line of Credit facility, the
following credit accommodations are either in place or will be made available
to Borrower:

OTHER FACILITY. Subject to the terms and conditions of this Agreement,
the following described credit facility is either in place or will be
made available to Borrower:

Non-revolving equipment loan - Note #13678 in the amount of
$1,000,000.000 at a rate of Wall Street Journal Prime plus 1.50% due to
be termed out over 60 months (fully amortized - principal plus interest)
on May 1, 1997. Advances for new equipment purchased limited to 80.0% of
total invoice cost with security agreements to be executed with each
advance.

Term loan - Note #13483 in the amount of $599,874.42.

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

ORGANIZATION. Borrower is a corporation which is duly organized, validly
existing, and in good standing under the laws of the State of California
and is validly existing and in good standing in all states in which
Borrower is doing business. Borrower has the full power and authority to
own its properties and to transact the businesses in which it is
presently engaged or presently proposes to engage. Borrower also is duly
qualified as a foreign corporation and is in good standing in all states
in which the failure to so qualify would have a material adverse effect
on its businesses or financial condition.

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

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

LEGAL EFFECT. This Agreement constitutes, and any instrument or
agreement required hereunder to be given by Borrower when delivered will
constitute, legal, valid and binding obligations of Borrower enforceable
against Borrower in accordance with their respective terms.
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PROPERTIES. Except for Permitted Liens, Borrower owns and has good title
to all of Borrower's properties free and clear of all Security Interests,
and has not executed any security documents or financing statements
relating to such properties. All of Borrower's properties are titled in
Borrower's legal name, and Borrower had not used, or filed a financing
statement under, any other name for at least the last five (5) years.

HAZARDOUS SUBSTANCES. The terms "hazardous waste," "hazardous
substance," "disposal," "release," and "threatened release," as used in
this Agreement, shall have the same meanings as set forth in the
"CERCLA," "SARA," the Hazardous Materials Transportation Act, 49 U.S.C.
Section 1801, et seq., the Resource Conservation and Recovery Act, 42
U.S.C. Section 6901, et seq., Chapters 6.5 through 7.7 of Division 20 of
the California Health and Safety Code, Section 25100, et seq., or other
applicable state or Federal laws, rules, or regulations adopted pursuant
to any of the foregoing. Except as disclosed to and acknowledged by
Lender in writing, Borrower represents and warrants that: (a) During the
period of Borrower's ownership of the properties, there has been no use,
generation, manufacture, storage, treatment, disposal, release or
threatened release of any hazardous waste or substance by any person on,
under, about or from any of the properties. (b) Borrower has no
knowledge of, or reason to believe that there has been (i) any use,
generation, manufacture, storage, treatment, disposal, release, or
threatened release of any hazardous waste or substance on, under, about
or from the properties by any prior owners or occupants of any of the
properties, or (ii) any actual or threatened litigation or claims of any
kind by any person relating to such matters. (c) Neither Borrower nor
any tenant, contractor, agent or other authorized user of any of the
properties shall use, generate, manufacture, store, treat, dispose of, or
release any hazardous waste or substance on, under, about or from any of
the properties; and any such activity shall be conducted in compliance
with all applicable federal, state, and local laws, regulations, and
ordinances, including without limitation those laws, regulations and
ordinances described above. Borrower authorizes Lender and its agents to
enter upon the properties to make such inspections and tests as Lender
may deem appropriate to determine compliance of the properties with this
section of the Agreement. Any inspections or tests made by Lender shall
be at Borrower's expense and for Lender's purposes only and shall not be
construed to create any responsibility or liability on the part of Lender
to Borrower or to any other person. The representations and warranties
contained herein are based on Borrower's due diligence in investing at
the properties for hazardous waste and hazardous substances. Borrower
hereby (a) releases and waives any future claims against Lender for
indemnity or contribution in the event Borrower becomes liable for
cleanup or other costs under any such laws, and (b) agrees to indemnify
and hold harmless Lender against any and all claims, losses, liabilities,
damages, penalties, and expenses which Lender may directly or indirectly
sustain or suffer resulting from a breach of this section of the
Agreement or as a consequence of any use, generation, manufacture,
storage, disposal, release or threatened release occurring prior to
Borrower's ownership or interest in the properties, whether or not the
same was or should have been known to Borrower. The provisions of this
section of the Agreement, including the obligation to indemnify, shall
survive the payment of the indebtedness and the termination or expiration
of this Agreement and shall not be affected by Lender's acquisition of
any interest in any of the properties, whether by foreclosure or
otherwise.

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

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

LIEN PRIORITY. Unless otherwise previously disclosed to Lender in
writing, Borrower has not entered into or granted any Security
Agreements, or permitted the filing or attachment of any Security
Interests on or affecting any of the Collateral directly or indirectly
securing repayment of Borrower's Loan and Note, that would be prior or
that may in any way be superior to Lender's Security Interests and rights
in and to such Collateral.

BINDING EFFECT. This Agreement, the Note, all Security Agreements
directly or indirectly securing repayment of Borrower's Loan and Note and
all of the Related Documents are binding upon Borrower as well as upon
Borrower's successors, representatives and assigns, and are legally
enforceable in accordance with their respective terms.

COMMERCIAL PURPOSES. Borrower intends to use the Loan proceeds solely
for business or commercial related purposes.

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

LOCATION OF BORROWER'S OFFICES AND RECORDS. Borrower's place of
business, or Borrower's Chief executive office, if Borrower has more than
one place of business, is located at 8380 CERRITOS AVENUE, STANTON, CA
90680. Unless Borrower has designated otherwise in writing this location
is also the office or offices where Borrower keeps its records concerning
the Collateral.

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

SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Borrower understands and
agrees that Lender, without independent investigation, is relying upon
the above representations and warranties in extending Loan Advances to
Borrower. Borrower further agrees that the foregoing representations and
warranties shall be continuing in nature and shall remain in full force
and effect until such time as Borrower's indebtedness shall be paid in
full, or until this Agreement shall be terminated in the manner provided
above, whichever is the last to occur.

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

LITIGATION. Promptly inform Lender in writing of (a) all material
adverse changes in Borrower's financial condition, and (b) all existing
and all threatened litigation, claims, investigations, administrative
proceedings or similar actions affecting Borrower or any Guarantor which
could materially affect the financial condition of Borrower or the
financial condition of any Guarantor.

FINANCIAL RECORDS. Maintain its books and records in accordance with
generally accepted accounting principles, applied on a consistent basis,
and permit Lender to examine and audit Borrower's books and records at
all reasonable times.

FINANCIAL STATEMENTS. Furnish Lender with, as soon as available, but in
no event later than ninety (90) days after the end of each fiscal year,
Borrower's balance sheet and income statement for the year ended, audited
by a certified public accountant satisfactory to Lender. All financial
reports required to be provided under this Agreement shall be prepared in
accordance with generally accepted accounting principles, applied on a
consistent basis, and certified by Borrower as being true and correct.

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

FINANCIAL COVENANTS AND RATIOS. Comply with the following covenants and
ratios:

TANGIBLE NET WORTH. Maintain a minimum Tangible Net Worth of not less
than $5,000,000.00.

NET WORTH RATIO. Maintain a ratio of Total Liabilities to Tangible Net
Worth of less than 1.50 to 1.00.

CURRENT RATIO. Maintain a ratio of Current Assets to Current Liabilities
in excess of 1.40 to 1.00.

The following provisions shall apply for purposes of determining
compliance with the foregoing financial covenants and ratios: FINANCIAL
COVENANTS AND RATIOS TO BE MEASURED QUARTERLY. Except as provided above,
all computations made to determine compliance with the requirements
contained in this paragraph shall be made in accordance with generally
accepted accounting principles, applied on a consistent basis, and
certified by Borrower as being true and correct.

INSURANCE. Maintain fire and other risk insurance, public liability
insurance, and such other insurance as Lender may require with respect to
Borrower's properties and operations, in form, amounts, coverages and
with insurance companies reasonably acceptable to Lender. Borrower, upon
request of Lender, will deliver to Lender from time to time the policies
or certificates of insurance in form satisfactory to Lender, including
stipulations that coverages will not be cancelled or diminished without
at least ten (10) days' prior written notice to Lender. Each insurance
policy also shall include an endorsement providing
that coverage in favor of Lender will not be impaired in any way by any
act, omission or default of Borrower or any other person. In connection
with all policies covering assets in which Lender holds or is offered a
security interest for the Loans, Borrower will provide Lender with such
loss payable or other endorsements as Lender may require.

OTHER AGREEMENTS. Comply with all terms and conditions of all other
agreements, whether now or hereafter existing, between Borrower and any
other party and notify Lender immediately in writing of any default in
connection with any other such agreements.
5
04-19-1996 LOAN AGREEMENT PAGE 5
LOAN NO. 13482 (CONTINUED)
================================================================================

LOAN FEES AND CHARGES. In addition to all other agreed upon fees and
charges, pay the following: LOAN FEE OF $12,500.00.

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

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

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

OPERATIONS. Maintain executive and management personnel with
substantially the same qualifications and experience as the present
executive and management personnel; provide written notice to Lender of
any change in executive and management personnel; conduct its business
affairs in a reasonable and prudent manner and in compliance with all
applicable federal, state and municipal laws, ordinances, rules and
regulations respecting its properties, charters, businesses and
operations, including without limitation, compliance with the Americans
With Disabilities Act and with all minimum funding standards and other
requirements of ERISA and other laws applicable to Borrower's employee
benefit plans.

INSPECTION. Permit employees or agents of Lender at any reasonable time
to inspect any and all Collateral for the Loan or Loans and Borrower's
other properties and to examine or audit Borrower's books, accounts, and
records and to make copies and memoranda of Borrower's books, accounts,
and records. If Borrower now or at any time hereafter maintains any
records (including without limitation computer generated records and
computer software programs for the generation of such records) in the
possession of a third party, Borrower, upon request of Lender, shall
notify such party to permit Lender free access to such records at all
reasonable times and to provide Lender with copies of any records it may
request, all at Borrower's expense.

COMPLIANCE CERTIFICATE. Unless waived in writing by Lender, provide
Lender at least annually and at the time of each disbursement of Loan
proceeds with a certificate executed by Borrower's chief financial
officer, or other officer or person acceptable to Lender, certifying that
the representations and warranties set forth in this Agreement are true
and correct as of the date of the certificate and further certifying
that, as of the date of the certificate, no Event of Default exists under
this Agreement.

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

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

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

INDEBTEDNESS AND LIENS. (a) Except for trade debt incurred in the normal
course of business and indebtedness to Lender contemplated by this
Agreement, create, incur or assume indebtedness for borrowed money,
including capital leases, (b) except as allowed as a Permitted Lien,
sell, transfer, mortgage, assign, pledge, lease, grant a security
interest in, or encumber any of Borrower's assets, or (c) sell with
recourse any of Borrower's accounts, except to Lender.

CONTINUITY OF OPERATIONS. (a) Engage in any business activities
substantially different than those in which Borrower is presently
engaged, (b) cease operations, liquidate, merge, transfer, acquire or
consolidate with any other entity, change ownership, change its name,
dissolve or transfer or sell Collateral out of the ordinary course of
business, (c) pay any dividends on Borrower's stock (other than dividends
payable in its stock), provided, however that notwithstanding the
foregoing, but only so long as no Event of Default has occurred and is
continuing or would result from the payment of dividends, if Borrower is
a "Subchapter S Corporation" (as defined in the Internal Revenue Code of
1986, as amended), Borrower may pay cash dividends on its stock to its
shareholders from time to time in amounts necessary to enable the
shareholders to pay income taxes and made estimated income tax payments
to satisfy their liabilities under federal and state law which arise
solely from their status as Shareholders of a Subchapter S Corporation
because of their ownership of shares of stock of Borrower, or (d)
purchase or retire any of Borrower's outstanding shares or alter or amend
Borrower's capital structure.

LOANS, ACQUISITIONS AND GUARANTIES. (a) Loan, invest in or advance money
or assets, (b) purchase, create or acquire any interest in any other
enterprise or entity, or (c) incur any obligation as surety or guarantor
other than in the ordinary course of business.

CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to
Borrower, whether under this Agreement or under any other agreement, Lender
shall have no obligation to make Loan Advances or to disburse Loan proceeds if:
(a) Borrower or any Guarantor is in default under the terms of this Agreement
or any of the Related Documents or any other agreement that Borrower or any
Guarantor has with Lender; (b) Borrower or any Guarantor becomes insolvent,
files a petition in bankruptcy or similar proceedings, or is adjudged a
bankrupt; (c) there occurs a material adverse change in Borrower's financial
condition, in the financial condition of any Guarantor, or in the value of any
Collateral securing any Loan; or (d) any Guarantor seeks, claims or otherwise
attempts to limit, modify or revoke such Guarantor's guaranty of the Loan or
any other loan with Lender.

ADDITIONAL CONDITIONS.

1. Two Accounts Receivable and Inventory Audits to be performed per line
year by auditor to be selected by Bank with results satisfactory to Bank.
Costs of audits not to exceed $1,000,000.00 to be paid by Borrower.

2. Borrower to provide quarterly financial statement and 10Q report within 45
days after quarter end.

3. Borrower to provide federal tax return within 15 days of filing.

4. No further advances to affiliates beyond the $195,000.00 as shown on the
9/30/95 financial statement without prior written consent of Bank.

RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory security
interest in, and hereby assigns, conveys, delivers, pledges, and transfers to
Lender all Borrower's right, title and interest in and to, Borrower's accounts
with Lender (whether checking, savings, or some other account), including
without limitation all accounts held jointly with someone else and all accounts
Borrower may open in the future, excluding however all IRA and Keogh accounts,
and all trust accounts for which the grant of a security interest would be
prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing in the indebtedness against
any and all such accounts.

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

DEFAULT ON INDEBTEDNESS. Failure of Borrower to make any payment when
due on the Loans.

OTHER DEFAULTS. Failure of Borrower or any Grantor to comply with or to
perform when due any other term, obligation, covenant or condition
contained in this Agreement or in any of the Related Documents, or
failure of Borrower to comply with or to perform any other term,
obligation, covenant or condition contained in any other agreement
between Lender and Borrower.

DEFAULT IN FAVOR OF THIRD PARTIES. Should Borrower or any Grantor
default under any loan, extension of credit, security agreement, purchase
or sales agreement, or any other agreement, in favor of any other
creditor or person that may materially affect any of Borrower's property
or Borrower's or any Grantor's ability to repay the Loans or perform
their respective obligations under this Agreement or any of the Related
Documents.

FALSE STATEMENTS. Any warranty, representation or statement made or
furnished to Lender by or on behalf of Borrower or any Grantor under this
Agreement or the Related Documents is false or misleading in any material
respect at the time made or furnished, or becomes false or misleading at
any time thereafter.
6
04-19-1996 LOAN AGREEMENT PAGE 6
LOAN NO. 13482 (CONTINUED)
================================================================================

DEFECTIVE COLLATERALIZATION. This Agreement or any of the Related
Documents ceases to be in full force and effect (including failure of any
Security Agreement to create a valid and perfected Security Interest) at
any time and for any reason.

INSOLVENCY. The dissolution or termination of Borrower's existence as a
going business, the insolvency of Borrower, the appointment of a receiver
for any part of Borrower's property, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any
proceeding under any bankruptcy or insolvency laws by or against
Borrower.

CREDITOR OR FORFEITURE PROCEEDINGS. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower, any
creditor of any Grantor against any collateral securing the indebtedness,
or by any governmental agency. This includes a garnishment, attachment,
or levy on or of any of Borrower's deposit accounts with Lender.

EVENTS AFFECTING GUARANTOR. Any of the preceding events occurs with
respect to any Guarantor of any of the indebtedness or any Guarantor dies
or becomes incompetent, or revokes or disputes the validity of, or
liability under, any Guaranty of the indebtedness.

CHANGE IN OWNERSHIP. Any change in ownership of twenty-five percent
(25%) or more of the common stock of Borrower.

ADVERSE CHANGE. A material adverse change occurs in Borrower's financial
condition, or Lender believes the prospect of payment or performance of
the indebtedness is impaired.

EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except
where otherwise provided in this Agreement or the Related Documents, all
commitments and obligations of Lender under this Agreement or the Related
Documents or any other agreement immediately will terminate (including any
obligation to make Loan Advances or disbursements), and, at Lender's option,
all indebtedness immediately will become due and payable, all without notice of
any kind to Borrower, except that in the case of an Event of Default of the
type described in the "insolvency" subsection above, such acceleration shall be
automatic and not optional. In addition, Lender shall have all the rights and
remedies provided in the Related Documents or available at law, in equity, or
otherwise. Except as may be prohibited by applicable law, all of Lender's
rights and remedies shall be cumulative and may be exercised singularly or
concurrently. Election by Lender to pursue any remedy shall not exclude
pursuit of any other remedy, and an election to make expenditures or to take
action to perform an obligation of Borrower or of any Grantor shall not affect
Lender's right to declare a default and to exercise its rights and remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement.

APPLICABLE LAW. This Agreement has been delivered to Lender and accepted
by Lender in the State of California. If there is a lawsuit, Borrower
agrees upon Lender's request to submit to the jurisdiction of the courts
of ORANGE County, the State of California. This Agreement shall be
governed by and construed in accordance with the laws of the State of
California.

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

MULTIPLE PARTIES; CORPORATE AUTHORITY. All obligations of Borrower under
this Agreement shall be joint and several, and all references to Borrower
shall mean each and every Borrower. This means that each of the
Borrowers signing below is responsible for all obligations in this
Agreement.

CONSENT TO LOAN PARTICIPATION. Borrower agrees and consents to Lender's
sale or transfer, whether now or later, of one or more participation
interests in the Loans to one or more purchases, whether related or
unrelated to Lender. Lender may provide, without any limitation
whatsoever, to any one or more purchases, or potential purchasers, any
information or knowledge Lender may have about Borrower or about any
other matter relating to the Loan, and Borrower hereby waives any rights
to privacy it may have with respect to such matters. Borrower also
agrees that the purchasers of any such participation interests will be
considered as the absolute owners of such interests in the Loans and will
have all the rights granted under the participation agreement or
agreements governing the sale of such participation interests. Borrower
further waives all rights of offset or counterclaim that it may have now
or later against Lender or against any purchase of such a participation
interest and unconditionally agrees that either Lender or such purchaser
may enforce Borrower's obligation under the Loans irrespective of the
failure or insolvency of any holder of any interest in the Loans.
Borrower further agrees that the purchaser of any such participation
interests may enforce its interests irrespective of any personal claims
or defenses that Borrower may have against Lender.

COSTS AND EXPENSES. Borrower agrees to pay upon demand all of Lender's
expenses, including without limitation attorneys' fees, incurred in
connection with the preparation, execution, enforcement, modification and
collection of this Agreement or in connection with the Loans made
pursuant to this Agreement. Lender may pay someone else to help collect
the Loans and to enforce this Agreement, and Borrower will pay that
amount. This includes, subject to any limits under applicable law,
Lender's attorneys' fees and Lender's legal expenses, whether or not
there is a lawsuit, including attorneys' fees for bankruptcy proceedings
(including efforts to modify or vacate any automatic stay or injunction),
appeals, and any anticipated post-judgment collection services. Borrower
also will pay any court costs, in addition to all other sums provided by
law.

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

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

SUBSIDIARIES AND AFFILIATES OF BORROWER. To the extent the context of
any provisions of this Agreement makes it appropriate, including without
limitation any representation, warranty or covenant, the word "Borrower"
as used herein shall include all subsidiaries and affiliates of Borrower.
Notwithstanding the foregoing however, under no circumstances shall this
Agreement be construed to require Lender to make any Loan or other
financial accommodation to any subsidiary or affiliate of Borrower.

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

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

TIME IS OF THE ESSENCE. Time is of the essence in the performance of
this Agreement.

WAIVER. Lender shall not be deemed to have waived any rights under this
Agreement unless such waiver is given in writing and signed by Lender.
No delay or omission on the part of Lender is exercising any right shall
operate as a waiver of such right or any other right. A waiver by Lender
of a provision of this Agreement shall not prejudice or constitute a
waiver of Lender's right otherwise to demand strict compliance with that
provision or any other provision of this Agreement. No prior waiver by
Lender, nor any course of dealing between Lender and Borrower, or between
Lender and any Grantor, shall constitute a waiver of any of Lender's
rights or of any obligations of Borrower or of any Grantor as to any
future transactions. Whenever the consent of Lender is required under
this Agreement, the granting of such consent by Lender in any instance
shall not constitute continuing consent in subsequent instances where
such consent is required, and in all cases such consent may be granted or
withheld in the sole discretion of Lender.

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS LOAN AGREEMENT,
AND BORROWER AGREES TO ITS TERMS. THIS AGREEMENT IS DATED APRIL 19, 1996.

BORROWER:

BOYD'S WHEELS, INC.

BY:
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO
7
04-19-1996 LOAN AGREEMENT PAGE 7
LOAN NO. 13482 (CONTINUED)
================================================================================

LENDER:

ELDORADO BANK

BY:
-------------------------------
AUTHORIZED OFFICER

================================================================================
VARIABLE RATE. LINE OF CREDIT

LASER PRO, REG. U.S. PAT. & T.M. OFF., VER. 3.21 (C) 1996 CFI PROSERVICES, INC.
ALL RIGHTS RESERVED. [CA-D20 E3.20 41 BOYDS.LN C2.OVL]
8
[ELDORADO BANK LOGO]

PROMISSORY NOTE

$2,500,000.00 04-19-1996 05-01-1997 13482 511 055 104121 GG1
- ----------------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE
APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR
- ----------------------------------------------------------------------------------------------------------------------------

BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17752 E. 17TH STREET
TUSTIN, CA 92680
================================================================================
PRINCIPAL AMOUNT: $2,500,000.00

INITIAL RATE: 9.250%

DATE OF NOTE: APRIL 19, 1996

PROMISE TO PAY. BOYD'S WHEELS, INC. ("Borrower") promises to pay to ELDORADO
BANK ("Lender"), or order, in lawful money of the United States of America, the
principal amount of Two Million Five Hundred Thousand & 00/100 Dollars
($2,500,000.00) or so much as may be outstanding, together with interest on the
unpaid outstanding principal balance of each advance. Interest shall be
calculated from the date of each advance until repayment of each advance.

PAYMENT. Borrower will pay this loan on demand, or if no demand is made, in
one payment of all outstanding principal plus all accrued unpaid interest on
May 1, 1997. In addition, Borrower will pay regular monthly payments of
accrued unpaid interest beginning June 1, 1996, and all subsequent interest
payments are due on the same day of each month after that. Interest on this
Note is computed on a 365/360 simple interest basis; that is, by applying the
ratio of the annual interest rate over a year of 360 days, multiplied by the
outstanding principal balance, multiplied by the actual number of days the
principal is outstanding. Borrower will pay Lender at Lender's address shown
above or at such other place as Lender may designate in writing. Unless
otherwise agreed or required by applicable law, payments will be applied first
to accrued unpaid interest, then to principal, and any remaining amount to any
unpaid collection costs and late charges.

VARIABLE INTEREST RATE. The interest rate on this Note is subject to change
from time to time based on changes in an independent index which is the WALL
STREET JOURNAL PRIME RATE (the "INDEX"). The index is not necessarily the
lowest rate charged by Lender on its loans. If the Index becomes unavailable
during the term of this loan, Lender may designate a substitute index after
notice to Borrower. Lender will tell Borrower the current Index rate upon
Borrower's request. Borrower understands that Lender may make loans based on
other rates as well. The interest rate change will not occur more often than
each DAY. THE INDEX CURRENTLY IS 8.250% PER ANNUM. THE INTEREST RATE TO BE
APPLIED TO THE UNPAID PRINCIPAL BALANCE OF THIS NOTE WILL BE AT A RATE OF 1.000
PERCENTAGE POINT OVER THE INDEX, RESULTING IN AN INITIAL RATE OF 9.250% PER
ANNUM. NOTICE: Under no circumstances will the interest rate on this Note be
more than the maximum rate allowed by applicable law.

PREPAYMENT; MINIMUM INTEREST CHARGE. In any event, even upon full prepayment
of this Note, Borrower understands that Lender is entitled to A MINIMUM
INTEREST CHARGE OF $100.00. Other than Borrower's obligation to pay any
minimum interest charge, Borrower may pay without penalty all or a portion of
the amount owed earlier than it is due. Early payments will not, unless agreed
to by Lender in writing, relieve Borrower of Borrower's obligation to continue
to make payments of accrued unpaid interest. Rather, they will reduce the
principal balance due.

LATE CHARGE. If a payment is 10 DAYS OR MORE LATE, Borrower will be charged
5.000% OF THE REGULARLY SCHEDULED PAYMENT OR $10.00, WHICHEVER IS GREATER.

DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform
when due any other term, obligation, covenant, or condition contained in this
Note or any agreement related to this Note, or in any other agreement or Loan
Borrower has with Lender. (c) Borrower defaults under any loan, extension of
credit, security agreement, purchase or sales agreement, or any other
agreement, in favor of any other creditor or person that may materially affect
any of Borrower's property or Borrower's ability to repay this Note or perform
Borrower's obligations under this Note or any of the Related Documents. (d)
Any representation or statement made or furnished to Lender by Borrower or on
Borrower's behalf is false or misleading in any material respect either now or
at the time made or furnished. (e) Borrower becomes insolvent, a receiver is
appointed for any part of Borrower's property, Borrower makes an assignment for
the benefit of creditors, or any proceeding is commenced either by Borrower or
against Borrower under any bankruptcy or insolvency laws. (f) Any creditor
tries to take any of Borrower's property on or in which Lender has a lien or
security interest. This includes a garnishment of any of Borrower's accounts
with Lender. (g) Any guarantor dies or any of the other events described in
this default section occurs with respect to any guarantor of this Note. (h) A
material adverse change occurs in Borrower's financial condition, or Lender
believes the prospect of payment or performance of the indebtedness is
impaired.

LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid balance on
this Note and all accrued unpaid interest immediately due, with notice, and
then Borrower will pay that amount. Upon Borrower's failure to pay all amounts
declared due pursuant to this section, including failure to pay upon final
maturity, Lender, at its option, may also, if permitted under applicable law,
increase the variable interest rate on this Note to 6.000 percentage points
over the Index. Lender may hire or pay someone else to help collect this Note
if Borrower does not pay. Borrower also will pay Lender that amount. This
includes, subject to any limits under applicable law, Lender's attorneys' fees
and Lender's legal expenses whether or not there is a lawsuit, including
attorneys' fees and legal expenses for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay or injunction), appeals, and any
anticipated post-judgment collection services. Borrower also will pay any
court costs in addition to all other sums provided by law. THIS NOTE HAS BEEN
DELIVERED TO LENDER AND ACCEPTED BY LENDER IN THE STATE OF CALIFORNIA. IF
THERE IS A LAWSUIT, BORROWER AGREES UPON LENDER'S REQUEST TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF ORANGE COUNTY, THE STATE OF CALIFORNIA. THIS
NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF CALIFORNIA.

RIGHT OF SETOFF. Borrower grants to Lender a contractual promissory security
interest in, and hereby assigns, conveys, delivers, pledges, and transfers to
Lender all Borrower's right, title and interest in and to, Borrower's accounts
with Lender (whether checking, savings, or some other account), including
without limitation all accounts held jointly with someone else and all accounts
Borrower may open in the future, excluding however all IRA and Keogh accounts,
and all trust accounts for which the grant of a security interest would be
prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on this Note against any and
all such accounts.

COLLATERAL. This Note is secured by a Security Agreement dated April 19, 1996.

LINE OF CREDIT. This Note evidences a revolving line of credit. Advances
under this Note may be requested either orally or in writing by Borrower or as
provided in this paragraph. Lender may, but need not, require that all oral
requests be confirmed in writing. All communications, instructions, or
directions by telephone or otherwise to lender are to be directed to lender's
office shown above. The following party or parties are authorized to request
advances under the line of credit until Lender receives from Borrower at
Lender's address shwon above written notice of revocation of their authority:
STAN CLARK OR BOYD CODDINGTON. Borrower agrees to be liable for all sums
either: (a) advanced in
9
04-19-1996 PROMISSORY NOTE PAGE 2
LOAN NO. 13482 (CONTINUED)
================================================================================

accordance with the instructions of an authorized person or (b) credited to any
of Borrower's accounts with Lender. The unpaid principal owing on this Note at
any time may be evidenced the endorsements on this Note or by Lender's internal
records, including daily computer print-outs. Lender will have no obligation
to advance funds under this Note if: (a) Borrower or any guarantor is in
default under the terms of this Note or any agreement that Borrower or any
guarantor has with Lender, including any agreement made in connection with the
signing of this Note; (b) Borrower or any guarantor ceases doing business or is
insolvent; (c) any guarantor seeks, claims or otherwise attempts to limit,
modify or revoke such guarantor's guarantee of this Note or any other loan with
Lender; or (d) Borrower has applied funds provided pursuant to this Note for
purposes other than those authorized by Lender.

GENERAL PROVISIONS. This Note is payable on demand. The inclusion of specific
default provisions or rights of Lender shall not preclude Lender's right to
declare payment of this Note on its demand. Lender may delay or forgo
enforcing any of its rights or remedies under this Note without losing them.
Borrower and any other person who signs, guarantees or endorses this Note, to
the extent allowed by law, waive any applicable statute of limitations,
presentment, demand for payment, protest and notice of debtor. Upon any change
in the terms of this Note, and unless otherwise expressly stated in writing, no
party who signs this Note, whether as maker, guarantor, accommodation, maker or
endorser, shall be released from liability. All such parties agree that Lender
may renew or extend (repeatedly and for any length of time) this loan, or
release any party or guarantor or collateral; or impair, fail to realize upon
or perfect Lender's security interest in the collateral; and take any other
action deemed necessary by Lender without the consent of or notice to anyone.
All such parties also agree that Lender may modify this loan without the
consent of or notice to anyone other than the party with whom the modification
is made.

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO
THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THE NOTE.

BORROWER:

BOYD'S WHEELS, INC.

By: /s/ BOYD CODDINGTON
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

================================================================================
VARIABLE RATE. LINE OF CREDIT

LASER PRO, REG. U.S. PAT. & T.M. OFF., VER. 3.21 (C) 1996 CFI PROSERVICES, INC.
ALL RIGHTS RESERVED. [CA-D20 E3.20 41 BOYDS.LN C2.OVL]
10
AGREEMENT TO PROVIDE INSURANCE

INSURANCE REQUIREMENTS. BOYD'S WHEELS, INC. ("Grantor") understands that
insurance coverage is required in connection with the extending of a loan or
the providing of other financial accommodations to Grantor by Lender. these
requirements are set forth in the security documents. The following minimum
insurance coverages must be provided on the following described collateral (the
"Collateral"):

COLLATERAL: ALL INVENTORY, INCLUDING AS SECURITY FOR ALL PRESENTLY EXISTING OR
HEREAFTER ARISING OBLIGATIONS OF DEBTOR TO OR TO SECURED PARTY,
DEBTOR HEREBY GRANTS TO SECURED PARTY A SECURITY INTEREST IN: ALL
PROPERTY IN WHICH A SECURITY INTEREST CAN BE GRANTED PURSUANT TO
THE CALIFORNIA COMMERCIAL CODE, WHICH PROPERTY INCLUDES, BUT IS
NOT LIMITED TO, ALL PRESENTLY OR HEREAFTER ARISING, NOW OWNED OR
HEREAFTER ACQUIRED INVENTORY, EQUIPMENT, ACCOUNTS, CONTRACT
RIGHTS, CHATTEL PAPER, DOCUMENTS, INSTRUMENTS, GOODS, GENERAL
INTANGIBLES, DEPOSIT ACCOUNTS AND MONEY.
TYPE. All risks, including fire, theft and liability.
AMOUNT. $2,500,000.00.
BASIS. Replacement value.
ENDORSEMENTS. Lender's loss payable clause with stipulation that
coverage will not be cancelled or diminished without a minimum of
ten (10) days' prior written notice to lender.
DEDUCTIBLES. $1,000.00.

INSURANCE COMPANY. Grantor may obtain insurance from any insurance company
Grantor may choose that is reasonably acceptable to Lender. Grantor
understands that credit may not be denied solely because insurance was not
purchased through Lender.

INSURANCE MAILING ADDRESS. All documents and other materials relating to
insurance for this loan should be mailed, delivered or directed to the
following address:

ELDORADO BANK
CENTRAL NOTE DEPARTMENT
P.O. BOX 15510
IRVINE, CA 92715
(714) 798-1100

FAILURE TO PROVIDE INSURANCE. Grantor agrees to deliver to Lender, ten (10)
days from the date of this Agreement, evidence of the required insurance as
provided above, with an effective date of April 19, 1996, or earlier. Grantor
acknowledges and agrees that if Grantor fails to provide any required insurance
or fails to continue such insurance in force, Lender may do so at Grantor's
expenses as provided in the applicable security document. GRANTOR ACKNOWLEDGES
THAT IF LENDER SO PURCHASES ANY SUCH INSURANCE, THE INSURANCE WILL PROVIDE
LIMITED PROTECTION AGAINST PHYSICAL DAMAGE TO THE COLLATERAL, UP TO THE BALANCE
OF THE LOAN; HOWEVER, GRANTOR'S EQUITY IN THE COLLATERAL MAY NOT BE INSURED.
IN ADDITION, THE INSURANCE MAY NOT PROVIDE ANY PUBLIC LIABILITY OR PROPERTY
DAMAGE INDEMNIFICATION AND MAY NOT MEET THE REQUIREMENTS OF ANY FINANCIAL
RESPONSIBILITY LAWS.

AUTHORIZATION. For purposes of insurance coverage on the Collateral, Grantor
authorizes Lender to provide to any person (including any insurance agent or
company) all information Lender deems appropriate, whether regarding the
Collateral, the loan or other financial accommodations, or both.

GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS AGREEMENT TO
PROVIDE INSURANCE AND AGREES TO ITS TERMS. THIS AGREEMENT IS DATED APRIL 19,
1996.

GRANTOR:

BOYD'S WHEELS, INC.

By: /s/ Boyd Coddington
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

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

FOR LENDER USE ONLY
INSURANCE VERIFICATION

DATE: PHONE:
------------------------------ ------------------------------
AGENT'S NAME:
-------------------------------------------------------------------
INSURANCE COMPANY:
--------------------------------------------------------------
POLICY NUMBER:
------------------------------------------------------------------
EFFECTIVE DATES:
----------------------------------------------------------------
COMMENTS:
-----------------------------------------------------------------------

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

================================================================================
LASER PRO, REG. U.S. PAT. & T.M. OFF., VER. 3.21 (C) 1996 CFI PROSERVICES, INC.
ALL RIGHTS RESERVED. [CA-D20 E3.20 41 BOYDS.LN C2.OVL]
11
[ELDORADO BANK LOGO]

DISBURSEMENT REQUEST AND AUTHORIZATION

LOAN TYPE. This is a Variable Rate (1.000% over WALL STREET JOURNAL PRIME
RATE, making an initial rate of 9.250%), Principal Plus interest Loan to a
Corporation for $2,500,000.00 due on May 1, 1997.

PRIMARY PURPOSE OF LOAN. The primary purpose of this loan is for (please
initial):

/ / ____ PERSONAL, FAMILY, OR HOUSEHOLD PURPOSES OR PERSONAL INVESTMENT

/x/ ____ BUSINESS (INCLUDING REAL ESTATE INVESTMENT)

SPECIFIC PURPOSE. The specific purpose of this loan is: TO RENEW AND INCREASE
REVOLVING LINE #13482, USED TO FINANCE ONGOING SALES GROWTH.

DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be
disbursed until all of Lender's conditions for making the loan have been
satisfied. Please disburse the loan proceeds of $2,500,000.00 as follows:

UNDISBURSED FUNDS: $1,950,000.00

AMOUNT PAID ON BORROWER'S ACCOUNT: $550,000.00
$550,000.00 Payment on Loan # 13482
-------------

NOTE PRINCIPAL: $2,500,000.00

CHARGES PAID IN CASH. Borrower has paid or will pay in cash as agreed the
following charges:

PREPAID FINANCE CHARGES PAID IN CASH: $0.00

OTHER CHARGES PAID IN CASH: $12,500.00
$12,500 Loan Fees
----------

TOTAL CHARGES PAID IN CASH: $12,500.00

FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND
WARRANTS TO LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND
THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S FINANCIAL
CONDITION AS DISCLOSED IN BORROWER'S MOST RECENT FINANCIAL STATEMENT TO LENDER.
THIS AUTHORIZATION IS DATED APRIL 19, 1996.

BORROWER:

BOYD'S WHEELS, INC.

BY: /s/ Boyd Coddington
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

================================================================================
VARIABLE RATE. LINE OF CREDIT.

LASER PRO, REG. U.S. PAT. & T.M. OFF., VER. 3.21 (C) 1996 CFI PROSERVICES, INC.
ALL RIGHTS RESERVED. [CA-120 E3.20 41 BOYDS.LN C2.OVL]
12
NOTICE OF INSURANCE REQUIREMENT

- ------------------------------------------------------------------------------------------------------------------
LOAN DATE LOAN NO CALL COLLATERAL CUSTOMER NO OFFICER INITIALS

04-19-1996 13482 511 055 104121 GG1
- ------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE APPLICABILITY OF THIS DOCUMENT TO ANY
- ------------------------------------------------------------------------------------------------------------------

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

TO: DATE: APRIL 19, 1996

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

DEAR INSURANCE AGENT:

BOYD'S WHEELS, INC. ("GRANTOR") IS OBTAINING A LOAN FROM ELDORADO BANK. PLEASE
SEND APPROPRIATE EVIDENCE OF INSURANCE TO ELDORADO BANK, TOGETHER WITH THE
REQUESTED ENDORSEMENTS, ON THE FOLLOWING PROPERTY, WHICH BORROWER IS GIVING AS
SECURITY FOR THE LOAN.

COLLATERAL: ALL INVENTORY, INCLUDING AS SECURITY FOR ALL PRESENTLY
EXISTING OR HEREAFTER ARISING OBLIGATIONS OF DEBTOR TO OR TO
SECURED PARTY, DEBTOR HEREBY GRANTS TO SECURED PARTY A
SECURITY INTEREST IN: ALL PROPERTY IN WHICH A SECURITY
INTEREST CAN BE GRANTED PURSUANT TO THE CALIFORNIA COMMERCIAL
CODE, WHICH PROPERTY INCLUDES, BUT IS NOT LIMITED, ALL
PRESENTLY EXISTING OR HEREAFTER ARISING, NOW OWNED OR
HEREAFTER ACQUIRED INVENTORY, EQUIPMENT, ACCOUNTS, CONTRACT
RIGHTS, CHATTEL PAPER, DOCUMENTS, INSTRUMENTS, GOODS, GENERAL
INTANGIBLES, DEPOSIT ACCOUNTS AND MONEY.
TYPE. All risks, including fire, theft and money.
AMOUNT. $2,500,000.00.
BASIS. Replacement value.
ENDORSEMENTS. Lender's loss payable clause with stipulation
that coverage will not be cancelled or diminished without a
minimum of ten (10) days' prior written notice to Lender.
DEDUCTIBLES. $1,000.00.

BORROWER:

BOYD'S WHEELS, INC.

By: /s/ Boyd Coddington
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

MAIL TO:
------------------------------
ELDORADO BANK
CENTRAL NOTE DEPARTMENT
P.O. BOX 15510
IRVINE, CA 92715
------------------------------

LASER PRO, Reg. U.S. Pat. & T.M. Off., Ver. 3.21 (c) 1996 CFI ProServices, Inc.
All Rights Reserved.
13
[ELDORADO BANK LOGO] COMMERCIAL SECURITY AGREEMENT

$2,500,000.00 04-19-1996 05-01-1997 13482 511 055 104121 GG1
- ----------------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR
- ----------------------------------------------------------------------------------------------------------------------------

BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17762 E. 17TH STREET
TUSTIN, CA 92680
================================================================================

THIS COMMERCIAL SECURITY AGREEMENT IS ENTERED INTO BETWEEN BOYD'S WHEELS, INC.
(REFERRED TO BELOW AS "GRANTOR"); AND ELDORADO BANK (REFERRED TO BELOW AS
"LENDER"). FOR VALUABLE CONSIDERATION, GRANTOR GRANTS TO LENDER A SECURITY
INTEREST IN THE COLLATERAL TO SECURE THE INDEBTEDNESS AND AGREES THAT LENDER
SHALL HAVE THE RIGHTS STATED IN THIS AGREEMENT WITH RESPECT TO THE COLLATERAL,
IN ADDITION TO ALL OTHER RIGHTS WHICH LENDER MAY HAVE BY LAW.

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

COLLATERAL. The word "Collateral" means the following described property
of Grantor, whether now owned or hereafter acquired, whether now existing
or hereafter arising, and wherever located:

ALL INVENTORY, ACCOUNTS AND GENERAL INTANGIBLES, TOGETHER WITH THE
FOLLOWING SPECIFICALLY DESCRIBED PROPERTY: AS SECURITY FOR ALL
PRESENTLY EXISTING OR HEREAFTER ARISING OBLIGATIONS OF DEBTOR TO OR
TO SECURED PARTY, DEBTOR HEREBY GRANTS TO SECURED PARTY A SECURITY
INTEREST IN: ALL PROPERTY IN WHICH A SECURITY INTEREST CAN BE
GRANTED PURSUANT TO THE CALIFORNIA COMMERCIAL CODE, WHICH PROPERTY
INCLUDES, BUT IS NOT LIMITED TO, ALL PRESENTLY EXISTING OR HEREAFTER
ARISING, NOW OWNED OR HEREAFTER ACQUIRED INVENTORY, EQUIPMENT,
ACCOUNTS, CONTRACT RIGHTS, CHATTEL PAPER, DOCUMENTS, INSTRUMENTS,
GOODS, GENERAL INTANGIBLES, DEPOSIT ACCOUNTS AND MONEY.

In addition, the word "Collateral" includes all the following, whether now
owned or hereafter acquired, whether now existing or hereafter arising,
and wherever located:

(a) All attachments, accessions, accessories, tools, parts,
supplies, increases, and additions to and all replacements of and
substitutions for any property described above.

(b) All products and produce of any of the property described in
this Collateral section.

(c) All accounts, general intangibles, instruments, rents, monies,
payments, and all other rights, arising out of a sale, lease, or
other disposition of any of the property described in this
Collateral section.

(d) All proceeds (including insurance proceeds) from the sale,
destruction, loss, or other disposition of any of the property
described in this Collateral section.

(e) All records and data relating to any of the property described
in this Collateral section, whether in the form of a writing,
photograph, microfilm, microfiche, or electronic media, together
with all of Grantor's right, title, and interest in and to all
computer software required to utilize, create, maintain, and process
any such records or data on electronic media.

EVENT OF DEFAULT. The words "Event of Default" mean and include without
limitation any of the Events of Default set forth below in the Section
titled "Events of Default."

GRANTOR. The word "Grantor" means BOYD'S WHEELS, INC., it successors and
assigns.

GUARANTOR. The word "Guarantor" means and includes without limitation
each and all of the guarantors, sureties, and accommodation parties in
connection with the indebtedness.

INDEBTEDNESS. The word "Indebtedness" means the indebtedness evidenced by
the Note, including all principal and interest, together with all other
indebtedness and costs and expenses for which Grantor is responsible under
this Agreement or under any of the Related Documents.

LENDER. The word "Lender" means ELDORADO BANK, its successors and
assigns.

NOTE. The word "Note" means the note or credit agreement dated April 19,
1996, in the principal amount of $2,500,000.00 from BOYD'S WHEELS, INC. to
Lender, together with all renewals of, extensions of, modifications of,
refinancings of, consolidations of and substitutions for the note or
credit agreement.

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

RIGHT OF SETOFF. Grantor hereby grants Lender a contractual possessory
security interest in and hereby assigns, conveys, delivers, pledges, and
transfers all of Grantor's right, title and interest in and to Grantor's
accounts with Lender (whether checking, savings, or some other account),
including all accounts held jointly with someone else and all accounts Grantor
may open in the future, excluding, however, all IRA and Keogh accounts, and all
trust accounts for which the grant of a security interest would be prohibited
by law. Grantor authorizes Lender, to the extent permitted by applicable law,
to charge or setoff all Indebtedness against any and all such accounts.

OBLIGATIONS OF GRANTOR. Grantor warrants and covenants to Lender as follows:

PERFECTION OF SECURITY INTEREST. Grantor agrees to execute such financing
statements and to take whatever other actions are requested by Lender to
perfect and continue Lender's security interest in the Collateral. Upon
request of Lender, Grantor will deliver to Lender any and all of the
documents evidencing or constituting the Collateral, and Grantor will note
Lender's interest upon any and all chattel paper if not delivered to
Lender for possession by Lender. Grantor hereby appoints Lender as its
irrevocable attorney-in-fact for the purpose of executing any documents
necessary to perfect or to continue the security interest granted in this
Agreement. Lender may at any time, and without further authorization from
Grantor, file a carbon, photographic or other reproduction of any
financing statement or of this Agreement for use as a financing statement.
Grantor will reimburse Lender for all expenses for the perfection and the
continuation of the perfection of Lender's security interest in the
Collateral. Grantor promptly will notify Lender before any change in
Grantor's name including any change to the assumed business names of
Grantor. THIS IS A CONTINUING SECURITY AGREEMENT AND WILL CONTINUE IN
EFFECT EVEN THOUGH ALL OR ANY PART OF THE INDEBTEDNESS IS PAID IN FULL AND
EVEN THOUGH FOR A PERIOD OF TIME GRANTOR MAY NOT BE INDEBTED TO LENDER.

NO VIOLATION. The execution and delivery of this Agreement will not
violate any law or agreement governing Grantor or to which Grantor is a
party, and its certificate or articles of incorporation and bylaws do not
prohibit any term or condition of this Agreement.

ENFORCEABILITY OF COLLATERAL. To the extent the Collateral consists of
accounts, chattel paper, or general intangibles, the Collateral is
enforceable in accordance with its terms, is genuine, and complies with
applicable laws concerning form, content and manner of preparation and
execution, and all persons appearing to be obligated on the Collateral
have authority and capacity to contract and are in fact obligated as they
appear to be on the Collateral. At any time any account becomes subject
to a security interest in favor of Lender, the account shall be a good and
valid account representing an undisputed, bona fide indebtedness incurred
by the account debtor, for merchandise held subject to delivery
instructions or therefore shipped or delivered pursuant to a contract of
sale, or for services therefore performed by Grantor with or for the
account debtor; there shall be no setoffs or counterclaims against any
such account; and no agreement under which any deductions or discounts may
be claimed shall have been made with the account debtor except those
disclosed to Lender in writing.
14
04-19-1996 COMMERCIAL SECURITY AGREEMENT PAGE 2
LOAN NO. 13482 (CONTINUED)
===============================================================================

LOCATION OF THE COLLATERAL. Grantor, upon request of Lender, will deliver
to Lender in form satisfactory to Lender a schedule of real properties and
Collateral locations relating to Grantor's operations, including without
limitation the following: (a) all real property owned or being purchased
by Grantor; (b) all real property being rented or leased by Grantor; (c)
all storage facilities owned, rented, leased, or being used by Grantor;
and (d) all other properties where Collateral is or may be located.
Except in the ordinary course of its business, Grantor shall not remove
the Collateral from its existing locations without the prior written
consent of Lender.

REMOVAL OF COLLATERAL. Grantor shall keep the Collateral (or to the
extent the Collateral consists of intangible property such as accounts,
the records concerning the Collateral) at Grantor's address shown above,
or at such other locations as are acceptable to Lender. Except in the
ordinary course of its business, including the sales of inventory, Grantor
shall not remove the Collateral from its existing locations without the
prior written consent of Lender. To the extent that the Collateral
consists of vehicles, or other titled property, Grantor shall not take or
permit any action which would require application for certificates of
title for the vehicles outside the State of California, without the prior
written consent of Lender.

TRANSACTIONS INVOLVING COLLATERAL. Except for inventory sold or accounts
collected in the ordinary course of Grantor's business, Grantor shall not
sell, offer to sell, or otherwise transfer or dispose of the Collateral.
While Grantor is not in default under this Agreement, Grantor may sell
inventory, but only in the ordinary course of its business and only to
buyers who qualify as a buyer in the ordinary course of business. A sale
in the ordinary course of Grantor's business does not include a transfer
in partial or total satisfaction of a debt or any bulk sale. Grantor
shall not pledge, mortgage, encumber or otherwise permit the Collateral to
be subject to any lien, security interest, encumbrance, or charge, other
than the security interest provided for in this Agreement, without the
prior written consent of Lender. This includes security interests even if
junior in right to the security interests granted under this Agreement.
Unless waived by Lender, all proceeds from any disposition of the
Collateral (for whatever reason) shall be held in trust for Lender and
shall not be commingled with any other funds; provided however, this
requirement shall not constitute a consent by Lender to any sale or other
disposition. Upon receipt, Grantor shall immediately deliver any such
proceeds to Lender.

TITLE. Grantor represents and warrants to Lender that it holds good and
marketable title to the Collateral, free and clear of all liens and
encumbrances except for the lien of this Agreement. No financing
statement covering any of the Collateral is on file in any public office
other than those which reflect the security interest created by this
Agreement or to which Lender has specifically consented. Grantor shall
defend Lender's rights in the Collateral against the claims and demands of
all other persons.

COLLATERAL SCHEDULES AND LOCATIONS. As often as Lender shall require, and
insofar as the Collateral consists of accounts and general intangibles,
Grantor shall deliver to Lender schedules of such Collateral, including
such information as Lender may require, including without limitation names
and addresses of account debtors and agings of accounts and general
intangibles. Insofar as the Collateral consists of inventory, Grantor
shall deliver to Lender, as often as Lender shall require, such lists,
descriptions, and designations of such Collateral as Lender may require to
identify the nature, extent, and location of such Collateral. Such
information shall be submitted for Grantor and each of its subsidiaries or
related companies.

MAINTENANCE AND INSPECTION OF COLLATERAL. Grantor shall maintain all
tangible Collateral in good condition and repair. Grantor will not commit
or permit damage to or destruction of the Collateral or any part of the
Collateral. Lender and its designated representatives and agents shall
have the right at all reasonable times to examine, inspect, and audit the
Collateral wherever located. Grantor shall immediately notify Lender of
all cases involving the return, rejection, repossession, loss or damage of
or to any Collateral; of any request for credit or adjustment or of any
other dispute arising with respect to the Collateral; and generally of all
happenings and events affecting the Collateral or the value or the amount
of the Collateral.

TAXES, ASSESSMENTS AND LIENS. Grantor will pay when due all taxes,
assessments and liens upon the Collateral, its use or operation, upon this
Agreement, upon any promissory note or notes evidencing the Indebtedness,
or upon any of the other Related Documents. Grantor may withhold any such
payment or may elect to contest any lien if Grantor is in good faith
conducting an appropriate proceeding to contest the obligation to pay and
so long as Lender's interest in the Collateral is not jeopardized in
Lender's sole opinion. If the Collateral is subjected to a lien which is
not discharged within fifteen (15) days, Grantor shall deposit with Lender
cash, a sufficient corporate surety bond or other security satisfactory to
Lender in an amount adequate to provide for the discharge of the lien plus
any interest, costs, attorneys' fees or other charges that could accrue as
a result of foreclosure or sale of the Collateral. In any contest Grantor
shall defend itself and Lender and shall satisfy any final adverse
judgment before enforcement against the Collateral. Grantor shall name
Lender as an additional obligee under any surety bond furnished in the
contest proceedings.

COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. Grantor shall comply promptly
with all laws, ordinances, rules and regulations of all governmental
authorities, now or hereafter in effect, applicable to the ownership,
production, disposition, or use of the Collateral. Grantor may contest in
good faith any such law, ordinance or regulation and withhold compliance
during any proceeding, including appropriate appeals, so long as Lender's
interest in the Collateral, in Lender's opinion, is not jeopardized.

HAZARDOUS SUBSTANCES. Grantor represents and warrants that the Collateral
never has been, and never will be so long as this Agreement remains a lien
on the Collateral, used for the generation, manufacture, storage,
transportation, treatment, disposal, release or threatened release of any
hazardous waste or substance, as those terms are defined in the
Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended, 42 U.S.C. Section 9601, et seq. ("CERCLA"), the
Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499
("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C. Section
1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C.
Section 6901, et seq., Chapters 6.5 through 7.7 of Division 20 of the
California Health and Safety Code, Section 25100, et seq., or other
applicable state or Federal laws, rules, or regulations adopted pursuant
to any of the foregoing. The terms "hazardous waste" and "hazardous
substance" shall also include, without limitation, petroleum and petroleum
by-products or any fraction thereof and asbestos. The representations and
warranties contained herein are based on Grantor's due diligence in
investigating the Collateral for hazardous wastes and substances. Grantor
hereby (a) releases and waives any future claims against Lender for
indemnity or contribution in the event Grantor becomes liable for cleanup
or other costs under any such laws, and (b) agrees to indemnify and hold
harmless Lender against any and all claims and losses resulting from a
breach of this provision of this Agreement. This obligation to indemnify
shall survive the payment of the Indebtedness and the satisfaction of this
Agreement.

MAINTENANCE OF CASUALTY INSURANCE. Grantor shall procure and maintain all
risks insurance, including without limitation fire, theft and liability
coverage together with such other insurance as Lender may require with
respect to the Collateral, in form, amounts, coverages and basis
reasonably acceptable to Lender and issued by a company or companies
reasonably acceptable to Lender. Grantor, upon request of Lender, will
deliver to Lender from time to time the policies or certificates of
insurance in form satisfactory to Lender, including stipulations that
coverages will not be cancelled or diminished without at least ten (10)
days' prior written notice to Lender and not including any disclaimer of
the insurer's liability for failure to give such a notice. Each insurance
policy also shall include an endorsement providing that coverage in favor
of Lender will not be impaired in any way by any act, commission or
default of Grantor or any other person. In connection with all policies
covering assets in which Lender holds or is offered a security interest,
Grantor will provide Lender with such loss payable or other endorsements
as Lender may require. In no event shall the insurance be in an amount
less than the amount agreed upon in the Agreement to Provide Insurance.
If Grantor at any time fails to obtain or maintain any insurance as
required under this Agreement, Lender may (but shall not be obligated to)
obtain such insurance as Lender deems appropriate, including if it so
chooses "single interest insurance," which will cover only Lender's
interest in the Collateral.

APPLICATION OF INSURANCE PROCEEDS. Grantor shall promptly notify Lender
of any loss or damage to the Collateral. Lender may make proof of loss if
Grantor fails to do so within fifteen (15) days of the casualty. All
proceeds of any insurance on the Collateral, including accrued proceeds
thereon, shall be held by Lender as part of the Collateral. If Lender
consents to repair or replacement of the damaged or destroyed Collateral,
Lender shall, upon satisfactory expenditure, pay or reimburse Grantor from
the proceeds for the reasonable cost of repair or restoration. If Lender
does not consent to repair or replacement of the Collateral, Lender shall
retain a sufficient amount of the proceeds to pay all of the Indebtedness,
and shall pay the balance to Grantor. Any proceeds which have not been
disbursed within six (6) months after their receipt and which Grantor has
not committed to the repair or restoration of the Collateral shall be used
to repay the Indebtedness.

INSURANCE RESERVES. Lender may require Grantor to maintain with Lender
reserves for payment of insurance premiums, which reserves shall be
created by monthly payments from Grantor of a sum estimated by Lender to
be sufficient to produce, at least fifteen (15) days before the premium
due date, amounts at least equal to the insurance premiums to be paid. If
fifteen (15) days before payment is due, the reserve funds are
insufficient, Grantor shall upon demand pay any deficiency to Lender. The
reserve funds shall be held by Lender as a general deposit and shall
constitute a non-interest-bearing account which Lender may satisfy by
payment of the insurance premiums required to be paid by Grantor as they
become due. Lender does not hold the reserve funds in trust for Grantor,
and Lender is not the agent of Grantor for payment of the insurance
premiums required to be paid by Grantor. The responsibility for the
payment of premiums shall remain grantor's sole responsibility.

INSURANCE REPORTS. Grantor, upon request of Lender, shall furnish to
Lender reports on each existing policy of insurance showing such
information as Lender may reasonably request including the following: (a)
the name of the insurer; (b) the risks insured; (c) the amount of the
policy; (d) the property insured; (e) the then current value on the basis
of which insurance has been obtained and the manner of determining that
value; and (f) the expiration date of the policy. In addition, Grantor

shall upon request by Lender (however not more often than annually) have
an independent appraiser satisfactory to Lender determine, as applicable,
the cash value or replacement cost of the Collateral.

GRANTOR'S RIGHT TO POSSESSION AND TO COLLECT ACCOUNTS. Until default and
except as otherwise provided below with respect to accounts, Grantor may have
possession of the tangible personal property and beneficial use of all the
Collateral and may use it in any lawful manner not inconsistent with this
Agreement or the Related Documents, provided that Grantor's right to possession
and beneficial use shall not
15
04-19-1996 COMMERCIAL SECURITY AGREEMENT PAGE 3
LOAN NO. 13482 (CONTINUED)
===============================================================================

apply to any Collateral where possession of the Collateral by Lender is
required by law to perfect Lender's security interest in such Collateral.
Unless otherwise notified by Lender, Grantor may collect any of the Collateral
consisting of accounts. At any time and even though no Event of Default
exists, Lender may exercise its rights to collect the accounts and to notify
account debtors to make payments directly to Lender for application to the
Indebtedness. If Lender at any time has possession of any Collateral, whether
before or after an Event of Default, Lender shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral if Lender
takes such action for that purpose as Grantor shall request or as Lender, in
Lender's sole discretion, shall deem appropriate under the circumstances, but
failure to honor any request by Grantor shall not of itself be deemed to be a
failure to exercise reasonable care. Lender shall not be required to take any
steps necessary to preserve any rights in the Collateral against prior parties,
nor to protect, preserve or maintain any security interest given to secure the
Indebtedness.

EXPENDITURES BY LENDER. If not discharged or paid when due, Lender may (but
shall not be obligated to) discharge or pay any amounts required to be
discharged or paid by Grantor under this Agreement, including without
limitation all taxes, liens, security interests, encumbrances, and other
claims, at any time levied or placed on the Collateral. Lender also may (but
shall not be obligated to) pay all costs for insuring, maintaining and
preserving the Collateral. All such expenditures incurred or paid by Lender
for such purposes will then bear interest at the rate charged under the Note
from the date incurred or paid by Lender to the date of repayment by Grantor.
All such expenses shall become a part of the Indebtedness and, at Lender's
option, will (a) be payable on demand, (b) be added to the balance of the Note
and be apportioned among and be payable with any installment payments to become
due during either (i) the terms of any applicable insurance policy or (ii) the
remaining terms of the Note, or (c) be treated as a balloon payment which will
be due and payable at the Note's maturity. This Agreement also will secure
payment of these amounts. Such right shall be in addition to all other rights
and remedies to which Lender may be entitled upon the occurrence of an Event of
Default.

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

DEFAULT ON INDEBTEDNESS. Failure of Grantor to make any payment when due
on the Indebtedness.

OTHER DEFAULTS. Failure of Grantor to comply with or to perform any other
term, obligation, covenant or condition contained in this Agreement or in
any of the Related Documents or in any other agreement between Lender and
Grantor.

DEFAULT IN FAVOR OF THIRD PARTIES. Should Borrower or any Grantor default
under any loan, extension of credit, security agreement, purchase of sales
agreement, or any other agreement, in favor of any other creditor or
person that may materially affect any of Borrower's property or Borrower's
or any Grantor's ability to repay the Loans or perform their respective
obligations under this Agreement or any of the Related Documents.

FALSE STATEMENTS. Any warranty, representation or statement made or
furnished to Lender by or on behalf of Grantor under this Agreement, the
Note or the Related Documents is false or misleading in any material
respect, either now or at the time made or furnished.

DEFECTIVE COLLATERALIZATION. This Agreement or any of the Related
Documents ceases to be in full force and effect (including failure of any
collateral documents to create a valid and perfected security interest or
lien) at any time and for any reason.

INSOLVENCY. The dissolution or termination of Grantor's existence as a
going business, the insolvency of Grantor, the appointment of a receiver
for any part of Grantor's property, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any
proceeding under any bankruptcy or insolvency laws by or against Grantor.

CREDITOR OR FORFEITURE PROCEEDINGS. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Grantor or by any
governmental agency against the Collateral or any other collateral
securing the Indebtedness. This includes a garnishment of any Grantor's
deposit accounts with Lender.

EVENTS AFFECTING GUARANTOR. Any of the preceding events occurs with
respect to any Guarantor of any of the Indebtedness or such Guarantor dies
or becomes incompetent.

ADVERSE CHANGE. A material adverse change occurs in Grantor's financial
condition, or Lender believes the prospect of payment or performance of
the Indebtedness is impaired.

INSECURITY. Lender, in good faith, deems itself insecure.

RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under this
Agreement, at any time thereafter, Lender shall have the rights of a secured
party under the California Uniform Commercial Code. In addition and without
limitation, Lender may exercise any one or more of the following right and
remedies:

ACCELERATE INDEBTEDNESS. Lender may declare the entire Indebtedness,
including any prepayment penalty which Grantor would be required to pay,
immediately due and payable, without notice.

ASSEMBLE COLLATERAL. Lender may require Grantor to deliver to Lender all
or any portion of the Collateral and any and all certificates of title and
other documents relating to the Collateral. Lender may require Grantor to
assemble the Collateral and make it available to Lender at a place to be
designated by Lender. Lender also shall have full power to enter upon the
property of Grantor to take possession of and remove the Collateral. If
the Collateral contains other goods not covered by this Agreement at the
time repossession, Grantor agrees Lender may take such other goods,
provided that Lender makes reasonable efforts to return them to Grantor
after repossession.

SELL THE COLLATERAL. Lender shall have full power to sell, lease,
transfer, or otherwise deal with the Collateral or proceeds thereof in it
own name or that of Grantor. Lender may sell the Collateral at public
auction or private sale. Unless the Collateral threatens to decline
speedily in value or is of a type customarily sold on a recognized market,
Lender will give Grantor reasonable notice of the time after which any
private sale or any other intended disposition of the Collateral is to be
made. The requirements of reasonable notice shall be met if such notice
is given at least ten (10) days, or such lesser time as required by state
law, before the time of the sale or disposition. All expenses relating to
the disposition of the Collateral, including without limitation the
expenses of retaking, holding, insuring, preparing for sale and selling
the Collateral, shall become a part of the Indebtedness secured by this
Agreement and shall be payable on demand, with interest at the Note rate
from date of expenditure until repaid.

APPOINT RECEIVER. To the extent permitted by applicable law, Lender shall
have the following rights and remedies regarding the appointment of a
receiver: (a) Lender may have a receiver appointed as a matter of right,
(b) the receiver may be an employee of Lender and may serve without bond,
and (c) all fees of the receiver and his or her attorney shall become part
of the Indebtedness secured by this Agreement and shall be payable on
demand, with interest at the Note rate from date of expenditure until
repaid.

COLLECT REVENUES, APPLY ACCOUNTS. Lender, either itself or through a
receiver, may collect the payments, rents, income, and revenues from the
Collateral. Lender may at any time in its discretion transfer any
Collateral into its own name or that of its nominee and receive the
payments, rents, income, and revenues therefrom and hold the same as
security for the Indebtedness or apply it to payment of the Indebtedness
in such order of preference as Lender may determine. Insofar as the
Collateral consists of accounts, general intangibles, insurance policies,
instruments, chattel paper, choses in action, or similar property, Lender
may demand, collect, receipt for, settle, compromise, adjust, sue for,
foreclose, or realize on the Collateral as Lender may determine, whether
or not Indebtedness or Collateral is then due. For these purposes, Lender
may, on behalf of and in the name of Grantor, receive, open and dispose of
mail addressed to Grantor, change any address to which mail and payments
are to be sent; and endorse notes, checks, drafts, money orders, documents
of title, instruments and items pertaining to payment, shipment, or
storage of any Collateral. To facilitate collection, Lender may notify
account debtors and obligors on any Collateral to make payments directly
to Lender.

OBTAIN DEFICIENCY. If Lender chooses to sell any or all of the
Collateral, Lender may obtain a judgment against Grantor for any
deficiency remaining on the Indebtedness due to Lender after application
of all amounts received from the exercise of the rights provided in this
Agreement. Grantor shall be liable for a deficiency even if the
transaction described in this subsection is a sale of accounts or chattel
paper.

OTHER RIGHTS AND REMEDIES. Lender shall have all the rights and remedies
of a secured creditor under the provisions of the Uniform Commercial Code,
as may be amended from time to time. In addition, Lender shall have and
may exercise any or all other rights and remedies it may have available at
law, in equity, or otherwise.

CUMULATIVE REMEDIES. All of Lender's rights and remedies, whether
evidenced by this Agreement or the Related Documents or by any other
writing, shall be cumulative and may be exercised singularly or
concurrently. Election by Lender to pursue any remedy shall not exclude
pursuit of any other remedy, and an election to make expenditures or to
take action to perform an obligation of Grantor under this Agreement,
after Grantor's failure to perform, shall not affect Lender's right to
declare a default and to exercise its remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement:

AMENDMENTS. This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties as to
the matters set forth in this Agreement. No alteration of or amendment to
this Agreement shall be effective unless given in writing and signed by
the party or parties sought to be charged or bound by the alteration or
amendment.
16
04-19-1996 COMMERCIAL SECURITY AGREEMENT PAGE 4
LOAN NO. 13482 (CONTINUED)
===============================================================================

APPLICABLE LAW. This Agreement has been delivered to Lender and accepted
by Lender in the State of California. If there is a lawsuit, Grantor
agrees upon Lender's request to submit to the jurisdiction of the courts
of ORANGE County, State of California. This Agreement shall be governed
by and construed in accordance with the laws of the State of California.

ATTORNEYS' FEES; EXPENSES. Grantor agrees to pay upon demand all of
Lender's costs and expenses, including attorneys' fees and Lender's legal
expenses, incurred in connection with the enforcement of this Agreement.
Lender may pay someone else to help enforce this Agreement and Grantor
shall pay the costs and expenses of such enforcement. Costs and expenses
include Lender's attorneys' fees and legal expenses whether or not there
is a lawsuit, including attorneys' fees and legal expenses for bankruptcy
proceedings (and including efforts to modify or vacate any automatic stay
or injunction), appeals, and any anticipated post-judgment collection
services. Grantor also shall pay all court costs and such additional fees
as may be directed by the court.

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

MULTIPLE PARTIES; CORPORATE AUTHORITY. All obligations of Grantor under
this Agreement shall be joint and several, and all references to Grantor
shall mean each and every Grantor. This means that each of the Borrowers
signing below is responsible for ALL obligations in this Agreement.

NOTICES. All notices required to be given under this Agreement shall be
given in writing, may be sent by telefacsimile, and shall be effective
when actually delivered or when deposited with a nationally recognized
overnight courier or deposited in the United States mail, first class,
postage prepaid, addressed to the party to whom the notice is to be given
at the address shown above. Any party may change its address for notices
under this Agreement by giving formal written notice to the other parties,
specifying that the purpose of the notice is to change the party's
address. To the extent permitted by applicable law, if there is more than
one Grantor, notice to any Grantor will constitute notice to all Grantors.
For notice purposes, Grantor will keep Lender informed at all times of
Grantor's current address(es).

POWER OF ATTORNEY. Grantor hereby appoints Lender as its true and lawful
attorney-in-fact, irrevocably, with full power of substitution to do the
following: (a) to demand, collect, receive, receipt for, sue and recover
all sums of money or other property which may now or hereafter become due,
owing or payable from the Collateral; (b) to execute, sign and endorse any
and all claims, instruments, receipts, checks, drafts or warrants issued
in payment for the Collateral; (c) to settle or compromise any and all
claims arising under the Collateral, and, in the place and stead of
Grantor, to execute and deliver its release and settlement for the claim;
and (d) to file any claim or claims or to take any action or institute or
take part in any proceedings, either in its own name or in the name of
Grantor, or otherwise, which in the discretion of Lender may seem to be
necessary or advisable. This power is given as security for the
Indebtedness, and the authority hereby conferred is and shall be
irrevocable and shall remain in full force and effect until renounced by
Lender.

PREFERENCE PAYMENTS. Any monies Lender pays because of an asserted
preference claim in Borrower's bankruptcy will become a part of the
Indebtedness and, at Lender's option, shall be payable by Borrower as
provided above in the "EXPENDITURES BY LENDER" paragraph.

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

SUCCESSOR INTERESTS. Subject to the limitations set forth above on
transfer of the Collateral, this Agreement shall be binding upon and inure
to the benefit of the parties, their successors and assigns.

WAIVER. Lender shall not be deemed to have waived any rights under this
Agreement unless such waiver is given in writing and signed by Lender. No
delay or omission on the part of Lender in exercising any right shall
operate as a waiver of such right or any other right. A waiver by Lender
of a provision of this Agreement shall not prejudice or constitute a
waiver of Lender's right otherwise to demand strict compliance with that
provision or any other provision of this Agreement. No prior waiver by
Lender, nor any course of dealing between Lender and Grantor, shall
constitute a waiver of any of Lender's rights or of any of Grantor's
obligations as to any future transactions. Whenever the consent of Lender
is required under this Agreement, the granting of such consent by Lender
in any instance shall not constitute continuing consent to subsequent
instances where such consent is required and in all cases such consent may
be granted or withheld in the sole discretion of Lender.

WAIVER OF CO-OBLIGOR'S RIGHTS. If more than one person is obligated for
the Indebtedness, Borrower irrevocably waives, disclaims and relinquishes
all claims against such other person which Borrower has or would otherwise
have by virtue of payment of the Indebtedness or any part thereof,
specifically including but not limited to all rights of indemnity,
contribution or exoneration.

GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS COMMERCIAL SECURITY
AGREEMENT, AND GRANTOR AGREES TO ITS TERMS. THIS AGREEMENT IS DATED APRIL 19,
1996.

GRANTOR:

BOYD'S WHEELS, INC.

BY: /s/ Boyd Coddington
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

================================================================================
LASER PRO, REG. U.S. PAT. & T.M. OFF., VER. 3.21 (C) 1996 CFI PROSERVICES, INC.
ALL RIGHTS RESERVED. [CA-E20 E3.20 41 BOYDS.LN C2.OVL]
17
AGREEMENT TO PROVIDE INSURANCE

- ----------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL LOAN DATE MATURITY LOAN NO. CALL COLLATERAL ACCOUNT OFFICER INITIALS

$1,000,000.00 04-19-1996 05-01-1997 13678 511 055 104121 GG1
- ----------------------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN
OR ITEM.
- ----------------------------------------------------------------------------------------------------------------------------------

BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17752 E. 17TH STREET
TUSTIN, CA 92680

INSURANCE REQUIREMENTS. BOYD'S WHEELS, INC. ("GRANTOR") UNDERSTANDS THAT
INSURANCE COVERAGE IS REQUIRED IN CONNECTION WITH THE EXTENDING OF A LOAN OR THE
PROVIDING OF OTHER FINANCIAL ACCOMMODATIONS TO GRANTOR BY LENDER. THESE
REQUIREMENTS ARE SET FORTH IN THE SECURITY DOCUMENTS. THE FOLLOWING MINIMUM
INSURANCE COVERAGES MUST BE PROVIDED ON THE FOLLOWING DESCRIBED COLLATERAL (THE
"COLLATERAL"):

COLLATERAL: ALL INVENTORY, INCLUDING AS SECURITY FOR ALL PRESENTLY EXISTING
OR HEREAFTER ARISING OBLIGATIONS OF DEBTOR TO OR TO SECURED
PARTY, DEBTOR HEREBY GRANTS TO SECURED PARTY A SECURITY INTEREST
IN: ALL PROPERTY IN WHICH A SECURITY INTEREST CAN BE GRANTED
PURSUANT TO THE CALIFORNIA COMMERCIAL CODE, WHICH PROPERTY
INCLUDES, BUT IS NOT LIMITED TO, ALL PRESENTLY OR HEREAFTER
ARISING, NOW OWNED OR HEREAFTER ACQUIRED INVENTORY, EQUIPMENT,
ACCOUNTS, CONTRACT RIGHTS, CHATTEL PAPER, DOCUMENTS, INSTRUMENTS,
GOODS, GENERAL INTANGIBLES, DEPOSIT ACCOUNTS AND MONEY.
TYPE. ALL RISKS, INCLUDING FIRE, THEFT AND LIABILITY.
AMOUNT. $1,000,000.00.
BASIS. REPLACEMENT VALUE.
ENDORSEMENTS. LENDER'S LOSS PAYABLE CLAUSE WITH STIPULATION THAT
COVERAGE WILL NOT BE CANCELLED OR DIMINISHED WITHOUT A MINIMUM OF
TEN (10) DAYS' PRIOR WRITTEN NOTICE TO LENDER.
DEDUCTIBLES. $1,000.00.

INSURANCE COMPANY. GRANTOR MAY OBTAIN INSURANCE FROM ANY INSURANCE COMPANY
GRANTOR MAY CHOOSE THAT IS REASONABLY ACCEPTABLE TO LENDER. GRANTOR UNDERSTANDS
THAT CREDIT MAY NOT BE DENIED SOLELY BECAUSE INSURANCE WAS NOT PURCHASED THROUGH
LENDER.

INSURANCE MAILING ADDRESS. ALL DOCUMENTS AND OTHER MATERIALS RELATING TO
INSURANCE FOR THIS LOAN SHOULD BE MAILED, DELIVERED OR DIRECTED TO THE FOLLOWING
ADDRESS:

ELDORADO BANK
CENTRAL NOTE DEPARTMENT
P.O. BOX 15510
IRVINE, CA 92715
(714) 798-1100

FAILURE TO PROVIDE INSURANCE. GRANTOR AGREES TO DELIVER TO LENDER, TEN (10) DAYS
FROM THE DATE OF THIS AGREEMENT, EVIDENCE OF THE REQUIRED INSURANCE AS PROVIDED
ABOVE, WITH AN EFFECTIVE DATE OF APRIL 19, 1996, OR EARLIER. GRANTOR
ACKNOWLEDGES AND AGREES THAT IF GRANTOR FAILS TO PROVIDE ANY REQUIRED INSURANCE
OR FAILS TO CONTINUE SUCH INSURANCE IN FORCE, LENDER MAY DO SO AT GRANTOR'S
EXPENSES AS PROVIDED IN THE APPLICABLE SECURITY DOCUMENT. THE COST OF ANY SUCH
INSURANCE, AT THE OPTION OF LENDER, SHALL BE PAYABLE ON DEMAND OR SHALL BE ADDED
TO THE INDEBTEDNESS AS PROVIDED IN THE SECURITY DOCUMENT. GRANTOR ACKNOWLEDGES
THAT IF LENDER SO PURCHASES ANY SUCH INSURANCE, THE INSURANCE WILL PROVIDE
LIMITED PROTECTION AGAINST PHYSICAL DAMAGE TO THE COLLATERAL, UP TO THE BALANCE
OF THE LOAN; HOWEVER, GRANTOR'S EQUITY IN THE COLLATERAL MAY NOT BE INSURED. IN
ADDITION, THE INSURANCE MAY NOT PROVIDE ANY PUBLIC LIABILITY OR PROPERTY DAMAGE
INDEMNIFICATION AND MAY NOT MEET THE REQUIREMENTS OF ANY FINANCIAL
RESPONSIBILITY LAWS.

AUTHORIZATION. FOR PURPOSES OF INSURANCE COVERAGE ON THE COLLATERAL, GRANTOR
AUTHORIZES LENDER TO PROVIDE TO ANY PERSON (INCLUDING ANY INSURANCE AGENT OR
COMPANY) ALL INFORMATION LENDER DEEMS APPROPRIATE, WHETHER REGARDING THE
COLLATERAL, THE LOAN OR OTHER FINANCIAL ACCOMMODATIONS, OR BOTH.

GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS AGREEMENT TO PROVIDE
INSURANCE AND AGREES TO ITS TERMS. THIS AGREEMENT IS DATED APRIL 19, 1996.

GRANTOR:

BOYD'S WHEELS, INC.

BY: /s/ BOYD CODDINGTON
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

FOR LENDER USE ONLY
INSURANCE VERIFICATION
DATE:______________________________ PHONE:____________________________
AGENT'S NAME:___________________________________________________________________
INSURANCE COMPANY:______________________________________________________________
POLICY NUMBER:__________________________________________________________________
EFFECTIVE DATES:________________________________________________________________
COMMENTS: ______________________________________________________________________

LASER PRO, REG. U.S. PAT. & T.M. OFF., VER. 3.21 (C) 1996 CFI PROSERVICES, INC.
ALL RIGHTS RESERVED. [CA-110 E3.20 41 BOYDS3.LN C2.OVL]
18
[ELDORADO BANK CORP. LOGO]

DISBURSEMENT REQUEST AND AUTHORIZATION

- ------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL LOAN DATE MATURITY LOAN NO. CALL COLLATERAL ACCOUNT OFFICER INITIALS

$1,000,000.00 04-19-1996 05-01-1997 13678 511 055 104121 GG1
- ------------------------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN
OR ITEM.
- ------------------------------------------------------------------------------------------------------------------------------------

BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17752 E. 17TH STREET
TUSTIN, CA 92680

LOAN TYPE. THIS IS A VARIABLE RATE (1.750% OVER WALL STREET JOURNAL PRIME RATE,
MAKING AN INITIAL RATE OF 10.000%), PRINCIPAL PLUS INTEREST LOAN TO A
CORPORATION FOR $599,874.42 DUE ON MAY 1, 2001.

PRIMARY PURPOSE OF LOAN. THE PRIMARY PURPOSE OF THIS LOAN IS FOR (PLEASE
INITIAL):

/ / ____ PERSONAL, FAMILY, OR HOUSEHOLD PURPOSES OR PERSONAL INVESTMENT

/X/ ____ BUSINESS (INCLUDING REAL ESTATE INVESTMENT)

SPECIFIC PURPOSE. THE SPECIFIC PURPOSE OF THIS LOAN IS: TO TERM OUT NOTE #13483,
ORIGINAL PURPOSE WAS TO PURCHASE EQUIPMENT.

DISBURSEMENT INSTRUCTIONS. BORROWER UNDERSTANDS THAT NO LOAN PROCEEDS WILL BE
DISBURSED UNTIL ALL OF LENDER'S CONDITIONS FOR MAKING THE LOAN HAVE BEEN
SATISFIED. PLEASE DISBURSE THE LOAN PROCEEDS OF $1,000,000.00 AS FOLLOWS:

UNDISBURSED FUNDS: $1,000,000.00
-------------

NOTE PRINCIPAL: $1,000.000.00

CHARGES PAID IN CASH. BORROWER HAS PAID OR WILL PAY IN CASH AS AGREED THE
FOLLOWING CHARGES:

PREPAID FINANCE CHARGES PAID IN CASH: $0.00

OTHER CHARGES PAID IN CASH: $290.00
$290.00 DOCUMENTATION FEE:
-------
TOTAL CHARGES PAID IN CASH: $290.00

FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND
WARRANTS TO LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND
THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S FINANCIAL CONDITION
AS DISCLOSED IN BORROWER'S MOST RECENT FINANCIAL STATEMENT TO LENDER. THIS
AUTHORIZATION IS DATED APRIL 19, 1996.

BORROWER:

BOYD'S WHEELS, INC.

BY: /s/ BOYD CODDINGTON
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

PROMISSORY NOTE

$1,000,000.00 04-19-1996 05-01-1997 13678 511 055 104121 GG1
- ------------------------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN
OR ITEM.
- ------------------------------------------------------------------------------------------------------------------------------------

BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17752 E. 17TH STREET
TUSTIN, CA 92680

PRINCIPAL AMOUNT: $1,000,000.00 INITIAL RATE: 9.750% DATE OF NOTE: APRIL 19, 1996

PROMISE TO PAY. BOYD'S WHEELS, INC. ("BORROWER") PROMISES TO PAY TO ELDORADO
BANK ("LENDER"), OR ORDER, IN LAWFUL MONEY OF THE UNITED STATES OF AMERICA, THE
PRINCIPAL AMOUNT OF ONE MILLION & 00/100 DOLLARS ($1,000,000.00) OR SO MUCH AS
MAY BE OUTSTANDING, TOGETHER WITH INTEREST ON THE UNPAID OUTSTANDING PRINCIPAL
BALANCE OF EACH ADVANCE. INTEREST SHALL BE CALCULATED FROM THE DATE OF EACH
ADVANCE UNTIL REPAYMENT OF EACH ADVANCE.

PAYMENT. BORROWER WILL PAY THIS LOAN ON DEMAND, OR IF NO DEMAND IS MADE, IN ONE
PAYMENT OF ALL OUTSTANDING PRINCIPAL PLUS ALL ACCRUED UNPAID INTEREST ON MAY 1,
1997. IN ADDITION BORROWER WILL PAY REGULAR MONTHLY PAYMENTS OF ACCRUED UNPAID
INTEREST BEGINNING JUNE 1, 1996, AND ALL SUBSEQUENT INTEREST PAYMENTS ARE DUE ON
THE SAME DAY OF EACH MONTH AFTER THAT. INTEREST ON THIS NOTE IS COMPUTED ON A
365/360 SIMPLE INTEREST BASIS; THAT IS, BY APPLYING THE RATIO OF THE ANNUAL
INTEREST RATE OVER A YEAR OF 360 DAYS, MULTIPLIED BY THE OUTSTANDING PRINCIPAL
BALANCE, MULTIPLIED BY THE ACTUAL NUMBER OF DAYS THE PRINCIPAL BALANCE IS
OUTSTANDING. BORROWER WILL PAY LENDER AT LENDER'S ADDRESS SHOWN ABOVE OR AT SUCH
OTHER PLACE AS LENDER MAY DESIGNATE IN WRITING. UNLESS OTHERWISE AGREED OR
REQUIRED BY APPLICABLE LAW, PAYMENTS WILL BE APPLIED FIRST TO ACCRUED UNPAID
INTEREST, THEN TO PRINCIPAL, AND ANY REMAINING AMOUNT TO ANY UNPAID COLLECTION
COSTS AND LATE CHARGES.

VARIABLE INTEREST RATE. THE INTEREST RATE ON THIS NOTE IS SUBJECT TO CHANGE FROM
TIME TO TIME BASED ON CHANGES IN AN INDEPENDENT INDEX WHICH IS THE WALL STREET
JOURNAL PRIME RATE (THE "INDEX"). THE INDEX IS NOT NECESSARILY THE LOWEST RATE
CHARGED BY LENDER ON ITS LOANS. IF THE INDEX BECOMES UNAVAILABLE DURING THE TERM
OF THIS LOAN, LENDER MAY DESIGNATE A SUBSTITUTE INDEX AFTER NOTICE TO BORROWER.
LENDER WILL TELL BORROWER THE CURRENT INDEX RATE UPON BORROWER'S REQUEST.
BORROWER UNDERSTANDS THAT LENDER MAY MAKE LOANS BASED ON OTHER RATES AS WELL.
THE INTEREST RATE CHANGE WILL NOT OCCUR MORE OFTEN THAN EACH DAY. THE INDEX
CURRENTLY IS 8.250% PER ANNUM. THE INTEREST RATE TO BE APPLIED TO THE UNPAID
PRINCIPAL BALANCE OF THIS NOTE WILL BE AT A RATE OF 1.500 PERCENTAGE POINTS OVER
THE INDEX, RESULTING IN AN INITIAL RATE OF 9.750% PER ANNUM. NOTICE: UNDER NO
CIRCUMSTANCES WILL THE INTEREST RATE ON THIS NOTE BE MORE THAN THE MAXIMUM RATE
ALLOWED BY APPLICABLE LAW.

PREPAYMENT; MINIMUM INTEREST CHARGE. IN ANY EVENT, EVEN UPON FULL PREPAYMENT OF
THIS NOTE, BORROWER UNDERSTANDS THAT LENDER IS ENTITLED TO A MINIMUM INTEREST
CHARGE OF $100.00. OTHER THAN BORROWER'S OBLIGATION TO PAY ANY MINIMUM INTEREST
CHARGE, BORROWER MAY PAY WITHOUT PENALTY ALL OR A PORTION OF THE AMOUNT OWED
EARLIER THAN IT IS DUE. EARLY PAYMENTS WILL NOT, UNLESS AGREED TO BY LENDER IN
WRITING, RELIEVE BORROWER OF BORROWER'S OBLIGATION TO CONTINUE TO MAKE PAYMENTS
OF ACCRUED UNPAID INTEREST. RATHER, THEY WILL REDUCE THE PRINCIPAL BALANCE DUE.

LATE CHARGE. IF A PAYMENT IS 10 DAYS OR MORE LATE, BORROWER WILL BE CHARGED
5.000% OF THE REGULARLY SCHEDULED PAYMENT OR $10.00, WHICHEVER IS GREATER.

DEFAULT. BORROWER WILL BE IN DEFAULT IF ANY OF THE FOLLOWING HAPPENS: (A)
BORROWER FAILS TO MAKE ANY PAYMENT WHEN DUE. (B) BORROWER BREAKS ANY PROMISE
BORROWER HAD MADE TO LENDER, OR BORROWER FAILS TO COMPLY WITH OR TO PERFORM WHEN
DUE ANY OTHER TERM, OBLIGATION, COVENANT, OR CONDITION CONTAINED IN THIS NOTE OR
ANY AGREEMENT RELATED TO THIS NOTE, OR IN ANY OTHER AGREEMENT OR LOAN BORROWER
HAS WITH LENDER. (C) BORROWER DEFAULTS UNDER ANY LOAN, EXTENSION OF CREDIT,
SECURITY AGREEMENT, PURCHASE OR SALES AGREEMENT, OR ANY OTHER AGREEMENT IN FAVOR
OF ANY OTHER CREDITOR OR PERSON THAT MAY MATERIALLY AFFECT ANY OF BORROWER'S
PROPERTY OR BORROWER'S ABILITY TO REPLAY THIS NOTE OR PERFORM BORROWER'S
OBLIGATIONS UNDER THIS NOTE OR ANY OF THE RELATED DOCUMENTS. (D) ANY
REPRESENTATION OR STATEMENT MADE OR FURNISHED TO LENDER BY BORROWER OR ON
BORROWER'S BEHALF IS FALSE OR MISLEADING IN ANY MATERIAL RESPECT EITHER NOW OR
AT THE TIME MADE OR FURNISHED. (E) BORROWER BECOMES INSOLVENT, A RECEIVER IS
APPOINTED FOR ANY PART OF BORROWER'S PROPERTY, BORROWER MAKES AN ASSIGNMENT FOR
THE BENEFIT OF CREDITORS, OR ANY PROCEEDING IS COMMENCED EITHER BY BORROWER OR
AGAINST BORROWER UNDER ANY BANKRUPTCY OR INSOLVENCY LAWS. (F) ANY CREDITOR TRIED
TO TAKE ANY OF BORROWER'S PROPERTY ON OR IN WHICH LENDER HAS A LIEN OR SECURITY
INTEREST. THIS INCLUDES A GARNISHMENT OF ANY OF BORROWER'S ACCOUNTS WITH LENDER.
(G) ANY GUARANTOR DIES OR ANY OF THE OTHER EVENTS DESCRIBED IN THIS DEFAULT
SECTION OCCURS WITH RESPECT TO ANY GUARANTOR OF THIS NOTE. (H) A MATERIAL
ADVERSE CHANGE OCCURS IN BORROWER'S FINANCIAL CONDITION, OR LENDER BELIEVES THE
PROSPECT OF PAYMENT OR PERFORMANCE OF THE INDEBTEDNESS IS IMPAIRED.

LENDER'S RIGHTS. UPON DEFAULT, LENDER MAY DECLARE THE ENTIRE UNPAID PRINCIPAL
BALANCE ON THIS NOTE AND ALL ACCRUED UNPAID INTEREST IMMEDIATELY DUE, WITHOUT
NOTICE, AND THEN BORROWER WILL PAY THAT AMOUNT. UPON BORROWER'S FAILURE TO PAY
ALL AMOUNTS DECLARED DUE PURSUANT TO THIS SECTION, INCLUDING FAILURE TO PAY UPON
FINAL MATURITY, LENDER, AT ITS OPTION, MAY ALSO, IF PERMITTED UNDER APPLICABLE
LAW, INCREASE THE VARIABLE INTEREST RATE ON THIS NOTE TO 6.5000 PERCENTAGE
POINTS OVER THE INDEX. LENDER MAY HIRE OR PAY SOMEONE ELSE TO HELP COLLECT THIS
NOTE IF BORROWER DOES NOT PAY. BORROWER ALSO WILL PAY LENDER THAT AMOUNT. THIS
INCLUDES, SUBJECT TO ANY LIMITS UNDER APPLICABLE LAW, LENDER'S ATTORNEYS' FEES
AND LENDERS' LEGAL EXPENSES WHETHER OR NOT THERE IS A LAWSUIT, INCLUDING
ATTORNEYS' FEES AND LEGAL EXPENSES FOR BANKRUPTCY PROCEEDINGS (INCLUDING EFFORTS
TO MODIFY OR VACATE ANY AUTOMATIC STAY OR INJUNCTION), APPEALS, AND ANY
ANTICIPATED POST-JUDGMENT COLLECTION SERVICES. BORROWER ALSO WILL PAY ANY COURT
COSTS, IN ADDITION TO ALL OTHER SUMS PROVIDED BY LAW. THIS NOTE HAS BEEN
DELIVERED TO LENDER AND ACCEPTED BY LENDER IN THE STATE OF CALIFORNIA. IF THERE
IS A LAWSUIT, BORROWER AGREES UPON LENDER'S REQUEST TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF ORANGE COUNTY, THE STATE OF CALIFORNIA. THIS NOTE
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA.

RIGHT OF SETOFF. BORROWER GRANTS TO LENDER A CONTRACTUAL POSSESSORY SECURITY
INTEREST IN, AND HEREBY ASSIGNS, CONVEYS, DELIVERS, PLEDGES, AND TRANSFERS TO
LENDER ALL BORROWER'S RIGHT, TITLE AND INTEREST IN AND TO, BORROWER'S ACCOUNTS
WITH LENDER (WHETHER CHECKING, SAVINGS, OR SOME OTHER ACCOUNT), INCLUDING
WITHOUT LIMITATION ALL ACCOUNTS HELD JOINTLY WITH SOMEONE ELSE AND ALL ACCOUNTS
BORROWER MAY OPEN IN THE FUTURE, EXCLUDING HOWEVER ALL IRA AND KEOUGH ACCOUNTS,
AND ALL TRUST ACCOUNTS FOR WHICH THE GRANT OF A SECURITY INTEREST WOULD BE
PROHIBITED BY LAW. BORROWER AUTHORIZES LENDER, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, TO CHARGE OR SETOFF ALL SUMS OWING ON THIS NOTE AGAINST ANY AND
ALL SUCH ACCOUNTS.

COLLATERAL. THIS NOTE IS SECURED BY A SECURITY AGREEMENT DATED APRIL 19, 1996.

LINE OF CREDIT. THIS NOTE EVIDENCES A STRAIGHT LINE OF CREDIT. ONCE THE TOTAL
AMOUNT OF PRINCIPAL HAS BEEN ADVANCED, BORROWER IS NOT ENTITLED TO FURTHER LOAN
ADVANCE. ADVANCES UNDER THIS NOTE MAY BE REQUESTED EITHER ORALLY OR IN WRITING
BY BORROWER OR BY AN AUTHORIZED PERSON. LENDER MAY, BUT NEED NOT REQUIRE THAT
ALL ORAL REQUESTS BE CONFIRMED IN WRITING. ALL COMMUNICATIONS, INSTRUCTIONS, OR
DIRECTIONS BY TELEPHONE OR OTHERWISE TO LENDER ARE TO BE DIRECTED TO LENDER'S
OFFICE SHOWN ABOVE. THE FOLLOWING PARTY OR PARTIES ARE AUTHORIZED TO REQUEST
ADVANCES UNDER THE LINE
20
04-19-1996 PROMISSORY NOTE PAGE 2
LOAN NO. 13678 (CONTINUED)

OF CREDIT UNTIL LENDER RECEIVES FROM BORROWER AT LENDER'S ADDRESS SHOWN ABOVE
WRITTEN NOTICE OF REVOCATION OF THEIR AUTHORITY: BOYD CODDINGTON AND STAN CLARK.
BORROWER AGREES TO BE LIABLE FOR ALL SUMS EITHER: (A) ADVANCED IN ACCORDANCE
WITH THE INSTRUCTIONS OF AN AUTHORIZED PERSON OR (B) CREDITED TO ANY OF
BORROWER'S ACCOUNTS WITH LENDER. THE UNPAID PRINCIPAL BALANCE OWING ON THIS NOTE
AT ANY TIME MAY BE EVIDENCED BY ENDORSEMENTS ON THIS NOTE OR BY LENDER'S
INTERNAL RECORDS, INCLUDING DAILY COMPUTER PRINT-OUTS. LENDER WILL HAVE NO
OBLIGATION TO ADVANCE FUNDS UNDER THIS NOTE IF: (A) BORROWER OR ANY GUARANTOR IS
IN DEFAULT UNDER THE TERMS OF THIS NOTE OR ANY AGREEMENT THAT BORROWER OR ANY
GUARANTOR HAS WITH LENDER, INCLUDING ANY AGREEMENT MADE IN CONNECTION WITH THE
SIGNING OF THIS NOTE; (B) BORROWER OR ANY GUARANTOR CEASES DOING BUSINESS OR IS
INSOLVENT; (C) ANY GUARANTOR SEEKS, CLAIMS OR OTHERWISE ATTEMPTS TO LIMIT,
MODIFY OR REVOKE SUCH GUARANTOR'S GUARANTEE OF THIS NOTE OR ANY OTHER LOAN WITH
LENDER; OR (D) BORROWER HAS APPLIED FUNDS PROVIDED PURSUANT TO THIS NOTE FOR
PURPOSES OTHER THAN THOSE AUTHORIZED BY LENDER.

GENERAL PROVISIONS. THIS NOTE IS PAYABLE ON DEMAND. THE INCLUSION OF SPECIFIC
DEFAULT PROVISIONS OR RIGHTS OF LENDER SHALL NOT PRECLUDE LENDER'S RIGHT TO
DECLARE PAYMENT OF THIS NOTE ON ITS DEMAND. LENDER MAY DELAY OR FORGO ENFORCING
ANY OF ITS RIGHTS OR REMEDIES UNDER THIS NOTE WITHOUT LOSING THEM. BORROWER AND
ANY OTHER PERSON WHO SIGNS, GUARANTEES OR ENDORSES THIS NOTE, TO THE EXTENT
ALLOWED BY LAW, WAIVE ANY APPLICABLE STATUTE OF LIMITATIONS, PRESENTMENT, DEMAND
FOR PAYMENT, PROTEST AND NOTICE OF DISHONOR. UPON ANY CHANGE IN THE TERMS OF
THIS NOTE, AND UNLESS OTHERWISE EXPRESSLY STATED IN WRITING, NO PARTY WHO SIGNS
THIS NOTE, WHETHER AS MAKER, GUARANTOR, ACCOMMODATION MAKE OR ENDORSER, SHALL BE
RELEASED FROM LIABILITY. ALL SUCH PARTIES AGREE THAT LENDER MAY RENEW OR EXTEND
(REPEATEDLY AND FOR ANY LENGTH OF TIME) THIS LOAN, OR RELEASE ANY PARTY OR
GUARANTOR OR COLLATERAL; OR IMPAIR, FAIL TO REALIZE UPON OR PERFECT LENDER'S
SECURITY INTEREST IN THE COLLATERAL; AND TAKE ANY OTHER ACTION DEEMED NECESSARY
BY LENDER WITHOUT THE CONSENT OF OR NOTICE TO ANYONE. ALL SUCH PARTIES ALSO
AGREE THAT LENDER MAY MODIFY THIS LOAN WITHOUT THE CONSENT OF OR NOTICE TO
ANYONE OTHER THAN THE PARTY WITH WHOM THE MODIFICATION IS MADE.

BORROWER:

BOYD'S WHEELS, INC.

BY: /s/ BOYD CODDINGTON
----------------------
BOYD CODDINGTON, CEO

COMMERCIAL SECURITY AGREEMENT

$1,000,000.00 04-19-1996 05-01-1997 13678 511 055 104121 GG1
- ------------------------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN
OR ITEM.
- ------------------------------------------------------------------------------------------------------------------------------------

BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17762 E. 17TH STREET
TUSTIN, CA 92680

DEFINITIONS. THE FOLLOWING WORDS SHALL HAVE THE FOLLOWING MEANINGS WHEN USED IN
THIS AGREEMENT. TERMS NOT OTHERWISE DEFINED IN THIS AGREEMENT SHALL HAVE THE
MEANINGS ATTRIBUTED TO SUCH TERMS IN THE UNIFORM COMMERCIAL CODE. ALL REFERENCES
TO DOLLAR AMOUNTS SHALL MEAN AMOUNTS IN LAWFUL MONEY OF THE UNITED STATES OF
AMERICA.

AGREEMENT. THE WORD "AGREEMENT" MEANS THIS COMMERCIAL SECURITY AGREEMENT,
AS THIS COMMERCIAL SECURITY AGREEMENT MAY BE AMENDED OR MODIFIED FROM TIME
TO TIME, TOGETHER WITH ALL EXHIBITS AND SCHEDULES ATTACHED TO THIS
COMMERCIAL SECURITY AGREEMENT FROM TIME TO TIME.

COLLATERAL. THE WORD "COLLATERAL" MEANS THE FOLLOWING DESCRIBED PROPERTY
OF GRANTOR, WHETHER NOW OWNED OR HEREAFTER ACQUIRED, WHETHER NOW EXISTING
OR HEREAFTER ARISING, AND WHEREVER LOCATED:

AS SECURITY FOR ALL PRESENTLY EXISTING OR HEREAFTER ARISING
OBLIGATIONS OF DEBTOR TO OR TO SECURED PARTY, DEBTOR HEREBY GRANTS
TO SECURED PARTY A SECURITY INTEREST IN: ALL PROPERTY IN WHICH A
SECURITY INTEREST CAN BE GRANTED PURSUANT TO THE CALIFORNIA
COMMERCIAL CODE, WHICH PROPERTY INCLUDES, BUT IS NOT LIMITED TO, ALL
PRESENTLY EXISTING OR HEREAFTER ARISING, NOW OWNED OR HEREAFTER
ACQUIRED INVENTORY, EQUIPMENT, ACCOUNTS, CONTRACT RIGHTS, CHATTEL
PAPER, DOCUMENTS, INSTRUMENTS, GOODS, GENERAL INTANGIBLES, DEPOSIT
ACCOUNTS AND MONEY.

IN ADDITION, THE WORD "COLLATERAL" INCLUDES ALL THE FOLLOWING, WHETHER NOW
OWNED OR HEREAFTER ACQUIRED, WHETHER NOW EXISTING OR HEREAFTER ARISING,
AND WHEREVER LOCATED:

(A) ALL ATTACHMENTS, ACCESSIONS, ACCESSORIES, TOOLS, PARTS,
SUPPLIES, INCREASES, AND ADDITIONS TO AND ALL REPLACEMENTS OF AND
SUBSTITUTIONS FOR ANY PROPERTY DESCRIBED ABOVE.

(B) ALL PRODUCTS AND PRODUCE OF ANY OF THE PROPERTY DESCRIBED IN
THIS COLLATERAL SECTION.

(C) ALL ACCOUNTS, GENERAL INTANGIBLES, INSTRUMENTS, RENTS, MONIES,
PAYMENTS, AND ALL OTHER RIGHTS, ARISING OUT OF A SALE, LEASE, OR
OTHER DISPOSITION OF ANY OF THE PROPERTY DESCRIBED IN THIS
COLLATERAL SECTION.

(D) ALL PROCEEDS (INCLUDING INSURANCE PROCEEDS) FROM THE SALE,
DESTRUCTION, LOSS, OR OTHER DISPOSITION OF ANY OF THE PROPERTY
DESCRIBED IN THIS COLLATERAL SECTION.

(E) ALL RECORDS AND DATA RELATING TO ANY OF THE PROPERTY DESCRIBED
IN THIS COLLATERAL SECTION, WHETHER IN THE FORM OF A WRITING,
PHOTOGRAPH, MICROFILM, MICROFICHE, OR ELECTRONIC MEDIA, TOGETHER
WITH ALL OF GRANTOR'S RIGHT, TITLE, AND INTEREST IN AND TO ALL
COMPUTER SOFTWARE REQUIRED TO UTILIZE, CREATE, MAINTAIN, AND PROCESS
ANY SUCH RECORDS OR DATA ON ELECTRONIC MEDIA.

EVENT OF DEFAULT. THE WORDS "EVENT OF DEFAULT" MEAN AND INCLUDE WITHOUT
LIMITATION ANY OF THE EVENTS OF DEFAULT SET FORTH BELOW IN THE SECTION
TITLED "EVENTS OF DEFAULT."

GRANTOR. THE WORD "GRANTOR" MEANS BOYD'S WHEELS, INC., IT SUCCESSORS AND
ASSIGNS.

GUARANTOR. THE WORD "GUARANTOR" MEANS AND INCLUDES WITHOUT LIMITATION EACH
AND ALL OF THE GUARANTORS, SURETIES, AND ACCOMMODATION PARTIES IN
CONNECTION WITH THE INDEBTEDNESS.

INDEBTEDNESS. THE WORD "INDEBTEDNESS" MEANS THE INDEBTEDNESS EVIDENCED BY
THE NOTE, INCLUDING ALL PRINCIPAL AND INTEREST, TOGETHER WITH ALL OTHER
INDEBTEDNESS AND COSTS AND EXPENSES FOR WHICH GRANTOR IS RESPONSIBLE UNDER
THIS AGREEMENT OR UNDER ANY OF THE RELATED DOCUMENTS.

LENDER. THE WORD "LENDER" MEANS ELDORADO BANK, ITS SUCCESSORS AND ASSIGNS.

NOTE. THE WORD "NOTE" MEANS THE NOTE OR CREDIT AGREEMENT DATED APRIL 19,
1996, IN THE PRINCIPAL AMOUNT OF $1,000,000.00 FROM BOYD'S WHEELS, INC. TO
LENDER, TOGETHER WITH ALL RENEWALS OF, EXTENSIONS OF, MODIFICATIONS OF,
REFINANCINGS OF, CONSOLIDATIONS OF AND SUBSTITUTIONS FOR THE NOTE OR
CREDIT AGREEMENT.

RELATED DOCUMENTS. THE WORDS "RELATED DOCUMENTS" MEAN AND INCLUDE WITHOUT
LIMITATION ALL PROMISSORY NOTES, CREDIT AGREEMENTS, LOAN AGREEMENTS,
ENVIRONMENTAL AGREEMENTS, GUARANTEES, SECURITY AGREEMENTS, MORTGAGES,
DEEDS OF TRUST, AND ALL OTHER INSTRUMENTS, AGREEMENTS AND DOCUMENTS,
WHETHER NOW OR HEREAFTER EXISTING, EXECUTED IN CONNECTION WITH THE
INDEBTEDNESS.

RIGHT OF SETOFF. GRANTOR HEREBY GRANTS LENDER A CONTRACTUAL POSSESSORY SECURITY
INTEREST IN AND HEREBY ASSIGNS, CONVEYS, DELIVERS, PLEDGES, AND TRANSFERS ALL OF
GRANTOR'S RIGHT, TITLE AND INTEREST IN AND TO GRANTOR'S ACCOUNTS WITH LENDER
(WHETHER CHECKING, SAVINGS, OR SOME OTHER ACCOUNT), INCLUDING ALL ACCOUNTS HELD
JOINTLY WITH SOMEONE ELSE AND ALL ACCOUNTS GRANTOR MAY OPEN IN THE FUTURE,
EXCLUDING, HOWEVER, ALL IRA AND KEOGH ACCOUNTS, AND ALL TRUST ACCOUNTS FOR WHICH
THE GRANT OF A SECURITY INTEREST WOULD BE PROHIBITED BY LAW. GRANTOR AUTHORIZES
LENDER, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TO CHARGE OR SETOFF ALL
INDEBTEDNESS AGAINST ANY AND ALL SUCH ACCOUNTS.

OBLIGATIONS OF GRANTOR. GRANTOR WARRANTS AND COVENANTS TO LENDER AS FOLLOWS:

PERFECTION OF SECURITY INTEREST. GRANTOR AGREES TO EXECUTE SUCH FINANCING
STATEMENTS AND TO TAKE WHATEVER OTHER ACTIONS ARE REQUESTED BY LENDER TO
PERFECT AND CONTINUE LENDER'S SECURITY INTEREST IN THE COLLATERAL. UPON
REQUEST OF LENDER, GRANTOR WILL DELIVER TO LENDER ANY AND ALL OF THE
DOCUMENTS EVIDENCING OR CONSTITUTING THE COLLATERAL, AND GRANTOR WILL NOTE
LENDER'S INTEREST UPON ANY AND ALL CHATTEL PAPER IF NOT DELIVERED TO
LENDER FOR POSSESSION BY LENDER. GRANTOR HEREBY APPOINTS LENDER AS ITS
IRREVOCABLE ATTORNEY-IN-FACT FOR THE PURPOSE OF EXECUTING ANY DOCUMENTS
NECESSARY TO PERFECT OR TO CONTINUE THE SECURITY INTEREST GRANTED IN THIS
AGREEMENT. LENDER MAY AT ANY TIME, AND WITHOUT FURTHER AUTHORIZATION FROM
GRANTOR, FILE A CARBON, PHOTOGRAPHIC OR OTHER REPRODUCTION OF ANY
FINANCING STATEMENT OR OF THIS AGREEMENT FOR USE AS A FINANCING STATEMENT.
GRANTOR WILL REIMBURSE LENDER FOR ALL EXPENSES FOR THE PERFECTION AND THE
CONTINUATION OF THE PERFECTION OF LENDER'S SECURITY INTEREST IN THE
COLLATERAL. GRANTOR PROMPTLY WILL NOTIFY LENDER BEFORE ANY CHANGE IN
GRANTOR'S NAME INCLUDING ANY CHANGE TO THE ASSUMED BUSINESS NAMES OF
GRANTOR.

NO VIOLATION. THE EXECUTION AND DELIVERY OF THIS AGREEMENT WILL NOT
VIOLATE ANY LAW OR AGREEMENT GOVERNING GRANTOR OR TO WHICH GRANTOR IS A
PARTY, AND ITS CERTIFICATE OR ARTICLES OF INCORPORATION AND BYLAWS DO NOT
PROHIBIT ANY TERM OR CONDITION OF THIS AGREEMENT.

ENFORCEABILITY OF COLLATERAL. TO THE EXTENT THE COLLATERAL CONSISTS OF
ACCOUNTS, CHATTEL PAPER, OR GENERAL INTANGIBLES, THE COLLATERAL IS
ENFORCEABLE IN ACCORDANCE WITH ITS TERMS, IS GENUINE, AND COMPLIES WITH
APPLICABLE LAWS CONCERNING FORM, CONTENT AND MANNER OF PREPARATION AND
EXECUTION, AND ALL PERSONS APPEARING TO BE OBLIGATED ON THE COLLATERAL
HAVE AUTHORITY AND CAPACITY TO CONTRACT AND ARE IN FACT OBLIGATED AS THEY
APPEAR TO BE ON THE COLLATERAL.

LOCATION OF THE COLLATERAL. GRANTOR, UPON REQUEST OF LENDER, WILL DELIVER
TO LENDER IN FORM SATISFACTORY TO LENDER A SCHEDULE OF REAL PROPERTIES AND
COLLATERAL LOCATIONS RELATING TO GRANTOR'S OPERATIONS, INCLUDING WITHOUT
LIMITATION THE FOLLOWING: (A) ALL REAL PROPERTY OWNED OR BEING PURCHASED
BY GRANTOR; (B) ALL REAL PROPERTY BEING RENTED OR LEASED BY GRANTOR; (C)
ALL STORAGE FACILITIES OWNER, RENTED, LEASED, OR BEING USED BY GRANTOR;
AND (D) ALL OTHER PROPERTIES WHERE COLLATERAL IS OR MAY BE LOCATED. EXCEPT
IN THE ORDINARY COURSE OF ITS BUSINESS, GRANTOR SHALL NOT REMOVE THE
COLLATERAL FROM ITS EXISTING LOCATIONS WITHOUT THE PRIOR WRITTEN CONSENT
OF LENDER.

REMOVAL OF COLLATERAL. GRANTOR SHALL KEEP THE COLLATERAL (OR TO THE EXTENT
THE COLLATERAL CONSISTS OF INTANGIBLE PROPERTY SUCH AS ACCOUNTS, THE
RECORDS CONCERNING THE COLLATERAL) AT GRANTOR'S ADDRESS SHOWN ABOVE, OR AT
SUCH OTHER LOCATIONS AS ARE ACCEPTABLE TO LENDER. EXCEPT IN THE ORDINARY
COURSE OF ITS BUSINESS, INCLUDING THE SALES OF INVENTORY, GRANTOR SHALL
NOT REMOVE THE COLLATERAL FROM ITS EXISTING LOCATIONS
22
04-19-1996 COMMERCIAL SECURITY AGREEMENT PAGE 2
LOAN NO. 13678 (CONTINUED)

WITHOUT THE PRIOR WRITTEN CONSENT OF LENDER. TO THE EXTENT THAT THE
COLLATERAL CONSISTS OF VEHICLES, OR OTHER TITLED PROPERTY, GRANTOR SHALL
NOT TAKE OR PERMIT ANY ACTION WHICH WOULD REQUIRE APPLICATION FOR
CERTIFICATES OF TITLE FOR THE VEHICLES OUTSIDE THE STATE OF CALIFORNIA,
WITHOUT THE PRIOR WRITTEN CONSENT OF LENDER.

TRANSACTIONS INVOLVING COLLATERAL. EXCEPT FOR INVENTORY SOLD OR ACCOUNTS
COLLECTED IN THE ORDINARY COURSE OF GRANTOR'S BUSINESS, GRANTOR SHALL NOT
SELL, OFFER TO SELL, OR OTHERWISE TRANSFER OR DISPOSE OF THE COLLATERAL.
WHILE GRANTOR IS NOT IN DEFAULT UNDER THIS AGREEMENT, GRANTOR MAY SELL
INVENTORY, BUT ONLY IN THE ORDINARY COURSE OF ITS BUSINESS AND ONLY TO
BUYERS WHO QUALIFY AS A BUYER IN THE ORDINARY COURSE OF BUSINESS. A SALE
IN THE ORDINARY COURSE OF GRANTOR'S BUSINESS DOES NOT INCLUDE A TRANSFER
IN PARTIAL OR TOTAL SATISFACTION OF A DEBT OR ANY BULK SALE. GRANTOR SHALL
NOT PLEDGE, MORTGAGE, ENCUMBER OR OTHERWISE PERMIT THE COLLATERAL TO BE
SUBJECT TO ANY LIEN, SECURITY INTEREST, ENCUMBRANCE, OR CHARGE, OTHER THAN
THE SECURITY INTEREST PROVIDED FOR IN THIS AGREEMENT, WITHOUT THE PRIOR
WRITTEN CONSENT OF LENDER. THIS INCLUDES SECURITY INTERESTS EVEN IF JUNIOR
IN RIGHT TO THE SECURITY INTERESTS GRANTED UNDER THIS AGREEMENT. UNLESS
WAIVED BY LENDER, ALL PROCEEDS FROM ANY DISPOSITION OF THE COLLATERAL (FOR
WHATEVER REASON) SHALL BE HELD IN TRUST FOR LENDER AND SHALL NOT BE
COMMINGLED WITH ANY OTHER FUNDS; PROVIDED HOWEVER, THIS REQUIREMENT SHALL
NOT CONSTITUTE A CONSENT BY LENDER TO ANY SALE OR OTHER DISPOSITION. UPON
RECEIPT, GRANTOR SHALL IMMEDIATELY DELIVER ANY SUCH PROCEEDS TO LENDER.

TITLE. GRANTOR REPRESENTS AND WARRANTS TO LENDER THAT IT HOLDS GOOD AND
MARKETABLE TITLE TO THE COLLATERAL, FREE AND CLEAR OF ALL LIENS AND
ENCUMBRANCES EXCEPT FOR THE LIEN OF THIS AGREEMENT. NO FINANCING STATEMENT
COVERING ANY OF THE COLLATERAL IS ON FILE IN ANY PUBLIC OFFICE OTHER THAN
THOSE WHICH REFLECT THE SECURITY INTEREST CREATED BY THIS AGREEMENT OR TO
WHICH LENDER HAS SPECIFICALLY CONSENTED. GRANTOR SHALL DEFEND LENDER'S
RIGHTS IN THE COLLATERAL AGAINST THE CLAIMS AND DEMANDS OF ALL OTHER
PERSONS.

COLLATERAL SCHEDULES AND LOCATIONS. INSOFAR AS THE COLLATERAL CONSISTS OF
INVENTORY, GRANTOR SHALL DELIVER TO LENDER, AS OFTEN AS LENDER SHALL
REQUIRE, SUCH LISTS, DESCRIPTIONS, AND DESIGNATIONS OF SUCH COLLATERAL AS
LENDER MAY REQUIRE TO IDENTIFY THE NATURE, EXTENT, AND LOCATION OF SUCH
COLLATERAL. SUCH INFORMATION SHALL BE SUBMITTED FOR GRANTOR AND EACH OF
ITS SUBSIDIARIES OR RELATED COMPANIES.

MAINTENANCE AND INSPECTION OF COLLATERAL. GRANTOR SHALL MAINTAIN ALL
TANGIBLE COLLATERAL IN GOOD CONDITION AND REPAIR. GRANTOR WILL NOT COMMIT
OR PERMIT DAMAGE TO OR DESTRUCTION OF THE COLLATERAL OR ANY PART OF THE
COLLATERAL. LENDER AND ITS DESIGNATED REPRESENTATIVES AND AGENTS SHALL
HAVE THE RIGHT AT ALL REASONABLE TIMES TO EXAMINE, INSPECT, AND AUDIT THE
COLLATERAL WHEREVER LOCATED. GRANTOR SHALL IMMEDIATELY NOTIFY LENDER OF
ALL CASES INVOLVING THE RETURN, REJECTION, REPOSSESSION, LOSS OR DAMAGE OF
OR TO ANY COLLATERAL; OF ANY REQUEST FOR CREDIT OR ADJUSTMENT OR OF ANY
OTHER DISPUTE ARISING WITH RESPECT TO THE COLLATERAL; AND GENERALLY OF ALL
HAPPENINGS AND EVENTS AFFECTING THE COLLATERAL OR THE VALUE OR THE AMOUNT
OF THE COLLATERAL.

TAXES, ASSESSMENTS AND LIENS. GRANTOR WILL PAY WHEN DUE ALL TAXES,
ASSESSMENTS AND LIENS UPON THE COLLATERAL, ITS USE OR OPERATION, UPON THIS
AGREEMENT, UPON ANY PROMISSORY NOTE OR NOTES EVIDENCING THE INDEBTEDNESS,
OR UPON ANY OF THE OTHER RELATED DOCUMENTS. GRANTOR MAY WITHHOLD ANY SUCH
PAYMENT OR MAY ELECT TO CONTEST ANY LIEN IF GRANTOR IS IN GOOD FAITH
CONDUCTING AN APPROPRIATE PROCEEDING TO CONTEST THE OBLIGATION TO PAY AND
SO LONG AS LENDER'S INTEREST IN THE COLLATERAL IS NOT JEOPARDIZED IN
LENDER'S SOLE OPINION. IF THE COLLATERAL IS SUBJECTED TO A LIEN WHICH IS
NOT DISCHARGED WITHIN FIFTEEN (15) DAYS, GRANTOR SHALL DEPOSIT WITH LENDER
CASH, A SUFFICIENT CORPORATE SURETY BOND OR OTHER SECURITY SATISFACTORY TO
LENDER IN AN AMOUNT ADEQUATE TO PROVIDE FOR THE DISCHARGE OF THE LIEN PLUS
ANY INTEREST, COSTS, ATTORNEYS' FEES OR OTHER CHARGES THAT COULD ACCRUE AS
A RESULT OF FORECLOSURE OR SALE OF THE COLLATERAL. IN ANY CONTEST GRANTOR
SHALL DEFEND ITSELF AND LENDER AND SHALL SATISFY ANY FINAL ADVERSE
JUDGMENT BEFORE ENFORCEMENT AGAINST THE COLLATERAL. GRANTOR SHALL NAME
LENDER AS AN ADDITIONAL OBLIGEE UNDER ANY SURETY BOND FURNISHED IN THE
CONTEST PROCEEDINGS.

COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. GRANTOR SHALL COMPLY PROMPTLY
WITH ALL LAWS, ORDINANCES, RULES AND REGULATIONS OF ALL GOVERNMENTAL
AUTHORITIES, NOW OR HEREAFTER IN EFFECT APPLICABLE TO THE OWNERSHIP,
PRODUCTION, DISPOSITION, OR USE OF THE COLLATERAL. GRANTOR MAY CONTEST IN
GOOD FAITH ANY SUCH LAW, ORDINANCE OR REGULATION AND WITHHOLD COMPLIANCE
DURING ANY PROCEEDINGS, INCLUDING APPROPRIATE APPEALS, SO LONG AS LENDER'S
INTEREST IN THE COLLATERAL, IN LENDER'S OPINION, IS NOT JEOPARDIZED.

HAZARDOUS SUBSTANCES. GRANT REPRESENTS AND WARRANT THAT THE COLLATERAL
NEVER HAS BEEN, AND NEVER WILL BE SO LONG AS THIS AGREEMENT REMAINS IN
LIEN ON THE COLLATERAL, USED FOR THE GENERATION, MANUFACTURE, STORAGE,
TRANSPORTATION, TREATMENT, DISPOSAL, RELEASE OR THREATENED RELEASE OF ANY
HAZARDOUS WASTE OR SUBSTANCE, AS THOSE TERMS ARE DEFINED IN THE
COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY ACT OF
1960, AS AMENDED, 42 U.S.C. SECTION 9601, ET SEQ. ("CERCLA"), THE
SUPERFUND AMENDMENTS AND REAUTHORIZATION ACT OF 1986, PUB. L. NO. 99-499
("SARA"), THE HAZARDOUS MATERIALS TRANSPORTATION ACT, 49 U.S.C. SECTION
1801, ET SEQ., THE RESOURCE CONSERVATION AND RECOVERY ACT, 42 U.S.C.
SECTION 6901, ET SEQ., CHAPTERS 6.5 THROUGH 7.7 OF DIVISION 20 OF THE
CALIFORNIA HEALTH AND SAFETY CODE, SECTION 25100 ET SEQ., OR OTHER
APPLICABLE STATE OR FEDERAL LAWS, RULES, OR REGULATIONS ADOPTED PURSUANT
TO ANY OF THE FOREGOING. THE TERMS "HAZARDOUS WASTE" AND "HAZARDOUS
SUBSTANCE" SHALL ALSO INCLUDE WITHOUT LIMITATION, PETROLEUM AND PETROLEUM
BY- PRODUCTS OR ANY FRACTION THEREOF AND ASBESTOS. THE REPRESENTATIONS AND
WARRANTIES CONTAINED HEREIN ARE BASED ON GRANTOR'S DUE DILIGENCE IN
INVESTIGATING THE COLLATERAL FOR HAZARDOUS WASTES AND SUBSTANCES. GRANTOR
HEREBY (A) RELEASES AND WAIVES ANY FUTURE CLAIMS AGAINST LENDER FOR
INDEMNITY OR CONTRIBUTION IN THE EVENT GRANTOR BECOMES LIABLE FOR CLEANUP
OR OTHER COSTS UNDER ANY SUCH LAWS, AND (B) AGREES TO INDEMNIFY AND HOLD
HARMLESS LENDER AGAINST ANY AND ALL CLAIMS AND LOSSES RESULTING FROM A
BREACH OF THIS PROVISION OF THIS AGREEMENT. THIS OBLIGATION TO INDEMNIFY
SHALL SURVIVE THE PAYMENT OF THE INDEBTEDNESS AND THE SATISFACTION OF THIS
AGREEMENT.

MAINTENANCE OF CASUALTY INSURANCE. GRANTOR SHALL PROCURE AND MAINTAIN ALL
RISKS INSURANCE, INCLUDING WITHOUT LIMITATION FIRE, THEFT AND LIABILITY
COVERAGE TOGETHER WITH SUCH OTHER INSURANCE AS LENDER MAY REQUIRE WITH
RESPECT TO THE COLLATERAL, IN FORM, AMOUNTS, COVERAGES AND BASIS
REASONABLY ACCEPTABLE TO LENDER AND ISSUED BY A COMPANY OR COMPANIES
REASONABLY ACCEPTABLE TO LENDER. GRANTOR, UPON REQUEST OF LENDER, WILL
DELIVER TO LENDER FROM TIME TO TIME THE POLICIES OR CERTIFICATES OF
INSURANCE IN FORM SATISFACTORY TO LENDER, INCLUDING STIPULATIONS THAT
COVERAGES WILL NOT BE CANCELLED OR DIMINISHED WITHOUT AT LEAST TEN (10)
DAYS' PRIOR WRITTEN NOTICE TO LENDER AND NOT INCLUDING ANY DISCLAIMER OF
THE INSURER'S LIABILITY FOR FAILURE TO GIVE SUCH A NOTICE. EACH INSURANCE
POLICY ALSO SHALL INCLUDE AN ENDORSEMENT PROVIDING THAT COVERAGE IN FAVOR
OF LENDER WILL NOT BE IMPAIRED IN ANY WAY BY ANY ACT, COMMISSION OR
DEFAULT OF GRANTOR OR ANY OTHER PERSON. IN CONNECTION WITH ALL POLICIES
COVERING ASSETS IN WHICH LENDER HOLDS OR IS OFFERED A SECURITY INTEREST,
GRANTOR WILL PROVIDE LENDER WITH SUCH LOSS PAYABLE OR OTHER ENDORSEMENTS
AS LENDER MAY REQUIRE. IN NO EVENT SHALL THE INSURANCE BE IN AN AMOUNT
LESS THAN THE AMOUNT AGREED UPON IN THE AGREEMENT TO PROVIDE INSURANCE. IF
GRANTOR AT ANY TIME FAILS TO OBTAIN OR MAINTAIN ANY INSURANCE AS REQUIRED
UNDER THIS AGREEMENT, LENDER MAY (BUT SHALL NOT BE OBLIGATED TO) OBTAIN
SUCH INSURANCE AS LENDER DEEMS APPROPRIATE, INCLUDING IF IT SO CHOOSES
"SINGLE INTEREST INSURANCE," WHICH WILL COVER ONLY LENDER'S INTEREST IN
THE COLLATERAL.

APPLICATION OF INSURANCE PROCEEDS. GRANTOR SHALL PROMPTLY NOTIFY LENDER OF
ANY LOSS OR DAMAGE TO THE COLLATERAL. LENDER MAY MAKE PROOF OF LOSS IF
GRANTOR FAILS TO DO SO WITHIN FIFTEEN (15) DAYS OF THE CASUALTY. ALL
PROCEEDS OF ANY INSURANCE ON THE COLLATERAL, INCLUDING ACCRUED PROCEEDS
THEREON, SHALL BE HELD BY LENDER AS PART OF THE COLLATERAL. IF LENDER
CONSENTS TO REPAIR OR REPLACEMENT OF THE DAMAGED OR DESTROYED COLLATERAL,
LENDER SHALL, UPON SATISFACTORY EXPENDITURE, PAY OR REIMBURSE GRANTOR FROM
THE PROCEEDS FOR THE REASONABLE COST OF REPAIR OR RESTORATION. IF LENDER
DOES NOT CONSENT TO REPAIR OR REPLACEMENT OF THE COLLATERAL, LENDER SHALL
RETAIN A SUFFICIENT AMOUNT OF THE PROCEEDS TO PAY ALL OF THE INDEBTEDNESS,
AND SHALL PAY THE BALANCE TO GRANTOR. ANY PROCEEDS WHICH HAVE NOT BEEN
DISBURSED WITHIN SIX (6) MONTHS AFTER THEIR RECEIPT AND WHICH GRANTOR HAS
NOT COMMITTED TO THE REPAIR OR RESTORATION OF THE COLLATERAL SHALL BE USED
TO REPAY THE INDEBTEDNESS.

INSURANCE RESERVES. LENDER MAY REQUIRE GRANTOR TO MAINTAIN WITH LENDER
RESERVES FOR PAYMENT OF INSURANCE PREMIUMS, WHICH RESERVES SHALL BE
CREATED BY MONTHLY PAYMENTS FROM GRANTOR OF A SUM ESTIMATED BY LENDER TO
BE SUFFICIENT TO PRODUCE, AT LEAST FIFTEEN (15) DAYS BEFORE THE PREMIUM
DUE DATE, AMOUNTS AT LEAST EQUAL TO THE INSURANCE PREMIUMS TO BE PAID. IF
FIFTEEN (15) DAYS BEFORE PAYMENT IS DUE, THE RESERVE FUNDS ARE
INSUFFICIENT, GRANTOR SHALL UPON DEMAND PAY ANY DEFICIENCY TO LENDER. THE
RESERVE FUNDS SHALL BE HELD BY LENDER AS A GENERAL DEPOSIT AND SHALL
CONSTITUTE A NON-INTEREST-BEARING ACCOUNT WHICH LENDER MAY SATISFY BY
PAYMENT OF THE INSURANCE PREMIUMS REQUIRED TO BE PAID BY GRANTOR AS THEY
BECOME DUE. LENDER DOES NOT HOLD THE RESERVE FUNDS IN TRUST FOR GRANTOR,
AND LENDER IS NOT THE AGENT OF GRANTOR FOR PAYMENT OF THE INSURANCE
PREMIUMS REQUIRED TO BE PAID BY GRANTOR. THE RESPONSIBILITY FOR THE
PAYMENT OF PREMIUMS SHALL REMAIN GRANTOR'S SOLE RESPONSIBILITY.

INSURANCE REPORTS. GRANTOR, UPON REQUEST OF LENDER, SHALL FURNISH TO
LENDER REPORTS ON EACH EXISTING POLICY OF INSURANCE SHOWING SUCH
INFORMATION AS LENDER MAY REASONABLY REQUEST INCLUDING THE FOLLOWING: (A)
THE NAME OF THE INSURER; (B) THE RISKS INSURED; (C) THE AMOUNT OF THE
POLICY; (D) THE PROPERTY INSURED; (E) THE THEN CURRENT VALUE ON THE BASIS
OF WHICH INSURANCE HAS BEEN OBTAINED AND THE MANNER OF DETERMINING THAT
VALUE; AND (F) THE EXPIRATION DATE OF THE POLICY. IN ADDITION, GRANTOR
SHALL UPON REQUEST BY LENDER (HOWEVER NOT MORE OFTEN THAN ANNUALLY) HAVE
AN INDEPENDENT APPRAISER SATISFACTORY TO LENDER DETERMINE, AS APPLICABLE,
THE CASH VALUE OR REPLACEMENT COST OF THE COLLATERAL.

GRANTOR'S RIGHT TO POSSESSION. UNTIL DEFAULT, GRANTOR MAY HAVE POSSESSION OF THE
TANGIBLE PERSONAL PROPERTY AND BENEFICIAL USE OF ALL THE COLLATERAL AND MAY USE
IT IN ANY LAWFUL MANNER NOT INCONSISTENT WITH THIS AGREEMENT OR THE RELATED
DOCUMENTS, PROVIDED THAT GRANTOR'S RIGHT TO POSSESSION AND BENEFICIAL USE SHALL
NOT APPLY TO ANY COLLATERAL WHERE POSSESSION OF THE COLLATERAL BY LENDER IS
REQUIRED BY LAW TO PERFECT LENDER'S SECURITY INTEREST IN SUCH COLLATERAL. IF
LENDER AT ANY TIME HAS POSSESSION OF THE COLLATERAL, WHETHER BEFORE OR AFTER AN
EVENT OF DEFAULT, LENDER SHALL BE DEEMED TO HAVE EXERCISED REASONABLE CARE IN
THE CUSTODY AND PRESERVATION OF THE COLLATERAL IF LENDER TAKES SUCH ACTION FOR
THAT PURPOSE AS GRANTOR SHALL REQUEST OR AS LENDER, IN LENDER'S SOLE DISCRETION,
SHALL DEEM APPROPRIATE UNDER THE CIRCUMSTANCES, BUT FAILURE TO HONOR ANY REQUEST
BY GRANTOR SHALL NOT OF IT SELF BE DEEMED TO BE A FAILURE TO EXERCISE REASONABLE
CARE. LENDER SHALL NOT BE REQUIRED TO TAKE ANY STEPS NECESSARY TO PRESERVE ANY
RIGHTS IN THE COLLATERAL AGAINST PRIOR PARTIES, NOR TO PROTECT, PRESERVE OR
MAINTAIN ANY SECURITY INTEREST GIVEN TO SECURE THE INDEBTEDNESS.

EXPENDITURES BY LENDER. IF NOT DISCHARGED OR PAID WHEN DUE, LENDER MAY (BUT
SHALL NOT BE OBLIGATED TO) DISCHARGE OR PAY ANY AMOUNTS REQUIRED TO BE
DISCHARGED OR PAID BY GRANTOR UNDER THIS AGREEMENT, INCLUDING WITHOUT LIMITATION
ALL TAXES, LIENS, SECURITY INTERESTS, ENCUMBRANCES, AND OTHER CLAIMS, AT ANY
TIME LEVIED OR PLACED ON THE COLLATERAL. LENDER ALSO MAY (BUT SHALL NOT BE
OBLIGATED TO) PAY ALL COSTS FOR INSURING, MAINTAINING AND PRESERVING THE
COLLATERAL. ALL SUCH EXPENDITURES INCURRED OR PAID BY LENDER FOR SUCH PURPOSES
WILL THEN BEAR INTEREST AT THE RATE CHARGED UNDER THE NOTE FROM THE DATE
INCURRED OR PAID BY LENDER TO THE DATE OF REPAYMENT BY GRANTOR. ALL SUCH
EXPENSES SHALL BECOME A PART OF THE INDEBTEDNESS AND, AT LENDER'S OPTION, WILL
(A) BE PAYABLE ON DEMAND, (B) BE ADDED TO THE BALANCE OF THE NOTE AND BE
APPORTIONED AMONG
23
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LOAN NO. 13678 (CONTINUED)

AND BE PAYABLE WITH ANY INSTALLMENT PAYMENTS TO BECOME DUE DURING EITHER (I) THE
TERMS OF ANY APPLICABLE INSURANCE POLICY OR (II) THE REMAINING TERMS OF THE
NOTE, OR (C) BE TREATED AS A BALLOON PAYMENT WHICH WILL BE DUE AND PAYABLE AT
THE NOTE'S MATURITY. THIS AGREEMENT ALSO WILL SECURE PAYMENT OF THESE AMOUNTS.
SUCH RIGHT SHALL BE IN ADDITION TO ALL OTHER RIGHTS AND REMEDIES TO WHICH LENDER
MAY BE ENTITLED UPON THE OCCURRENCE OF AN EVENT OF DEFAULT.

EVENTS OF DEFAULT. EACH OF THE FOLLOWING SHALL CONSTITUTE AN EVENT OF DEFAULT
UNDER THIS AGREEMENT:

DEFAULT ON INDEBTEDNESS. FAILURE OF GRANTOR TO MAKE ANY PAYMENT WHEN DUE
ON THE INDEBTEDNESS.

OTHER DEFAULTS. FAILURE OF GRANTOR TO COMPLY WITH OR TO PERFORM ANY OTHER
TERM, OBLIGATION, COVENANT OR CONDITION CONTAINED IN THIS AGREEMENT OR IN
ANY OF THE RELATED DOCUMENTS OR IN ANY OTHER AGREEMENT BETWEEN LENDER AND
GRANTOR.

DEFAULT IN FAVOR OF THIRD PARTIES. SHOULD BORROWER OR ANY GRANTOR DEFAULT
UNDER ANY LOAN, EXTENSION OF CREDIT, SECURITY AGREEMENT, PURCHASE OF SALES
AGREEMENT, OR ANY OTHER AGREEMENT, IN FAVOR OF ANY OTHER CREDITOR OR
PERSON THAT MAY MATERIALLY AFFECT ANY OF BORROWER'S PROPERTY OR BORROWER'S
OR ANY GRANTOR'S ABILITY TO REPAY THE LOANS OR PERFORM THEIR RESPECTIVE
OBLIGATIONS UNDER THIS AGREEMENT OR ANY OF THE RELATED DOCUMENTS.

FALSE STATEMENTS. ANY WARRANTY, REPRESENTATION OR STATEMENT MADE OR
FURNISHED TO LENDER BY OR ON BEHALF OF GRANTOR UNDER THIS AGREEMENT, THE
NOTE OR THE RELATED DOCUMENTS IS FALSE OR MISLEADING IN ANY MATERIAL
RESPECT, EITHER NOW OR AT THE TIME MADE OR FURNISHED.

DEFECTIVE COLLATERALIZATION. THIS AGREEMENT OR ANY OF THE RELATED
DOCUMENTS CEASES TO BE IN FULL FORCE AND EFFECT (INCLUDING FAILURE OF ANY
COLLATERAL DOCUMENTS TO CREATE A VALID AND PERFECTED SECURITY INTEREST OR
LIEN) AT ANY TIME AND FOR ANY REASON.

INSOLVENCY. THE DISSOLUTION OR TERMINATION OF GRANTOR'S EXISTENCE AS A
GOING BUSINESS, THE INSOLVENCY OF GRANTOR, THE APPOINTMENT OF A RECEIVER
FOR ANY PART OF GRANTOR'S PROPERTY, ANY ASSIGNMENT FOR THE BENEFIT OF
CREDITORS, ANY TYPE OF CREDITOR WORKOUT, OR THE COMMENCEMENT OF ANY
PROCEEDING UNDER ANY BANKRUPTCY OR INSOLVENCY LAWS BY OR AGAINST GRANTOR.

CREDITOR OR FORFEITURE PROCEEDINGS. COMMENCEMENT OF FORECLOSURE OR
FORFEITURE PROCEEDINGS, WHETHER BY JUDICIAL PROCEEDING, SELF-HELP,
REPOSSESSION OR ANY OTHER METHOD, BY ANY CREDITOR OF GRANTOR OR BY ANY
GOVERNMENTAL AGENCY AGAINST THE COLLATERAL OR ANY OTHER COLLATERAL
SECURING THE INDEBTEDNESS. THIS INCLUDES A GARNISHMENT OF ANY GRANTOR'S
DEPOSIT ACCOUNTS WITH LENDER.

EVENTS AFFECTING GUARANTOR. ANY OF THE PRECEDING EVENTS OCCURS WITH
RESPECT TO ANY GUARANTOR OF ANY OF THE INDEBTEDNESS OR SUCH GUARANTOR DIES
OR BECOMES INCOMPETENT.

ADVERSE CHANGE. A MATERIAL ADVERSE CHANGE OCCURS IN GRANTOR'S FINANCIAL
CONDITION, OR LENDER BELIEVES THE PROSPECT OF PAYMENT OR PERFORMANCE OF
THE INDEBTEDNESS IS IMPAIRED.

INSECURITY. LENDER, IN GOOD FAITH, DEEMS ITSELF INSECURE.

RIGHTS AND REMEDIES ON DEFAULT. IF AN EVENT OF DEFAULT OCCURS UNDER THIS
AGREEMENT, AT ANY TIME THEREAFTER, LENDER SHALL HAVE THE RIGHTS OF A SECURED
PARTY UNDER THE CALIFORNIA UNIFORM COMMERCIAL CODE. IN ADDITION AND WITHOUT
LIMITATION, LENDER MAY EXERCISE ANY ONE OR MORE OF THE FOLLOWING RIGHT AND
REMEDIES:

ACCELERATE INDEBTEDNESS. LENDER MAY DECLARE THE ENTIRE INDEBTEDNESS,
INCLUDING ANY PREPAYMENT PENALTY WHICH GRANTOR WOULD BE REQUIRED TO PAY,
IMMEDIATELY DUE AND PAYABLE, WITHOUT NOTICE.

ASSEMBLE COLLATERAL. LENDER MAY REQUIRE GRANTOR TO DELIVER TO LENDER ALL
OR ANY PORTION OF THE COLLATERAL AND ANY AND ALL CERTIFICATES OF TITLE AND
OTHER DOCUMENTS RELATING TO THE COLLATERAL. LENDER MAY REQUIRE GRANTOR TO
ASSEMBLE THE COLLATERAL AND MAKE IT AVAILABLE TO LENDER AT A PLACE TO BE
DESIGNATED BY LENDER. LENDER ALSO SHALL HAVE FULL POWER TO ENTER UPON THE
PROPERTY OF GRANTOR TO TAKE POSSESSION OF AND REMOVE THE COLLATERAL. IF
THE COLLATERAL CONTAINS OTHER GOODS NOT COVERED BY THIS AGREEMENT AT THE
TIME REPOSSESSION, GRANTOR AGREES LENDER MAY TAKE SUCH OTHER GOODS,
PROVIDED THAT LENDER MAKES REASONABLE EFFORTS TO RETURN THEM TO GRANTOR
AFTER REPOSSESSION.

SELL THE COLLATERAL. LENDER SHALL HAVE FULL POWER TO SELL, LEASE,
TRANSFER, OR OTHERWISE DEAL WITH THE COLLATERAL OR PROCEEDS THEREOF IN IT
OWN NAME OR THAT OF GRANTOR. LENDER MAY SELL THE COLLATERAL AT PUBLIC
AUCTION OR PRIVATE SALE. UNLESS THE COLLATERAL THREATENS TO DECLINE
SPEEDILY IN VALUE OR IS OF A TYPE CUSTOMARILY SOLD ON A RECOGNIZED MARKET,
LENDER WILL GIVE GRANTOR REASONABLE NOTICE OF THE TIME AFTER WHICH ANY
PRIVATE SALE OR ANY OTHER INTENDED DISPOSITION OF THE COLLATERAL IS TO BE
MADE. THE REQUIREMENTS OF REASONABLE NOTICE SHALL BE MET IF SUCH NOTICE IS
GIVEN AT LEAST TEN (10) DAYS, OR SUCH LESSER TIME AS REQUIRED BY STATE
LAW, BEFORE THE TIME OF THE SALE OR DISPOSITION. ALL EXPENSES RELATING TO
THE DISPOSITION OF THE COLLATERAL, INCLUDING WITHOUT LIMITATION THE
EXPENSES OF RETAKING, HOLDING, INSURING, PREPARING FOR SALE AND SELLING
THE COLLATERAL, SHALL BECOME A PART OF THE INDEBTEDNESS SECURED BY THIS
AGREEMENT AND SHALL BE PAYABLE ON DEMAND, WITH INTEREST AT THE NOTE RATE
FROM DATE OF EXPENDITURE UNTIL REPAID.

OBTAIN DEFICIENCY. IF LENDER CHOOSES TO SELL ANY OR ALL OF THE COLLATERAL,
LENDER MAY OBTAIN A JUDGMENT AGAINST GRANTOR FOR ANY DEFICIENCY REMAINING
ON THE INDEBTEDNESS DUE TO LENDER AFTER APPLICATION OF ALL AMOUNTS
RECEIVED FROM THE EXERCISE OF THE RIGHTS PROVIDED IN THIS AGREEMENT.
GRANTOR SHALL BE LIABLE FOR A DEFICIENCY EVEN IF THE TRANSACTION DESCRIBED
IN THIS SUBSECTION IS A SALE OF ACCOUNTS OR CHATTEL PAPER.

OTHER RIGHTS AND REMEDIES. LENDER SHALL HAVE ALL THE RIGHTS AND REMEDIES
OF A SECURED CREDITOR UNDER THE PROVISIONS OF THE UNIFORM COMMERCIAL CODE,
AS MAY BE AMENDED FROM TIME TO TIME. IN ADDITION, LENDER SHALL HAVE AND
MAY EXERCISE ANY OR ALL OTHER RIGHTS AND REMEDIES IT MAY HAVE AVAILABLE AT
LAW, IN EQUITY, OR OTHERWISE.

CUMULATIVE REMEDIES. ALL OF LENDER'S RIGHTS AND REMEDIES, WHETHER
EVIDENCED BY THIS AGREEMENT OR THE RELATED DOCUMENTS OR BY ANY OTHER
WRITING, SHALL BE CUMULATIVE AND MAY BE EXERCISED SINGULARLY OR
CONCURRENTLY. ELECTION BY LENDER TO PURSUE ANY REMEDY SHALL NOT EXCLUDE
PURSUIT OF ANY OTHER REMEDY, AND AN ELECTION TO MAKE EXPENDITURES OR TO
TAKE ACTION TO PERFORM AN OBLIGATION OF GRANTOR UNDER THIS AGREEMENT,
AFTER GRANTOR'S FAILURE TO PERFORM, SHALL NOT AFFECT LENDER'S RIGHT TO
DECLARE A DEFAULT AND TO EXERCISE ITS REMEDIES.

MISCELLANEOUS PROVISIONS. THE FOLLOWING MISCELLANEOUS PROVISIONS ARE A PART OF
THIS AGREEMENT:

AMENDMENTS. THIS AGREEMENT, TOGETHER WITH ANY RELATED DOCUMENTS,
CONSTITUTES THE ENTIRE UNDERSTANDING AND AGREEMENT OF THE PARTIES AS TO
THE MATTERS SET FORTH IN THIS AGREEMENT. NO ALTERATION OF OR AMENDMENT TO
THIS AGREEMENT SHALL BE EFFECTIVE UNLESS GIVEN IN WRITING AND SIGNED BY
THE PARTY OR PARTIES SOUGHT TO BE CHARGED OR BOUND BY THE ALTERATION OR
AMENDMENT.

APPLICABLE LAW. THIS AGREEMENT HAS BEEN DELIVERED TO LENDER AND ACCEPTED
BY LENDER IN THE STATE OF CALIFORNIA. IF THERE IS A LAWSUIT, GRANTOR
AGREES UPON LENDER'S REQUEST TO SUBMIT TO THE JURISDICTION OF THE COURTS
OF ORANGE COUNTY, STATE OF CALIFORNIA. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

ATTORNEYS' FEES; EXPENSES. GRANTOR AGREES TO PAY UPON DEMAND ALL OF
LENDER'S COSTS AND EXPENSES, INCLUDING ATTORNEYS' FEES AND LENDER'S LEGAL
EXPENSES, INCURRED IN CONNECTION WITH THE ENFORCEMENT OF THIS AGREEMENT.
LENDER MAY PAY SOMEONE ELSE TO HELP ENFORCE THIS AGREEMENT AND GRANTOR
SHALL PAY THE COSTS AND EXPENSES OF SUCH ENFORCEMENT. COSTS AND EXPENSES
INCLUDE LENDER'S ATTORNEYS' FEES AND LEGAL EXPENSES WHETHER OR NOT THERE
IS A LAWSUIT, INCLUDING ATTORNEYS' FEES AND LEGAL EXPENSES FOR BANKRUPTCY
PROCEEDINGS (AND INCLUDING EFFORTS TO MODIFY OR VACATE ANY AUTOMATIC STAY
OR INJUNCTION), APPEALS, AND ANY ANTICIPATED POST-JUDGMENT COLLECTION
SERVICES. GRANTOR ALSO SHALL PAY ALL COURT COSTS AND SUCH ADDITIONAL FEES
AS MAY BE DIRECTED BY THE COURT.

CAPTION HEADINGS. CAPTION HEADINGS IN THIS AGREEMENT ARE FOR CONVENIENCE
PURPOSES ONLY AND ARE NOT TO BE USED TO INTERPRET OR DEFINE THE PROVISIONS
OF THIS AGREEMENT.

MULTIPLE PARTIES; CORPORATE AUTHORITY. ALL OBLIGATIONS OF GRANTOR UNDER
THIS AGREEMENT SHALL BE JOINT AND SEVERAL, AND ALL REFERENCES TO GRANTOR
SHALL MEAN EACH AND EVERY GRANTOR. THIS MEANS THAT EACH OF THE BORROWERS
SIGNING BELOW IS RESPONSIBLE FOR ALL OBLIGATIONS IN THIS AGREEMENT.

NOTICES. ALL NOTICES REQUIRED TO BE GIVEN UNDER THIS AGREEMENT SHALL BE
GIVEN IN WRITING, MAY BE SENT BY TELEFACSIMILIE, AND SHALL BE EFFECTIVE
WHEN ACTUALLY DELIVERED OR WHEN DEPOSITED WITH A NATIONALLY RECOGNIZED
OVERNIGHT COURIER OR DEPOSITED IN THE UNITED STATES MAIL, FIRST CLASS,
POSTAGE PREPAID, ADDRESSED TO THE PARTY TO WHOM THE NOTICE IS TO BE GIVEN
AT THE ADDRESS SHOWN ABOVE. ANY PARTY MAY CHANGE ITS ADDRESS FOR NOTICES
UNDER THIS AGREEMENT BY GIVING FORMAL WRITTEN NOTICE TO THE OTHER PARTIES,
SPECIFYING THAT THE PURPOSE OF THE NOTICE IS TO CHANGE THE PARTY'S
ADDRESS. TO THE EXTENT PERMITTED BY APPLICABLE LAW, IF THERE IS MORE THAN
ONE GRANTOR, NOTICE TO ANY GRANTOR WILL CONSTITUTE NOTICE TO ALL GRANTORS.
FOR NOTICE PURPOSES, GRANTOR WILL KEEP LENDER INFORMED AT ALL TIMES OF
GRANTOR'S CURRENT ADDRESS(ES).

POWER OF ATTORNEY. GRANTOR HEREBY APPOINTS LENDER AS ITS TRUE AND LAWFUL
ATTORNEY-IN-FACT, IRREVOCABLY, WITH FULL POWER OF SUBSTITUTION TO DO THE
FOLLOWING: (A) TO DEMAND, COLLECT, RECEIVE, RECEIPT FOR, SUE AND RECOVER
ALL SUMS OF MONEY OR OTHER PROPERTY WHICH MAY NOW OR HEREAFTER BECOME DUE,
OWING OR PAYABLE FROM THE COLLATERAL; (B) TO EXECUTE, SIGN AND ENDORSE ANY
AND ALL CLAIMS, INSTRUMENTS, RECEIPTS, CHECKS, DRAFTS OR WARRANTS ISSUED
IN PAYMENT FOR THE COLLATERAL; (C) TO SETTLE OR COMPROMISE ANY AND ALL
CLAIMS ARISING UNDER THE COLLATERAL, AND, IN THE PLACE AND STEAD OF
GRANTOR, TO EXECUTE AND DELIVER ITS RELEASE AND SETTLEMENT FOR THE CLAIM;
AND (D) TO FILE ANY CLAIM OR CLAIMS OR TO TAKE ANY ACTION OR INSTITUTE OR
TAKE PART IN ANY PROCEEDINGS, EITHER IN ITS OWN NAME OR IN THE NAME OF
GRANTOR, OR OTHERWISE, WHICH IN THE DISCRETION OF LENDER MAY SEEM TO BE
NECESSARY OR ADVISABLE. THIS POWER IS GIVEN AS SECURITY FOR THE
INDEBTEDNESS, AND THE AUTHORITY HEREBY CONFERRED IS AND SHALL BE
IRREVOCABLE AND SHALL REMAIN IN FULL FORCE AND EFFECT UNTIL RENOUNCED BY
LENDER.
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LOAN NO. 13678 (CONTINUED)

PREFERENCE PAYMENTS. ANY MONIES LENDER PAYS BECAUSE OF AN ASSERTED
PREFERENCE CLAIM IN BORROWER'S BANKRUPTCY WILL BECOME A PART OF THE
INDEBTEDNESS AND, AT LENDER'S OPTION, SHALL BE PAYABLE BY BORROWER AS
PROVIDED ABOVE IN THE "EXPENDITURES BY LENDER" PARAGRAPH.

SEVERABILITY. IF A COURT OF COMPETENT JURISDICTION FINDS ANY PROVISION OF
THIS AGREEMENT TO BE INVALID OR UNENFORCEABLE AS TO ANY PERSON OR
CIRCUMSTANCE, SUCH FINDING SHALL NOT RENDER THAT PROVISION INVALID OR
UNENFORCEABLE AS TO ANY OTHER PERSONS OR CIRCUMSTANCES. IF FEASIBLE, ANY
SUCH OFFENDING PROVISION SHALL BE DEEMED TO BE MODIFIED TO BE WITHIN THE
LIMITS OF ENFORCEABILITY OR VALIDITY; HOWEVER, IF THE OFFENDING PROVISION
CANNOT BE SO MODIFIED, IT SHALL BE STRICKEN AND ALL OTHER PROVISIONS OF
THIS AGREEMENT IN ALL OTHER RESPECTS SHALL REMAIN VALID AND ENFORCEABLE.

SUCCESSOR INTERESTS. SUBJECT TO THE LIMITATIONS SET FORTH ABOVE ON
TRANSFER OF THE COLLATERAL, THIS AGREEMENT SHALL BE BINDING UPON AND INURE
TO THE BENEFIT OF THE PARTIES, THEIR SUCCESSORS AND ASSIGNS.

WAIVER. LENDER SHALL NOT BE DEEMED TO HAVE WAIVED ANY RIGHTS UNDER THIS
AGREEMENT UNLESS SUCH WAIVER IS GIVEN IN WRITING AND SIGNED BY LENDER. NO
DELAY OR OMISSION ON THE PART OF LENDER IN EXERCISING ANY RIGHT SHALL
OPERATE AS A WAIVER OF SUCH RIGHT OR ANY OTHER RIGHT. A WAIVER BY LENDER
OF A PROVISION OF THIS AGREEMENT SHALL NOT PREJUDICE OR CONSTITUTE A
WAIVER OF LENDER'S RIGHT OTHERWISE TO DEMAND STRICT COMPLIANCE WITH THAT
PROVISION OR ANY OTHER PROVISION OF THIS AGREEMENT. NO PRIOR WAIVER BY
LENDER, NOR ANY COURSE OF DEALING BETWEEN LENDER AND GRANTOR, SHALL
CONSTITUTE A WAIVER OF ANY OF LENDER'S RIGHTS OR OF ANY OF GRANTOR'S
OBLIGATIONS AS TO ANY FUTURE TRANSACTIONS. WHENEVER THE CONSENT OF LENDER
IS REQUIRED UNDER THIS AGREEMENT, THE GRANTING OF SUCH CONSENT BY LENDER
IN ANY INSTANCE SHALL NOT CONSTITUTE CONTINUING CONSENT TO SUBSEQUENT
INSTANCES WHERE SUCH CONSENT IS REQUIRED AND IN ALL CASES SUCH CONSENT MAY
BE GRANTED OR WITHHELD IN THE SOLE DISCRETION OF LENDER.

WAIVER OF CO-OBLIGOR'S RIGHTS. IF MORE THAN ONE PERSON IS OBLIGATED FOR
THE INDEBTEDNESS, BORROWER IRREVOCABLY WAIVES, DISCLAIMS AND RELINQUISHES
ALL CLAIMS AGAINST SUCH OTHER PERSON WHICH BORROWER HAS OR WOULD OTHERWISE
HAVE BY VIRTUE OF PAYMENT OF THE INDEBTEDNESS OR ANY PART THEREOF,
SPECIFICALLY INCLUDING BUT NOT LIMITED TO ALL RIGHTS OF INDEMNITY,
CONTRIBUTION OR EXONERATION.

GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS COMMERCIAL SECURITY
AGREEMENT, AND GRANTOR AGREES TO ITS TERMS. THIS AGREEMENT IS DATED APRIL 19,
1996.

GRANTOR:

BOYD'S WHEELS, INC.

BY: /s/ BOYD CODDINGTON
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

DISBURSEMENT REQUEST AND AUTHORIZATION

$599,874.42 04-19-1996 05-01-2001 13483 510 055 104121 GG1
- ------------------------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN
OR ITEM.
- ------------------------------------------------------------------------------------------------------------------------------------

BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17752 E. 17TH STREET
TUSTIN, CA 92680

LOAN TYPE. THIS IS A VARIABLE RATE (1.750% OVER WALL STREET JOURNAL PRIME RATE,
MAKING AN INITIAL RATE OF 10.000%), PRINCIPAL PLUS INTEREST LOAN TO A
CORPORATION FOR $599,874.42 DUE ON MAY 1, 2001.

PRIMARY PURPOSE OF LOAN. THE PRIMARY PURPOSE OF THIS LOAN IS FOR (PLEASE
INITIAL):

/ / ____ PERSONAL, FAMILY, OR HOUSEHOLD PURPOSES OR PERSONAL INVESTMENT

/x/ ____ BUSINESS (INCLUDING REAL ESTATE INVESTMENT)

SPECIFIC PURPOSE. THE SPECIFIC PURPOSE OF THIS LOAN IS: TO TERM OUT NOTE #13483,
ORIGINAL PURPOSE WAS TO PURCHASE EQUIPMENT.

AMOUNT PAID ON BORROWER'S ACCOUNT: $599,874.42
$599,874.42 PAYMENT ON LOAN # 13483
-----------
NOTE PRINCIPAL: $599,874.42

FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND
WARRANTS TO LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND
THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S FINANCIAL CONDITION
AS DISCLOSED IN BORROWER'S MOST RECENT FINANCIAL STATEMENT TO LENDER. THIS
AUTHORIZATION IS DATED APRIL 19, 1996.

BORROWER:

BOYD'S WHEELS, INC.

BY: /s/ BOYD CODDINGTON
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO

PROMISSORY NOTE

- -----------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL LOAN DATE MATURITY LOAN NO. CALL COLLATERAL ACCOUNT OFFICER INITIALS

$599,874.42 04-19-1996 05-01-2001 13483 510 055 104121 GG1
- -----------------------------------------------------------------------------------------------------------------------------------
REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN
OR ITEM.
- -----------------------------------------------------------------------------------------------------------------------------------

BORROWER: BOYD'S WHEELS, INC. LENDER: ELDORADO BANK
8380 CERRITOS AVENUE TUSTIN OFFICE
STANTON, CA 90680 17752 E. 17TH STREET
TUSTIN, CA 92680

PRINCIPAL AMOUNT: $599,874.42 INITIAL RATE: 10.000% DATE OF NOTE: APRIL 19, 1996

PROMISE TO PAY. BOYD'S WHEELS, INC. ("BORROWER") PROMISES TO PAY TO ELDORADO
BANK ("LENDER"), OR ORDER, IN LAWFUL MONEY OF THE UNITED STATES OF AMERICA, THE
PRINCIPAL AMOUNT OF FIVE HUNDRED NINETY NINE THOUSAND EIGHT HUNDRED SEVENTY FOUR
& 42/100 DOLLARS ($599,874.42), TOGETHER WITH INTEREST ON THE UNPAID PRINCIPAL
BALANCE FROM APRIL 19, 1996, UNTIL PAID IN FULL.

PAYMENT. SUBJECT TO ANY PAYMENT CHANGES RESULTING FROM CHANGES IN THE INDEX,
BORROWER WILL PAY THIS LOAN ON DEMAND, OR IF NO DEMAND IS MADE, IN 50 PRINCIPAL
PAYMENTS OF $10,000.000 EACH AND ONE FINAL PRINCIPAL AND INTEREST PAYMENT OF
$9,956.71. BORROWER'S FIRST PRINCIPAL PAYMENT IS DUE JUNE 1, 1996, AND ALL
SUBSEQUENT PRINCIPAL PAYMENTS ARE DUE ON THE SAME DAY OF EACH MONTH AFTER THAT.
IN ADDITION, BORROWER WILL PAY REGULAR MONTHLY PAYMENTS OF ACCRUED UNPAID
INTEREST DUE AS OF EACH PAYMENT DATE. BORROWER'S FIRST INTEREST PAYMENT IS DUE
JUNE 1, 1996, AND ALL SUBSEQUENT INTEREST PAYMENTS ARE DUE ON THE SAME DAY OF
EACH MONTH AFTER THAT. BORROWER'S FINAL PAYMENT DUE MAY 1, 2001, WILL BE FOR ALL
PRINCIPAL AND ACCRUED INTEREST NOT YET PAID. INTEREST ON THE NOTE IS COMPUTED ON
A 365/360 SIMPLE INTEREST BASIS; THAT IS, BY APPLYING THE RATIO OF THE ANNUAL
INTEREST RATE OVER A YEAR OF 360 DAYS, MULTIPLIED BY THE OUTSTANDING PRINCIPAL
BALANCE, MULTIPLIED BY THE OUTSTANDING PRINCIPAL BALANCE, MULTIPLIED BY THE
ACTUAL NUMBER OF DAYS THE PRINCIPAL BALANCE IS OUTSTANDING. BORROWER WILL PAY
LENDER AT LENDER'S ADDRESS SHOWN ABOVE OR AT SUCH OTHER PLACE AS LENDER MAY
DESIGNATE IN WRITING. UNLESS OTHERWISE AGREED OR REQUIRED BY APPLICABLE LAW,
PAYMENTS WILL BE APPLIED FIRST TO ACCRUED UNPAID INTEREST, THEN TO PRINCIPAL,
AND ANY REMAINING AMOUNT TO ANY UNPAID COLLECTION COSTS AND LATE CHARGES.

VARIABLE INTEREST RATE. THE INTEREST RATE ON THIS NOTE IS SUBJECT TO CHANGE FROM
TIME TO TIME BASED ON CHANGES IN AN INDEPENDENT INDEX WHICH IS THE WALL STREET
JOURNAL PRIME RATE (THE "INDEX"). THE INDEX IS NOT NECESSARILY THE LOWEST RATE
CHARGED BY LENDER ON ITS LOANS. IF THE INDEX BECOMES UNAVAILABLE DURING THE TERM
OF THIS LOAN, LENDER MAY DESIGNATE A SUBSTITUTE INDEX AFTER NOTICE TO BORROWER.
LENDER WILL TELL BORROWER THE CURRENT INDEX RATE UPON BORROWER'S REQUEST.
BORROWER UNDERSTANDS THAT LENDER MAY MAKE LOANS BASED ON OTHER RATES AS WELL.
THE INTEREST RATE CHANGE WILL NOT OCCUR MORE OFTEN THAN EACH DAY. THE INDEX
CURRENTLY IS 8.250% PER ANNUM. THE INTEREST RATE TO BE APPLIED TO THE UNPAID
PRINCIPAL BALANCE OF THIS NOTE WILL BE AT A RATE OF 1.750 PERCENTAGE POINTS OVER
THE INDEX, RESULTING IN AN INITIAL RATE OF 10.000% PER ANNUM. NOTICE: UNDER NO
CIRCUMSTANCES WILL THE INTEREST RATE ON THIS NOTE BE MORE THAN THE MAXIMUM RATE
ALLOWED BY APPLICABLE LAW.

LATE CHARGE. IF A PAYMENT IS 10 DAYS OR MORE LATE, BORROWER WILL BE CHARGED
5.000% OF THE REGULARLY SCHEDULED PAYMENT OR $10.00, WHICHEVER IS GREATER.

DEFAULT. BORROWER WILL BE IN DEFAULT IF ANY OF THE FOLLOWING HAPPENS: (A)
BORROWER FAILS TO MAKE ANY PAYMENT WHEN DUE. (B) BORROWER BREAKS ANY PROMISE
BORROWER HAS MADE TO LENDER, OR BORROWER FAILS TO COMPLY WITH OR TO PERFORM WHEN
DUE ANY OTHER TERM, OBLIGATION, COVENANT, OR CONDITION CONTAINED IN THIS NOTE OR
ANY AGREEMENT RELATED TO THIS NOTE, OR IN ANY OTHER AGREEMENT OR LOAN BORROWER
HAS WITH LENDER. (C) BORROWER DEFAULTS UNDER ANY LOAN, EXTENSION OF CREDIT,
SECURITY AGREEMENT, PURCHASE OR SALES AGREEMENT, OR ANY OTHER AGREEMENT, IN
FAVOR OF ANY OTHER CREDITOR OR PERSON THAT MAY MATERIALLY AFFECT ANY OF
BORROWER'S PROPERTY OR BORROWER'S ABILITY TO REPAY THIS NOTE OR PERFORM
BORROWER'S OBLIGATIONS UNDER THIS NOTE OR ANY OF THE RELATED DOCUMENTS. (D) ANY
REPRESENTATION OR STATEMENT MADE OR FURNISHED TO LENDER BY BORROWER OR ON
BORROWER'S BEHALF IS FALSE OR MISLEADING IN ANY MATERIAL RESPECT EITHER NOW OR
AT THE TIME MADE OR FURNISHED. (E) BORROWER BECOMES INSOLVENT, A RECEIVER IS
APPOINTED FOR ANY PART OF BORROWER'S PROPERTY, BORROWER MAKES AN ASSIGNMENT FOR
THE BENEFIT OF CREDITORS, OR ANY PROCEEDING IS COMMENCED EITHER BY BORROWER OR
AGAINST BORROWER UNDER ANY BANKRUPTCY OR INSOLVENCY LAWS. (F) ANY CREDITOR TRIES
TO TAKE ANY OF BORROWER'S PROPERTY ON OR IN WHICH LENDER HAS A LIEN OR SECURITY
INTEREST. THIS INCLUDES A GARNISHMENT OF ANY OF BORROWER'S ACCOUNTS WITH LENDER.
(G) ANY GUARANTOR DIES OR ANY OF THE OTHER EVENTS DESCRIBED IN THIS DEFAULT
SECTION OCCURS WITH RESPECT TO ANY GUARANTOR OF THIS NOTE. (H) A MATERIAL
ADVERSE CHANGE OCCURS IN BORROWER'S FINANCIAL CONDITION, OR LENDER BELIEVES THE
PROSPECT OF PAYMENT OR PERFORMANCE OF THE INDEBTEDNESS IS IMPAIRED.

LENDER'S RIGHTS. UPON DEFAULT, LENDER MAY DECLARE THE ENTIRE UNPAID PRINCIPAL
BALANCE ON THIS NOTE AND ALL ACCRUED UNPAID INTEREST IMMEDIATELY DUE, WITHOUT
NOTICE, AND THEN BORROWER WILL PAY THAT AMOUNT. UPON BORROWER'S FAILURE TO PAY
ALL AMOUNTS DECLARED DUE PURSUANT TO THIS SECTION, INCLUDING FAILURE TO PAY UPON
FINAL MATURITY, LENDER, AT ITS OPTION, MAY ALSO, IF PERMITTED UNDER APPLICABLE
LAW, INCREASE THE VARIABLE INTEREST RATE ON THIS NOTE TO 6.750 PERCENTAGE POINTS
OVER THE INDEX. LENDER MAY HIRE OR PAY SOMEONE ELSE TO HELP COLLECT THIS NOTE IF
BORROWER DOES NOT PAY. BORROWER ALSO WILL PAY LENDER THAT AMOUNT. THIS INCLUDES,
SUBJECT TO ANY LIMITS UNDER APPLICABLE LAW, LENDER'S ATTORNEYS' FEES AND
LENDERS' LEGAL EXPENSES WHETHER OR NOT THERE IS A LAWSUIT, INCLUDING ATTORNEYS'
FEES AND LEGAL EXPENSES FOR BANKRUPTCY PROCEEDINGS (INCLUDING EFFORTS TO MODIFY
OR VACATE ANY AUTOMATIC STAY OR INJUNCTION), APPEALS, AND ANY ANTICIPATED
POST-JUDGMENT COLLECTION SERVICES. BORROWER ALSO WILL PAY ANY COURT COSTS, IN
ADDITION TO ALL OTHER SUMS PROVIDED BY LAW. THIS NOTE HAS BEEN DELIVERED TO
LENDER AND ACCEPTED BY LENDER IN THE STATE OF CALIFORNIA. IF THERE IS A LAWSUIT,
BORROWER AGREES UPON LENDER'S REQUEST TO SUBMIT TO THE JURISDICTION OF THE
COURTS OF ORANGE COUNTY, THE STATE OF CALIFORNIA. THIS NOTE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

RIGHT OF SETOFF. BORROWER GRANTS TO LENDER A CONTRACTUAL PROMISSORY SECURITY
INTEREST IN, AND HEREBY ASSIGNS, CONVEYS, DELIVERS, PLEDGES, AND TRANSFERS TO
LENDER ALL BORROWER'S RIGHT, TITLE AND INTEREST IN AND TO, BORROWER'S ACCOUNTS
WITH LENDER (WHETHER CHECKING, SAVINGS, OR SOME OTHER ACCOUNT), INCLUDING
WITHOUT LIMITATION ALL ACCOUNTS HELD JOINTLY WITH SOMEONE ELSE AND ALL ACCOUNTS
BORROWER MAY OPEN IN THE FUTURE, EXCLUDING HOWEVER ALL IRA AND KEOGH ACCOUNTS,
AND ALL TRUST ACCOUNTS FOR WHICH THE GRANT OF A SECURITY INTEREST WOULD BE
PROHIBITED BY LAW. BORROWER AUTHORIZES LENDER, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, TO CHARGE OR SETOFF ALL SUMS OWING ON THIS NOTE AGAINST ANY AND
ALL SUCH ACCOUNTS.

COLLATERAL. THIS NOTE IS SECURED BY VARIOUS SECURITY AGREEMENTS DATED NOVEMBER
28, 1995, JANUARY 10, 1996 AND MARCH 19, 1996.
27
04-19-1996 PROMISSORY NOTE PAGE 2
LOAN NO. 13483 (CONTINUED)

GENERAL PROVISIONS. THIS NOTE IS PAYABLE ON DEMAND. THE INCLUSION OF SPECIFIC
DEFAULT PROVISIONS OR RIGHTS OF LENDER SHALL NOT PRECLUDE LENDER'S RIGHT TO
DECLARE PAYMENT OF THIS NOTE ON ITS DEMAND. LENDER MAY DELAY OR FORGO ENFORCING
ANY OF ITS RIGHTS OR REMEDIES UNDER THIS NOTE WITHOUT LOSING THEM. BORROWER AND
ANY OTHER PERSON WHO SIGNS, GUARANTEES OR ENDORSES THIS NOTE, TO THE EXTENT
ALLOWED BY LAW, WAIVE ANY APPLICABLE STATUTE OF LIMITATIONS, PRESENTMENT, DEMAND
FOR PAYMENT, PROTEST AND NOTICE OF DEBTOR. UPON ANY CHANGE IN THE TERMS OF THIS
NOTE, AND UNLESS OTHERWISE EXPRESSLY STATED IN WRITING, NO PARTY WHO SIGNS THIS
NOTE, WHETHER AS MAKER, GUARANTOR, ACCOMMODATION, MAKER OR ENDORSER, SHALL BE
RELEASED FROM LIABILITY. ALL SUCH PARTIES AGREE THAT LENDER MAY RENEW OR EXTEND
(REPEATEDLY AND FOR ANY LENGTH OF TIME) THIS LOAN, OR RELEASE ANY PARTY OR
GUARANTOR OR COLLATERAL; OR IMPAIR, FAIL TO REALIZE UPON OR PERFECT LENDER'S
SECURITY INTEREST IN THE COLLATERAL; AND TAKE ANY OTHER ACTION DEEMED NECESSARY
BY LENDER WITHOUT THE CONSENT OF OR NOTICE TO ANYONE. ALL SUCH PARTIES ALSO
AGREE THAT LENDER MAY MODIFY THIS LOAN WITHOUT THE CONSENT OF OR NOTICE TO
ANYONE OTHER THAN THE PARTY WITH WHOM THE MODIFICATION IS MADE.

BORROWER:

BOYD'S WHEELS, INC.

BY: /s/ BOYD CODDINGTON
-------------------------------
BOYD CODDINGTON, CHAIRMAN & CEO