EXHIBIT 10.50

AMENDED AND RESTATED LOAN AGREEMENT,
dated as of December 24, 1997,

by and among

MEDALLION FUNDING CORP.,

THE LENDERS PARTY THERETO,

FLEET BANK, NATIONAL ASSOCIATION
AS SWING LINE LENDER,
ADMINISTRATIVE AGENT AND COLLATERAL AGENT

and

THE BANK OF NEW YORK
AS DOCUMENTATION AGENT

with

FLEET BANK, NATIONAL ASSOCIATION
AS ARRANGER

                               TABLE OF CONTENTS


ARTICLE 1. DEFINITIONS.........................................   1
     SECTION 1.1. Defined Terms................................   1
     SECTION 1.2. Other Definitional Provisions................  24

ARTICLE 2. AMOUNT AND TERMS OF REVOLVING CREDIT LOANS..........  25
     SECTION 2.1. Commitments and Loans........................  25
     SECTION 2.2. Revolving Credit, Term Loan and Swing Line
                  Notes........................................  27
     SECTION 2.3. Procedures Applicable to Borrowings and
                  Conversions..................................  31
     SECTION 2.4. Termination and Reduction of Aggregate
                  Revolving Credit Commitment..................  35
     SECTION 2.5. Prepayments..................................  36
     SECTION 2.6. Interest on Delinquent Payments..............  38
     SECTION 2.7. Increased Costs..............................  39
     SECTION 2.8. Existing Indebtedness; Existing Fees;
                  Existing Interest; Use of Proceeds...........  41
     SECTION 2.9. Payment on Non-Business Days.................  42
     SECTION 2.10. Term of Revolving Credit Commitments........  42
     SECTION 2.11. Funding Losses..............................  44
     SECTION 2.12. Alternate Rate of Interest..................  45
     SECTION 2.13. Changes In Legality.........................  45
     SECTION 2.14. Participations..............................  46
     SECTION 2.15. Commercial Paper Borrowings.................  46

ARTICLE 3. FEES AND PAYMENTS...................................  47
     SECTION 3.1. Fees.........................................  47
     SECTION 3.2. Payments.....................................  47
     SECTION 3.3. Taxes........................................  48

ARTICLE 4. REPRESENTATIONS AND WARRANTIES......................  49
     SECTION 4.1. Corporate Status.............................  50
     SECTION 4.2. Subsidiaries.................................  50
     SECTION 4.3. Location of Offices, Books and Records.......  50
     SECTION 4.4. Corporate Power; Authorization...............  50
     SECTION 4.5. Enforceable Obligations......................  51
     SECTION 4.6. No Violation of Agreements; Compliance with
                  Law..........................................  51
     SECTION 4.7. Agreements...................................  51
     SECTION 4.8. No Material Litigation.......................  51
     SECTION 4.9. Good Title to Properties.....................  52
     SECTION 4.10. Margin Regulations..........................  52
     SECTION 4.11. SBIC........................................  52

                                     - 1 -

     SECTION 4.12. Investment Company..........................  52
     SECTION 4.13. Disclosure..................................  53
     SECTION 4.14. Taxes and Claims............................  53
     SECTION 4.15. Licenses and Permits........................  53
     SECTION 4.16. Consents....................................  54
     SECTION 4.17. Employee Benefit Plans......................  54
     SECTION 4.18. Financial Condition.........................  55
     SECTION 4.19. Environmental Laws, Etc.....................  55
     SECTION 4.20. Event of Default............................  55
     SECTION 4.21. Solvency....................................  56
     SECTION 4.22. Priority....................................  56
     SECTION 4.23. Advertising, Origination and Servicing
                   Activities..................................  56
     SECTION 4.24. Activities..................................  56

ARTICLE 5. CONDITIONS PRECEDENT................................  56
     SECTION 5.1. Conditions to Initial Revolving Credit Loan
                  and Initial Swing Line Loan..................  56
     SECTION 5.2. Conditions to All Revolving Credit and Term
                  Loans........................................  59

ARTICLE 6. AFFIRMATIVE COVENANTS...............................  60
     SECTION 6.1. Financial Statements and Other Information...  60
     SECTION 6.2. Taxes and Claims.............................  63
     SECTION 6.3. Insurance....................................  64
     SECTION 6.4. Books and Records............................  64
     SECTION 6.5. Properties in Good Condition.................  64
     SECTION 6.6. Inspection by the Banks......................  64
     SECTION 6.7. Pay Indebtedness to Agent and Perform Other
                  Covenants....................................  65
     SECTION 6.8. Compliance With Laws.........................  65
     SECTION 6.9. Notice of Certain Events.....................  65
     SECTION 6.10. Environmental Laws, Etc.....................  66
     SECTION 6.11. Further Assurances..........................  66
     SECTION 6.12. ERISA.......................................  67
     SECTION 6.13. Corporate Existence.........................  67
     SECTION 6.14. Maintenance of Security Interest............  67
     SECTION 6.15. Required Percentage of Medallion Loans......  67
     SECTION 6.16. Intentionally Omitted.......................  67

ARTICLE 7. FINANCIAL COVENANTS.................................  68
     SECTION 7.1. Minimum Tangible Net Worth...................  68
     SECTION 7.2. Maximum Liability Ratio......................  68
     SECTION 7.3. Minimum Net Finance Assets...................  68
     SECTION 7.4. Minimum Net Income to Interest Expense
                  Ratio........................................  68

                                     - 2 -

ARTICLE 8. NEGATIVE COVENANTS...............................  68
     SECTION 8.1. Liens.....................................  69
     SECTION 8.2. Indebtedness..............................  70
     SECTION 8.3. Limitation on Loans and Investments.......  70
     SECTION 8.4. Limitation on Subsidiaries................  71
     SECTION 8.5. Restricted Payments.......................  71
     SECTION 8.6. Merger, Consolidation, Sale or Transfers
                  Assets....................................  71
     SECTION 8.7. Transfer of Proceeds......................  72
     SECTION 8.8. Compliance with ERISA.....................  72
     SECTION 8.9. Change in Business........................  72
     SECTION 8.10. Amendments of Agreements.................  72
     SECTION 8.11. Transactions with Affiliates.............  73
     SECTION 8.12. Negative Pledges.........................  73
     SECTION 8.13. Inconsistent Agreements..................  73
     SECTION 8.14. Capital Expenditures.....................  73
     SECTION 8.15. SBA Collateral...........................  73

ARTICLE 9. DEFAULTS AND REMEDIES............................  73
     SECTION 9.1. Events of Default.........................  73
     SECTION 9.2. Suits for Enforcement.....................  77
     SECTION 9.3. Rights and Remedies Cumulative............  77
     SECTION 9.4. Rights and Remedies Not Waived............  77
     SECTION 9.5. Further Payments..........................  77

ARTICLE 10. MISCELLANEOUS...................................  78
     SECTION 10.1. Collection Costs.........................  78
     SECTION 10.2. Modification and Waiver..................  79
     SECTION 10.3. GOVERNING LAW............................  80
     SECTION 10.4. Notices..................................  80
     SECTION 10.5. Accounting Terms.........................  81
     SECTION 10.6. Costs and Expenses; Indemnity............  81
     SECTION 10.7. WAIVER OF JURY TRIAL AND SETOFF..........  82
     SECTION 10.8. Captions.................................  83
     SECTION 10.9. Lien; Setoff by Banks....................  83
     SECTION 10.10. Security................................  84
     SECTION 10.11. Jurisdiction; Service of Process........  84
     SECTION 10.12. Benefit of Agreement....................  85
     SECTION 10.13. Counterparts............................  85
     SECTION 10.14. Interest................................  85
     SECTION 10.15. Attorneys' Fees.........................  86
     SECTION 10.16. Severability............................  87
     SECTION 10.17. Confidentiality.........................  87
     SECTION 10.18. Loss, Theft, Etc. of Notes..............  87

                                     - 3 -

ARTICLE 11. AGENCY..........................................  88
     SECTION 11.1. Appointment and Actions..................  88
     SECTION 11.2. Independent Credit Decisions.............  91
     SECTION 11.3. Indemnification of Agent.................  91
     SECTION 11.4. Resignation and Succession...............  92

ARTICLE 12. SALES AND TRANSFERS.............................  93
     SECTION 12.1. Sales and Transfers......................  93
     SECTION 12.2. New Banks................................  96

AMENDED AND RESTATED LOAN AGREEMENT, dated as of December 24, 1997, among MEDALLION FUNDING CORP., a New York corporation ("Borrower"), the banks that from time to time are signatories hereto (including Assignees (as hereinafter defined), collectively, the "Banks" and individually, a "Bank"), FLEET BANK, NATIONAL ASSOCIATION , as a Bank ("Fleet"), as swing line lender (the "Swing Line Lender"), as Arranger and as Administrative Agent and Collateral Agent for the Banks (including any successor, the "Agent") and The Bank of New York, as a Bank ("BONY") and as Documentation Agent for the Banks (including any successor, the "Documentation Agent").

WHEREAS, the Borrower, the Agent and the Banks are parties to a Loan Agreement dated as of March 27, 1992 and such Loan Agreement was previously amended by Amendment One, Amendment Two, Amendment Three, Amendment Four, Amendment Five and Amendment Six thereto (as so previously amended, the "Prior Agreement"); and

WHEREAS, the Borrower, the Agent, the Documentation Agent, the Banks and the Swing Line Lender desire to amend and restate in its entirety the Prior Agreement and make further changes thereto, upon the terms and subject to the conditions set forth herein;

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

ARTICLE 1. DEFINITIONS

As used in this Agreement, the terms defined in the recitals hereto shall have the respective meanings ascribed thereto in said recitals and the following terms shall have the following respective meanings:

                                         Applicable
                                         ----------
Pricing Level                       Commitment Percentage
-------------                       ---------------------

     1                                      0.150%

     2                                      0.175%

     3                                      0.20%

Subject to and in accordance with the final paragraph of this definition, the Applicable Commitment Percentage shall be effective for each Payment Period (or in the circumstances described in the final paragraph of this definition, such portion of a Payment Period) whether or not such Payment Period coincides with the period pursuant to which such Commitment Fee was payable.

Anything in this Agreement to the contrary notwithstanding, the Applicable Commitment Percentage for a Payment Period shall be the highest rate provided for above if the certificate of a Financial Officer of the Borrower shall not be delivered when required by Section 6.1(f) with respect to the portion of such Payment Period to which such certificate relates).

                               Applicable LIBO Margin
                               -----------------------
Pricing Level                       (% per annum)
-------------                       -------------

     1                                   0.95%

     2                                   1.05%

     3                                   1.15%

; provided, that, upon Borrower obtaining both its D-2 Rating from Duff & Phelps and its F-2 Rating from Fitch Investor's Services, then the Applicable LIBO Margin shall decrease by 15 basis points at each Pricing Level and shall be the respective rates indicated below for Revolving Credit Loans and Term Loans which are LIBO Rate Loans opposite the applicable Pricing Level indicated below for such Payment Period (or as provided in the final paragraph of this definition, for part of a Payment Period):

                               Applicable LIBO Margin
                               -----------------------
Pricing Level                       (% per annum)
-------------                       -------------

     1                                   0.80%

     2                                   0.90%

     3                                   1.00%

; provided, further, that, at any time Borrower fails to retain both of such ratings, the Applicable LIBO Margin shall increase by 15 basis points at each Pricing Level and shall be the respective rates indicated in the first chart in this definition for Revolving Credit Loans and Term Loans which are LIBO Rate Loans opposite the applicable Pricing Level indicated in such chart for such Payment Period (or as provided in the final paragraph of this definition, for part of a Payment Period).

Subject to and in accordance with the final paragraph of this definition, the Applicable LIBO Margin shall be effective for each Payment Period (or in the circumstances described in the final paragraph of this definition, such portion of a Payment Period) whether or not such Payment Period coincides with an Interest Period for a LIBO Rate Loan.

Anything in this Agreement to the contrary notwithstanding, the Applicable LIBO Margin for a Payment

Period shall be the highest rate provided for above if the certificate of a Financial Officer of the Borrower shall not be delivered when required by
Section 6.1(f) with respect to the portion of such Payment Period to which such certificate relates).

(b) as to which a court of competent jurisdiction shall enter an order, judgment or decree appointing or authorizing a receiver, trustee, liquidator, custodian or conservator of such Person or of the whole or substantially all of its property, or enters an order for relief against such Person in any case commenced under any chapter of the United States Bankruptcy Code, as amended, or grants relief under any other similar law or statute of the United States of America, any state thereof or any foreign country; or as to which, under the provisions of any law for the relief or aid of debtors, a court of competent jurisdiction or a receiver, trustee,

liquidator, custodian or conservator shall assume custody or control or take possession of such Person or of the whole or substantially all of its property; or as to which there is commenced against such Person any proceeding for any of the foregoing relief or as to which a petition is filed against such Person under any chapter of the United States Bankruptcy Code, as amended, or under any other similar law or statute of the United States of America or any state thereof or any foreign country and such proceeding or petition remains undismissed for a period of 60 days; or as to which such Person by any act indicates its consent to approval of or acquiescence in any such proceeding or petition.

by the parties hereto shall have been received by the Agent and (ii) the conditions precedent set forth in Article V hereto shall have been satisfied or waived in writing by all of the Banks.

(a) such Loan is made to, and is a recourse obligation of, the Person to whom such Loan is made,

(b) such Loan is a Domestic Loan,

(c) such Loan is in compliance with the SBI Act and all SBA Regulations promulgated thereunder and, after giving effect to such Loan, Borrower and its business and operations taken as a whole, is in compliance with the SBI Act and all SBA Regulations promulgated thereunder,

(d) such Loan is pledged in accordance with Section 2.1 of the Borrower Security Agreement,

(e) the representations, warranties and covenants contained in
Section 4.1 of the Borrower Security Agreement are true and correct, and have been complied with, with respect to such Loan, and

(f) the Agent, on behalf of the Banks, has a perfected, first priority security interest in such Loan.

reference to which the interest rate on LIBO Rate Loans is determined, or any category of extensions of credit or other assets, including loans by a non- United States office of any Bank to United States residents).

participation of the Swing Line Loans, over (b) all reimbursements of such Bank in respect thereof.

commencement of such Interest Period, in an amount comparable to the principal amount of the LIBO Rate Loan and having a scheduled maturity comparable to such Interest Period (as set forth in the Loan Request) for delivery in immediately available funds on the first day of such Interest Period.

Agent, for the benefit of the Banks, pursuant to the Borrower Security Agreement.

(ii) the aggregate outstanding principal balances of, plus accrued interest on, all Eligible Medallion Loans and Eligible Commercial Loans shown on Borrower's balance sheet as of the most recent fiscal quarter,

(vi) the aggregate outstanding principal of, plus accrued interest on, the SBA Collateral;

as approved by the Agent and the Required Banks in accordance with the terms of this Agreement.

     Range of
     Debt-Equity Ratio                             Pricing Level
     -----------------                             -------------

Less than 2.0 to 1                                        1

Greater than or equal to 2.0
but less than 3.0 to 1                                    2

Greater than or equal to 3.0 to 1                         3

quarter on which such calculation is based; provided, that, in the case of the initial Payment Period the calculation shall be based on the Debt-Equity calculation set forth in the certificate delivered by Borrower to the Banks on or prior to the Effective Date with respect to the fiscal quarter ending September 30, 1997.

excess of 51% of the sum of the Aggregate Revolving Credit Commitment plus all Term Loans then outstanding.

shall end after the Scheduled Swing Line Commitment Termination Date. Interest shall accrue from and including the first day of a Swing Line Interest Period to, but excluding, the last day of such Swing Line Interest Period.

(a) All terms defined in this Agreement in the singular shall have comparable meanings when used in the plural, and vice versa.

(c) Any defined term which relates to a document shall include within its definition any amendments, modifications, renewals, restatements, extensions, supplements, or substitutions which may have been heretofore or may be hereafter executed in accordance with the terms thereof and hereof.

(d) References in this Agreement to particular sections of the Code, ERISA or any other legislation shall be deemed to refer also to any successor sections thereto or other redesignations for codification purposes.

(e) All terms defined in the UCC and not otherwise defined or modified herein shall have the same respective meanings as are given to such terms in the UCC.

ARTICLE 2. AMOUNT AND TERMS OF REVOLVING CREDIT LOANS

Swing Line Loan shall be made prior to the making of the first Revolving Credit Loans on the Effective Date.

(ii) The Swing Line Lender shall not be obligated to make any Swing Line Loan at a time when any Bank shall be in default of its obligations under this Agreement unless arrangements to eliminate the Swing Line Lender's risk with respect to such defaulting Bank's participation in such Swing Line Loan shall have been made for the benefit of the Swing Line Lender and such arrangements are in all respects satisfactory to the Swing Line Lender. The Swing Line Lender will not make any Swing Line Loan if the Agent or any Bank, by notice to the Swing Line Lender and the Borrower no later than one Business Day prior to the borrowing date with respect to such Swing Line Loan, shall have determined that the conditions set forth in ARTICLE 5 have not been satisfied and such conditions remain unsatisfied as of the requested time of the making of such Swing Line Loan. Each Swing Line Loan shall be due and payable on the earlier to occur of the last day of the Swing Line Interest Period applicable thereto and the Swing Line Maturity Date.

(iv) In furtherance of Section 2.2(c), upon the occurrence of any event set forth in Section 2.1(c)(iii), such Bank shall promptly make available its Swing Line Participation Amount to the Agent for the account of the Swing Line Lender at the applicable Agent Payment Office, in Dollars, and in

immediately available funds. The Agent shall deliver the payments made by each Bank pursuant to the immediately preceding sentence to the Swing Line Lender promptly upon receipt thereof in like funds as received. Each Bank shall indemnify and hold harmless the Agent and the Swing Line Lender from and against any and all losses, liabilities (including liabilities for penalties), actions, suits, judgments, demands, costs and expenses resulting from any failure on the part of such Bank to pay, or from any delay in paying the Agent any amount such Bank is required to pay in accordance with this Section
2.1(c)(iv) (except in respect of losses, liabilities, actions, suits, judgments, demands, costs and expenses suffered by the Agent or the Swing Line Lender, as the case may be, resulting from the gross negligence or willful misconduct of the Agent or the Swing Line Lender, as the case may be), and such Bank shall be required to pay interest to the Agent for the account of the Swing Line Lender from the date such amount was due until paid in full, on the unpaid portion thereof, at a rate of interest per annum equal to the Federal Funds Rate payable upon demand by the Swing Line Lender. The Agent shall distribute such interest payments to the Swing Line Lender upon receipt thereof in like funds as received.

(v) Whenever the Agent is reimbursed by the Borrower, for the account of the Swing Line Lender, for any payment in connection with Swing Line Loans and such payment relates to an amount previously paid by a Bank pursuant to this Section, the Agent will promptly pay over such payment to such Bank.

be dated (A) the Effective Date, in the case of each Revolving Credit Note and the Swing Line Note and (B) the applicable Term Out Date, in the case of each Term Note issued in replacement of a Revolving Credit Loan, and shall be payable at its Maturity. For purposes of this Agreement, the term "Maturity" shall mean, with respect to (i) any Revolving Credit Loan, the earlier of (A) the Term Out Date for such Revolving Credit Loan, (B) the Termination Date and
(C) any other date on which such Revolving Credit Loan shall be or become due and payable, in whole or in part, in accordance with the terms of this Agreement, whether by required or optional prepayment, declaration, acceleration, or otherwise, (ii) with respect to any Swing Line Loan, on the earlier of (A) the date such Swing Line Loan shall be or become due and payable, in whole or in part, in accordance with the terms of this Agreement whether by stated maturity, required or optional prepayment, declaration, acceleration, or otherwise, or (B) the Swing Line Commitment Termination Date and (iii) with respect to any Term Loan made by a Bank to replace its existing Revolving Credit Loans pursuant to Section 2.1(b) hereof, the earlier of (A) the second anniversary of the Term Out Date applicable to such replaced Revolving Credit Loans and (B) any other date on which such Term Loan shall be or become due and payable, in whole or in part, in accordance with the terms of this Agreement, whether by required or optional prepayment, declaration, acceleration, or otherwise.

(A) in the case of a LIBO Rate Loan, (I) if the numerically corresponding date in the appropriate month is not a Banking Day, such Interest Period shall be extended to the next succeeding day that is a Banking Day unless such day falls in the succeeding calendar month, in which event such Interest Period shall end on the first preceding day that is a Banking Day and (II) if there is no numerically corresponding date in the appropriate month, such Interest Period shall end on the last Banking Day in such month,

(B) in the case of any LIBO Rate Loan made on or after the Term Out Date, the Interest Period shall be limited to a period of one month, and

(C) in no case shall the Interest Period of either a Revolving Credit Loan or a Term Loan end on a date subsequent to such loan's Maturity.

(i) the Maturity of such loan;

(ii) with respect to any portion of any Revolving Credit Loan, Swing Line Loan or Term Loan repaid or prepaid pursuant to this Agreement, the date of such repayment or prepayment, as the case may be;

(iii) with respect to the Swing Line Loans and with respect to any portion of the outstanding principal amount of Revolving Credit Loans and Term Loans maintained as Prime Rate Loans, the first Business Day of each calendar month, payable monthly and in arrears, commencing with the first such date following the date of the making of such Revolving Credit Loans, Swing Line Loans or Term Loans as, or, with respect to Revolving Credit Loans and Term Loans, their conversion into, Prime Rate Loans;

(iv) with respect to the portion of the outstanding principal amount of all Revolving Credit Loans or Term Loans maintained as LIBO Rate Loans, the last day of each applicable Interest Period and, in connection with any such Revolving Credit Loan having a four, five, or six-month Interest Period, the day that would be the last day of a three-month Interest Period commencing on the same day as such four, five, or six-month Interest Period commences; and

(v) with respect to that portion of the outstanding principal amount of all Revolving Credit Loans or Term Loans that is converted to Prime Rate Loans or LIBO Rate Loans on a day when interest otherwise would not have been payable pursuant to Section 2.2(c)(iii) or (iv), the date of such conversion.

(A) in the case of a borrowing of a Revolving Credit Loan as a Prime Rate Loan, on or before 10:00 a.m., prevailing New York City time, on the first Business Day preceding the requested borrowing date, which borrowing date shall be a Business Day (or irrevocable oral notice on or before 10:00 a.m., prevailing New York City time, on such date, confirmed in a Loan Request (which may be sent via teletransmission) no later than 5:00 p.m., prevailing New York City time, on such first Business Day preceding such borrowing date; and

(B) in the case of a borrowing of a Revolving Credit Loan as a LIBO Rate Loan, on or before 11:00 a.m., prevailing New York City time, on the third Banking Day preceding the first day of the requested Interest Period (or irrevocable oral notice on or before 11:00 a.m., prevailing New York City time, on such date, confirmed in a Loan Request (which may be sent via teletransmission) no later than 5:00 p.m., prevailing New York City time, on such third Banking Day preceding the first day of the requested Interest Period).

If Borrower furnishes a Loan Request to the Agent, but no election is made as to either the loan type or Interest Period to be applicable thereto, the Revolving Credit Loan will be made as a Prime Rate Loan. Each borrowing of a given loan type shall be in an aggregate principal amount, together with Revolving Credit Loans of the same loan type to be continued as such and Revolving Credit Loans of other loan types to be converted to such loan type on the same Business Day, of at least (x) $1,000,000 or any integral multiple of $100,000 in excess thereof in the case of LIBO Rate Loans and (y) $100,000 or any integral multiple of $50,000 in excess thereof in the case of Prime Rate Loans.

such corresponding amount, such amount so paid shall constitute such Bank's Revolving Credit Loan or Term Loan, as the case may be, as part of such Revolving Credit Loans and Term Loans for purposes of this Agreement, which Revolving Credit Loan and Term Loan, as the case may be, shall be deemed to have been made by such Bank on such borrowing date. No Bank's obligation to fund any Revolving Credit Loan or Term Loan shall be affected by any other Bank's failure to fund any Revolving Credit Loan or Term Loan, nor shall any Bank's Revolving Credit Commitment or Term Loan Commitment be increased as a result of any such failure of any other Bank.

(i) Borrower shall give the Agent the irrevocable written notice in the form of a Loan Request in the manner and by the applicable time specified in Section 2.3(a) hereof for the borrowing of a Revolving Credit Loan of the loan type to be converted to or continued and, if applicable, the Interest Period therefor;

(ii) in the case of the continuation of less than all of the outstanding Revolving Credit Loans or of only a portion of a Term Loan of a given loan type on the same Business Day, the aggregate principal amount of the Revolving Credit Loans or the Term Loan of such loan type to be continued as such, together with any Revolving Credit Loans or portion of a Term Loan to be made as or converted to the same loan type on such Business Day, shall not be less than $1,000,000 or any integral multiple of $100,000 in excess thereof;

(iii) in the case of the conversion of less than all of the outstanding Revolving Credit Loans or of only a portion of a Term Loan of a given loan type to another loan type on the same Business Day, the aggregate principal amount of Revolving Credit Loans or the portion of the Term Loan of such loan type to be converted to another loan type together with any Revolving Credit Loans or any portion of the Term Loan

of such other loan type to be made or continued as such on such Business Day, shall not be less than $1,000,000;

(iv) LIBO Rate Loans may be converted only at the end of the then applicable Interest Period;

(v) no LIBO Rate Loan may be continued as such, nor may any Revolving Credit Loan or Term Loan be converted to a LIBO Rate Loan, for less than the minimum applicable Interest Period therefor; and

(vi) no LIBO Rate Loan may be continued as such, nor may any Revolving Credit Loan or Term Loan be converted to a LIBO Rate Loan, if any Default or Event of Default shall have occurred and be continuing as of any date during the period commencing on the date the Loan Request is required to be submitted to the Agent and ending on the first day of the requested Interest Period.

If Borrower fails, in connection with the expiration of an Interest Period applicable to a Revolving Credit Loan or Term Loan that is a LIBO Rate Loan, to furnish a Loan Request to the Agent for the continuation or conversion thereof or fails to elect a loan type or permitted Interest Period therefor, or if the continuation or conversion of any Revolving Credit Loan or Term Loan as a LIBO Rate Loan is prohibited due to the occurrence and continuance of a Default or Event of Default, such Revolving Credit Loan or Term Loan (unless prepaid in accordance with the provisions of Section 2.5 hereof or accelerated in accordance with Section 9.1 hereof) shall be converted automatically to a Prime Rate Loan as of the expiration of the then applicable Interest Period.

inverse order of the dates on which such Principal Payments are to be made.

(ii) If, at any time, Net Finance Assets are less than the Minimum Asset Coverage, within five days of the first day there exists such deficiency the Borrower shall make payment to the Agent (to be applied against the Swing Line Loans first, then Revolving Credit Loans and then Term Loans) in an amount such that after taking into account such payment Net Finance Assets shall be at least (rounded upwards to the next higher integral multiple of $100,000) equal to the Minimum Asset Coverage, together with accrued interest thereon to the date of prepayment as provided in Section 2.2(c) hereof. To the extent possible, Borrower shall, in connection with such mandatory prepayment, prepay Prime Rate Loans first, and Fixed Rate Loans second. Any prepayment of Fixed Rate Loans shall be subject to Section 2.11 hereof.

and with respect to Revolving Credit Loans and Term Loans each such prepayment shall be effected pro rata amongst all the Banks in proportion to each Bank's then outstanding Revolving Credit Loans, or Term Loans, as the case may be.

All unpaid amounts due under the Notes or any other Loan Document that are not paid when due (including, to the extent permitted by law, unpaid interest on the Notes) shall bear interest, subject to the provisions of
Section 10.14 hereof, from and including its due date until paid in full (whether before or after the occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) hereof) at an annual rate equal to the sum of (i) in the case of any Prime Rate Loan, 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect, (ii) in the case of any Adjusted LIBO Rate Loan that is a Revolving Credit Loan, 3.75% plus the Adjusted LIBO Rate applicable to such Adjusted LIBO Rate Loan then in effect, and (iii) in the case of any Adjusted LIBO Rate Loan that is a Term Loan, 4% plus the Adjusted LIBO Rate applicable to such Adjusted LIBO Rate Loan then in effect. Such rate of interest (the "Default Rate") shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

(a) In the event any applicable existing or future law, regulation, guideline, treaty or directive or condition or interpretation thereof (including, without limitation, any request, guideline or policy; whether or not having the force of law), by any Governmental Authority charged with the administration or interpretation thereof, or any change in any of the foregoing, which:

(i) subjects any Bank, or the Swing Line Lender, to any tax levy, impost, duty, charge, fee, deduction or withholding of any nature with respect to its Revolving Credit

and/or Term Loan and/or Swing Line Commitment to make Fixed Rate Loans or any Revolving Credit Loan or Term Loan or Swing Line Loan that is a Fixed Rate Loan; or

(ii) changes the basis of taxation of payments to such Bank of principal of and/or interest on its Fixed Rate Loans or its Revolving Credit and/or Term Loan and/or Swing Line Commitment to make Fixed Rate Loans and/or fees and other amounts payable hereunder in respect of its Fixed Rate Loans or its Revolving Credit or Term Loan or Swing Line Commitment to make Fixed Rate Loans; or

(iii) imposes, modifies or deems applicable or results in the application of or increases any reserve, special-deposit, assessment, liquidity or similar requirement (whether or not having the force of law) against assets held by, or deposits in or for the account of, or loans or commitments to lend Fixed Rate Loans by any office of any Bank (based upon such Bank's or such Participant's reasonable allocation of the aggregate of such requirements); or

(iv) imposes upon such Bank any other condition or requirement with respect to its Revolving Credit and/or Term Loan and/or Swing Line Commitment to make Fixed Rate Loans or any Revolving Credit Loan or Term Loan or Swing Line Loan of which any Fixed Rate Loan forms a part;

and the result of any of the foregoing is to increase the actual cost to such Bank of making or maintaining its Revolving Credit and/or Term Loan and/or Swing Line Commitment to make Fixed Rate Loans or its Revolving Credit Loans or Term Loans or Swing Line Loans hereunder that are Fixed Rate Loans or to reduce the amount of any payment (whether of principal, interest, or otherwise) received or receivable by such Bank in respect of any Fixed Rate Loan or its Revolving Credit or Term Loan or Swing Line Commitment to make Fixed Rate Loans or to require such Bank to make any payment, then and in any such case set forth in paragraphs (i) through (iv) above:

(1) such Bank, or the Swing Line Lender, as the case may be, shall promptly notify Borrower in writing of the happening of such event;

(2) such Bank, or the Swing Line Lender, as the case may be, shall promptly deliver to Borrower a certificate of such Bank, or such Swing Line Lender, stating the event that has occurred or the reserve or requirements or other conditions

that have been imposed on such Bank, or such Swing Line Lender, the request, directive, guideline or requirement with which it has complied, together with the date thereof and the amount (based upon such Bank's, or such Swing Line Lender's, as the case may be, reasonable policies as to the allocation of capital and costs, as applicable) of such increased cost, reduction or payment for one or more periods ending not later than the date of such certificate; and

(3) Borrower shall pay within 10 days after demand therefor such amount or amounts as will compensate such Bank, or the Swing Line Lender, as the case may be, for such additional cost, reduction or payment.

(b) If, after the Effective Date, any Bank or the Swing Line Lender, as the case may be, shall have determined that any change in any present (or any adoption, application, or change in any future) applicable law, governmental rule, regulation, policy, guideline, or directive or request (whether or not having the force of law), or any change in the interpretation or administration thereof by any Governmental Authority charged with the interpretation or administration thereof, of general application regarding capital adequacy, capital maintenance, capital ratios or other similar requirements (whether or not having the force of law), or otherwise affects the amount of capital required or expected to be maintained by any of the Banks, or the Swing Line Lender, as the case may be, or any corporation controlling any of the Banks or the Swing Line Lender, as the case may be, or such Bank, or the Swing Line Lender, as the case may be, determines that the amount of capital required is increased by or based upon the existence of the revolving credit, swing line and term loan facilities or commitments established hereunder or any loans made pursuant hereto or upon agreements or loans of the type contemplated hereby then such Bank or the Swing Line Lender, as the case may be, may give written notice to Borrower of such fact (the "Increased Costs Notice"). To the extent that the costs of such increased capital requirements are not then reflected in the Prime Rate or the LIBO Base Rate, Borrower shall thereafter attempt to negotiate in good faith an adjustment of the compensation payable hereunder which will adequately compensate such Bank, or the Swing Line Lender, as the case may be, in light of such changed circumstances. Each Bank and the Swing Line Lender, as the case may be, hereby agrees that any Increased Cost Notice from it to Borrower shall be delivered to Borrower no later than 90 days following the end of any financial period with respect to which such

compensation is sought. If Borrower and such Bank, or the Swing Line Lender, as the case may be, are unable to agree to an adjustment within 30 days of the day on which the Borrower receives such notice, then, commencing on such thirtieth day and retroactive to the date of such notice (but not earlier than the effective date of any such change), the fees payable to such Bank, or the Swing Line Lender, as the case may be, hereunder shall increase by an amount which will, in such Bank's, or the Swing Line Lender's, as the case may be, reasonable determination, provide adequate compensation. Such Bank, or the Swing Line Lender, as the case may be, shall allocate such cost increases among its customers in good faith and on an equitable basis.

(c) The certificate of such Bank, or the Swing Line Lender, as the case may be as to the additional amounts payable pursuant to this Section 2.7 delivered to Borrower, in the absence of manifest error, shall be conclusive as to the amount thereof. A claim by any Bank, or the Swing Line Lender, as the case may be, for all or any part of any additional amount required to be paid by Borrower under this Section 2.7 may be made at any time and from time to time as the occasion therefor may arise. The protection of this Section 2.7 shall be available to such Bank and the Swing Line Lender regardless of any possible contention of invalidity or inapplicability of the law, regulation or condition that has been imposed. In the event that any such law, regulation or condition is subsequently held to be invalid or inapplicable and the result thereof is to eradicate any such additional cost, reduction or payment, such Bank, or the Swing Line Lender, as the case may be, shall promptly pay to Borrower an amount equal to the amount of compensation paid by Borrower to such Bank, or the Swing Line Lender, as the case may be, for its account as a result of such invalid or inapplicable law, regulation or condition.

(a) The proceeds of the Initial Revolving Credit Loans shall be used to refinance the Existing Indebtedness that is to be repaid pursuant to this
Section 2.8. Notwithstanding the provisions of subsections 2.8(b) - 2.8(e) below, the Notes executed in connection with this Agreement shall amend, restate, replace and supersede the Notes made by Borrower to the order of the Banks in connection with the Prior Agreement (the "Prior Notes"); provided, however, that the execution and

delivery of the Notes shall not in any circumstance be deemed to have terminated, extinguished or discharged the Borrower's indebtedness under such Prior Notes, all of which indebtedness shall continue under and be governed by the Notes and the documents, instruments and agreements executed pursuant hereto or in connection herewith. The Notes are a replacement, consolidation, amendment and restatement of the Prior Notes and ARE NOT A NOVATION.

(b) With respect to all loans outstanding under the Prior Agreement, the Borrower shall pay to each applicable Bank directly, on the Effective Date, the then outstanding principal balance of each such loan together with all accrued and unpaid Existing Interest with respect thereto and any amounts required pursuant to Section 2.11 of the Prior Agreement.

(c) The Borrower shall pay to each Bank directly, on the Effective Date, all Existing Fees then owed to such Bank.

(d) It is expressly agreed that each Bank shall deal directly with Borrower to obtain payment of the Existing Indebtedness, Existing Interest and Existing Fees owed to such Bank. The Agent shall have no responsibility for ensuring that Borrower makes any of the payments required pursuant to this
Section 2.8, or that the amount of any such payment is correct. The Agent shall have no liability to any Bank or to Borrower for any matter directly or indirectly related to any such payment.

Whenever any payment to be made under the Notes (other than principal of or any interest on LIBO Rate Loans), this

Agreement, or any other Loan Document shall be stated to be due on a day that is not a Business Day, such payment may be made on the next succeeding Business Day, and such extension of time in such case shall be included in the computation of payment of interest or fees, as the case may be.

(a) Subject to the other provisions of this Section 2.10, (i) during the Initial Term, the Revolving Credit Commitment and other obligations of each Bank under this Agreement with respect to Revolving Credit Loans shall terminate on the last day of the Initial Term, and (ii) during any Renewal Term (as defined in Section 2.10(b) below), the Revolving Credit Commitment and other obligations of each Bank under this Agreement with respect to Revolving Credit Loans shall terminate on June 30 of the year immediately following the year in which such Renewal Term commenced.

(d) Notwithstanding the foregoing provisions of this Section 2.10, upon the occurrence of an Event of Default, the provisions of Article IX hereof shall apply and the Agent may take any action permitted or required thereunder.

(e) The occurrence of the Termination Date shall not release, terminate or limit the rights or remedies of the Agent, or any Bank, or the obligations under this Agreement or any other Loan Document of Borrower, and such rights and remedies and such obligations shall survive until Borrower shall have fully paid and performed all its obligations hereunder and thereunder in full.

(a) Borrower shall pay, within 10 days after demand therefor, such amount as will compensate the Banks and the Swing Line Lender for any loss or reasonable expense they may sustain as a consequence of (i) the receipt or recovery or

conversion for any reason (including, without limitation, as a consequence of acceleration pursuant to Article IX hereof, a voluntary or mandatory prepayment pursuant to Section 2.5 hereof, or a mandatory conversion pursuant to Section 2.13 hereof) of all or any part of a Fixed Rate Loan prior to the last day of the applicable Interest Period, or Swing Line Interest Period, as the case may be, therefor, or (ii) any failure to borrow, convert to or continue any Fixed Rate Loan as such after submitting a Loan Request (whether oral or written) relating thereto, including, but not limited to, (A) any loss or expense sustained or incurred in liquidating or employing deposits from third parties acquired to effect or maintain a Fixed Rate Loan or any part thereof or (B) any loss of margin on reemployment of the funds so received or recovered.

(c) A certificate of any Bank or the Swing Line Lender, as the case may be, as to any additional amounts payable pursuant to this Section 2.11 setting forth in reasonable detail the basis and method of determining such amounts shall be conclusive, absent manifest error, as to the determination by such Bank set forth therein. A claim by any Bank or the Swing Line Lender for all or any part of any additional amount required to be paid by Borrower under this Section 2.11 may be made at any time and from time to time as often as the occasion therefor may arise.

(a) In the event, and on each occasion prior to the commencement of any Interest Period for any LIBO Rate Loans, (i) the Required Banks shall have notified the Agent that they have determined, or the Agent or Fleet shall have determined, that Dollar deposits in an amount comparable to the principal amount of such LIBO Rate Loan and having a scheduled maturity comparable to the Interest Period set forth in the related Loan

Request are not generally available in the London interbank market or (ii) the Agent or Fleet shall determine that reasonable means do not exist for ascertaining the LIBO Base Rate, the Agent, as soon as practicable thereafter, shall give oral notice of such determination to Borrower, promptly confirmed in writing (which may be by teletransmission). In the event of any such determination and until the Agent notifies Borrower (and provides a copy of this notice to the Banks) that the circumstances giving rise to such notice no longer exist, no Revolving Credit Loans or Term Loans will be made as LIBO Rate Loans and no Revolving Credit Loans or Term Loans will be converted to or continued as LIBO Rate Loans, but shall convert to Prime Rate Loans at the end of the applicable Interest Period, if any, therefor. Each determination by a Bank, or the Agent or Fleet, as the case may be, hereunder shall be conclusive absent manifest error.

(a) If, anything to the contrary herein contained notwithstanding, any applicable existing or future law, regulation, guideline, treaty or directive or condition or interpretation thereof (including, without limitation, any request, guideline or policy, whether or not having the force of law), by any Governmental Authority charged with the administration or interpretation thereof, or any change in any of the foregoing shall make it unlawful or improper for any Bank to make or maintain any Revolving Credit Loans or any Term Loan as LIBO Rate Loans, then, by oral notice to Borrower and the Agent, promptly confirmed in writing (which may be by teletransmission), such Bank may:

(i) declare that its Revolving Credit Loans or Term Loans thereafter will not be made by it as LIBO Rate Loans, whereupon Borrower shall be prohibited from requesting Revolving Credit Loans or Term Loans as LIBO Rate Loans unless and until such declaration is withdrawn; and

(ii) require that all its outstanding Revolving Credit Loans or its Term Loan that are LIBO Rate Loans be converted to Prime Rate Loans, in which event all such Revolving Credit Loans or Term Loans shall be converted automatically to Prime Rate Loan(s) as of the end of their applicable Interest Periods or as of such earlier date as may be required of such Bank for the lawful or proper conduct of its lending activities.

ARTICLE 3. FEES AND PAYMENTS

like funds as received to each Bank and the Swing Line Lender, as the case may be, pro rata according to its Exposure Percentage of such loans, and (b) each payment of the Commitment Fee shall be remitted by the Agent in like funds as received to each Bank pro rata according to such Bank's Revolving Credit Commitment.

(a) Any and all payments by Borrower pursuant to this Agreement, the Revolving Credit Notes, the Term Notes or the Swing Line Note shall be made, in accordance with the terms hereof and thereof, free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding franchise taxes imposed on the Agent, the Swing Line Lender or any Bank by the jurisdiction under the laws of which the Agent, the Swing Line Lender or such Bank is organized or any political subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as "Taxes"). If Borrower shall be required by law to deduct any Taxes from or in respect of any sum payable hereunder to the Agent, or the Swing Line Lender or any Bank, (i) the sum payable shall be increased as may be necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 3.3) the Agent, the Swing Line Lender or such Bank shall receive an amount equal to the sum it would have received had no such deductions been made, (ii) Borrower shall make such deductions, (iii) Borrower shall pay the full amount deducted to the relevant taxation authority or other authority in accordance with applicable law, and (iv) Borrower shall deliver to the Agent evidence of such payment to the relevant Governmental Authority.

(b) In addition, Borrower agrees to pay any present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies of the United States or any State or political subdivision thereof or any applicable foreign jurisdiction that arise from any payment made hereunder or from the execution, delivery or registration of, or otherwise with respect to, this Agreement or any other Loan Document (hereinafter referred to as "Other Taxes") and to deliver to the Agent and the Banks evidence of such payment to the relevant Governmental Authority.

(c) Borrower will indemnify the Agent, the Swing Line Lender and the Banks for the full amount of Taxes and Other Taxes (including without limitation Taxes and Other Taxes imposed by any jurisdiction on amounts payable under this Section 3.3) paid by the Agent, the Swing Line Lender or any Bank (as the case may be) and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally asserted. This indemnification shall be made within 10 days after written demand therefor by the Agent, the Swing Line Lender or any Bank. Should Borrower elect to contest whether or not the Taxes or Other Taxes giving rise to its indemnification obligation hereunder were correctly or legally asserted, the Agent, the Swing Line Lender or the Bank being indemnified agrees to cooperate in such contest, at Borrower's expense, and to make available to Borrower such books and records as may be reasonably necessary and useful in connection with such contest.

(d) Without prejudice to the survival of any other agreement of Borrower hereunder, the agreements and obligations of Borrower contained in this Section 3.3 shall survive the payment in full of principal, interest, fees and other amounts hereunder and under the other Loan Documents.

(e) Each Bank, if any, that is not organized under the laws of the United States of America or any State agrees (i) prior to the first payment to such Bank of any amounts due to such Bank under the Loan Documents, upon request by Borrower, to execute and deliver to Borrower completed counterparts of IRS Form W-8, 1001, or 4224 (or any successor thereto or substitute therefor), as applicable, and (ii) thereafter, upon request by Borrower from time to time in order to maintain the effectiveness and accuracy of such tax forms and otherwise to comply with United States tax laws, to execute and deliver to Borrower additional or supplemental tax forms

with respect to amounts due to such Bank under the Loan Documents.

ARTICLE 4. REPRESENTATIONS AND WARRANTIES

In order to induce the Agent, the Swing Line Lender and the Banks to enter into this Agreement and to make the Revolving Credit Loans, Swing Line Loans and Term Loans, Borrower hereby makes the following representations and warranties, which shall survive the execution and delivery of the Loan Documents and (except to the extent that any of such representations and warranties expressly relate to earlier dates) shall be deemed repeated and confirmed as of each date on which any Revolving Credit Loans, Swing Line Loans or Term Loans are requested by Borrower or made by any Bank or the Swing Line Lender, as the case may be:

Borrower is a duly organized and validly existing corporation in good standing under the laws of its state of incorporation, is properly licensed and has the corporate power and authority and the legal right to own its property and conduct the business in which it is engaged or presently proposes to engage and is duly licensed and qualified as a foreign corporation in good standing under the laws of each jurisdiction where the failure to qualify as such would have a Material Adverse Effect.

Except as set forth on Schedule III hereof (as the same may be amended from time to time to include entities the Tangible Net Worth of which constitute less than 5% of the Tangible Net Worth of Borrower), there are no corporations of which Borrower owns, directly or indirectly, shares of capital stock having in the aggregate 50% or more of the total combined voting power of the issued and outstanding shares of capital stock entitled to vote generally in the election of directors of such corporation; nor are there any corporations, partnerships, joint ventures or other entities in which Borrower has, or pursuant to any agreement has the right to acquire at any time by any means, directly or indirectly, an equity interest or investment.

Schedule I annexed hereto, as amended from time to time pursuant to
Section 6.9 hereof, completely and accurately lists all places (i) at which Borrower maintains its books and records relating to, among other things, its Loans, (ii) at which Borrower has any places of business and (iii) at which Borrower has its chief executive office.

Borrower has the corporate power and authority and the legal right to make, deliver and perform this Agreement and the other Loan Documents to which it is a party. Borrower has taken all necessary corporate action (including, but not limited to, the obtaining of any consent of stockholders required by law or by the Certificate of Incorporation or By-Laws of Borrower) to authorize the execution, delivery and performance of the Loan Documents to which it is a party or by which it is otherwise affected and to authorize the transactions contemplated hereby and thereby.

Each Loan Document, and each other instrument and document executed by Borrower and delivered to the Agent pursuant to Section 5.1 hereof, constitutes the legal, valid and binding obligation of Borrower, enforceable in accordance with its respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally, and general principles of equity, and there are no actions, suits or proceedings pending or, to the knowledge of Borrower, threatened against, or affecting, Borrower or any of its officers or directors calling into question the legality, validity or enforceability of any thereof.

Borrower is not in default under any indenture, mortgage, deed of trust, agreement or other instrument to which it is a party or by which it or any of its properties may be bound. Neither the execution and delivery of the Loan Documents nor any of the instruments and documents to be delivered by Borrower pursuant to this Agreement or the other Loan Documents, nor the consummation of the transactions herein and therein contemplated, nor compliance with the provisions hereof or thereof will violate any law or regulation, or any order or

decree of any court or governmental instrumentality, or will conflict with, or result in the breach of, or constitute a default under, any indenture, mortgage, deed of trust, agreement or other instrument to which Borrower is a party or by which it may be bound, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property of Borrower except as expressly permitted by this Agreement, or violate any provision of the Certificate of Incorporation, By-Laws or any preferred stock provisions of Borrower.

Borrower is not a party to any agreement or instrument or subject to any corporate restriction (including any restriction set forth in its Certificate of Incorporation, By- Laws or preferred stock provisions) that could have a Material Adverse Effect.

There are no actions, suits or proceedings pending or, to the knowledge of Borrower, threatened, against, or affecting Borrower or any of its officers or directors before any court, arbitrator or governmental or administrative body or agency which, if adversely determined, might have a Material Adverse Effect. No injunction, writ, restraining order or other order of any nature adverse to Borrower or the conduct of its business or inconsistent with the due consummation of such transactions has been issued by any Governmental Authority. Borrower is not in default under any applicable statute, rule, order, decree or regulation of any court, arbitrator or governmental body or agency having jurisdiction over Borrower.

Borrower has good and marketable title to all its properties and assets, subject to no Liens of any kind (except as expressly permitted under this Agreement).

Borrower does not own any "margin stock" as such term is defined in Regulation U as amended (12 C.F.R. Part 221), issued by the Board and is not obligated to register with the Board as a "lender" as such term is defined in Regulation G as amended (12 C.F.R. Part 207), issued by the Board. The proceeds of the

borrowings made pursuant to this Agreement will be used by Borrower only for the purposes set forth in Section 2.8 hereof. None of such proceeds and none of the proceeds of any loan or advance made by Borrower will be used, directly or indirectly, for the purpose of purchasing or carrying any margin stock or for the purposes of maintaining, reducing or retiring any Indebtedness that originally was incurred to purchase or carry margin stock or for any other purpose that might constitute any of the Revolving Credit Loans, Swing Line Loans or Term Loans under this Agreement or any such loans or advances a "Purpose credit" within the meaning of said Regulations G and U or Regulation X (12 C.F.R. Part 224) of the Board. Neither Borrower nor any agent acting in its behalf has taken or will take any action that might cause this Agreement or any of the documents or instruments delivered pursuant hereto or other Loan Documents to violate any regulation of the Board or to violate the Securities Exchange Act of 1933, as amended.

Borrower is, and has been since the date of its incorporation, a qualified SBIC. Borrower is in compliance with all conditions or requirements imposed by the SBA or any other applicable Governmental Authority with respect to its status as a SBIC including, without limitation, all conditions and requirements imposed under the SBI Act and the SBA Regulations promulgated thereunder.

Each of Borrower and Medallion Financial is an "investment company," as such term is defined in the 1940 Act. The acquisition of the Notes by the Banks, the application of the proceeds and repayment thereof by Borrower and the performance of the transactions contemplated by this Agreement and the other Loan Documents will not violate any provision of said Act, or any rule, regulation or order issued by the Securities and Exchange Commission thereunder.

No representation or warranty made by Borrower in any Loan Document or any other document furnished from time to time in connection herewith or therewith contains or will contain any untrue statement of a material fact or omits or will omit to state any material fact necessary to make the statements herein

or therein, in light of the circumstances under which they were made, not misleading. There is no fact known to Borrower or any of its officers or directors which has, or which in the future might have, in the reasonable judgment of Borrower, a Material Adverse Effect, except as set forth or referred to in this Agreement or in another document or instrument heretofore furnished to the Banks.

Borrower has filed or caused to be filed, all Federal, state and local tax returns and reports which are required to be filed and has paid all taxes shown to be due and payable on said returns or on any assessments made against it or any of its property and all other taxes, fees or charges imposed on it or any of its property by any Governmental Authority (other than those the amount or validity of which are currently being diligently contested in good faith by appropriate proceedings and in respect of which adequate reserves in conformity with GAAP have been provided on the books of Borrower); and no tax liens have been filed and, to the knowledge of Borrower, no claims are being asserted with respect to any such taxes, fees or other charges. Borrower, to the best of its knowledge, has paid and discharged all lawful claims for labor, material, supplies and anything else which might or could, if unpaid, become a Lien on any of its properties (other than those the amount or validity of which are currently being diligently contested in good faith by appropriate proceedings and in respect of which adequate reserves in conformity with GAAP have been provided on the books of Borrower).

Borrower possesses all the licenses, permits, approvals and consents of Federal, state and local governments and regulatory authorities) and rights in any thereof, adequate for the conduct of its business as now conducted, without conflict with the rights or claimed rights of others. Borrower has not received any notice nor does Borrower have any knowledge or reason to believe that any appropriate authority intends to cancel, terminate or modify any of such licenses or permits or that valid grounds for such cancellation, termination or modification exist.

No consent, authorization or action of, or filing with, any Governmental Authority or any other Person is required to authorize, or is otherwise required of Borrower in connection with, the execution, delivery, performance, validity or enforceability of the Loan Documents or any of the instruments or documents to be delivered pursuant to the Loan Documents.

(a) None of the Plans maintained at any time by Borrower, or any ERISA Affiliate thereof or the trusts created thereunder has engaged in a Prohibited Transaction which could subject any such Plan or trust to a material tax, liability or penalty on or resulting from Prohibited Transactions imposed under Code Section 4975 or ERISA.

(b) None of the Plans which are employee pension benefit plans maintained at any time by Borrower, or any ERISA Affiliate thereof, or the trusts created thereunder has been terminated in a manner that results or could result in a liability to Borrower in excess of $50,000, nor has Borrower, any ERISA Affiliate thereof, or any such Plan of Borrower or any ERISA Affiliate incurred any liability to the PBGC in excess of $50,000, other than for required insurance premiums which have been paid when due; neither Borrower nor any ERISA Affiliate has withdrawn from or caused a partial withdrawal to occur with respect to any Multiemployer Plan within the meanings of Sections 4203 and 4205 of ERISA the effect of which was a liability or potential liability to Borrower in excess of $50,000; and Borrower and each ERISA Affiliate has made or provided for all contributions to all employee pension benefit plans which they maintain and which were required under ERISA or the Code as of the end of the most recent fiscal year under each such plan; no such employee pension benefit plan has incurred any Accumulated Funding Deficiency the effect of which was a liability or potential liability to Borrower in excess of $50,000, whether or not waived; nor has there been any Reportable Event, or other event or condition which presents a risk of termination of any such Plan by the PBGC, which termination could result in a potential liability to Borrower in excess of $50,000.

(c) The present value of all accrued benefits under the Plans, if any, which are employee pension benefit plans did not, as of the most recent valuation date for each such Plan, exceed by more than $50,000 the then current value of the assets of such Plans allocable to such accrued benefits.

(d) Each employee pension benefit plan maintained by Borrower and each ERISA Affiliate has been administered in accordance with its terms and is in compliance in all material respects with all applicable requirements of ERISA and other applicable laws, regulations and rulings.

(e) As used in this Section 4.17 the term "employee Pension benefit Plan" and "accrued benefits" shall have the respective meanings assigned to them in ERISA.

The consolidated balance sheets of the Borrower for the fiscal years ended March 31, 1995, 1996 and 1997 and the related consolidated statements of income, retained earnings and cash flow for the fiscal years ended on said dates, as certified by the Independent Public Accountants present fairly the consolidated financial condition of the Borrower as at the date of each such balance sheet, and the results of its operations for such period. All such financial statements have been prepared in accordance with GAAP applied on a basis consistent with that of the comparable preceding period, and since the dates of the financial statements mentioned above, there has been no material adverse change in the consolidated condition, financial or otherwise, of the Borrower.

(a) All Property heretofore, now or hereafter owned or operated by Borrower complied, complies and will comply in all material respects with all applicable Federal, state and local, environmental, health and safety statutes, guidelines, codes, ordinances and regulations;

(b) such Property does not contain and is not being and has not been used to generate, manufacture, refine, produce, store, handle, transfer, process, dispose of, or transport, any Hazardous Materials in violation of any material applicable Federal, state or local law or regulation; and

(c) there are no underground storage tanks or surface impoundments located on, under, or within such Property in violation of any material applicable Federal, state or local law or regulation.

No event has occurred and is continuing that constitutes a Default or an Event of Default or would constitute such a Default or Event of Default after notice or lapse of time or both.

Borrower is Solvent, and will not, as a result of the transactions contemplated hereby or by the Loan Documents become not Solvent.

Except as otherwise permitted hereunder, the Agent, for the ratable benefit of the Banks, the Swing Line Lender and the CP Holders, has a valid and perfected first priority security interest (subject to the terms of the Intercreditor Agreement) in and to all Collateral, enforceable against Borrower and all third parties in all relevant jurisdictions and securing the payment of the Revolving Credit Loans, Swing Line Loans and Term Loans and all other sums payable under or in connection with the Loan Documents.

All advertising, origination and servicing activities, procedures and materials used with regard to any Loan made or accounts acquired, collected or serviced by Borrower comply with all applicable Federal, state and local laws, ordinances, rules and regulations, including but not limited to those related to usury, truth in lending, real estate settlement procedures, consumer protection, equal credit opportunity, fair debt collection, rescission rights and disclosures, except where failure to comply would not have a Material Adverse Effect.

The only transactions engaged in by Borrower in the ordinary course of its business consist of: (i) the making and servicing of Loans and Investments in compliance with the SBI Act and the SBA Regulations promulgated thereunder; and (ii) transactions incidental to the foregoing.

ARTICLE 5. CONDITIONS PRECEDENT

The obligation of (i) the Banks to make the Initial Revolving Credit Loan and (ii) the Swing Line Lender to make its first Swing Line Loan hereunder, are each subject to the satisfaction on the Effective Date of the following conditions precedent:

(ii) evidence satisfactory to the Banks that there is no outstanding Indebtedness or Liens except Permitted Indebtedness and Permitted Liens;

(v) evidence satisfactory to the Banks that the Borrower Financing Statements have been filed and confirmation thereof received in a form acceptable to the Required Banks, such that the security interests described therein constitute valid and perfected first priority security interests, subject only to Liens permitted pursuant to Section 8.1 hereof;

(vi) the results of a search of all filings made against Borrower under the UCC as in effect in any relevant state, indicating that the Collateral is free and clear of any Lien or encumbrance, other than Permitted Liens;

(viii) a copy of the Certificate of Incorporation of Borrower and all amendments thereto, certified as of the date hereof by the Chief Operating Officer of Borrower;

(ix) copies of the By-laws of Borrower in effect as of the Effective Date, certified by the Chief Operating Officer of Borrower;

(x) certified copies of the resolutions of the Board of Directors of Borrower approving each of the Loan Documents and each of the other instruments and documents to be executed by it and delivered to the Banks pursuant to this Agreement or any other Loan Document, certified by the Chief Operating Officer of Borrower, and certified copies of all documents evidencing other necessary corporate action and governmental approvals, if any, with respect thereto;

(xi) certificates of the Chief Operating Officer of Borrower certifying the names and true signatures of the officers of Borrower authorized to sign each document to which it is a signatory and which is to be delivered by it hereunder or pursuant to any other Loan Document to which it is a party;

(xii) a certificate of the Chief Executive Officer and the Chief Financial Officer of Borrower to the effect that (A) the financial statements referred to in Section 4.18 hereof present fairly the financial condition of Borrower as of the date and for the period of such financial statements and (B) no material adverse change in the condition,

financial or otherwise, of Borrower has occurred since the date of such financial statements;

(xiii) a certificate of an Authorized Representative of Borrower to the effect that Borrower has in effect all insurance coverage required pursuant to Section 6.3 hereof;

(xiv) originals of instruments and other documents constituting part of the Collateral or Underlying Collateral as the Agent may request in order to perfect its security interest, on behalf of the Banks, in such Collateral;

(xv) copies of all other documents, instruments and agreements requested by the Agent in connection with the transactions contemplated by this Agreement and the other Loan Documents; and

(b) Borrower is a corporation duly organized and validly existing, has all licenses, permits and authorizations necessary to own its properties and to carry on its business as now conducted and proposed to be conducted and is in good standing in the jurisdiction of its organization and in each other jurisdiction in which the nature of its business or ownership or use of its property requires such qualification and the Agent shall receive such evidence thereof, as it or the Required Banks may request.

(c) All requisite corporate action and proceedings, as the case may be, in connection with the Loan Documents shall be satisfactory in form and substance to the Agent and the Banks, and the Agent and the Banks shall have received all information and copies of all documents, including without limitation, records of requisite corporate action and proceedings which the Agent, the Banks and Emmet, Marvin & Martin, as counsel to the Agent, may have requested in connection therewith, such documents, where so requested, to be certified by appropriate corporate officers or Governmental Authorities.

(d) All necessary approvals, authorizations and consents, if any be required, of any Governmental Authority having jurisdiction with respect to any of the Collateral and the transactions contemplated by this Agreement and the other Loan Documents shall have been obtained. In addition, Borrower shall be in compliance with all laws, rules, regulations, orders and administrative guidelines applicable to the operation of its business, including, without limitation, those of the SBA.

(e) All representations, warranties, covenants and agreements contained in any Loan Document shall be true and correct in all material respects, and shall have been performed (to the extent required to be performed on or prior to the Effective Date), as of the Effective Date.

(f) Borrower shall have paid to each Bank the sums set forth in
Section 2.8 hereof that are required to be paid to such Bank on or before the Effective Date.

The obligation of the Banks to make any Revolving Credit Loans (including the Initial Revolving Credit Loan) and any Term Loans and the obligation of the Swing Line Lender to make any Swing Line Loan (including any initial Swing Line Loan) is further subject to the satisfaction of the following conditions precedent:

(a) each of the representations and warranties made by Borrower in or pursuant to any Loan Document or which are contained in any agreement, instrument, certificate, document or other writing furnished at any time under or in connection herewith or therewith shall be true and correct in all material respects when made and on and as of the date of the making of such Revolving Credit Loan or Term Loan or Swing Line Loan (except to the extent any representation or warranty expressly relates to an earlier date);

(b) no Default or Event of Default shall have occurred and be continuing on such date or after giving effect to the Revolving Credit Loans or Term Loans or Swing Line Loans to be made on such date;

(c) no event, act or condition having or causing a Material Adverse Effect with respect to Borrower has occurred since the Effective Date;

(d) after taking into account Revolving Credit Loans and/or Term Loans and/or Swing Line Loans to be made on such date, Net Finance Assets shall be in an amount at least equal to the Minimum Asset Coverage.

Each borrowing by Borrower hereunder shall constitute a representation and warranty by Borrower as of the date of such borrowing that the conditions in clauses (a), (b), (c) and (d) of this Section 5.2 have been satisfied.

ARTICLE 6. AFFIRMATIVE COVENANTS

Borrower covenants and agrees that, until the Notes together with interest and all other Indebtedness of Borrower to the Agent, the Swing Line Lender or the Banks under the Loan Documents are paid in full and the Aggregate Revolving Credit Commitment, the Swing Line Commitment and all Term Loan Commitments are terminated, unless specifically waived in writing by the Agent and the Required Banks:

Borrower shall furnish to the Agent and each Bank:

(a) as soon as practicable and in any event within 30 days after the close of each calendar quarter, beginning with the calendar quarter ending December 31, 1997, a detailed schedule of all outstanding Loans of Borrower setting forth (i) the aging, on a contractual basis, of each Loan and (ii) the aggregate dollar amount of Loans as to which any amendments or modifications to or waivers of any terms thereof have been made during the quarter as a result of the Person to whom such Loan was made being unable to comply (for whatever reason) with the terms thereof;

(b) as soon as practicable and in any event within 30 days after the close of each calendar quarter, beginning with the calendar quarter ending December 31, 1997, a schedule setting forth (i) the number of Medallion Rights pledged to Borrower as security for Loans made by it, (ii) the then outstanding aggregate principal amount of the Loans secured by such Medallion Rights and (iii) Borrower's good faith best

estimate (along with supporting documentation) of the current fair market value of the operating rights and licenses evidenced by taxi medallions included in such Medallion Rights;

(d) as soon as practicable and in any event within 60 days after the end of each of the first three fiscal quarters of each fiscal year, beginning with the fiscal quarter ending December 31, 1997, a balance sheet, a statement of income and retained earnings and a statement of cash flow of Borrower, as at the end of and for the quarterly period then ended and for the period commencing at the end of the previous fiscal year and ending with such quarter, setting forth the corresponding figures for the appropriate periods of the previous fiscal year in comparative form, all in reasonable detail (which detail shall include data as to non-accruals (and related collateral, repossessions, charge-offs and reconciliation for allowance for losses) and be reviewed by the Independent Public Accountants and certified by the President or Chief Financial Officer of Borrower to be true and correct and to have been prepared in accordance with GAAP (except for the omission of footnotes), subject to normal recurring year-end audit adjustments;

(e) as soon as practicable and in any event within 90 days after the end of the fiscal year of Borrower commencing with the fiscal year ending March 31, 1998, a balance sheet, a statement of income and retained earnings and a statement of cash flow of Borrower, as at the end of and for the fiscal year just closed, setting forth the corresponding figures of the previous fiscal year in comparative form, all in reasonable detail (which detail shall include data as to non-accruals and related collateral, repossessions, charge- offs and reconciliation for allowance for losses), presented in a manner consistent with the financial statements of Borrower for the preceding fiscal year, and, with respect to such consolidated statements, certified (without any qualification or exception deemed material by the Agent or any Bank) by the Independent Public Accountants; and concurrently with such financial statements, a written statement, addressed to the Agent and the Banks, signed by such Independent Public Accountant to the effect that, in making the examination necessary for their certification of such financial statements, they have not

obtained, as of the end of such fiscal year, any knowledge of the existence of any Default or Event of Default, or, if such accountants shall have obtained from such examination any such knowledge, they shall disclose in such written statement the Default or Event of Default;

(f) concurrently with the delivery of the schedules or financial statements required to be furnished under Sections 6.1(a), or 6.(d) hereof, a certificate signed by the President or Chief Financial Officer of Borrower, and concurrently with the delivery of the financial statements required to be furnished under Section 6.1(e) hereof, a certificate signed by the Independent Public Accountants, and promptly upon the occurrence of any Default or Event of Default, a certificate signed by the President or Chief Financial Officer of Borrower or such Independent Public Accountants, if a Default or Event of Default shall have occurred during the period of their review, in each case stating (i) that a review of the activities of Borrower during such period has been made under his or their, as the case may be, immediate supervision with a view to determining whether Borrower has observed, performed and fulfilled all of its obligations under this Agreement, and (ii) that there existed during such period no Default or Event of Default (provided that, as to a certificate prepared by the Independent Public Accountants, such period, as it relates to the compliance by Borrower with covenants contained in Articles VII and VIII hereof shall apply to the fiscal period covered by their review) or if any such Default or Event of Default exists, specifying the nature thereof, the period of existence thereof and what action Borrower proposes to take, or has taken, with respect thereto; each such certificate shall be accompanied by a schedule setting forth the computations as of the end of such period of the Debt-Equity Ratio (as defined under "Pricing Level") and of each of the financial ratios, tests or covenants specified in Article VII, 6.15, 8.2, 8.3, 8.4, and 8.14 hereof;

(g) concurrently with the delivery of the financial statements required to be furnished under Section 6.1(e) hereof, (i) any management letters prepared by the Independent Public Accountants described above, setting forth weaknesses in the accounting and control procedures of Borrower and (ii) projections (in a format satisfactory to the Agent) for the fiscal year immediately following the fiscal year for which such financial statements were provided;

(h) promptly upon receipt thereof, copies of (i) all financial reports (including, without limitation, management letters), if any, submitted to Borrower by its auditors in connection with each annual interim or special audit of its books by such auditors, (ii) all "vault count opinions" submitted to Borrower in connection with each inspection by such auditors of the documents evidencing Borrower's Loans and the Underlying Collateral securing such Loans, (iii) all audits submitted to Borrower by the SBA or any other Governmental Authority and (iv) all reports, letters or other documents submitted to Borrower by the SBA or any other Governmental Authority relating to a material change in Borrower's business or the rules and regulations promulgated by any Governmental Authority applicable thereto, including, without limitation, the SBI Act, the SBA Regulations, the 1940 Act and the Code;

(i) a Borrowing Base Certificate indicating a computation of the Minimum Net Finance Assets (as defined in Section 7.3) (i) monthly (not later than 10 Business Days after the last day of each month) covering the period ending the last day of the immediately preceding month, and (ii) on the date an extension of credit is requested, covering the period commencing with the first day of the month such extension of credit is requested through the date thereof; and

(j) with reasonable promptness, such other information respecting the business, operations and financial condition of Borrower as the Agent or any of the Banks from time to time reasonably may request.

(a) Borrower shall pay promptly when due, (i) all material sales, use, excise, personal property, income, withholding, corporate franchise and all other taxes, assessments and governmental charges upon or against or relating to Borrower or its ownership or use of any of its properties, assets, income or gross receipts unless and to the extent that such charges are being diligently contested in good faith by appropriate proceedings and adequate reserves in conformity with GAAP have been provided therefor on the books of Borrower, and (ii) all lawful claims, whether for labor, materials, supplies, services or anything else which might or could, if unpaid, become a Lien or charge upon the properties or assets of Borrower or any of its Subsidiaries, which Lien would not be permitted under this Agreement, unless and to the

extent such claims are being diligently contested in good faith by appropriate proceedings and adequate reserves in conformity with GAAP have been provided therefor on the books of Borrower.

(b) Borrower shall not permit, or suffer to remain, and will promptly discharge, any Lien (other than a Permitted Lien) arising from any unpaid tax, assessment, levy or governmental charge.

(c) In the event Borrower shall fail to pay any such tax, assessment, levy or governmental charge or to discharge any such Lien (other than a Permitted Lien), then the Agent, without waiving or releasing any obligation or default of Borrower hereunder, may at any time or times hereafter, but shall be under no obligation to do so, make such payment, settlement, compromise or release or cause to be released any such Lien, and take any other action with respect thereto which the Agent deems advisable. All sums paid by the Agent in satisfaction of, or on account of any tax, levy or assessment or governmental charge, or to discharge or release any Lien, and any expenses, including reasonable attorneys' fees actually incurred, court costs and other charges relating thereto, shall become a part of the Obligations secured by the Collateral, payable on demand.

(a) Borrower shall (i) keep all of its properties adequately insured at all times with responsible insurance carriers against loss or damage by fire and other hazards and (ii) maintain adequate insurance at all times with responsible carriers against liability on account of damage to persons and property and under all applicable workmen's compensation laws. For the purposes of this Section 6.3(a), insurance shall be deemed adequate if the same is not less extensive in coverage and amount than is customarily maintained by other persons engaged in the same or similar business similarly situated.

(b) Borrower, from time to time upon request of the Agent or any Bank, promptly shall furnish or cause to be furnished to the Agent and any such requesting Bank evidence, in form and substance satisfactory to the Agent and such Bank (if requested by a Bank), of the maintenance of all insurance required by this Section 6.3 to be maintained, including, but not limited to, such originals or copies as the Agent or such Bank may request of policies, certificates of insurance, riders

and endorsements relating to such insurance and proof of premium payments.

Borrower shall maintain, at all times, true and complete books, records and accounts in which true and correct entries shall be made of its transactions in accordance with GAAP consistently applied and in compliance with the regulations of any governmental regulatory body having jurisdiction over it.

Borrower shall keep its properties in good repair, working order and condition (subject to such wear and tear as may occur in the ordinary course of business) and, from time to time, make all needful and proper repairs, renewals, replacements, additions and improvements thereto, so that the business carried on may be properly and advantageously conducted at all times in accordance with prudent business management.

Borrower shall (a) make full and timely payments to the Agent, for the ratable benefit of the Banks, and the Swing Line

Lender, as the case may be, of the principal of and interest on the Notes and all other amounts owed by Borrower under or pursuant to the Loan Documents, whether now existing or hereafter arising and (b) duly comply with all the terms and covenants contained in each of the instruments and documents furnished in connection with or pursuant to this Agreement or the other Loan Documents, all at the times and places and in the manner set forth therein.

Borrower shall comply with all applicable laws and regulations, including but not limited to, those of the SBA and Federal, state and local laws and regulations relating to consumer lending, disclosure, collection and licensing where the failure to so comply would have a Material Adverse Effect (other than those the validity of which are being diligently contested in good faith by appropriate proceedings and adequate reserves in conformity with GAAP have been provided therefor on the books of Borrower).

Borrower shall promptly, but in no event later than three Business Days after obtaining knowledge thereof, give written notice to the Agent and the Banks of: (a) any material litigation, including arbitrations, and of any investigations or proceedings before any Governmental Authority brought against Borrower, whether or not the claim is considered by Borrower to be covered by insurance, which might, if determined adversely, have a Material Adverse Effect, or where the amount involved, when added together with all other amounts involved in any other litigation, investigation, arbitration or proceeding affecting Borrower, would exceed $500,000, and Borrower shall, if requested by the Agent or the Required Banks, set up such reserves as the Agent or the Required Banks reasonably determine are necessary to protect the Agent or the Banks against loss; (b) any written notice of a violation received by Borrower from any Governmental Authority which, if such violation were established, might have a Material Adverse Effect; (c) any material attachment, judgment, lien, levy or order which may be placed on or assessed against or threatened against Borrower or the Collateral; (d) any Default or Event of Default or any event that, after notice or lapse of time or both, would become a Default or Event of Default; (e) any other matter that has or causes or may have or cause a Material Adverse Effect with respect to Borrower; (f) any Change of

Control or proposed Change of Control; and (g) any change in the corporate name or corporate form of Borrower, or of any change in the information disclosed on Schedule I annexed hereto.

(a) Borrower shall keep all Property owned or operated by it free of Hazardous Materials and comply with the requirements of all applicable Federal, state and local environmental, health, safety and sanitation laws, ordinances, regulatory and administrative authorities with respect thereto. Except to the extent it does so on the date hereof and in strict compliance with all applicable laws, Borrower shall not use any Property to generate, manufacture, refine, transport, treat, store, handle, dispose, transfer, produce, process or in any manner deal with, Hazardous Materials, and shall not cause or permit, as a result of any intentional or unintentional act or omission on the part of Borrower or any occupant, tenant or subtenant, the installation or placement of Hazardous Materials onto any Property or onto any other property or suffer the presence of Hazardous Materials on any Property. Borrower shall undertake promptly and pursue diligently to completion appropriate remedial clean-up action in the event of any release of Hazardous Materials on, upon or into any real property owned or operated by Borrower or any real property adjacent thereto.

(b) Borrower agrees to provide the Banks with copies of any notifications of releases of Hazardous Materials that are given by or on behalf of Borrower to any Governmental Authority with respect to any real property owned or operated by Borrower. Such copies shall be sent to the Banks concurrently with the mailing or delivery of such copies to the Governmental Authority.

Upon the request of the Agent or the Required Banks, Borrower at its cost and expense shall duly execute and deliver, or cause to be duly executed and delivered, to the Agent and the Banks such further instruments and do and cause to be done such further acts as may be reasonably necessary or proper in the opinion of the Agent or the Required Banks to carry out more effectually the provisions and purposes of this Agreement and the other Loan Documents.

Borrower shall deliver to the Agent and the Banks, promptly after (i) the occurrence thereof, notice that an ERISA Termination Event or a Prohibited Transaction with respect to any Plan has occurred, which notice shall specify the nature thereof and Borrower's proposed response thereto, and (ii) actual knowledge thereof, copies of any notice of the PBGC's intention to terminate or to have a trustee appointed to administer any Plan.

Borrower shall do or cause to be done all things necessary to preserve, renew and keep in full force and effect its corporate existence (except as otherwise may be permitted by Section 8.6 hereof) and all rights, licenses, permits and franchises, the termination of which would have a Material Adverse Effect; comply with all laws, regulations, ordinances, rules and orders applicable to it, noncompliance with which would have a Material Adverse Effect; conduct and operate its business in substantially the manner in which it is presently conducted and operated without material alteration or change in the nature of such business; at all times maintain and preserve all property used or useful in the conduct of its business and keep the same in appropriate repair and condition, and from time to time make, or cause to be made, all appropriate repairs, renewals and replacements thereto, so that the business carried on in connection therewith may be properly conducted at all times.

Borrower shall maintain perfected, first priority security interests in the Collateral in favor of the Agent in accordance with the terms of the Borrower Security Agreement, subject only to the Liens permitted pursuant to
Section 8.1 hereof.

Borrower shall ensure that, for so long as any amounts are owed by it to the Banks, the Swing Line Lender or the Agent under the Loan Documents, at all times at least 65% of the aggregate principal amount of all Loans made by it and then outstanding shall be Eligible Medallion Loans to Persons who have obtained such Loans for the purpose of acquiring Medallion Rights for use primarily in New York City.

ARTICLE 7. FINANCIAL COVENANTS

Borrower covenants and agrees that, until the Notes, together with interest and all other Indebtedness of Borrower to the Agent, the Swing Line Lender or the Banks under this Agreement and the other Loan Documents, are paid in full and the Aggregate Revolving Credit Commitment, the Swing Line Commitment and all Term Loan Commitments are terminated, Borrower shall not, without the prior written consent of the Agent and the Required Banks:

Suffer or permit Tangible Net Worth to be less than (i) $45,000,000 at any time prior to the Merger becoming effective and (ii) $65,000,000 on the date the Merger becomes effective and at all times thereafter.

Suffer or permit the ratio of Total Liabilities to Tangible Net Worth to be more than 4:1 at any time.

Suffer or permit the ratio of Net Finance Assets to Senior Debt to be less than 1.20:1 at any time.

Suffer or permit the ratio, on a rolling four quarter basis, of (a) Net Income plus Interest Expense to (b) Interest Expense to be less than 1.35:1.

ARTICLE 8. NEGATIVE COVENANTS

Borrower covenants and agrees that until the Notes together with interest and all other Indebtedness of Borrower to the Agent, the Swing Line Lender or the Banks under this Agreement are paid in full and the Aggregate Revolving Credit Commitment, the Swing Line Commitment and all Term Loan Commitments are terminated, Borrower shall not, without the prior written consent of the Agent and the Required Banks:

Create, assume or suffer to exist any Lien upon any of its property or assets, whether now owned or hereafter acquired; provided, however, that the foregoing restriction and limitation shall not apply to the following Liens (the "Permitted Liens"):

(a) Liens created under the Borrower Security Agreement or other Liens in favor of the Agent or the Banks;

(b) Liens existing on property at the time acquired by Borrower after the date of the financial statements referred to in Section 4.18 hereof,

(c) Liens constituting renewals, extensions or refundings of Liens permitted by clause (b) above, provided that the principal amount of the Indebtedness secured by any such new Lien does not exceed the principal amount of the Indebtedness being renewed, extended or refunded at the time of renewal, extension or refunding thereof and that such new Lien attaches only to the same property theretofore subject to such earlier Lien;

(d) Liens securing taxes, assessments or governmental charges or levies, or the claims or demands of materialmen, mechanics, carriers, workmen, repairmen, warehousemen, landlords and other like Persons, not yet delinquent or which are being actively contested in good faith by appropriate proceedings and in respect of which adequate reserves in conformity with GAAP have been provided on the books of Borrower;

(e) other Liens incidental to the conduct of its business or the ownership of its property and assets which were

not incurred in connection with the borrowing of money or the obtaining of advances or credit, and which do not in the aggregate materially detract from the value of its property or assets, or materially impair the use thereof in the operation of its business;

(f) attachment, judgment and other similar Liens arising in connection with court proceedings, provided that execution or other enforcement of such Liens is effectively stayed, the claims secured thereby are being actively contested in good faith by appropriate proceedings and adequate reserves in conformity with GAAP have been provided on the books of Borrower;

(g) Liens arising in connection with, and securing the cost of, the acquisition of Equipment, provided, that such Lien attaches to such Equipment concurrently with or within 90 days after the acquisition thereof (by purchase, construction or otherwise), and provided, further, that the aggregate amount of Indebtedness securing all such Liens shall not at any time exceed $1,000,000; and

(h) Liens on SBA Collateral securing the SBA Secured Debt, subject to the terms and conditions of the Intercreditor Agreement.

Create, incur, assume or suffer to exist, contingently or otherwise, any Indebtedness, except:

(a) Indebtedness of Borrower to the Agent, the Swing Line Lender and the Banks arising hereunder or under any of the other Loan Documents;

(b) Permitted Debt and Subordinated Debt of Borrower;

(d) Indebtedness secured by Liens described in Section 8.1(b), (c) or (g) hereof; and

(e) Unsecured current liabilities incurred in the ordinary course of business and paid within 90 days after the due date thereof (unless diligently contested in good faith by appropriate proceedings and, if requested by the Agent,

reserved against in conformity with GAAP) other than liabilities that are for money borrowed or are evidenced by bonds, debentures, notes or other similar instruments.

SECTION 8.3. Limitation on Loans and Investments.

(a) Make, or obligate itself to make, (i) any loan or advance or Investment that is not a Domestic Loan or a Domestic Investment, or (ii) without the prior written consent of the Agent and the Required Lenders (which consent shall not be unreasonably withheld), any Portfolio Purchase.

(b) Make, or obligate itself to make, any loan or advance or Investment that is not in compliance with the rules and regulations promulgated by any Governmental Authority to which it is subject, including, without limitation, the SBI Act and the SBA Regulations promulgated thereunder and the 1940 Act.

(c) Make, or obligate itself to make, any Loan if, after giving effect to such Loan, the aggregate outstanding principal amount of all Loans made to any one Person together with its Affiliates would exceed 20% of Borrower's Tangible Net Worth plus Subordinated Debt.

(d) Make, or commit to make, or acquire or commit to acquire, any Commercial Loan to or from any Person if, as a result of such Loan, Borrower's Commercial Loan concentration in any given industry (determined in accordance with the Standard Industrial Classification promulgated by the Office of Management and Budget) would exceed in principal amount 25% of Borrower's total Loans outstanding.

Own, beneficially or of record, or obligate itself to own, beneficially or of record, directly or indirectly, 50% or more of the Voting Interests of any corporation the Tangible Net Worth of which constitute more than 5% of the Tangible Net Worth of Borrower.

Make, or obligate itself to make, any Restricted Payment.

(a) Sell, discount or otherwise dispose of Loans or any Collateral if a Default or Event of Default has occurred and is continuing or if the effect of such sale, discount or disposal would be to put Borrower in violation of any of the covenants and agreements contained in this Agreement;

(b) Sell or otherwise dispose of an amount of Loans which, in aggregate principal amount, exceeds 10% of the aggregate principal amount of all Loans of Borrower then outstanding unless, immediately upon such sale or disposition, Borrower makes, in accordance with the provisions of Section 2.5(a) hereof, a voluntary prepayment on all then outstanding Revolving Credit Loans and Term Loans equal to the aggregate principal amount, plus accrued interest, of the Loans so sold or disposed.

(c) Enter into any transaction of merger or consolidation, or transfer, sell, assign, lease, or otherwise dispose of all or substantially all of its properties or assets to any Person, except that the Borrower may merge or consolidate with any other Person, provided that (A) Borrower shall be the surviving and continuing corporation, (B) no Default or Event of Default shall have occurred and be continuing and (C) after giving effect to such consolidation or merger, Borrower would be Solvent and would have Tangible Net Worth at least equal to the Tangible Net Worth Borrower had immediately before such consolidation or merger.

Transfer, or commit itself to transfer, any portion of the proceeds of the Revolving Credit Loans, Swing Line Loans and Term Loans to be made to Borrower from time to time hereunder to Medallion Financial, except as may be necessary in order for Borrower to pay and make to Medallion Financial its normal and customary dividends and distributions; provided that such dividends or distributions do not cause Borrower to be in violation of any of the covenants and agreements contained in this Agreement.

Take any of the following actions or permit any of the following events to exist if, as a result thereof, Borrower would, or would be likely to, incur a liability in excess of $50,000; terminate, or permit or suffer any of its ERISA

Affiliates to terminate (other than a standard termination, as defined in
Section 4041(b) of Title IV of ERISA, of a Single Employer Plan), any Plans maintained by Borrower or any of its ERISA Affiliates so as to incur any liability to the PBGC; permit or suffer to exist any Prohibited Transaction involving any of such Plans or any trust created thereunder which would subject Borrower to a tax, liability or penalty on Prohibited Transactions imposed under Code Section 4975 or ERISA; fail to pay, or permit or suffer any of its ERISA Affiliates to fail to pay, to any such Plan (including any multiemployer plan) any contribution which it or such ERISA Affiliate is obligated to pay under the terms of such Plan; permit any Accumulated Funding Deficiency, whether or not waived, with respect to any Plan; or permit or suffer to exist any occurrence of a Reportable Event, or any other event or condition, which presents a material risk of termination by the PBGC of any such Plan.

Materially change or alter the nature of its business as conducted as of the Effective Date.

Consent to any amendment, supplement, or other modification of any of the terms (including acceleration, covenant, default, subordination, sinking fund, repayment, interest rate or redemption provisions) contained in, or applicable to, or any security for, any Permitted Debt or other instrument evidencing or applicable to Permitted Debt (including, without limitation, the SBA Security Agreement) if such amendment, supplement, or other modification materially adversely affects the interests of the Agent, the Documentation Agent, the Swing Line Lender or any Bank.

Enter into, or cause, suffer, or permit to exist, any material transactions, including, without limitation, the purchase, sale, lease or exchange of any property or the rendering of any service, with any Affiliate on terms that are less favorable to Borrower than those that would be obtainable at the time from any Person who is not an Affiliate.

Enter into any agreement (excluding this Agreement and the other Loan Documents) prohibiting the creation or assumption of any Lien upon its properties, revenues, or assets, whether now owned or hereafter acquired.

Enter into any agreement containing any provisions which would be violated or breached by any borrowing hereunder or by the performance by Borrower of its obligations under any of the Loan Documents where the potential consequences of such violation or breach would have a Material Adverse Effect.

Expend or commit to expend for itself more than an aggregate of $500,000 in any fiscal year for capital expenditures, for the acquisition of Equipment or for leasehold improvements.

(i) At any time allow the aggregate outstanding principal balance of the SBA Collateral to exceed the Maximum SBA Collateral at such time, or (ii) update Exhibit H hereto (or Schedule A to the SBA Security Agreement) (a) more often than monthly (as provided in Section 6.1(c) hereof, or (b) at any time a Default or an Event of Default shall occur and be continuing or be caused as a result of updating such Exhibit H (Schedule A).

ARTICLE 9. DEFAULTS AND REMEDIES

If any one or more of the following events (herein called "Events of Default") shall occur for any reason whatsoever (and whether such occurrence shall be voluntary or involuntary or come about or be effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body), that is to say:

(a) if default shall be made in the due and punctual payment of the principal of or interest on any of the Revolving Credit Loans, Swing Line Loans or Term Loans or any other amounts due and owing to the Agent, the Swing Line Lender or

the Banks, when and as the same shall become due and payable and, with respect to defaults in payment other than payment of principal, such default shall continue for more than five days;

(b) if default shall be made in the performance or observance of, or shall occur under, any covenant, agreement or provision contained in Article VII or Sections 6.9(d), 6.13, 6.14, 8.1, 8.2, 8.5, 8.6, 8.9, 8.10 or 8.12 hereof;

(c) if default shall be made by Borrower in the performance or observance of, or shall occur under, any other covenant, agreement or provision of this Agreement (other than Section 6.7 hereof) and such default shall not have been remedied within 30 days after such failure shall first have become known to any officer of Borrower;

(d) if default shall be made by Borrower in the performance or observance of, or shall occur under, any covenant, agreement or provision of any other Loan Document or in any other agreement, instrument or document delivered to the Agent, the Documentation Agent, the Swing Line Lender or the Banks and such default shall not have been remedied within such grace or cure period, if any, as may be provided therefor;

(f) if Borrower shall (i) default in the payment of any principal, interest or premium with respect to any Indebtedness for borrowed money or any obligation which is the substantive equivalent thereof in excess of $50,000, other than Indebtedness under the Revolving Credit Loans, the Swing Line Loans, or the Term Loans, and such default shall continue for more than the period of grace, if any, therein specified or (ii) default in the performance or observance of any other term, condition or agreement contained in any such obligation or in any agreement relating thereto if the effect thereof is to cause, or permit the holder or holders of such obligation (or a trustee on behalf of such holder or holders) to cause, such obligation to become due prior to its stated maturity;

(g) if any representation or warranty or any other statement of fact herein or in the other Loan Documents, or in connection with the transactions contemplated hereby or thereby, or in any writing, certificate, report or statement at any time furnished by Borrower to the Agent, the Documentation Agent, the Swing Line Lender or any Bank pursuant to or in connection with this Agreement or the other Loan Documents

shall prove to have been false or misleading in any material respect when made;

(h) if Borrower shall file a petition or seek relief under or take advantage of any insolvency law; make an assignment for the benefit of its creditors; commence a proceeding for the appointment of a receiver, trustee, liquidator, custodian or conservator of itself or of the whole or substantially all of its property; file a petition or an answer to a petition under any chapter of the United States Bankruptcy Code, as amended (11 U.S.C. (S) 101 et seq.), or file a petition or seek relief under or take advantage of any other similar law or statute of the United States of America, any state thereof or any foreign country;

(i) if a court of competent jurisdiction shall enter an order, judgment or decree appointing or authorizing a receiver, trustee, liquidator, custodian or conservator of Borrower or of the whole or substantially all of its property, or enter an order for relief against Borrower in any case commenced under any chapter of the United States Bankruptcy Code, as amended, or grant relief under any other similar law or statute of the United States of America, any state thereof or any foreign country; or if, under the provisions of any law for the relief or aid of debtors, a court of competent jurisdiction or a receiver, trustee, liquidator, custodian or conservator shall assume custody or control or take possession of Borrower or of the whole or substantially all of its property; or if there is commenced against Borrower any proceeding for any of the foregoing relief or if a petition is filed against Borrower under any chapter of the United States Bankruptcy Code, as amended, or under any other similar law or statute of the United States of America or any state thereof or any foreign country and such proceeding or petition remains undismissed for a period of 60 days; or if Borrower by any act indicates its consent to, approval of or acquiescence in any such proceeding or petition;

(j) if any judgment or judgments against Borrower or any attachment or execution against any of its property for any amount or amounts in excess of $50,000 in the aggregate remains unpaid, unstayed, undismissed or unbonded for a period of more than 30 days;

(k) (i) any Person shall engage in any Prohibited Transaction involving any Plan, (ii) any Accumulated Funding Deficiency, whether or not waived, shall exist with respect to

any Plan, (iii) a Reportable Event shall occur with respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be appointed, to administer or to terminate, any Single Employer Plan, which Reportable Event or commencement of proceedings or appointment of a trustee is, in the reasonable opinion of the Required Banks likely to result in the termination of such Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for purposes of Title IV of ERISA (other than a standard termination as defined in Section 4041(b) thereof), (v) Borrower or any of its ERISA Affiliates shall, or is, in the reasonable opinion of the Agent or the Required Banks, likely to, incur any liability in connection with a withdrawal from, or the insolvency or reorganization of, a Multiemployer Plan or (vi) any other event or condition shall occur or exist with respect to a Plan; and in case in clauses (i) through (vi) above, such event or condition, together with all other such events or conditions, if any, could subject Borrower to any tax, penalty or other liabilities in the aggregate material in relation to the business, operations, property or financial or other condition of Borrower;

(1) if there shall occur any change in the Collateral or in the business of Borrower, or its operation, conduct or prospects thereof, that individually or in the aggregate, could have or result in a Material Adverse Effect; or

(m) if there shall occur a Change of Control;

then, in the case of an Event of Default described in clause (h) or (i) above, the Aggregate Revolving Credit Commitment, the Swing Line Commitment, and each Term Loan Commitment shall automatically terminate and (i) the unpaid balance of the Revolving Credit Notes, the Swing Line Note, the Term Notes and all interest accrued thereon, and (ii) any accrued and unpaid fees and expenses due and payable hereunder or under any other Loan Document shall automatically (without any action on the part of the Agent or the Banks and without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived) forthwith become due and payable, and, in the case of any other Event of Default, then and in any such event, and at any time thereafter, if such or any other Event of Default shall then be continuing the following action may be taken: the Agent may (but shall not be obligated to, and upon the direction of the Required Banks shall, declare (i) the Aggregate Revolving Credit Commitment, the Swing Line

Commitment and all Term Loan Commitments to be terminated, whereupon the obligation of the Agent the Banks and the Swing Line Lender to make further Revolving Credit Loans or Term Loans or Swing Line Loans, as the case may be, hereunder shall terminate immediately and (ii) the Revolving Credit Notes, Swing Line Note and Term Notes to be due and payable, whereupon the maturity of the then unpaid balance of the Revolving Credit Notes, Swing Line Note and Term Notes shall be accelerated and the same, and all interest accrued thereon and any accrued and unpaid fees and expenses due and payable hereunder, shall forthwith become due and payable without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived, anything contained herein or in Revolving Credit Notes, Swing Line Note or Term Notes to the contrary notwithstanding.

In case any one or more Events of Default shall occur and be continuing, the Agent may (but shall not be obligated to), and at the request of the Required Banks shall, proceed to protect and enforce the rights or remedies of the Agent, the Documentation Agent, the Swing Line Lender and the Banks either by suit in equity or by action at law, or both, whether for the specific performance of any covenant, agreement or other provision contained herein, in the other Loan Documents, or in any document or instrument delivered in connection with or pursuant to this Agreement or the other Loan Documents or to enforce the payment of the Notes or any other legal or equitable right or remedy.

No right or remedy herein conferred upon the Banks, the Swing Line Lender, the Documentation Agent, or the Agent is intended to be exclusive of any other right or remedy contained herein or in the other Loan Documents or in any instrument or document delivered in connection with or pursuant to this Agreement or the other Loan Documents, and every such right or remedy shall be cumulative and shall be in addition to every other such right or remedy contained herein and therein or now or hereafter existing at law or in equity or by statute, or otherwise.

No course of dealing between Borrower and any of the Banks, the Swing Line Lender, the Documentation Agent or the Agent or any failure or delay on the part of any Bank, the Swing Line Lender or the Agent in exercising any rights or remedies hereunder shall operate as a waiver of any rights or remedies of such or any other Bank, the Swing Line Lender, the Documentation Agent or the Agent and no single or partial exercise of any rights or remedies hereunder shall operate as a waiver or preclude the exercise of any other rights or remedies hereunder.

In the event that the Revolving Credit Commitments, the Swing Line Commitment and the Term Loan Commitments shall have been terminated or the Revolving Credit Loans, Swing Line Loans and the Term Loans and all other amounts owing under the Loan Documents shall have been declared due and payable pursuant to the provisions of this Section, any funds received by the Agent, the Swing Line Lender and the Banks from or on behalf of the Borrower shall be remitted to, and applied by, the Agent in the following manner and order: (a) first, to the payment of interest on, and then the principal portion of, any Revolving Credit Loans or Term Loans which the Agent may have advanced on behalf of any Bank for which the Agent has not then been reimbursed by such Bank or the Borrower; (b) second, to reimburse the Agent, the Documentation Agent and the Swing Line Lender for any expenses due from the Borrower pursuant to the provisions of Section 10.6, (c) third, to the payment of the outstanding principal amount of the Swing Line Loans (together with all interest thereon), (d) fourth, to the payment of the Fees, (e) fifth, to the payment of any other fees, expenses or amounts (other than the principal of and interest on the Revolving Credit Loans, Swing Line Loans or Term Loans) payable by the Borrower to the Agent, the Documentation Agent, the Swing Line Lender or any of the Banks under the Loan Documents, (f) sixth, to the payment, pro rata according to the Exposure Percentage of each Bank, of interest due on the Revolving Credit Loans and Term Loans, (g) seventh, to the payment, pro rata according to Exposure Percentage of each Bank, of principal on the Revolving Credit Loans and Term Loans, of such principal, (h) eighth, any remaining funds shall be paid to whomsoever shall be entitled thereto or as a court of competent jurisdiction shall direct.

ARTICLE 10. MISCELLANEOUS

In the event that the Banks, the Swing Line Lender, the Agent or the Documentation Agent or any of them shall retain or engage an attorney or attorneys to collect or enforce or protect its interests with respect to this Agreement, any of the other Loan Documents, or any instrument or document delivered pursuant to this Agreement or the other Loan Documents, including, without limitation, each of the documents referred to in Section 5.1 hereof, or to protect the rights of any holder or holders with respect thereto, Borrower shall pay, within 10 days after demand therefor, all of the costs and expenses of such collection, enforcement or protection, including reasonable attorneys' fees actually incurred and disbursements, and the Agent on behalf of such Banks, the Agent on behalf of the Swing Line Lender, the Swing Line Lender, the Agent or the Documentation Agent or the holders of such Notes, as the case may be, may take judgment for all such amounts, in addition to the unpaid principal balance of the Notes and accrued interest thereon and any accrued and unpaid fees and expenses due and payable hereunder.

(a) no such amendment, supplement, modification, waiver or consent shall, without the consent of all of the Banks, (i) increase the Revolving Credit Commitment or Term Loan Commitment of any Bank or the Aggregate Revolving Credit Commitment or the Adjusted Aggregate Revolving Credit Commitment, (ii) decrease the rate, or extend the time of payment, of interest of, or change or forgive the principal amount or extend the time of payment of, any Revolving Credit Loan or Term Loan, or decrease the rate, or extend the time of payment, of the Commitment Fee, (iii) change the provisions of Sections 3.3, 9.1, this 10.2, or 10.9, change the definition of "Eligible Loan," "Required Banks," "Event of Default,"

"Prime Rate," "Adjusted LIBO Rate" "Minimum Asset Coverage" "Revolving Credit Commitment Periods," "Revolving Credit Loans," "Term Loans," "Term Loan Commitment" and all defined terms included in such definitions, (iv) change any of the provisions of Article II (other than Sections 2.8(e) and 2.14 thereof) or Article III hereof, or (v) change the Borrower Security Agreement, change the Intercreditor Agreement (in any material respect), or release all or substantially all of the Collateral, or (vi) change any provision hereof which expressly requires the consent, approval or waiver by all Banks;

(b) without the written consent of the Agent, or the Documentation Agent, as applicable, no such amendment, supplement, modification or waiver shall amend, modify or waive any provision of Article 11 or otherwise change any of the rights or obligations of the Agent or the Documentation Agent hereunder or under the Loan Documents;

(c) without the written consent of the Swing Line Lender, no such amendment, supplement, modification or waiver shall change the Swing Line Commitment or change any other term or provision that relates to the Swing Line Commitment or the Swing Line Loans; and

(d) none of the following shall require the consent, authorization or approval of Borrower: (i) amendment or modification of any agreement to which Borrower is not a party, and (ii) with respect to the agency relationship between the Agent and the Banks, Article XI (other than Section 11.4) hereof.

Any such amendment, supplement, modification or waiver shall apply equally to the Agent, the Documentation Agent, the Swing Line Lender, and each of the Banks and shall be binding upon the parties to the applicable Loan Document, the Banks, the Swing Line Lender, Agent, the Documentation Agent and all future holders of the Revolving Credit Loans, Term Loans and/or Swing Line Loans. In the case of any waiver, the parties to the applicable Loan Document, the Banks, the Swing Line Lender, the Documentation Agent and the Agent shall be restored to their former position and rights hereunder and under the Loan Documents to the extent provided for in such waiver, and any Default waived shall not extend to any subsequent or other Default, or impair any right consequent thereon. The Loan Documents may not be amended orally or by any course of conduct. No notice to or demand on Borrower in any case shall entitle Borrower to any other or further notice or demand in similar or other circumstances.

THIS AGREEMENT, THE REVOLVING CREDIT NOTES, THE SWING LINE NOTE AND THE TERM NOTES AND THE RIGHTS AND DUTIES OF THE PARTIES THEREUNDER AND WITH RESPECT TO INTEREST, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE LAWS OF ANOTHER JURISDICTION ARE MANDATORILY APPLICABLE TO THE EXERCISE OF REMEDIES OR THE PERFECTION OF SECURITY INTERESTS UNDER THE UCC.

All accounting terms not specifically defined herein shall be construed in accordance with GAAP, consistently applied. Where any accounting determination or calculation is required to be made under this Agreement, such determination or calculation (unless otherwise provided) will be made in accordance with GAAP, consistently applied except that if because of a change in GAAP, Borrower would have to alter a previously utilized accounting method or policy in order to

remain in compliance with GAAP, such determination or calculation will continue to be made in accordance with Borrower's previous accounting methods or policy. Unless otherwise specified herein all financial statements required to be delivered hereunder, shall be prepared and all financial records shall be maintained in accordance with GAAP.

(a) Borrower agrees to pay on demand all reasonable out-of-pocket costs and expenses incurred by the Banks, the Swing Line Lender, the Agent and the Documentation Agent in connection with the preparation, administration, filing and recording of any amendments, waivers or consents which may be requested by Borrower, all out-of-pocket costs and expenses, if any, in connection with the preparation, administration and enforcement (whether in the context of a civil action, adversary proceeding, workout or otherwise) of this Agreement, the other Loan Documents, and such other instruments and documents, including, without limitation, reasonable attorneys' fees actually incurred, audit charges, appraisal fees, search fees and filing fees and all out-of-pocket costs and expenses (including, without limitation, reasonable attorneys' fees) of the Agent in connection with its duties as Agent under this Agreement, the Borrower Security Agreement and the other Loan Documents. Borrower also agrees to pay on demand all reasonable attorneys' fees actually incurred, and any expenses, costs and charges relating thereto of the Agent if at any time or times hereafter the Agent employs counsel for advice with respect to this Agreement or the other Loan Documents, or to intervene, file a petition, answer, motion or other pleading in any suit or proceeding relating to this Agreement or any other Loan Document (including, without limitation, the interpretation or administration, or the amendment, waiver or consent with respect to any term, of this Agreement or the other Loan Documents) or to represent the Agent in any pending or threatened litigation with respect to the affairs of Borrower in any way relating to any the Borrower's obligations hereunder or to enforce any rights of the Agent, the Documentation Agent or any Bank or the Swing Line Lender or liabilities of Borrower, any Person to whom Borrower has made a Loan, or any Person which may be obligated to the Agent or the Banks or the Swing Line Lender by virtue of this Agreement or any other Loan Document, instrument or document now or hereafter delivered to the Agent, the Documentation Agent or any Bank or the Swing Line Lender by or for the benefit of Borrower. Borrower agrees to be responsible for payment of the amounts referred to in this Section 10.6 whether or not any

Revolving Credit Loans, Swing Line Loans or Term Loans are made hereunder.

EACH OF BORROWER, THE AGENT, THE DOCUMENTATION AGENT, THE SWING LINE LENDER AND THE BANKS HEREBY WAIVES TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR ANY INSTRUMENT OR DOCUMENT DELIVERED PURSUANT TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS, OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF, OR ANY OTHER CLAIM OR DISPUTE, HOWSOEVER ARISING, BETWEEN BORROWER AND ANY OF THE BANKS, THE DOCUMENTATION AGENT, THE SWING LINE LENDER OR THE AGENT, BETWEEN ANY BANKS, AND BETWEEN THE AGENT AND/OR THE DOCUMENTATION AGENT AND ANY BANKS; AND BORROWER HEREBY WAIVES THE RIGHT TO INTERPOSE ANY SETOFF, COUNTERCLAIM OR CROSS-CLAIM IN CONNECTION WITH ANY SUCH LITIGATION, IRRESPECTIVE OF THE NATURE OF SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL

OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER
ACTION).

The captions of the various sections and paragraphs of this Agreement have been inserted only for the purpose of convenience; such captions are not a part of this Agreement and shall not be deemed in any manner to modify, explain, enlarge or restrict any of the provisions of this Agreement.

(c) Borrower expressly consents to the foregoing arrangements in
Section lO.9(b) and agrees that any holder of a participation in a Note so acquired may exercise any and ail rights of banker's lien, setoff, counterclaim or otherwise with respect to any and all monies owing by such holder to Borrower as fully as if such holder were a holder of a Note in the amount of such participation. If all or any portion of any such excess payment is thereafter recovered from the holder which received the same, the purchase provided for in Section lO.9(b) shall be rescinded to the extent of such recovery, without interest.

(d) Each Bank and the Swing Line Lender agrees that if and to the extent that any amount received by the Agent, the Swing Line Lender or any Bank from Borrower or any other obligor or from the Collateral is subsequently invalidated, declared to be fraudulent or preferential, set aside or judicially required to be repaid to a trustee, receiver or any other person under any applicable creditors' remedy proceeding, including without limitation any bankruptcy proceeding, the other Banks hereto shall purchase from the Bank or Swing Line Lender from which said amount is recovered an additional participation in such amount equal to such Bank's Exposure Percentage of that amount. The amount invalidated, declared to be fraudulent or preferential, set aside or judicially required to be repaid to a trustee, receiver or any other person under any applicable creditors' remedy proceeding shall be deemed to be an amount immediately due and owing from Borrower.

As Security for the payment of any and all sums owing under the Notes and all other obligations of Borrower (i) hereunder and the other Loan Documents and (ii) under the CP Debt, Borrower shall execute and deliver to the Agent, the Banks, the Swing Line Lender and the CP Holders, on the Effective Date, the Borrower Security Agreement and grant to the Agent, on behalf of the Banks, the Swing Line Lender and the CP Holders, a security interest in all of its interests in the Collateral and Underlying Collateral and cause to be properly filed in all pertinent jurisdictions the Borrower Financing Statements. The security interest in such Collateral shall be subject to the terms and conditions of the

Intercreditor Agreement, which by their signature below, each Bank and the Swing Line Lender consent to the Agent entering into.

Borrower hereby irrevocably consents to the non-exclusive jurisdiction of the courts of the State of New York, County of New York and of any Federal Court located in the Southern District of New York, and agrees that venue in each of such Courts is proper, in connection with any action or proceeding arising out of or relating to this Agreement, the other Loan Documents, or any document or instrument delivered pursuant to this Agreement or the other Loan Documents. In any such action or proceeding, Borrower waives personal service of any summons, complaint or other process and agrees that the service thereof may be made by certified or registered mail directed to Borrower at its address set forth in Section 10.4 hereof. Nothing herein shall affect the right of the Agent, the Documentation Agent, the Swing Line Lender or any Bank to serve process in any other manner permitted by law or to commence legal proceedings or otherwise proceed against Borrower in any other jurisdiction.

This Agreement shall be binding upon and inure to the benefit of Borrower, the Agent, the Documentation Agent, the Swing Line Lender and the Banks and their respective successors and assigns, and all subsequent holders of the Notes except that the obligation of the Banks to make Revolving Credit Loans or Term Loans hereunder and the obligation of the Swing Line Lender to make any Swing Line Loan hereunder shall not inure to the benefit of any successors or assigns of Borrower.

This Agreement may be executed by the parties hereto individually or in any combination, in one or more counterparts, each of which shall be an original and all of which shall together constitute one and the same agreement.

if the transactions contemplated hereby would be usurious, under any controlling law, then, in that event, notwithstanding anything to the contrary in this Agreement, the Notes or any other instrument or agreement entered into in connection therewith, it is agreed as follows: (i) the aggregate of all charges which constitute interest under the laws of the controlling jurisdiction that are contracted for, chargeable or receivable under this Agreement or under any of the other aforesaid instruments or agreements or otherwise in connection with the Notes ("Interest") shall under no circumstances exceed the maximum amount of interest permitted by law (the "Maximum Amount"), and any Interest in excess of the Maximum Amount shall be cancelled automatically and shall not be payable under this Agreement, the Notes or the aforesaid instruments or agreements and, if theretofore paid, shall be either refunded to Borrower or credited ratably on the principal of the Notes; and (ii) in the event that the maturity of the Notes is accelerated by reason of an election of the Required Banks resulting from any Event of Default under this Agreement or otherwise, or in the event of any voluntary or mandatory prepayment by Borrower permitted or required by this Agreement, the Notes or any of the other aforesaid instruments or agreements, then Interest may never include more than the Maximum Amount, and excess Interest, if any, shall be cancelled automatically as of the date of such acceleration or prepayment, and if theretofore paid, shall be either refunded to Borrower or credited ratably on the principal of the Notes; provided, that, nothing contained in this Section 10.14 shall be deemed to imply that the laws of any State other than the State of New York shall govern this Agreement or the Notes.

of the foregoing two paragraphs from (y) the lesser of (i) the amount of Interest which would have accrued on such Notes if the Maximum Amount had at all times been in effect, and (ii) the amount of Interest which would have accrued if Interest on such Notes, not limited to the Maximum Amount, had at all times been in effect.

As used in this Agreement, "attorneys' fees" shall include, without limitation, all reasonable fees of counsel (including, without limitation, those incurred on appeals) actually incurred arising from such services and all reasonably incurred expenses, costs, charges and other fees of such counsel, and all such fees shall constitute Indebtedness of Borrower to the Agent, the Documentation Agent, the Swing Line Lender and the Banks under this Agreement. Without limiting the generality of the foregoing, such expenses, costs, charges and fees may include: paralegal fees, costs and expenses; accountants' fees, costs and expenses; court costs and expenses; photocopying and duplicating expenses; long distance telephone charges; air express and courier charges; telegram charges; secretarial overtime charges; and, expenses for travel, lodging and food paid or incurred in connection with the performance of such legal services.

Any provision of this Agreement prohibited by the laws of any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition, or modified to conform with such laws, without invalidating the remaining provisions of this Agreement, and any such prohibition in any jurisdiction shall not invalidate such provisions in any other jurisdiction.

The Agent, the Documentation Agent, the Swing Line Lender and each Bank are hereby authorized to deliver a copy of any financial statement or any other information relating to the business, operations or financial condition of Borrower which may be furnished to it hereunder or otherwise, to any regulatory body or agency having jurisdiction over the Agent, the Documentation Agent, the Swing Line Lender or such Bank or to any Person which shall, or shall have any right or obligation to, succeed to all or any part of the interest of the Agent, the Documentation Agent, the Swing Line Lender or

such Bank in, this Agreement, the other Loan Documents and any security herein or therein provided for or otherwise securing the Notes. Except as provided above, the Agent, the Documentation Agent, the Swing Line Lender and the Banks agree that from the date hereof, they will not, without the prior written consent of Borrower, submit or disclose to or file with any Person other than the Agent, the Documentation Agent, the Swing Line Lender or a Bank or any of its or such Bank's Affiliates or a Person that may become a Bank, or such Person's Affiliates, any confidential or non-public information relating to Borrower, except where disclosure may be required by law.

Upon receipt by Borrower of (i) an affidavit of an authorized officer of any Bank or the Swing Line Lender setting forth the fact of loss, theft or destruction of any Note and of its ownership of the Note at the time of such loss, theft or destruction or (ii) a mutilated Note, such affidavit or mutilated Note shall be accepted as satisfactory evidence thereof and no further indemnity shall be required as a condition to the execution and delivery of a new Note of like tenor in lieu of such lost, stolen, destroyed or mutilated Note without expense to the holder thereof, provided that such Bank, or the Swing Line Lender, as the case may be, agrees in writing to indemnify Borrower from all expenses, claims and liabilities (including without limitation, reasonable attorneys' fees actually incurred) in the defense of any such claims resulting from the loss, theft, destruction or mutilation of the old Note and the execution and delivery of the new Note.

ARTICLE 11. AGENCY

Borrower, the Banks and the Swing Line Lender agree with the Agent and the Documentation Agent as follows:

(a) Each Bank and the Swing Line Lender hereby irrevocably designates and appoints Fleet Bank, National Association as the Administrative Agent and Collateral Agent of such Bank and the Swing Line Lender under the Loan Documents (including any additional documents referred to therein as "Loan Documents"), and each such Bank and the Swing Line Lender hereby irrevocably authorizes the Agent to take such action on its behalf under the provisions hereof and thereof and to

exercise such powers and perform such duties as are expressly delegated to the Agent by the terms hereof and thereof together with such other powers as are reasonably incidental thereto. The Agent shall hold the security pledged under the Borrower Security Agreement in accordance with the terms thereof. Notwithstanding any provision to the contrary in this Agreement or any of the other Loan Documents, the Agent shall not have any duties or responsibilities except those expressly set forth herein or therein, nor any fiduciary relationship with any Bank or the Swing Line Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into the Loan Documents or otherwise exist against the Agent.

(b) The Agent may execute any of its duties by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

(c) Neither the Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such person under or in connection with any of the Loan Documents (except for its or such person's own gross negligence or willful misconduct), or (ii) responsible in any manner to any Bank or the Swing Line Lender or Participant for any recitals, statements, representations or warranties made by Borrower contained herein or in any certificate, report, statement or other document referred to or provided for in, or received by the Agent under or in connection with any of the Loan Documents, or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of any of the Loan Documents or for any failure of Borrower to perform its obligations under any of the Loan Documents. The Agent shall not be under any obligation to any Bank to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of any of the Loan Documents, or to inspect the properties, books or records of Borrower.

(d) The Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation believed by it to be genuine

and correct and to have been signed, sent or made by the proper person or persons and upon advice and statements of legal counsel (including, without limitation, counsel to Borrower), independent accountants and other experts selected by the Agent. The Agent may deem and treat the payee of any Note as the owner thereof for all purposes unless a written notice of assignment, negotiation or transfer thereof shall have been filed with the Agent.

(e) The Agent shall be fully justified in failing or refusing to take any action under any of the Loan Documents unless it shall first receive such advice or concurrence of the Banks as it deems appropriate or as required by the specific terms of this Agreement or it shall first be indemnified to its satisfaction by the Banks against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. The Agent shall in all cases be fully protected in acting, or in refraining from acting, under any of the Loan Documents in accordance with a request of the Required Banks (or all Banks if specifically required by the terms of this Agreement), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Banks, the Swing Line Lender and all future holders of the Notes and all Participants.

(g) Until such time as the Agent shall have been notified in writing duly executed on behalf of any Bank by an officer thereof duly authorized to take such action, that such Bank has sold all or a portion of the Revolving Credit Loans or the Term Loans made by, or Revolving Credit Commitment or Term Loan Commitment of, such Bank, the Agent may treat such Bank as the owner or holder of such Bank's share of the Revolving Credit Loans or Aggregate Revolving Credit Commitment, or of such Bank's Term Loan or Term Loan Commitment, as applicable, in accordance with the percentages thereof advanced by such Bank. The foregoing shall also apply to the Swing Line Lender with respect to the Swing Line Loans and the Swing Line Commitment.

(h) The Bank of New York shall act as the Documentation Agent under this Agreement and the provisions of Sections 11.3 and 11.4 shall also apply to the Documentation Agent with respect thereto. The Documentation Agent shall have no responsibility, duties or obligations under this Agreement or any other Loan Document. Furthermore, at any time or times, in order to comply with any legal requirement in any jurisdiction, the Agent may appoint another bank or trust company or one or more other Persons, either to act as co-agent or co-agents, jointly with the Agent, or to act as separate agent or agents on behalf of the Banks with such power and authority as may be necessary for the effectual operation of the provisions hereof and may be specified in the instrument of appointment (which may, in the discretion of the Agent, include provisions for the protection of such co-agent or separate agent similar to the provisions of this Article XI).

(i) It is understood by all of the parties to this Agreement that the Agent is acting simultaneously in its capacity as Agent for the Banks and the CP Holders under this Agreement and the Borrower Security Agreement and as Agent for the SBA under the SBA Security Agreement; and accordingly the Agent shall not be liable to any Bank, the Swing Line Lender, any CP Holder, any Paying Agent, the Borrower or the SBA (or their successors and assigns) in connection with or any way directly or indirectly related to its acting in such dual capacity (except for the Agent's own gross negligence or willfull misconduct) and each of the Banks hereby consents thereto. All references to the Agent herein shall be construed in accordance with the foregoing so long as the SBA Security Agreement shall remain in full force and effect and as long as the Borrower Security Agreement secures any CP Debt. Furthermore, each Bank expressly (i) consents to the Agent's,

Each Bank and the Swing Line Lender expressly acknowledges that neither the Agent nor the Documentation Agent nor any of their respective officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any representations or warranties to it and that no act by the Agent or the Documentation Agent hereinafter taken, including any review of the affairs of Borrower shall be deemed to constitute any representation or warranty by the Agent or the Documentation Agent to any Bank or the Swing Line Lender. Each Bank and the Swing Line Lender represents to the Agent that it has, independently and without reliance upon the Agent or the Documentation Agent, or the Swing Line Lender, or the other Banks, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of Borrower and made its own decision to enter into this Agreement. Each Bank and the Swing Line Lender also represents that it will, independently and without reliance upon the Agent, the Documentation Agent, the Swing Line Lender, or the other Banks, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action hereunder, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of Borrower. Except for notices, reports and other documents expressly required to be furnished to the Banks and/or the Swing Line Lender by the Agent hereunder, neither the Agent nor the Documentation Agent shall have any duty or responsibility to provide any Bank or the Swing Line Lender with any credit or other information concerning the business, operations, property, financial and other condition or creditworthiness of Borrower which may come into the possession of the Agent or any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates,

provided that the Agent shall supply the Banks and the Swing Line Lender with a copy of any financial audit of Borrower actually received by the Agent.

Each Bank jointly and severally agrees to indemnify Fleet in its capacity as Agent (to the extent not reimbursed by Borrower), ratably according to its Percentage of the Aggregate Revolving Credit Commitment from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time (including without limitation at any time following the payment of any of the Notes) be imposed on, incurred by or asserted against the Agent in any way relating to or arising out of this Agreement, the other Loan Documents or the transactions contemplated hereby or thereby or any action taken or omitted by the Agent under or in connection with any of the foregoing; provided that no Bank shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from the Agent's bad faith, willful misconduct or gross negligence. The agreements in this subsection shall survive the payment of the Notes and the related obligations and the termination of the Revolving Credit Commitment, the Swing Line Commitment and the Term Loan Commitment.

selected by Borrower shall require the prior written consent of the Required Banks, which consent shall not be unreasonably withheld. Any successor agent must be a bank or trust company incorporated and doing business within the United States of America having a combined capital and surplus of at least $250,000,000. After any retiring Agent's resignation hereunder as Agent, the provisions of this Article XI shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement. In the event that the Agent becomes subject to the receivership of the Federal Deposit Insurance Corporation or any successor entity, such receiver commences the liquidation of the Agent, and Banks holding at least 10% of the sum of the Aggregate Revolving Credit Commitment plus the amount of all Term Loans then outstanding request the Agent to resign because of such receivership, the Agent's agency under this Agreement shall terminate.

ARTICLE 12. SALES AND TRANSFERS

(b) Any Assignment pursuant to this Section 12.1 shall (i) be in an aggregate principal amount of not less than $5,000,000; (ii) be of a constant, and not a varying percentage of the Assignor's rights and obligations under the Loan Documents; (iii) require the prior written consent of Borrower, which consent shall not be unreasonably withheld (it being the understanding of the parties hereto that a refusal to consent to an Assignment to an entity which is a significant competitor

of Borrower shall not be considered unreasonable); provided, that, such consent shall not be required if a Default shall have occurred and then be continuing, or such Assignee is a subsidiary or affiliate of such Assignor, or such Assignee is a subsidiary or affiliate of another Bank, or such Assignee is another Bank; (iv) require the prior written consent of the Agent and the Swing Line Lender, which consent shall not be unreasonably withheld; provided, that, such consent shall not be required if such Assignee is another Bank; (v) be subject to the requirement that after giving effect to such Assignment, the Revolving Credit Commitment and Term Loan Commitment of such Assignor remaining is not less than $5,000,000 and (vi) be subject to the delivery to the Agent of an Assignment signed by the Assignor and the Assignee, along with an assignment fee in the sum of $3,500 for the account of the Agent.

(c) Upon execution, delivery and acceptance of each Assignment and the satisfaction of the conditions set forth in subclauses (a) and (b) above, from and after the effective date specified therein, which effective date shall be at least five Business Days after the execution thereof, Borrower, the Agent, and the Banks agree that, to the extent of any such Assignment,

(i) the Assignee shall, in addition to any rights, benefits and obligations hereunder held by it immediately prior to such effective date, have the rights, benefits and obligations of a Bank under this Agreement, the Assignor's Revolving Credit and/or Term Loan Commitment, the Revolving Credit Loans, the Term Loans and the Notes as it would have if it were a Bank hereunder to the extent that the same have been assigned and delegated to it pursuant to such Assignment, and

(ii) the Assignor shall, to the extent that rights, benefits and obligations hereunder have been assigned and delegated by it pursuant to such Assignment, relinquish its rights and benefits and be released from its obligations under this Agreement (and, in the case of an Assignment covering all or the remaining portion of the Assignor's rights, benefits and obligations under this Agreement, the Assignor shall cease to be a Bank hereunder), except that in all cases the Assignor shall remain entitled to the rights and benefits arising under Section 10.6, and shall remain liable with respect to any of its obligations arising under Article XI, with respect to any matters arising prior to the effective date of any such Assignment;

provided, that the Agent, Borrower and each Bank shall be entitled to continue to deal solely and directly with the assigning Bank in connection with the interests so assigned and delegated to the Assignee until written notice of such Assignment, together with addresses and related information with respect to the Assignee, shall have been given to the Agent, Borrower and each Bank by the assigning Bank and the Assignee.

(c) Upon its receipt of an Assignment executed by the Assignor and an Assignee, together with the Note(s) subject to such Assignment, the Agent shall, if such Assignment has been completed and conforms to the requirements of this Section 12.1, forward a photostatic copy thereof to Borrower. Within 5 Business Days after its receipt of a photostatic copy of such Assignment, Borrower shall execute and deliver to the Agent, to be exchanged for the applicable Note(s) delivered to the Agent by the Assignor, a new Note or new Notes payable to the order of the Assignee in an amount equal to and of the same type as the Note or Notes assumed by it pursuant to such Assignment and, if the Assignor has retained a Revolving Credit Commitment or a portion of the Term Loan hereunder, a new Revolving Credit Note or Term Note, as the case may be, payable to the order of the Assignor in an amount equal to the Revolving Credit Commitment or the amount of the Term Loan retained by it hereunder. Such new Note or Notes shall be of the same type as, and in aggregate principal amount equal to the aggregate principal amount of, such Note or Notes shall be dated the effective date of such Assignment, shall be payable to the order of the Assignee and, if applicable, the Assignor, shall otherwise be in substantially the form of such surrendered Note(s), and shall constitute Revolving Credit Note(s) or a Term Note under this Agreement, as the case may be. Such new Revolving Credit Note(s) or Term Note shall be in replacement and substitution for, and not in payment of, the Revolving Credit Note(s) or Term Note delivered to the Agent by the Assignor. The Agent shall deliver such new Revolving Credit Note(s) or Term Note to the payee or payees thereof and shall mark the Revolving Credit Note(s) or Term Note previously held by the Assignor as "replaced" and shall deliver the same to Borrower.

Assignee and such Assignee's name and address and (ii) the Percentage or amount of the Term Loan, if any, retained by the Assignor, and the appropriate officer of each of Borrower and the Agent shall initial each such revision.

(e) The foregoing provisions shall be equally applicable to the Swing Line Lender, Swing Line Note and Swing Line Commitment with such changes necessary to conform the foregoing to the Swing Line Lender, Swing Line Note and Swing Line Commitment.

(f) In addition to the participations provided for in this Agreement, including those set forth in Section 2.1(c) and Section 10.9, each Bank may grant participations in all or any part of its rights under the Loan Documents to one or more party that would be eligible to be an Assignee, provided that (i) such Bank's obligations under this Agreement and the other Loan Documents shall remain unchanged, (ii) such Bank shall remain solely responsible to the other parties to this Agreement and the other Loan Documents for the performance of such obligations, (iii) the Borrower, the Agent, the Swing Line Bank, the Documentation Agent and the other Banks shall continue to deal solely and directly with such Bank in connection with such Bank's rights and obligations under this Agreement and the other Loan Documents, (iv) no sub-participations shall be permitted without the consent of the Borrower and the Agent (which consent shall not be unreasonably withheld), (v) neither the granting nor the offering of such participation would require that any additional loss, cost or expense be borne by the Borrower at any time or would require any registration or qualification under any applicable federal or state securities laws, and (vi) the voting rights of any holder of any participation shall be limited to the those matters requiring the consent of all Banks as set forth under Section 10.2.

(g) No Bank shall, as between and among the Borrower, the Agent, the Swing Line Lender and such Bank, as the case may be, be relieved of any of its obligations under the Loan Documents as a result of any Assignment or the granting of any participation in all or any part of its rights under the Loan Documents.

(h) Subject to Section 12.1(g), any Bank may at any time or from time to time assign all or any portion of its rights under the Loan Documents to a Federal Reserve Bank, provided that any such assignment shall not release such assignor from its obligations thereunder.

(i) the Agent, the Documentation Agent, the Swing Line Lender and the Banks have made no representation or warranty and shall have no responsibility with respect to any statements, warranties or representations made in or in

connection with this Agreement or the other Loan Documents or the execution, legality, validity, enforceability, genuineness, sufficiency, collectibility or value of this Agreement, the other Loan Documents, and Collateral, or any other Instrument or document furnished pursuant hereto;

(ii) the Agent, the Documentation Agent, the Swing Line Lender and the Banks have made no representation or warranty and shall have no responsibility with respect to the financial condition of Borrower and its Subsidiaries or any other Person primarily or secondarily liable in respect of any of their obligations under this Agreement or any of the other Loan Documents, or the performance or observance by Borrower and its Subsidiaries or any other Person primarily or secondarily liable in respect of their obligations under this Agreement or any of the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto;

(iii) such New Bank confirms that it has received a copy of this Agreement and the other Loan Documents, together with copies of the most recent financial statements referred to in Sections 4.18 and 6.1 hereof and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Instrument of Adherence;

(iv) such New Bank will, independently and without reliance upon the other Banks, the Swing Line Lender, the Documentation Agent, or the Agent and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement;

(v) such New Bank appoints and authorizes the Agent and the Documentation Agent to take such action as Agent and Documentation Agent, respectively, on its behalf and to exercise such powers under this Agreement and the other Loan Documents as are delegated to the Agent and the Documentation Agent by the terms hereof or thereof, together with such powers as are reasonably incidental thereto;

(vi) such New Bank agrees that it will perform in accordance with their terms all of the obligations that by the terms of this Agreement are required to be performed by it as a Bank; and

(vii) such New Bank represents and warrants that it is legally authorized to enter into such Instrument of Adherence.

Upon the effective date of any Instrument of Adherence, the New Bank shall make all (if any) such payments to the other Banks as may be necessary to result in the Revolving Credit Loans made by such New Bank being equal to such New Bank's Percentage (as then in effect) of the aggregate principal amount of all Revolving Credit Loans outstanding to Borrower as of such date. Borrower hereby agrees that any New Bank so paying any such amount to the other Banks pursuant to this Section 12.2 shall be entitled to all the rights of a Bank hereunder and such payments to the other Banks shall constitute Revolving Credit Loans held by such New Bank hereunder and that such New Bank may, to the fullest extent permitted by law, exercise all of its right of payment (including the right of set- off) with respect to such amounts as fully as if such New Bank had initially advanced Borrower the amount of such payments.

THIS AGREEMENT CONTAINS A WAIVER OF TRIAL BY JURY.
SEE SECTION 10.7 HEREOF.

[BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, Borrower, the Agent, the Documentation Agent, the Swing Line Lender and the Banks have caused this Agreement to be duly executed by their respective officers hereunto duly authorized as of the day and year first above written.

MEDALLION FUNDING CORP.

By: /s/ Alvin Murstein
    --------------------------
Name:  Alvin Murstein
Title: Chief Executive Officer



By: /s/ Daniel F. Baker
    --------------------------
Name:  Daniel F. Baker
Title: Treasurer and Chief
        Financial Officer

FLEET BANK, NATIONAL ASSOCIATION, as Agent, as
Swing Line Lender and as one of the Banks

By: /s/ Andrea H. Lee
    --------------------------
  Title: Vice President
  Payment Office:
       1185 Avenue of the Americas
       New York, New York 10036

THE BANK OF NEW YORK,
as Documentation Agent
and as one of the Banks

By: /s/ Scott Silverstein
    --------------------------
 Title: Vice President

BANKBOSTON, N.A.

By: /s/ Jack Bender
    --------------------------
 Title: Director

HARRIS TRUST AND SAVINGS BANK

By: /s/ Michael Houlihan
    --------------------------
 Title: Vice President

BANK TOKYO - MITSUBISHI TRUST COMPANY

By: /s/ James Brown
    --------------------------
 Title: Vice President

ISRAEL DISCOUNT BANK OF NEW YORK

By: /s/ Jerry Grossman
    --------------------------
 Title: Senior Vice President


By: /s/ Maureen McKee
    --------------------------
 Title: Vice President

EUROPEAN AMERICAN BANK

By: /s/ Dennis Nochowitz
    --------------------------
 Title: Vice President

BANK LEUMI TRUST COMPANY OF NEW YORK

By: /s/ Paul Tine
    --------------------------
 Title: Vice President

By: /s/ Rich Silverstein
    --------------------------
 Title: Senior Vice President

THE CHASE MANHATTAN BANK

By: /s/ William Saya
    --------------------------
 Title: Vice President

                               December 24, 1997

                              Revolving Credit
Name and Address of Bank      Facility Available       Percentage

Fleet Bank, N.A.
1185 Avenue of the Americas
New York, New York 10036          $30,000,000            30/195

The Bank of New York
530 Fifth Avenue
New York, NY 10036                $30,000,000            30/195

BankBoston, N.A.
100 Federal Street
Boston, Massachusetts 02110       $30,000,000            30/195

Harris Trust and
  Savings Bank
111 West Monroe
Chicago, IL 60690                 $20,000,000            20/195

Bank Tokyo - Mitsubishi
  Trust Company
1251 Avenue of the Americas
New York, New York 10016          $20,000,000            20/195

The Chase Manhattan Bank
600 Fifth Avenue
New York, NY 10020                $20,000,000            20/195

Israel Discount Bank
of New York
511 Fifth Avenue
New York, New York 10022          $15,000,000            15/195

European American Bank
335 Madison Avenue
New York, New York 10017          $15,000,000            15/195

Bank Leumi USA
562 Fifth Avenue
New York, NY 10036                $15,000,000            15/195

                                     - 2 -

TOTAL FACILITIES                 $195,000,000
                                 ============

EXHIBIT B

REVOLVING CREDIT NOTE

$_________ No. __ December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of ____________ (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) ____________ DOLLARS ($__________) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By:_____________________
Alvin Murstein
CEO

By:_____________________
Daniel F. Baker
Treasurer & CFO

EXHIBIT C

$_______________ No._________

December __, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "borrower"), hereby unconditionally promises to pay on , or on such earlier date as may be required under the Loan Agreement (hereinafter referred to), to the order of ____________________ (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) _____________________ MILLION DOLLARS ($________________) and (b) the aggregate unpaid principal amount of the Term Loan made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, among the Borrower, the banks that from time to time are signatories thereto, Fleet Bank, National Association as Agent, Fleet Bank, National Association as swing line lender and The Bnak of New York as Documentaion Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

Amounts repaid on this Term Note cannot be reborrowed.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and (b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 4% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Term Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Term Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS TERM LOAN NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON- EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS TERM NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Term Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP
a New York corporation

By:______________________________
Name:
Title:

By:______________________________ Name:

Title:

EXHIBIT D

EXHIBIT E

_________, 199

Fleet Bank, N.A., as Agent for
the Banks referred to below
1185 Avenue of the Americas
New York, New York 10036
Attention: _______________

Dear Sir or Madam:

Reference is made to the Loan Agreement (capitalized terms used but not defined herein having the meaning ascribed thereto in the Loan Agreement).

[In the case all or a portion of a Revolving Credit borrowing is made as a Prime Rate Loan.]

Please advance $___________ as a Prime Rate Loan effective on ____________, 19__ . [Note: loan request must be received by no later than 1:00
p.m.,. New York City time, on the Business Day prior to this day in order for the loan to be advanced on the day requested.]

[In the case all or a portion of a Revolving Credit borrowing is made as a LIBO Rate Loan.]

Please advance $________________ as a LIBO Rate Loan effective on _______________, l9__ (which is not less than three Banking Days from the date hereof). The interest Period for such LIBO Rate Loan will commence on and include the date of advance and will end, subject to the limitations applicable to Interest Periods contained in the definition of Interest Period in the Loan Agreement, on the numerically corresponding date that is [one] [two] [three]
[four] [five] [six] months thereafter.

[In the case all or a portion of a borrowing is made as a Swing Line Loan.]

Please advance $___________ as a Swing Line Loan effective on ____________, 19__ . [Note: loan request must be received by no later than 1:00
p.m.,. New York City time in order for the loan to be advanced on the same day as the request.] The Swing Line Interest Period for such Swing Line Loan will commence on and include the date of advance and will end on the numerically corresponding date that is [one] [two] [three] [four] or [five] days thereafter.

[In the case of the conversion of all [or a portion] of a Prime Rate Loan into a LIBO Rate Loan.]

Please convert $_____________, which amount represents the entire outstanding principal amount] of the Prime Rate Loan or Loans of the undersigned, into a LIB0 Rate Loan effective on ____________19___ (which is not less than three Banking Days from the date hereof). The Interest Period for such LIBO Rate Loan will commence on and include the date of such conversion and will end, subject to the limitations applicable to Interest Periods contained in the definition of Interest Period in the Loan Agreement, on the numerically corresponding date that is [one] [two] [three] [four] [five] [six] months thereafter. [Note: Term Loans that are LIBO Rate Loans may only have an Interest Period of one month.]

[Please continue $_______________ (the balance) of such Prime Rate Loan or Loans not so converted as a Prime Rate Loan.]

[In the case of the conversion of all [or a portion] of a LIBO

Rate Loan into a Prime Rate Loan.]

Please convert $____________, [which amount represents the entire outstanding principal amount] of the LIBO Rate Loan or Loans of the undersigned, the Interest Period with respect to which ends on ____________ (the "Conversion Date"), into a Prime Rate Loan effective on the Conversion Date (which is not less than three Banking Days from the date hereof).

[In the case of the continuation of all [or a portion] of a LIBO Rate Loan.]

Please continue $_____________, [which amount represents the entire outstanding principal amount] of the LIBO Rate Loan or Loans of the undersigned, the Interest Period with respect to which ends on _______________ (which is not less than three Banking Days from the date hereof), as a LIBO Rate Loan with an Interest Period commencing on and including such date and ending, subject to the limitations applicable to Interest Periods contained in the definition of Interest Period in the Loan Agreement, on the numerically corresponding date that is [one] [two] [three] [four] [five] [six] months thereafter. [Note: Term Loans that are LIBO Rate Loans may only have an Interest Period of one month].

The Borrower hereby represents and warrants to the Bank that:

(a) Each and every of the representations and warranties set forth in the Loan Agreement is true as of the date hereof and with the same effect as though made on the date hereof, and is hereby incorporated herein in full by reference as if fully restated herein in its entirety.

(b) No Default or Event of Default and no event or condition which, with the giving of notice or lapse of time or both, would constitute such a Default or Event of Default, now exists or would exist under the Loan Agreement.

EXHIBIT F

SECURITY AGREEMENT

among

MEDALLION FUNDING CORP., as debtor,

UNITED STATES SMALL BUSINESS ADMINISTRATION

and

FLEET BANK, N.A., as Agent

SECURITY AGREEMENT

RECITALS

WHEREAS, the Borrower wishes to secure its obligations to the SBA under the TCC Note and the Edwards Notes (but not with respect to the Borrower's obligations

under other notes to the SBA), and the Bank Agent and the Banks have consented to share certain collateral with the SBA on the terms herein;

NOW, THEREFORE, in consideration of the willingness of the Agent and the SBA to enter into this Agreement and the SBA's approval of the Merger, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby covenant and agree as follows:

ARTICLE I
DEFINITIONS

SECTION 1.1. DEFINED TERMS. Capitalized terms defined in the foregoing caption and recitals shall have the respective meanings ascribed thereto. In addition, as used herein, the following terms shall have the following meanings:

(a) all Commercial Loans;

(b) all property and rights, including, but not limited to, Underlying Collateral, which now or hereafter secure Commercial Loans;

(c) all Books and Records;

(d) all amounts deposited in any Collateral Account relating to Commercial Loans;

(e) all Contracts relating to Commercial Loans;

(f) all rights and remedies of Borrower with respect to, or in connection with, any contract, security interest, guaranty or other document, instrument or agreement relating to or affecting any Commercial Loans or any Underlying Collateral;

(g) all General Intangibles relating to Commercial Loans;

(h) all Instruments relating to Commercial Loans;

(i) all Chattel Paper relating to Commercial Loans;

(j) all Equipment securing any Commercial Loan;

(k) all Investment Property securing any Commercial Loans;

(l) all Accounts relating to any Commercial Loans;

(m) all property and rights repossessed, or otherwise acquired in connection with any Commercial Loans or the exercise by Borrower of any rights of a secured party under or with respect to any of the Commercial Loans or arising out of the sale or disposition of any Commercial Loans, any other Commercial Loan Collateral, or in connection with the sale of any repossessed property;

(n) all parts, accessions, accessories, goods, appurtenant or related to any of the foregoing, replacement parts, trade names, choses in action, now or hereafter affixed thereto, arising therefrom, used in connection therewith, or related to the use, possession or operation thereof; and

(o) to the extent not otherwise included, all Proceeds, products, substitutions and replacements of any and all of the foregoing.

"Laws" shall have the meaning set forth in Section 2.2 hereof.
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"Liens" shall mean any interest in property securing an obligation owed to
 -----

a Person, whether such interest is based on the common law, statute or contract, and including but not limited to the security interest arising from a mortgage, encumbrance, pledge, conditional sale or trust receipt or a lease, consignment or bailment for security purposes. The term "Lien" includes reservations, exceptions, encroachments,

easements, rights of way, covenants, conditions, restrictions, leases and other similar title exceptions and encumbrances, including but not limited to mechanics', materialmen's, warehousemen's, carriers' and other similar encumbrances, affecting property.

SECTION 1.3. RULES OF CONSTRUCTION. (a) Words of the masculine gender shall mean and include correlative words of the female and neuter genders, and words importing the singular number shall mean and include the plural number and vice versa.

(c) Any defined term that relates to a document shall include within its definition any amendments, modifications, renewals, restatements, extensions, supplements, or substitutions which may have been heretofore or may be hereafter executed in accordance with the terms thereof.

(d) References in this Agreement to particular sections of the UCC or to any other legislation shall be deemed to refer also to any successor sections thereto or other redesignations for codification purposes.

(e) Terms used in this Agreement that are not capitalized shall have the meanings provided by the UCC to the extent the same are used or defined therein.

ARTICLE II
CREATION OF SECURITY INTEREST

SECTION 2.1. GRANT OF SECURITY INTEREST TO AGENT. Borrower hereby grants to the Agent for the benefit of the SBA a continuing first priority lien on and security interest in the SBA Collateral to secure the Borrower's obligations to the SBA under and pursuant to the SBA Secured Debt and under this Agreement, and, in furtherance of such grant, Borrower hereby assigns for security all the SBA Collateral to the Agent for the benefit of the SBA to secure the Borrower's obligations under the SBA Secured Debt and this Agreement.

SECTION 2.3 AGREEMENT TO PLEDGE ADDITIONAL COLLATERAL. In the event that the Designated Commercial Loans at any time fail to meet the requirements of the first sentence of Section 2.2 and the Borrower does not have sufficient Commercial Loans to designate to meet such requirements, the Borrower shall grant a security interest to the Agent for the benefit of the SBA in all of its Commercial Loans and Medallion Loans, such security interest to be subordinate to the security interest held by the Bank Agent to secure the Bank Obligations. The terms of such security interest shall be reflected in an appropriate amendment to the Intercreditor Agreement and shall provide that no distributions of the proceeds of such collateral shall be made to the SBA and the SBA shall take no action in connection therewith, or in any way interfere in any action that the Banks and/or the Bank Agent are taking in connection therewith, until the Bank

Obligations have been paid in full and all commitments under the Loan Agreement have terminated.

SECTION 2.5. RECORDING, REGISTERING, FILING, ETC. At any time or times after (i) a Default or an Event of Default has occurred or (ii) any change in any existing Law or the proposal by any Governmental Authority of a new Law which, in the Agent's or the SBA's opinion, adversely affects the validity, security or perfection of the security interests and liens granted herein, Borrower will perform, or will cause to be performed, each of the following:

(a) Record, register and file such notices, certificates of title, financing statements, mortgage assignments, trust deeds and other documents or instruments as may, from time to time, be requested by the Agent to carry out fully the intent of this Agreement, with such administrations or governmental agencies as may be necessary or advisable in order to perfect, establish, confirm, and maintain the security interests and liens created hereunder, as legal, valid, and binding security interests and liens upon the SBA Collateral;

(b) Furnish to the Agent evidence of every such recording, registering and filing; and

(c) Execute and deliver or perform, or cause to be executed and delivered or performed, such further and other instruments or acts as the Agent reasonably determines are necessary or desirable to fully carry out the intent and purpose of this Agreement or to subject the SBA Collateral to the security interest and lien created hereunder, including, without limitation, defending the title of Borrower to the SBA Collateral by means of negotiation with and, if necessary, appropriate legal proceedings

against, each party claiming an interest therein contrary or adverse to Borrower's title to same.

SECTION 2.6. DELIVERY OF DOCUMENTS. Pursuant to the Bank Security Agreement, the Bank Agent is holding instruments evidencing all of the Commercial Loans constituting the SBA Collateral. The Borrower agrees to continue to deliver such instruments to the Agent as long as this Agreement is in effect in accordance with the provisions of the Bank Security Agreement. The Agent acknowledges all instruments with respect to the SBA Collateral held in its capacity as Bank Agent under the Bank Security Agreement are also held in its capacity as Agent hereunder.

SECTION 2.7. FURTHER ASSURANCES. (a) At any time or times after (i) a Default or an Event of Default has occurred or (ii) any change in any existing Law or the proposal by any Governmental Authority of a new Law which, in the Agent's or the SBA's opinion, adversely affects the validity, security or perfection of the security interests and liens granted herein, then, in addition to the acts specifically required to be performed by Borrower elsewhere under this Agreement, Borrower shall do all other things and sign and deliver all other documents and instruments reasonably requested by the Agent to perfect, protect, maintain and enforce the security interests and liens of the Agent in the SBA Collateral, and the first priority of such security interests and liens, and other rights granted hereunder. Such acts shall include but not be limited to the marking of Borrower's Books and Records, the Chattel Paper and Instruments to show the Agent's security interests and liens and the filing of financing, renewal and/or continuation statements under the UCC or other documents evidencing the Agent's liens under applicable law and the delivery of any SBA Collateral the physical possession of which is necessary or desirable in order for the Agent to perfect its liens. Upon the occurrence of any of the events specified in subclauses (i) and (ii) of this Section 2.7(a), Borrower authorizes the Agent to execute alone any financing, renewal and/or continuation statement or any other document or instrument which the Agent may require to perfect, protect, continue or enforce in accordance herewith any security interest, lien or other right hereunder and authorizes the Agent to sign Borrower's name on the same. Upon payment in full by Borrower of all the SBA Secured Debt in accordance with the terms thereof, the security interests and liens granted by Borrower hereunder shall terminate, except that if, at any time, all or part of the payment of the monetary payments made on any SBA Secured Debt theretofore made by Borrower or any other Person is rescinded or otherwise must be returned by the Agent or any Bank for any reason whatsoever (including, without limitation, the insolvency, bankruptcy or reorganization of Borrower or such other Person), the security interests and liens granted hereunder or under any other present or future agreement between Borrower and the Agent, and all rights of the Agent and all SBA Secured Debt shall be reinstated as to such SBA Secured Debt which was satisfied by the payment to be rescinded or returned, all as though such payment had not been made, and Borrower shall sign and deliver to

the Agent all documents and things necessary to perfect all terminated liens subject to the intervening liens, if any, granted by Borrower to any Person.

(b) A carbon, photographic, or other reproduction of this Agreement shall be sufficient as a UCC filing and may be filed in any appropriate office in lieu thereof.

(c) Upon the occurrence of any of the events specified in subclauses (i) and (ii) of Section 2.7(a), to the extent requested by the Agent, Borrower will use its best efforts to cause each mortgagee of any and all real estate under any lease included in any Underlying Collateral relating to any SBA Collateral and each landlord under any lease included in any such Underlying Collateral to execute and deliver to the Agent assignments, in form and substance satisfactory to the Agent, by which such mortgagee or landlord waives its rights, if any, to the SBA Collateral.

SECTION 2.8. INDEMNITY. Borrower will hold the Agent and the SBA harmless from and indemnify the SBA and the Agent or other designee of the Agent against all losses, damages, costs and expenses (including, without limitation, attorneys' fees, costs and expenses) incurred by it, whether prior to or from and after the date hereof, whether direct, indirect or consequential, as a result of or arising from or relating to any suit, investigation, action or proceeding by any Person (including, without limitation, the SBA), whether threatened or initiated, asserting a claim for any legal or equitable remedy against any Person under any statute or regulation, including without limitation, any Federal or state antitrust laws, or under any common law or equitable cause or otherwise, all to the extent arising from or in connection with this Agreement or the enforcement of the rights of the Agent hereunder, other than losses, damages, costs and expenses resulting from, but only to the extent resulting from, the willful misconduct or gross negligence of the Person seeking indemnification.

SECTION 2.9. BORROWER REMAINS LIABLE. Anything herein to the contrary notwithstanding, (i) Borrower shall remain liable under the contracts and agreements included in the SBA Collateral to the extent set forth therein to perform all of its duties and obligations thereunder to the same extent as if this Agreement had not been executed, (ii) the exercise by the Agent of any rights under this Agreement shall not release Borrower from any of its duties or obligations under the contracts and agreements included in the SBA Collateral, and (iii) neither the Agent nor the SBA shall have any obligation or liability under the contracts and agreements included in the SBA Collateral by reason of this Agreement nor shall the Agent or the SBA be obligated to perform any of the obligations or duties of Borrower thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.

SECTION 2.10. AGENT MAY PERFORM. If Borrower fails to perform any agreement contained herein, the Agent may itself perform, or cause performance of, such agreement, and the expenses of the Agent incurred in connection therewith shall be

payable by Borrower, together with interest thereon at the rate specified as the Stated Interest Rate in the TCC Note, and until so paid shall be deemed part of the obligations secured hereby.

SECTION 2.11. AGENT'S DUTIES. The powers conferred on the Agent hereunder are solely to protect its interest and the interests of the SBA in the SBA Collateral and shall not impose any duty upon it to exercise any such powers except as provided herein. Except for the safe custody of any SBA Collateral in its possession and the accounting for monies actually received by it hereunder and performing its other express duties hereunder, the Agent shall have no duty as to any SBA Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any SBA Collateral.

ARTICLE III
PRIORITY OF SECURITY INTERESTS

SECTION 3.1. PRIORITY OF SECURITY INTERESTS. The Borrower warrants and represents to the Agent and the SBA that, as to those assets for which perfection may be accomplished by filing or by possession under the UCC, the security interests granted to the Agent hereunder constitute and will constitute at all times a valid and perfected first priority security interest vested in the Agent in and upon the SBA Collateral. Borrower further warrants and represents that the Agent's security interests in the SBA Collateral are not and hereinafter shall not become subordinate or junior to the security interests, liens or claims of any other Person, firm or corporation, including any state, county or local governmental agency, except for the Permitted Liens.

ARTICLE IV
SBA COLLATERAL

SECTION 4.1. REPRESENTATIONS, COVENANTS AND WARRANTIES. Borrower hereby makes the following representations, warranties and covenants to the Agent and the SBA, which shall survive the execution and delivery of this Agreement:

(a) Borrower is now and at all times hereafter shall be the absolute owner, free and clear of all Liens (other than Permitted Liens) of indefeasible title to all of the SBA Collateral, except for that portion of Borrower's rights and/or obligations under any Loan in which Borrower has granted a participation to any Person;

(b) To the best of Borrower's knowledge, each outstanding Loan included in the SBA Collateral does, and each future Loan included in the SBA Collateral will, represent a bona fide, valid and legally enforceable indebtedness according to its terms, and each such Loan, at the time of creation thereof, except with the consent of the Agent and the SBA, will be subject to no offsets, discounts, counterclaims, contra- accounts or

any other defense of any kind or character that materially adversely affects the value of such Loan;

(c) With respect to each outstanding and future Loan included in the SBA Collateral, the Agent and the SBA may rely on all statements or representations made by Borrower on or with respect to such Loans delivered hereunder, and, unless otherwise indicated in writing by Borrower, each outstanding Loan included in the SBA Collateral is, and each future Loan included in the SBA Collateral will be, genuine and in all respects what it purports to be, and, to Borrower's knowledge, there are no, and, at the time of creation of each such Loan there will not be any, to Borrower's knowledge, facts, events or occurrences that would in any way materially impair the validity or enforcement thereof;

(d) All of the outstanding Loans included in the SBA Collateral have been, and all future Loans included in the SBA Collateral will be, created, and are (or in the case of such future Loans, will be), and the form and content of each document related to all such outstanding and future Loans, the security related thereto, and the transactions from which it arose comply (or, in the case of such future Loans, will comply) in all material respects with any and all applicable laws, ordinances, rules and regulations, Federal, state and/or local, with respect to the extension of credit and charging of interest, including, without limitation, as applicable, the Federal Consumer Credit Protection Act, the Federal Fair Credit Reporting Act, the Federal Trade Commission Act, the Federal Equal Credit Opportunity Act and all Federal, state and local laws related to licensing, usury, truth in lending, real estate settlement procedures, consumer protection, equal credit opportunity, fair debt collection, unfair and deceptive trade practices, rescission rights and disclosures, and with all rules and regulations thereunder, all as amended, and any disclosures required with respect to any such Loan the failure of which to make would have a Material Adverse Effect on Borrower were and will continue to be made properly and in a timely manner;

(e) The original amount and unpaid balance of each Loan included in the SBA Collateral shown on Borrower's books and records and on any statement or schedule delivered to the Agent (i) are and will be the true and correct amount actually owing to Borrower;

(f) If requested by the SBA at any time or from time to time, Borrower shall cause a Lien search against each Person to whom a Loan included in the SBA Collateral has been made satisfactory to the Agent, to be performed and delivered directly to the Agent, which Lien search shall indicate the absence of any Liens against such Person or the property of the Person on which Borrower has a Lien, other than Liens in favor of Borrower which have been assigned to the Agent or the SBA and other than Permitted Liens;

(g) Borrower has not extended and will not extend any credit of any kind or in any manner to any Person in connection with the transactions from which the Loans included in the SBA Collateral arose or will arise other than as Borrower has indicated on and has had evidenced by, or will indicate or have evidenced by, in the case of future Loans included in the SBA Collateral, Borrower's files related to all such Loans;

(h) Each security agreement, UCC filing, title retention instrument, and other document and instrument, if any, which is security for the Loans included in the SBA Collateral contains, or will contain, in the case of future Loans included in the SBA Collateral, a correct and sufficient description of the Underlying Collateral covered thereby and each lien or security interest which secures any such outstanding Loan is, or any such future Loan will be, valid;

(i) To the best knowledge of Borrower, except as disclosed to the Agent, any and all policies of insurance related to the property securing any obligation of a Person to whom Borrower has made a Loan included in the SBA Collateral, or any guarantor of such Loan, in connection with any Loan included in the SBA Collateral and any credit life insurance, credit disability insurance, or credit unemployment insurance are in full force and effect in accordance with the terms of all agreements between Borrower and such Person or guarantor;

(j) Borrower has no knowledge of any fact which would impair in any material respect the value or validity of any Loan included in the SBA Collateral except as disclosed to the Agent; and

(k) The transactions contemplated herein, including the granting of security interests herein and the enforcement by the Agent of its rights hereunder if a Default or Event of Default occurs, do not and will not affect the validity of the pledges of the Underlying Collateral, and the Loans included in the SBA Collateral secured by the Underlying Collateral are and will still be valid against the Obligers of such Loans.

SECTION 4.2. COLLECTIONS.

(b) With respect to each of the Collections: Borrower shall collect all Collections, receive all payments thereon and immediately deposit the proceeds thereof into a Depository Account. Borrower may withdraw funds from such account to use in the ordinary course of its business.

SECTION 4.3. RIGHTS OF AGENT REGARDING COLLATERAL. Upon the occurrence and during the continuance of an Event of Default and subject to the provisions of the Intercreditor Agreement, the Agent shall have the right, and upon the direction of the SBA shall, at any time and from time to time thereafter, without notice to Borrower, (a) to notify, and upon the direction of the Agent to Borrower, the Borrower will notify, (i) all Persons to whom Borrower has made Loans that the Agent has a security interest in the SBA Collateral and direct all such Persons to make payments to the Agent or its designee, and to such banks and accounts (which may be the Collateral Account) as designated by the Agent or such designee, of all sums owing by them to Borrower, and (ii) all banks in which Borrower has any Depository Accounts of the occurrence of an Event of Default and direct all such Banks to transfer into the Collateral Account, or to such other account at such bank as shall be designated by the Agent or its designee, all amounts on deposit from time to time in the related Depository Accounts; (b) to settle, compromise, sell, assign, extend or renew any debt owing by any Persons to whom Borrower has made a Loan included in the SBA Collateral; (c) to sell or assign such SBA Collateral upon such terms as the Agent may deem advisable; and (d) to discharge and release in the name of Borrower and the Agent any such debt. Any and all disbursements for costs and expenses incurred or paid by the Agent with respect to the enforcement, collection or protection of its interest in the SBA Collateral, or against Borrower, whether by suit or otherwise, notification of Persons to whom Borrower has made such Loans, including reasonable attorneys' fees actually incurred, court costs and similar expenses, if any, shall be secured by the SBA Collateral, payable on demand.

ARTICLE V
DEFAULT

SECTION 5.1. EVENTS OF DEFAULT. Any one of the following events will constitute an "Event of Default":

(a) the failure to pay any amount due on the SBA Secured Debt, whether at maturity or upon acceleration in accordance with the terms thereof, and such failure shall continue for five (5) days after demand from the SBA delivered to the Borrower;

(b) the acceleration of the Bank Obligations after an event of default under the Loan Agreement or the Borrower's failure to pay at maturity the balance of the Bank Obligations and such failure constitutes an event of default under the Loan Agreement which has not been the subject of a waiver or forbearance in accordance with the terms of the Loan Agreement;

(c) the transfer of the Borrower by the SBA to its Office of Liquidation; or

(d) the failure of Borrower to observe, perform or comply with any of the terms, provisions, conditions, covenants, warranties or representations contained in this Agreement, which failure shall not have been remedied within 30 days after such failure shall first have become known to any officer of Borrower.

SECTION 5.2. REMEDIES.

(a) Upon the occurrence of any Event of Default, the Agent shall have, in addition to any other rights and remedies contained in this Agreement or as Bank Agent in the Bank Security Agreement, all the rights and remedies of a secured party under the UCC, and all other rights and remedies provided by law, all of which shall be cumulative to the extent permitted by law. Upon the occurrence of any Event of Default of which the Agent has been given notice by the Borrower or the SBA, and at any time thereafter if such or any other default shall then be continuing, the Agent shall have the right without further notice to Borrower, and upon direction of the SBA, subject to the provisions of the Intercreditor Agreement, (i) to take possession and control of, set off and apply to the payment of the SBA Secured Debt, any or all SBA Collateral, in the manner set forth in Section 5.3; (ii) to enforce payment in connection with the Commercial Loans or any other SBA Collateral; (iii) to notify the Borrower, and upon the direction of the Agent to Borrower, the Borrower will notify all Persons to whom Borrower has made Commercial Loans that the Agent has a security interest in such SBA Collateral and direct all such Persons to make payments to the Agent or its designee, and to such banks and accounts as designated by the Agent or such designee, of all sums owing by them to Borrower; to prosecute any action, suit or proceeding with respect to the SBA Collateral; (iv) to extend the time of payment of any and all SBA Collateral, to make allowances and adjustment with respect thereto, to issue credits in the name of Borrower or the Agent or to settle, compromise or renew any debt constituting a part of the SBA Collateral; and (v) to sell, assign and deliver the SBA Collateral (or any part thereof), at public or private sale, at broker's board, for cash, upon credit or otherwise, at the Agent's sole option and discretion and the Agent and the SBA may bid or become purchaser at any such sale, if public, free from any right of redemption, which is hereby expressly waived. Borrower agrees that the giving of ten days notice by the Agent, sent by certified mail, return receipt requested postage prepaid, to the address set forth below, designating the place and time of any public sale or of the time after which any private sale or other intended disposition of the SBA Collateral is to be made, shall be deemed to be reasonable notice thereof and Borrower waives any other notice with respect thereto. The net cash proceeds resulting from the exercise of any of the foregoing rights or remedies shall be applied by the Agent in accordance with
Section 5.3, and Borrower shall remain liable to the Agent and the SBA

for any deficiency, together with interest thereon at the rates provided in the documents evidencing the SBA Secured Debt, and the cost and expenses of collection of such deficiency, including (to the extent permitted by law), without limitation, reasonable attorneys' fees actually incurred, expenses and disbursements.

(b) If at any time or times hereafter the Agent employs counsel for advice with respect to this Agreement, or to intervene, file a petition, answer, motion or other pleading in any suit or proceeding relating to this Agreement (including, without limitation, the interpretation or administration, or the amendment, waiver or consent with respect to any term, of this Agreement), or relating to any SBA Collateral, or to protect, take possession of, or liquidate any SBA Collateral, or to attempt to enforce any security interest or lien in any SBA Collateral, or to represent the Agent in any pending or threatened litigation with respect to the affairs of Borrower or any claim of the SBA (whether against the Borrower, the Agent, the Bank Agent or any Bank) in any way relating to any of the SBA Collateral or to enforce any rights of the Agent or liabilities of Borrower or any Person to whom Borrower has made a Commercial Loan, then in any of such events, all of the reasonable attorneys' fees actually incurred arising from such services, and any expenses, costs and charges relating thereto, shall be secured by the SBA Collateral.

(c) Upon the occurrence of an Event of Default, the Agent shall have the right to require Borrower to assemble all SBA Collateral not already in the Agent's possession and make it reasonably available to the Agent at one or more places to be designated by the Agent which are reasonably convenient to both parties, and to take possession of such SBA Collateral and to enter and remain upon the various premises of Borrower without cost or charge to the Agent, and to use the same, together with materials, supplies, books and records of Borrower for the purpose of collecting such SBA Collateral or liquidating such SBA Collateral (plus any SBA Collateral already in the Agent's possession), whether by foreclosure, auction or otherwise. In addition, the Agent may remove from such premises such SBA Collateral, and any records with respect thereto, to the premises of the Agent or any custodian for such time as the Agent may desire, in order to effectively collect or liquidate such SBA Collateral.

(d) Upon the occurrence of an Event of Default, the Agent shall have the right to, and upon the direction of the SBA shall, require Borrower to establish and maintain a lockbox service with such bank or banks as may be acceptable to the Agent. In the event Borrower (or any of its Affiliates, subsidiaries, stockholders, directors, officers, employees or agents) shall receive any monies, checks, notes, drafts or any other items of payment relating to, or proceeds of, a Commercial Loan, Borrower agrees with the Agent as follows:

(i) Borrower shall hold all such items of payment in trust for the Agent and the SBA and as the property of Agent, the Banks and the SBA,

separate from the funds of Borrower, and Borrower shall immediately forward, or cause to be forwarded, the same to the lockbox service for application in accordance with Section 5.3.

(ii) Borrower shall forward to the Agent, on a daily basis, deposit slips related to all such items of payment received by Borrower and, if requested by the Agent, copies of such checks and other items, together with a statement showing the application of that portion of such items of payment relating to payment in connection with the Commercial Loans and a collection report with regard thereto in form and substance satisfactory to the Agent.

(iii) All such items of payment shall be the sole and exclusive property of the Agent as Bank Agent for the benefit of the Banks and as Agent for the SBA hereunder immediately upon the earlier of receipt of such items by the Agent or the receipt of such items by Borrower.

(iv) The lockbox service shall be subject to the sole control of the Agent and the Agent shall have the right at all times in its sole discretion to apply all or part of such items of payment in accordance with
Section 5.3. The Agent may, and upon the direction of the SBA, subject to the requirements of the Intercreditor Agreement, shall, release to Borrower all or any part of such items of payment.

(v) The Agent assumes no responsibility for such lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to deposits accepted by any bank thereunder.

(e) Upon the occurrence of any Event of Default, Borrower does hereby irrevocably make, constitute and appoint the Agent and any of its officers, employees or agents as the true and lawful attorneys of Borrower with power to:

(i) sign the name of Borrower on any financing statement, renewal financing statement, notice or other similar document that in the Agent's opinion must be filed in order to perfect or continue perfected the security interests granted in this Agreement;

(ii) receive, endorse, assign and deliver, in Borrower's name or in the name of the Agent, all checks, notes, drafts and other instruments relating to any SBA Collateral, including receiving, opening and properly disposing of all mail addressed to Borrower concerning the SBA Collateral and to notify postal authorities to change the address for delivery of mail to such address as the Agent may designate;

(iii) sign Borrower's name on any notices to any of Borrowers clients or customers; and

(iv) take or bring at Borrower's cost, in Borrower's name or in the name of the Agent, all steps, actions and suits deemed by the Agent necessary or desirable to effect collections in connection with any Commercial Loans, to enforce payment in connection with any Commercial Loans, to settle, compromise or release in whole or in part, any amounts owing in connection with any Commercial Loans, to prosecute any action or proceeding with respect to any Commercial Loans, to extend the time of payment in connection with any Commercial Loans, to make allowances and adjustments with respect thereto, to secure credit in the name of the Agent, and to do all other things necessary or desirable to realize upon the SBA Collateral, including but not limited to the Underlying SBA Collateral, and to carry out this Agreement.

Neither the Agent nor its agents or attorneys will be liable for any act or omission nor for any error of judgment or mistake of fact unless such act, omission, error or mistake shall occur as a result of their gross negligence or willful misconduct. This power, being coupled with an interest, is irrevocable so long as any of the SBA Secured Debt remains unpaid.

(f) Notwithstanding any provision herein, as long as the Intercreditor Agreement shall be in effect, the exercise by the Agent of rights hereunder shall be subject to the provisions of the Intercreditor Agreement.

(g) The rights and remedies provided herein with respect to the SBA or its Agent are not exclusive of any other rights or remedies provided by the SBA regulations and applicable law. Nothing contained in this Agreement shall be interpreted as restricting in any way the ability of the SBA to exercise the rights and remedies available to it under the Small Business Investment Act of 1958, as amended, and the regulations promulgated thereunder.

SECTION 5.3. APPLICATION OF PROCEEDS.

(a) The proceeds of any lockbox collection or sale of, or other realization upon, all or any part of the SBA Collateral shall be applied by the Agent in the following order of priority:

The Agent may make distributions hereunder in cash or in kind or in a combination of cash or property. Any deficiency remaining, after application of such cash or cash proceeds to the SBA Secured Debt and the Bank Obligations, shall continue to be obligations for which Borrower remains liable.

(b) In making the determinations and allocations required by this Section 5.3, the Agent may rely upon information supplied by the SBA as to the amount outstanding on the SBA Secured Debt and by the Banks and the Paying Agent as to the amounts outstanding on the Bank Obligations, and the Agent shall have no liability to the SBA or any of the Banks, the CP Holders or the Paying Agent for actions taken in reliance upon such information. All distributions made by the Agent pursuant to this Section 5.3 shall be final, and the Agent shall have no duty to inquire as to the application by the SBA, the Banks, the CP Holders or the Paying Agent of any amounts distributed to them. However, if at any time the Agent determines that an allocation was based upon a mistake of fact (including without limitation, mistakes based on an assumption that principal or interest or any other amount has been paid by payments that are subsequently recovered from the recipient thereof through the operation of any bankruptcy, reorganization, insolvency or other laws or otherwise), the Agent may in its discretion, but shall not, subject to Section 5.3(c), be obligated to, adjust subsequent allocations and distributions hereunder so that, on a cumulative basis, the SBA, the Banks and the CP Holders receive the distributions to which they would have been entitled if such mistake of fact had not been made.

(c) If, through the operation of any bankruptcy, reorganization, insolvency or other laws or otherwise, the security interests created hereby are enforced with respect to some, but not all, of the SBA Secured Debt and the Bank Obligations, the Agent shall nonetheless apply the proceeds for the benefit of the SBA, the Banks and the CP Holders, in the proportion and subject to the priorities of Section 5.3(a).

SECTION 5.4. WAIVER BY AGENT OR SBA. The Agent's or the SBA's failure at any time or times hereafter to require strict performance by Borrower of any of the provisions, warranties, terms and conditions contained in this Agreement shall not waive, affect or diminish any right of the Agent or the SBA at any time or times hereafter to demand strict performance therewith and with respect to any other provisions, warranties, terms and conditions contained in this Agreement, and any waiver of any Event of Default shall not waive or affect any other Event of Default, whether prior or subsequent thereto, and whether of the same or a different type. None of the warranties, conditions, provisions and terms contained in this Agreement shall be deemed to have been waived by any act or knowledge of the Agent or the SBA, or their respective agents, officers or employees except by an instrument in writing signed by an officer of the Agent or the SBA and directed to Borrower specifying such waiver.

ARTICLE VI
AGENCY

SECTION 6.1. APPOINTMENT AND ACTIONS.

(a) The SBA hereby designates and appoints Fleet Bank, N.A. as its collateral Agent hereunder, and the SBA hereby authorizes the Agent to take such action on its behalf under the provisions hereof and to exercise such powers and perform such duties as are expressly delegated to the Agent by the terms hereof together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary in this Agreement, the Agent shall not have any duties or responsibilities except those expressly set forth herein, nor any fiduciary relationship with the SBA, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against the Agent.

(b) The Agent may execute any of its duties by or through agents or attorneys- in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

(c) Neither the Agent nor any of its Affiliates or their respective officers, directors, employees, agents or attorneys-in-fact shall be (i) liable for any action lawfully taken or omitted to be taken by it or such person under or in connection with this Agreement (except for its or such person's own gross negligence or willful misconduct), or (ii) responsible in any manner to the SBA for any recitals, statements, representations or warranties made by Borrower contained herein or in any certificate, report, statement or other document referred to or provided for in, or received by the Agent under or in connection with this Agreement, or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of the Edwards Notes or the TCC Note or this Agreement or for any failure of Borrower to perform its obligations under either of them. The

Agent shall not be under any obligation to the SBA to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, the SBA Secured Debt or this Agreement, or to inspect the properties, books or records of Borrower.

(d) The Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper person or persons and upon advice and statements of legal counsel (including, without limitation, counsel to Borrower), independent accountants and other experts selected by the Agent. The Agent may deem and treat the SBA as the owner of the SBA Secured Debt for all purposes unless and until an assignment of the SBA's rights under this Agreement has been agreed to by the Agent in accordance with Section 7.9.

(e) The Agent shall be fully justified in failing or refusing to take any action under this Agreement unless it shall first receive such advice or concurrence of the SBA as it deems appropriate or as required by the specific terms of this Agreement or it shall first be indemnified to its satisfaction by the SBA against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. The Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement in accordance with a request of the SBA, and such request and any action taken or failure to act pursuant thereto shall be binding upon all future holders of the SBA Secured Debt.

(g) At any time or times, in order to comply with any legal requirement in any jurisdiction, the Agent may appoint another bank or trust company or one or more other Persons, either to act as co-agent or co-agents, jointly with the Agent, or to act as

separate agent or agents on behalf of the SBA with such power and authority as may be necessary for the effectual operation of the provisions hereof and may be specified in the instrument of appointment (which may, in the discretion of the Agent, include provisions for the protection of such co-agent or separate agent similar to the provisions of this Article VI).

SECTION 6.2. INDEPENDENT CREDIT DECISIONS. The SBA expressly acknowledges that neither the Agent nor any of its Affiliates or their respective officers, directors, employees, agents or attorneys-in-fact have made any representations or warranties to it and that no act by the Agent hereinafter taken, including any review of the affairs of Borrower shall be deemed to constitute any representation or warranty by the Agent to the SBA. The SBA represents to the Agent that it has, independently and without reliance upon the Agent, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and credit worthiness of Borrower and made its own decision to enter into this Agreement. The SBA also represents that it will, independently and without reliance upon the Agent, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action hereunder, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and credit worthiness of Borrower. Except for notices and other documents expressly required to be furnished to the SBA by the Agent hereunder, the Agent shall not have any duty or responsibility to provide the SBA with any credit or other information concerning the business, operations, property, financial and other condition or credit worthiness of Borrower which may come into the possession of the Agent or any of Affiliates or their respective officers, directors, employees, agents or attorneys-in-fact.

SECTION 6.3. INDEMNIFICATION OF AGENT. The SBA agrees to indemnify the Agent (to the extent not reimbursed by Borrower) from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time (including without limitation at any time following the payment of the SBA Secured Debt) be imposed on, incurred by or asserted against the Agent in any way relating to or arising out of this Agreement, the transactions contemplated hereby or any action taken or omitted by the Agent under or in connection with any of the foregoing; provided that the SBA shall not be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from the Agent's bad faith, willful misconduct or gross negligence. The agreements in this subsection shall survive the payment of the SBA Secured Debts and other obligations under this Agreement.

SECTION 6.4. RESIGNATION AND SUCCESSION.

(a) The Agent may resign as Agent hereunder upon its resignation as Collateral Agent in accordance with the procedures set forth in the Intercreditor Agreement. The successor Collateral Agent appointed in accordance with the terms of the Intercreditor Agreement shall automatically, without further action hereunder, become the successor agent hereunder, whereupon such successor agent shall succeed to the rights, powers and duties of the Agent, and the term "Agent" shall mean such successor agent effective upon its appointment, and the former Agent's rights, powers and duties as Agent shall be terminated, without any other or further act or deed on the part of such former Agent or any of the parties to this Agreement.

(b) In the event that all of the Bank Obligations under the Loan Agreement shall be satisfied and the Bank Agent shall be discharged of its obligations under the Bank Security Agreement at a time when any amount on the SBA Secured Debt shall remain outstanding, the Bank Agent shall, upon notice to the SBA, resign and be discharged of its obligations under this Agreement, whereupon the SBA shall succeed to the rights, powers and duties of the Agent, and the term "Agent" shall mean the SBA, and the former Agent's rights, powers and duties as Agent shall be terminated, without any other or further act or deed on the part of such former Agent or any of the parties to this Agreement, provided, however, that if the Borrower has also granted or expects to grant a subordinate security interest in the SBA Collateral to another lender or representative agent for a Person or Persons extending credit to the Borrower, the SBA agrees, upon the written request of the Borrower, to cooperate with the Borrower and such lender or representative agent to enter into an intercreditor agreement or appointment of a common collateral agent on terms similar to the terms of this Agreement or as otherwise reasonably agreed between the Borrower and the SBA.

(c) After any retiring Agent's resignation hereunder as Agent, the provisions of this Article VI shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement.

ARTICLE VII
MISCELLANEOUS

SECTION 7.1. CONTINUING LIEN. There is included within the term "SBA Collateral," as used herein, all other property and all interests therein of any kind hereafter acquired by Borrower, meeting or falling within the description of the SBA Collateral set forth herein and also the proceeds and products thereof.

SECTION 7.2. WAIVERS BY BORROWER.

(a) Borrower irrevocably waives the right to direct the application of any and all payments which may be received by the Agent during the continuance of an Event of Default, and Borrower does hereby irrevocably agree that, during the continuance of an Event of Default, the Agent shall have the continuing exclusive right to apply and reapply any and all such payments received in such manner as the Agent may deem advisable, notwithstanding any entry upon any of its books and records.

(b) Borrower also waives any and all notices of demand, notice or protest that Borrower might be entitled to receive with respect to this Agreement by virtue of any applicable statute or law, and waives demand, protest, notice of protest, notice of default, release, compromise, settlement, extension or renewal of all commercial paper, accounts, contract rights, instruments, guaranties, and otherwise, at any time held by the Agent on which Borrower may in any way be liable, notice of nonpayment at maturity of any and all Commercial Loans, and notice of any action taken by the Agent unless expressly required by this Agreement.

SECTION 7.3. PARTIES. This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto.

SECTION 7.4. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE LAWS OF ANOTHER JURISDICTION ARE MANDATORILY APPLICABLE TO THE EXERCISE OF REMEDIES OR THE PERFECTION OF SECURITY INTERESTS UNDER THE UCC.

SECTION 7.5. WAIVER OF JURY TRIAL AND SETOFF. EACH OF BORROWER, THE SBA AND THE AGENT HEREBY WAIVES TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT, OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF, OR ANY OTHER CLAIM OR DISPUTE, HOWSOEVER ARISING, BETWEEN BORROWER AND THE AGENT; AND BORROWER HEREBY WAIVES THE RIGHT TO INTERPOSE ANY SETOFF, COUNTERCLAIM OR CROSS- CLAIM IN CONNECTION WITH ANY SUCH LITIGATION, IRRESPECTIVE OF THE NATURE OF SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS- CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION).

SECTION 7.6. JURISDICTION; SERVICE OF PROCESS. Borrower hereby irrevocably consents to the Jurisdiction of the Courts of the State of New York, County of New

York and of any Federal Court located in the Southern District of New York, and agrees that venue in each of such Courts is proper in connection with any action or proceeding arising out of or relating to this Agreement. Nothing herein shall affect the right of the SBA to serve process in any other manner permitted by law or to commence legal proceedings or otherwise proceed against Borrower in any other jurisdiction.

SECTION 7.7. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and warranties of Borrower and all terms, provisions, conditions and agreements to be performed by Borrower contained in this Agreement shall be true and correct, and satisfied, where applicable, at the time of the execution of this Agreement and shall survive the execution and delivery of this Agreement.

SECTION 7.8. SUCCESSOR AGENT. In the event a successor agent is appointed pursuant to the provisions of Section 6.4, such successor agent shall succeed to the rights, powers and duties of the Agent hereunder, and the former Agent's rights, powers and duties as Agent shall, subject to the provisions of Section 6.4(c), be terminated, without any other or further act or deed on the part of such former Agent or the SBA. Such former Agent agrees to take such actions as are reasonably necessary to effectuate the transfer of its rights, powers and duties to such successor agent.

SECTION 7.9. TERMINATION. This Agreement and the security interest in the SBA Collateral created hereby will terminate when all of the SBA Secured Debt has been irrevocably paid and finally discharged in full in accordance with its terms. Borrower may not assign this Agreement without the express written consent of the Agent and the SBA. The SBA may not assign this Agreement without the express written consent of the Agent, except for any assignment by operation of law.

SECTION 7.10. NOTICES. All notices, requests, consents, demands or other communications provided for herein shall be deemed to have been given (i) five Business Days after the date mailed if sent by registered or certified mail, postage prepaid, return receipt requested, or (ii) on the day of delivery if personally delivered or sent by overnight courier service, or (iii) on the day of transmission if sent by telecopier and confirmed, on the same day as such notice is sent, by telephonic notice or by one of the other two methods listed above, and shall be addressed, as the case may be, as follows: to the Agent at Fleet Bank, N.A., 1185 Avenue of the Americas, New York, NY 10036 (Attn: Andrea Lee), Telecopier No. (212) 819-6212, with a copy to Emmet, Marvin & Martin, 120 Broadway, New York, New York 10271 (Attention: Richard M. Skoller, Esq.), Telecopier No. (212) 212-238-3100, and to Borrower at Medallion Funding Corp., 205 East 42nd Street, New York, New York 10017 (Attention: Daniel Baker, Vice President, Finance), Telecopier No. (212) 983-0351, with a copy to Palmer & Dodge LLP, One Beacon Street, Boston, Massachusetts 02108 (Attention: John L. Whitlock, Esq.), Telecopier No. (617) 227-4420, and to the SBA at United States Small

Business Administration, 409 Third Street, S.W., Washington, D.C. 20416, Attn:
Fonda Stephens-Kelly, or to such other person or address as either party shall designate to the other from time to time in writing forwarded in like manner.

SECTION 7.11. SEVERABILITY. To the extent any provision of this Agreement is prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

SECTION 7.12 RIGHTS AND REMEDIES NOT WAIVED. No course of dealing between the Borrower and the Agent or the SBA, and no failure on the part of the Agent or the SBA to exercise any rights or remedies hereunder or under any SBA Secured Debt shall operate as a waiver of any rights or remedies of the Agent or the SBA, and no single or partial exercise of any rights or remedies hereunder shall operate as a waiver or preclude the exercise of any other rights or remedies hereunder.

SECTION 7.13. COUNTERPARTS. This Agreement may be executed by the parties hereto in counterparts, each of which shall be an original and both of which shall together constitute one and the same agreement.

SECTION 7.14. AMENDMENTS. This Agreement may not be amended except by a writing executed by all the parties hereto.

IN WITNESS WHEREOF, this Agreement has been executed as of the day and year first above written by the duly authorized officers of the parties hereto.

MEDALLION FUNDING CORP.

By:___________________________
Name: Alvin Murstein
Title: Chief Executive Officer

By:___________________________
Name: Daniel F. Baker
Title: Treasurer and Chief
Financial Officer

UNITED STATES SMALL BUSINESS
ADMINISTRATION

By:___________________________
Name:
Title:

FLEET BANK, N.A.,
as Agent

By:___________________________
Name:
Title:

Loan Number    Borrower    Outstanding Balance
-----------    --------    -------------------



                                   $________________

Total Outstanding Balance $________________

EXHIBIT G

INTERCREDITOR AGREEMENT

This Intercreditor Agreement is dated as of ________________, 1997, and entered into among Fleet Bank, N.A., as agent (in such capacity, the "Bank Agent") for the lenders, commercial paper holders and paying agent under the Bank Security Agreement referred to below, Fleet Bank, N.A., as agent (in such capacity, the "SBA Agent") for the Small Business Administration under the SBA Security Agreement referred to below, Fleet Bank, N.A. as collateral agent (in such capacity, together with its successors in such capacity, the "Collateral Agent") hereunder, and the Small Business Administration (the "SBA").

RECITALS

WHEREAS, Medallion Funding Corp. (the "Borrower"), as the borrower, the several lenders from time to time parties thereto (the "Lenders"), the Bank Agent and The Bank of New York as documentation agent have entered into an Amended and Restated Loan Agreement dated as of December 24, 1997 (said agreement, as it may hereafter be amended, supplemented or otherwise modified from time to time, being the "Bank Loan Agreement"); and

WHEREAS, the Borrower also issues commercial paper from time to time, and has secured its obligations to the Lenders and to the holders of its commercial paper and the paying agent for such holders (collectively with the Lenders, the "Revolving Lenders") under and pursuant to an Amended and Restated Security Agreement dated as of December 24, 1997, between the Borrower and the Bank Agent (said agreement, as it may hereafter be amended, supplemented or otherwise modified from time to time, being the "Bank Security Agreement"); and

WHEREAS, effective upon the merger of Edwards Capital Corp. and Transportation Capital Corp. with and into the Borrower the Borrower also will assume the obligations owing to the SBA secured pursuant to a Security Agreement dated as of even date herewith (said agreement, as it may hereafter be amended, supplemented or otherwise modified from time to time, being the "SBA Security Agreement");

WHEREAS, the parties wish to set forth their agreement as to the decisions relating to the exercise of remedies under the Bank Security Agreement and the SBA Security Agreement and certain limitations on the exercise of such remedies.

NOW, THEREFORE, the parties agree as follows:

SECTION 1. DEFINED TERMS. Capitalized terms defined in the foregoing caption and recitals shall have the respective meanings ascribed thereto. In addition, as used herein, the following terms shall have the following meanings:

SECTION 2. APPOINTMENT AS COLLATERAL AGENT. The Bank Agent, on behalf of the Revolving Lenders, and the SBA Agent on behalf of the SBA, hereby severally appoint, Fleet Bank, N.A. to serve as the Collateral Agent and representative of the Secured Parties, and each authorizes the Collateral Agent to act as agent for the Secured Parties for the purpose of enforcing the Secured Parties' rights under the Security Documents. The Collateral Agent hereby accepts such appointment and agrees to act as Collateral Agent hereunder.

SECTION 3. DECISIONS RELATING TO EXERCISE OF REMEDIES.

(a) The Collateral Agent agrees to make such demands, to give such notices and to take such other actions under this Agreement and the Security Documents as are expressly required under the terms hereof and thereof, and to take such action to enforce the Security Documents and to foreclose upon, collect and dispose of the Collateral or any portion thereof as may be expressly required under the terms of this Agreement and the Security Documents or as Collateral Agent may be directed in accordance herewith. The Collateral Agent shall not be required to take any action that is in its opinion contrary to law or to

the terms of this Agreement or the Security Documents, or that would in its opinion subject it or any of its officers, employees, agents or directors to liability, and the Collateral Agent shall not be required to take any action under this Agreement or the Security Documents unless and until the Collateral Agent shall be indemnified to its reasonable satisfaction by the Secured Parties requesting such action against any and all loss, cost, expense or liability in connection therewith.

(b) With respect to the Revolving Primary Collateral, after receipt by the Collateral Agent of a Notice of Acceleration relating to the Revolving Obligations, the Collateral Agent shall take direction from the Bank Agent (who may, in accordance with the Bank Security Agreement be directed by the Required Banks (as defined in the Bank Loan Agreement)).

(c) With respect to the SBA Collateral, after receipt by the Collateral Agent of a Notice of Acceleration relating to the SBA Obligations, the Collateral Agent shall take direction from the SBA Agent (who may, in accordance with the SBA Security Agreement be directed by the SBA). In the event that (i) the Collateral Agent has received a Notice of Acceleration relating to the Revolving Obligations and has completed the liquidation of the Revolving Primary Collateral, and (ii) after application of all of the proceeds of the Revolving Primary Collateral some of the Revolving Obligations remain unpaid, but (iii) the Collateral Agent has not received a Notice of Acceleration relating to the SBA Obligations, then the Collateral Agent, upon direction by the Bank Agent as set forth above, shall liquidate the SBA Collateral in accordance with the terms of the Bank Security Agreement, applying all proceeds thereof as set forth in
Section 5.3 thereof. Furthermore, in the event that the Collateral Agent has received a Notice of Acceleration relating to the Revolving Obligations, but has not completed the liquidation of the Revolving Primary Collateral, the Collateral Agent, with the prior consent of the SBA (which will not be unreasonably withheld), upon direction by the Bank Agent as set forth above, shall liquidate the SBA Collateral in the manner set forth in the previous sentence.

(d) Each party executing this Agreement agrees that the Collateral Agent may act as required herein (regardless of whether any individual party or any other Secured Party agrees, disagrees or abstains with respect to such request), that the Collateral Agent shall have no liability for acting in accordance with such request and that no party or Secured Party shall have any liability to any other party or Secured Party for any such request. The Collateral Agent shall give prompt notice to all parties hereto of actions taken by it hereunder; provided, however, that the Collateral Agent shall have no liability for its

failure to do so and the failure to give any such notice shall not impair the right of the Collateral Agent to take any such action or the validity or enforceability under this Agreement of the action so taken.

(e) Each party executing this Agreement, on behalf of the Secured Parties, agrees not to take any action whatsoever to enforce any term or provision of the Security Documents or to enforce any of its rights in respect of the Collateral, except through the Collateral Agent in accordance with this Agreement.

(f) It is understood by all parties hereto that the Collateral Agent is acting simultaneously in its capacity as SBA Agent for the SBA under the SBA Security Agreement and as Bank Agent for the Revolving Lenders under the Bank Security Agreement; and accordingly the Collateral Agent shall not be liable to any Revolving Lender, the Borrower or the SBA (or their successors and assigns) in connection with or in any way directly or indirectly related to its acting in such dual capacity.

SECTION 4. APPLICATION OF PROCEEDS OF COLLATERAL.

(a) When a Notice of Acceleration relating to the Revolving Obligations is in effect, all amounts received from the liquidation or collection of the Bank Primary Collateral shall be applied in the following order of priority:

First, to the extent not theretofore paid by or on behalf of the Borrower, all Collateral Agent Obligations in connection with the performance of its duties hereunder relating to the liquidation or collection of the Bank Primary Collateral; and

Second, to the Bank Agent for distribution under the Bank Security Agreement in accordance with its terms.

(b) When a Notice of Acceleration relating to the SBA Obligations is in effect, all amounts received from the liquidation or collection of the SBA Collateral shall be applied in the following order of priority:

First, to the extent not theretofore paid by or on behalf of the Borrower, all Collateral Agent Obligations in connection with the performance of its duties hereunder relating to the liquidation or collection of the SBA Collateral;

Second, to the SBA Agent for distribution under the SBA Security Agreement in accordance with its terms.

(c) When a Notice of Acceleration relating to the Revolving Obligations is in effect but no Notice of Acceleration relating to the SBA Obligations is in effect, if at such time all

of the Revolving Obligations have not been paid in full, all amounts received from the liquidation or collection of the SBA Collateral shall be applied in the following order of priority (provided, that, if at such time the Collateral Agent has not completed its liquidation of the Bank Primary Collateral it shall not liquidate any SBA Collateral without the prior consent of the SBA, which consent shall not be required if the Collateral Agent has at such time completed such liquidation of such Bank Primary Collateral):

First, to prepay the SBA Obligations in accordance with their terms, and

Second, after all of the SBA Obligations have been paid in full, to the extent not theretofore paid by or on behalf of the Borrower, all Collateral Agent Obligations; and

Third, to the Bank Agent for distribution in accordance with the terms of the Bank Security Agreement.

(d) Unless the Collateral Agent shall have received instructions from the Bank Agent, the SBA Agent or the SBA as to the times at which any amounts are to be distributed to such parties pursuant to this section, all distributions or transfers pursuant to this section shall be made at such times and as promptly as the Collateral Agent shall in its good faith discretion determine to be reasonable and practicable under the circumstances, given the amount available for distribution or transfer and the amounts reasonably expected to be available, and the cost of distributing funds to the Secured Parties entitled to receive the same. The Collateral Agent shall at all times have the right to request distribution instructions as contemplated by the preceding sentence.

(e) Pending the disbursement thereof pursuant to the terms of this Agreement, all Collateral proceeds shall be invested by the Collateral Agent in such Short Term Investments as it shall determine from time to time. All reasonable commissions and other reasonable costs and expenses incurred by the Collateral Agent in connection with the acquisition or disposition by it of Short Term Investments may be deducted by the Collateral Agent from the income received by the Collateral Agent with respect thereto.

SECTION 5. INFORMATION.

(a) Upon the request of the Collateral Agent, each party hereto agrees to promptly inform the Collateral Agent of the existence and amount of the Secured Obligations owing to such party. Upon request of the Collateral Agent, each party will inform the Collateral Agent of such payments on the Secured

Obligations as may be received from time to time by such party and such other Secured Parties for whom such party is acting as agent.

(b) If, notwithstanding the request of the Collateral Agent, any party shall fail or refuse reasonably promptly to certify as to the existence or amount of any Secured Obligation or such other information concerning the Secured Obligations as the Collateral Agent may reasonably request, the Collateral Agent shall be entitled to determine such existence or amount of such Secured Obligations by such method as the Collateral Agent may, in its sole discretion, determine in good faith, including by reliance upon a certificate of an officer of the Borrower. The Collateral Agent may rely conclusively, and shall be fully protected in so relying, on any determination made by it in good faith in accordance with the provisions of this section (or as otherwise directed by a court of competent jurisdiction after notice and hearing on the merits) and, in the absence of gross negligence or willful misconduct shall have no liability to the Borrower, any holder of any Secured Obligation or any other person as a result of such determination.

(c) If the Collateral Agent receives any Notice of Acceleration or certificate rescinding a Notice of Acceleration or any request by the Borrower for any consent, waiver or amendment with respect hereto or any Security Document, it shall give prompt notice thereof to each other party at the address for such party provided for in Section 8 hereof, but shall have no liability for its failure to do so.

(d) A Notice of Acceleration shall be deemed to have been given only when the Notice of Acceleration has actually been received by the Collateral Agent and to have been rescinded when the Collateral Agent has actually received from the creditor or creditor group which gave such Notice of Acceleration a notice withdrawing such Notice of Acceleration. A Notice of Acceleration shall be deemed to be outstanding at all times after such notice has been given until such time, if any, as such notice has been rescinded.

SECTION 6. INTERCREDITOR ARRANGEMENTS; SBA COLLATERAL DESCRIPTION.

(a) Each of the Collateral Agent and each of the other parties for itself or on behalf of the respective Secured Parties hereby agrees, and the Borrower hereby acknowledges, that notwithstanding the order of priority of any filing of any financing statement, the lien of the SBA Agent for the benefit of the SBA on the SBA Collateral shall be prior in right, including rights of distribution, to the lien of the Bank Agent for the benefit of the Revolving Lenders, and that unless and until the

Borrower shall grant security interests in any of the other Collateral in accordance with the terms of the SBA Security Agreement and the Bank Loan Agreement, the SBA Agent and the SBA have no lien on, or right to receive distributions of the proceeds of, any other Collateral other than the SBA Collateral.

(b) If any Secured Party acquires custody, control or possession of any Collateral or proceeds therefrom, other than by distribution from the Collateral Agent pursuant to the terms of this Agreement, and such Secured Party would not have been entitled to receive such proceeds pursuant to the provisions of
Section 3, such Secured Party shall promptly cause such Collateral, proceeds or payments to be delivered to or put in the custody, possession or control of the Collateral Agent for disposition or distribution in accordance with the provisions of Section 3. Until such time as the provisions of the immediately preceding sentence have been complied with, such Secured Party shall be deemed to be a custodian of all such Collateral, proceeds and payments in trust for the parties entitled thereto hereunder.

(c) Each party hereto shall execute and deliver such other documents and instruments, in form and substance reasonably satisfactory to the other parties, and shall take such other action, in each case as any other party may reasonably have requested (at the cost and expense of the Borrower which, by countersigning this Agreement, agrees to pay such reasonable costs and expenses), to effectuate and carry out the provisions of this Agreement, including by recording or filing in such places as the requesting party may deem desirable, this Agreement or such other documents or instruments.

(d) No Secured Party may require the Collateral Agent to take or refrain from taking any action hereunder or under any of the Security Documents or with respect to any of the Collateral except as and to the extent expressly set forth in this Agreement.

SECTION 7. DISCLAIMERS AND INDEMNITY.

(a) The Collateral Agent (which term for purposes of this Section 7, shall, unless the context clearly indicates otherwise, also include the Bank Agent and the SBA Agent), shall have no duties or responsibilities to the Secured Parties except those expressly set forth in this Agreement and the Security Documents, and the Collateral Agent shall not by reason of this Agreement or the Security Documents be a trustee for any Secured Party or have any other fiduciary obligation to any Secured Party (including any obligation under the Trust Indenture Act of 1939, as amended). The Collateral Agent shall not be responsible to any Secured Party for any recitals, statements, representations or warranties contained in this Agreement, the Security Documents or any of the other documents relating to the Secured Obligations (collectively, the "Financing Agreements") or in any certificate or other document referred to or provided for in, or received by any of them under, any of the Financing Agreements, or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of any of the Financing Agreements or any other document referred to or provided for therein or any lien under the Security Documents or the perfection or priority of any such lien or the value or condition of the Collateral or the title of the Borrower to the Collateral or for any failure by the Borrower to perform any of its obligations under any of the Financing Agreements. The Collateral Agent may employ agents and attorneys- in-fact and shall not be responsible for the negligence or misconduct of any such agents or attorneys-in-fact selected by it with reasonable care. Neither the Collateral Agent nor any of its directors, officers, employees or agents shall be liable or responsible for any action taken or omitted to be taken by it or them hereunder or in connection herewith, except for its or their own gross negligence or willful misconduct.

(b) The Collateral Agent shall be entitled to rely upon any certification, notice or other communication (including any thereof by telex, telecopy, telegram or cable) believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper person or persons, and upon advice and statements of legal counsel (including counsel to the Borrower), independent accountants and other experts selected by the Collateral Agent. The Collateral Agent shall not be deemed to have actual, constructive, direct or indirect notice or knowledge of the occurrence of any Acceleration unless and until the Collateral Agent shall have received a Notice of Acceleration. The Collateral Agent shall have no obligation whatsoever either prior to or after receiving a Notice of Acceleration to inquire whether an Acceleration has, in fact, occurred and shall be entitled to rely conclusively, and shall be fully protected in so relying, on any Notice of Acceleration certificate so furnished to

it. As to any matters not expressly provided for by this Agreement, the Collateral Agent shall in all cases be fully protected in acting, or in refraining from acting, hereunder in accordance with instructions given in accordance with the Bank Security Agreement and/or the SBA Security Agreement.

(c) The Collateral Agent shall be indemnified to the extent and in accordance with the indemnities provided in the Bank Loan Agreement, Bank Security Agreement and the SBA Security Agreement and notwithstanding that such provisions are not expressly applicable to the Collateral Agent, all such provisions shall, unless the context clearly indicates otherwise, be read to include and run to the benefit of the Collateral Agent.

(d) Except as expressly provided herein or in the Security Documents, the Collateral Agent shall have no duty to take any affirmative steps with respect to the collection of amounts payable in respect of the Collateral.

(e) The Collateral Agent may resign at any time by giving at least 10 days notice thereof to the parties (such resignation to take effect as hereinafter provided). In the event of any such resignation of the Collateral Agent, the other parties shall have the right to appoint a successor Collateral Agent which appointment shall, unless an Acceleration has occurred and is continuing, be subject to the approval of the Borrower, provided, however, that if the bank then holding the position of the Bank Agent is then willing to serve as the Collateral Agent and if such Bank Agent is a bank which is qualified to act as the successor Collateral Agent (pursuant to the fourth sentence of this paragraph), then the Bank Agent shall, upon its acceptance as the successor Collateral Agent, become the successor Collateral Agent without any further act by any other party hereto. If no successor Collateral Agent shall have been so appointed by the other parties and shall have accepted such appointment within 30 days after the notice of the notice of intent of the Collateral Agent to resign, then the retiring Collateral Agent may apply to a court of competent jurisdiction for the appointment of a successor Collateral Agent. Any successor Collateral Agent appointed pursuant to this paragraph shall be a bank party to the Loan Agreement or a commercial bank organized under the laws of the United States of America or any state thereof and having a combined capital and surplus of at least $250,000,000. Upon the acceptance of any appointment as Collateral Agent hereunder by a successor Collateral Agent and the transfer of any Collateral held by the retiring Collateral Agent to the successor Collateral Agent, such successor Collateral Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Collateral Agent, and the retiring or removed Collateral Agent shall thereupon be discharged from its

duties and obligations hereunder. After any retiring or removed Collateral Agent's resignation or removal hereunder as Collateral Agent, the provisions of this Section 6 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Collateral Agent.

(f) Notwithstanding the fact that certain of the provisions of this Agreement apply to the Secured Parties, it is expressly agreed that neither the Collateral Agent, the Bank Agent nor the SBA Agent shall have any responsibility for ensuring performance by such Secured Party(ies), nor any liability whatsoever for their failure to so perform.

SECTION 8. MISCELLANEOUS.

(a) NOTICES. All notices and other communications provided for herein shall be in writing and may be personally served, telecopied, telexed or sent by United States mail and shall be deemed to have been given when delivered in person, upon receipt of telecopy or telex, or four Business Days after deposit in the United States mail, registered or certified, with postage prepaid and properly addressed. For the purposes hereof, the addresses of the parties hereto (until notice of a change thereof is delivered as provided in this section) shall be as provided in the Bank Security Agreement and the SBA Security Agreement.

(b) PARTIES. This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto.

(c) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE LAWS OF ANOTHER JURISDICTION ARE MANDATORILY APPLICABLE TO THE EXERCISE OF REMEDIES OR THE PERFECTION OF SECURITY INTERESTS UNDER THE UCC.

(d) WAIVER OF JURY TRIAL AND SETOFF. EACH OF PARTIES HERETO HEREBY WAIVES TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT, OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF, OR ANY OTHER CLAIM OR DISPUTE, HOWSOEVER ARISING, BETWEEN BORROWER AND ANY OTHER PARTY; AND BORROWER HEREBY WAIVES THE RIGHT TO INTERPOSE ANY SETOFF, COUNTERCLAIM OR CROSS-CLAIM IN CONNECTION WITH ANY SUCH LITIGATION, IRRESPECTIVE OF THE NATURE OF SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION).

(e) JURISDICTION; SERVICE OF PROCESS. Borrower hereby irrevocably consents to the Jurisdiction of the Courts of the State of New York, County of New York and of any Federal Court located in the Southern District of New York, and agrees that venue in each of such Courts is proper in connection with any action or proceeding arising out of or relating to this Agreement. Nothing herein shall affect the right of the other parties to serve process in any other manner permitted by law or to commence legal proceedings or otherwise proceed against Borrower in any other jurisdiction.

(f) WAIVERS AND MODIFICATIONS. This Agreement may be modified or waived only by an instrument or instruments in writing signed by all of the parties hereto.

(g) TERMINATION. Upon the earlier to occur of (i) receipt by the Collateral Agent of evidence satisfactory to it of the termination of all commitments to extend credit which would constitute Revolving Obligations and the indefeasible payment in full of all Revolving Obligations, and (ii) receipt by the Collateral Agent of evidence satisfactory to it of the indefeasible payment in full of all SBA Obligations (including, without limitation, the reasonable compensation, expenses and disbursements of the Collateral Agent), this Agreement shall terminate, provided that Section 7 of this Agreement shall survive, and remain operative and in full force and effect, regardless of the termination of this Agreement.

(h) SEVERABILITY. To the extent any provision of this Agreement is prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

(i) RIGHTS AND REMEDIES NOT WAIVED. No course of dealing between the Borrower and the Collateral Agent or any other party, and no failure on the part of the Collateral Agent or any other party to exercise any rights or remedies hereunder shall operate as a waiver of any rights or remedies of the Collateral Agent or any other party, and no single or partial exercise of any rights or remedies hereunder shall operate as a waiver or preclude the exercise of any other rights or remedies hereunder.

(j) COUNTERPARTS. This Agreement may be executed by the parties hereto in counterparts, each of which shall be an original and all of which shall together constitute one and the same agreement.

(k) BORROWER AGREEMENT TO BE BOUND HEREBY. By countersigning this Agreement, the Borrower acknowledges and

consents to and agrees to perform and be bound by each of the provisions hereof stated to be applicable to it.

IN WITNESS WHEREOF, this Agreement has been executed as of the date first above written by the duly authorized officers of the parties hereto.

FLEET BANK, N.A.,
as Bank Agent, SBA Agent and
Collateral Agent

By:______________________________
Name:
Title:

UNITED STATES SMALL BUSINESS
ADMINISTRATION

By:______________________________
Name:
Title:

The foregoing is agreed to:
MEDALLION FUNDING CORP.

By:_________________________________________ Name: Alvin Murstein
Title: Chief Executive Officer

By:_________________________________________ Name: Daniel F. Baker
Title: Treasurer and Chief Financial Officer

EXHIBIT H

SBA COLLATERAL - DESIGNATED COMMERCIAL LOANS

The are no loans designated as SBA Collateral as of the Effective Date.

EXHIBIT I

EXHIBIT J

EXHIBIT K

Dated ___________

Reference is hereby made to the Amended and Restated Loan Agreement dated as of December __, 1997 (the "Loan Agreement") by and among MEDALLION FUNDING CORP., a New York corporation ("Borrower"), the banks that from time to time are signatories thereto (including Assignees (as hereinafter defined), collectively, the "Banks" and individually, a "Bank"), FLEET BANK, NATIONAL ASSOCIATION , as a Bank ("Fleet"), as swing line lender (the "Swing Line Lender"), as Arranger and as Agent for the Banks (including any successor, the "Agent") and The Bank of New York, as a Bank ("BONY") and as Documentation Agent. Capitalized terms used herein that are defined in the Loan Agreement that are not otherwise defined herein shall have the respective meanings ascribed thereto in the Loan Agreement.

_______________________________, a __________________ (the "Assignor") and _______________________________________, a ________________, (the "Assignee") agree as follows:

1. The Assignor hereby sells and assigns to the Assignee, and the Assignee hereby purchases and assumes from the Assignor, a __ % interest in and to all of the Assignor's rights and obligations under the Loan Agreement as of the Effective Date (as defined below) (including, without limitation, such percentage interest in the Assignor's Revolving Credit Commitment and Term Loan Commitment as in effect on the Effective Date, and the Revolving Credit Loans and/or Term Loans owing to the Assignor on the Effective Date, and the Note(s) held by the Assignor).

2. The Assignor: (i) represents and warrants that as of the date hereof its Revolving Credit and Term Loan Commitment (without giving effect to assignments thereof that have not yet become effective) is $__________ and the aggregate outstanding principal amount of Revolving Credit Loans and Term Loans owing to it (without giving effect to assignments thereof that have not yet become effective) is $__________; (ii) represents and warrants that it is the legal and beneficial owner of the interest being assigned by it hereunder, and that such interest is free and clear of any adverse claim; (iii) makes no representation or warranty and assumes no

responsibility with respect to any statements, warranties or representations made in or in connection with the Loan Agreement or any other instrument or document furnished pursuant thereto; and (iv) makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Borrower or any other Person or the performance or observance by the Borrower or any other Person of any of its obligations under the Loan Agreement or any other instrument or document furnished pursuant thereto; and (v) attaches the Note(s) referred to in paragraph 1 above and requests that the Agent exchange such Note(s) for new Note(s) as follows: [a Revolving Credit Note dated the Effective Date (as such term is defined below) in the principal amount of $ __________ payable to the order of the Assignee, a Revolving Credit Note dated the Effective Date in the principal amount of $ __________ payable to the order of the Assignor, a Term Note dated the Effective Date in the principal amount of $________ payable to the order of the Assignee and a Term Note dated the Effective Date in the principal amount of $________ payable to the order of the Assignor.]

3. The Assignee: (i) confirms that it has received a copy of the Loan Agreement, together with copies of such financial statements and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment; (ii) agrees that it will, independently and without reliance upon the Agent, the Assignor or any other Bank and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Agreement; (iii) confirms that it is an Assignee permitted by the Loan Agreement; (iv) appoints and authorizes the Agent to take such action as its agent on its behalf and to exercise such powers under the Loan Agreement as are delegated to the Agent by the terms thereof, together with such powers as are reasonably incidental thereto; (v) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Loan Agreement are required to be performed by it as a Bank; and (vi) specifies as its addresses for Prime Rate Loans and LIBO Rate Loans (and address for notices) the offices set forth beneath its name on the signature pages hereof.

4. The effective date for this Assignment shall be ________________ (the "Effective Date"). Following the

execution of this Assignment, it will be delivered to the Agent for acceptance by the Agent.

5. Upon such acceptance, as of the Effective Date: (i) the Assignee shall be a party to the Loan Agreement and, to the extent provided in this Assignment, have the rights and obligations of a Bank thereunder and (ii) the Assignor shall, to the extent provided in this Assignment, relinquish its rights and be released from its obligations under the Loan Agreement.

6. Upon such acceptance, from and after the Effective Date, the Agent shall make all payments under the Loan Agreement and the Note(s) in respect of the interest assigned hereby (including, without limitation, all payments of principal, interest and commitment fees with respect thereto) to the Assignee. The Assignor and Assignee shall make all appropriate adjustments in payments under the Loan Agreement and the Note(s) for periods prior to the Effective Date directly between themselves.

7. This Assignment shall be governed by, and construed in accordance with, the laws of the State of New York.

[NAME OF ASSIGNOR]

By_____________________________
Name:
Title:

[NAME OF ASSIGNEE]

By______________________________
Name:
Title:

Lending Office for Prime Rate Loans:

Lending Office for LIBO Rate Loans:

Attention:

Address for Notices:

Attention:

Telephone No.:

Telex No.:

Accepted this ___ day

of ______________, 199_

FLEET BANK, N.A., as Agent

By___________________________
Title

EXHIBIT L

                                 Key Executives
                                 --------------

Alvin Murstein            Chief Executive Officer
                          Director

Daniel F. Baker           Chief Financial Officer
                          Treasurer

Michael Kowalsky          President

Marie Russo               Senior Vice President

Michael Fanger            Executive Vice President

SCHEDULE III

Subsidiaries

EXHIBIT 10.51

Revolving Credit Note, dated December 24, 1997, in the amount of $30,000,000 from Medallion Funding Corp. payable to Fleet Bank, National Association

$30,000,000.00 No. 1 December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of FLEET BANK, NATIONAL ASSOCIATION (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) THIRTY MILLION AND 00/100 DOLLARS ($30,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    ____________________
    Alvin Murstein
    CEO


By: /s/ Daniel F. Baker
    --------------------
     Daniel F. Baker
     Treasurer & CFO

EXHIBIT 10.52

Revolving Credit Note dated December 24, 1997, in the amount of $30,000,00 from Medallion Funding Corp payable to the Bank of New York.

REVOLVING CREDIT NOTE

$30,000,000.00 No. 2 December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of THE BANK OF NEW YORK (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) THIRTY MILLION AND 00/100 DOLLARS ($30,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
    Alvin Murstein
    CEO


By: /s/ Daniel. F. Baker
    --------------------
    Daniel F. Baker
    Treasurer & CFO

EXHIBIT 10.53

REVOLVING CREDIT NOTE

$30,000,000.00 No. 3

December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of BANKBOSTON, N.A. (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) THIRTY MILLION AND 00/100 DOLLARS ($30,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
    Alvin Murstein
    CEO


By: /s/ Daniel F. Baker
    --------------------
    Daniel F. Baker
    Treasurer & CFO

EXHIBIT 10.54

REVOLVING CREDIT NOTE

$20,000,000.00 No. 4 December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of HARRIS TRUST AND SAVINGS BANK (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) TWENTY MILLION AND 00/100 DOLLARS ($20,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
     Alvin Murstein
     CEO


By: /s/ Daniel F. Baker
    --------------------
     Daniel F. Baker
     Treasurer & CFO

EXHIBIT 10.55

REVOLVING CREDIT NOTE

$20,000,000.00 No. 5 December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of BANK TOKYO - MITSUBISHI TRUST COMPANY (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of
(a) TWENTY MILLION AND 00/100 DOLLARS ($20,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
    Alvin Murstein
    CEO


By: /s/ Daniel F. Baker
    --------------------
    Daniel F. Baker
    Treasurer & CFO

EXHIBIT 10.56

REVOLVING CREDIT NOTE

$15,000,000.00 No. 6

December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of ISRAEL DISCOUNT BANK OF NEW YORK (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) FIFTEEN MILLION AND 00/100 DOLLARS ($15,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
    Alvin Murstein
    CEO


By: /s/ Daniel F. Baker
    --------------------
    Daniel F. Baker
    Treasurer & CFO

EXHIBIT 10.57

REVOLVING CREDIT NOTE

$15,000,000.00 No. 7 December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of EUROPEAN AMERICAN BANK (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) FIFTEEN MILLION AND 00/100 DOLLARS ($15,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
    Alvin Murstein
    CEO


By: /s/ Daniel F. Baker
    --------------------
    Daniel F. Baker
    Treasurer & CFO

EXHIBIT 10.58

REVOLVING CREDIT NOTE

$15,000,000.00 No. 8 December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of BANK LEUMI USA (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) FIFTEEN MILLION AND 00/100 DOLLARS ($15,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
    Alvin Murstein
    CEO


By: /s/ Daniel F. Baker
    --------------------
    Daniel F. Baker
    Treasurer & CFO

EXHIBIT 10.59

REVOLVING CREDIT NOTE

$20,000,000.00 No. 9 December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Maturity, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of THE CHASE MANHATTAN BANK (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) TWENTY MILLION AND 00/100 DOLLARS ($20,000,000.00) and (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the

occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), (a) the outstanding principal amount of this Note which at such time is a Prime Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 2% plus the Prime Rate applicable to such Prime Rate Loan then in effect and
(b) the outstanding principal amount of this Note which is a LIBO Rate Loan (including, to the extent permitted by law, unpaid interest thereon) shall bear interest at an annual rate equal to the sum of 3.75% plus the Adjusted LIBO Rate applicable to such LIBO Rate Loan then in effect, in each case payable on demand, but in no event shall such rate of interest (the "Default Rate") be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed. If the Default Rate is to be based on the Prime Rate, the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. At the end of the applicable Interest Period for a LIBO Rate Loan on which the Default Rate is being charged, such LIBO Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be computed based on the Prime Rate.

This Note is one of the Revolving Credit Notes referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Revolving Credit Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS REVOLVING CREDIT NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS REVOLVING CREDIT NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Revolving Credit Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
    Alvin Murstein
    CEO


By: /s/ Daniel F. Baker
    --------------------
    Daniel F. Baker
    Treasurer & CFO

EXHIBIT 10.60

Swing Line Note, dated December 24, 1997, in the amount of $5,000,000 from Medallion Funding Corp. payable to Fleet Bank, National Association.

SWING LINE NOTE

$5,000,000.00 No. SL December 24, 1997

FOR VALUE RECEIVED, the undersigned, Medallion Funding Corp., a New York corporation (the "Borrower"), hereby unconditionally promises to pay on the date of Swing Line Maturity Date, as defined in the Loan Agreement (hereinafter referred to) or on such earlier date as may be required under the Loan Agreement, to the order of FLEET BANK, NATIONAL ASSOCIATION (the "Bank") at the Agent Payment Office (as defined in the Loan Agreement), in lawful money of the United States of America and in immediately available funds, an amount equal to the lesser of (a) FIVE MILLION AND 00/100 DOLLARS ($5,000,000.00) and (b) the aggregate unpaid principal amount of all Swing Line Loans made by the Bank to the Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 24, 1997, as amended, among the Borrower, the banks that from time to time are signatories thereto, the Swing Line Lender, Fleet Bank NA as Arranger and Agent, and The Bank of New York as Documentation Agent (as amended, modified or supplemented from time to time in accordance with its terms, the "Loan Agreement"). The Borrower further promises to pay interest (computed on the basis of a 360-day year for the actual number of days elapsed) in like money on the unpaid principal balance of this Note from time to time outstanding at such rates and times as provided in the Loan Agreement.

All Swing Line Loans made by the Bank pursuant to the Loan Agreement and all payments of the principal thereof shall be endorsed by the holder of this Note on the schedule annexed hereto (including any additional pages such holder may add to such schedule), which endorsement shall constitute

On and after the stated or any accelerated maturity hereof, and until paid in full (whether before or after the occurrence of any Event of Default described in Sections 9.1(g) and 9.1(h) of the Loan Agreement), the outstanding principal amount of this Note (including, to the extent permitted by law, unpaid interest thereon) shall bear interest (the "Default Rate") at an annual rate equal to the sum of 2% plus the Negotiated Rate applicable to such Swing Line Loan then in effect. At the end of the applicable Swing Line Interest Period for a Negotiated Rate Loan on which the Default Rate is being charged, such Negotiated Rate Loan shall be automatically converted to a Prime Rate Loan, and the Default Rate to be charged in respect of such Loan shall be at an annual rate equal to the sum of 2% plus the Prime Rate then in effect and the Prime Rate to be charged shall change when and as the Prime Rate is changed, and any such change in the Prime Rate shall become effective at the opening of business on the day on which such change is adopted. In each case, interest at the Default Rate shall be payable on demand, but in no event shall such rate of interest be in excess of the maximum rate of interest permitted under applicable law. The Default Rate shall be computed on the basis of a 360-day year for the actual number of days elapsed.

This Note is the Swing Line Note referred to in the Loan Agreement, is secured as provided therein, is entitled to the benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. The Borrower shall make when due any and all payments and prepayments on this Swing Line Note required under the Loan Agreement. Reference is herein made to the Loan Agreement for

the rights of the holder to accelerate the unpaid balance hereof prior to maturity.

Borrower hereby waives diligence, demand, presentment, protest and notice of any kind, release, surrender or substitution of security, or forbearance or other indulgence, without notice.

Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to them in the Loan Agreement.

This Note may not be changed, modified, or terminated orally, but only by an agreement in writing signed by the party to be charged.

IN THE EVENT OF ANY LITIGATION WITH RESPECT TO THIS SWING LINE NOTE, THE BORROWER WAIVES (TO THE EXTENT PERMITTED BY LAW) THE RIGHT TO A TRIAL BY JURY, ALL RIGHTS OF SETOFF AND RIGHTS TO INTERPOSE COUNTERCLAIMS AND CROSS- CLAIMS AGAINST THE BANK (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION) AND THE DEFENSES OF FORUM NON CONVENIENS AND IMPROPER VENUE. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, COUNTY OF NEW YORK AND OF ANY FEDERAL COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS SWING LINE NOTE. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES, AND SHALL BE BINDING UPON THE SUCCESSORS AND ASSIGNS OF BORROWER AND INURE TO THE BENEFIT OF THE BANKS AND ITS SUCCESSORS AND ASSIGNS. If any term or provision of this Swing Line Note shall be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

IN WITNESS WHEREOF, Borrower has executed and delivered this Note on the date first above written.

MEDALLION FUNDING CORP.,
a New York Corporation

By: /s/ Alvin Murstein
    --------------------
    Alvin Murstein
    CEO


By: /s/ Daniel F. Baker
    --------------------
    Daniel F. Baker
    Treasurer & CFO

EXHIBIT 10.61

AMENDED AND RESTATED
SECURITY AGREEMENT,
DATED AS OF DECEMBER 24, 1997,

between

MEDALLION FUNDING CORP., as debtor

and

FLEET BANK, N.A., as Agent
and secured party,

for the benefit of

THE BANKS AND SWING LINE LENDER SIGNATORY TO
THE AMENDED AND RESTATED LOAN
AGREEMENT, DATED AS OF DECEMBER 24, 1997,
AMONG MEDALLION FUNDING CORP.,
THE BANKS SIGNATORY THERETO, THE SWING LINE LENDER,THE BANK OF NEW YORK AS
DOCUMENTATION AGENT
AND FLEET BANK, N.A. AS ARRANGER AND AGENT

and

THE HOLDERS OF COMMERCIAL PAPER
ISSUED BY
MEDALLION FUNDING CORP.

TABLE OF CONTENTS

This table of contents is not a part of the document but is provided for ease of reference.

SECTION Page

                                   ARTICLE I
                                  DEFINITIONS

SECTION 1.1.    Defined Terms                                           2
SECTION 1.2.    Accounting Terms                                        6
SECTION 1.3.    Rules of Construction                                   6

                                   ARTICLE II
                         CREATION OF SECURITY INTEREST

SECTION 2.1.    Grant of Security Interest to Agent                     7
SECTION 2.2.    Perfection                                              7
SECTION 2.3.    Recording, Registering, Filing, Etc.                    7
SECTION 2.4.    Delivery of Documents                                   8
SECTION 2.5.    Further Assurances                                      9
SECTION 2.6.    Appointment of Agent as Attorney-in-Fact                9
SECTION 2.7.    Indemnity                                              10
SECTION 2.8.    Borrower Remains Liable                                11
SECTION 2.9.    Agent May Perform                                      11
SECTION 2.10.   Agent's Duties                                         11

                                  ARTICLE III
                         PRIORITY OF SECURITY INTERESTS

SECTION 3.1.    Priority of Security Interests                          11

                                   ARTICLE IV
                                   COLLATERAL

SECTION 4.1.    Representations, Covenants and Warranties               12
SECTION 4.2.    Collections                                             13
SECTION 4.3.    Rights of Agent Regarding Collateral                    14

                                   ARTICLE V
                                    DEFAULT

SECTION 5.1.    Events of Default                                       14
SECTION 5.2.    Remedies                                                14
SECTION 5.3.    Application of Proceeds                                 17
SECTION 5.4.    Waiver by Agent or Banks                                18

                                   ARTICLE VI
                                 MISCELLANEOUS

SECTION 6.1.    Continuing Lien                                         18
SECTION 6.2.    Waivers by Borrower                                     18
SECTION 6.3.    Parties                                                 19
SECTION 6.4.    GOVERNING LAW                                           19
SECTION 6.5.    WAIVER OF JURY TRIAL AND SETOFF                         19

SECTION 6.6.    Jurisdiction; Service of Process                        19
SECTION 6.7.    Survival of Representations and Warranties              20
SECTION 6.8.    Obligations Secured by Property Other Than Collateral   20
SECTION 6.9.    Successor Agent                                         20
SECTION 6.10.   Termination                                             20
SECTION 6.11.   Notices                                                 21
SECTION 6.12.   Severability                                            21
SECTION 6.13.   Counterparts                                            21

AMENDED AND RESTATED
SECURITY AGREEMENT

RECITALS

WHEREAS, a condition precedent to the obligation of the Banks to make the Revolving Credit Loans or Term Loans under the Loan Agreement is that Borrower grant to the Agent perfected, security interests in all of the Collateral to secure the payment and performance of all of the obligations of Borrower owing to the Agent and the Banks pursuant to the Loan Agreement and other documents.

WHEREAS, in partial satisfaction of Borrower's obligation under Sections 5.1 and 5.2 of the Loan Agreement and otherwise as an inducement necessary to the Banks' making the Revolving Credit Loans or Term Loans to Borrower, Borrower agrees to grant to the Agent a security interest in the Collateral pursuant to the terms set forth herein.

WHEREAS, the Borrower expects to enter into a Commercial Paper Dealer Agreement (as defined in the Loan Agreement) and a Paying Agency Agreement (as defined in the Loan Agreement) pursuant to which the Borrower proposes to issue Commercial Paper from time to time to provide financing for its operations; and

WHEREAS, the Borrower has asked the Banks to consent, and the Banks have agreed, to the granting of a security interest in the Collateral to secure its obligations to the holders (the

"CP Holders") of the Commercial Paper pari passu with the security interest held by the Agent for the benefit of the Banks; and

WHEREAS, the Borrower has asked the Banks to consent to the granting of a security interest in a pool of its Commercial Loans (and under certain circumstances a subordinate lien in all of its assets) pursuant to a Security Agreement among the Borrower, the Agent and the SBA (the "SBA Security Agreement), providing for a lien on such Commercial Loans (the "SBA Collateral") to secure a note originally made by Transportation Capital Corp., a New York corporation ("TCC"), dated June 24, 1992, in the principal amount of $5,640,000, and notes originally made by Edwards Capital Corp., a Delaware corporation ("Edwards"), in the aggregate original principal amount of $22,250,000, which have become the obligations of the Borrower upon the merger of TCC and Edwards into the Borrower; and

WHEREAS, the Banks are willing to consent to the grant of the security interest in the Collateral to the Agent for the benefit of the CP Holders and to the grant of the security interest in the SBA Collateral to the Agent for the benefit of the SBA pursuant to the SBA Security Agreement, provided that the Security Agreement is amended in accordance herewith and provided, further that in the case of the CP Holders such security interest granted to the Agent for their benefit shall not be effective unless and until (i) the Agent has been appointed the Agent of the CP Holders for purposes of this Agreement with duties consistent with those necessary for the Agent (in its opinion) to perform its duties under this Agreement, (ii) the CP Holders shall have consented to the terms of this Agreement and to the Agent's entering into the Intercreditor Agreement on their behalf and (iii) the Agent shall have provided the CP Holders written notification that it has been indemnified, in a manner satisfactory to the Agent, by such CP Holders with respect to the Agent's responsibilities hereunder on behalf of such CP Holders;

WHEREAS, in furtherance of the grant of the security interest in the SBA Collateral, the Banks are also willing to consent to an Intercreditor Agreement (the "Intercreditor Agreement"), effective upon the effectiveness of the SBA Security Agreement, setting forth the relative rights of the Agent for the benefit of the Banks and the CP Holders pursuant to this Agreement and the rights of the Agent for the benefit of the SBA pursuant to the SBA Security Agreement;

NOW, THEREFORE, in consideration of the willingness of the Agent and the Banks to enter into the Loan Agreement and to agree, subject to the terms and conditions thereof, to make the Revolving Credit Loans or Term Loans to Borrower pursuant thereto, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower and the Agent hereby covenant and agree as follows:

ARTICLE I
DEFINITIONS

SECTION 1.1. DEFINED TERMS. Capitalized terms defined in the foregoing caption and recitals shall have the respective meanings ascribed thereto. Capitalized terms

defined in the Loan Agreement and not otherwise defined in this Agreement shall have the meanings ascribed to those terms in the Loan Agreement. In addition, as used herein, the following terms shall have the following meanings:

(a) all Loans;

(b) all property and rights, including, but not limited to, Underlying Collateral, which now or hereafter secure Loans;

(c) all Books and Records;

(d) all amounts deposited in any Collateral Account;

(e) all Contracts;

(f) all rights and remedies of Borrower with respect to, or in connection with, any contract, security interest, guaranty or other document, instrument or agreement relating to or affecting any Loans or any Underlying Collateral;

(g) all General Intangibles;

(h) all Instruments;

(i) all Chattel Paper;

(j) all Equipment;

(k) all Inventory;

(1) all Investments;

(m) all Investment Property;

(n) all Accounts

(o) all property and rights, including, but not limited to, items described in clauses (b) through (n) hereof, repossessed, or otherwise acquired in connection with any Loans or the exercise by Borrower of any rights of a secured party under or with respect to any of the Loans or this Agreement or arising out of the sale or disposition of any Loans, any other Collateral, or in connection with the sale of any repossessed property;

(p) all parts, accessions, accessories, goods, appurtenant or related to any of the foregoing, replacement parts, trade names, closes in action, now or hereafter affixed thereto, arising therefrom, used in connection therewith, or related to the use, possession or operation thereof;

(q) all cash and Short-Term Investments; and

(r) to the extent not otherwise included, all Proceeds, products, substitutions and replacements of any and all of the foregoing.

revenue accounting records, invoices, leases, licenses, authorizations for expenditures, contracts and such other documents, information and data as any Bank may request pursuant to the Loan Agreement.

"Laws" shall have the meaning set forth in Section 2.2 hereof.
 ----

"Loan" shall mean any loan, advance or extension of credit made in the
 ----

ordinary course of business by Borrower to or for the account of any client or customer of Borrower. Any loan, advance or extension of credit made at a different point in time shall be deemed to be a separate and distinct Loan.

agreements, variances, franchises, permissions, and permits of any Governmental Authority and all documents and applications filed in connection therewith, and
(b) all renewals thereof.

SECTION 1.2. ACCOUNTING TERMS. Any accounting term used in this Agreement shall have, unless otherwise specifically provided herein, the meaning customarily given in accordance with GAAP, and all financial computations hereunder shall be computed, unless otherwise specifically provided herein, in accordance with GAAP.

SECTION 1.3. RULES OF CONSTRUCTION. (a) Words of the masculine gender shall mean and include correlative words of the female and neuter genders, and words importing the singular number shall mean and include the plural number and vice versa.

(c) Any defined term that relates to a document shall include within its definition any amendments, modifications, renewals, restatements, extensions, supplements, or substitutions which may have been heretofore or may be hereafter executed in accordance with the terms thereof.

(d) References in this Agreement to particular sections of the UCC or to any other legislation shall be deemed to refer also to any successor sections thereto or other redesignations for codification purposes. Unless otherwise indicated, references in this Agreement to the UCC shall mean the UCC as in effect in the State of New York.

(e) All terms used in this Agreement that are not capitalized shall have the meanings provided by the UCC as in effect in the State of New York to the extent the same are used or defined therein.

ARTICLE II
CREATION OF SECURITY INTEREST

SECTION 2.1. GRANT OF SECURITY INTEREST TO AGENT. To induce the Banks to make the Revolving Credit Loans or Term Loans to Borrower and, as security for any and all Obligations of Borrower, and as security for Borrower's Permitted Debt owing to the CP Holders, Borrower hereby grants to the Agent for the ratable benefit of the Agent, the Banks and the CP Holders a continuing lien on and security interest in the Collateral, which shall be a first priority lien except as provided in the Intercreditor Agreement, and, in furtherance of such grant, Borrower hereby assigns for security all the Collateral to the Agent for the ratable benefit of the Agent, the Banks and the CP Holders.

certificates of title, conveyances, assignment statements, financing statements, renewal financing statements, security agreements, affidavits, mortgages, mortgage assignments, trust deeds, notices and all other agreements, instruments and documents that the Agent reasonably may request, in form satisfactory to the Agent, and shall take any and all other steps reasonably requested by the Agent, in order to perfect and maintain the security interests and liens granted herein, and to consummate fully all of the transactions contemplated under this Agreement and any Other Agreements.

SECTION 2.3. RECORDING, REGISTERING, FILING, ETC. At any time or times after (i) a Default or an Event of Default has occurred or (ii) any change in any existing Law or the proposal by any Governmental Authority of a new Law which, in the Agent's opinion, adversely affects the validity, security or perfection of the security interests and liens granted herein, Borrower will perform, or will cause to be performed, each of the following:

(a) Record, register and file such notices, certificates of title, financing statements, mortgage assignments, trust deeds and other documents or instruments as may, from time to time, be requested by the Agent to carry out fully the intent of this Agreement, with such administrations or governmental agencies as may be necessary or advisable in order to perfect, establish, confirm, and maintain the security interests and liens created hereunder, as legal, valid, and binding security interests and liens upon the Collateral;

(b) Furnish to the Agent evidence of every such recording, registering and filing; and

(c) Execute and deliver or perform, or cause to be executed and delivered or performed, such further and other instruments or acts as the Agent reasonably determines are necessary or desirable to fully carry out the intent and purpose of this Agreement or to subject the Collateral to the security interest and lien created hereunder, including, without limitation, defending the title of Borrower to the Collateral by means of negotiation with and, if necessary, appropriate legal proceedings against, each party claiming an interest therein contrary or adverse to Borrower's title to same.

access to the Collateral Notes and (ii) the Agent shall, in its sole discretion, be entitled to have one of its employees, agents or representatives present at all times or from time to-time during any such period of access.

(b) Upon the Agent's request, Borrower shall immediately deliver to the Agent or its designee, at Borrower's expense, copies of all documents, chattel paper, security agreements, guarantees and other writings evidencing any Loan or its related Underlying Collateral.

(c) At any time on or after a Default or Event of Default, upon the Agent's request, Borrower shall immediately deliver to the Agent or its designee all documents, instruments, chattel paper, security agreements, guarantees and other writings so requested by the Agent evidencing any Collateral of Borrower, such documents, instruments, chattel paper, security agreements, guarantees and other writings to be held as Collateral under the terms of this Agreement.

(d) The Agent shall have no obligation to inspect or examine any of the Collateral Notes or other documents delivered to it by Borrower hereunder, and shall be entitled to assume, and shall be fully protected in assuming, without inspection or examination, that Borrower has complied in full with its delivery obligations hereunder.

SECTION 2.5. FURTHER ASSURANCES. (a) At any time or times after (i) a Default or an Event of Default has occurred or (ii) any change in any existing Law or the proposal by any Governmental Authority of a new Law which, in the Agent's opinion, adversely affects the validity, security or perfection of the security interests and liens granted herein, then, in addition to the acts specifically required to be performed by Borrower elsewhere under this Agreement, Borrower shall do all other things and sign and deliver all other documents and instruments reasonably requested by the Agent to perfect, protect, maintain and enforce the security interests and liens of the Agent in the Collateral, and the first priority of such security interests and liens, and other rights granted hereunder or under any other present or future agreement between Borrower and the Agent, including, without limitation, the Loan Documents. Such acts shall include but not be limited to the marking of Borrower's Books and Records, the chattel paper and instruments to show the Agent's security interests and liens and the filing of financing, renewal and/or continuation statements under the UCC or other documents evidencing the Agent's liens under applicable law and the delivery of any Collateral the physical possession of which is necessary or desirable in order for the Agent to perfect its liens. Upon the occurrence of any of the events specified in subclauses (i) and (ii) of this Section 2.5(a), Borrower authorizes the Agent to execute alone any financing, renewal and/or continuation statement or any other document or instrument which the Agent may require to perfect, protect, continue or enforce in accordance herewith any security interest, lien or other right hereunder or under any of the other Loan Documents and authorizes the Agent to sign Borrower's name on the same. Upon payment in full by Borrower of all the Obligations in

accordance with the terms thereof, the security interests and liens granted by Borrower hereunder shall terminate, except that if, at any time, all or part of the payment of the monetary Obligations theretofore made by Borrower or any other Person is rescinded or otherwise must be returned by the Agent or any Bank for any reason whatsoever (including, without limitation, the insolvency, bankruptcy or reorganization of Borrower or such other Person), the security interests and liens granted hereunder or under any other present or future agreement between Borrower and the Agent, and all rights of the Agent and all Obligations shall be reinstated as to monetary Obligations which were satisfied by the payment to be rescinded or returned, all as though such payment had not been made, and Borrower shall sign and deliver to the Agent all documents and things necessary to perfect all terminated liens subject to the intervening liens, if any, granted by Borrower to any Person.

(b) A carbon, photographic, or other reproduction of this Agreement shall be sufficient as a UCC filing and may be filed in any appropriate office in lieu thereof.

(c) Upon the occurrence of any of the events specified in subclauses (i) and (ii) of Section 2.5(a), to the extent requested by the Agent, Borrower will use its best efforts to cause each mortgagee of any and all real estate under any lease included in any Underlying Collateral and each landlord under any lease included in any Underlying Collateral to execute and deliver to the Agent assignments, in form and substance satisfactory to the Agent, by which such mortgagee or landlord waives its rights, if any, to the Collateral.

SECTION 2.6. APPOINTMENT OF AGENT AS ATTORNEY-IN-FACT. Upon the occurrence of any of the events specified in subclause (i) of Section 2.5(a), Borrower does hereby irrevocably make, constitute and appoint the Agent and any of its officers, employees or agents as the true and lawful attorneys of Borrower with power to:

(a) sign the name of Borrower on any financing statement, renewal financing statement, notice or other similar document that in the Agent's opinion must be filed in order to perfect or continue perfected the security interests granted in this Agreement or any Other Agreements;

(b) receive, endorse, assign and deliver, in Borrower's name or in the name of the Agent, all checks, notes, drafts and other instruments relating to any Collateral, including receiving, opening and properly disposing of all mail addressed to Borrower concerning the Collateral and, during the existence of an Event of Default (as hereinafter defined), to notify postal authorities to change the address for delivery of mail to such address as the Agent may designate;

(c) sign Borrower's name on any notices to any of Borrowers clients or customers; and

(d) upon the occurrence and during the continuance of an Event of Default, take or bring at Borrower's cost, in Borrower's name or in the name of the Agent, all steps, actions and suits deemed by the Agent necessary or desirable to effect collections in connection with any Loans, to enforce payment in connection with any Loans, to settle, compromise or release in whole or in part, any amounts owing in connection with any Loans, to prosecute any action or proceeding with respect to any Loans, to extend the time of payment in connection with any Loans, to make allowances and adjustments with respect thereto, to secure credit in the name of the Agent, and to do all other things necessary or desirable to realize upon the Collateral, including but not limited to the Underlying Collateral, and to carry out this Agreement and all Other Agreements.

Neither the Agent nor its agents or attorneys will be liable for any act or omission nor for any error of judgment or mistake of fact unless such act, omission, error or mistake shall occur as a result of their gross negligence or willful misconduct. This power, being coupled with an interest, is irrevocable so long as the Obligations remain unpaid.

SECTION 2.7. INDEMNITY. In addition to all of the Agent's and Banks' other rights and remedies under the Loan Documents, Borrower will hold the Banks and the Agent from and indemnify the Banks and the Agent or other designee of the Agent against all losses, damages, costs and expenses (including, without limitation, attorneys' fees, costs and expenses) incurred by any of them, whether prior to or from and after the date hereof, whether direct, indirect or consequential, as a result of or arising from or relating to any suit, investigation, action or proceeding by any Person, whether threatened or initiated, asserting a claim for any legal or equitable remedy against any Person under any statute or regulation, including without limitation, any Federal or state antitrust laws, or under any common law or equitable cause or otherwise, all to the extent arising from or in connection with this Agreement or the other Loan Documents or the enforcement of the rights of the Agent hereunder, other than losses, damages, costs and expenses resulting from, but only to the extent resulting from, the willful misconduct or gross negligence of the Person seeking indemnification.

SECTION 2.8. BORROWER REMAINS LIABLE. Anything herein to the contrary notwithstanding, (i) Borrower shall remain liable under the contracts and agreements included in the Collateral to the extent set forth therein to perform all of its duties and obligations thereunder to the same extent as if this Agreement had not been executed, (ii) the exercise by the Agent or the Banks of any rights under this Agreement or any of the other Loan Documents shall not release Borrower from any of its duties or obligations under the contracts and agreements included in the Collateral, and (iii) neither the Agent nor the Banks shall have any obligation or liability under the contracts and agreements included in the Collateral by reason of this Agreement or any of the other Loan Documents nor shall the Agent or any Bank be obligated to perform any of the obligations or duties of Borrower thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.

SECTION 2.9. AGENT MAY PERFORM. If Borrower fails to perform any agreement contained herein, the Agent may itself perform, or cause performance of, such agreement, and the expenses of the Agent incurred in connection therewith shall be payable by Borrower, together with interest thereon at the rate specified in Section 2.6 of the Loan Agreement, and until so paid shall be deemed part of the Obligations.

SECTION 2.10. AGENT'S DUTIES. The powers conferred on the Agent hereunder are solely to protect its interest and the interests of the Banks and the CP Holders in the Collateral and shall not impose any duty upon it to exercise any such powers except as provided herein. Except for the safe custody of any Collateral in its possession and the accounting for monies actually received by it hereunder and performing its other express duties hereunder, the Agent shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.

ARTICLE III
PRIORITY OF SECURITY INTERESTS

SECTION 3.1. PRIORITY OF SECURITY INTERESTS. Borrower warrants and represents to the Agent and the Banks that, as to those assets for which perfection may be accomplished by filing or by possession under the UCC, the security interests granted to the Agent hereunder constitute and will constitute at all times a valid and perfected security interest vested in the Agent in and upon the Collateral. Borrower further warrants and represents that the Agent's security, interests in the Collateral are not and hereinafter shall not become subordinate or junior to the security interests, liens or claims of any other Person, firm or corporation, including the United States or any department, agency or instrumentality thereof, or any state, county or local governmental agency, except for the Permitted Liens. Borrower shall not grant (without the prior written approval of the Agent) a security interest in or permit a lien or encumbrance upon any of the Collateral to anyone except the Agent as long as any of the Obligations remain unpaid, except for the Permitted Liens. Notwithstanding the priority of any filed financing statement, the Borrower, the Agent acting hereunder for the benefit of the Banks and the Agent acting as agent for the SBA under the SBA Security Agreement acknowledge and agree that the security interest in that part of the Collateral which constitutes the SBA Collateral granted by the Borrower under the SBA Security Agreement is senior and prior in right of distribution to the security interest granted herein for the benefit of the Banks, the CP Holders and the Paying Agent, to the extent and as provided in Section 5.3(a) hereof and in the Intercreditor Agreement.

ARTICLE IV
COLLATERAL

SECTION 4.1. REPRESENTATIONS, COVENANTS AND WARRANTIES. Borrower hereby makes the following representations, warranties and covenants to the Agent and the Banks,

which shall survive the execution and delivery of the Loan Documents and (except to the extent that any of such representations, and warranties and covenants expressly relate to earlier dates) shall be deemed repeated and confirmed as of each date on which any Revolving Credit Loans or Term Loans are requested by Borrower or made by any Bank:

(a) Borrower is now and at all times hereafter shall be the absolute owner, free and clear of all Liens (other than Permitted Liens) except security interests and rights of the Agent and the Banks granted herein, of indefeasible title to all of the Collateral, except for that portion of Borrower's rights and/or obligations under any Loan in which Borrower has granted a participation to any Person in accordance with Section 2.14 of the Loan Agreement;

(b) To the best of Borrower's knowledge, each outstanding Loan does, and each future Loan will, represent a bona fide, valid and legally enforceable indebtedness according to its terms, and each Loan, at the time of creation thereof, except with the consent of the Agent and the Banks, will be subject to no offsets, discounts, counterclaims, contra-accounts or any other defense of any kind or character that materially adversely affects the value of the Loan;

(c) With respect to each outstanding and future Loan, the Agent and the Banks may rely on all statements or representations made by Borrower on or with respect to such Loans delivered hereunder or under the Loan Agreement, and, unless otherwise indicated in writing by Borrower, each outstanding Loan is, and each future Loan will be, genuine and in all respects what it purports to be, and, to Borrower's knowledge, there are no, and, at the time of creation of each Loan there will not be any, to Borrower's knowledge, facts, events or occurrences that would in any way materially impair the validity or enforcement thereof;

(d) All of the outstanding Loans have been, and all future Loans will be, created, and are (or in the case of future Loans, will be), and the form and content of each document related to all outstanding and future Loans, the security related thereto, and the transactions from which it arose comply (or, in the case of future Loans, will comply) in all material respects with any and all applicable laws, ordinances, rules and regulations, Federal, state and/or local, with respect to the extension of credit and charging of interest, including, without limitation, as applicable, the Federal Consumer Credit Protection Act, the Federal Fair Credit Reporting Act, the Federal Trade Commission Act, the Federal Equal Credit Opportunity Act and all Federal, state and local laws related to licensing, usury, truth in lending, real estate settlement procedures, consumer protection, equal credit opportunity, fair debt collection, unfair and deceptive trade practices, rescission rights and disclosures, and with all rules and regulations thereunder, all as amended, and any disclosures required with respect to any Loan the failure of which to make would have a Material Adverse Effect on Borrower were and will continue to be made properly and in a timely manner;

(e) The original amount and unpaid balance of each Loan shown on Borrower's books and records and on any statement or schedule delivered to the Agent are and will be true and correct, and the unpaid balance is and will be the amount actually owing to Borrower;

(f) If requested by the Required Banks at any time or from time to time, Borrower shall cause a Lien search against each Person to whom a Loan has been made satisfactory to the Agent, to be performed and delivered directly to the Agent, which Lien search shall indicate the absence of any Liens against such Person or the property of the Person on which Borrower has a Lien, other than Liens in favor of Borrower which have been assigned to the Agent or the Banks or Liens in favor of the Agent or the Banks and other than Permitted Liens;

(g) Borrower has not extended and will not extend any credit of any kind or in any manner to any Person in connection with the transactions from which the Loans arose or will arise other than as Borrower has indicated on and has had evidenced by, or will indicate or have evidenced by, in the case of future Loans, Borrower's files related to the Loans;

(h) Each security agreement, UCC filing, title retention instrument, and other document and instrument, if any, which is security for the Loans contains, or will contain, in the case of future Loans, a correct and sufficient description of the Underlying Collateral covered thereby and each lien or security interest which secures any outstanding Loan is, or any future Loan will be, valid;

(i) To the best knowledge of Borrower, except as disclosed to the Agent, any and all policies of insurance related to the property securing any obligation of a Person to whom Borrower has made a Loan, or any guarantor of such Loan, in connection with any Loan and any credit life insurance, credit disability insurance, or credit unemployment insurance are in full force and effect in accordance with the terms of all agreements between Borrower and such Person or guarantor;

(j) Borrower has no knowledge of any fact which would impair in any material respect the value or validity of any Loan except as disclosed to the Agent; and

(k) The transactions contemplated herein, including the granting of security interests herein and the enforcement by the Agent of its rights hereunder if a Default or Event of Default occurs, do not and will not affect the validity of the pledges of the Underlying Collateral and the Loans secured by the Underlying Collateral are and will still be valid against the Obligers of such Loans.

(b) With respect to each of the Collections: Borrower shall collect all Collections, receive all payments thereon and immediately deposit the proceeds thereof into a Depository Account. Borrower may withdraw funds from such account to use in the ordinary course of its business.

SECTION 4.3. RIGHTS OF AGENT REGARDING COLLATERAL. Upon the occurrence and during the continuance of an Event of Default, and subject to the provisions of the Intercreditor Agreement, the Agent shall have the right, and upon the direction of the Required Banks shall, at any time and from time to time thereafter, without notice to Borrower, (a) to notify, and upon the direction of the Agent to Borrower, the Borrower will notify, (i) all Persons to whom Borrower has made Loans that the Agent has a security interest in such Collateral and direct all such Persons to make payments to the Agent or its designee, and to such banks and accounts (which may be the Collateral Account) as designated by the Agent or such designee, of all sums owing by them to Borrower, and (ii) all banks in which Borrower has any Depository Accounts of the occurrence of an Event of Default and direct all such Banks to transfer into the Collateral Account, or to such other account at such bank as shall be designated by the Agent or its designee, all amounts on deposit from time to time in the related Depository Accounts; (b) to settle, compromise, sell, assign, extend or renew any debt owing by any Persons to whom Borrower has made a Loan; (c) to sell or assign such Collateral upon such terms as the Agent may deem advisable; and (d) to discharge and release in the name of Borrower and the Agent any such debt. Any and all disbursements for costs and expenses incurred or paid by the Agent with respect to the enforcement, collection or protection of its interest in the Collateral, or against Borrower, whether by suit or otherwise, notification of Persons to whom Borrower has made Loans, including reasonable attorneys' fees actually incurred, court costs and similar expenses, if any, shall become a part of the Obligations secured by the Collateral, payable on demand.

ARTICLE V
DEFAULT

(a) failure of Borrower to observe, perform or comply with any of the terms, provisions, conditions or covenants, or, in any material respect, any warranties or representations, contained in this Agreement other than in Section 4.1 hereof;

(b) failure of Borrower to observe, perform or comply with any of the terms, provisions, conditions, covenants, warranties or representations contained in Section 4.1 of this Agreement, which failure shall not have been remedied within 30 days after such failure shall first have become known to any officer of Borrower;

(c) the occurrence of an Event of Default under the Loan Agreement; or

(d) any of the Loan Documents shall cease to be in full force and effect.

SECTION 5.2. REMEDIES. (a) Upon the occurrence of any Event of Default, the Agent shall have, in addition to any other rights and remedies contained in this Agreement or in any of the Other Agreements, all the rights and remedies of a secured party under the UCC, and all other rights and remedies provided by law, all of which shall be cumulative to the extent permitted by law. Upon the occurrence of any Event of Default and at any time thereafter if such or any other default shall then be continuing, the Agent shall have the right without further notice to Borrower to, and upon the direction of the Required Banks shall, appropriate, take possession and control of, set off and apply to the payment of any or all of the Obligations and/or the CP Debt, any or all Collateral, subject to and in the manner set forth in Section 5.3 and in the Intercreditor Agreement, to enforce payment in connection with the Loans or any other Collateral to settle, compromise or release, in whole or in part, any amounts owing on the Collateral, to prosecute any action, suit or proceeding with respect to the Collateral, to extend the time of payment of any and all Collateral, to make allowances and adjustment with respect thereto, to issue credits in the name of Borrower or the Agent, to sell, assign and deliver the Collateral (or any part thereof), at public or private sale, at broker's board, for cash, upon credit or otherwise, at the Agent's sole option and discretion and the Agent and any Bank or other Person interested in the Obligations may bid or become purchaser at any such sale, if public, free from any right of redemption, which is hereby expressly waived. Borrower agrees that the giving of ten days notice by the Agent, sent by certified mail, return receipt requested postage prepaid, to the address set forth below, designating the place and time of any public sale or of the time after which any private sale or other intended disposition of the Collateral is to be made, shall be deemed to be reasonable notice thereof and Borrower waives any other notice with respect thereto. The net cash proceeds resulting from the exercise of any of the foregoing rights or remedies shall be applied by the Agent in accordance with
Section 5.3 hereof, and the Borrower shall remain liable to the Agent, the Banks and the CP Holders for any deficiency, together with interest thereon at the rate provided in the Loan Agreement with respect to the Obligations and in the Commercial Paper with respect to the CP Debt, and the cost and expenses of collection of such deficiency, including (to the extent permitted by law), without limitation, reasonable attorneys' fees actually incurred, expenses and disbursements.

(b) If at any time or times hereafter the Agent employs counsel for advice with respect to this Agreement or any Other Agreements, or to intervene, file a petition, answer, motion or other pleading in any suit or proceeding relating to this Agreement or any Other Agreements (including, without limitation, the interpretation or administration, or the amendment, waiver or consent with respect to any term, of this Agreement or any Other Agreements), or relating to any Collateral, or to protect, take possession of, or liquidate any Collateral, or to attempt to enforce any security interest or lien in any Collateral, or to represent the Agent in any pending or threatened litigation with respect to the affairs of Borrower in any way relating to any of the Collateral or to the Obligations or to enforce any rights of the Agent,

any Bank or the CP Holders or liabilities of Borrower, any Person to whom Borrower has made a Loan, or any Person which may be obligated to the Agent or such Bank by virtue of this Agreement or any Other Agreement, instrument or document now or hereafter delivered to the Agent, any Bank, any CP Holder or the Paying Agent by or for the benefit of Borrower, then in any of such events, all of the reasonable attorneys' fees actually incurred arising from such services, and any expenses, costs and charges relating thereto, shall be Obligations secured by the Collateral.

(c) Upon the occurrence of an Event of Default, the Agent shall have the right to require Borrower to assemble all Collateral not already in the Agent's possession and make it reasonably available to the Agent at one or more places to be designated by the Agent which are reasonably convenient to both parties, and to take possession of such Collateral and to enter and remain upon the various premises of Borrower without cost or charge to the Agent, and to use the same, together with materials, supplies, books and records of Borrower for the purpose of collecting such Collateral or liquidating such Collateral (plus any Collateral already in the Agent's possession), whether by foreclosure, auction or otherwise. In addition, the Agent may remove from such premises such Collateral, and any records with respect thereto, to the premises of the Agent or any Custodian for such time as the Agent may desire, in order to effectively collect or liquidate such Collateral.

(d) Upon the occurrence of an Event of Default, the Agent shall have the right to, and upon the direction of the Required Banks shall, require Borrower to establish and maintain a lockbox service (which may be the Collateral Account) with such bank or banks as may be acceptable to the Agent. In the event Borrower (or any of its Affiliates, subsidiaries, stockholders, directors, officers, employees or agents) shall receive any monies, checks, notes, drafts or any other items of payment relating to, or proceeds of, the Loan, Borrower agrees with the Agent as follows:

(i) Borrower shall hold all such items of payment in trust for the Agent and the Banks and as the property of Agent and the Banks, separate from the funds of Borrower, and Borrower shall immediately forward, or cause to be forwarded, the same to the lockbox service for application to the Revolving Credit Loans or Term Loans;

(ii) Borrower shall forward to the Agent, on a daily basis, deposit slips related to all such items of payment received by Borrower and, if requested by the Agent, copies of such checks and other items, together with a statement showing the application of that portion of such items of payment relating to payment in connection with the Loans and a collection report with regard thereto in form and substance satisfactory to the Agent;

(iii) All such items of payment shall be the sole and exclusive property of the Agent for the benefit of the Banks immediately upon the earlier of receipt of such items by the Agent or the receipt of such items by Borrower;

(iv) The lockbox service shall be subject to the sole control of the Agent and the Agent shall have the right at all times in its sole discretion to apply all or part of such items of payment to the payment in accordance with Section 5.3 hereof. The Agent may, and upon the direction of the Required Banks shall, release to Borrower all or any part of such items of payment; and

(v) The Agent assumes no responsibility for such lockbox arrangement, including, without limitation, any claim of accord and satisfaction or release with respect to deposits accepted by any bank thereunder.

(e) To the extent that the Agent, acting as Agent hereunder, exercises any rights or omits to exercise any rights under this Agreement at any time for the benefit of the Banks (whether requested by the Required Banks thereunder or otherwise) with respect to any of the Collateral, such exercise or omission shall likewise be deemed to be authorized by the CP Holders for performance (or omission) by the Agent hereunder for the benefit of the CP Holders. In furtherance of the foregoing, the Agent may exercise (or omit to exercise) all rights requested by the Required Banks under this Agreement without first giving notice to or consulting with any CP Holder or the Paying Agent acting with respect to any Commercial Paper.

SECTION 5.3. APPLICATION OF PROCEEDS. (a) The proceeds of any lockbox collection or sale of, or other realization upon, all or any part of the Collateral shall be applied by the Agent in the following order of priority:

first, to payment of the expenses of such lockbox or sale or other realization, including reasonable compensation to the Agent and its agents and counsel and all expenses, liabilities, advances incurred or made by the Agent in connection therewith, and any other unreimbursed expenses for which the Agent is to be reimbursed under this Agreement;

second, (i) with respect to the realization upon SBA Collateral, first to the payment of the SBA Secured Debt (including principal, interest, fees and all other amounts due thereunder), and after payment in full of the SBA Secured Debt, to the payment of the CP Debt (to the extent that it constitutes Permitted Debt) and the Obligations, pro rata in accordance with the respective outstanding balances thereof (including principal, interest, fees and all other amounts due thereunder) and (ii) with respect to all other Collateral, to the payment of the CP Debt (to the extent that it constitutes Permitted Debt) and the Obligations, pro rata in accordance with the respective outstanding balances thereof (including principal, interest, fees and all other amounts due thereunder); and

third, after indefeasible payment in full of all Obligations and all CP Debt, to payment to Borrower or its successors and assigns, or as a court of competent jurisdiction may direct, of any surplus then remaining from such proceeds.

The Agent may make distributions hereunder in cash or in kind, but such distributions to the Banks shall in all events be made pro rata on the basis of the respective Exposure Percentages of the Obligations. Distributions made under clause "second" above may also be made in a combination of cash or property, but distributions to the Banks shall be made pro rata on the basis of the respective Exposure Percentages of the Obligations. Distributions made under clauses "first" and "third" may also be made in a combination of cash or property. Any deficiency remaining, after application of such cash or cash proceeds to the Obligations, shall continue to be Obligations for which Borrower remains liable.

(b) In making the determinations and allocations required by this Section 5.3, the Agent may rely upon information supplied by the Banks as to the amounts of the Obligations held by them, upon information supplied by the Paying Agent as to the amounts owed on the CP Debt, and upon information supplied by the SBA as to the amounts owed on the SBA Secured Debt, and the Agent shall have no liability to any of the Banks, the CP Holders or the Paying Agent for actions taken in reliance upon such information. All distributions made by the Agent pursuant to this Section 5.3 shall be final, and the Agent shall have no duty to inquire as to the application by the Banks, the CP Holders, the Paying Agent or the SBA of any amount distributed to them. However, if at any time the Agent determines that an allocation was based upon a mistake of fact (including without limitation, mistakes based on an assumption that principal or interest or any other amount has been paid by payments that are subsequently recovered from the recipient thereof through the operation of any bankruptcy, reorganization, insolvency or other laws or otherwise), the Agent may in its discretion, but shall not, subject to Section 5.3(c), be obligated to, adjust subsequent allocations and distributions hereunder so that, on a cumulative basis, the Banks, the CP Holders and the SBA receive the distributions to which they would have been entitled if such mistake of fact had not been made.

(c) If, through the operation of any bankruptcy, reorganization, insolvency or other laws or otherwise, the security interests created hereby are enforced with respect to some, but not all, of the Obligations, the CP Debt and the SBA Secured Debt, the Agent shall nonetheless apply the proceeds for the benefit of the Banks, the CP Holders and the SBA, in the proportion and subject to the priorities of Section 5.3(a). To the extent that the Agent distributes proceeds collected with respect to one Obligation to or on behalf of the holder of another Obligation or a Bank obtains the equivalent of proceeds through the exercise of any right of setoff, the holder of the former Obligation shall be deemed to have purchased a participation in the latter Obligation or shall be subrogated to the rights of the holder thereof to receive any subsequent payments and distributions made with respect to the portion thereof paid or to be paid by the application of such proceeds.

SECTION 5.4. WAIVER BY AGENT OR BANKS. The Agent's or any Bank's failure at any time or times hereafter to require strict performance by Borrower of any of the provisions, warranties, terms and conditions contained in this Agreement or any of the Other Agreements shall not waive, affect or diminish any right of the Agent or any Bank at any time or times hereafter to demand strict performance therewith and with respect to any other provisions, warranties, terms and conditions contained in this Agreement or any of the Other Agreements, and any waiver of any Event of Default shall not waive or affect any other Event of Default, whether prior or subsequent thereto, and whether of the same or a different type. None of the warranties, conditions, provisions and terms contained in this Agreement or any Other Agreement shall be deemed to have been waived by any act or knowledge of the Agent or any Bank, or their respective agents, officers or employees except by an instrument in writing signed by an officer of the Agent or such Bank and directed to Borrower specifying such waiver.

ARTICLE VI
MISCELLANEOUS

SECTION 6.2. WAIVERS BY BORROWER. (a) Borrower irrevocably waives the right to direct the application of any and all payments which may be received by the Agent during the continuance of an Event of Default, and Borrower does hereby irrevocably agree that, during the continuance of an Event of Default, the Agent shall have the continuing exclusive right to apply and reapply any and all such payments received in such manner as the Agent may deem advisable, notwithstanding any entry upon any of its books and records.

(b) Borrower also waives any and all notices of demand, notice or protest that Borrower might be entitled to receive with respect to this Agreement by virtue of any applicable statute or law, and waives demand, protest, notice of protest, notice of default, release, compromise, settlement, extension or renewal of all commercial paper, accounts, contract rights, instruments, guaranties, and otherwise, at any time held by the Agent or the Banks on which Borrower may in any way be liable, notice of nonpayment at maturity of any and all Loans, and notice of any action taken by the Agent or the Banks unless expressly required by this Agreement.

SECTION 6.3. PARTIES. This Agreement and any of the Other Agreements, instruments and documents executed and delivered pursuant hereto or to consummate the transactions contemplated hereunder shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto.

SECTION 6.4. GOVERNING LAW. THIS AGREEMENT AND ANY OTHER AGREEMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE LAWS OF ANOTHER JURISDICTION ARE MANDATORILY APPLICABLE TO THE EXERCISE OF REMEDIES OR THE PERFECTION OF SECURITY INTERESTS UNDER THE UCC.

SECTION 6.5. WAIVER OF JURY TRIAL AND SETOFF. EACH OF BORROWER AND THE AGENT HEREBY WAIVES TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT, THE OTHER AGREEMENTS OR ANY INSTRUMENT OR DOCUMENT DELIVERED PURSUANT TO THIS AGREEMENT OR THE OTHER AGREEMENTS, OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF, OR ANY OTHER CLAIM OR DISPUTE, HOWSOEVER ARISING, BETWEEN BORROWER AND ANY OF THE BANKS OR THE AGENT, BETWEEN ANY BANKS, BETWEEN THE AGENT AND ANY BANKS, BETWEEN THE AGENT AND ANY CP HOLDER OR THE PAYING AGENT, BETWEEN ANY CP HOLDER AND THE PAYING AGENT AND BETWEEN ANY CP HOLDERS AND BORROWER HEREBY WAIVES THE RIGHT TO INTERPOSE ANY SETOFF, COUNTERCLAIM OR CROSS-CLAIM IN CONNECTION WITH ANY SUCH LITIGATION, IRRESPECTIVE OF THE NATURE OF SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM (UNLESS SUCH SETOFF, COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION).

SECTION 6.6. JURISDICTION; SERVICE OF PROCESS. Borrower hereby irrevocably consents to the Jurisdiction of the Courts of the State of New York, County of New York and of any Federal Court located in the Southern District of New York, and agrees that venue in each of such Courts is proper in connection with any action or proceeding arising out of or relating to this Agreement, the Other Agreements, or any document or instrument delivered pursuant to this Agreement or the Other Agreements. Nothing herein shall affect the right of any Bank to serve process in any other manner permitted by law or to commence legal proceedings or otherwise proceed against Borrower in any other jurisdiction.

SECTION 6.7. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and warranties of Borrower and all terms, provisions, conditions and agreements to be performed by Borrower contained in this Agreement and in the other Loan Documents shall be true and correct, and satisfied, where applicable, at the time of the execution of this Agreement, and shall survive the execution and delivery of this Agreement and all Other Agreements.

SECTION 6.8. OBLIGATIONS SECURED BY PROPERTY OTHER THAN COLLATERAL. To the extent that the Obligations are now or hereafter secured by property other than the Collateral, or by a guarantee, endorsement or property of any other Person, then the Agent shall have the right to, and upon the direction of the Required Banks shall, proceed against such other property, guarantee or endorsement upon the occurrence and during the continuance of an Event of Default, and the Agent shall have the right, with the consent of the Required Banks, to determine which rights, security, liens, security interests or remedies the Agent shall at any time pursue, relinquish, subordinate, modify or take any other action with respect thereto, without in any way modifying or affecting any of them or any of the Agent's rights or any of the Bank's rights under the Obligations, this Agreement or any Other Agreements.

SECTION 6.10. TERMINATION. This Agreement and the security interest in the Collateral created hereby will terminate when the Obligations and the CP Debt have been irrevocably paid and finally discharged in full in accordance with the terms of the Loan Agreement or the documents evidencing the CP Debt, as the case may be, the Banks are no longer obligated to make Revolving Credit Loans or Term Loans under the Loan Agreement, and the Dealer is no longer required to sell Commercial Paper. No waiver by the Agent or any Bank or any other holder of the Revolving Credit Notes or the Term Notes or any CP Holder or the Paying Agent of any default will be effective unless in writing nor operate as a waiver of any other default or of the same default on a future occasion. In the event of a sale or assignment by any Bank (including the Agent in its capacity as a Bank but not as Agent) of a Revolving Credit Note(s) or a Term Note(s) or any portion thereof, such Bank may assign or transfer its rights and interest under this Agreement in whole or in part to the purchaser or purchasers of the Revolving Credit Note(s) or Term Note(s), whereupon such purchaser or purchasers will become vested with all of the powers, rights and responsibilities of such Bank hereunder, and such Bank will thereafter be forever released and fully discharged from any liability or responsibility hereunder with respect to the rights, interest and responsibilities so assigned, other than liabilities arising out of actions taken prior to the date of assignment. Borrower may not assign this Agreement without the express written consent of the Agent and the Banks.

SECTION 6.11. NOTICES. All notices, requests, consents, demands or other communications provided for herein shall be given in accordance with the terms of Section 10.4 of the Loan Agreement.

SECTION 6.12. SEVERABILITY. To the extent any provision of this Agreement is prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

SECTION 6.13. COUNTERPARTS. This Agreement may be executed by the parties hereto in counterparts, each of which shall be an original and both of which shall together constitute one and the same agreement.

IN WITNESS WHEREOF, this Agreement has been executed as of the day and year first above written by the duly authorized officers of the parties hereto.

MEDALLION FUNDING CORP.

By: /s/ Alvin Murstein
   --------------------------------
Name:  Alvin Murstein
Title: Chief Executive Officer



By: /s/ Daniel F. Baker
   --------------------------------
Name:  Daniel F. Baker
Title: Treasurer and
          Chief Financial Officer

FLEET BANK, N.A.,
as Agent

By: /s/ Andrea H. Lee
   ---------------------------------
Name:  Andrea H. Lee
Title: Vice President

EXHIBIT 10.62

First Amendment, dated as of February 5, 1998, to Amended and Restated Loan Agreement by and among Medallion Funding Corp., the leaders party thereto, Fleet Bank, National Association as Swing Line Lender, Administrative Agent and Collateral Agent and The Bank of New York as Documentation Agent with Fleet Bank, National Association as Arranger.

First Amendment entered into as of February 5, 1998, among MEDALLION FUNDING CORP., a New York corporation ("Borrower"), the banks that are signatories hereto, collectively, the "Banks" and individually, a "Bank"), FLEET BANK, NATIONAL ASSOCIATION , as a Bank ("Fleet"), as swing line lender (the "Swing Line Lender"), as Arranger and as Administrative Agent and Collateral Agent for the Banks (including any successor, the "Agent") and The Bank of New York, as a Bank ("BONY") and as Documentation Agent for the Banks (including any successor, the "Documentation Agent").

WHEREAS, the Borrower, the Banks, the Agent and the Documentation Agent are parties to an Amended and Restated Loan Agreement dated as of December 24, 1997 (the "Agreement"); and

WHEREAS, the Borrower has requested that the Banks and the Agent amend, and the Banks and the Agent have agreed to amend, certain provisions of the Agreement.

NOW, THEREFORE, the parties hereto hereby agree as follows:

1. The Agreement is hereby amended as follows:

(a) The definition of "Commercial Loans" contained in Section 1.1 of the Agreement is amended to read in its entirety as follows:

(b) The definition of "Eligible Commercial Loans" contained in Section 1.1 of the Agreement is amended to read in its entirety as follows:

(c) New definitions of "Eligible Equipment" and "Eligible Inventory" shall be added to Section 1.1 of the Agreement immediately after the definition of "Eligible Commercial Loan" to read in their entirety as follows:

(d) A new definition of "Eligible Receivables" shall be added to
Section 1.1 of the Agreement immediately after the definition of "Eligible Real Estate" to read in its entirety as follows:

(iv) in which a first priority perfected security interest has been obtained by Borrower to secure the obligations of such Person under a Loan by Borrower to such Person, or in the case of such beneficial owner, to secure a guaranty which shall have been made by such beneficial owner guaranteeing the Loan, and the same has been assigned to the Agent, for the benefit of the Banks, pursuant to the Security Agreement.

(e) A new definition of "Inventory shall be added to Section 1.1 of the Agreement immediately after the definition of "Interest Period" to read in its entirety as follows:

(f) The definition of "Loans" contained in Section 1.1 of the Agreement is amended to read in its entirety as follows:

(g) A new definition of "Receivables" shall be added to Section 1.1 of the Agreement immediately after the definition of "Real Property" to read in its entirety as follows:

(h) The definition of "Investment" contained in Section 1.1 of the Agreement is amended to read in its entirety as follows:

(i) The definition of "Portfolio Purchase" contained in Section 1.1 of the Agreement is amended to read in its entirety as follows:

(j) A new definition of "Super-majority Banks" shall be added to
Section 1.1 of the Agreement immediately after the definition of "Subsidiary" to read in its entirety as follows:

equal to or in excess of 75% of the sum of the Aggregate Revolving Credit Commitment plus all Term Loans then outstanding.

(k) Section 5.2(c) is amended to read in its entirety as follows:

(c) no event, action or condition has occurred that would adversely affect the validity or enforceability of, or the authority of the Borrower to perform its obligations under, any of the Loan Documents to which it is a party.

(l) Section 6.15 is amended to read in its entirety as follows:

Borrower shall ensure that, for so long as any amounts are owed by it to the Banks, the Swing Line Lender or the Agent under the Loan Documents, at all times at least 65% of the aggregate principal amount of all Loans then outstanding shall be Eligible Medallion Loans to Persons who have obtained such Loans for the purpose of acquiring Medallion Rights for use primarily in New York City. For purposes of this Section 6.15, Loans shall include all Loans acquired in connection with Portfolio Purchases permitted pursuant to this Agreement.

(m) Section 8.3(a) is amended to read in its entirety as follows:

(a) Make, or obligate itself to make, any loan or advance or Investment that is not a Domestic Loan or a Domestic Investment.

(n) A new Section 8.16 is added immediately after Section 8.15 to read in its entirety as follows:

Make, or obligate itself to make, any Portfolio Purchase unless:

(i) no Default or Event of Default exists or would exist after giving effect to the applicable Portfolio Purchase;

(ii) the Borrower has provided the Agent and each of the Banks with a pro forma certificate of the chief financial officer of the Borrower evidencing the Borrower's computation of compliance with each of the financial ratios, tests or covenants specified in Article VII, 6.15, 8.2, 8.3, 8.4 and 8.14 hereof after giving effect to the applicable Portfolio Purchase;

(iii) the applicable Portfolio Purchase has the approval of the seller;

(A) if the consideration for such Portfolio Purchase shall be Capital Stock of the Borrower, the fair market value of such Capital Stock, less the aggregate outstanding principal balances of all loans included in such Portfolio Purchase that are secured by New York City taxicab medallions, if any, shall not exceed $50,000,000 with respect to any one such Portfolio Purchase or $100,000,000 in any fiscal year with respect to all such Portfolio Purchases in the aggregate in such fiscal year; and

(B) if the consideration for such Portfolio Purchase shall be other than Capital Stock of the Borrower, the consideration therefor, less the aggregate outstanding principal balances of all loans included in such Portfolio Purchase that are secured by New York City taxicab medallions, if any, shall not exceed $25,000,000 with respect to any one such Portfolio Purchase or $50,000,000 in any fiscal year with respect to all such Portfolio Purchases in the aggregate in such fiscal year.

(o) Section 9.1(e) is amended to read in its entirety as follows:

(p) Section 9.1(f) is amended to read in its entirety as follows:

(f) if Borrower shall (i) default in the payment of any principal, interest or premium with respect to any Indebtedness for borrowed money or any obligation which is the substantive equivalent thereof in excess of $50,000, other than Indebtedness under the Revolving Credit Loans, the Swing Line Loans, the Term Loans, or the CP Debt, and such default shall continue for more than the period of grace, if any, therein specified or (ii) default in the performance or observance of any other term, condition or agreement contained in any such obligation or in any agreement relating thereto if the effect thereof is to cause, or permit the holder or holders of such obligation (or a trustee on behalf of such holder or holders) to cause, such obligation to become due prior to its stated maturity;

(q) Section 9.1(l) is amended to read in its entirety as follows:

(1) if there shall occur any change in the Collateral or in the business of Borrower, or its operation, conduct or prospects thereof, that individually or in the aggregate, could have or result in a Material Adverse Effect and the Agent has been directed to declare such Event of Default by the Super-majority Banks as set forth below in this Section 9.1; or

(r) The paragraph beginning with the word "then" immediately following
Section 9.1(m) is amended to read in its entirety as follows:

then, (A) in the case of an Event of Default described in clause (h) or (i) above, the Aggregate Revolving Credit Commitment, the Swing Line Commitment, and each Term Loan Commitment shall automatically terminate and
(i) the unpaid balance of the Revolving Credit Notes, the Swing Line Note, the Term Notes and all interest accrued thereon, and (ii) any accrued and unpaid fees and expenses due and payable hereunder or under any other Loan Document shall automatically (without any action on the part of the Agent or the Banks and without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived) forthwith become due and payable, and, (B) in the case of an Event of Default described in clause
(l) above, at any time thereafter, if such Event of Default shall then be continuing the following action may be taken: The Agent, upon the direction of the Super-majority Banks, shall, declare (i) the Aggregate Revolving Credit Commitment, the Swing Line Commitment and all Term Loan Commitments to be terminated, whereupon the obligation of the Agent the Banks and the Swing Line Lender to make further Revolving Credit Loans or Term Loans or Swing Line Loans, as the case may be, hereunder shall terminate immediately and (ii) the Revolving Credit Notes, Swing Line Note and Term Notes to be due and payable, whereupon the maturity of the then unpaid balance of the Revolving Credit Notes, Swing Line Note and Term Notes shall be accelerated and the same, and all interest accrued thereon and any accrued and unpaid fees and expenses due and payable hereunder, shall forthwith become due and payable without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived, anything contained herein or in Revolving Credit Notes, Swing Line Note or Term Notes to the contrary notwithstanding, and, (C) in the case of any other Event of Default, then and in any such event, and at any time thereafter, if such or any other Event of Default shall then be continuing the

following action may be taken: the Agent may (but shall not be obligated to), and upon the direction of the Required Banks shall, declare (i) the Aggregate Revolving Credit Commitment, the Swing Line Commitment and all Term Loan Commitments to be terminated, whereupon the obligation of the Agent the Banks and the Swing Line Lender to make further Revolving Credit Loans or Term Loans or Swing Line Loans, as the case may be, hereunder shall terminate immediately and (ii) the Revolving Credit Notes, Swing Line Note and Term Notes to be due and payable, whereupon the maturity of the then unpaid balance of the Revolving Credit Notes, Swing Line Note and Term Notes shall be accelerated and the same, and all

interest accrued thereon and any accrued and unpaid fees and expenses due and payable hereunder, shall forthwith become due and payable without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived, anything contained herein or in Revolving Credit Notes, Swing Line Note or Term Notes to the contrary notwithstanding.

2. The Borrower hereby represents and warrants to the Agent and each Bank that:

(a) Each and every of the representations and warranties set forth in the Agreement is true as of the date hereof and with the same effect as though made on the date hereof, and is hereby incorporated herein in full by reference as if fully restated herein in its entirety.

(b) No Default or Event of Default and no event or condition which, with the giving of notice or lapse of time or both, would constitute such a Default or Event of Default, now exists or would exist.

3. All capitalized terms used herein, unless otherwise defined herein, have the same meanings provided therefor in the Agreement.

4. The amendments set forth herein are limited precisely as written and shall not be deemed to (a) be a consent to or a waiver of any other term or condition of the Agreement or any of the documents referred to therein or (b) prejudice any right or rights which the Agent or any Bank may now have or may have in the future under or in connection with the Agreement or any documents referred to therein. Whenever the Agreement is referred to in the Agreement or any of the instruments, agreements or other documents or papers executed and delivered in connection therewith, it shall be deemed to mean the Agreement as modified by this First Amendment.

5. This Amendment Number One shall be effective as of the date first above written provided that the Borrower and

the Agent shall have received counterparts of this Amendment Number One duly signed by the Borrower and each of the Banks. Promptly after the effective date of this Amendment Number One, the Agent shall deliver fully executed counterparts of this Amendment to each of the Banks, and the Agreement shall consist of the Agreement as amended by this Amendment Number One.

[BALANCE OF PAGE INTENTIONALLY LEFT BLANK. SIGNATURES
CONTINUED ON THE FOLLOWING PAGES BEGINNING WITH PAGE 7]

IN WITNESS WHEREOF, Borrower, the Agent, the Documentation Agent, the Swing Line Lender and the Banks have caused this Agreement to be duly executed by their respective officers hereunto duly authorized as of the day and year first above written.

MEDALLION FUNDING CORP.

By: /s/ Alvin Murstein
    --------------------------
Name:  Alvin Murstein
Title: Chief Executive Officer


By: /s/ Daniel F. Baker
    --------------------------
Name:  Daniel F. Baker
Title: Treasurer and Chief
       Financial Officer

FLEET BANK, NATIONAL ASSOCIATION, as
Agent, as Swing Line Lender and as one of the Banks

By: /s/ Andrea Lee
    --------------------------
    Title: Vice President
    Payment Office:
      1185 Avenue of the Americas
      New York, New York 10036

THE BANK OF NEW YORK,
as Documentation Agent
and as one of the Banks

By: /s/ Scott Silverstein
    -----------------------
    Title:  Vice President

BANKBOSTON, N.A.

By: /s/ Jack Bender
    ------------------------
    Title:  Director

HARRIS TRUST AND SAVINGS BANK

By: /s/ Michael Houlihan
    ------------------------
    Title:  Vice President

BANK TOKYO - MITSUBISHI TRUST COMPANY

By: /s/ James Brown
    ------------------------
    Title:  Vice President

ISRAEL DISCOUNT BANK OF NEW YORK

By: /s/ Jerry Grossman
    -----------------------------
    Title:  Senior Vice President


By: /s/ Maureen McKee
    ------------------------
    Title: Vice President

EUROPEAN AMERICAN BANK

By: /s/ Dennis Nochowitz
    ------------------------
    Title: Vice President

BANK LEUMI USA

By: /s/ Paul Tine
    ----------------------------
    Title: Vice President



By: /s/ Rich Silverstein
    ----------------------------
    Title: Senior Vice President

THE CHASE MANHATTAN BANK

By: /s/ William Saya
    ------------------------
    Title: Vice President

EXHIBIT 10.63

AMENDMENT NO. 1 TO AMENDED AND RESTATED SECURITY AGREEMENT

AGREEMENT, made as of March 12, 1998, by and between MEDALLION FUNDING CORP., a New York corporation, (the "Borrower"); and FLEET BANK, N.A., a national banking association (the "Agent"), as Agent for the Banks that from time to time are parties to the Loan Agreement referred to in the Amended and Restated Security Agreement hereinafter described and for the Holders of Commercial Paper therein referred to.

WHEREAS:

(A) The Borrower and the Agent are parties to an Amended and Restated Security Agreement dated as of December 24, 1997 (the "Security Agreement");

(B) The Borrower and the Bank wish to amend the Security Agreement as set forth herein (this Agreement is hereinafter referred to as "Amendment No. 1");

(C) Any capitalized terms not defined herein shall have the meanings ascribed thereto in the Security Agreement;

NOW, THEREFORE, the parties hereto hereby agree as follows:

This Amendment shall be deemed to be an amendment to the Security Agreement and shall not be construed in any way as a replacement or substitution therefor. All of the terms and provisions of this Amendment are hereby incorporated by reference into the Security Agreement as if such terms and provisions were set forth in full therein.

(a) The Recitals Section of the Security Agreement which appears at the beginning thereof is hereby amended to Amendment No. 1, dated as of March 12, 1998, to Amended and Restated Security Agreement between Medallion Funding Corp. and Fleet Bank, N.A.

the extent that the seventh "WHEREAS" clause is amended to read in its entirety as follows:

"WHEREAS, the Banks are willing to consent to the grant of the security interest in the Collateral to the Agent for the benefit of the CP Holders and to the grant of the security interest in the SBA Collateral to the Agent for the benefit of the SBA pursuant to the SBA Security Agreement, provided that the Security Agreement is amended in accordance herewith and provided, further that in the case of the CP Holders such security interest granted to the Agent for their benefit shall not be effective unless and until (i) the Agent has been appointed the Agent of the CP Holders for purposes of this Agreement with duties consistent with those necessary for the Agent (in its opinion) to perform its duties under this Agreement, (ii) the CP Holders shall have been deemed to have consented to the Agent's entering into the Intercreditor Agreement on their behalf and (iii) the CP Holders shall have been deemed to agree that the Agent is not liable to the CP Holders other then for gross negligence or willful misconduct."

(b) Section 1.1 of the Security Agreement is hereby amended by deleting the term "Percentage of the Obligations" in its entirety.

(c) Section 5.2 of the Security Agreement is hereby amended to the extent that subsection 5.2(a) and the first paragraph of subsection 5.2(d) are each hereby amended to read in their entirety as follows:

"(a) Upon the occurrence of any Event of Default, the Agent shall have, in addition to any other rights and remedies contained in this Agreement or in any of the Other Agreements, all the rights and remedies of a secured party under the UCC, and all other rights and remedies provided by law, all of which shall be cumulative to the extent permitted by law. Upon the occurrence of any Event of Default and at any time thereafter if such or any other default shall then be continuing, the Agent shall have the right without

further notice to Borrower to and shall, (i) upon the direction of the Required Banks or (ii) 10 Business Days after written notice from the Paying Agent that the CP Debt was not paid when due (and to the Agent's actual knowledge such CP Debt then remains unpaid), appropriate, take possession and control of, set off and apply to the payment of any or all of the Obligations and/or the CP Debt, any or all Collateral, subject to and in the manner set forth in Section 5.3 and in the Intercreditor Agreement, to enforce payment in connection with the Loans or any other Collateral to settle, compromise or release, in whole or in part, any amounts owing on the Collateral, to prosecute any action, suit or proceeding with respect to the Collateral, to extend the time of payment of any and all Collateral, to make allowances and adjustment with respect thereto, to issue credits in the name of Borrower or the Agent, to sell, assign and deliver the Collateral (or any part thereof), at public or private sale, at broker's board, for cash, upon credit or otherwise, at the Agent's sole option and discretion and the Agent and any Bank or other Person interested in the Obligations may bid or become purchaser at any such sale, if public, free from any right of redemption, which is hereby expressly waived. Borrower agrees that the giving of ten days notice by the Agent, sent by certified mail, return receipt requested postage prepaid, to the address set forth below, designating the place and time of any public sale or of the time after which any private sale or other intended disposition of the Collateral is to be made, shall be deemed to be reasonable notice thereof and Borrower waives any other notice with respect thereto. The net cash proceeds resulting from the exercise of any of the foregoing rights or remedies shall be applied by the Agent in accordance with Section 5.3 hereof, and the Borrower shall remain liable to the Agent, the Banks and the CP Holders for any deficiency, together with interest thereon at the rate provided in the Loan Agreement with respect to the Obligations and in the Commercial Paper with respect to the CP Debt, and the cost and expenses of collection of such deficiency, including (to the extent permitted by law), without

limitation, reasonable attorneys' fees actually incurred, expenses and disbursements.

(d) Upon the occurrence of an Event of Default, the Agent shall have the right to and shall (i) upon the direction of the Required Banks, or
(ii) 10 Business Days after written notice from the Paying Agent that the CP Debt was not paid when due (and to the Agent's actual knowledge such CP Debt then remains unpaid) require Borrower to establish and maintain a lockbox service (which may be the Collateral Account) with such bank or banks as may be acceptable to the Agent. In the event Borrower (or any of its Affiliates, subsidiaries, stockholders, directors, officers, employees or agents) shall receive any monies, checks, notes, drafts or any other items of payment relating to, or proceeds of, the Loan, Borrower agrees with the Agent as follows:"

The Borrower hereby represents and warrants to the Bank that, other than with respect to the reporting requirements set forth in Section 6.1 of the Loan Agreement which are incorrect solely by reason of the Borrower's fiscal year end date being December 31 and not March 31 as referred to therein:

(a) Each and Every of the representations and warranties set forth in Article IV of the Security Agreement is true as of the date hereof with respect to the Borrower and with the same effect as though made on the date hereof, and is hereby incorporated herein in full by reference as if fully restated herein in its entirety.

(b) No Default or Event of Default now exists.

(c) This Amendment No. 1 and any other documents, agreements or instruments now or hereafter executed and delivered to the Agent by the Borrower in connection herewith constitute (or shall, when delivered, constitute) valid and

legally binding obligations of Borrower, each of which is and shall be enforceable against Borrower in accordance with their respective terms.

(d) No consent, waiver or approval of any entity is or will be required in connection with the execution, delivery, performance, validity or enforcement or priority of this Amendment No. 1 or any other agreements, instruments or documents to be executed and/or delivered in connection herewith or pursuant hereto.

IN WITNESS WHEREOF, each of the undersigned has executed or caused to be duly executed this Amendment No. 1 as of the date first above written.

MEDALLION FUNDING CORP.

By: /s/ Daniel F. Baker
    ----------------------

FLEET BANK, N.A., as Agent

By: /s/ Andrea Lee
    ----------------------

Loan Number              Borrower           Outstanding Balance
-----------              --------           -------------------



                                         $________________

Total Outstanding Balance $________________

EXHIBIT 10.64

INDENTURE OF LEASE, DATED October 31, 1997,

BY AND BETWEEN

SAGE REALTY CORPORATION, AS AGENT AND

LANDLORD

and

MEDALLION FINANCIAL CORP.

AS TENANT

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----
Article



ARTICLE 1.     DEFINITIONS, TERM.............................................  1

ARTICLE 2.     COMMENCEMENT OF TERM..........................................  2

ARTICLE 3.     FIXED RENT, ADDITIONAL RENTS AND RENT ADJUSTMENTS.............  3

ARTICLE 4.     ELECTRICITY...................................................  8

ARTICLE 5.     USE........................................................... 11

ARTICLE 6.     REPAIRS, ALTERATIONS AND LIENS................................ 12

ARTICLE 7.     FLOOR LOAD, NOISE, WINDOW CLEANING............................ 17

ARTICLE 8.     LAWS, ORDINANCES, REQUIREMENTS OF PUBLIC
                AUTHORITIES.................................................. 18

ARTICLE 9.     INSURANCE, PROPERTY LOSS, REIMBURSEMENT....................... 19

ARTICLE 10.    DAMAGE OR DESTRUCTION BY FIRE OR OTHER CAUSE.................. 22

ARTICLE 11.    ASSIGNMENT, SUBLETTING, MORTGAGING............................ 24

ARTICLE 12.    NO LIABILITY ON LANDLORD...................................... 31

ARTICLE 13.    MOVING OF HEAVY EQUIPMENT..................................... 32

ARTICLE 14.    CONDEMNATION.................................................. 32

ARTICLE 15.    ENTRY, RIGHT TO CHANGE PUBLIC PORTIONS OF
                THE BUILDING................................................. 33

ARTICLE 16.    BANKRUPTCY.................................................... 34

ARTICLE 17.    DEFAULTS AND REMEDIES AND WAIVER OF REDEMPTION................ 36

ARTICLE 18.    LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS.............. 39

ARTICLE 19.    COVENANT OF QUIET ENJOYMENT................................... 40

ARTICLE 20.    EXCAVATION.................................................... 40

ARTICLE 21.    SERVICES AND EQUIPMENT........................................ 40

ARTICLE 22.    DEFINITION OF LANDLORD........................................ 45

ARTICLE 23.    INVALIDITY OF ANY PROVISION................................... 45

                                     - i -

ARTICLE 24.    BROKER........................................................ 45

ARTICLE 25.    SUBORDINATION................................................. 46

ARTICLE 26.    ESTOPPEL CERTIFICATE.......................................... 48

ARTICLE 27.    LEGAL PROCEEDINGS; WAIVER OF JURY TRIAL....................... 48

ARTICLE 28.    SURRENDER OF PREMISES......................................... 50

ARTICLE 29.    RULES AND REGULATIONS......................................... 51

ARTICLE 30.    NOTICES....................................................... 52

ARTICLE 31.    NO WAIVER; ENTIRE AGREEMENT................................... 52

ARTICLE 32.    CAPTIONS...................................................... 53

ARTICLE 33.    INABILITY TO PERFORM.......................................... 53

ARTICLE 34.    NO REPRESENTATION BY LANDLORD................................. 54

ARTICLE 35.    NAME OF BUILDING.............................................. 54

ARTICLE 36.    SUCCESSORS AND ASSIGNS........................................ 54

ARTICLE 37.    DEFERRED COLLECTIONS.......................................... 55

ARTICLE 38.    ERISA - "PROHIBITED TRANSACTIONS"............................. 55

ARTICLE 39.    FEES/INTEREST/LATE CHARGES.................................... 56

ARTICLE 40.    ABATEMENT OF RENT............................................. 56

ARTICLE 41.    TENANT'S EXPANSION OPTION..................................... 57

ARTICLE 42.    TENANT'S EXTENSION OPTION..................................... 61


Schedule A     Floor Plan
Schedule B     Intentionally Omitted
Schedule C     Rules and Regulations
Schedule D     Schedule of Building Holidays
Schedule E     Cleaning Specifications
Schedule F     Alternate Article 4

INDENTURE OF LEASE made as of this _____ day of October, 1997, between SAGE REALTY CORPORATION, a New York corporation, having its principal office at 777 Third Avenue, New York, New York 10017, Agent for Madison Avenue Leasehold LLC the owner of the Building hereinafter mentioned (herein "Landlord"), and MEDALLION FINANCIAL CORP., a Delaware corporation, having its office at 205 East 42nd Street, New York, New York 10017 (herein "Tenant").

W I T N E S S E T H:

ARTICLE 1.

Section 1.01. The terms defined in this Article shall, for all purposes of this Lease and all agreements supplemental thereto, have the meanings herein specified unless the context otherwise requires.

(a) "Building" shall mean the office building known as 437 Madison Avenue, in the Borough of Manhattan, City and State of New York. The plot of land on which the Building is erected is hereinafter called the "Land."

(b) "Business Days" shall mean all days excluding Saturdays, Sundays and days observed by the State of New York or Federal Government as legal holidays, and further excluding holidays established by any union contract applicable to employees at the Building. A Schedule of holidays for calendar year 1998 is attached hereto as Schedule D.

(c) "Commencement Date" shall have the meaning set forth in
Section 2.02.

(d) "Demised Premises" shall mean the entire

thirty-eighth (38th) floor of the Building, as shown on the Floor Plan annexed hereto as Schedule A and made a part of this Lease, including all fixtures and equipment (including the existing supplemental air-conditioning systems) which at the Commencement Date or during the Term of this Lease are attached thereto and which become a part thereof.

(e) "Expiration Date" shall mean June 30, 2006, or any earlier date of termination pursuant to the provisions hereof.

(f) "Fixed Rent" shall mean the annual rental payable by Tenant for the Demised Premises in equal monthly installments as provided for in Article 3 of this Lease.

(g) "Interest Rate" shall mean the lesser of (i)) 2% above the prime commercial lending rate of Marine Midland Bank, N.A. in effect from time to time or (ii) the maximum applicable legal rate, if any.

(h) "Lease" shall mean this Indenture of Lease and any and all Schedules annexed hereto.

(i) "Term of this Lease" and "Term" shall mean the term of years commencing on the Commencement Date and expiring on the Expiration Date, subject to the terms and conditions hereinafter set forth.

Section 1.02. Landlord hereby leases to Tenant, and Tenant hereby rents from Landlord, the Demised Premises, subject to the provisions hereinafter set forth, together with appurtenances, including the right to use in common with others the lobbies, elevators and other public portions of the Building.

TO HAVE AND TO HOLD unto Tenant, its successors and permitted assigns, for the Term of this Lease.

ARTICLE 2.

Section 2.01. Tenant acknowledges that it has examined the Demised Premises and is taking same "as is" as of the Commencement Date. Tenant acknowledges that Landlord is not required to do any work with respect thereto.

Section 2.02. The Term of this Lease and the payment of rent shall commence on November 1, 1997 (herein the "Commencement Date"). The taking of possession by Tenant of the Demised Premises shall be deemed an acceptance of same by Tenant and shall also be conclusive evidence, as against Tenant, that the Demised Premises and the Building of which the same form a part were in good and satisfactory condition at the time of such occupancy and that the Demised Premises were substantially as shown on Schedule A.

Section 2.03. If Landlord shall be unable to give possession of the Demised Premises on the date anticipated for the commencement of the Term hereof for any reason whatsoever, Landlord shall not be subject to any liability, nor shall the validity of this Lease nor the obligations of Tenant hereunder be thereby affected. Landlord shall use diligent efforts to deliver possession of the Demised Premises promptly, subject to any delays beyond the reasonable control of Landlord. In the event that Landlord shall be unable to give possession of the Demised Premises on or prior to the date (the "Outside Delivery Date") which is two (2) months from the date hereof (subject to extension for a period of one (1) months in the aggregate by reason of force majeure [set forth immediately below]), Tenant may cancel and terminate this Lease by giving notice thereof to Landlord on or prior to the Outside Delivery Date, in which event this Lease shall terminate upon the giving of such notice, and the parties hereto shall have no further liabilities or obligations to each other hereunder. Any delay in Landlord's obtaining vacant possession of the Demised Premises caused by labor trouble, governmental controls, act of God, or any other cause beyond Landlord's reasonable control shall extend such time period for Landlord to give possession of the Demised Premises to Tenant. Without limiting the foregoing, the parties hereto expressly negate the provisions of Section 223-a of the Real Property Law and agree that such Section shall be inapplicable hereto. Tenant agrees that the provisions of this Article are intended to constitute "an express provision to the contrary" within the meaning of Section 223-a. If by reason of such delay, the Term of this Lease shall commence subsequent to such anticipated date, the Term of this Lease shall be deemed extended for the same period.

ARTICLE 3.

Section 3.01. During the Term of this Lease, Tenant shall pay, at Landlord's address as herein set forth, or at such other address that Landlord may from time to time designate, a Fixed Rent payable in lawful money of the United States of America (by check of Tenant drawn on a bank that is a member of the New York Clearinghouse Association) in equal monthly installments in advance on the first day of each calendar month, without notice or demand, and without setoff, abatement (except as expressly provided herein), or deduction whatsoever at annual rates as follows:

(i) $603,500 during the period beginning on the Commencement Date and continuing through June 30, 2000;

(ii) $680,000 during the period beginning on

July 1, 2000 and continuing through June 30, 2001;

(iii) $697,000 during the period beginning on July 1, 2001 and continuing through the balance of the Term.

If Tenant's obligation to pay Fixed Rent shall commence on a date other than the first day of a calendar month, the first installment of Fixed Rent shall be in an amount equal to that required to cover the period up to and including the last day of the month wherein the obligation to pay Fixed Rent occurs, computed on a per diem basis. Tenant shall pay the first full calendar monthly installment of Fixed Rent on the execution of this Lease.

Section 3.02. The Fixed Rent does not take into account increases of real estate taxes and/or expenses during the Term of this Lease or other adjustments in rent, or other payments to be made by Tenant, during the Term of this Lease. Provision therefor is hereinafter made.

Section 3.03. All costs and expenses, adjustments and payments, which Tenant assumes or agrees or is obligated to pay to Landlord pursuant to this Lease and/or its Schedules shall be deemed additional rent and, in the event of nonpayment, Landlord shall have all rights and remedies with respect thereto as herein provided for in case of nonpayment of Fixed Rent.

Tenant covenants to pay the Fixed Rent, additional rent and adjustments of rent as in this Lease provided, when due.

Section 3.04. For the purposes of this Section 3.04, the following definitions shall apply:

(a) The Term "Base Tax Year" as hereinafter set forth for the determination of real estate tax escalation shall mean the period commencing July 1, 1998, and ending June 30, 1999.

(b) The term "the Percentage" shall mean 2.29%.

(c) The term "Real Estate Taxes" shall mean all real estate taxes, assessments, water and sewer rents, governmental levies, county taxes or any other governmental charge, general or special, ordinary or extraordinary, unforeseen as well as foreseen, of any kind or nature whatsoever, which are or may be assessed or imposed upon the Land, the Building and the sidewalks, plazas or streets in front of or adjacent thereto, including any tax, excise or fee measured by or payable with respect to any rent, and levied against Landlord and/or the Land and/or Building, under the laws of the United States, the State of New York, or any political subdivision thereof, or by the City

of New York, or any political subdivision thereof. If, due to a future change in the method of taxation or in the taxing authority, a franchise, income, transit, profit or other tax or governmental imposition, however designated, shall be levied against Landlord, and/or the Land and/or the Building, in substitution in whole or in part for said Real Estate Taxes, or in lieu of additional real estate taxes, then such franchise, income, transit, profit or other tax or governmental imposition shall be deemed to be included within the definition of "Real Estate Taxes" for the purposes hereof. In the event that the Real Estate Taxes for the Base Tax Year shall include any charge with respect to any so called "Business Improvement District" or similar charge (a "Bid Charge"), and if any such Bid Charge is subsequently discontinued or eliminated, then, as of the date of such discontinuance or elimination, the Real Estate Taxes for the Base Tax Year shall be recalculated as if the Bid Charge had not originally been included therein.

(d) The term "Tax Year" shall mean every twelve-month consecutive period commencing each July 1st during the Term of this Lease.

(e) The term "Wage Rate" shall mean the minimum regular hourly wage rate plus all other sums, including, but not limited to, sums paid for pensions, welfare funds, vacations, bonuses, social security, unemployment, disability benefits, health, life, accident and other types of insurance required to be paid to or for the benefit of employees engaged in the general maintenance and operation of office buildings of the type and in the vicinity of the Building pursuant to a collective bargaining agreement (designated as "Others" in said agreement) between Realty Advisory Board on Labor Relations, Inc. (or any successor thereto) and Local 32B/32J of the Building Service Employees International Union AFL-CIO (or any successor thereto). The Wage Rate is intended to be an index in the nature of a cost of living index, and is not intended to reflect the actual costs of wages or expenses for the Building. If any such agreement is not entered into, or such parties or their successors shall cease to bargain collectively, then the Wage Rate shall be the minimum regular hourly wage rate and other sums as aforesaid payable to or for the benefit of employees engaged in the maintenance and operation of first class office buildings of the same general type as the Building in the Manhattan area.

(f) The term "Base Wage Rate" shall mean the Wage Rate in effect on January 1, 1998.

(g) The term "Wage Rate Factor" shall mean 17,000.

(A) Operating Expense Adjustment.

It is agreed that if at any time the Wage Rate shall be

greater than the Base Wage Rate, Tenant shall be required to pay to Landlord as additional rent an Operating Expense Adjustment in an annual sum equal to the product obtained by multiplying (i) the number of cents (including any fraction of a cent) by which the Wage Rate exceeds the Base Wage Rate by (ii) the Wage Rate Factor by (iii) 75%. Such Operating Expense Adjustment shall be payable to Landlord together with Fixed Rent in equal monthly installments on the first day of each calendar month commencing with the first month during the Term of this Lease in which the Wage Rate shall be greater than the Base Wage Rate and as billed by Landlord, continuing thereafter until a new adjustment in the additional rent shall be established and become effective in accordance with the provisions of this paragraph. Notwithstanding any change in Wage Rate downwards, the Fixed Rent shall not be reduced. In the event any change in the Wage Rate shall be made retroactive, Tenant shall pay Landlord the amount of any resulting retroactive adjustment in such additional rent within five (5) days after being billed therefor.

(B) Real Estate Tax Adjustment

In the event that the Real Estate Taxes payable for any Tax Year shall exceed the amount of such Real Estate Taxes, as finally determined, payable with respect to the Base Tax Year, Tenant shall pay to Landlord, as additional rent ("Tenant's Tax Payment") for such Tax Year, an amount equal to the Percentage of the excess. By or after the start of the Tax Year following the Base Tax Year, and by or after the start of each Tax Year thereafter, Landlord shall furnish to Tenant a statement of the Real Estate Taxes payable with respect to such Tax Year, and a statement of the Real Estate Taxes payable during the Base Tax Year.

Within thirty (30) days after the issuance by the governmental authority having jurisdiction thereover of tax bills for Real Estate Taxes assessed, levied and/or imposed upon the Land and Building for any Tax Year, Landlord shall submit to Tenant a photostatic copy of such bill and/or bills and thereafter on or about each respective anniversary date shall submit a copy of the tax bill and/or bills for the Real Estate Taxes assessed, levied or imposed upon the Land and Building for such Tax Year, together with a statement which shall indicate the amount, if any, of Tenant's Tax Payment. Landlord's failure to submit copies of bills as aforesaid shall not be considered a default by Landlord or a defense by Tenant to such tax payment.

Within thirty (30) days after the issuance of the statement, Tenant shall pay Tenant's Tax Payment in the amount set forth on such statement. Such statement shall be conclusively deemed binding upon Tenant unless Tenant shall have objected thereto in writing within thirty (30) days of receipt thereof. Notwithstanding the foregoing provisions of this paragraph, Tenant's Tax Payment shall be payable in the same

number of installments as Real Estate Taxes are payable to the taxing authority and shall be payable not more than thirty (30) days in advance of the date on which the corresponding installment is due such taxing authority without incurring any penalty, interest or late charge.

In the event Landlord shall receive a final reduction or refund of Real Estate Taxes for any Tax Year for which Tenant is obligated to pay any additional rent under the provisions of this subsection B of Section 3.04, the amount or the proceeds of such reduction or refund, less legal fees and other expenses incurred in collecting the same or achieving such reduction, shall be applied and allocated to the periods for which such final reduction or refund was obtained, and proper adjustment shall be promptly made between Landlord and Tenant. Tenant has been advised that proceedings to protest the Real Estate Tax assessment for the Base Tax Year may have been filed and may result in a reduction of Real Estate Taxes for the Base Tax Year.

Any payments or refunds due hereunder for any period of less than a full Tax Year at the commencement or end of the Term of this Lease shall be equitably prorated to reflect such event.

In addition to Tenant's obligation to pay Tenant's Tax Payment as aforesaid, Tenant shall pay to Landlord as additional rent payable upon demand, any occupancy tax or rent tax now in effect or hereafter enacted, if payable by Landlord in the first instance or hereafter required to be paid by Landlord.

Section 3.05. Upon the date of the expiration or any sooner termination of this Lease, whether the same be the date hereinabove set forth as the expiration of the Term of this Lease (hereinafter called "Lease Expiration Date") or any prior or subsequent date, a proportionate share of the Fixed Rent, adjustments and additional rents for the year (calendar or fiscal) in which such expiration or termination occurs, shall immediately become due and payable by Tenant to Landlord as hereinafter provided, if not theretofore already billed and paid. Such proportionate share shall be based upon the length of time that this Lease shall have been in existence during such year. Promptly after any such expiration or termination, Landlord shall compute the amounts due from Tenant, as aforesaid, which computations shall either be based on that year's actual figures or be an estimate based on the most recent statements theretofore prepared by Landlord and furnished to Tenant pursuant to this Lease. If an estimate is used, then Landlord shall promptly cause statements to be prepared on the basis of the comparative year's actual figures as soon as they are available, and within ten (10) days after such statement or statements are prepared by Landlord and furnished to Tenant, Landlord and Tenant shall make appropriate adjustments of any estimated payments theretofore made.

Tenant's obligation to pay any and all rents, adjustments and additional rents under this Lease shall continue and shall cover all periods up to the Lease Expiration Date. Landlord's and Tenant's obligations to make the adjustments hereinabove referred to shall survive any expiration or termination of this Lease. Any delay or failure of Landlord in billing any Fixed Rent or additional rent herein provided for shall not constitute a waiver of or in any way impair the continuing obligation of Tenant to pay such rent adjustments hereunder; provided, however, that Landlord shall not be entitled to render to Tenant a statement requiring payment of an adjustment of rent under this Article 3 later than two (2) full calendar years, in the case of an adjustment with respect to Operating Expenses, and two (2) full Tax Years, in the case of an adjustment with respect to Real Estate Taxes, after the expiration of the year with respect to which such adjustment relates.

ARTICLE 4.

Section 4.01. Tenant's electricity consumption and demand in the Demised Premises shall be measured by existing submeters, and Tenant agrees to purchase such electricity from Landlord or Landlord's designated agent at terms and rates for electricity under the same rate classification and frequency that Landlord is charged by the local public utility furnishing electricity to the Building computed as if Tenant were a separate customer purchasing power at such rate classification and frequency under a single aggregated account thereunder, but in no event shall the amount payable by Tenant per Kilowatt Hour be less than Landlord's average cost per Kilowatt Hour at such rate as would be applicable for purchasing electric energy for the entire Building, plus eight (8%) percent thereof to reimburse Landlord for administrative services and for line loss in connection with supplying and billing such electricity. All such sums shall be paid by Tenant to Landlord as additional rent hereunder. If more than one meter measures the electricity consumption and demand of Tenant in the Building, the service rendered through each meter shall be aggregated and billed in accordance with the above rate classification, unless Landlord shall elect separate billing on a per-meter basis. Landlord may at any time render bills for Tenant's consumption and demand and Tenant shall pay the same within thirty (30) days following the date the same are rendered. At Landlord's option, Tenant shall purchase from the Landlord or Landlord's agent all lighting tubes, lamps, bulbs and ballasts used in the Demised Premises and Tenant shall pay Landlord's reasonable charges for providing and installing same on demand, as additional rent. Landlord represents that the meter measuring Tenant's consumption of electricity in the Demised Premises does not measure electricity

consumption in any area other than the Demised Premises.

Section 4.02. Tenant's use of electric energy in the Demised Premises shall not at any time exceed the capacity of any of the electrical conductors, machinery and equipment in or otherwise serving the Demised Premises. In order to insure that such capacity is not exceeded and to avert possible adverse effect upon the Building electric service, Tenant shall not, without Landlord's prior written consent in each instance, connect any additional fixtures, machinery, appliances or equipment to the electric system of the Demised Premises existing on the Commencement Date other than lamps, typewriters, copiers, computer terminals, copying machines, communications equipment such as telephones, fax machines, appliances, and other small office machines that consume comparable or less amounts of electricity. Should Landlord grant such consent, any additional risers or other equipment required therefor shall be provided by Landlord, and the cost thereof shall be paid by Tenant within thirty (30) days following Landlord's demand therefor.

Section 4.03. Landlord shall not be liable in any way to Tenant for any failure or defect in the supply or character of electric energy furnished to the Demised Premises by reason of any requirement, act or omission of the public utility servicing the Building with electricity, or for any other reason whatsoever.

Section 4.04. Landlord reserves the right to discontinue furnishing electric energy to Tenant at any time upon not less than ninety (90) days prior written notice to Tenant provided that Landlord shall have made such election as to the majority of all tenants occupying the Building and further provided that electric service is available directly from the public utility servicing the Building (Landlord hereby agreeing, unless otherwise required by law, not to discontinue furnishing electricity to Tenant until such time as Tenant is able to obtain same directly from the public utility). If Landlord exercises such right of termination, from and after the effective date of such termination, Landlord shall no longer be obligated to furnish Tenant with electric energy. If Landlord exercises such right of termination, this Lease shall remain unaffected thereby and shall continue in full force and effect, and promptly upon receipt of such notice Tenant shall diligently arrange to obtain electric service directly from the public utility company servicing the Building. In connection with obtaining such electric service directly from the public utility company Tenant may utilize the then existing electric feeders, risers and wiring serving the Demised Premises to the extent the same are available, suitable and safe for such purposes, but only to the extent of Tenant's then authorized connected load. All meters and additional panel boards, feeders, risers, wiring and other conductors and equipment which may be required to obtain electric energy directly from such public utility company shall be

installed and maintained by Tenant at its expense if Landlord's election to discontinue furnishing electric energy to Tenant shall have been required by applicable law. If, however, Landlord shall voluntarily elect to discontinue furnishing electric energy to Tenant, then Landlord shall install the foregoing and pay for the cost (but not the maintenance) of the same.

Section 4.05. Unless otherwise agreed by the parties, Landlord shall supply all electric meters for use hereunder. In no instance shall Tenant install or permit the installation or use of the electric meters or electric metering devices for any purpose whatsoever unless such meters and/or metering devices shall conform in every respect to the requirements, rules and regulations of the local public utility as approved from time to time by the Public Service Commission of the State of New York as to the accuracy of measurement of such meters or metering devices, including, but not limited to, proper measurement and reflection of power factor.

Section 4.06. Tenant covenants and agrees that at no time will the connected electrical load serving the Demised Premises exceed 6 watts per gross square foot (exclusive of any power required for the heating, ventilating and air-conditioning serving the Demised Premises). Landlord represents that no less than six (6) watts per gross square foot (exclusive of any power required for the heating, ventilating and air-conditioning serving the Demised Premises) of electric service is presently available to the Demised Premises, and, subject to the provisions of Section 4.04, will continue to be available to the Demised Premises during the entire Term.

Section 4.07. If any tax is imposed upon Landlord with respect to electrical energy furnished as a service to Tenant by any federal, state or municipal authority, Tenant covenants and agrees that where permitted by law or applicable regulations, Tenant's pro rata share of such taxes shall be reimbursed by Tenant to Landlord as additional rent.

ARTICLE 5.

Section 5.01. Tenant shall use and occupy the Demised Premises for administrative, executive and general business office purposes only and for no other purposes. Such office use may include ordinary office pantries.

Section 5.02. Tenant shall not suffer or permit the Demised Premises or any part thereof to be used in any manner, or anything to be done therein, or suffer or permit anything to be brought into or kept in the Demised Premises which would in any

way (i) violate any law or requirement of public authorities, (ii)cause structural injury to the Building or any part thereof, (iii)interfere with the normal operation of the heating, air-conditioning, ventilating, plumbing or other mechanical or electrical systems of the Building or the elevators installed therein, (iv) constitute a public or private nuisance, (v) alter the appearance of the exterior of the Building or of any portion of the interior thereof other than the Demised Premises.

Section 5.03. Tenant shall not, without the prior written consent of Landlord (which shall not be unreasonably withheld or delayed), allow a "Servicing Company" (defined below) to install any telephone, data, information or other communications equipment in the Demised Premises to service premises occupied by persons other than Tenant and/or its affiliates. For example, the Demised Premises may not be used as a so-called "switching" or "relay" station serving third parties (that is, parties other than Tenant and its affiliates) without such consent by Landlord. In granting such consent, Landlord may require that the Servicing Company enter into a license agreement with Landlord confirming that the Servicing Company shall have no independent rights in the Demised Premises and that upon termination of this Lease, for whatever reason, the Servicing Company will have no right to leave its equipment in the Demised Premises. Landlord may make a reasonable charge to the Servicing Company for allowing it to install its equipment in the Demised Premises. A "Servicing Company" shall mean a person, firm, corporation or other entity other than Tenant whose equipment services not only the Demised Premises, but other premises or parties as well.

ARTICLE 6.

Section 6.01. Tenant shall take good care of the Demised Premises and the fixtures and appurtenances, therein, and at its sole cost and expense make all repairs thereto as and when needed to preserve them in good working order and condition (other than structural repairs and repairs to the plumbing, wiring and other Building equipment for the general supply of water, heat, air-conditioning, gas and electricity which are not caused by the carelessness, omission, neglect, improper conduct or other cause of Tenant, its servants, employees, agents, visitors or licensees and other than repairs necessitated by the acts of Landlord, its agents, servants or employees or when otherwise required to be made by Landlord under this Lease). All damage or injury to the Demised Premises and to its fixtures, appurtenances and equipment or to the Building of which the same form a part, or to its fixtures, appurtenances and equipment, caused by Tenant moving property, or resulting from any air-conditioning unit or system, any short circuit, flow or leakage of water, steam, illuminating gas, sewer gas, sewerage or odors, or by frost or by bursting or leaking of pipes or plumbing works or gas or from any other cause of any other kind or nature whatsoever, in any such event, due to carelessness, omission, neglect, improper conduct or other cause of Tenant, its servants, employees, agents, visitors or licensees, shall be repaired, restored or replaced promptly by Tenant, at its sole cost and expense, to the satisfaction of Landlord. If Tenant fails to make such repairs, restorations or replacements, same may be made by Landlord at the expense of Tenant and any costs therefor shall be collectible as additional rent or otherwise, and shall be paid by Tenant within five (5) days after rendition of a bill or statement therefor.

Section 6.02. Landlord shall, at its expense, make all repairs and replacements, structural and otherwise, necessary in order to keep in good order and repair the exterior of the Building and the public portions of the Building, the need for which Landlord shall have knowledge (including the public halls and stairways, plumbing, wiring and other Building equipment for the general supply of water, heat, air-conditioning, gas and electricity) except repairs hereinabove provided to be made by Tenant and repairs, the need for which Tenant has not reported to Landlord.

Section 6.03. All repairs, restorations or replacements by either party shall be of first-class quality and done in good and workmanlike manner. Tenant shall, and shall include in all contracts, subcontracts and purchase orders a requirement that such contractors, subcontractors or materialmen, as the case may be, shall, cause all workers at the Demised

Premises to work harmoniously with each other and with Building personnel and in a manner which will not disrupt access to or use of the common areas of the Building, cause inconvenience to the other tenants in the Building or interfere with the conduct of other tenants' business. Tenant agrees that should Tenant, its agents and/or contractors, enter upon the Demised Premises for the purpose of performing any work, the labor employed by Tenant or anyone performing such work, for or on behalf of Tenant, shall always be harmonious and compatible with the labor employed by Landlord or any contractors or subcontractors of Landlord. Should such labor be unharmonious or incompatible, Landlord may require Tenant to withdraw such labor from the Demised Premises. In the event Tenant or Tenant's contractor shall enter upon the Demised Premises or any other part of the Building, Tenant agrees to indemnify and save Landlord free and harmless, from and against any and all claims whatsoever arising out of said entry or such work. Tenant's agents, contractors and their employees shall comply with the special rules, regulations and requirements of building management for the performance and coordination of said agents, contractors and their employees so as to avoid the intrusion into the operation of the Building and to avoid disturbing the quiet enjoyment of other tenants.

Section 6.04. Tenant shall not store or place any materials or other obstructions in the lobby or other public portions of the Building, or on the sidewalk adjacent to the Building.

Section 6.05. Tenant shall do no work and shall make no alterations, decorations, installations, additions or improvements in or to the Demised Premises, including, but not limited to, a water cooler, an air-conditioning or cooling system unit or part thereof or other apparatus of like or other nature, without Landlord's prior written consent which consent shall not be unreasonably withheld or delayed in the case of alterations, decorations, installations, additions or improvements in the Demised Premises which are non-structural in nature and do not affect the structure, exterior or common areas of the Building (it being understood that the 38th floor elevator lobby is not deemed to be a common area of the Building) or adversely affect the heating, ventilating or air-conditioning, electrical, mechanical, plumbing or elevator systems of the Building or other tenants' use thereof, and then only by contractors or mechanics approved by Landlord. Such approval must be obtained prior to any bidding for said work. Tenant has submitted to Landlord preliminary plans and specifications for certain improvements to the Demised Premises, dated October 13, 1997, labeled Drawing SP-1 prepared by Descon Interiors Incorporated (the "Preliminary Plans"). Landlord hereby consents to the performance of the work described in the Preliminary Plans provided such work is consistent with such Preliminary Plans. All such work, alterations, decorations, installations, additions or improvements shall be done at Tenant's sole expense and at such

times and in such manner as Landlord may from time to time designate and in full compliance with all governmental bodies having jurisdiction thereover. Tenant's work, alterations, decorations, installations, additions or improvements shall be completed free of all liens and encumbrances and, as a condition precedent to Landlord's consent to the making by Tenant of alterations, decorations, installations, additions or improvements to the Demised Premises, Tenant agrees to obtain, and deliver to Landlord, written and unconditional waivers of mechanics' liens upon the real property in which the Demised Premises are located, for all work, labor and services to be performed and materials to be furnished by them in connection with such work, signed by all contractors, subcontractors, materialmen and laborers to become involved in such work.

Landlord shall not be liable for any failure of the air-conditioning and ventilating equipment in the Demised Premises installed by Landlord caused by any work, alterations, decorations, installations, additions or improvements by Tenant, and Tenant shall correct any such condition causing such failure promptly upon notice from Landlord of the need therefor. If Tenant shall fail to correct same, Landlord may make such correction and charge Tenant for the cost thereof. Such sum due Landlord shall be deemed additional rent and shall be paid by Tenant promptly upon being billed therefor.

Section 6.06. Prior to commencing any work pursuant to the provisions of Section 6.05, Tenant shall furnish to Landlord:

(i) Copies of all governmental permits and authorizations which may be required in connection with such work.

(ii) A certificate evidencing that Tenant (or Tenant's contractors) has (have) procured workers' compensation insurance covering all persons employed in connection with the work who might assert claims for death or bodily injury against Landlord, "Overlandlord" (as hereinafter defined), Tenant or the Building.

(iii) Such additional personal injury and property damage insurance (over and above the insurance required to be carried by Tenant pursuant to the provisions of Article 9) as Landlord may reasonably require because of the nature of the work to be done by Tenant.

Section 6.07. All work, alterations, decorations, installations, additions or improvements upon the Demised Premises, made by either party, including all paneling, decorations, partitions, railings, mezzanine floors, galleries and the like, affixed to the realty or for which Tenant has received a credit shall, unless Landlord elects otherwise (which

election shall be made by giving a notice pursuant to the provisions of Article 30 not less than thirty (30) days prior to the expiration or other termination of this Lease or any renewal or extension thereof) become the property of Landlord, and shall remain upon, and be surrendered with, said premises, as a part thereof, at the end of the term or renewal term, as the case may be. At the same time Tenant submits to Landlord its request for consent to any alterations, decorations, installations, additions or improvements and the plans and specifications therefor, Tenant may request, in writing, that Landlord specify any "Atypical Alterations" (as defined below) which Tenant shall be required to remove on or before the expiration of the Term of this Lease. Landlord shall notify Tenant at the time of the consent to the alterations, decorations, installations, additions or improvements and the plans and specifications in question, of those Atypical Alterations which Tenant is required to remove before the expiration of the Term of this Lease in accordance with the terms of this Section 6.07, and Tenant shall, upon the expiration or the earlier termination of the Term of this Lease, remove at Tenant's sole cost and expense, such Atypical Alterations specified in Landlord's notice, repair any damage to the Demised Premises in connection therewith and restore the Demised Premises to the condition existing prior to the Atypical Alterations. For purposes hereof, the term "Atypical Alterations" shall be deemed to include, but not be limited to, a raised floor, louvered windows, any kitchen facility (as opposed to a pantry), any vault and any audio or video installation. Additionally, Landlord hereby agrees that Tenant shall have no obligation upon the expiration or earlier termination of the Term to restore (i) any alterations or improvements existing on the date hereof and
(ii) all alterations and improvements as shown on the Preliminary Plans. All movable property, furniture, furnishings and trade fixtures, alterations, installations and additions other than those affixed to the realty so that they cannot be removed without material damage shall remain the property of Tenant and shall be removed from the Demised Premises on or before the Expiration Date. In the event of damage to the Demised Premises or the Building by reason of such removal, Tenant shall restore the same to good order and condition (normal wear and tear excepted). If Tenant should desire to leave any part of such property in the Demised Premises upon the expiration of the Term, it shall so notify Landlord in writing not less than sixty (60) days prior to the expiration of the Term of this Lease specifying the items of property which it desires to so leave. If within thirty (30) days after the service of such notice Landlord shall request Tenant to remove any of the said property, Tenant shall at its expense at or before the expiration of the Term of this Lease, remove said property, and, in case of damage by reason of such removal, restore the Demised Premises to good order and condition (normal wear and tear excepted).

Section 6.08. Landlord shall not be responsible for supervision and/or coordination in respect to Tenant's

alterations or repairs. Landlord's managing agent shall perform such supervision and coordination, and with respect to any work, alteration, decoration, addition or improvement costing more than $10,000, Tenant agrees to pay to such managing agent promptly upon being billed therefor, a sum equal to ten (10%) percent of the cost of such work, for indirect costs, field supervision and coordination in connection therewith. Tenant agrees to keep records of Tenant's work, alterations, decorations, additions and improvements costing in excess of $10,000 and of the cost thereof. Tenant agrees to furnish to Landlord's managing agent copies of such records certified as correct by Tenant within forty-five
(45) days of such managing agent's request therefor. Landlord hereby agrees that the foregoing supervisory fee shall not apply to work performed by Tenant in the Demised Premises in order to prepare same for Tenant's initial occupancy thereof.

Section 6.09. Tenant will not do any act or suffer any act to be done which will in any way encumber the title of Landlord or Tenant in and to the Demised Premises or the Building or the Land nor will the interest or estate of Landlord or Tenant in the Demised Premises or the Building or the Land be in any way subject to any claim by way of lien or encumbrance, whether by operation of law or by virtue of any express or implied contract by Tenant.

Section 6.10. Tenant will not suffer or permit any liens to stand against the Demised Premises, the Building or the Land or any part thereof, by reason of any work, labor, services or materials done for, or supplied to, or claimed to have been done for, or supplied to, Tenant, or anyone holding the Demised Premises, or any part thereof, through or under Tenant. If any such lien is at any time filed against the Demised Premises or the Building or the Land, Tenant will cause the same to be discharged of record within thirty (30) days after the date of filing the same, by either payment, deposit or bonding (and the failure of Tenant to do so shall be a material default hereunder entitling Landlord to give a notice to Tenant pursuant to the provisions of Section 17.01(1) hereof). In addition to any other right or remedy of Landlord, Landlord may, but will not be obligated to, procure the discharge of the same either by paying the amount claimed to be due by deposit in court or bonding, and/or Landlord will be entitled, if Landlord so elects, to compel the prosecution of an action for the foreclosure of such lien by the lienor and to pay the amount of the judgment, if any, in favor of the lienor with interest computed at the Interest Rate, costs and allowances. Any amount paid or deposited by Landlord for any of the aforesaid purposes, and all legal and other expenses of Landlord, including, without limitation, reasonable attorneys' fees incurred in defending such action or in procuring the discharge of such lien, with all necessary disbursements in connection therewith, will become due and payable on the date of payment or deposit, as additional rent.

Section 6.11. Nothing in this Lease will be deemed to be, or construed in any way as constituting, the consent or request of Landlord, express or implied by inference or otherwise, to any person, firm or corporation for the performance of any labor or the furnishing of any materials for any construction, rebuilding, alteration or repair of or to the Demised Premises, the Building or the Land or any part thereof, nor as giving Tenant any right, power or authority to contract for or permit the rendering of any services or the furnishing of any materials which might in any way give rise to the right to file any lien against Landlord's interest in the Demised Premises, the Building or the Land.

ARTICLE 7.

Section 7.01. Tenant shall not place a load upon any floor of the Demised Premises which exceeds the load per square foot which such floor was designed to carry and which is allowed by law.

Section 7.02. Business machines and mechanical equipment belonging to Tenant which cause noise or vibration that may be transmitted to the structure of the Building or the Demised Premises to such a degree as to be objectionable to Landlord shall be placed and maintained by the party owning the machines or equipment, at such party's expense, in settings of cork, rubber or spring type vibration eliminators sufficient to eliminate noise or vibration.

Section 7.03. Tenant will not clean, nor require, permit, suffer or allow any window in the Demised Premises to be cleaned, from the outside in violation of Section 202 of the Labor Law or of the rules of the Board of Standards and Appeals or of any other board or body having or asserting jurisdiction.

ARTICLE 8.

Section 8.01. Tenant shall, at its expense, comply with all laws, orders, ordinances and regulations or any direction made pursuant to law of any public officer or officers which shall, with respect to the particular use or manner of use of the Demised Premises (as opposed to mere use and occupancy as contemplated by Article 5), or to any abatement of nuisance, impose any violation, order or duty upon Landlord or Tenant arising from Tenant's particular use or manner of use of the Demised Premises (as opposed to mere use and occupancy as contemplated by Article 5), or as a result of any installations made therein (whether or not in compliance with the work article) by Tenant or at Tenant's request or required by reason of a breach of any of Tenant's covenants or agreements hereunder.

Section 8.02. If Tenant should desire to contest the validity of any such law, ordinance, rule, order or regulation with which Tenant is obligated to comply, it may, at its expense, carry on such contest; and non-compliance by it during such contest (so long as Tenant proceeds with due diligence) shall not constitute a breach of this Lease provided that it shall, to the satisfaction of Landlord, indemnify and hold Landlord harmless against all liability for any loss, damages, and expenses (including, without limitation, reasonable attorneys' fees) which might result from or be incurred in connection with such contest or non-compliance. Notwithstanding the foregoing, non-compliance as aforesaid shall not commence or continue if it might subject Landlord to any fine or penalty or to prosecution for a crime, or if it would constitute a default by Landlord under any mortgage or lease affecting the Building and/or the Land.

Section 8.03. If Tenant receives written notice of any violation of law, ordinance, rule, order or regulation applicable to the Demised Premises, it shall give prompt notice thereof to Landlord.

Section 8.04. Except as aforesaid, Landlord shall, at its expense, comply with or cause to be complied with, all laws, orders, ordinances and regulations of federal, state, county and municipal authorities and any direction made pursuant to law of any public officer or officers which shall with respect to the public portions of the Building, impose any violation,

order or duty upon Landlord or Tenant and with respect to which Tenant is not obligated by Section 8.01 to comply. Except as aforesaid, Landlord shall further, at its expense, comply with or cause to be complied with, all laws, ordinances, rules, regulations and orders of federal, state, county and municipal authorities and any direction made pursuant to law of any public officer or officers which affect Tenant's use or enjoyment of, or access to, the Demised Premises and with respect to which Tenant is not obligated by
Section 8.01 to comply. Landlord may, at its expense, contest the validity of any such law, ordinance, rule, order or regulation.

Section 8.05. Landlord hereby agrees to deliver to Tenant a form ACP-5 with respect to the Demised Premises within twenty (20) days after the date hereof.

ARTICLE 9.

Section 9.01. Tenant shall not do or permit to be done any act or thing upon the Demised Premises which will invalidate or be in conflict with the Certificate of Occupancy or the terms of the New York State standard form of fire, boiler, sprinkler, water damage or other insurance policies covering the Building and the fixtures and property therein; and Tenant shall at its own expense, comply with all rules, orders, regulations or requirements of the New York Board of Fire Underwriters or any other similar body having jurisdiction, and shall not knowingly do or permit anything to be done in or upon the Demised Premises in a manner which increases the rate of fire insurance upon the Building or on any property or equipment located therein over the rate in effect at the commencement of the Term of this Lease.

Section 9.02. If, by reason of any failure of Tenant to comply with the provisions of this Lease, the rate of fire, boiler, sprinkler, water damage or other insurance (with extended coverage) on the Building or on the property and equipment of Landlord or any other tenant or subtenant in the Building shall be higher than it otherwise would be, Tenant shall reimburse Landlord and the other tenants in the Building for that part of the fire, boiler, sprinkler, water damage or other insurance premiums thereafter paid by Landlord or by the other tenants in the Building which shall have been charged because of such failure by Tenant, and Tenant shall make the reimbursement on the first day of the month following such payment by Landlord or such other tenants. In any action or proceeding wherein Landlord and Tenant are parties, a schedule or "make up" of any insurance rate for the Building or Demised Premises issued by the New York Fire Insurance Exchange, or other body establishing fire insurance rates for the Building, shall be conclusive evidence of the facts therein stated and of the several items and charges in the

insurance rates then applicable to the Building or Demised Premises.

Section 9.03. Tenant, at Tenant's own cost and expense, shall maintain insurance protecting and indemnifying Landlord and Tenant (and at Landlord's request, the landlord under any ground or underlying lease [herein "Overlandlord"], as well as the holder of any mortgage affecting the Land, the Building or both) against any and all claims for injury or damage to persons or property for the loss of life or of property occurring upon, in or about the Demised Premises, and the public portions of the Building used by Tenant, its employees, agents, contractors, customers and invitees arising out of the negligent act or omission of any of the foregoing, such insurance to afford minimum protection during the Term of this Lease of not less than a single combined limit of $3,000,000 in respect of property damage and bodily injury or death to any one person or in respect of any one occurrence or accident. Landlord may from time to time require that the amount of liability insurance to be maintained by Tenant under this Article be increased so that Landlord shall be adequately protected giving due consideration to all relevant circumstances and conditions. Any such increase shall be consistent with increases required by landlords of similar buildings in the Midtown Manhattan area.

All such insurance shall be effected under valid and enforceable policies (which may cover the Demised Premises and other locations), shall be issued by insurers of recognized responsibility and shall contain a provision whereby the insurer agrees not to cancel the insurance without ten (10) days' prior written notice to Landlord.

On or before the Commencement Date of this Lease, Tenant shall furnish Landlord with a certificate evidencing the aforesaid insurance coverage, and renewal certificates shall be furnished to Landlord at least thirty (30) days prior to the expiration date of each policy for which a certificate was theretofore required to be furnished.

Section 9.04. Tenant shall give Landlord notice in case of a fire or accident in the Demised Premises or the Building, or of defects therein or in any fixtures or equipment, promptly after Tenant is aware of the same.

Section 9.05. Tenant shall indemnify and hold Landlord harmless from and against all liabilities, suits, claims, demands and actions, and costs and expenses of any kind or nature, due to or arising out of any injury to person or property, including death resulting at any time therefrom, occurring in or about the Demised Premises (unless caused by or due to the negligence or willful misconduct of Landlord, its agents, employees, contractors or invitees, in which event Tenant's indemnification herein shall be only to the extent, if any, of Tenant's negligence or willful misconduct or that of Tenant's agents, employees, contractors or invitees). To the extent of any valid and collectible insurance furnished by Tenant for the protection of Landlord, Tenant's obligation to indemnify and hold Landlord harmless against liability which is covered by such insurance shall be deemed, to the extent thereof, to be satisfied.

Section 9.06. Landlord and Tenant shall each endeavor to secure an appropriate clause in, or an endorsement upon, each fire or extended coverage or rent insurance policy obtained by it and covering the Building, the Demised Premises or the personal property, fixtures and equipment located therein or thereon, pursuant to which the respective insurance companies waive subrogation or permit the insured, prior to any loss, to agree with a third party to waive any claim it might have against said third party. Each party hereto shall give prompt notice to the other in the event such clause is or becomes unavailable. The waiver of subrogation or permission for waiver of any claim shall extend to the agents of each party and the employees of each party and its respective agents and, in the case of Tenant, shall also extend to all other persons and entities occupying or using the Demised Premises. If and to the extent that such waiver or permission can be obtained only upon payment of an additional charge, then the party benefiting from the waiver or permission shall pay such charge upon written demand, or shall be deemed to have agreed that the party obtaining the insurance coverage in question shall be free of any further obligations under the provisions hereof relating to such waiver or permission.

Subject to the foregoing provisions of this Section 9.06, each party hereby releases the other with respect to any claim (including a claim for negligence) which it might otherwise have against the other party for loss, damages or destruction with respect to its property by fire or other casualty (including rental value or business interest, as the case may be) occurring during the Term of this Lease.

Landlord represents that it currently can and agrees to obtain a so-called "waiver of subrogation" clause in its insurance policy covering the Building. Landlord agrees that it will notify Tenant if, at any time during the Term Landlord can no longer obtain said "waiver of subrogation" clause it its insurance policy.

Section 9.07. Tenant agrees to look solely to Landlord's estate and interest in the Land and Building, or the lease of the Building, or of the Land and Building, and the Demised Premises, for the satisfaction of any right or remedy of Tenant for the collection of a judgment (or other judicial process) requiring the payment of money by Landlord, in the event of any liability by Landlord, and no other property or assets of Landlord shall be subject to levy, execution, attachment, or other enforcement procedure for the satisfaction of Tenant's remedies under or with respect to this Lease, the relationship of Landlord and Tenant hereunder, or Tenant's use and occupancy of the Demised Premises, or any other liability of Landlord to Tenant.

Section 9.08 Landlord agrees that the officers, directors and shareholders of Tenant, or any Related Entity (as hereinafter defined) of Tenant, shall not be personally liable for the obligations of Tenant under the terms of this Lease, but this Section 9.08 shall not be deemed to diminish or change the obligations of Tenant hereunder.

ARTICLE 10.

Section 10.01. If the Building or the Demised Premises shall be partially or totally damaged or destroyed by fire or other cause, then whether or not the damage or destruction shall have resulted from the fault or neglect of Tenant, or its employees, agents or visitors (and if this Lease shall not have been terminated as in this Article 10 hereinafter provided), Landlord shall repair the damage and restore and rebuild the Building and/or the Demised Premises (without limiting the rights of any insurance company, subrogated to Landlord's rights hereunder pursuant to the terms of any insurance policy as to which Landlord shall have been unable to obtain a waiver of subrogation in accordance with Section 9.06 hereof, to seek recovery from Tenant, and any rights of Landlord under any other provisions of this Lease or at law or in equity), with reasonable dispatch after notice to it of the damage or destruction; provided, however, that Landlord shall not be required to repair or replace any of Tenant's property. Notwithstanding anything contained herein to the contrary, in no event shall Tenant be relieved of liability or responsibility for damage or destruction resulting from the fault or neglect of Tenant if the insurance policies carried by Landlord on the Building do not contain a waiver of the right of subrogation.

Section 10.02. If the Building or the Demised Premises shall be partially destroyed by fire or other cause, the rents payable hereunder shall be abated to the extent that the Demised Premises shall have been rendered untenantable and for the period from the date of such damage or destruction to the date the damage shall be repaired or restored. If the Demised Premises or a major part thereof shall be totally (which shall be deemed to include substantially completely) untenantable on account of fire or other cause, the rent shall abate as of the date of the damage or destruction and until Landlord shall repair, restore and rebuild the Building and the Demised Premises, provided, however, that should Tenant reoccupy a portion of the Demised Premises during the period the Demised Premises are made completely untenantable, rents allocable to such portion shall be payable by Tenant from the date of such occupancy.

Section 10.03. If the Building or Demised Premises shall be totally damaged or destroyed by fire or other cause, or if the Building shall be so damaged or destroyed by fire or other cause that Landlord shall decide not to restore or rebuild it, then in either such case Landlord may terminate this Lease by giving Tenant notice to such effect within one hundred twenty
(120) days after the date of the casualty. If the Demised Premises shall be substantially damaged or destroyed during the final two (2) years of the Term, each of Landlord and Tenant shall have the option, to be exercised by giving written notice to the other, within thirty (30) days of the occurrence of such damage, to terminate this Lease and the Term and estate hereby granted as of the date of such damage or destruction. In case of any damage or destruction mentioned in this Article 10, Tenant may terminate this Lease by notice to Landlord, if Landlord has not completed the making of the required repairs and restored and rebuilt the Building and the Demised Premises within nine (9) months from the date of such damage or destruction, or within such period after such date (not exceeding three (3) months) as shall equal the aggregate period Landlord may have been delayed in doing so by adjustment of insurance, labor trouble, governmental controls, act of God, or any other cause beyond Landlord's reasonable control, and such termination shall be effective upon the expiration of thirty (30) days after the date of such notice.

Section 10.04. No damages, compensation or claim shall be payable by Landlord for inconvenience, loss of business or annoyance arising from any repair or restoration of any portion of the Demised Premises or of the Building pursuant to this Article 10. Landlord shall endeavor to effect such repair or restoration promptly and in such manner as not unreasonably to interfere with Tenant's business, provided that no additional costs, for labor at overtime or premium rates, or otherwise, are incurred thereby.

Section 10.05. Tenant covenants and agrees to cooperate with Landlord, the landlord under any ground or underlying lease to which this Lease is subject and subordinate or any mortgagee of any mortgage to which this Lease is subordinate in their attempts to collect insurance proceeds (including rent insurance proceeds) payable to any of such parties.

Section 10.06. Landlord will not carry separate insurance of any kind on Tenant's property, and Landlord shall not be obligated to repair any damage thereto or replace the same.

Section 10.07. In the event of the termination of this Lease pursuant to any of the provisions of this Article 10, this Lease and the Term and estate hereby granted shall expire as of the date of such termination with the same effect as if that were the originally stated Expiration Date set forth in Section 1.01(e) hereof, and the Fixed Rent and additional rent payable hereunder shall be apportioned as of such date.

Section 10.08. The provisions of this Article 10 shall be considered an express agreement governing any case of damage or destruction of the Demised Premises by fire or other casualty, and Section 227 of the Real Property Law of the State of New York, providing for a contingency in the absence of an express agreement, and any other law of like import, now or hereafter in force, shall have no application to the Demised Premises and this Lease.

ARTICLE 11.

Section 11.01. (a) Tenant will not by operation of law or otherwise, assign, mortgage or encumber this Lease, nor the estate and Term hereby granted, nor sublet or permit the Demised Premises or any part thereof to be used by others, without Landlord's prior written consent in each instance. The consent by Landlord to any assignment or subletting shall not in any manner be construed to relieve Tenant from obtaining Landlord's express written consent to any other or further assignment or subletting.

If Tenant desires to assign or sublet all or any portion of the Demised Premises then, notwithstanding that Tenant shall not have obtained a proposed assignee or subtenant, Tenant shall give written notice ("Tenant's Notice") of such desire to Landlord, setting forth the desired effective date of such assignment or the desired commencement and expiration dates of such subletting, the area to be sublet, the consideration or rent to be payable under such desired assignment or subletting, as the case may be, and other economic terms and conditions of the desired assignment or subletting. In such event, Tenant agrees to use as its exclusive rental agent for such purpose, for a period of ninety (90) days (and thereafter on a non-exclusive basis), the then designated leasing agent of the Building and to notify such leasing agent of its desire to assign this Lease or sublet the Demised Premises.

Landlord shall have the following options to be exercised within thirty (30) days from receipt of Tenant's Notice:

1. If an assignment shall be proposed or if such

subletting shall be for all or substantially all of the Demised Premises, Landlord shall have the option to cancel and terminate this Lease as of the date proposed by Tenant for such assignment or subletting.

2. If a proposed sublease shall be for less than all or substantially all of the Demised Premises or if it shall be for less than the balance of the Term granted hereunder, Landlord shall have the option to terminate this Lease as to the portion of the Demised Premises proposed to be sublet and for such portion of the Term as is included in such proposed sublease, to take effect as of the effective date thereof. In the event of the exercise of such option under this subparagraph 2, the rent and all other charges payable hereunder shall be equitably apportioned, and Tenant shall be responsible for the cost of constructing any necessary demising walls.

3. Landlord shall have the option to require Tenant to execute an assignment or sublease to Landlord, or to any party designated by Landlord, containing the same terms and conditions as with the proposed assignee or subtenant, except that (A) the assignee or sublessee shall have an express unlimited right to assign or sublease to others, and make any alterations required in connection therewith, and (B) the rent or consideration payable under said assignment or sublease to Landlord or Landlord's designee shall be the lower of (i) the rental payable by Tenant to Landlord under this Lease or (ii) the rental payable by the proposed assignee or subtenant pursuant to the proposed assignment or subletting.

Landlord hereby agrees that the foregoing options 2 and 3 shall not apply to a sublease or subleases which, together with any other subleases then in existence, shall be less than twenty (20%) percent of the Demised Premises. If Landlord shall not exercise any of its foregoing options within the time set forth above, or if the foregoing options shall not apply to the proposed transaction, then, upon Tenant obtaining a specific assignee or sublessee within six (6) months of the date of Tenant's Notice, upon substantially similar terms as set forth in Tenant's Notice or terms which are more favorable to Tenant, Tenant shall submit to Landlord in writing (1) the name of the proposed assignee or subtenant; (2) the terms and conditions of the proposed assignment or subletting; (3) the nature and character of the business of the proposed assignee or subtenant and any other information reasonably requested by Landlord. Provided Tenant shall not be in default hereunder, and the proposed assignment or sublease conforms with the conditions specified in the preceding sentence, Landlord's consent to any such proposed assignment or subletting shall not be "unreasonably" withheld or delayed, as described in paragraph (b) of this
Section 11.01. Landlord agrees that it shall respond to any request for consent to Tenant's proposed assignment or sublease within twenty (20) days after receipt of all information and documents relevant thereto and if Landlord shall fail to so respond within said thirty (30) days, Landlord shall be deemed to have consented to Tenant's proposed assignment, sublease or occupancy, provided that Tenant's request for consent contains a legend in bold typeface to the effect that Landlord's failure to respond within said thirty (30) days shall be deemed Landlord's consent. If Tenant fails to obtain a specific assignee or sublessee within said six (6) month period or fails to consummate any proposed assignment or subletting to which Landlord shall have consented within one hundred eighty (180) days after granting such consent, paragraph (a) shall again apply to said proposed assignment or subletting.

If Landlord shall not exercise any of the options described in paragraph (a) above and Tenant shall thereupon assign this Lease or sublet all or any portion of the Demised Premises, then and in that event, Tenant shall pay to Landlord, as additional rent, fifty (50%) percent of the excess, if any, of the Fixed Rent plus additional rent paid by the assignee or sublessee to Tenant over the Fixed Rent plus additional rent allocable to that part of the Demised Premises affected by such assignment or sublease pursuant to the provisions of this Lease, such excess, if any, to be reduced by the actual reasonable expenses incurred by Tenant in connection with such assignment or subletting, including, without limitation, brokerage commissions (if applicable) but not in excess of one and one half commissions, the cost of physically separating the sublet area (if applicable) from the rest of the Demised Premises and other related construction expenses actually incurred in connection with preparing the space for occupancy by the sublessee, free rent and reasonable legal expenses. Such additional rent payments shall be made monthly within five (5) days after receipt of the same by Tenant. Fifty (50%) percent of any cash or other consideration payable to Tenant in connection with such assignment or sublease or the sale of Tenant's property in connection therewith (less in the case of the sale thereof the fair market value of such personal property, as reasonably determined by Landlord), shall be similarly paid over to Landlord when and as received by Tenant.

If Tenant fails to consummate any proposed assignment or subletting to which Landlord shall have consented within sixty (60) days after granting such consent, paragraph (a) shall again apply to said proposed assignment or subletting.

No option exercised by Landlord pursuant to the provisions of paragraph (a), and no assignment or sublease made to Landlord under the provisions of paragraph (a), shall be binding upon any purchaser of any ground or underlying lease who acquires such ground or underlying lease by reason of the foreclosure of any mortgage to which this Lease is subordinate, nor upon any assignee of any ground or underlying lease who takes such assignment in lieu of such foreclosure, it being understood, however, that such purchaser or assignee may, at its option, elect to enforce such option, assignment or sublease.

(b) In determining reasonableness, Landlord may take into consideration all relevant factors surrounding the proposed sublease or assignment, including, without limitation, the following:

(i) the financial stability and business reputation of the proposed assignee or subtenant;

(ii) the nature of the business and the proposed use of the Demised Premises by the proposed assignee or subtenant

in relation to the majority of other tenants in the Building;

(iii) the proposed assignee or subtenant shall not be a tenant of other space in the Building or a party which has dealt with Landlord or Landlord's agent (directly or through a broker) with respect to space in the Building during the six (6) months immediately preceding Tenant's request for Landlord's consent, provided Landlord has comparable space in the Building for such proposed assignee or subtenant;

(iv) restrictions contained in leases of other tenants of the Building;

(v) the effect that the proposed assignee's or subtenant's occupancy or use of the Demised Premises would have upon the operation and maintenance of the Building and Landlord's investment therein;

(vi) not more than two entities (excluding, Tenant and any Related Entities (as hereinafter defined)) shall occupy the Demised Premises at any time.

Section 11.02. If this Lease shall be assigned, or if the Demised Premises or any part thereof be sublet or occupied by any person or persons other than Tenant, Landlord may after default by Tenant, collect rent from the assignee, subtenant or occupant and apply the net amount collected to the rent herein reserved, but no such assignment, subletting, occupancy or collection of rent shall be deemed a waiver of the covenants in this Article, nor shall it be deemed acceptance of the assignee, subtenant or occupant as a tenant, or a release of Tenant from the full performance by Tenant of all the terms, conditions and covenants of this Lease.

Section 11.03. Each assignee or transferee shall assume and be deemed to have assumed this Lease and shall be and remain liable jointly and severally with Tenant for the payment of the rent, additional rent and adjustments of rent, and for the due performance of all the terms, covenants, conditions and agreements herein contained on Tenant's part to be performed for the Term of this Lease. No assignment shall be binding on Landlord unless such assignee or Tenant shall deliver to Landlord a duplicate original of the instrument of assignment which contains a covenant of assumption by the assignee of all of the obligations aforesaid and shall obtain from Landlord the aforesaid written consent prior thereto.

Section 11.04. For the purposes of this Lease, any sale, transfer or assignment of the majority stock of a corporate Tenant (other than a sale of shares of a corporate tenant the shares of which are listed on a registered securities exchange or are regularly traded in the "over-the-counter market" provided such sale is effectuated on such exchange or in such market) or

any transfer in the control of Tenant by operation of law or otherwise shall be deemed an assignment. Notwithstanding the foregoing, the sale, transfer or assignment of the majority of the stock of Tenant pursuant to a public or private offering or pursuant to any corporate restructuring shall not be deemed an assignment, provided that the same is not done to circumvent the prohibition contained herein.

Section 11.05. The listing of any name other than that of Tenant, whether on the doors of the Demised Premises, on the Building directory or otherwise, shall not operate to vest any right or interest in this Lease or the Demised Premises. It is expressly understood that any such listing is a privilege extended by Landlord that is revocable at will by written notice to Tenant.

Section 11.06. Tenant shall reimburse Landlord for any costs incurred by Landlord to review the requested consent provided in Article 11, including reasonable attorneys' fees.

Section 11.07. If Landlord shall recover or come into possession of the Demised Premises before the Expiration Date, Landlord shall have the right to take over any sublease made by Tenant and to succeed to all rights of Tenant thereunder, Tenant hereby assigning (effective as of the date of Landlord's succession of Tenant's estate in the Demised Premises) such subleases as Landlord may elect to take over. Every subletting hereunder shall be subject to the condition that, from and after the termination of this Lease or re-entry by Landlord hereunder or other succession by Landlord to Tenant's estate in the Demised Premises, the subtenant shall waive any right to surrender possession or to terminate the sublease and, at Landlord's election, shall be bound to Landlord for the balance of the term thereof and shall attorn to and recognize Landlord, as its landlord, under all of the then executory terms of such sublease, except that Landlord shall not be (a) liable for any previous act, omission or negligence of Tenant under such sublease, (b) subject to any counterclaim, defense or offset theretofore accruing to such subtenant against Tenant, (c) bound by any previous modification or amendment of such sublease made without Landlord's consent or by any previous prepayment of more than one month's rent and additional rent unless paid as provided in the sublease, or (d) obligated to perform any repairs or other work in the subleased space or the Building beyond Landlord's obligations under this Lease, and each subtenant shall execute and deliver such instruments as Landlord may reasonably request to evidence and confirm such attornment.

Section 11.08. Notwithstanding anything to the contrary elsewhere contained herein (including Section 11.01(a) hereof and Landlord's rights thereunder to profit sharing), provided that Tenant shall not be in monetary default or material non-monetary default in any of the terms of this Lease beyond

notice and the expiration of any applicable grace period, Tenant may, without Landlord's consent but upon not less than ten (10) days' prior written notice to Landlord, sublet to, or allow occupancy by, any corporations or other business entities which control, are controlled by, or are under common control with Tenant (herein referred to as a "Related Entity") all or part of the Demised Premises or permit any Related Entity to occupy the same for any of the purposes permitted to Tenant, subject however to compliance with Tenant's obligations under this Lease. Such subletting or occupancy shall not be deemed to vest in any such Related Entity any right or interest in this Lease nor shall such subletting or occupancy relieve, release, impair or discharge any of Tenant's obligations hereunder. Tenant shall deliver to Landlord a copy of any such sublease or occupancy agreement for all or any portion of the Demised Premises. Landlord hereby acknowledges and agrees that the following Related Entities may occupy the Demised Premises but only for so long as such entities shall continue to remain Related Entities of Tenant: (i) Taxi Tops Inc. (d/b/a Medallion Taxi Media), (ii) Edwards Capital Corp., (iii) Transportation Capital Corp., (iv) Medallion Funding Corp., and (iv) Business Lenders LLC.

Section ll.09. Notwithstanding anything to the contrary elsewhere contained herein (including Section 11.01(a), which shall not be applicable to an assignment or transfer pursuant to this Section 11.09), Tenant may, upon prior written notice to Landlord, assign or transfer its entire interest in this Lease and the leasehold estate hereby created to a "Successor Corporation" (as such term is hereinafter defined) of Tenant, provided that Tenant shall not be in monetary default or material non-monetary default in any of the terms of this Lease beyond notice and the expiration of any applicable grace period. A "Successor Corporation", as used in this Section, shall mean
(a) a corporation into which or with which Tenant, its corporate successors or permitted assigns, is merged or consolidated, in accordance with applicable statutory provisions for the merger or consolidation of a corporation, provided that by operation of law or by effective provisions contained in the instruments of merger or consolidation, the liabilities of the corporations participating in such merger or consolidation are assumed by the corporation surviving such merger or consolidation, or (b) a corporation, partnership or other business entity acquiring this Lease and the Term and the estate hereby granted, the goodwill and all or substantially all of the other property and assets (other than capital stock of such acquired corporation) of Tenant, its corporate successors or permitted assigns, its corporate successors or permitted assigns, or (c) any corporate successor to a Successor Corporation becoming such by either of the methods described in subdivisions (a) and (b) above, provided that, (x) immediately after giving effect to any such merger or consolidation, or such acquisition and assumption, as the case may be, the corporation, partnership or other business entity surviving such merger or created by such consolidation or

acquiring such assets and assuming such liabilities, as the case may be, shall have a net worth, as determined in accordance with generally accepted accounting principles, at least equal to the greater of (i) the net worth, similarly determined, of Tenant, immediately prior to such merger or consolidation or such acquisition and assumption, as the case may be, or (ii) the net worth, similarly determined, of Tenant as of the date of this Lease and (y) proof of such net worth, as evidenced by a statement from a certified public accounting firm reasonably satisfactory to Landlord shall have been delivered to Landlord at least ten (10) days prior to the effective date of any such merger or consolidation, or acquisition and assumption, as the case may be. Upon the compliance with the foregoing provisions of this Section 11.09, and the delivery to Landlord of the agreement of the Successor Corporation, in form and substance reasonably satisfactory to Landlord, to assume all the terms of this Lease to be performed by Tenant, and to be bound thereby, the corporation, partnership or other business entity so assigning or transferring this Lease shall thereafter be released and discharged from any obligations thereafter arising under this Lease.

ARTICLE 12.

Section 12.01. Landlord or its agents shall not be liable for any damage to property of Tenant or of others entrusted to employees of the Building, nor for the loss of or damage to any property of Tenant by theft or otherwise. Landlord or its agents shall not be liable for any injury or damage to persons or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water, rain or snow, leaks from any part of the Building or from the pipes, appliances or plumbing works or from the roof, street or sub-surface or from any other place or by dampness or by any other cause of whatsoever nature, unless caused by or due to the negligence or willful misconduct of Landlord, its agents, servants or employees; nor shall Landlord or its agents be liable for any such damage caused by other tenants or persons in the Building or caused by operations in construction of any private, public or quasi-public work; nor shall Landlord be liable for any latent defect in the Demised Premises or in the Building of which they form a part. If at any time any windows of the Demised Premises are temporarily or permanently closed, darkened or bricked up for any reason whatsoever including but not limited to Landlord's own acts, Landlord shall not be liable for any damage Tenant may sustain thereby, and Tenant shall not be entitled to any compensation therefor nor abatement of rent nor shall the same release Tenant from its obligations hereunder nor constitute an eviction. Tenant shall reimburse and compensate Landlord as additional rent within five (5) days after rendition of a

statement for all expenditures made by, or damages or fines sustained or incurred by, Landlord due to non-performance or non-compliance with or breach or failure to observe any term, covenant or condition of this Lease upon Tenant's part to be kept, observed, performed or complied with. Tenant shall give immediate notice to Landlord in case of fire or accidents in the Demised Premises or in the Building or of defects therein or in any fixtures or equipment.

ARTICLE 13.

Section 13.01. Tenant shall not move any safe, heavy equipment or bulky matter in or out of the Building without Landlord's written consent, which consent Landlord agrees not unreasonably to withhold or delay. If the movement of such items requires special handling, Tenant agrees to employ only persons holding a Master Rigger's License to do said work and all such work shall be done in full compliance with the Administrative Code of the City of New York and other municipal requirements. All such movements shall be made during hours which will least interfere with the normal operations of the Building, and all damage caused by such movement shall be promptly repaired by Tenant at Tenant's expense.

ARTICLE 14.

Section 14.01. In the event that the whole of the Demised Premises shall be lawfully condemned or taken in any manner for any public or quasi-public use, this Lease and the Term and estate hereby granted shall forthwith cease and terminate as of the date of vesting of title. In the event that only a part of the Demised Premises shall be so condemned or taken, then, effective as of the date of vesting of title, the rent hereunder for such part shall be abated. In the event that only a part of the Building shall be so condemned or taken, then (a) if substantial structural alteration or reconstruction of the Building shall in the reasonable opinion of Landlord be necessary or appropriate as a result of such condemnation or taking (whether or not the Demised Premises be affected), Landlord may, at its option, terminate this Lease and the Term and estate hereby granted as of the date of such vesting of title by notifying Tenant in writing of such termination within sixty (60) days following the date on which Landlord shall have received notice of vesting of title, or (b) if Landlord does not elect to terminate this Lease, as aforesaid, this Lease shall be and remain unaffected by such condemnation or taking, except that the Fixed Rent shall be abated to the extent, if any, hereinbefore provided in this Article 14. In the event that only a part of the Demised Premises shall be so condemned or taken and this Lease and the Term and estate hereby granted are not terminated as hereinbefore provided, Landlord will, at its expense, restore with reasonable diligence the remaining structural portions of the Demised Premises as nearly as practicable to the same condition as it was prior to such condemnation or taking.

In the event of termination in any of the cases hereinabove provided, this Lease and the Term and estate hereby granted shall expire as of the date of such termination with the same effect as if that were the date hereinbefore set for the expiration of the Term of this Lease, and the rent hereunder shall be apportioned as of such date.

In the event of any condemnation or taking hereinabove mentioned of all or a part of the Building, Landlord shall be entitled to receive the entire award in the condemnation proceeding, including any award made for the value of the estate vested by this Lease in Tenant, and Tenant hereby expressly assigns to Landlord any and all right, title and interest of Tenant now or hereafter arising in or to any such award or any part thereof, and Tenant shall be entitled to receive no part of such award. Tenant shall, at its own cost and expense, be entitled to pursue an independent claim for moving expenses, Tenant's property (which does not become part of the Building or property of Landlord) and injury to Tenant's business, provided,

however, that such claim shall not thereby lessen, reduce or otherwise affect Landlord's award.

ARTICLE 15.

Section 15.01. Tenant shall permit Landlord to erect, use and maintain pipes and conduits in and through the Demised Premises. In the event the construction deprives the Tenant of the use of a material or substantial area (other than on a temporary basis), Tenant shall be entitled to an abatement of rent for the space so permanently taken. Landlord or its agents or designees shall have the right, but only upon reasonable notice (except in emergencies, in which event no notice shall be required) given to Tenant or any authorized employee of Tenant at the Demised Premises, to enter the Demised Premises at reasonable times during business hours, for the purpose of making such repairs or alterations as Landlord shall be required or shall have the right to make by the provisions of this Lease and, subject to the foregoing, shall also have the right to enter the Demised Premises for the purpose of inspecting them or exhibiting them to prospective purchasers or lessees of the entire Building or to prospective mortgagees of the property of which the Demised Premises are a part. The holder of any mortgage of Landlord's interest in the property, its agents or designees shall also have such right of inspection for itself and for any prospective assignees of any such mortgagees. Landlord shall be allowed to take all material into and upon the Demised Premises that may be required for the repairs and alterations above mentioned without the same constituting an eviction of Tenant in whole or in part, and the rent reserved shall in no wise abate, except as otherwise provided in this Lease, while said repairs or alterations are being made, by reason of loss or interruption of the business of Tenant because of the prosecution of any such work, provided Landlord diligently proceeds therewith in such manner as to cause the least possible interference with the Tenant's use and enjoyment of the Demised Premises.

Section 15.02. During the twelve (12) months prior to the expiration of the Term of this Lease, Landlord may exhibit the Demised Premises to prospective tenants. Landlord shall also have the right to enter the Demised Premises for the purpose of inspecting the same or exhibiting the same to prospective purchasers or lessees of the entire Building or to prospective mortgagees of the property of which the Demised Premises forms a part. The holders of any mortgage of Landlord's interest in the property, or such holders' agent or designees, shall also have such right of inspection for itself and for any prospective assignees of any such mortgagees. Landlord agrees, to the extent practicable, to give Tenant reasonable prior notice of any exhibition or inspection pursuant to this Section 15.02 and to

perform any such exhibition or inspection at times reasonably convenient to Tenant and in a manner so as to minimize interference with Tenant's business. Landlord further agrees that, except in the event of an emergency, Landlord's exhibition or inspection of the Demised Premises shall be, to the extent practicable, in the company of a representative of Tenant.

Section 15.03. Landlord shall have the right at any time without thereby creating an actual or constructive eviction or incurring liability to Tenant therefor, to change the arrangement or location of such of the following as are not contained within the Demised Premises or any part thereof: entrances, passageways, elevators, doors and doorways, corridors, stairs, toilets and other like public service portions of the Building provided such changes do not unreasonably interfere with or materially adversely affect Tenant's access to and use of the Demised Premises.

ARTICLE 16.

Section 16.01. (a) Anything elsewhere in this Lease to the contrary notwithstanding, this Lease may be cancelled by Landlord by the sending of a written notice to Tenant within a reasonable time after the happening of any one or more of the following events: (i) Tenant shall (A) have applied for or consented to the appointment of a receiver, trustee, liquidator, or other custodian of Tenant or any of its properties or assets, (B) shall have taken any other action which could result in it becoming the subject of an insolvency or bankruptcy proceeding, (C)have made a general assignment for the benefit of creditors, (D)have commenced a voluntary case for relief as a debtor under the United States Bankruptcy Code or filed a petition to take advantage of any bankruptcy, reorganization, insolvency, readjustment of debts, dissolution or liquidation law or statute or an answer admitting the material allegations of a petition filed against it in any proceeding under any such law, or (E) be adjudicated a bankrupt or insolvent, or (ii) without the acquiescence or consent of Tenant an order, judgment or decree shall have been entered by any court of competent jurisdiction (a) approving as properly filed a petition seeking relief under the United States Bankruptcy Code or any bankruptcy, reorganization, insolvency, readjustment of debts, dissolution or liquidation law or statute with respect to Tenant or appointing a receiver, trustee, liquidator or other custodian of all or a substantial part of its properties or assets, and such order, judgment or decree shall have continued unstayed and in effect for any period of not less than ninety (90) days. Neither Tenant, nor any person claiming through or under Tenant or by reason of any statute or order of court, shall thereafter be entitled to possession of the Demised Premises, but shall forthwith quit and surrender the Demised Premises. If this Lease shall be assigned in accordance with its terms, the provisions of this Article shall be applicable only to the party then owning Tenant's interest in this Lease.

(b) It is stipulated and agreed that in the event of the termination of this Lease pursuant to (a) hereof, Landlord

shall forthwith, notwithstanding any other provisions of this Lease to the contrary, be entitled to recover from Tenant as and for liquidated damages an amount equal to the difference between the rent reserved hereunder for the unexpired portion of the Term demised and the then fair and reasonable rental value of the Demised Premises for the same period. In the computation of such damages the difference between any installment of rent becoming due hereunder after the date of termination and the fair and reasonable rental value of the Demised Premises for the period for which such installment was payable shall be discounted to the date of termination at the rate of four percent (4%) per annum. If the Demised Premises or any part thereof be re-let by Landlord for the unexpired Term of this Lease, or any part thereof, before the presentation of proof of such liquidated damages to any court, commission or tribunal, the amount of rent reserved upon such re-letting shall be prima facie evidence as to the fair and reasonable rental value for the part or the whole of the Demised Premises so re-let during the term of the re-letting. Nothing herein contained shall limit or prejudice the right of Landlord to prove for and obtain as liquidated damages by reason of such termination, an amount equal to the maximum allowed by any statute or rule of law in effect at the time when, and governing the proceedings in which, such damages are to be proved, whether or not such amount be greater, equal to, or less than the amount of the difference referred to above.

ARTICLE 17.

Section 17.01. (1) If (A) Tenant defaults in fulfilling any of the covenants of this Lease, (i) with respect to the covenant for the payment of rent or additional rent if such default shall continue for five (5) days, and (ii) with respect to any other covenants, if such default shall continue for twenty (20) days, in either event, after Landlord shall have given to Tenant a written notice specifying such default, or (B) the Demised Premises become vacant or deserted, or if the Demised Premises are damaged by reason of negligence or carelessness of Tenant, its agents, employees or invitees or (C) in the case of the happening of a default or omission (other than in the payment of Fixed Rent, additional rent or other charges hereunder and other than the failure to cause a lien against the Demised Premises, the Building or the Land to be discharged of record) which cannot with due diligence be completely cured or remedied within such twenty (20) day period, and if Tenant shall not have diligently commenced curing such default within such twenty (20) day period, and shall not thereafter with reasonable diligence and in good faith proceed to remedy or cure such default, then, in any such case Landlord may give to Tenant a notice of intention to terminate this Lease upon the expiration of three (3) days from the service of such notice of intention, and upon

the expiration of said three (3) days, this Lease and the Term hereof shall terminate, and Tenant shall then quit and surrender the Demised Premises to Landlord, but Tenant shall remain liable as hereinafter provided.

(2) If (A) the notice provided for in (1) hereof shall have been given, and the Term shall expire as aforesaid; or (B) if Tenant shall make a default in the payment of the rent reserved herein or any item of additional rent herein mentioned or any part of either or in making any other payment herein provided within the time period provided for in (1) above; or (C) if any execution or attachment shall be issued against Tenant or any of Tenant's property whereupon the Demised Premises shall be taken or occupied or attempted to be taken or occupied by someone other than Tenant; or (D) if Tenant shall fail to move into or take possession of the Demised Premises within ninety (90) days after commencement of the Term of this Lease, of which fact Landlord shall be the sole judge; then and in any of such events Landlord may without notice, re-enter the Demised Premises either by force or otherwise, and dispossess Tenant by summary proceedings or otherwise, and the legal representatives of Tenant or other occupant of the Demised Premises and remove their effects and hold the Demised Premises as if this Lease had not been made, and Tenant hereby waives the service of notice of intention to re-enter or to institute legal proceedings to that end. If Tenant shall make default hereunder prior to the date fixed as the commencement of any renewal or extension of this Lease, Landlord may cancel and terminate such renewal or extension agreement by written notice, but Tenant shall remain liable as hereinafter provided.

Section 17.02. In case of any such default, re-entry, expiration and/or dispossess by summary proceedings or otherwise, (i)the rent shall become due thereupon and be paid up to the time of such re-entry, dispossess and/or expiration together with such expenses as Landlord may incur for legal expenses, attorneys' fees, brokerage and/or putting the Demised Premises in good order, or for preparing the same for re-rental; (ii) Landlord may re-let the Demised Premises or any part or parts thereof, either in the name of Landlord or otherwise, for a term or terms, which may at Landlord's option be less than or exceed the period which would otherwise have constituted the balance of the Term of this Lease and may grant concessions or free rent; and/or (iii) Tenant or the legal representatives of Tenant shall also pay Landlord as liquidated damages for the failure of Tenant to observe and perform Tenant's covenants herein contained, at the election of Landlord, either:

(a) a sum which at the time of such termination of this Lease or at the time of any such re-entry by Landlord, as the case may be, represents the then value of the excess, if any, of (1) the aggregate of the installments of Fixed Rent and the additional rent

(if

any) which would have been payable hereunder by Tenant, had this Lease not so terminated, for the period commencing with such earlier termination of this Lease or the date of any such re-entry, as the case may be, and ending with the date hereinbefore set for the expiration of the full term hereby granted pursuant to Articles 1 and 2 hereof, over (2) the aggregate rental value of the Demised Premises for the same period, said lump sum to be discounted to the Expiration Date of this Lease at the then prevailing prime rate of interest; or

(b) sums equal to the aggregate of the installments of Fixed Rent and additional rent (if any) which would have been payable by Tenant had this Lease not so terminated, or had Landlord not so re-entered the Demised Premises, payable upon the due dates therefor specified herein following such termination or such re-entry and until the date hereinbefore set for the expiration of the full term hereby granted; provided, however, that if Landlord shall re-let the Demised Premises during said period, Landlord shall credit Tenant with the net rents received by Landlord for such re-letting, such net rents to be determined by first deducting from the gross rents as and when received by Landlord from such re-letting the expenses incurred or paid by Landlord terminating this Lease or of re-entering the Demised Premises and of securing possession thereof, including, without limitation, reasonable attorneys' fees and costs of removal and storage of Tenant's property, as well as the expenses of re-letting, including repairing, restoring, altering, decorating and preparing the Demised Premises for new tenants, brokers' commissions, advertising costs, attorneys' fees, and all other similar or dissimilar expenses chargeable against the Demised Premises and the rental therefrom in connection with such re-letting, it being understood that any such re-letting may be for a period equal to or shorter or longer than the remaining Term of this Lease; provided, further, that (i) in no event shall Tenant be entitled to receive any excess of such net rents over the sums payable by Tenant to Landlord hereunder, (ii) in no event shall Tenant be entitled in any suit for the collection of damages pursuant to this paragraph (b) to a credit in respect of any net rents from a re-letting except to the extent that such net rents are actually received by Landlord prior to the commencement of such suit, and (iii) if the Demised Premises or any part thereof should be re-let in combination with other space, then proper apportionment on a square foot area basis shall be made of the rent received from such re-letting and of the expenses of re-letting.

For the purpose of paragraph (a) of this Section 17.02, the amount of additional rent which would have been payable by Tenant under Article 3 hereof for each year, as therein provided, ending after such termination of this Lease or such re-entry, shall be deemed to be an amount equal to the amount of such additional rent payable by Tenant for the calendar year and Tax Year ending immediately preceding such termination of this Lease or such re-entry. Suit or suits for the recovery of such damages, or any installments thereof, may be brought by Landlord from time to time at its election, and nothing contained herein shall be deemed to require Landlord to postpone suit until the date when the Term of this Lease would have expired if it had not been terminated under the provisions of Articles 16 or 17 hereof, or under any provision of law, or had Landlord not re-entered the Demised Premises.

Landlord, at Landlord's option, may make such alterations, repairs, replacements and/or decorations in the Demised Premises as Landlord in Landlord's sole judgment considers advisable and necessary for the purpose of re-letting the Demised Premises; and the making of such alterations and/or decorations shall not operate or be construed to release Tenant from any liability hereunder as aforesaid. Landlord shall in no event be liable in any way whatsoever for failure to re-let the Demised Premises, or in the event that the Demised Premises are re-let, for failure to collect the rent thereof under such re-letting. In the event of a breach or threatened breach by Tenant of any of the covenants or provisions hereof, Landlord shall have the right of injunction and the right to invoke any remedy allowed at law or in equity as if re-entry, summary proceedings and other remedies were not herein provided for. Mention in this Lease of any particular remedy shall not preclude Landlord from any other remedy, in law or in equity. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being evicted or dispossessed for any cause, or in the event of Landlord obtaining possession of the Demised Premises, by reason of the violation by Tenant of any of the covenants and conditions of this Lease, or otherwise.

ARTICLE 18.

Section 18.01. If Tenant shall default in the observance or performance of any term or covenant on its part to be observed or performed under or by virtue of any of the terms or provisions in any Article of this Lease and such default shall continue beyond any applicable notice and cure period (provided, however, in the case of an emergency neither notice nor the expiration of any cure periods shall be necessary), Landlord,

without being under any obligation to do so and without thereby waiving such default, may remedy such default for the account and at the expense of Tenant. If Landlord makes any expenditures or incurs any obligations for the payment of money in connection therewith, including, but not limited to, attorneys' fees in instituting, prosecuting or defending any action or proceedings, such sums paid or obligations incurred with interest computed at the Interest Rate and costs shall be deemed to be additional rent hereunder and shall be paid to it by Tenant on demand.

ARTICLE 19.

Section 19.01. Landlord covenants that upon Tenant paying the rent and additional rents and observing and performing all the terms, covenants and provisions of this Lease on Tenant's part to be observed and performed, Tenant may peaceably and quietly enjoy the Demised Premises, subject nevertheless to the terms and conditions of this Lease.

ARTICLE 20.

Section 20.01. In the event that an excavation should be made for building or other purposes upon land adjacent to the Building, or should be authorized to be made, Tenant shall, if necessary, afford to the person or persons causing or authorized to cause such excavation, license to enter upon the Demised Premises for the purpose of doing such work as shall reasonably be necessary to protect or preserve the wall or walls of the Building, or the Building, from injury or damage and to support them by proper foundations, pinning and/or underpinning.

ARTICLE 21.

Section 21.01. So long as this Lease shall remain in full force and effect, Landlord shall, at its cost and expense:

(a) Provide necessary elevator facilities on Business Days from 8:00 A.M. to 6:00 P.M. and shall have sufficient elevators available at all other times. At Landlord's option, the elevators shall be operated by automatic control or by manual control, or by a combination of both of such methods. Subject to Landlord's security regulations, Tenant shall have access to the Demised Premises twenty-four (24) hours per day, seven (7) days per week. Landlord hereby agrees that there shall be no charge to Tenant for Tenant's use of the freight elevator

during Tenant's initial move into the Demised Premises.

(b) Maintain and keep in good order and repair the air-conditioning, heating and ventilating system installed by Landlord. The aforesaid systems will be operated by Landlord when seasonably required on Business Days, and shall be effective from 8:00 A.M. to 6:00 P.M. The air-conditioning, heating and ventilating system has been designed to maintain conditions pursuant to the New York State Energy Conservation Construction Code, effective January 1, 1979 and has been designed to maintain interior conditions of (i) 80 degrees F dry bulb and 50% max relative humidity when outside conditions are 95 degrees dry bulb and 75 degrees wet bulb, and (ii) 70 degrees F when outside conditions are 0 degrees F and will further provide fresh air in a quantity not less than 0.30 cu. ft. per minute per square foot of floor area. The above conditions are based upon the occupancy not exceeding one (1) person for each 100 square feet and a maximum connected electrical four (4) watts per square foot of usable area, of which a maximum of two (2) watts per square foot of usable area may be used for lighting. Landlord shall have no responsibility or liability for the ventilating conditions and/or temperature of the Demised Premises during the hours or days Landlord is not required to furnish heat, ventilation or air-conditioning pursuant to this paragraph. Landlord has informed Tenant that the windows of the Demised Premises and the Building may be sealed, and that the Demised Premises may become uninhabitable and the air therein may become unbreathable during the hours or days when Landlord is not required pursuant to this paragraph to furnish heat, ventilation or air- conditioning. Any use or occupancy of the Demised Premises during the hours or days Landlord is not so required to furnish heat, ventilation or air- conditioning to the Demised Premises shall be at the sole risk, responsibility and hazard of Tenant. Such condition of the Demised Premises shall not constitute nor be deemed to be a breach or a violation of this Lease or of any provision thereof, nor shall it be deemed an eviction nor shall Tenant claim or be entitled to claim any abatement of rent nor make any claim for any damages or compensation by reason of such condition of the Demised Premises. Tenant shall in any event cause all of the windows in the Demised Premises to be kept closed and shall cause and keep entirely unobstructed all of the vents, intakes, outlets and grilles, at all times and shall comply with and observe all regulations and requirements prescribed by Landlord for the proper functioning of the heating, ventilating and air-conditioning systems. In the event that Tenant shall require air-conditioning, heating or ventilation at such times as same are not furnished by Landlord, Tenant shall give Landlord at least twenty- four (24) hours advance notice of such requirement and, if same is furnished by Landlord, Tenant agrees to pay Landlord's charges therefor as additional rent.

(c) Provide cleaning and janitorial services on Business Days as described in Schedule E annexed hereto.

(d) Furnish hot and cold water for lavatory and drinking and office cleaning purposes. If Tenant requires, uses or consumes water for any other purposes, Tenant agrees to Landlord installing a meter or meters or other means to measure Tenant's water consumption, and Tenant further agrees to reimburse Landlord for the cost of the meter or meters and the installation thereof, and to pay for the maintenance of said meter equipment and/or to pay Landlord's cost of other means of measuring such water consumption by Tenant. Tenant shall reimburse Landlord the cost of all water consumed, as measured by said meter or meters or as otherwise measured, including sewer rents.

(e) Provide Tenant with seventeen (17) directory listings on the Building lobby directory, free of charge to Tenant. Landlord may make a reasonable charge for any changes to the directory listings.

Section 21.02. A. Landlord reserves the right to interrupt, curtail or suspend the services required to be furnished by Landlord under this Article 21 when the necessity therefor arises by reason of accident, emergency, mechanical breakdown, or when required by any law, order or regulation of any federal, state, county or municipal authority, or for any other cause beyond the reasonable control of Landlord. Landlord shall use due diligence to complete all required repairs or other necessary work as quickly as possible so that Tenant's inconvenience resulting therefrom may be for as short a period of time as circumstances will permit. No diminution or abatement of rent or other compensation shall or will be claimed by Tenant as a result therefrom, nor shall this Lease or any of the obligations of Tenant be affected or reduced by reason of such interruption, curtailment or suspension.

B. Notwithstanding the foregoing, in the event that as a result of such interruption, curtailment or suspension of services not necessitated by Tenant's acts and not occurring as a result of a requirement of law, Tenant shall be unable to conduct and shall actually discontinue conducting its normal business operations in the Demised Premises for a period of five (5) consecutive days or longer and shall notify Landlord of such discontinuance at the inception of such period (the "Inception Notice"), then Tenant shall be entitled to an abatement of the Fixed Rent and additional rent payable with respect to the Demised Premises for the period beginning on the day the Demised Premises were so rendered unusable for the conduct of Tenant's normal business operations (and such Inception Notice was given) and ending on the earlier of the date on which (a) Tenant resumes occupancy of the Demised Premises for the conduct of its business or (b) the Demised Premises are rendered usable for the conduct of Tenant's business operations (regardless of any delay by Tenant in thereafter resuming such

business operations).

Section 21.03. Tenant shall reimburse Landlord for the cost to Landlord of removal from the Demised Premises and the Building of so much of any refuse and rubbish of Tenant as shall exceed that ordinarily accumulated daily in the routine of business office occupancy or by any use of the Demised Premises after customary business hours.

Section 21.04. It is expressly agreed that only Landlord or any one or more persons, firms or corporations authorized in writing by Landlord will be permitted to furnish laundry, linen, towels, drinking water, ice and other similar supplies and services to tenants and licensees in the Building. Landlord may fix, in its sole and absolute discretion, at any time and from time to time, the hours during which and the regulations under which such supplies and services are to be furnished . Landlord expressly reserves the right to act as or to designate, at any time and from time to time, an exclusive supplier of all or any one or more of the said supplies and services, provided that the quality thereof and the charges therefor are reasonably comparable to that of other suppliers; and Landlord furthermore expressly reserves the right to exclude from the Building any person, firm or corporation attempting to furnish any of said supplies or services but not so designated by Landlord.

Section 21.05. It is expressly agreed that only Landlord or any one or more persons, firms or corporations authorized in writing by Landlord will be permitted to sell, deliver or furnish any food or beverages, either personally or through the use of vending machines, for consumption within the Demised Premises or elsewhere in the Building. Landlord expressly reserves the right to act as or to designate at any time, or from time to time, an exclusive supplier or suppliers of such food and beverages; and Landlord further expressly reserves the right to exclude from the Building any person, firm or corporation attempting to deliver or purvey any such food or beverages but not so designated by Landlord. It is understood, however, that Tenant or regular office employees of Tenant who are not employed by any supplier of such food or beverages or by any person, firm or corporation engaged in the business of purveying such food or

beverages, may personally bring food or beverages into the Building for consumption within the Demised Premises by employees of Tenant, but not for resale to or for consumption by any other tenant. Landlord may fix in its absolute discretion, at any time and from time to time, the hours during which, the regulations under which, foods and beverages may be brought into the Building by regular employees of Tenant. Notwithstanding the foregoing, it is understood that Tenant or regular office employees of Tenant who are not employed by any supplier of such food or beverages or by any person, firm or corporation engaged in the business of purveying such food or beverages, may personally bring food or beverages into the Building for consumption within the Demised Premises by employees of Tenant, but not for resale to or for consumption by any other tenant. It is further understood that Tenant may order food and beverages for delivery to Tenant in the Demised Premises for consumption by Tenant's employees and invitees from contractors, restaurants and caterers selected by Tenant, without obtaining Landlord's prior consent, provided, however, that if Landlord determines that the delivery by any such contractor, restaurant or caterer poses a security risk to the Building personnel or to other tenants in the Building or otherwise causes a nuisance or disruption in the Building, Landlord may exclude same from the Building.

Section 21.06. Tenant agrees to employ such office maintenance contractor as Landlord may from time to time designate, for all waxing, polishing, lamp replacement, cleaning (other than those cleaning services Landlord is obligated to furnish) and the maintenance work in the Demised Premises, provided that the quality thereof and the charges therefor are reasonably comparable to that of other contractors. Tenant shall not employ any other contractor without Landlord's prior written consent, which shall not be unreasonably withheld.

Section 21.07. Landlord will not be required to furnish any other services, except as otherwise provided in this Lease.

Section 21.08. (a) Tenant, at its sole cost and expense, shall cause the Demised Premises to be exterminated on a monthly basis to the satisfaction of Landlord and shall for such purposes employ exterminators designated by Landlord.

(b) If Tenant shall have facilities on the Demised Premises for cooking, drinking, eating, washing and/or storage of food, or similar items, Tenant shall, on a weekly basis, cause the portion of the Demised Premises on which such facilities are located to be exterminated to the satisfaction of Landlord by exterminators designated by Landlord. The foregoing shall not, however, constitute any approval or consent to the use of the Demised Premises for such purposes.

If Tenant fails to comply with the provisions of this Section 21.08, Landlord, in addition to any other remedies available to it under this Lease or pursuant to law, may, after five (5) days prior written notice, perform such service, and the cost therefor shall be paid by Tenant on demand as additional rent hereunder.

ARTICLE 22.

Section 22.01. The term "Landlord" wherever used in this Lease shall be limited to mean and include only the owner or owners at the time in question of the Land and the Building or the Building or the tenant under a ground or underlying lease affecting the Land and the Building or the Building, or both, to whom this Lease may be assigned, or a mortgagee in possession, so that in the event of any sale, assignment or transfer of the Land and the Building or the Building, or of such ground or underlying lease, such owner, tenant under a ground lease or mortgagee in possession shall thereupon be released and discharged from all covenants, conditions and agreements of Landlord thereafter accruing hereunder; but such covenants, conditions and agreements shall be binding upon each new owner, tenant under a ground or underlying lease, or mortgagee in possession for the time being of the Land and the Building, until sold, assigned or transferred.

ARTICLE 23.

Section 23.01. If any term, covenant, condition or provision of this Lease or the application thereof to any circumstance or to any person, firm or corporation shall be invalid or unenforceable to any extent, the remaining terms, covenants, conditions and provisions of this Lease, or the application thereof to any circumstances or to any person, firm or corporation other than those as to which any term, covenant, condition or provision is held invalid or unenforceable, shall not be affected thereby and each remaining term, covenant, condition and provision of this Lease shall be valid and shall be enforceable to the fullest extent permitted by law.

ARTICLE 24.

Section 24.01. The parties hereto agree that SageGroupAssociates Inc. ("Sage") and Newmark Real Estate Co., Inc. ("Newmark") were the only brokers who negotiated and brought about this transaction. Landlord agrees to pay Sage a commission therefor as per separate agreement. On or before the date of this Lease, Landlord agrees to provide Tenant with a letter from Newmark stating that Newmark shall not look to Landlord or Tenant for a commission in connection with this transaction. On or before the date of this Lease, Landlord agrees to provide Tenant with a letter from The Galbreath Company L.P. ("Galbreath") stating that Galbreath shall not look to Landlord or Tenant for a commission in connection with this transaction. Tenant represents and warrants that it has not dealt with any broker other than Sage and Newmark and Tenant agrees to indemnify and save Landlord harmless from any claims made by any other brokers claiming to have dealt with Tenant. Landlord represents that it has not dealt with any broker other than Sage and Newmark, and Landlord agrees to indemnify and save Tenant harmless from any claims made by Sage and any other brokers claiming to have dealt with Landlord.

ARTICLE 25.

Section 25.01. This Lease is subject and subordinate to all ground or underlying leases and to all mortgages which may now or hereafter affect such leases or the Building of which the Demised Premises forms a part, and to all renewals, modifications, consolidations, replacements and extensions thereof. This clause shall be self-operative, and no further instrument of subordination shall be required by any mortgagee. In confirmation of such subordination, Tenant shall execute promptly any certificate that Landlord may request. Tenant hereby constitutes and appoints Landlord the Tenant's attorney-in-fact to execute any such certificate or certificates for and on behalf of Tenant.

Section 25.02. At the option of Landlord or any successor landlord or the holder of any mortgage affecting the Demised Premises, Tenant agrees that neither the cancellation nor termination of any ground or underlying lease to which this Lease is now or may hereafter become subject or subordinate, nor any foreclosure of a mortgage affecting said premises, nor the institution of any suit, action, summary or other proceeding against Landlord herein or any successor landlord, or any foreclosure proceeding brought by the holder of any such mortgage

to recover possession of such property, shall by operation of law or otherwise result in cancellation or termination of this Lease or the obligations of Tenant hereunder, and upon the request of any such landlord, successor landlord, or the holder of such mortgage, Tenant covenants and agrees to attorn to Landlord or to any successor to Landlord's interest in the Demised Premises, or to such holder of such mortgage or to the purchaser of the mortgaged premises in foreclosure.

Section 25.03. In the event of any act or omission by Landlord which would give Tenant the right to terminate this Lease or to claim a partial or total eviction, pursuant to the terms of this Lease, if any, Tenant will not exercise any such right until (i) it has given written notice of such act or omission to
(a) the holder of any first mortgage,

(b) the landlord under any ground or underlying lease to which this Lease is subject and subordinate, whose names and addresses shall previously have been furnished to Tenant, by delivering such notice of such act or omission addressed to such holders at the last address so furnished, and (ii) a reasonable period for remedying such act or omission shall have elapsed following such giving of notice during which such parties, or any of the parties, with reasonable diligence, following the giving of such notice, has not commenced and continued to remedy such act or omission or to cause the same to be remedied.

Section 25.04. If, in connection with obtaining financing, a banking, insurance or other recognized institutional lender shall request reasonable modifications in this Lease as a condition to such financing, Tenant will not unreasonably withhold, delay or defer its consent thereto, provided that such modifications do not, in Tenant's reasonable opinion, increase the obligations of Tenant hereunder or materially adversely affect the leasehold interest hereby created or Tenant's use and enjoyment of the Demised Premises.

Section 25.05. Landlord agrees to use commercially reasonable efforts to obtain from its current mortgagee for the benefit of Tenant a Subordination, Non-disturbance and Attornment Agreement ("SNDA") in such mortgagee's standard form, provided that Landlord shall have no liability whatsoever, and the obligations of the parties hereto shall not be affected in any manner whatsoever, if such mortgagee shall fail to deliver such agreement. Landlord agrees to use commercially reasonable efforts to obtain from any future mortgagee a SNDA in such future mortgagee's standard form, provided that Landlord shall have no liability whatsoever, and the obligations of the parties hereto shall not be affected in any manner whatsoever, if such future mortgagee shall fail to deliver such agreement. Landlord agrees

to deliver to Tenant, within thirty (30) days after the date hereof, a SNDA from the landlord under the ground lease to which this Lease is subordinate.

ARTICLE 26.

Section 26.01. Tenant agrees, at any time, and from time to time, upon not less than ten (10) days prior notice from Landlord, to execute, acknowledge and deliver to Landlord a statement in writing addressed to Landlord certifying that this Lease is unmodified and in full force and effect (or, if there have been modifications, that the same is in full force and effect as modified and stating the modifications), stating the dates to which the Fixed Rent, additional rental and other charges have been paid, and stating whether or not to the best knowledge of the signer of such certificate, there exists any default in the performance of any covenant, agreement, term, provision or condition contained in this Lease, and any claim or offset in favor of Tenant, and, if any, specifying each such default, claim or offset in favor of Tenant, and, if any, specifying each such default, claim or offset of which signer may have knowledge, it being intended that any such statement delivered pursuant hereto may be relied upon by Landlord and by any purchaser or prospective purchaser of the Building and/or the Land and by any mortgagee or prospective mortgagee of any mortgage affecting the Building and/or the Land, and by any landlord under a ground or underlying lease affecting the Land or the Building.

Section 26.02. Landlord agrees, at any time, and from time to time, upon not less than ten (10) days prior notice from Tenant, to execute, acknowledge and deliver to Tenant a statement in writing addressed to Tenant certifying that this Lease is unmodified and in full force and effect (or, if there have been modifications, that the same is in full force and effect as modified and stating the modifications), stating the dates to which the Fixed Rent, additional rent and other charges have been paid, and stating whether or not, to the best knowledge of the signer of such certificate for and on behalf of Landlord, there exists any default in the performance of any covenant, agreement, term, provision or condition contained in this Lease and, if any, specifying each such default of which such signer may have knowledge.

ARTICLE 27.

Section 27.01. Landlord and Tenant hereby waive, to

the extent such waiver is not prohibited by law, the right to a jury trial in any action, summary proceeding or legal proceeding between or among the parties hereto or their successors arising out of this Lease or Tenant's occupancy of the Demised Premises or Tenant's right to occupy the Demised Premises.

Section 27.02. Tenant hereby waives the right to interpose a counterclaim (other than a mandatory counterclaim) in any summary proceeding instituted by Landlord against Tenant or in any action instituted by Landlord for unpaid rent or additional rent under this Lease.

Section 27.03. Tenant hereby agrees that the existence of any legal proceeding arising under this Lease,or any judgment resulting therefrom, shall remain confidential and to that end shall not discuss with, or make public disclosure of, the same to the press, other tenants of the Building, or otherwise. The parties hereto understand and agree that the papers filed in the course of any such legal proceeding may be available to the public but this
Section 27.03 is understood by Tenant as a prohibition against any public discussion or disclosure of the same, including any response to any query from the press, other tenants of the Building or otherwise.

Section 27.04. A. In the event Tenant claims or asserts that Landlord has violated or failed to perform a covenant of Landlord not to unreasonably withhold or delay Landlord's consent or approval, or in any case where Landlord's reasonableness in exercising its judgment is in issue, Tenant's sole remedy shall be an action for specific performance, declaratory judgment or injunction, and in no event shall Tenant be entitled to any money damages for a breach of such covenant, and in no event shall Tenant claim or assert any claims in any money damages in any action or by way of set-off, defense or counterclaim, and Tenant hereby specifically waives the right to any money damages or other remedies.

B. In the event that Tenant shall request Landlord's consent under the terms of this Lease and Tenant believes that Landlord has unreasonably withheld or delayed the same, such dispute, but no other matter whatsoever (except for any other matter under this Lease for which arbitration is provided as the method of dispute resolution, in which event such matter shall be resolved in a separate arbitration proceeding), shall be resolved by arbitration in Manhattan by an arbitrator selected from the panel of retired judges maintained by Comprehensive Alternative Dispute Resolution Enterprises, Inc. ("CADRE"). If CADRE shall no longer exist or shall be unwilling or unable to act or if Tenant shall object to CADRE, such dispute shall be resolved by another reputable commercial arbitration company which has expedited arbitration procedures which meet the time frame set forth herein, as Landlord shall select (the "Company"), provided, however, that

Tenant may dispute Landlord's choice of the Company, in which event the parties shall mutually agree upon the Company, and if the parties shall be unable to agree upon the Company, the Company shall be appointed by any judge of a court of competent jurisdiction in the City of New York. Upon selection of the Company the parties agree that the balance of this Section 27.04B shall continue to apply with the substitution of the Company in lieu of CADRE. If Tenant so desires to submit such dispute to CADRE, Tenant shall notify Landlord of such desire, and within ten (10) Business Days thereafter, Tenant shall make such submission and deliver all applicable applications and documents to CADRE with a copy of the entire submission being delivered simultaneously to Landlord. The arbitration shall be conducted pursuant to the then existing rules, regulations, practices and procedures of CADRE and provided such rules so permit, within five (5) Business Days after Tenant's submission or application, the arbitration shall commence two (2) Business Days thereafter and shall be conducted for at least seven (7) hours on each Business Day thereafter until completion, each party having no more than a total of fifteen
(15) hours to present its case and to cross-examine or interrogate persons supplying information or documentation on behalf of the other party. If such rules do not permit such expedited procedure, then such rules of CADRE shall govern, it being the intent of the parties to conduct the arbitration in the most expeditious manner permitted by the rules. The arbitrator shall make a determination within five (5) Business Days after conclusion of the arbitration; such determination to be strictly limited to whether or not Landlord's failure to consent to any proposed assignment of this Lease or proposed sublease or occupancy of all or any portion of the Demised Premises or proposed Tenant Improvement, was reasonable. No monetary award shall be awarded as a result of any proceeding pursuant to this Section, Landlord's sole responsibility in the event of a negative determination being the requirement of granting its consent to Tenant's proposed request, except that the prevailing party shall have the right to be reimbursed for its reasonable fees and expenses within twenty (20) days after submission of a bill therefor to the losing party.

ARTICLE 28.

Section 28.01. Upon the expiration or other termination of the Term of this Lease, Tenant shall quit and surrender the Demised Premises in good order and condition, ordinary wear and tear and damage by fire or other casualty, the elements and any cause beyond Tenant's reasonable control excepted, and shall remove all its property therefrom, except as otherwise provided in this Lease. Tenant's obligation to observe or perform this covenant shall survive the expiration or other termination of the Term of this Lease.

Section 28.02. If at any time during the last month of the Term of this Lease, Tenant shall have removed all or substantially all of Tenant's property from the Demised Premises, Landlord may, and Tenant irrevocably grants to Landlord a license to, immediately enter and alter, renovate and redecorate the Demised Premises, without diminution or abatement of rent, or incurring liability to Tenant for any compensation, and such acts shall have no effect on this Lease.

Section 28.03. Tenant agrees it shall indemnify and save Landlord harmless against all costs, claims, loss or liability resulting from delay by Tenant in surrendering the Demised Premises upon expiration or sooner termination of the term of this Lease, including, without limitation, any claims made by any succeeding tenant founded on such delay. The parties recognize and agree that the damage to Landlord resulting from any failure by Tenant timely to surrender the Demised Premises will be substantial, will exceed the amount of monthly rent theretofore payable hereunder, and will be impossible of accurate measurement. Tenant, therefore, agrees that if possession of the Demised Premises is not surrendered to Landlord within two
(2) days after the date of the expiration or sooner termination of the Term of this Lease, then Tenant will pay Landlord as liquidated damages for each month and for each portion of any month during which Tenant holds over in the Demised Premises after expiration or sooner termination of the Term of this Lease, a sum equal to two (2) times the average rent and additional rent which was payable per month under this Lease during the six (6) month period preceding such expiration or termination of the Term of this Lease. The aforesaid obligations shall survive the expiration of sooner termination of the Term of this Lease.

ARTICLE 29.

Section 29.01. Tenant, its servants, employees, agents, visitors, and licensees shall observe faithfully and comply strictly with the rules and regulations set forth in Schedule C attached hereto and made a part hereof. Landlord shall have the right from time to time during the Term of this Lease to make reasonable changes in and additions to the rules thus set forth. Landlord agrees not to enforce the rules and regulations against Tenant in a discriminatory manner unless compliance is necessitated due to the manner in which Tenant uses and occupies the Demised Premises, or any act or omission by Tenant. In the event of a conflict between the terms and conditions of this Lease and the rules and regulations, the terms and conditions of the Lease shall prevail.

Section 29.02. Any failure by Landlord to enforce any

rules and regulations now or hereafter in effect, either against Tenant or any other tenant in the Building, shall not constitute a waiver of any such rules and regulations.

ARTICLE 30.

Section 30.01. Any notice, request or demand permitted or required to be given by the terms and provisions of this Lease, or by any law or governmental regulation, either by Landlord to Tenant or by Tenant to Landlord, shall be in writing. Unless otherwise required by such law or regulation, such notice, request or demand shall be given, and shall be deemed to have been served and given by Landlord and received by Tenant, when Landlord
(1) shall have deposited such notice, request or demand by registered or certified mail enclosed in a securely closed postpaid wrapper, in a United States Government general or branch post office, addressed to Tenant at the Demised Premises, and (2) until Tenant has moved its offices to the Demised Premises, shall have deposited such notice, request or demand by registered or certified mail enclosed in a securely closed postpaid wrapper in such a post office addressed to Tenant at its address as stated on the first page of this Lease. A copy of all notices to Tenant shall also be sent to Scott Mollen, Esq., c/o Graubard Mollen & Miller, 600 Third Avenue, New York, New York 10016. Such notice, request or demand shall be given, and shall be deemed to have been served and given by Tenant and received by Landlord, when Tenant shall have deposited such notice, request or demand by registered or certified mail enclosed in a securely closed postpaid wrapper in such a post office addressed to Landlord at 777 Third Avenue, New York, New York 10017. Either party may, by notice as aforesaid, designate a different address or addresses for notices, requests or demands to it.

ARTICLE 31.

Section 31.01. The failure of Landlord to seek redress for violation of, or to insist upon the strict performance of, any covenant or condition of this Lease, or any of the Rules and Regulations set forth or hereafter adopted by Landlord shall not prevent a subsequent act which would have originally constituted a violation from having all the force and effect of an original violation. The receipt by Landlord of rent with knowledge of the breach of any covenant of this Lease shall not be deemed a waiver of such breach. The failure of Landlord to enforce any of the Rules and Regulations set forth, or hereafter adopted, against Tenant and/or any other tenant in the Building shall not be deemed a waiver of any such Rules and

Regulations. No provision of this Lease shall be deemed to have been waived by Landlord, unless such waiver be in writing signed by Landlord. No payment by Tenant or receipt by Landlord of a lesser amount than the monthly rent herein stipulated shall be deemed to be other than on account of the earliest stipulated rent, nor shall any endorsement or statement on any check or any letter accompanying any check or payment as rent be deemed an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord's right to recover the balance of such rent or pursue any other remedy in this Lease provided.

Section 31.02. This Lease with the Schedules annexed hereto, if any, contains the entire agreement between Landlord and Tenant, and any executory agreement hereafter made between Landlord and Tenant shall be ineffective to change, modify, waive, release, discharge, terminate, or effect an abandonment of this Lease, in whole or in part, unless such executory agreement is in writing and signed by the party against which enforcement of the change, modification, waiver, release, discharge, termination or the effecting of the abandonment is sought.

ARTICLE 32.

Section 32.01. The captions of Articles in this Lease are inserted only as a matter of convenience and for reference, and they in no way define, limit or describe the scope of this Lease or the intent of any provision thereof.

ARTICLE 33.

Section 33.01. This Lease and the obligation of Tenant to pay rent hereunder and perform all of the other covenants and agreements hereunder on the part of Tenant to be performed shall in no way be affected, impaired or excused because Landlord is unable to fulfill any of its obligations under this Lease or to supply or is delayed in supplying any service expressly or impliedly to be supplied or is unable to make, or is delayed in making any repair, additions, alterations or decorations or is unable to supply or is delayed in supplying any equipment or fixtures if Landlord is prevented or delayed from so doing by reason of strike or labor troubles or any outside cause whatsoever including but not limited to, governmental preemption in connection with a National Emergency or by reason of any rule, order or regulation of any department or subdivision thereof of any government agency or by reason of the conditions of supply and demand which have been or are affected by war or other emergency.

Section 34.01. Landlord or Landlord's agents have made no representations or promises with respect to the Building, the Land or the Demised Premises except as herein expressly set forth, and no rights, easements or licenses are acquired by Tenant by implication or otherwise except as expressly set forth in the provisions of this Lease. The taking of possession of the Demised Premises by Tenant shall be conclusive evidence, as against Tenant, that Tenant accepts said premises and that the Demised Premises and the Building of which the same form a part were in good and satisfactory condition at the time such possession was so taken.

ARTICLE 35.

Section 35.01. The Building may be known as or by such name as Landlord, in its sole discretion, may elect, and Landlord shall have the right from time to time to change such designation or name without Tenant's consent.

ARTICLE 36.

Section 36.01. The covenants, conditions and agreements contained in this Lease shall bind and inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors and, except as otherwise provided herein, their assigns.

ARTICLE 37.

Section 37.01. If all or any part of the Fixed Rent or additional rents, as above defined, shall at any time become uncollectible, reduced or required to be refunded by virtue of any rules, regulations, orders, laws and ordinances (including, without limitation, rent control or stabilization laws), or governmental or quasi-governmental authorities having jurisdiction ("Laws and Ordinances"), then for the period prescribed by said Laws and Ordinances, Tenant shall pay to Landlord the maximum amounts permitted pursuant to said Laws and Ordinances. Upon the expiration of the applicable period of time during which such amounts shall be uncollectible, reduced or refunded, Tenant shall pay to Landlord as additional rent, within fifteen (15) days after demand, all such uncollected, reduced or refunded amounts that would have been payable for the period absent such Laws and Ordinances; provided, however, that the retroactive collection thereof shall then be lawful.

ARTICLE 38.

Section 38.01. Tenant hereby represents and warrants to Landlord that (1) Tenant is not an affiliate of JMB Institutional Realty Corporation; (2) Tenant (or any affiliate of Tenant) does not have, and during the one year period preceding the date that this Lease was entered into has not exercised, the authority to appoint or terminate JMB Institutional Realty Corporation as the Investment Manager of JMB Group Trust I, or to select or retain JMB Group Trust I as an investment vehicle for any trust participating therein.

Section 38.02. Tenant acknowledges that it has been informed that JMB Group Trust I is the owner of an interest in Landlord; that JMB Group Trust I is a group trust in which certain tax qualified employee benefit plans have made investments; and that under the Employee Retirement Income Security Act of 1974 ("ERISA") and the Internal Revenue Code ("IRC") the leasing of space in the Building to an entity related to an employee benefit plan that is an investor in JMB Group Trust I may, unless the representations made by Tenant are satisfied, constitute a "prohibited transaction" as defined in Section 406 of ERISA and Section 4975 of the IRC, resulting in, among other sanctions, an excise tax on Tenant. Tenant covenants and agrees to advise Landlord immediately in writing, of the occurrence of an event or circumstance of which Tenant becomes aware resulting in such "prohibited transaction" and agrees that if this Lease now or at any time in the future constitutes or results in any such "prohibited transaction", then, without limitation on its rights or remedies, Landlord will have the right to terminate this Lease at any time on not less than thirty (30) days written notice.

ARTICLE 39.

Section 39.01. Whenever any default by Tenant, beyond any applicable notice and cure period, causes Landlord to incur attorneys' fees and/or other costs or expenses, Tenant agrees that it shall pay and/or reimburse Landlord for such fees, costs or expenses promptly upon being billed therefor.

Section 39.02. If any monies owing by Tenant under this Lease are paid more than ten (10) days after the date such monies are payable pursuant to the provisions of this Lease, Tenant shall pay Landlord interest thereon, at the Interest Rate, for the period from the date such monies were originally payable to the date such monies are paid. In the event that three times

in any twelve (12) month period Tenant shall have defaulted beyond any applicable notice and cure period in the payment of Fixed Rent or additional rent, or any part of either, then any further default by Tenant within such twelve (12) month period shall permit Landlord to collect from Tenant, upon demand, in addition to any interest payable pursuant to this Article 38, or elsewhere in this Lease, a late charge equal to ten percent (10%) of the amount of Fixed Rent and additional rent so due as compensation to Landlord for the costs incurred by it as a result of such defaults, Landlord and Tenant acknowledging that the actual amount of such costs would be impossible to ascertain.

ARTICLE 40.

Section 40.01. Anything herein to the contrary notwithstanding, provided this Lease shall be in full force and effect and Tenant shall not be in default hereunder beyond any applicable notice and grace periods, the Fixed Rent shall abate at the rate of $50,291.67 per month
(pro-rated for any partial month) for a period of two (2) months and five (5)
days from and after the Commencement Date.

ARTICLE 41.

Section 41.02. If Tenant exercises its option to lease the Expansion Space in a timely manner, then on the date (the "Expansion Space Commencement Date") Landlord delivers possession of the Expansion Space to Tenant, the Expansion Space shall be added to the Demised Premises. Tenant acknowledges that it will take the Expansion Space "as-is", and Landlord shall not be obligated to perform any work, furnish any materials, or give Tenant any rent credit or work allowance or any sum of money with respect thereto, and the Expansion Space shall become part of the Demised Premises upon and subject to all of the terms and conditions of this Lease, except that the Fixed Rent payable by Tenant for the Expansion Space shall be equal to the greater of (i) the Fixed Rent then in effect from time to time for the Demised Premises (on a per square foot basis) including all escalations and additional rent payable as herein provided or (ii) the fair market rental value of the Expansion Space (the "Expansion FMRV"). The Expansion FMRV shall be determined in accordance with the following procedure:

(i) Immediately after the exercise by Tenant of its option contained herein, Landlord and Tenant shall use their best efforts to agree upon the Expansion FMRV. In the event Landlord and Tenant cannot reach agreement within fifteen (15) Business Days after the date of Tenant's notice of exercise of its option contained herein, Landlord and Tenant shall each select a reputable, licensed real estate broker having an office in New York County and familiar with the rentals then being charged in the Building and in comparable buildings (respectively, "Landlord's Broker" and "Tenant's Broker") who shall confer promptly after their selection by Landlord and Tenant and shall use their best efforts to agree upon the Expansion FMRV, taking into consideration all relevant factors (except as expressly excluded below), including, as a primary factor, the rental which Landlord is then commanding or requiring for leases of comparable space in the Building (or, if there is then no comparable space in the Building, taking into consideration the quality of non-comparable space in the Building relative to the Expansion Space) and including as a further factor the value of free rent concessions then being granted for leases with a term equal to the balance of the Term as of the Expansion Space Commencement Date and the fact that the base years for Real Estate Tax Adjustment and Operating Expense Adjustment under Article 3

of the Lease shall be the same for the Expansion Space as they are for the existing space, but specifically excluding as a factor the value of tenant improvement work or contributions. If Landlord's Broker and Tenant's Broker cannot reach agreement within forty-five
(45) days after the date of Tenant's notice of exercise of its option contained herein, then within ten (10) days thereafter, they shall designate a third reputable, licensed real estate broker having an office in New York County (the "Independent Broker"). Upon the failure of Landlord's Broker and Tenant's Broker to agree upon the designation of the Independent Broker, then the Independent Broker shall be appointed by a Justice of the Supreme Court of the State of New York upon ten (10) days notice, or by any other court in New York County having jurisdiction and exercising functions similar to those exercised by the Supreme Court of the State of New York. Concurrently with such appointment, Landlord's Broker and Tenant's Broker shall each submit a letter to the Independent Broker, with a copy to Landlord and Tenant, setting forth such broker's estimate of the Expansion FMRV, taking into consideration the factors described above (respectively, "Landlord's Broker's Letter" and "Tenant's Broker's Letter").

(ii) In the event the Expansion FMRV set forth in Landlord's Broker's Letter and Tenant's Broker's Letter shall differ by less than $2.50 per square foot for any year during the remainder of the Term, then the Expansion FMRV shall not be determined by the Independent Broker, and the Expansion FMRV shall be the average of the Expansion FMRV set forth in Landlord's Broker's Letter and Tenant's Broker's Letter. In the event the Expansion FMRV set forth in Landlord's Broker's Letter and Tenant's Broker's Letter shall differ by more than $2.49 per square foot per annum for any year during the remainder of the Term, the Independent Broker shall conduct such investigations and hearings as he may deem appropriate and shall, within sixty (60) days after the date of his designation, choose either the rental set forth in Landlord's Broker's Letter or Tenant's Broker's Letter to be the Expansion FMRV during the Term and such choice shall be binding upon Landlord and Tenant. Landlord and Tenant shall each pay the fees and expenses of its respective broker. The fees and expenses of the Independent Broker shall be shared equally by Landlord and Tenant.

Section 41.03. In the event the Fixed Rent for the Expansion Space shall not have been determined prior to the Expansion Space Commencement Date, then the Fixed Rent for the Expansion Space to be paid by Tenant to Landlord until such determination has been made shall be the Fixed Rent for the Demised Premises (on a per square foot basis) immediately preceding the Expansion Space Commencement Date, including all escalations or additional rent payable pursuant to Article 3 hereof or as otherwise provided herein. After such determination of the Fixed Rent for the Expansion Space has been made, any excess rental for the Expansion Space theretofore paid by Tenant to Landlord shall be credited by Landlord against the next ensuing monthly installments of Fixed Rent payable by Tenant to Landlord and any deficiency in Fixed Rent due from Tenant to Landlord attributable to the Expansion Space shall be immediately paid.

Section 41.04. Promptly after Tenant exercises its option to lease the Expansion Space and the Fixed Rent for the Expansion Space shall have been determined, Landlord and Tenant shall execute and deliver an agreement (i) incorporating the Expansion Space into the definition of the Demised Premises,
(ii) setting forth the Fixed Rent for the Expansion Space, (iii) amending
Section 3.04 to reflect the increase in the Percentage attributable to the Expansion Space and the increase in the Wage

Rate Factor attributable to the Expansion Space. In addition, if the Expansion Space shall be less than a full floor, the electricity for such Expansion Space may, at Landlord's option, be provided on a so called "rent inclusion" basis, in which event, with respect to the Expansion Space, Article 4 hereof shall not be applicable, and instead, Article 4 appearing in Schedule F annexed hereto and made a part hereof shall be applicable to the Expansion Space, and the Fixed Rent for the Expansion Space, shall be increased by a sum equal to $2.90 (as adjusted in accordance with Section 4.01 of said Schedule F) multiplied by the rentable square foot area of the Expansion Space. The failure of the parties to enter into such an agreement shall not affect their respective rights and obligations hereunder.

Section 41.05. Under no circumstances shall Landlord have any liability for the failure of any occupant of all or a portion of the Expansion Space to vacate same at the end of the term of such occupant's lease. Landlord agrees to take such actions as are reasonable, in its sole judgment, to obtain vacant possession of any such space at the end of such term provided Landlord's failure to deliver such possession to Tenant shall in no event affect the enforceability of this Lease.

ARTICLE 42.

Section 42.01. Provided this Lease shall then be in full force and effect and Tenant shall not be in default hereunder beyond any applicable notice or grace period either as of the date of Tenant's exercise of the extension option described herein or as of the day which would otherwise be the first day of the Extension Term, as defined herein (which conditions regarding default may be waived by Landlord in its sole discretion), Tenant shall have the right, at its option, to extend the Term for a single five (5) year period (the "Extension Term"). The Extension Term shall commence on the day immediately following the original Expiration Date and shall expire on the day prior to the fifth (5th) anniversary of such date unless the Extension Term shall sooner end pursuant to any of the terms, covenants or conditions of this Lease or pursuant to law. Tenant shall give Landlord written notice of Tenant's intention to exercise such option on or before the date which is nine
(9) months prior to the original Expiration Date, the time of exercise being of the essence, and upon the giving of such notice, this Lease and the Term shall be extended without execution or delivery of any other or further documents, with the same force and effect as if the Extension Term had originally been included in the Term and the Expiration Date shall thereupon be deemed to be the last day of the Extension Term. All of the terms, covenants and conditions of this Lease shall continue in

full force and effect during the Extension Term, including items of additional rent and escalation which shall remain payable on the terms herein set forth, except that the Fixed Rent shall be as determined in accordance with Section 42.02 of this Article and Tenant shall have no further right to extend the Term pursuant to this Article.

Section 42.02. The Fixed Rent payable by Tenant for the Demised Premises during the Extension Term shall be the greater of (i) the Fixed Rent then in effect, including all escalations and additional rent payable as herein provided, or (ii) the fair market rental value of the Demised Premises taking into consideration all relevant factors (except as expressly provided below), including, as a primary factor, the rental which Landlord is then commanding or requiring for comparable space in the Building (or, if there is then no comparable space in the Building, taking into consideration the quality of non-comparable space in the Building relative to the Demised Premises) and including as a further factor the value of free rent concessions then being granted for leases with a term equal to the Extension Term and the fact that the base years for Real Estate Tax Adjustment and Operating Expense Adjustment under Article 3 of the Lease shall be the same during the Extension Term as they are for the Term, but specifically excluding as a factor the value of tenant improvement work or contributions (fair market rental value taking into account the foregoing is hereinafter referred to as the "FMRV"). The FMRV shall be determined in accordance with the following procedure:

(i) Immediately after the exercise by Tenant of its option under Section 42.01 above, Landlord and Tenant shall use their best efforts to agree upon the FMRV. In the event Landlord and Tenant cannot reach agreement within fifteen (15) Business Days after the date of Tenant's notice of exercise of its option, Landlord and Tenant shall each select a reputable qualified, licensed real estate broker having an office in New York County and familiar with the rentals then being charged in the Building and in comparable buildings (respectively, "Landlord's Broker" and "Tenant's Broker") who shall confer promptly after their selection by Landlord and Tenant and shall use their best efforts to agree upon the FMRV. If Landlord's Broker and Tenant's Broker cannot reach agreement within sixty (60) days after the date of Tenant's notice of exercise of its option, then within ten (10) days thereafter, they shall designate a third reputable, licensed real estate broker having an office in New York County (the "Independent Broker"). Upon the failure of Landlord's Broker and Tenant's Broker to agree upon the designation of the Independent Broker, then the Independent Broker shall be appointed by a Justice of the Supreme Court of the State of New York

upon ten (10) days notice, or by any other court in New York County having jurisdiction and exercising functions similar to those exercised by the Supreme Court of the State of New York. Concurrently with such appointment, Landlord's Broker and Tenant's Broker shall each submit a letter to the Independent Broker, with a copy to Landlord and Tenant, setting forth such broker's estimate of the FMRV (respectively, Landlord's Broker's Letter" and "Tenant's Broker's Letter").

(ii) In the event the FMRV set forth in Landlord's Broker's Letter and Tenant's Broker's Letter shall differ by less than $2.50 per square foot for each year during the Extension Term, then the FMRV shall not be determined by the Independent Broker, and the FMRV shall be the average of the FMRV set forth in Landlord's Broker's Letter and Tenant's Broker's Letter. In the event the FMRV set forth in Landlord's Broker's Letter and Tenant's Broker's Letter shall differ by more than $2.49 per square foot per annum for any year during the Extension Term, the Independent Broker shall conduct such investigations and hearings as he may deem appropriate and shall, within sixty (60) days after the date of his designation, choose either the rental set forth in Landlord's Broker's Letter or Tenant's Broker's Letter to be the FMRV during the Extension Term and such choice shall be binding upon Landlord and Tenant. Landlord and Tenant shall each pay the fees and expenses of its respective broker. The fees and expenses of the Independent Broker shall be shared equally by Landlord and Tenant.

Section 42.03. In the event the Extension Term shall commence prior to determination of the Fixed Rent during the Extension Term as herein provided, then the Fixed Rent to be paid by Tenant to Landlord until such determination has been made shall be the Fixed Rent for the twelve (12) month period immediately preceding the commencement of the Extension Term, including all escalations or additional rent payable pursuant to Article 3 hereof or as otherwise provided herein. After such determination has been made for the Fixed Rent during the Extension Term, any excess rental for the Extension Term theretofore paid by Tenant to Landlord shall be credited by Landlord against the next ensuing monthly Fixed Rent payable by Tenant to Landlord and any deficiency in Fixed Rent due from Tenant to Landlord during the Extension Term shall be immediately paid.

Section 42.04. Promptly after the Fixed Rent has been determined, Landlord and Tenant shall execute and deliver an agreement setting forth the Fixed Rent for the Extension Term, as finally determined, provided the failure of the parties to do so shall not affect their respective rights and obligations

hereunder.

IN WITNESS WHEREOF, Landlord and Tenant have respectively executed this Lease as of the day and year first above written.

SAGE REALTY CORPORATION, AS AGENT
FOR MADISON AVENUE LEASEHOLD LLC

STATE OF NEW YORK    )
                     )   SS.:
COUNTY OF NEW YORK   )


            On the     day of              , 1997, before me personally
                              -------------

STATE OF NEW YORK    )
                     )   SS.:
COUNTY OF NEW YORK   )


            On the      day of              , 1997, before me
                               -------------
personally came                , to me known, who being by me duly sworn,
                ---------------

SCHEDULE "A"

INTENTIONALLY OMITTED

SCHEDULE "B"

SCHEDULE "C"

1. The rights of tenants in the entrances, corridors, elevators and escalators of the Building are limited to ingress to and egress from the tenants' premises for the tenants and their employees, licensees and invitees, and no tenant shall use, or permit the use of, the entrances, corridors, escalators or elevators for any other purpose. No bicycles, dogs or other animals may be brought into the Building by Tenant, or its employees, licensees or invitees. No tenant shall invite to the tenant's premises, or permit the visit of, persons in such numbers or under such conditions as to interfere with the use and enjoyment of any of the plazas, entrances, corridors, escalators, elevators and other facilities of the Building by other tenants. Tenant shall not use or permit its employees to use the elevators before 10:00 A.M. in a "Down" direction for purposes of taking a coffee break or similar activities. Fire exits and stairways are for emergency use only, and they shall not be used for any other purposes by the tenants, their employees, licensees or invitees. No tenant shall encumber or obstruct, or permit the encumbrance or obstruction of, any of the sidewalks, plazas, entrances, corridors, escalators, elevators, fire exits or stairways of the Building. Landlord reserves the right to control and operate the public portions of the Building and the public facilities, as well as facilities furnished for the common use of the tenants, in such manner as it deems best for the benefit of the tenants generally.

2. The cost of repairing any damage to the public portions of the Building or the public facilities or to any facilities used in common with other tenants, caused by a tenant or the employees, licensees or invitees of the tenant, shall be paid by such tenant.

3. Landlord may refuse admission to the Building outside of ordinary business hours to any person not known to the watchman in charge or not having a pass issued by Landlord or not properly identified, and may require all persons admitted to or leaving the Building outside of ordinary business hours to register. Tenant's employees, agents and visitors shall be permitted to enter and leave the Building whenever appropriate arrangements have been previously made between Landlord and Tenant with respect thereto. Each tenant shall be responsible for all persons for whom he requests such permission and shall be liable to Landlord for all acts of such persons. Any person whose presence in the Building at any time shall, in the judgment of Landlord, be prejudicial to the safety, character, reputation and interests of the Building or its tenants may be denied access to the Building or may be ejected therefrom. In case of invasion, riot, public excitement or other commotion, Landlord may prevent all access to the Building during the continuance of the same, by closing the doors or otherwise,

for the safety of the tenants and protection of property in the Building. Landlord may require any person leaving the Building with any package or other object to exhibit a pass from the tenant from whose premises the package or object is being removed, but the establishment and enforcement, or failure to enforce, of such requirements shall not impose any responsibility on Landlord for the protection of any tenant against the removal of property from the premises of the tenant. Landlord shall, in no way, be liable to any tenant for damages or loss arising from the admission, exclusion or ejection of any person to or from the tenant's premises or the Building under the provisions of this rule.

4. No tenant shall obtain or accept or use in its premises ice, drinking water, food, beverage, towel, barbering, boot blacking, floor polishing, lighting maintenance, cleaning or other similar services from any persons not authorized by Landlord in writing to furnish such services, provided always that the charges for such services by persons authorized by Landlord are not excessive. Such services shall be furnished only at such hours, in such places within the tenant's premises and under such regulations as may be fixed by Landlord.

5. No awnings or other projections over or around the windows shall be installed by any tenant and only such window blinds as are supplied, or permitted by Landlord shall be used in a tenant's premises.

6. There shall not be used in any space, or in the public halls of the Building, either by Tenant or by jobbers or others, in the delivery or receipt of merchandise or mail, any hand trucks, except those equipped with rubber tires and side guards.

7. All entrance doors in each tenant's premises shall be left locked when the tenant's premises are not in use. Entrance doors shall not be left open at any time. All windows in each tenant's premises shall be kept closed at all times, and all blinds or drapes therein above the ground floor shall be lowered or closed when and as reasonably required because of the position of the sun, during the operation of the Building air conditioning system to cool or ventilate the tenant's premises.

8. No noise, including the playing of any musical instruments, radio or television, which, in the judgment of Landlord, might disturb other tenants in the Building shall be made or permitted by any tenant and no cooking shall be done in Tenant's premises except as expressly approved by Landlord. Nothing shall be done or permitted in any tenant's premises and nothing shall be brought into or kept in any tenant's premises which would impair or interfere with any of the Building services or the proper and economic heating, cleaning or other servicing of the Building or the premises, or the use or enjoyment by any other tenant of any other premises, nor shall there be installed by any tenant any ventilating, air conditioning, electrical or other

equipment of any kind which, in the judgment of Landlord, might cause any such impairment or interference. No dangerous, inflammable, combustible or explosive object or material shall be brought into the Building by any tenant or with the permission of any tenant.

9. Tenant shall not permit any cooking or food odors emanating from the Demised Premises to seep into other portions of the Building.

10. No acids, vapors or other materials shall be discharged or permitted to be discharged into the waste lines, vents or flues of the Building which may damage them. The water and wash closets and other plumbing fixtures in or serving any tenant's premises shall not be used for any purpose other than the purpose for which they were designed or constructed, and no sweepings, rubbish, rags, acids or other foreign substances shall be deposited therein. All damages resulting from any misuse of the fixtures shall be borne by the tenant who, or whose servants, employees, agents, visitors or licensees, shall have caused the same.

11. No signs, advertisement, notice or other lettering shall be exhibited, inscribed, painted or affixed by any tenant on any part of the outside or inside the premises or the Building without the prior written consent of Landlord. In the event of the violation of the foregoing by any tenant, Landlord may remove the same without any liability, and may charge the expense incurred by such removal to the tenant or tenants violating this rule. Interior signs and lettering on doors and elevators shall be inscribed, painted, or affixed for each tenant by Landlord at the expense of such tenant, and shall be of a size, color and style acceptable to Landlord. Landlord shall have the right to prohibit any advertising by any tenant which impairs the reputation of the Building or its desirability as a building for offices, and upon written notice from Landlord, Tenant shall refrain from or discontinue such advertising.

12. No additional locks or bolts of any kind shall be placed upon any of the doors or windows in any tenant's premises, and no lock on any door therein shall be changed or altered in any respect. Duplicate keys for a tenant's premises and toilet rooms shall be procured only from Landlord, which may make a reasonable charge therefor. Upon the termination of a tenant's lease, all keys to the tenant's premises and toilet rooms shall be delivered to Landlord.

13. No tenant shall mark, paint, drill into, or in any way deface any part of the Building or the premises demised to such tenant. Not boring, cutting or stringing of wires shall be permitted, except with the prior written consent of Landlord, and as Landlord may direct. Not tenant shall install any resilient tile or similar floor covering in the premises demised to such tenant except in a manner approved by Landlord.

14. No tenant shall use or occupy, or permit any portion of the premises demised to such tenant to be used or occupied, as an office for a public stenographer or typist, or as a barber or manicure shop, or as an employment bureau. No tenant or occupant shall engage or pay any employees in the Building, except those actually working for such tenant or occupant in the Building or advertise for laborers giving an address at the Building.

15. No premises shall be used, or permitted to be used, at any time, as a store for the sale or display of goods or merchandise or any king, or as a restaurant, shop, booth, bootblack or other stand, or for the conduct of any business or occupation which involves direct patronage of the general public on the premises demised to such tenant, or for manufacturing or for other similar purposes.

16. The requirements of tenants will be attended to only upon application at the office of the Building. Employees of Landlord shall not perform any work or do anything outside for the regular duties, unless under special instructions from the office of the Landlord.

17. Each tenant shall, at its expense, provide artificial light in the premised demised to such tenant for Landlord's agents, contractors and employees while performing janitorial or other cleaning services and making repairs or alterations in said premises.

18. Employees of Tenant shall not loiter around the hallways, stairways, elevators, front, roof or any other part of the Building used in common by the occupants thereof.

19. Any cuspidors or similar containers or receptacles used in the Demised Premises shall be cared for and cleaned by and at the expense of Tenant.

20. Any and all wet and/or food garbage, including coffee grinds, is to be deposited in a plastic liner bag in a waste basket or other receptacle.

21. Tenant shall separate all refuse and rubbish of Tenant in accordance with the methods and procedures set forth, from time to time, by Landlord.

SCHEDULE "D"

SEE ATTACHED

SCHEDULE "E"

I. GENERAL CLEANING AND JANITORIAL SPECIFICATIONS

A. DAILY SERVICES

1. Empty and clean interiors and exteriors of receptacles and places for disposal.

2. Empty and clean all ash trays and receptacles.

3. Clean cigarette urns and replace sand and/or water as necessary.

4. Hand dust all office furniture, fixtures and window sills. If textolite or similar desk tops are used, they are to be wiped with a damp cloth.

5. Dust all moldings, door louvers, ventilating louvers within reach, ledges, radiators, chair rails, baseboards and trim, damp dusting where necessary.

6. Dust under all desk equipment and damp dust all telephone equipment, excluding all electronic desk machines (e.g., Computer terminals and screens, copiers and faxes).

7. Wash clean all water coolers and fountains.

8. Wipe clean all chrome, aluminum and other metal work and enamel and mail chutes.

9. Unwaxed flooring, excluding wood, marble, terazzo or carpet, used as corridors adjacent to the core shall be cleaned and mopped. This excludes full floor tenants who must maintain their corridor.

10. Damp wash blackboards unless marked "save".

11. Keep supply closets and slop sinks clean and orderly.

12. Store cleaning equipment in designated areas.

13. Sweep all floors.

14. All tenant kitchen areas are excluded from all cleaning services.

B. WEEKLY SERVICES

Wipe clean all brass and other bright work. Refinishing and polishing special metal surfaces are the responsibility of the tenant.

C. QUARTERLY SERVICES "HIGH DUSTING"

1. Dust, while in place, all pictures, frames, charts, graphs and similar wall hangings not reached in nightly cleaning, as necessary.

2. Dust and clean all vertical surfaces, such as walls, partitions, doors, door bucks, venetian blinds and other surfaces not reached in nightly cleaning, as necessary. This excludes interior glass partitions located in tenant areas.

3. Dust all books while in place in libraries, as necessary.

4. Dust all door louvers and other ventilating louvers, grills, etc., as necessary.

5. Clean all pipes and other horizontal surfaces not reached in nightly cleaning, as necessary. This excludes interior glass partitions located in tenant areas.

6. Dust all lighting fixtures, globes, files and open shelves.

7. Dust all closet shelving and damp mop closet tile floors.

D. ANNUAL SERVICES

1. Clean all stairwell walls.

2. Dust ceiling surfaces, other than acoustical ceiling materials, and vacuum clean only acoustical material and other similar surfaces. Wash ceiling areas around air-diffuser, if requested.

II. RESTROOMS

With respect to the Building core restrooms only, which excludes private or executive bathrooms, Contractors shall:

A. NIGHTLY SERVICES

1. Mop, rinse and dry floors; polish mirrors and glass shelves, clean enameled surfaces.

2. Wash basins, urinals and bowls using non-abrasive cleaner of the bacterial disinfectant type in cold water, remove stains and making certain to clean under sides of rim of urinals and bowls.

3. Wash both sides of all toilet seats with bacterial disinfectant type cleaner in cold water.

4. Damp wipe walls and wash the tile wall near urinals with a disinfectant.

5. Polish flushometers, piping, toilet seat hinges and other metal if not clean and bright.

6. Fill and maintain mechanical operation of all toilet tissue, soap and sanitary napkin dispensers. The Landlord shall be responsible for the cost of mechanical repairs. The cost of hand towels and soap are the responsibility of the tenant. The Landlord pays for toilet paper.

7. All waste paper cans and sanitary disposal receptacles are to be emptied and thoroughly cleaned and washed, as necessary.

8. Scrub floors as necessary.

9. Private and executive restrooms are excluded from all nightly service.

10. All supplies are excluded from private and executive restrooms.

B. MONTHLY SERVICES

Wash down wall in washrooms and stalls as needed from trim to floor. This excludes private and executive restrooms.

III. FLOORS

With respect to the Building, Contractor shall:

A. NIGHTLY CLEANING

1. Sweep all floors.

2. Sweep, wet mop with a detergent and rise all VCT floors.

3. Landlord will maintain surfaces in all public corridors of split tenant floors. Full floors are the responsibility of the tenant.

4. Vacuum carpets in passenger elevators. Clean and vacuum all elevator saddles and tracks in all floors.

5. Remove gum and foreign matter from all floors as necessary.

B. WEEKLY CLEANING

1. Sweep stairs in fire stairwats and dust handrails.

2. Dust all brass and other bright work. Refinishing or polishing metal or chrome are excluded.

3. Vacuuming of carpet floors:

(a) Vacuum clean all carpets once weekly in tenant areas.

(b) Use a heavy-duty machine with an adjustable height "beater bar" or "beater brush".

(c) Carpet sweep as necessary.

(d) Brush or dust by hand carpet edges inaccessible to high pressure vacuum attachments as required.

(e) Clean under furniture that can be moved.

(f) DRAPERIES REQUIRE A HAND-TYPE VACUUM ATTACHMENT TO REMOVE ACCUMULATED DUST.

IV. GLASS

1. The cleaning of interior glass partitions is the responsibility of the tenant.

2. Window cleaning, other than interior glass partitions, shall be in accordance with the existing or future schedule established at the building. The Landlord is responsible for the cost of this service.

SCHEDULE "F"

Section 4.01. The Fixed Rent reserved in this Lease includes the agreed sum of [$2.90 x the rentable square foot area of the Expansion Space], in consideration of which Landlord, as an additional service, will supply Tenant with electricity for normal use in the Demised Premises between the hours 9:00
A.M. and 5:30 P.M. on Business Days. If Landlord's electric rates (i.e., the public utility rate schedule at the time in question, including all surcharges, taxes, fuel adjustments, taxes regularly passed on to consumers by the public utility, and other sums payable in respect thereof for the supply of electric energy to Landlord for the Building) are increased, the Fixed Rent reserved in this Lease shall be adjusted by applying to the sum specified above, the same percentage as such rate increase, and such adjusted Fixed Rent shall be billed by Landlord to Tenant, with effect as of the date of the increase of Landlord's electric rate. If Tenant disputes the amount, Tenant shall nevertheless pay the same as billed, and the amount shall be determined by an independent utility consultant to be selected by Landlord and paid by Tenant. The determination of the consultant shall be binding upon the parties. Landlord shall not be liable in any way to Tenant for any failure or defect in the supply or character of electric energy furnished to the Demised Premises by reason of any requirement, act or omission of the public utility serving the Building with electricity or for any other reason not attributable to Landlord. At Landlord's option, Tenant shall purchase from Landlord or Landlord's agent all lighting tubes, lamps, bulbs and ballasts used in the Demised Premises, and Tenant shall pay Landlord's reasonable charges for providing and installing same on demand, as additional rent.

Section 4.02. Tenant's use of electric energy in the Demised Premises shall not at any time exceed the capacity of any of the electrical conductors, machinery and equipment in or otherwise serving the Demised Premises. In order to insure that such capacity is not exceeded and to avert possible adverse effect upon the Building electric service, Tenant shall not, without Landlord's prior written consent in each instance, connect any additional fixtures, machinery, appliances or equipment to the Building electric distribution system or make any alteration or addition to Tenant's machinery, appliances or equipment, or the electric system of the Demised Premises existing on the Commencement Date. Should Landlord grant such consent, all additional risers or other equipment required therefor shall be provided by Landlord, and the cost thereof shall be paid by Tenant upon Landlord's demand. As a condition to granting such consent, Landlord may require Tenant to agree to an increase in the Fixed Rent by an amount which will reflect the value to Tenant of the additional service to be furnished by Landlord, that is, the

potential additional electrical energy to be made available to Tenant based upon the estimated additional capacity of such additional risers or other equipment. If Landlord and Tenant cannot agree thereon, Tenant shall nevertheless pay the same as billed until such amount shall be determined by an independent utility consultant to be selected by Landlord and paid by Tenant. When the amount of such increase is so determined, the parties shall execute an agreement supplementary hereto to reflect such increase in the amount of the Fixed Rent stated in this Lease and in the amount set forth in Section 4.01, effective from the date such additional service is made available to Tenant, but such increase shall be effective from such date even if such supplementary agreement is not executed.

Section 4.03. If there shall be an increase in the space constituting the Demised Premises, or if Tenant's failure to maintain its machinery and equipment in good order and repair causes greater consumption of electrical current, or if Tenant uses electricity on days or hours other than those specified in Section 4.01, or if Tenant adds any machinery, appliances or equipment requiring additional electrical current, the Fixed Rent herein reserved shall be increased accordingly. The amount thereof shall be billed by Landlord to Tenant, effective as of the date of the increased usage. Such sum shall be due, and shall be paid by Tenant, as additional rent hereunder at the time billed. If Tenant disputes the amount, Tenant shall nevertheless pay the same as billed, and the amount shall be determined by an independent utility consultant to be selected by Landlord and paid by Tenant. The determination of the consultant shall be binding upon the parties.

Section 4.04. Landlord reserves the right to discontinue furnishing electric energy to Tenant in the Demised Premises at any time upon not less than thirty (30) days' notice to Tenant. If Landlord exercises such right of termination, this Lease shall continue in full force and effect and shall be unaffected thereby, except only that, from and after the effective date of such termination, Landlord shall not be obligated to furnish electric energy to Tenant and the Fixed Rent under this Lease shall be reduced by the amount set forth in Section 4.01, plus or minus the amount of any change pursuant to Sections 4.01, 4.02, 4.03 and 4.05. If Landlord so discontinues furnishing electric energy to Tenant, Tenant shall arrange to obtain electric energy directly from the public utility company furnishing electric service to the Building. Such electric energy may be furnished to Tenant by means of the then existing building system feeders, risers and wiring to the extent that the same are available, suitable and safe for such purposes. All meters and additional panel boards, feeders, risers, wiring and other conductors and equipment which may be required to obtain electric energy directly from such public utility company shall be installed and maintained by Tenant at its expense.

Section 4.05. Tenant covenants and agrees that at no time will the connected electrical load serving the Demised Premises exceed 5 watts per square foot. Should Landlord consent to an increase in the connected electrical load, as a condition to granting such consent, Landlord may require Tenant to agree to an increase in the Fixed Rent by an amount which will reflect the value to Tenant of the additional connected electrical load. The determination of the consultant shall be binding upon the parties.

Section 4.06. If any tax is imposed upon Landlord with respect to electrical energy furnished as a service to Tenant by any Federal, State or Municipal Authority, Tenant covenants and agrees that where permitted by law or applicable regulations, Tenant's pro rata share of such taxes shall be reimbursed by Tenant to Landlord.

Section 4.07. Landlord shall have the right to procure periodic surveys made by an independent utility consultant selected by Landlord and if such utility consultant determines that there has been (i) an increase in Tenant's use of electrical current or (ii) the amount set forth in Section 4.01 is insufficient, then, the amount set forth in Section 4.01 shall be adjusted and in addition to the other requirements and obligations imposed on Tenant in this Article, Tenant shall pay the fees of the utility consultant making such survey. The findings of such utility consultant shall be binding and conclusive on the parties.

Section 4.08. Notwithstanding the aforesaid provisions of this Article, if, pursuant to an action of the Public Service Commission of the State of New York, or otherwise, submetering of electricity is permitted at the Building, then Landlord shall have the option, at Landlord's sole cost and expense, of installing submeters to measure Tenant's electricity consumption. Upon installation of the submeters, Tenant's electricity consumption and demand shall be measured by said submeters, and Tenant agrees to purchase such electricity from Landlord or Landlord's designated agent at Landlord's electric rates, plus twelve (12%) percent thereof to reimburse Landlord for administrative services in connection with supplying and billing such electricity and two and one-half percent (2 1/2%) for line loss. All such sums shall be paid by Tenant to Landlord as additional rent hereunder. If more than one meter measures the electricity consumption and demand of Tenant in the Building, the service rendered through each meter shall be aggregated and billed in accordance with the above rate classification, unless Landlord shall elect separate billing on a per-meter basis. Landlord may at any time render bills for Tenant's consumption and demand and Tenant shall pay the same within thirty (30) days following the date the same are rendered. If Landlord exercises such right of submetering, this Lease shall continue in full force and effect and shall be unaffected thereby, except only that, from and after the effective date of such submetering, the Fixed Rent under this Lease shall be reduced by the amount set forth in Section 4.01, plus or minus the

amount of any change pursuant to Sections 4.01, 4.02, 4.03 and 4.05, and Tenant

EXHIBIT 10.65
AMD1217

Third Amendment, dated December 22, 1997, to Letter Agreement dated as of
December 1, 1996 between MEDALLION FINANCIAL CORP. and FLEET BANK, NATIONAL ASSOCIATION.

WHEREAS, the Borrower and the Bank are parties to a Letter Agreement dated as of December 1, 1996, as amended by the Letter Agreement, dated as of February 10, 1997, between the Borrower and the Bank, as further amended by the Letter Agreement, dated as of April 7, 1997, between the Borrower and the Bank (as so amended, the "Agreement"); and

WHEREAS, the Borrower has requested that the Bank amend, and the Bank has agreed to amend, certain provisions of the Agreement.

NOW, THEREFORE, the parties hereto hereby agree as follows:

1. The Agreement is hereby amended to provide that, subject to the Borrowing Base requirements set forth in Section 1 of the Agreement, for a period of four (4) months, commencing December 22, 1997, the maximum aggregate principal amount of Loans available to Borrower under the Line shall be increased from $7,500,000 to $25,000,000; provided, however, that on April 22, 1998 and at all times thereafter, the maximum aggregate principal amount of Loans available to Borrower under the Line shall be reduced again to $7,500,000. Accordingly, for the four month period set forth above, but for that period only, the amount "$7,500,00" contained in the opening paragraph of the Agreement and in Section 1 thereof is replaced with the amount "$25,000,000."

2. To the extent that on April 22, 1998 the aggregate amount of outstanding Loans exceeds $7,500,000, the Borrower shall immediately pay to the Bank the amount of such excess, which payment shall be applied against the outstanding principal balance of the Note evidencing the Loans.

3. The Borrower hereby represents and warrants to the Bank that:

(a) Each and every of the representations and warranties set forth in the Agreement and the Note (as defined in the Agreement) is true as of the date hereof and with the same effect as though made on the date hereof, and is hereby incorporated herein in full by reference as if fully restated herein in its entirety.

(b) No default or Event of Default (as defined under the Note) and no event or condition which, with the giving of notice or lapse of time or both, would constitute such a default or Event of Default, now exists or would exist.

4. All capitalized terms used herein, unless otherwise defined herein, have the same meanings provided therefor in the Agreement.

5. The amendments set forth herein are limited precisely as written and shall not be deemed to (a) be a consent to or a waiver of any other term or condition of the Agreement or any of the documents referred to therein or (b) prejudice any right or rights which the Bank may now have or may have in the future under or in connection with the Agreement or any documents referred to therein. Whenever the Agreement is referred to in the Agreement or any of the instruments, agreements or other documents or papers executed and delivered in connection therewith, it shall be deemed to mean the Agreement as further modified by this Amendment Number 3.

6. The Borrower shall execute and deliver concurrently herewith Endorsement No. 3 to teh Revolving Credit Note. Such Endorsement Number 3 shall be in the form of Exhibit A annexed hereto and be deemed, together with the Note to which it shall be attached, as such Note has been previously amended, collectively the Note for all purposes of the Agreement and documents relating thereto for the periods referenced therein.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment Number 3 to be duly executed and delivered by their respective duly authorized officers as of the date first above written.

MEDALLION FINANCIAL CORPORATION

By: /s/ Daniel F. Baker
    ---------------------------
Name: Daniel F. Baker
Title: Treasurer and Chief
        Financial Officer

FLEET BANK, NATIONAL ASSOCIATION

By: /s/ Andrea Lee
    ---------------------------
Name: Andrea Lee
Title: Vice President

EXHIBIT 10.66

Dated as of December 1, 1996, from MEDALLION FINANCIAL CORP. payable to FLEET BANK, N.A. by Endorsement No. 1 thereto dated February 10, 1997 and as further amended by Endorsement No. 2 thereto dated April 7, 1997 (as so amended, the "Note"), to which this Endorsement Number 3 is attached, hereby agree as follows:

1. The Note is hereby amended as follows:

(a) For the period commencing December 22, 1997, all references in the Note to the amount "$7,500,000 " or "SEVEN MILLION FIVE HUNDRED THOUSAND DOLLARS ($7,500,000)" shall be amended to read "$25,000,000" or "TWENTY FIVE MILLION DOLLARS ($25,000,000)"; provided, however, that on April 22, 1998 and at all times thereafter, all references in the Note to the amount "25,000,000" or "TWENTY FIVE MILLION DOLLARS ($25,000,000)" shall be amended to read "SEVEN MILLION FIVE HUNDRED THOUSAND DOLLARS" or "($7,500,000)".

(b) The rate of interest for a Eurodollar Loan (as defined in the Note) shall be amended such that the phrase "a fixed rate of 1.30% plus the Eurodollar Rate" shall be replaced with the phrase "a fixed rate of 1.10% plus the Eurodollar Rate".

(c) Paragraph 11 is amended by adding a new subparagraph (e) as follows:

(e) acquire, by purchase or otherwise, the business or assets of, or stock of, another business entity (each an "Acquisition") if the acquisition price, inclusive of (i) any indebtedness incurred in connection therewith, (ii) the assumption of any indebtedness, and (iii) any deferred purchase price on account thereof, exceeds $1,000,000 with respect to any individual Acquisition or $1,000,000 with respect to all such Acquisitions in the aggregate.

2. To the extent that on April 22, 1998 the outstanding principal balance of this Note exceeds $7,500,000, the Borrower shall immediately pay to the Bank the amount of such

excess, which payment shall be applied against the outstanding principal balance of this Note.

Except as expressly amended by this Endorsement Number 3, all the terms and conditions of the Note to which this Endorsement Number 3 is attached shall continue in full force and effect.

This Endorsement Number 3 shall be effective December 22, 1997.

MEDALLION FINANCIAL CORPORATION

By: /s/ Daniel F. Baker
    ---------------------------
Name: Daniel F. Baker
Title: Treasurer and Chief
        Financial Officer

FLEET BANK, N.A.

By: /s/ Andrea Lee
    ---------------------------
Name: Andrea Lee
Title: Vice President