EXHIBIT 10-1 BUSINESS LOAN AND SECURITY AGREEMENT

                                                   EXHIBIT 10-1

                    BUSINESS LOAN AND SECURITY AGREEMENT
                    ------------------------------------

       THIS BUSINESS LOAN AND SECURITY AGREEMENT (this "Agreement") is made
this 26th day of August, 2009, by and among VSE CORPORATION, a corporation
organized under the laws of the State of Delaware ("VSE"), ENERGETICS
INCORPORATED, a corporation organized under the laws of the State of Maryland
("Energetics"), VSE SERVICES INTERNATIONAL, INC., a corporation organized
under the laws of the State of Delaware ("VSI"), INTEGRATED CONCEPTS AND
RESEARCH CORPORATION, a corporation organized under the laws of the District
of Columbia ("ICRC"), G&B SOLUTIONS, INC., a corporation organized under the
laws of the Commonwealth of Virginia ("G&B"), jointly and severally (each of
VSE, Energetics, VSI, ICRC and G&B, a "Borrower"; and collectively, the
"Borrowers"), CITIZENS BANK OF PENNSYLVANIA, a bank chartered in the
Commonwealth of Pennsylvania, its successors and assigns ("Citizens"),
SUNTRUST BANK, a banking corporation organized under the laws of the State of
Georgia, its successors and assigns ("SunTrust"), each other financial
institution which is a party to this Agreement, whether by execution of this
Agreement or otherwise (collectively, the "Lenders" and individually, a
"Lender") and CITIZENS BANK OF PENNSYLVANIA, a bank chartered in the
Commonwealth of Pennsylvania, its successors and assigns, in its capacity as
both collateral and administrative agent for the Lenders (the "Agent").

                                  RECITALS
                                  --------
              A.  The Borrowers have applied to the Lender for a revolving
credit facility in the maximum principal amount of Fifty Million Dollars
($50,000,000).
              B.  Lenders severally are willing to make the revolving
credit facility available jointly and severally to Borrowers upon the terms and
subject to the conditions set forth in this Agreement.

                                 AGREEMENTS
                                 ----------
       NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
parties hereby agree as follows:

                                  ARTICLE I
                                 DEFINITIONS
                                 -----------

       Section 1.1      Certain Defined Terms.
                        ----------------------
       As used in this Agreement, the terms defined in the Preamble and
Recitals hereto shall have the respective meanings specified therein, and the
following terms shall have the following meanings:

       "Account" individually and "Accounts" collectively mean all presently
existing or hereafter acquired or created accounts, accounts receivable,
health care insurance receivables, contract rights, notes, drafts,
instruments, acceptances, chattel paper, leases and writings evidencing a
monetary obligation or a security interest in, or a lease of, goods, all
rights to receive the payment of a monetary obligation or other consideration
under present or future contracts (including, without limitation, all rights
(whether or not earned by performance) to receive payments under presently
existing or hereafter acquired or created letters of credit), or by virtue of
property that has been sold, leased, licensed, assigned or otherwise disposed
of, services rendered or to be rendered, loans and advances made or other
considerations given, by or set forth in or arising out of any present or
future chattel paper, note, draft, lease, acceptance, writing, bond,
insurance policy, instrument, document or general intangible, and all
extensions and renewals of any thereof, all rights under or arising out of
present or future contracts, agreements or general interest in goods which
gave rise to any or all of the foregoing, including all commercial tort
claims, other claims or causes of action now existing or hereafter arising in
connection with or under any agreement or document or by operation of law or
otherwise, all collateral security of any kind (including, without
limitation, real property mortgages and deeds of trust), Supporting
Obligations, letter of credit rights and letters of credit given by any
Person with respect to any of the foregoing, all books and records in
whatever media (paper, electronic or otherwise) recorded or stored, with
respect to any or all of the foregoing and all equipment and general
intangibles necessary or beneficial to retain, access and/or process the
information contained in those books and records, and all Proceeds (cash and
non-cash) of the foregoing.

       "Account Debtor" means any Person who is obligated on a Receivable and
"Account Debtors" mean all Persons who are obligated on the Receivables.

       "ACH Settlement Risk Reserve" means any and all reserves which the
Agent from time to time establishes, in its sole discretion, with respect to
ACH Transactions.

       "ACH Transactions" means any cash management or related services by the
Agent for the account of any of the Borrowers pursuant to agreement or
overdrafts.

       "Additional Borrower" means each Person that has executed and delivered
an Additional Borrower Joinder Supplement that has been accepted and approved
by the Agent.

       "Additional Borrower Joinder Supplement" means an Additional Borrower
Joinder Supplement in substantially the form attached hereto as Exhibit A,
with the blanks appropriately completed and executed and delivered by the
Additional Borrower and accepted by VSE on behalf of the Borrowers.

       "Affiliate" means, with respect to any designated Person, any other
Person, (a) directly or indirectly controlling, directly or indirectly
controlled by, or under direct or indirect common control with the Person
designated, (b) directly or indirectly owning or holding five percent (5%) or
more of any equity interest in such designated Person, or (c) five percent
(5%) or more of whose stock or other equity interest is directly or
indirectly owned or held by such designated Person.  For purposes of this
definition, the term "control" (including with correlative meanings, the
terms "controlling", "controlled by" and "under common control with") means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through
ownership of voting securities or other equity interests or by contract or
otherwise.

       "Agent" means the Person defined as the "Agent" in the preamble of this
Agreement and shall also include any successor Agent appointed pursuant to
Section 8.7.3 (Successor Agent).

       "Agent's Fee" has the meaning described in Section 2.5.4 (Agent's Fee).

       "Agent's Obligations" shall mean any and all Obligations payable solely
to and for the exclusive benefit of the Agent by any or all of the Borrowers
under the terms of this Agreement and/or any of the other Financing
Documents, including, without limitation, any and all Letter of Credit
Fees/or Field Examination Fees.

       "Aggregate Commitments" means the Commitments of all Lenders.

       "Agreement" means this Business Loan and Security Agreement, as
amended, restated, supplemented or otherwise modified in writing in
accordance with the provisions of Section 9.2 (Amendments; Waivers).

       "Applicable Base Rate" means for any day, a fluctuating per annum rate
of interest equal to the greater of the (i) Prime Rate, (ii) Federal Funds
Open Rate plus one half of one percent (0.50%) or (iii) LIBOR Daily Floating
Rate plus two percent (2.0%)

       "Applicable Interest Rate" means a (a) LIBOR-based Rate or (b) Base
Rate.

       "Assets" means at any date all assets that, in accordance with GAAP
consistently applied, should be classified as assets on a consolidated
balance sheet of the Borrowers and their respective Subsidiaries.

       "Assignee" means any Person to which any Lender assigns all or any
portion of its interests under this Agreement, any Commitment, and any Loan,
in accordance with the provisions of Section 9.5 (Assignments by Lenders),
together with any and all successors and assigns of such Person; "Assignees"
means the collective reference to all Assignees.

       "Bank Products" shall mean any (i) commercial credit card, purchase
card and merchant card services, or other commercial credit card services or
facilities, (ii) cash management services or facilities, (iii) foreign
investment or exchange products or services or (iv) products under any non-
speculative hedging agreement or arrangement, extended to any Borrower by
Lender or any Affiliate of Lender, from time to time.

       "Bankruptcy Code" means Title 11 of the United States Code, as amended
from time to time, and any successor Laws.

       "Base Rate" means the sum of (a) the Applicable Base Rate plus (b) the
Base Rate Margin.

       "Base Rate Loan" means any Loan, the rate of interest applicable to
which is based upon the Applicable Base Rate.

       "Base Rate Margin" means the amount determined to be in effect from
time to time in accordance with the matrix below.  The initial Base Rate
Margin will be determined at the Closing Date using the Leverage Ratio
calculated by reference to the consolidated financial statements of VSE and
the Compliance Certificate most recently received by the Agent.  Commencing
on the date following the Closing Date when the Agent receives the
consolidated financial statements of VSE and the Compliance Certificate in
accordance with this Agreement and on each such date thereafter, the Base
Rate Margin will be reset based on the Leverage Ratio calculated by reference
to such consolidated financial statements and Compliance Certificate.


      Base Rate Margin           Leverage Ratio
        ----------------           --------------
             0%                  Less than 1.00 to 1.0

            .25%                 Equal to or greater than 1.00 to 1.0
                                 but less than 2.00 to 1.0

            .50%                 Equal to or greater than 2.00 to 1.0

       In the event VSE fails to provide such consolidated financial
statements and Compliance Certificate to the Agent when due, the Base Rate
Margin shall be .50% until such time as such consolidated financial
statements and Compliance Certificate are submitted to and accepted by Agent
pursuant to this Agreement.

       "Borrower" means each Person defined as a "Borrower" in the preamble of
this Agreement and each Additional Borrower; "Borrowers" means the collective
reference to all Persons defined as "Borrowers" in the preamble to this
Agreement and all Additional Borrowers.

       "Borrowing Base" has the meaning described in Section 2.1.3 (Borrowing
Base).

       "Borrowing Base Deficiency" has the meaning described in Section 2.1.3
(Borrowing Base).

       "Borrowing Base Report" has the meaning described in Section 2.1.4
(Borrowing Base Report).

       "Business Day" means any day other than a Saturday, Sunday or other day
on which (a) in the case of Citizens (as Agent and Lender), commercial banks
in the State are authorized or required by law to close and, (b) in the case
of the Lenders, other than Citizens, are closed for the transaction of
business at their address listed in Section 9.1.

       "Capital Adequacy Regulation" means any guideline, request or directive
of any central bank or other Governmental Authority, or any other law, rule
or regulation, whether or not having the force of law, in each case,
regarding capital adequacy of any bank or of any corporation controlling a
bank.

       "Capital Expenditure" means an expenditure (whether payable in cash or
other property or accrued as a liability) for Fixed or Capital Assets,
including, without limitation, the entering into of a Capital Lease.

       "Capital Lease" means with respect to any Person any lease of real or
personal property, for which the related Lease Obligations have been or
should be, in accordance with GAAP consistently applied, capitalized on the
balance sheet of that Person.

       "Cash Equivalents" means (a) securities with maturities of one year or
less from the date of acquisition issued or fully guaranteed or insured by
the United States Government or any agency thereof, (b) certificates of
deposit with maturities of one (1) year or less from the date of acquisition
of, or money market accounts maintained with, the Agent, any Affiliate of the
Agent, or any other domestic commercial bank having capital and surplus in
excess of One Hundred Million Dollars ($100,000,000.00) or such other
domestic financial institutions or domestic brokerage houses to the extent
disclosed to, and approved by, the Agent and (c) commercial paper of a
domestic issuer rated at least either A-1 by Standard & Poor's Corporation
(or its successor) or P-1 by Moody's Investors Service, Inc. (or its
successor) with maturities of six (6) months or less from the date of
acquisition.

       "Chattel Paper" means a record or records (including, without
limitation, electronic chattel paper) that evidence both a monetary
obligation and a security interest in specific goods, a security interest in
specific goods and software used in the goods, or a lease of specific goods;
all Supporting Obligations with respect thereto; any returned, rejected or
repossessed goods and software covered by any such record or records and all
proceeds (in any form including, without limitation, accounts, contract
rights, documents, chattel paper, instruments and general intangibles) of
such returned, rejected or repossessed goods; and all Proceeds of the
foregoing.

       "Closing Date" means the Business Day, on which the Agent shall be
satisfied that the conditions precedent set forth in Section 5.1 (Conditions
to Initial Advance) have been fulfilled or otherwise waived by the Agent.

       "Collateral" means all property of each and every Borrower subject from
time to time to the Liens of this Agreement, any of the Security Documents
and/or any of the other Financing Documents, together with any and all
Proceeds and products thereof.

       "Collateral Account" has the meaning described in Section 2.1.9 (The
Collateral Account).

       "Collateral Disclosure List" has the meaning described in Section 3.3
(Collateral Disclosure List).

       "Collection" means each check, draft, cash, money, instrument, item,
and other remittance in payment or on account of payment of the Accounts or
otherwise with respect to any Collateral, including, without limitation, cash
proceeds of any returned, rejected or repossessed goods, the sale or lease of
which gave rise to an Account, and other proceeds of Collateral; and
"Collections" means the collective reference to all of the foregoing.

       "Commitment" means with respect to each Lender, such Lender's Revolving
Credit Commitment and with respect to Citizens only, the Swing Line
Commitment, and "Commitments" means the collective reference to the Revolving
Credit Commitments of all of the Lenders and the Swing Line Commitment.

       "Commitment Letter" means that certain Commitment Letter, dated June 1,
2009, by Citizens to VSE, as accepted by VSE on June 4, 2009.

       "Committed Amount" means with respect to each Lender, such Lender's
Revolving Loan Committed Amount and with respect to Citizens only, the Swing
Line Commitment Amount and "Committed Amounts" means collectively the
Revolving Loan Committed Amount of each of the Lenders and the Swing Line
Committed Amount.

       "Compliance Certificate" means a periodic Compliance Certificate
described in Section 6.1.1 (Financial Statements).

       "Commonly Controlled Entity" means an entity, whether or not
incorporated, which is under common control with any Borrower within the
meaning of Section 414(b) or (c) of the Internal Revenue Code.

       "Copyrights" means and includes, in each case whether now existing or
hereafter arising, all of each Borrower's rights, title and interest in and
to (a) all copyrights, rights and interests in copyrights, works protectable
by copyright, copyright registrations, copyright applications, and all
renewals of any of the foregoing, (b) all income, royalties, damages and
payments now or hereafter due and/or payable under any of the foregoing,
including, without limitation, damages or payments for past, current or
future infringements of any of the foregoing, (c) the right to sue for past,
present and future infringements of any of the foregoing, and (d) all rights
corresponding to any of the foregoing throughout the world.

       "Credit Facility" means with respect to each Lender, such Lender's Pro
Rata Share of the Revolving Credit Facility or the Letter of Credit Sub-
Facility, as the case may be and with respect to Citizens only, the Swing
Line Sub-Facility and "Credit Facilities" means collectively the Revolving
Credit Facility, the Letter of Credit Sub-Facility, the Swing Line Sub-
Facility and any and all other credit facilities now or hereafter extended
under or secured by this Agreement.

       "Deposit Account" means a demand, time, savings, passbook or similar
account maintained with a bank or financial institution in which funds are
held or invested for credit to or for the benefit of any Borrower.

       "Deposit Account Control Agreement" means an agreement, in form and
substance reasonably satisfactory to Agent, among Agent, any applicable
Borrower and each bank or financial institution in which such Borrower
maintains a Deposit Account, which agreement provides that (a) such bank or
financial institution acknowledges the security interest of Agent in such
Deposit Account, (b) such bank or financial institution shall comply with
instructions originated by Agent directing disposition of the funds in such
Deposit Account without further consent by the applicable Borrower, and (c)
such bank or financial institution shall agree that it shall have no Lien on,
or right of setoff or recoupment against, such Deposit Account or the
contents thereof, other than in respect of usual and customary service fees
and of returned items for which Agent has been given value, in each such case
expressly consented to by Agent, and containing such other or different terms
and conditions as Agent may require.

       "Default" means an event which, with the giving of notice or lapse of
time, or both, could or would constitute an Event of Default under the
provisions of this Agreement.

       "Documents" means all documents of title or receipts, whether now
existing or hereafter acquired or created, and all Proceeds of the foregoing.

       "EBITDA" means as to Borrowers for any period of determination thereof,
the sum of (a) net profit (or loss) determined in accordance with GAAP
consistently applied, plus (b) net interest expense and income tax provisions
for such period, plus (c) depreciation and amortization of assets for such
period, plus (d) non-cash stock compensation, which does not represent a
reserve for future cash payments, plus (e) non-cash non-recurring charges, as
approved in writing by the Agent prior to the due date of the Compliance
Certificate as required under Sections 6.1.1(a) (Annual Statements and
Certificates) and 6.1.1(b) (Quarterly Statements and Certificates), minus any
non-cash gains to the extent included in net income.  EBITDA shall be
determined on a rolling basis, based on the four (4) quarter period then
ending.  EBITDA from any Permitted Acquisitions will be included on a pro
forma basis as such amounts may be deemed acceptable to the Agent in its sole
and absolute discretion.

       "Eligible Receivable" and "Eligible Receivables" mean, at any time of
determination thereof, the unpaid portion of each account (net of any
returns, discounts, claims, credits, charges, accrued rebates or other
allowances, offsets, deductions, counterclaims, disputes or other defenses
and reduced by the aggregate amount of all reserves, limits and deductions
provided for in this definition and elsewhere in this Agreement) receivable
in United States Dollars by a Borrower, provided each account conforms and
continues to conform to the following criteria to the satisfaction of the
Agent:
                      (a)     the account arose in the ordinary course
of a Borrower's business from a bona fide outright sale of
Inventory by such Borrower or from services performed by such
Borrower;
                      (b)     the account is a valid, legally
enforceable obligation of the Account Debtor and requires no
further act on the part of any Person under any circumstances to
make the account payable by the Account Debtor;

                      (c)     the account is based upon an enforceable
order or contract, written or oral, for Inventory shipped or for
services performed, and the same were shipped or performed in
accordance with such order or contract;

                      (d)     if the account arises from the sale of
Inventory, the Inventory the sale of which gave rise to the
account has been shipped or delivered to the Account Debtor on an
absolute sale basis and not on a bill and hold sale basis, a
consignment sale basis, a guaranteed sale basis, a sale or return
basis, or on the basis of any other similar understanding;

                      (e)     if the account arises from the
performance of services, such services have been fully rendered
and do not relate to any warranty claim or obligation;

                      (f)     the account is evidenced by an invoice or
other documentation in form acceptable to the Agent, dated no
later than the date allowed under any contract governing such
account and containing only terms normally offered by the
respective Borrower;

                      (g)     the amount shown on the books of a
Borrower and on any invoice, certificate, schedule or statement
delivered to the Agent is owing to such Borrower and no partial
payment has been received unless reflected with that delivery;

                      (h)     the account is not outstanding more than
ninety (90) days from the date of the invoice therefore;

                      (i)     the account is not owing by any Account
Debtor for which the Agent has deemed fifty percent (50%) or more
of such Account Debtor's other accounts (or any portion thereof)
due to a Borrower, individually, or all of the Borrowers
collectively, to be non-Eligible Receivables;

                      (j)     the Account Debtor has not returned,
rejected or refused to retain, or otherwise notified a Borrower
of any dispute concerning, or claimed nonconformity of, any of
the Inventory or services from the sale or furnishing of which
the account arose;

                      (k)     the account is not subject to any present
or contingent (and no facts exist which are the basis for any
future) offset, claim, deduction or counterclaim, dispute or
defense in law or equity on the part of such Account Debtor, or
any claim for credits, allowances, or adjustments by the Account
Debtor because of returned, inferior, or damaged Inventory or
unsatisfactory services, or for any other reason including,
without limitation, those arising on account of a breach of any
express or implied representation or warranty;

                      (l)     the Account Debtor is not a Subsidiary or
Affiliate of any Borrower or an employee, officer, director or
shareholder of any Borrower or any Subsidiary or Affiliate of any
Borrower, other than any joint venture of the Borrower or any
Subsidiary;

                      (m)     the Account Debtor is not incorporated or
primarily conducting business or otherwise located in any
jurisdiction outside of the United States of America, unless the
Account Debtor's obligations with respect to such account are
secured by a letter of credit, guaranty or banker's acceptance
having terms and from such issuers and confirmation banks as are
acceptable to the Agent in its sole and absolute discretion
(which letter of credit, guaranty or banker's acceptance is
subject to the perfected Lien of the Agent for the benefit of the
Lenders ratably and the Agent);

                      (n)     as to which none of the following events
has occurred with respect to the Account Debtor on such Account: 
death or judicial declaration of incompetency of an Account
Debtor who is an individual; the filing by or against the Account
Debtor of a request or petition for liquidation, reorganization,
arrangement, adjustment of debts, adjudication as a bankrupt,
winding-up, or other relief under the bankruptcy, insolvency, or
similar laws of the United States, any state or territory
thereof, or any foreign jurisdiction, now or hereafter in effect;
the making of any general assignment by the Account Debtor for
the benefit of creditors; the appointment of a receiver or
trustee for the Account Debtor or for any of the assets of the
Account Debtor, including, without limitation, the appointment of
or taking possession by a "custodian," as defined in the Federal
Bankruptcy Code; the institution by or against the Account Debtor
of any other type of insolvency proceeding (under the bankruptcy
laws of the United States or otherwise) or of any formal or
informal proceeding for the dissolution or liquidation of,
settlement of claims against, or winding up of affairs of, the
Account Debtor; the sale, assignment, or transfer of all or any
material part of the assets of the Account Debtor; the nonpayment
generally by the Account Debtor of its debts as they become due;
or the cessation of the business of the Account Debtor as a going
concern;

                      (o)     no Borrower is indebted in any manner to
the Account Debtor (as creditor, lessor, supplier or otherwise,
other than trade debt incurred in the ordinary course of
business), with the exception of customary credits, adjustments
and/or discounts given to an Account Debtor by a Borrower in the
ordinary course of its business;

                      (p)     the account does not arise from services
under or related to any warranty obligation of a Borrower or out
of service charges, finance charges or other fees for the time
value of money;

                      (q)     the account is not evidenced by Chattel
Paper or an instrument of any kind and is not secured by any
letter of credit;

                      (r)     the title of the respective Borrower to
the account is absolute and is not subject to any prior
assignment, claim, Lien, or security interest, except Permitted
Liens;

                      (s)     no bond or other undertaking by a
guarantor or surety has been or is required to be obtained,
supporting the account and any of the Account Debtor's
obligations in respect of the account;

                      (t)     each Borrower has the full and
unqualified right and power to assign and grant a security
interest in, and Lien on, the account to the Agent and the
Lenders as security and collateral for the payment of the
Obligations and the Agent's Obligations;

                      (u)     the account does not arise out of a
contract with, or order from, an Account Debtor that, by its
terms, forbids or makes void or unenforceable the assignment or
grant of a security interest by the Borrowers to the Agent, for
the benefit of the Lenders ratably and the Agent, of the account
arising from such contract or order;

                      (v)     the account is subject to a Lien in favor
of the Agent, for the benefit of the Lenders ratably and the
Agent, which Lien is perfected as to the account by the filing of
financing statements and which Lien upon such filing constitutes
a first priority security interest and Lien;

                      (w)     the Inventory giving rise to the account
was not, at the time of the sale thereof, subject to any Lien,
except those in favor of the Agent, for the benefit of the
Lenders ratably and the Agent;

                      (x)     no part of the account represents a
retainage;

                      (y)     the Agent in the good faith exercise of
its sole and absolute discretion has not deemed the account
ineligible because of uncertainty as to the creditworthiness of
the Account Debtor or because the Agent otherwise considers the
collateral value of such account to the Agent and the Lenders to
be impaired or its or their ability to realize such value to be
insecure; and

                      (z)     if the Account Debtor is located in a
state requiring the filing of a Notice of Business Activities
Report or similar report in order to permit any Borrower to seek
judicial enforcement in such state of payment of such Account,
that Borrower has qualified to do business in such state or has
filed a Notice of Business Activities Report or equivalent report
for the then current year.

       In the event of any dispute, under the foregoing criteria, as to
whether an account is, or has ceased to be, an Eligible Receivable, the
decision of the Agent in the good faith exercise of its sole and absolute
discretion shall control.

       "Enforcement Costs" means all expenses, charges, costs and fees
whatsoever (including, without limitation, reasonable outside and allocated
in-house counsel attorney's fees and expenses) of any nature whatsoever paid
or incurred by or on behalf of the Agent and/or any of the Lenders in
connection with (a) any or all of the Obligations, this Agreement and/or any
of the other Financing Documents, (b) the creation, perfection, collection,
maintenance, preservation, defense, protection, realization upon,
disposition, sale or enforcement of all or any part of the Collateral, this
Agreement or any of the other Financing Documents, including, without
limitation, those costs and expenses more specifically enumerated in Section
3.6 (Costs) and/or Section 9.10 (Enforcement Costs), and further including,
without limitation, amounts paid to lessors, processors, bailees,
warehousemen, sureties, judgment creditors and others in possession of or
with a Lien against or claimed against the Collateral, and (c) the
monitoring, administration, processing and/or servicing of any or all of the
Obligations, the Financing Documents, and/or the Collateral.

       "Equipment" means all equipment, machinery, computers, chattels, tools,
parts, machine tools, furniture, furnishings, fixtures and supplies of every
nature, presently existing or hereafter acquired or created and wherever
located, whether or not the same shall be deemed to be affixed to real
property, and all of such types of property leased by any Borrower and all of
the Borrowers' rights and interests with respect thereto under such leases
(including, without limitation, options to purchase), together with all
accessions, additions, fittings, accessories, special tools, and improvements
thereto and substitutions therefor and all parts and equipment which may be
attached to or which are necessary or beneficial for the operation, use
and/or disposition of such personal property, all licenses, warranties,
franchises and General Intangibles related thereto or necessary or beneficial
for the operation, use and/or disposition of the same, together with all
Accounts, Chattel Paper, Instruments and other consideration received by any
Borrower on account of the sale, lease or other disposition of all or any
part of the foregoing, and together with all rights under or arising out of
present or future Documents and contracts relating to the foregoing and all
Proceeds of the foregoing.

       "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.

       "Euro-Dollar Business Day" means any day on which commercial banks are
open for domestic and international business (including dealing in U.S.
Dollar Deposits) in London, England and the Commonwealth of Pennsylvania.

       "Event of Default" has the meaning described in ARTICLE VII (Default
and Rights and Remedies).

       "Facilities" means the collective reference to the loan, letter of
credit, interest rate protection, foreign exchange risk, cash management, and
other credit facilities now or hereafter provided to any one or more of the
Borrowers by the Agent or the Lenders under this Agreement or otherwise by
Citizens.

       "Federal Funds Open Rate" means for any day of determination, the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business Day) by the Federal
Reserve Bank for the next preceding Business Day) by the Federal Reserve Bank
of Richmond or, if such rate is not so published for any day that is a
Business Day, the average of quotations for such day on such transactions
received by the Agent from three (3) federal funds brokers of recognized
standing selected by the Agent.

       "Fees" means the collective reference to each fee payable to the Agent,
for its own account or for the ratable benefit of the Lenders, under the
terms of this Agreement or under the terms of any of the other Financing
Documents, including, without limitation, the Revolving Credit Unused Line
Fee, the Origination Fee, Agent's Fee, Letter of Credit Fees and the Field
Examination Fees.

       "Field Examination Fee" and "Field Examination Fees" have the meanings
described in Section 2.5.5 (Field Examination Fees).

       "Financing Documents" means at any time collectively this Agreement,
the Notes, the Security Documents, the Letter of Credit Documents, and any
other instrument, agreement or document previously, simultaneously or
hereafter executed and delivered by any Borrower, and/or any other Person,
singly or jointly with another Person or Persons, evidencing, securing,
guarantying or in connection with this Agreement, any Note, any of the
Security Documents, any of the Facilities, and/or any of the Obligations.

       "Fixed or Capital Assets" of a Person at any date means all assets
which would, in accordance with GAAP consistently applied, be classified on
the balance sheet of such Person as property, plant or equipment at such
date.

       "Fixed Charge Coverage Ratio" means as to Borrowers for any period of
determination thereof the ratio of (a) the sum of (i) EBITDA, plus (ii)
operating lease payments (including rent), minus (iii) cash taxes, minus (iv)
cash dividends, minus (v) share repurchases to (b) Fixed Charges.

       "Fixed Charges" means as to Borrowers for any period of determination
thereof, the sum of (i) scheduled or required principal payments on all
Indebtedness for Borrowed Money of Borrowers, plus (ii) all operating lease
payments (including rent), plus (iii) cash interest expense, plus (iv) any
earn-out payments of Borrowers paid in cash.

       "Funding Office" means the office of the Agent specified in Section 9.1
or such other office as may be specified from time to time by the Agent as
its funding office by written notice to VSE and the Lenders.

       "GAAP" means generally accepted accounting principles in the United
States of America in effect from time to time.

       "General Intangibles" means all general intangibles of every nature,
whether presently existing or hereafter acquired or created, and without
implying any limitation of the foregoing, further means all books and
records, commercial tort claims, other claims (including without limitation
all claims for income tax and other refunds), payment intangibles, Supporting
Obligations, choses in action, claims, causes of action in tort or equity,
contract rights, judgments, customer lists, software, Patents, Trademarks,
licensing agreements, rights in intellectual property, goodwill (including
goodwill of Borrower's business symbolized by and associated with any and all
Trademarks, trademark licenses, Copyrights and/or service marks), royalty
payments, licenses, letter-of-credit rights, letters of credit, contractual
rights, the right to receive refunds of unearned insurance premiums, rights
as lessee under any lease of real or personal property, literary rights,
Copyrights, service names, service marks, logos, trade secrets, amounts
received as an award in or settlement of a suit in damages, deposit accounts,
interests in joint ventures, general or limited partnerships, or limited
liability companies or partnerships, rights in applications for any of the
foregoing, books and records in whatever media (paper, electronic or
otherwise) recorded or stored, with respect to any or all of the foregoing,
all Supporting Obligations with respect to any of the foregoing, and all
Equipment and General Intangibles necessary or beneficial to retain, access
and/or process the information contained in those books and records, and all
Proceeds of the foregoing.

       "Good Faith Deposit" has the meaning described in Section 2.5.3
(Origination Fee; Good Faith Deposit).

       "Government Contracts" means any contract with the United States or any
department, agency or instrumentality of the United States where Borrower is
the prime contractor.

       "Governmental Authority" means any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government and any department, agency or instrumentality
thereof.

       "Hazardous Materials" means (a) any "hazardous waste" as defined by the
Resource Conservation and Recovery Act of 1976, as amended from time to time,
and regulations promulgated thereunder; (b) any "hazardous substance" as
defined by the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended from time to time, and regulations
promulgated thereunder; (c) any substance the presence of which on any
property now or hereafter owned, acquired or operated by any of the Borrowers
is prohibited by any Law similar to those set forth in this definition; and
(d) any other substance which by Law requires special handling in its
collection, storage, treatment or disposal.

       "Hazardous Materials Contamination" means the contamination (whether
presently existing or occurring after the date of this Agreement) by
Hazardous Materials of any property owned, operated or controlled by any of
the Borrowers or for which any of the Borrowers has responsibility,
including, without limitation, improvements, facilities, soil, ground water,
air or other elements on, or of, any property now or hereafter owned,
acquired or operated by any of the Borrowers, and any other contamination by
Hazardous Materials for which any of the Borrowers is, or is claimed to be,
responsible.

       "Increased Revolving Facility Activation Notice" means a notice
substantially in the form of Exhibit E attached hereto and made a part
hereof.

       "Increased Revolving Facility Closing Date" any Business Day designated
as such in an Increased Revolving Facility Activation Notice.

       "Incremental Revolving Loans" has the meaning described in 2.1.6
(Increase to Revolving Credit Facility).

       "Indebtedness" of a Person means at any date the total liabilities of
such Person at such time determined in accordance with GAAP consistently
applied.

       "Indebtedness for Borrowed Money" of a Person means at any time the sum
at such time of (a) Indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services, (b) any obligations of such
Person in respect of letters of credit, banker's or other acceptances or
similar obligations issued or created for the account of such Person, (c)
Lease Obligations of such Person with respect to Capital Leases, (d) all
liabilities secured by any Lien on any property owned by such Person, to the
extent attached to such Person's interest in such property, even though such
Person has not assumed or become personally liable for the payment thereof,
(e) obligations of third parties which are being guarantied or indemnified
against by such Person or which are secured by the property of such Person;
(f) any obligation of such Person under an employee stock ownership plan or
other similar employee benefit plan; (g) any obligation of such Person or a
Commonly Controlled Entity to a Multi-employer Plan; and (h) any obligations,
liabilities or indebtedness, contingent or otherwise, under or in connection
with, any Swap Transaction; but excluding trade and other accounts payable in
the ordinary course of business in accordance with customary trade terms and
which are not overdue (as determined in accordance with customary trade
practices) or which are being disputed in good faith by such Person and for
which adequate reserves are being provided on the books of such Person in
accordance with GAAP.

       "Indemnified Parties" has the meaning set forth in Section 9.19
(Indemnification).

       "Instrument" means a negotiable instrument or any other writing which
evidences a right to payment of a monetary obligation and is not itself a
security agreement or lease and is of a type that in the ordinary course of
business is transferred by delivery with any necessary endorsement or
assignment, and all Supporting Obligations with respect to any of the
foregoing and all Proceeds with respect to any of the foregoing.

       "Interest Payment Date" means with respect to any Base Rate Loan the
last day of each calendar month commencing on July 31, 2009 and continuing
thereafter until the Obligations have been irrevocably paid in full.

       "Interest Period" means the period during which interest at a LIBOR-
based Rate, determined as provided in this Agreement, shall be applicable to
the Rate Request Amount in question, provided, however, that each such period
shall be either one (1), two (2) or three (3) months which shall be measured
from the date specified by the Borrowers in each Rate Request Notice for the
commencement of the computation of interest at a LIBOR-based Rate to the
numerically corresponding day in the calendar month in which such period
terminates (or, if there is numerical Euro-Dollar Business Day of a calendar
month, then the last Euro-Dollar Business Day of the calendar month in which
such period terminates, or if the numerically corresponding day is not a
Euro-Dollar Business Day, then the next succeeding Euro-Dollar Business Day
enters a new calendar month, in which case such period shall end on the next
preceding Euro-Dollar Business Day) and in no event shall any such period
extend beyond the Revolving Credit Termination Date.

       "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the Income Tax Regulations issued and proposed
to be issued thereunder.

       "Inventory" means all goods of Borrowers and all right, title and
interest of Borrowers in and to all of its now owned and hereafter acquired
goods and other personal property furnished under any contract of service or
intended for sale or lease, including, without limitation, all raw materials,
work-in-process, finished goods and materials and supplies of any kind,
nature or description which are used or consumed in Borrowers' business or
are or might be used in connection with the manufacture, packing, shipping,
advertising, selling or finishing of such goods and other personal property
and all licenses, warranties, franchises, General Intangibles, personal
property and all documents of title or documents relating to the same,
together with all Accounts, Chattel Paper, Instruments and other
consideration received by Borrowers on account of the sale, lease or other
disposition of all or any part of the foregoing, and together with all rights
under or arising out of present or future Documents and contracts relating to
the foregoing and all Proceeds of the foregoing.

       "Investment Property" means a security, whether certificated or
uncertificated, security entitlement, securities account, commodity contract
or commodity account and all Proceeds of, and Supporting Obligations with
respect to, the foregoing.

       "Item of Payment" means each check, draft, cash, money, instrument,
item, and other remittance in payment or on account of payment of the
Receivables or otherwise with respect to any Collateral, including, without
limitation, cash proceeds of any returned, rejected or repossessed goods, the
sale or lease of which gave rise to a Receivable, and other proceeds of
Collateral; and "Items of Payment" means the collective reference to all of
the foregoing.

       "Laws" means all ordinances, statutes, rules, regulations, orders,
injunctions, writs, or decrees of any Governmental Authority.

       "Lease Obligations" of a Person means for any period the rental
commitments of such Person for such period under leases for real and/or
personal property (net of rent from subleases thereof, but including taxes,
insurance, maintenance and similar expenses which such Person, as the lessee,
is obligated to pay under the terms of said leases, except to the extent that
such taxes, insurance, maintenance and similar expenses are payable by
sublessees), including rental commitments under Capital Leases.

       "Letter of Credit" and "Letters of Credit" shall have the meanings
described in Section 2.2.1 (Letters of Credit).

       "Letter of Credit Agreement" means the collective reference to each
letter of credit application and agreement substantially in the form of the
Agent's then standard form of application for letter of credit or such other
form as may be approved by the Agent, executed and delivered by any one or
more of the Borrowers in connection with the issuance of a Letter of Credit,
as the same may from time to time be amended, restated, supplemented or
modified; and

       "Letter of Credit Agreements" means all of the foregoing in effect at
any time and from time to time.

       "Letter of Credit Documents" means any and all drafts under or
purporting to be under a Letter of Credit, any Letter of Credit Agreement,
and any other instrument, document or agreement executed and/or delivered by
any one or more of the Borrowers or any other Person under, pursuant to or in
connection with a Letter of Credit or any Letter of Credit Agreement.

       "Letter of Credit Fee" and "Letter of Credit Fees" have the meanings
described in Section 2.2.2 (Letter of Credit Fees).

       "Letter of Credit Issuance Fee" means that per annum percentage rate
determined by Agent from time to time in accordance with the matrix below. 
The initial Letter of Credit Issuance Fee will be determined at the Closing
Date using the Leverage Ratio calculated by reference to the consolidated
financial statements of VSE and the Compliance Certificate most recently
received by the Agent.  Commencing on the date following the Closing Date
when the Agent receives the consolidated financial statements of VSE and the
Compliance Certificate in accordance with this Agreement and on each such
date thereafter, the Letter of Credit Issuance Fee will be reset based on the
Leverage Ratio calculated by reference to such consolidated financial
statements and Compliance Certificate.

    Letter of Credit Issuance Fee             Leverage Ratio
    -----------------------------              --------------
                2.00%                     Less than 1.00 to 1.0

                2.25%                     Equal to or greater than 1.00
                                          to 1.0 but less than 2.00 to 1.0

                2.50%                     Equal to or greater than 2.00 to 1.0

       In the event VSE fails to provide such consolidated financial
statements and Compliance Certificate to the Agent when due, the Letter of
Credit Issuance Fee shall be 2.50% until such time as such consolidated
financial statements and Compliance Certificate are submitted to and accepted
by the Agent pursuant to this Agreement.

       "Letter of Credit Obligations" means the collective reference to all
Obligations of any one or more of the Borrowers with respect to the Letters
of Credit and the Letter of Credit Agreements.

       "Letter-of-credit right" means a right to payment or performance under
a letter of credit, whether or not the beneficiary has demanded or is at the
time entitled to demand payment or performance.

       "Letter of Credit Sub-Facility" means the sub-facility established
pursuant to Section 2.2 (Letter of Credit Sub-Facility).

       "Leverage Ratio" means the ratio of Total Funded Debt on a specified
date to EBITDA for the four (4) quarter period then ending on such date.

       "Liabilities" means at any date all liabilities that in accordance with
GAAP consistently applied should be classified as liabilities on a
consolidated balance sheet of the Borrowers and their respective
Subsidiaries.

       "LIBOR Amount" means each portion of the Principal Amount bearing
interest at a LIBOR-based Rate pursuant to a Rate Request Notice.

       "LIBOR-based Rate" means an interest rate fixed for one, two or three
month periods at a rate equal to the corresponding LIBOR Rate (i.e. the one,
two or three month LIBOR Rate) plus the LIBOR Rate Margin in effect on the
date of the corresponding Rate Request Notice.

       "LIBOR Daily Floating Rate" is the fluctuating rate of interest
(rounded upwards, if necessary to the nearest 1/100 of 1%) appearing on
Telerate Page 3750 (or any successor page) as the one (1) month London
interbank offered rate for deposits in United States Dollars at approximately
11:00 a.m. (London time) on the second preceding business day, as adjusted
from time to time in Agent's sole discretion for then-applicable reserve
requirements, deposit insurance assessment rates and other regulatory costs. 
If for any reason such rate is not available, the term "LIBOR Daily Floating
Rate" shall mean the fluctuating rate of interest equal to the rate of
interest (rounded upwards, if necessary to the nearest 1/100 of 1%) appearing
on Reuters Screen LIBO Page as the one (1) month London interbank offered
rate for deposits in United States Dollars at approximately 11:00 a.m.
(London time) on the second preceding day, as adjusted from time to time in
Lender's sole discretion for then-applicable reserve requirements, deposit
insurance assessment rates and other regulatory costs; provided, however, if
more than one rate is specified on Reuters Screen LIBO page, the applicable
rate shall be the arithmetic mean of all such rates.  Any change in the rate
will take effect on the date of such change in the LIBOR Daily Floating Rate
as indicated on Telerate Page 3750.  Interest will accrue on any non-banking
day at the rate in effect on the immediately preceding banking day.

       "LIBOR Loan" means any Revolving Loan, the rate of interest applicable
to which is based upon the LIBOR Rate.

       "LIBOR Rate" means the London interbank offered rate of major banks for
deposits in United States Dollars for a designated period (e.g. one, two or
three) as set forth at Telerate Page 3750 at approximately 11:00 a.m. London
time on the third Euro-Dollar Business Day preceding the date when the LIBOR-
based Rate will be become effective; provided, however, that if such
information is not available on Telerate, the "LIBOR Rate" shall be
determined from information supplied to the Lender by a nationally recognized
reporting service for similar information acceptable to the Lender.

       "LIBOR Rate Margin" means the amount determined to be in effect from
time to time in accordance with the matrix below.  The initial LIBOR Rate
Margin will be determined at the Closing Date using the Leverage Ratio
calculated by reference to the consolidated financial statements of VSE and
the Compliance Certificate most recently received by the Agent.  Commencing
on the date following the Closing Date when the Agent receives the
consolidated financial statements of VSE and the Compliance Certificate in
accordance with this Agreement and on each such date thereafter, the LIBOR
Rate Margin will be reset based on the Leverage Ratio calculated by reference
to such consolidated financial statements and Compliance Certificate.

         LIBOR Rate Margin            Leverage Ratio
       -----------------            --------------
                2.00%                 Less than 1.00 to 1.0

                2.25%                 Equal to or greater than 1.00
                                      to 1.0 but less than 2.00 to 1.0

                2.50%                 Equal to or greater than 2.00 to 1.0

       In the event VSE fails to provide such consolidated financial
statements and Compliance Certificate to the Agent when due, the LIBOR Rate
Margin shall be 2.50% until such time as such consolidated financial
statements and Compliance Certificate are submitted to and accepted by the
Agent pursuant to this Agreement.

       "Lien" means any mortgage, deed of trust, deed to secure debt, grant,
pledge, security interest, assignment, encumbrance, judgment, lien, financing
statement, hypothecation, provision in any instrument or other document for
confession of judgment, cognovit or other similar right or other remedy,
claim, charge, control over or interest of any kind in real or personal
property securing any indebtedness, duties, obligations, and liabilities owed
to, or a claimed to be owed to, a Person, all whether perfected or
unperfected, avoidable or unavoidable, based on the common law, statute or
contract or otherwise, including, without limitation, any conditional sale or
other title retention agreement, any lease in the nature thereof, and the
filing of or agreement to give any financing statement under the Uniform
Commercial Code of any jurisdiction, excluding the precautionary filing of
any financing statement by any lessor in a true lease transaction, by any
bailor in a true bailment transaction or by any consignor in a true
consignment transaction under the Uniform Commercial Code of any jurisdiction
or the agreement to give any financing statement by any lessee in a true
lease transaction, by any bailee in a true bailment transaction or by any
consignee in a true consignment transaction.

       "Loan" means each of the Revolving Loan or the Swing Line Loan and
"Loans" means the collective reference to the Revolving Loans or the Swing
Line Loans.

       "Loan Notice" has the meaning described in Section 2.1.2 (Procedure for
Making Advances).

       "Lockbox" has the meaning described in Section 2.1.9 (The Collateral
Account).

       "Maximum Rate" has the meaning described in Section 2.5.7 (Maximum
Interest Rate).

       "Multi-employer Plan" means a Plan that is a Multi-employer plan as
defined in Section 4001(a)(3) of ERISA.

       "Net Outstandings" of any Lender means, at any time, the sum of (a) all
amounts paid by such Lender (other than pursuant to Section 8.5
(Indemnification)) to the Agent in respect to the Revolving Loan or otherwise
under this Agreement, minus (b) all amounts paid by the Agent to such Lender
which are received by the Agent and which, pursuant to this Agreement, are
paid over to such Lender for application in reduction of the outstanding
principal balance of the Revolving Loan.

       "Non-Ratable Loan" means an advance under the Revolving Loan made by
Citizens in accordance with the provisions of Section 2.6.2(b) (Selection of
Settlement Dates).

       "Note" means any Revolving Credit Note, the Swing Line Note or
Replacement Revolving Credit Note and "Notes" means collectively each
Revolving Credit Note, the Swing Line Note, Replacement Revolving Credit Note
and any other promissory note which may from time to time evidence all or any
portion of the Obligations.

       "Obligations" means all present and future, whether now existing or
contemplated or hereafter arising, of any one or more of the Borrowers to the
Lenders and/or Agent under, arising pursuant to, in connection with and/or on
account of the provisions of this Agreement, each Note, each Security
Document, and/or any of the other Financing Documents, the Loans, and/or any
of the Facilities including, without limitation, the principal of, and
interest on, each Note, late charges, the Fees, Enforcement Costs, and
prepayment fees (if any), letter of credit reimbursement obligations, letter
of credit fees or fees charged with respect to any guaranty of any letter of
credit; also means all other present and future indebtedness, duties,
obligations, and liabilities, whether now existing or contemplated or
hereafter arising, of any one or more of the Borrowers to the Agent and/or to
Lenders or its Affiliates of any nature whatsoever, including, without
limitation, any indebtedness, duties, obligations, and liabilities, under or
in connection with, any Swap Transaction or Bank Products, regardless of
whether such indebtedness, duties, obligations, and liabilities be direct,
indirect, primary, secondary, joint, several, joint and several, fixed or
contingent; and also means any and all renewals, extensions, substitutions,
amendments, restatements and rearrangements of any such indebtedness, duties,
obligations, and liabilities.

       "OFAC" means the Office of Foreign Assets Control of the United States
Department of the Treasury.

       "Officer's Certificate" means an Officer's Certificate described in
Section 6.1.29 (Permitted Acquisitions) in substantially the forms attached
to this Agreement as Exhibit F-1 and Exhibit F-2.

       "Origination Fee" has the meaning described in Section 2.5.3
(Origination Fee; Good Faith Deposit).

       "Outstanding Letter of Credit Obligations" has the meaning described in
Section 2.2.3 (Terms of Letters of Credit).

       "Patents" means and includes, in each case whether now existing or
hereafter arising, all of each Borrower's rights, title and interest in and
to (a) any and all patents and patent applications, (b) any and all
inventions and improvements described and claimed in such patents and patent
applications, (c) reissues, divisions, continuations, renewals, extensions
and continuations-in-part of any patents and patent applications, (d) income,
royalties, damages, claims and payments now or hereafter due and/or payable
under and with respect to any patents or patent applications, including,
without limitation, damages and payments for past and future infringements,
(e) rights to sue for past, present and future infringements of patents, and
(f) all rights corresponding to any of the foregoing throughout the world.

       "PBGC" means the Pension Benefit Guaranty Corporation.

       "Permitted Acquisitions" means a transaction or series of transactions
whereby a Borrower acquires all or substantially all of the assets of a
business, or purchases an equity interest in a business (the "Target"),
provided, that, (i) the acquisition or purchase price consideration paid by
the Borrowers shall not be greater than Ten Million Dollars ($10,000,000) for
each Permitted Acquisition and shall not exceed Twenty-Five Million Dollars
($25,000,000) in the aggregate for all Permitted Acquisitions; (ii) the
Target shall be in a similar line of business as that of the Borrowers; (iii)
the Target shall be a going concern, not involved in any material litigation
that is not fully covered by reserves and/or insurance and shall have
positive EBITDA for the immediately preceding twelve (12) months; (iv) both
before and after giving effect to such transaction, no Default or Event of
Default shall be continuing or shall occur as a result of such transaction;
(v) the Borrowers will be in compliance with all financial covenants after
giving pro forma effect to such transaction; (vi) after giving pro forma
effect to such transaction there must be at least Ten Million Dollars
($10,000,000) of availability under the Revolving Loan; (vii) the Agent shall
have received evidence satisfactory to the Agent that arrangements shall have
been made for the termination of all Liens encumbering any asset of the
Target; (viii) no Indebtedness shall be assumed by any Borrower in connection
with such transaction; (ix) the Agent shall have received and approved
complete copies of the Purchase Agreement Documents; and (x) within 15 days
of closing any transaction contemplated hereby, the Target shall be joined to
this Agreement as an Additional Borrower by executing and delivering to the
Agent an Additional Borrower Joinder Supplement and shall grant to Agent for
the benefit or the Agent and Lenders a Lien in all of its assets.

       "Permitted Liens" means:  (a) Liens for Taxes which are not delinquent
or which the Agent has determined in the exercise of its sole and absolute
discretion (i) are being diligently contested in good faith and by
appropriate proceedings, and such contest operates to suspend collection of
the contested Taxes and enforcement of a Lien, (ii) the respective Borrower
has the financial ability to pay, with all penalties and interest, at all
times without materially and adversely affecting such Borrower, and (iii) are
not, and will not be with appropriate filing, the giving of notice and/or the
passage of time, entitled to priority over any Lien of the Agent and/or the
Lenders; (b) deposits or pledges to secure obligations under workers'
compensation, social security or similar laws, or under unemployment
insurance in the ordinary course of business; (c) Liens securing the
Obligations; (d) judgment Liens to the extent the entry of such judgment does
not constitute a Default or an Event of Default under the terms of this
Agreement or result in the sale or levy of, or execution on, any of the
Collateral; (e) Liens to secure the purchase price of Equipment or Inventory
in an aggregate amount not to exceed Two Hundred Fifty Thousand Dollars
($250,000); and (f) such other Liens, if any, as are set forth on Schedule
4.1.18 attached hereto and made a part hereof.

       "Permitted Uses" means short term working capital of any Borrower's
business, to support the issuance of Letters of Credit and any Permitted
Acquisitions.

       "Person" means and includes an individual, a corporation, a
partnership, a joint venture, a limited liability company or partnership, a
trust, an unincorporated association, a Governmental Authority, or any other
organization or entity.

       "Plan" means any pension plan that is covered by Title IV of ERISA and
in respect of which any Borrower or a Commonly Controlled Entity is an
"employer" as defined in Section 3 of ERISA.

       "Post-Default Rate" means the sum of (a) the Base Rate in effect from
time to time plus (b) two percent (2.0%) per annum.

       "Prepayment" means a Revolving Loan Mandatory Prepayment, a Revolving
Loan Optional Prepayment, a Swing Line Loan Mandatory Prepayment, or a Swing
Line Loan Optional Prepayment, as the case may be, and "Prepayments" mean
collectively all Revolving Loan Mandatory Prepayments, all Revolving Loan
Optional Prepayments, all Swing Line Loan Mandatory Prepayments and all Swing
Line Loan Optional Prepayments.

       "Principal Amount" means the aggregate outstanding principal balance of
the Notes.

       "Prime Rate" means the rate of interest established from time to time
by the Agent and announced by the Agent as its prime rate.  The Prime Rate is
not necessarily the lowest or most favorable rate of interest charged by the
Agent on extensions of credit to debtors.

       "Proceeds" has the meaning described in the Uniform Commercial Code as
in effect from time to time.

       "Pro-forma Balance Sheet" has the meaning described in Section 4.1
(Pro-forma Financial Statements).

       "Pro-forma Financial Projections" has the meaning described in Section
4.1 (Pro-forma Financial Statements).

       "Pro Rata Share" means at any time and as to any Lender, the percentage
derived by dividing the unpaid principal amount of the Loans and Letter of
Credit Obligations owing to that Lender by the aggregate unpaid principal
amount of all Loans and Letter of Credit Obligations then outstanding; or if
no Loans or Letter of Credit Obligations are outstanding, by dividing the
total amount of such Lender's Commitments by the total amount of the
Commitments of the Agent and all of the Lenders.

       "Purchase Agreement Documents" means collectively any agreement
hereafter executed in connection with any Permitted Acquisition and any and
all other agreements, documents or instruments (together with any and all
amendments, modifications, and supplements thereto, restatements thereof, and
substitutes therefor) previously, now or hereafter executed and delivered by
any Borrower or any other Person in connection with any Permitted
Acquisition.

       "Rate Request Notice" has the meaning described in Section 2.4.3(e)
(Selection of Interest Rates on Revolving Loans)

       "Rate Request Amount" means the amount, to be specified by the
Borrowers, through their agent VSE, in each Rate Request Notice, which the
Borrowers desire bear interest at the specified Applicable Interest Rate.

       "Receivable" means one of each Borrower's now owned and hereafter
owned, acquired or created Accounts, Chattel Paper, General Intangibles and
Instruments; and "Receivables" means all of each Borrower's now or hereafter
owned, acquired or created Accounts, Chattel Paper, General Intangibles and
Instruments, and all cash and non-cash proceeds and products thereof.

       "Replacement Revolving Credit Note" has the meaning described in
Section 2.1.5 (Revolving Credit Note).

       "Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA or the regulations thereunder.

       "Responsible Officer" means for each Borrower, its chief executive
officer or president or, with respect to financial matters, its chief
financial officer, or treasurer.

       "Requisite Lenders" means at any time of determination one or more of
the Lenders holding at least fifty-one percent (51%) of the Commitments,
provided, that, at any time of determination there are (a) two Lenders, then
one hundred percent (100%) of the Commitments and (b) at least three Lenders,
then at least two Lenders holding a minimum of fifty-one percent (51%) of the
Commitments.

       "Revolving Credit Commitment" means the agreement of a Lender relating
to the making the Revolving Loan and advances thereunder subject to and in
accordance with the provisions of this Agreement; and "Revolving Credit
Commitments" means the collective reference to the Revolving Credit
Commitment of each of the Lenders.

       "Revolving Credit Commitment Period" means the period of time from the
Closing Date to the Business Day preceding the Revolving Credit Termination
Date.

       "Revolving Credit Committed Amount" has the meaning described in
Section 2.1.1 (Revolving Credit Facility) as increased, from time to time,
pursuant to Section 2.1.6 (Increase to Revolving Credit Facility).

       "Revolving Credit Expiration Date" means August 26, 2011.

       "Revolving Credit Facility" means the facility established by the
Lenders pursuant to Section 2.1 (Revolving Credit Facility).

       "Revolving Credit Note" and "Revolving Credit Notes" have the meanings
described in Section 2.1.5 (Revolving Credit Notes).

       "Revolving Credit Optional Reduction" and "Revolving Credit Optional
Reductions" have the meanings described in Section 2.1.13 (Optional Reduction
of Total Revolving Credit Committed Amount).

       "Revolving Credit Pro Rata Share" has the meaning described in Section
2.1.1 (Revolving Credit Facility).

       "Revolving Credit Termination Date" means the earlier of (a) the
Revolving Credit Expiration Date, or (b) the date on which the Revolving
Credit Commitments are terminated pursuant to Section 7.2 (Remedies) or
otherwise.

       "Revolving Credit Unused Line Fee" and "Revolving Credit Unused Line
Fees" have the meanings described in Section 2.1.11 (Revolving Credit Unused
Line Fee).

       "Revolving Loan" has the meaning described in Section 2.1.1 (Revolving
Credit Facility).

       "Revolving Loan Account" has the meaning described in Section 2.1.10
(Revolving Loan Account).

       "Revolving Loan Mandatory Prepayment" and "Revolving Loan Mandatory
Prepayments" have the meanings described in Section 2.1.6 ((Mandatory
Prepayments of Revolving Loan).

       "Revolving Loan Optional Prepayment" and "Revolving Loan Optional
Prepayments" have the meanings described in Section 2.1.8 (Optional
Prepayment of Revolving Loan).

       "Sanctioned Country" means a country subject to a sanctions program
identified on the list maintained by OFAC and available at
http://www.treas.gov/offices/enforcement/ofac/sanctions/, or as otherwise
published from time to time.

       "Sanctioned Person" means (i) a person named on the list of Specially
Designated Nationals or Blocked Persons maintained by OFAC available at
http://www.treas.gov/offices/enforcement/ofac/sdn or as otherwise published
from time to time, or (ii) (A) an agency of the government of a Sanctioned
Country, (B) an organization controlled by a Sanctioned Country, or (C) a
person resident in a Sanctioned Country to the extent subject to a sanctions
program administered by OFAC.

       "Security Documents" means collectively any assignment, pledge
agreement, security agreement, mortgage, deed of trust, deed to secure debt,
financing statement and any similar instrument, document or agreement under
or pursuant to which a Lien is now or hereafter granted to, or for the
benefit of, the Agent and/or the Lenders on any real or personal property of
any Person to secure all or any portion of the Obligations, all as the same
may from time to time be amended, restated, supplemented or otherwise
modified, including, without limitation, this Agreement.

       "Settlement Date" means each Business Day after the Closing Date
selected by the Agent in its sole discretion subject to and in accordance
with the provisions of Section 2.6.2 (Settlement Procedures as to Revolving
Loan) as of which a Settlement Report is delivered by the Agent and on which
settlement is to be made among the Lenders in accordance with the provisions
of Section 2.5.8 (Payments).

       "Settlement Report" means each report prepared by the Agent and
delivered to each Lender and setting forth, among other things, as of the
Settlement Date indicated thereon and as of the next preceding Settlement
Date, the aggregate outstanding principal balance of the Revolving Loan, each
Lender's Revolving Credit Pro Rata Share thereof, each Lender's Net
Outstandings and all Non-Ratable Loans made, and all payments of principal,
interest and Fees received by the Agent from the Borrowers during the period
beginning on such next preceding Settlement Date and ending on such
Settlement Date.

       "Solvent" means when used with respect to any Person that at the time
of determination:
                      (a)     the assets of such Person, at a fair
valuation, are in excess of the total amount of its debts
(including, without limitation, contingent liabilities); and
                      (b)     the present fair saleable value of its
assets is greater than its probable liability on its existing
debts as such debts become absolute and matured; and
                      (c)     it is then able and expects to be able to
pay its debts (including, without limitation, contingent debts
and other commitments) as they mature; and
                      (d)     it has capital sufficient to carry on its
business as conducted and as proposed to be conducted.

       For purposes of determining whether a Person is Solvent, the amount of
any contingent liability shall be computed as the amount that, in light of
all the facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured liability.

       "State" means the Commonwealth of Virginia.

       "Stock Pledge Agreements" means those certain Pledge, Assignment and
Security Agreements, dated the Closing Date, from VSE to Agent for the
benefit of Lenders ratably and Agent, as the same may from time to time be
amended, restated, supplemented or otherwise modified.

       "Subordinated Indebtedness" means all Indebtedness, incurred at any
time by any one or more of the Borrowers, which is in amounts, subject to
repayment terms, and subordinated to the Obligations, as set forth in one or
more written agreements, all in form and substance satisfactory to the Agent
in its sole and absolute discretion.

       "Subsidiary" means any corporation the majority of the voting shares of
which at the time are owned directly by any Borrower and/or by one or more
Subsidiaries of any Borrower.

       "Supporting Obligation" means a letter-of-credit right, secondary
obligation or obligation of a secondary obligor or that supports the payment
or performance of an account, chattel paper, a document, a general
intangible, an instrument or investment property.

       "Swap Reserve" means any and all reserves which the Agent from time to
time establishes, in its sole discretion, with respect to Swap Transactions.

       "Swap Transactions" means any interest rate swap transaction, forward
rate transaction, treasury lock transaction, interest rate cap, floor or
collar transaction, any similar transaction, any option to enter into any of
the foregoing, or any combination of any of the foregoing.

       "Swing Line Commitment" means the agreement of Citizens relating to the
making the Swing Line Loan and advances thereunder subject to and in
accordance with the provisions of this Agreement.

       "Swing Line Commitment Period" means the period of time from the
Closing Date to the Business Day preceding the Swing Line Termination Date.

       "Swing Line Committed Amount" has the meaning described in Section 2.3
(Swing Line Sub-Facility).

       "Swing Line Expiration Date" means August 26, 2011.

       "Swing Line Sub-Facility" means the sub-facility established by
Citizens pursuant to Section 2.3. (Swing Line Sub-Facility).

       "Swing Line Loan" and "Swing Line Loans" have the meaning described in
Section Section 2.3 (Swing Line Loans).

       "Swing Line Loan Mandatory Prepayment" and "Swing Line Loan Mandatory
Prepayments" have the meanings described in Section 2.3.9 (Mandatory
Prepayments of Swing Line Loan).

       "Swing Line Loan Optional Prepayment" and "Swing Line Loan Optional
Prepayments" have the meanings described in Section 2.3.10 (Optional
Prepayment of Swing Line Loan).

       "Swing Line Note" has the meaning described in Section 2.3.7 (Swing
Line Note).

       "Swing Line Termination Date" means the earlier of (a) the Swing Line
Expiration Date, or (b) the date on which the Swing Line Commitment is
terminated pursuant to Section 7.2 (Remedies) or otherwise.

       "Target" has the meaning described in the definition of Permitted
Acquisitions.

       "Taxes" means all taxes and assessments whether general or special,
ordinary or extraordinary, or foreseen or unforeseen, of every character
(including all penalties or interest thereon), which at any time may be
assessed, levied, confirmed or imposed by any Governmental Authority on any
or all of the Borrowers or any of its or their properties or assets or any
part thereof or in respect of any of its or their franchises, businesses,
income or profits.

       "Total Funded Debt" means as to Borrowers for any period of
determination thereof the sum of (i) all Indebtedness for Borrowed Money of
Borrowers, plus (ii) any accrued earn out payments of Borrowers (net of any
Cash Equivalents for purposes of calculating accrued earn out payments of
Borrowers).

       "Total Revolving Credit Committed Amount" has the meaning described in
Section 2.1.1 (Revolving Credit Facility) as increased, from time to time,
pursuant to Section 2.1.6 (Increase to Revolving Credit Facility).

       "Trademarks" means and includes in each case whether now existing or
hereafter arising, all of each Borrower's rights, title and interest in and
to (a) any and all trademarks (including service marks), trade names and
trade styles, and applications for registration thereof and the goodwill of
the business symbolized by any of the foregoing, (b) any and all licenses of
trademarks, service marks, trade names and/or trade styles, whether as
licensor or licensee, (c) any renewals of any and all trademarks, service
marks, trade names, trade styles and/or licenses of any of the foregoing, (d)
income, royalties, damages and payments now or hereafter due and/or payable
with respect thereto, including, without limitation, damages, claims, and
payments for past, present and future infringements thereof, (e) rights to
sue for past, present and future infringements of any of the foregoing,
including the right to settle suits involving claims and demands for
royalties owing, and (f) all rights corresponding to any of the foregoing
throughout the world.

       "Unearned Contract Value" means the difference between (a) the then
fully funded dollar value of the contract or subcontract, whether or not
earned, and (b) the total amounts previously billed and properly billable for
accepted end items or services.

       "Uniform Commercial Code" means, unless otherwise provided in this
Agreement, the Uniform Commercial Code as adopted by and in effect from time
to time in the State or in any other jurisdiction, as applicable.

       "Unused Fee Margin" means that per annum percentage rate determined by
Agent from time to time in accordance with the following matrix: 

            Unused Fee Margin          Leverage Ratio
            -----------------    --------------
                 0.25%            Less than 1.00 to 1.0

                 0.35%            Equal to or greater than 1.00 to 1.0
                              but less than 2.00 to 1.0

                 0.50%        Equal to or greater than 2.00 to 1.0

       "Wholly Owned Subsidiary" means any domestic United States corporation
all the shares of stock of all classes of which (other than directors'
qualifying shares) at the time are owned directly or indirectly by a Borrower
and/or by one or more Wholly Owned Subsidiaries of a Borrower.

       Section 1.2      Accounting Terms and Other Definitional Provisions.
                        ---------------------------------------------------

       Unless otherwise defined herein, as used in this Agreement and in any
certificate, report or other document made or delivered pursuant hereto,
accounting terms not otherwise defined herein, and accounting terms only
partly defined herein, to the extent not defined, shall have the respective
meanings given to them under GAAP, as consistently applied to the applicable
Person.  All terms used herein which are defined by the Uniform Commercial
Code shall have the same meanings as assigned to them by the Uniform
Commercial Code unless and to the extent varied by this Agreement.  The words
"hereof", "herein" and "hereunder" and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement, and article, section, subsection,
schedule and exhibit references are references to articles, sections or
subsections of, or schedules or exhibits to, as the case may be, this
Agreement unless otherwise specified.  As used herein, the singular number
shall include the plural, the plural the singular and the use of the
masculine, feminine or neuter gender shall include all genders, as the
context may require.  Reference to any one or more of the Financing Documents
shall mean the same as the foregoing may from time to time be amended,
restated, substituted, extended, renewed, supplemented or otherwise modified. 
Reference in this Agreement and the other Financing Documents to the
"Borrower", the "Borrowers", "each Borrower" or otherwise with respect to any
one or more of the Borrowers shall mean each and every Borrower and any one
or more of the Borrowers, jointly and severally, unless a specific Borrower
is expressly identified.

                                  ARTICLE II
                            THE CREDIT FACILITIES
                            ---------------------
       Section 2.1    The Revolving Credit Facility.
                      ------------------------------
                      2.1.1   Revolving Credit Facility.
                                --------------------------
                      Subject to and upon the provisions of this Agreement, the
Lenders collectively, but severally, establish a revolving credit facility
(the "Revolving Credit Facility") in favor of the Borrowers.  The aggregate
of all advances under the Revolving Credit Facility, including any advances
under the Incremental Revolving Commitment, is sometimes referred to in this
Agreement collectively as the "Revolving Loan".

                      The amount set forth below opposite each Lender's name is
herein called such Lender's "Revolving Credit Committed Amount" and the total
of each Lender's Revolving Credit Committed Amount is herein called the
"Total Revolving Credit Committed Amount".  Each Lender's Revolving Credit
Committed Amount and the Total Revolving Credit Committed Amount may be
increased by the amount, if any, of each Lender's Incremental Revolving
Commitment pursuant to Section 2.1.6 and all times thereafter all references
herein to each Lender's Revolving Credit Committed Amount and the Total
Revolving Credit Committed Amount shall include the amount of each Lender's
Incremental Revolving Commitment.  The proportionate share set forth below
opposite each Lender's name is herein called such Lender's "Revolving Credit
Pro Rata Share":

                        Revolving Credit         Revolving Credit
      Lender                      Committed Amount            Pro Rata Share
        ------                  ----------------                --------------
        Citizens                  $35,000,000                    70%
      SunTrust            $15,000,000                      30%
     Total Revolving Credit
        Committed Amount          $50,000,000                   100%

                      Neither the Agent nor any of the Lenders shall be
responsible for the Revolving Credit Commitment of any other Lender, nor will
the failure of any Lender to perform its obligations under its Revolving
Credit Commitment in any way relieve any other Lender from performing its
obligations under its Revolving Credit Commitment.

                      During the Revolving Credit Commitment Period, any or all
of the Borrowers may request advances under the Revolving Credit Facility in
accordance with the provisions of this Agreement; provided that after giving
effect to any Borrower's request:

                      (a)     the outstanding principal balance of each
Lender's Pro Rata Share would not exceed the lesser of (i) such
Lender's Revolving Credit Pro Rata Share of the Revolving Credit
Committed Amount or (ii) such Lender's Pro Rata Share of the
Borrowing Base; and,

                      (b)     the aggregate outstanding principal
balance of the Revolving Loan, the Swing Line Loan and all Letter
of Credit Obligations would not exceed the lesser of (i) the
Total Revolving Credit Committed Amount or (ii) the Borrowing
Base.

                      2.1.2   Procedure for Making Advances Under the
                        ---------------------------------------
Revolving Loan; Lender Protection Loans.
----------------------------------------
                      The Borrowers may borrow under the Revolving Credit
Facility on any Business Day.  Advances under the Revolving Loan shall be
deposited to a demand deposit account of a Borrower with the Agent or shall
be otherwise applied as directed by the Borrowers, which direction the Agent
may require to be in writing.  Not later than 1:00 p.m. (Eastern Time) on the
date of the requested borrowing, the Borrowers shall give the Agent oral or
written notice (a "Loan Notice") of the amount and (if requested by the
Agent) the purpose of the requested borrowing and if requested by the Agent,
be accompanied by a Borrowing Base Report.  Any oral Loan Notice shall be
confirmed in writing by the Borrowers within three (3) Business Days after
the making of the requested advance under the Revolving Loan.  Each Loan
Notice shall be irrevocable.  Upon receipt of any such Loan Notice, the Agent
shall promptly notify each Lender of the amount of each advance to be made by
such Lender on the requested borrowing date under such Lender's Revolving
Credit Commitment.

                      Not later than 2:00 p.m. (Eastern Time) on each requested
borrowing date for the making of advances under the Revolving Loan, each
Lender shall, if it has received timely notice from the Agent of the
Borrowers' request for such advances, make available to the Agent, in funds
immediately available to the Agent at the Agent's office set forth in Section
9.1 (Notices), such Lender's Pro Rata Share of the advances to be made on
such date.

                      In addition, each of the Borrowers hereby irrevocably
authorizes the Lenders at any time and from time to time, without further
request from or notice to the Borrowers, to make advances under the Revolving
Loan, and irrevocably authorizes the Agent to establish, without duplication,
reserves against the Borrowing Base, which the Agent, in its sole and
absolute discretion, deems necessary or appropriate to protect the interests
of the Agent and/or any or all of the Lenders under this Agreement,
including, without limitation, advances and reserves under the Revolving Loan
made to cover shortages, debit balances or overdrafts in the Revolving Loan
Account, principal of, and/or interest on, any Loan, the Obligations
(including, without limitation, any Letter of Credit Obligations), and/or
Enforcement Costs, prior to, on, or after the termination of other advances
under this Agreement, regardless of whether the outstanding principal amount
of the Revolving Loan that the Lenders may advance or the Agent may reserve
hereunder exceeds the Total Revolving Credit Committed Amount or the
Borrowing Base.

                      2.1.3   Borrowing Base.
                        ---------------
                      As used in this Agreement, the term "Borrowing Base" means
at any time, an amount equal to the sum of (i) ninety percent (90%) of
Eligible Receivables that arise from obligations due under and from
Government Contracts and (ii) eighty percent (80%) of the amount of Eligible
Receivables that arise from obligations other than due under and from
Government Contracts.

                      The Borrowing Base shall be computed based on the
Borrowing Base Report most recently delivered to and accepted by the Agent in
its sole and absolute discretion.  In the event the Borrowers fail to furnish a
Borrowing Base Report required by Section 2.1.4 (Borrowing Base Report), or
in the event the Agent believes that a Borrowing Base Report is no longer
accurate, the Agent may, in its sole and absolute discretion exercised from
time to time and without limiting other rights and remedies under this
Agreement, direct the Lenders to suspend the making of or limit advances
under the Revolving Loan and Citizens may, in its sole and absolute
discretion exercised from time to time, suspend the making or limit advances
under the Swing Line Loan.  The Agent may reduce the Borrowing Base by
amounts credited to the Collateral Account since the date of the most recent
Borrowing Base Report and by the amount of any Receivable which was included
in the Borrowing Base but which the Agent determines fails to meet the
respective criteria applicable from time to time for Eligible Receivables.

                      If at any time the total of the aggregate principal amount
of the Revolving Loan, the Swing Line Loan and Outstanding Letter of Credit
Obligations exceeds the Borrowing Base, a borrowing base deficiency
("Borrowing Base Deficiency") shall exist.  Each time a Borrowing Base
Deficiency exists, the Borrowers shall immediately upon notice from Agent pay
the Borrowing Base Deficiency to the Agent first to pay Citizens until the
Obligations under the Swing Line Loan have been paid in full and then for the
benefit of the Lenders from time to time.

                      Without implying any limitation on the Agent's discretion
with respect to the Borrowing Base, the criteria for Eligible Receivables
contained in the definition of Eligible Receivables are in part based upon
the business operations of the Borrowers existing on or about the Closing
Date and upon information and records furnished to the Agent by the
Borrowers.  If at any time or from time to time hereafter, the business
operations of the Borrowers change or such information and records furnished
to the Agent is incorrect or misleading, the Agent in its discretion, may at
any time and from time to time during the duration of this Agreement change
such criteria or add new criteria.  The Agent may communicate such changed or
additional criteria to the Borrowers from time to time either orally or in
writing.

                      2.1.4   Borrowing Base Report.
                        ----------------------
                      The Borrowers will furnish to the Agent no less frequently
than monthly before the 30th day of each month and at such other times as may
be requested by the Agent or any of the Lenders a report of the Borrowing
Base (each a "Borrowing Base Report"; collectively, the "Borrowing Base
Reports") in the form required from time to time by the Agent, appropriately
completed and duly signed.  The Borrowing Base Report shall contain the net
amount due on the Receivables, and the calculations of the Borrowing Base,
all in such detail, and accompanied by such supporting and other information,
as the Agent may from time to time request.  Upon the Agent's request and
upon the creation of any Receivables, or at such intervals as the Agent may
require, the Borrowers will provide the Agent with (a) confirmatory
assignment schedules; (b) copies of Account Debtor invoices; (c) evidence of
shipment or delivery; and (d) such further schedules, documents and/or
information regarding the Receivables as the Agent may reasonably require.
The items to be provided under this subsection shall be in form satisfactory
to the Agent, and certified as true and correct by a Responsible Officer, and
delivered to the Agent from time to time solely for the Agent's convenience
in maintaining records of the Collateral.  Any Borrower's failure to deliver
any of such items to the Agent shall not affect, terminate, modify, or
otherwise limit the Liens of the Agent and the Lenders in the Collateral.

                      2.1.5   Revolving Credit Notes.
                        -----------------------
                      The obligation of the Borrowers to pay each Lender's Pro
Rata Share of the Revolving Loan, with interest, shall be evidenced by a
series of promissory notes (as from time to time extended, amended, restated,
supplemented or otherwise modified, collectively the "Revolving Credit Notes"
and individually a "Revolving Credit Note") substantially in the form of
Exhibit B-1 attached hereto and made a part hereof, with appropriate
insertions. One or more of the Revolving Credit Notes may, pursuant to
Section 2.1.6 of this Agreement, be increased and replaced in their entirety
with one or more promissory notes (as from time to time extended, amended,
restated, supplemented or otherwise modified, collectively, the "Replacement
Revolving Credit Notes" and individually a "Replacement Revolving Credit
Note") substantially in the form of Exhibit B-2 attached hereto and made a
part hereof.  Each Lender's Revolving Credit Note shall be dated as of the
Closing Date, shall be payable to the order of such Lender at the times
provided in the Revolving Credit Note, and shall be in the principal amount
of such Lender's Revolving Credit Pro Rata Share.

                      Each of the Borrowers acknowledges and agrees that, if the
outstanding principal balance of the Revolving Loan outstanding from time to
time exceeds the aggregate face amount of the Revolving Credit Notes, the
excess shall bear interest at the rates provided from time to time for
advances under the Revolving Loan evidenced by the Revolving Credit Notes and
shall be payable, with accrued interest, ON DEMAND.

                      2.1.6   Increase to Revolving Credit Facility.
                        --------------------------------------
                      Lenders may, in their sole discretion, agree to increase
the amount of each Lender's Revolving Credit Committed Amount (the
"Incremental Revolving Commitment") to make incremental revolving credit
loans available to Borrowers (the "Incremental Revolving Loans") by executing
and delivering to Agent a duly executed Increased Revolving Facility
Activation Notice specifying the (i) amount of such increase and (ii) the
Increased Revolving Facility Closing Date, provided, however, at the time of
said election, no Default or Event of Default has occurred and is continuing. 
An Increased Revolving Facility Activation Notice that has been executed and
delivered to Agent may not be rescinded without the consent of the Requisite
Lenders.  Notwithstanding the foregoing, without the consent of the Requisite
Lenders, (i) each request for Incremental Revolving Loans shall be in
increments of not less than Five Million Dollars ($5,000,000), (ii) the
aggregate amount of the Incremental Revolving Commitment shall not exceed
Twenty-Five Million Dollars ($25,000,000) and (iii) the aggregate amount of
the Total Revolving Credit Committed Amount, as may be increased by the
amount, if any, of each Lender's Incremental Revolving Commitment pursuant to
this Section 2.1.6 shall not exceed Seventy-Five Million Dollars
($75,000,000) at any time.  Not later than the Increased Revolving Facility
Closing Date, Borrowers shall have delivered to Agent one or more duly
executed and completed Replacement Revolving Credit Notes which reflects the
amount of the Revolving Credit Committed Amount after giving effect to such
increase. 

                      2.1.7   Mandatory Prepayments of Revolving Loan.
                        ----------------------------------------
                      The Borrowers shall make the mandatory prepayments (each a
"Revolving Loan Mandatory Prepayment" and collectively, the "Revolving Loan
Mandatory Prepayments") of the Revolving Loan at any time and from time to
time in such amounts requested by the Agent pursuant to Section 2.1.3
(Borrowing Base) in order to cover any Borrowing Base Deficiency.

                      2.1.8   Optional Prepayments of Revolving Loan.
                                ---------------------------------------
                      The Borrowers shall have the option at any time and from
time to time to prepay (each a "Revolving Loan Optional Prepayment" and
collectively the "Revolving Loan Optional Prepayments") the Revolving Loan,
in whole or in part without premium or penalty, other than with respect to
any indemnification and reimbursement obligations pursuant to Section 2.4.5.

                      2.1.9   The Collateral Account.
                        -----------------------
                      Upon request of the Agent after the occurrence of a
Default, the Borrowers will deposit, or cause to be deposited, all Items of
Payment to a bank account designated by the Agent and from which the Agent
alone has power of access and withdrawal (the "Collateral Account").  Each
deposit shall be made not later than the next Business Day after the date of
receipt of the Items of Payment.  The Items of Payment shall be deposited in
precisely the form received, except for the endorsements of the Borrowers
where necessary to permit the collection of any such Items of Payment, which
endorsement the Borrowers hereby agree to make.  In the event the Borrowers
fail to do so, the Borrowers hereby authorize the Agent to make the
endorsement in the name of any or all of the Borrowers.  Prior to such a
deposit, the Borrowers will not commingle any Items of Payment with any of
the Borrowers' other funds or property, but will hold them separate and apart
in trust and for the account of the Agent for the benefit of the Lenders
ratably and the Agent.

                      In addition, if so directed by the Agent, the Borrowers
shall direct the mailing of all Items of Payment from their Account Debtors
to one or more post-office boxes designated by the Agent, or to such other
additional or replacement post-office boxes pursuant to the request of the
Agent from time to time (collectively, the "Lockbox").  The Agent shall have
unrestricted and exclusive access to the Lockbox.

                      The Borrowers hereby authorize the Agent after the
occurrence of a Default to inspect all Items of Payment, endorse all Items of
Payment in the name of any or all of the Borrowers, and deposit such Items of
Payment in the Collateral Account.  The Agent reserves the right, exercised
in its sole and absolute discretion from time to time, to provide to the
Collateral Account credit prior to final collection of an Item of Payment and
to disallow credit for any Item of Payment which is unsatisfactory to the
Agent.  In the event Items of Payment are returned to the Agent for any
reason whatsoever, the Agent may, in the exercise of its discretion from time
to time, forward such Items of Payment a second time.  Any returned Items of
Payment shall be charged back to the Collateral Account, the Revolving Loan
Account, or other account, as appropriate.

                      The Agent will after the occurrence of a Default apply the
whole or any part of the collected funds credited to the Collateral Account
against the Revolving Loan (or with respect to Items of Payment which are not
proceeds of Accounts or Inventory or after an Event of Default, against any
of the Obligations) or credit such collected funds to a depository account of
any or all of the Borrowers with the Agent, the order and method of such
application to be in the sole discretion of the Agent.

                      2.1.10  Revolving Loan Account.
                        -----------------------
                      The Agent will establish and maintain a loan account on
its books (the "Revolving Loan Account") to which the Agent will (a) debit (i)
the principal amount of each advance under the Revolving Loan made by the
Lenders hereunder as of the date made, (ii) the amount of any interest
accrued on the Revolving Loan as and when due, and (iii) any other amounts
due and payable by the Borrowers to the Agent and/or the Lenders from time to
time under the provisions of this Agreement in connection with the Revolving
Loan, including, without limitation, Enforcement Costs, Fees, late charges,
and service, collection and audit fees, as and when due and payable, and (b)
credit all payments made by the Borrowers to the Agent on account of the
Revolving Loan as of the date made.  The Agent may debit the Revolving Loan
Account for the amount of any Item of Payment that is returned to the Agent
unpaid.  All credit entries to the Revolving Loan Account are conditional and
shall be readjusted as of the date made if final and indefeasible payment is
not received by the Agent in cash or solvent credits.  The Borrowers hereby
promise to pay to the order of the Agent for the ratable benefit of the
Lenders, ON DEMAND, an amount equal to the excess, if any, of all debit
entries over all credit entries recorded in the Revolving Loan Account under
the provisions of this Agreement.  Any and all periodic or other statements
or reconciliations, and the information contained in those statements or
reconciliations, of the Revolving Loan Account shall be presumed conclusively
to be correct, and shall constitute an account stated between the Agent, the
Lenders and the Borrowers unless the Agent receives specific written
objection thereto from any Borrower and/or any Lender within thirty (30)
Business Days after such statement or reconciliation shall have been sent by
the Agent.  Any and all periodic or other statements or reconciliations, and
the information contained in those statements or reconciliations, of the
Revolving Loan Account shall be final, binding and conclusive upon the
Borrowers in all respects, absent manifest error, unless the Agent receives
specific written objection thereto from the Borrowers within thirty (30)
Business Days after such statement or reconciliation shall have been sent by
the Agent.

                      2.1.11  Revolving Credit Unused Line Fee.
                        ---------------------------------
                      Borrowers shall pay to Agent for the ratable benefit of
Lenders a revolving credit facility fee (collectively, the "Revolving Credit
Unused Line Fees" and individually, a "Revolving Credit Unused Line Fee") in
an amount equal to the Unused Fee Margin multiplied by the average daily
unused and undisbursed portion of the Revolving Credit Committed Amount in
effect from time to time accruing during each calendar quarter.  For purposes
of clarification, the outstanding amount of any Swing Line Loan shall not be
considered usage of the Revolving Credit Committed Amount, while the face
amount of outstanding Letters of Credit shall be considered usage of the
Revolving Credit Committed Amount.  The accrued and unpaid portion of the
Revolving Credit Unused Line Fee shall be paid quarterly in arrears by
Borrowers to Agent on the last day of each quarter, commencing on the first
such date following the date hereof, and on the Revolving Credit Termination
Date.

                      2.1.12  Required Availability under the Revolving Credit
                        ------------------------------------------------
Facility.
---------
                      On the Closing Date, the aggregate outstanding principal
amount of the Revolving Loan, including any Swing Line Loans, and Outstanding
Letter of Credit Obligations shall not exceed an amount equal to (a) the
lesser of the Borrowing Base or the Total Revolving Credit Committed Amount,
minus (b) Ten Million Dollars ($10,000,000).  Borrowers shall make a
Revolving Loan Mandatory Prepayment pursuant to the provisions of Section
2.1.7 (Mandatory Prepayments of Revolving Loan) to the extent necessary to
achieve compliance with this Section.

                      2.1.13  Optional Reduction of Total Revolving Credit
                        --------------------------------------------
Committed Amount.
-----------------
                      The Borrowers shall have the right to reduce permanently
(each a "Revolving Credit Optional Reduction" and collectively the "Revolving
Credit Optional Reductions") the Total Revolving Credit Committed Amount in
effect from time to time in the amount of any integral multiple of Five
Million Dollars ($5,000,000), upon at least fifteen (15) Business Days prior
written notice to the Agent specifying the date and amount of such Revolving
Credit Optional Reduction; provided, that no Revolving Credit Optional
Reduction shall be permitted if, (i) after giving effect thereto and to any
Revolving Loan Optional Prepayment made on the effective date thereof, the
then outstanding principal amount of the Revolving Loan and Outstanding
Letter of Credit Obligations exceeds the Total Revolving Credit Committed
Amount as so reduced or (ii) after giving effect to such Revolving Credit
Optional Reduction there is not at least Ten Million Dollars ($10,000,000) of
availability under the Revolving Loan.  Such notice shall be irrevocable as
to the amount and date of such Revolving Credit Optional Reduction.

       Section 2.2      The Letter of Credit Sub-Facility.
                  ----------------------------------
                      2.2.1   Letters of Credit.
                        ------------------
                      Subject to and upon the provisions of this Agreement, and
as a part of the Revolving Credit Commitments, each of the Borrowers, upon
the prior approval of the Agent, may obtain standby letters of credit (as the
same may from time to time be amended, supplemented or otherwise modified,
each a "Letter of Credit" and collectively the "Letters of Credit") from the
Agent from time to time from the Closing Date until the Business Day
preceding the Revolving Credit Termination Date.  The Borrowers will not be
entitled to obtain a Letter of Credit unless (a) the Borrowers are then able
to obtain a Revolving Loan from the Lenders in an amount not less than the
proposed face amount of the Letter of Credit requested by the Borrowers, and
(b) the sum of the then Outstanding Letter of Credit Obligations (including
the amount of the requested Letter of Credit), unless otherwise agreed to by
the Lenders, does not exceed Fifteen Million Dollars ($15,000,000).

                      2.2.2   Letter of Credit Fees.
                        ----------------------
                      With respect to each Letter of Credit, the Borrowers shall
pay to the Agent, for its own account, an amount equal to the Letter of
Credit Issuance Fee multiplied by the face amount of each Letter of Credit
all without regard for provisions contained in the Letters of Credit which
may give rise to a reduction in the stated amount thereof unless such
reduction has actually occurred (collectively, the "Letter of Credit Fees"). 
The Letter of Credit Fees shall be paid upon the opening of each Letter of
Credit and on the last day of each fiscal quarter thereafter, if any, at the
per annum rate.  In addition, the Borrowers shall pay to the Agent all other
reasonable and customary amendment, negotiation, processing, transfer or
other fees to the extent and as and when required by the provisions of any
Letter of Credit Agreement.  All Letter of Credit Fees and all such other
additional fees are included in and are a part of the "Fees" payable by the
Borrowers under the provisions of this Agreement and are for the sole and
exclusive benefit of the Agent and are a part of the Agent's Obligations.

                      2.2.3   Terms of Letters of Credit; Post-Expiration Date
                        -----------------------------------------------
                        Letters of Credit.
                        ------------------
                      Each Letter of Credit shall (a) be opened pursuant to a
Letter of Credit Agreement and (b) expire on a date not later than the
Business Day preceding the Revolving Credit Expiration Date; provided,
however, if any Letter of Credit does have an expiration date later than the
Business Day preceding the Revolving Credit Termination Date (each a "Post-
Expiration Date Letter of Credit" and collectively, the "Post-Expiration Date
Letters of Credit"), effective as of the Business Day preceding the Revolving
Credit Termination Date and without prior notice to or the consent of the
Borrowers, the Lenders shall make advances under the Revolving Loan for the
account of the Borrowers in the aggregate face amount of all such Letters of
Credit.  The Agent may in its sole and absolute discretion issue or refuse to
issue any Letter of Credit which is automatically renewable or "evergreen". 
The amount of each Lender's advance shall be equal to its Revolving Credit
Pro Rata Share of the aggregate face amount of all such Letters of Credit. 
The Agent shall deposit the proceeds of such advances into one or more non-
interest bearing accounts with and in the name of the Agent and over which
the Agent alone shall have exclusive power of access and withdrawal
(collectively, the "Letter of Credit Cash Collateral Account").  The Letter
of Credit Cash Collateral Account is to be held by the Agent, for the ratable
benefit of the Lenders, as additional collateral and security for any Letter
of Credit Obligations relating to the Post-Expiration Date Letters of Credit. 
The Borrowers hereby assign, pledge, grant and set over to the Agent, for the
ratable benefit of the Lenders, a first priority security interest in, and
Lien on, all of the funds on deposit in the Letter of Credit Cash Collateral
Account, together with any and all Proceeds and products thereof as
additional collateral and security for the Letter of Credit Obligations
relating to the Post-Expiration Date Letters of Credit.  The Borrowers
acknowledge and agree that the Agent shall be entitled to fund any draw or
draft on any Post-Expiration Date Letter of Credit from the monies on deposit
in the Letter of Credit Cash Collateral Account without notice to or consent
of the Borrowers or any of the Lenders.  The Borrowers further acknowledge
and agree that the Agent's election to fund any draw or draft on any Post-
Expiration Date Letter of Credit from the Letter of Credit Cash Collateral
shall in no way limit, impair, lessen, reduce, release or otherwise adversely
affect the Borrowers' obligation to pay any Letter of Credit Obligations
under or relating to the Post-Expiration Date Letters of Credit.  At such
time as all Post-Expiration Date Letters of Credit have expired and all
Letter of Credit Obligations relating to the Post-Expiration Date Letters of
Credit have been paid in full, the Agent agrees to apply the amount of any
remaining funds on deposit in the Letter of Credit Cash Collateral Account to
the then unpaid balance of the Obligations under the Revolving Credit
Facility in such order and manner as the Agent shall determine in its sole
and absolute discretion in accordance with the provisions of this Agreement.

                      Each Letter of Credit shall be issued for purposes
acceptable to Agent.  The aggregate face amount of all Letters of Credit at
any one time outstanding and issued by the Agent pursuant to the provisions
of this Agreement, including, without limitation, any and all Post-Expiration
Date Letters of Credit, plus the amount of any unpaid Letter of Credit Fees
and unpaid Letter of Credit Fees accrued or scheduled to accrue thereon, and
less the aggregate amount of all drafts issued under or purporting to have
been issued under such Letters of Credit that have been paid by the Agent and
for which the Agent has been reimbursed by the Borrowers in full in
accordance with Section 2.2.5 (Payments of Letters of Credit) and the Letter
of Credit Agreements, and for which the Agent has no further obligation or
commitment to restore all or any portion of the amounts drawn and reimbursed,
is herein called the "Outstanding Letter of Credit Obligations".

                      2.2.4   Procedures for Letters of Credit.
                        ---------------------------------
                      The Borrowers shall give the Agent written notice at least
five (5) Business Days prior to the date on which the Borrower desires the
Agent to issue a Letter of Credit.  Such notice shall be accompanied by a
duly executed Letter of Credit Agreement specifying, among other things:  (a)
the name and address of the intended beneficiary of the Letter of Credit, (b)
the requested face amount of the Letter of Credit, (c) whether the Letter of
Credit is to be revocable or irrevocable, (d) the Business Day on which the
Letter of Credit is to be opened and the date on which the Letter of Credit
is to expire, (e) the terms of payment of any draft or drafts which may be
drawn under the Letter of Credit, and (f) any other terms or provisions the
Borrowers desire to be contained in the Letter of Credit.  Such notice shall
also be accompanied by such other information, certificates, confirmations,
and other items as the Agent may require to assure that the Letter of Credit
is to be issued in accordance with the provisions of this Agreement and a
Letter of Credit Agreement.  In the event of any conflict between the
provisions of this Agreement and the provisions of a Letter of Credit
Agreement, the provisions of this Agreement shall prevail and control unless
otherwise expressly provided in the Letter of Credit Agreement.  Upon (x)
receipt of such notice, (y) payment of all Letter of Credit Fees and all
other Fees payable in connection with the issuance of such Letter of Credit,
and (z) receipt of a duly executed Letter of Credit Agreement, the Agent
shall process such notice and Letter of Credit Agreement in accordance with
its customary procedures and open such Letter of Credit on the Business Day
specified in such notice.  The Agent shall not be obligated to issue any
Letter of Credit where the expiration date automatically renews or is
"evergreen".

                      2.2.5   Payments of Letters of Credit.
                        ------------------------------
                      The Borrowers hereby promise to pay to the Agent, ON
DEMAND and in United States Dollars, the following which are herein collectively
referred to as the "Current Letter of Credit Obligations":

                      (a)     the amount which the Agent has paid or
will be required to pay under each draft or draw on a Letter of
Credit, whether such demand be in advance of the Agent's payment
or for reimbursement for such payment;

                      (b)     any and all reasonable charges and
expenses which the Agent may pay or incur relative to the Letter
of Credit and/or such draws or drafts; and

                      (c)     interest on the amounts described in (a)
and (b) not paid by the Borrowers as and when due and payable
under the provisions of (a) and (b) above from the day the same
are due and payable until paid in full at the Post-Default Rate.

                      In addition, the Borrowers hereby promise to pay any and
all other Letter of Credit Obligations as and when due and payable in
accordance with the provisions of this Agreement and the Letter of Credit
Agreements.  The obligation of the Borrowers to pay Current Letter of Credit
Obligations and all other Letter of Credit Obligations shall be absolute and
unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment which the Borrowers or any other account
party may have or have had against the beneficiary of such Letter of Credit,
the Agent, any of the Lenders, or any other Person, including, without
limitation, any defense based on the failure of any draft or draw to conform
to the terms of such Letter of Credit, any draft or other document proving to
be forged, fraudulent or invalid, or the legality, validity, regularity or
enforceability of such Letter of Credit, any draft or other documents
presented with any draft, any Letter of Credit Agreement, this Agreement, or
any of the other Financing Documents, all whether or not the Agent or any of
the Lenders had actual or constructive knowledge of the same, and
irrespective of any Collateral, security or guarantee therefor or right of
offset with respect thereto and irrespective of any other circumstances
whatsoever which constitutes, or might be construed to constitute, an
equitable or legal discharge of the Borrowers for any Letter of Credit
Obligations, in bankruptcy or otherwise; provided, however, that the
Borrowers shall not be obligated to reimburse the Agent for any wrongful
payment under such Letter of Credit made as a result of the Agent's willful
misconduct.  The obligation of the Borrowers to pay the Letter of Credit
Obligations shall not be conditioned or contingent upon the pursuit by the
Agent or any other Person at any time of any right or remedy against any
Person which may be or become liable in respect of all or any part of such
obligation or against any Collateral, security or guarantee therefor or right
of offset with respect thereto.

                      The Letter of Credit Obligations shall continue to be
effective, or be reinstated, as the case may be, if at any time payment of
all or any portion of the Letter of Credit Obligations is rescinded or must
otherwise be restored or returned by the Agent or any of the Lenders upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of any
Person, or upon or as a result of the appointment of a receiver, intervenor,
or conservator of, or trustee or similar officer for, any Person, or any
substantial part of such Person's property, all as though such payments had
not been made.

                      2.2.6   Change in Law; Increased Cost.
                        ------------------------------
                      If any change in any law or regulation or in the
interpretation thereof by any court or other Governmental Authority charged
with the administration thereof shall either (a) impose, modify or deem
applicable any reserve, special deposit or similar requirement against
Letters of Credit issued by the Agent, or (b) impose on the Agent or any of
the Lenders any other condition regarding this Agreement or any Letter of
Credit, and the result of any event referred to in clauses (a) or (b) above
shall be to increase the cost to the Agent of issuing, maintaining or
extending the Letter of Credit or the cost to any of the Lenders of funding
any obligation under or in connection with the Letter of Credit (which
increase in cost shall be the result of the Agent's reasonable allocation of
the aggregate of such cost increases resulting from such events), then, upon
demand by the Agent, the Borrowers shall immediately pay to the Agent from
time to time as specified by the Agent, additional amounts which shall be
sufficient to compensate the Agent and the Lenders for such increased cost,
together with interest on each such amount from the date demanded until
payment in full thereof at a rate per annum equal to the then highest current
rate of interest on the Revolving Loan.  A certificate as to such increased
cost incurred by the Agent and/or any of the Lenders, submitted by the Agent
to the Borrowers, shall be conclusive, absent manifest error.

                      2.2.7   General Letter of Credit Provisions.
                        ------------------------------------
                      The Borrowers hereby instruct the Agent to pay any draft
complying with the terms of any Letter of Credit irrespective of any
instructions of the Borrowers to the contrary.  The Borrowers assume all
risks of the acts and omissions of the beneficiary and other users of any
Letter of Credit.  The Agent, the Lenders and their respective branches,
Affiliates and/or correspondents shall not be responsible for and the
Borrowers hereby indemnify and hold the Agent, the Lenders and their
respective branches, Affiliates and/or correspondents harmless from and
against all liability, loss and expense (including reasonable attorney's fees
and costs) incurred by the Agent, the Lenders and/or their respective
branches, Affiliates and/or correspondents relative to and/or as a
consequence of (a) any failure by the Borrowers to perform the agreements
hereunder and under any Letter of Credit Agreement, (b) any Letter of Credit
Agreement, this Agreement, any Letter of Credit and any draft, draw and/or
acceptance under or purported to be under any Letter of Credit, (c) any
action taken or omitted by the Agent, any of the Lenders and/or any of their
respective branches, Affiliates and/or correspondents at the request of the
Borrowers, (d) any failure or inability to perform in accordance with the
terms of any Letter of Credit by reason of any control or restriction
rightfully or wrongfully exercised by any de facto or de jure Governmental
Authority, group or individual asserting or exercising governmental or
paramount powers, and/or (e) any consequences arising from causes beyond the
control of the Agent, any of the Lenders and/or any of their respective
branches, Affiliates and/or correspondents.

                      Except for willful misconduct, the Agent, the Lenders and
their respective branches, Affiliates and/or correspondents, shall not be
liable or responsible in any respect for any (a) error, omission,
interruption or delay in transmission, dispatch or delivery of any one or
more messages or advices in connection with any Letter of Credit, whether
transmitted by cable, telegraph, mail or otherwise and despite any cipher or
code which may be employed, and/or (b) action, inaction or omission which may
be taken or suffered by it or them in good faith or through inadvertence in
identifying or failing to identify any beneficiary or otherwise in connection
with any Letter of Credit.

                      Any Letter of Credit may be amended, modified or revoked
only upon the receipt by the Agent from the Borrowers and the beneficiary
(including any transferee and/or assignee of the original beneficiary), of a
written consent and request therefor.

                      If any Laws, order of court and/or ruling or regulation of
any Governmental Authority of the United States (or any state thereof) and/or
any country other than the United States permits a beneficiary under a Letter
of Credit to require the Agent, the Lenders and/or any of their respective
branches, Affiliates and/or correspondents to pay drafts under or purporting
to be under a Letter of Credit after the expiration date of the Letter of
Credit, the Borrowers shall reimburse the Agent and the Lenders, as
appropriate, for any such payment pursuant to provisions of Section 2.2.6
(Change in Law; Increased Cost).

                      Except as may otherwise be specifically provided in a
Letter of Credit or Letter of Credit Agreement, the laws of the State and the
Uniform Customs and Practice for Documentary Credits, 1993 Revision,
International Chamber of Commerce Publication No. 500 shall govern the
Letters of Credit.  The Laws, rules, provisions and regulations of the
Uniform Customs and Practice for Documentary Credits are hereby incorporated
by reference.  In the event of a conflict between the Uniform Customs and
Practice for Documentary Credits and the laws of the State, the Uniform
Customs and Practice for Documentary Credits shall prevail.

                      2.2.8   Participations in the Letters of Credit.
                        ----------------------------------------
                      Each Lender hereby irrevocably authorizes the Agent to
issue Letters of Credit in accordance with the provisions of this Agreement. 
As of the date each Letter of Credit is opened or issued by the Agent
pursuant to the provisions of this Agreement, each Lender shall have an
undivided participating interest in (a) the rights and obligations of the
Agent under such Letter of Credit, and (b) the Outstanding Letter of Credit
Obligations of the Borrowers with respect to such Letter of Credit, in an
amount equal to each Lender's Revolving Credit Pro Rata Share of such
Outstanding Letter of Credit Obligations.

                      2.2.9   Payments by the Lenders to the Agent.
                        -------------------------------------
                      If the Borrowers fail to pay to the Agent any Current
Letter of Credit Obligations as and when due and payable, the Agent shall
promptly notify each of the Lenders and shall demand payment from each of the
Lenders such Lender's Revolving Credit Pro Rata Share of such unpaid Current
Letter of Credit Obligations.  In addition, if any amount paid to the Agent
on account of Current Letter of Credit Obligations is rescinded or required
to be restored or turned over by the Agent upon the insolvency, bankruptcy,
dissolution, liquidation or reorganization of the Borrowers or upon or as a
result of the appointment of a receiver, intervenor, trustee, conservator or
similar officer for the Borrowers, or is otherwise not indefeasibly covered
by an advance under the Revolving Loan, the Agent shall promptly notify each
of the Lenders and shall demand payment from each of the Lenders of its
Revolving Credit Pro Rata Share of its portion of the Current Letter of
Credit Obligations to be remitted to the Borrowers.

                      Each of the Lenders irrevocably and unconditionally agrees
to honor any such demands for payment under this Section and promises to pay
to the Agent's account on the same Business Day as demanded the amount of its
Revolving Credit Pro Rata Share of the Current Letter of Credit Obligations
in immediately available funds, without any setoff, counterclaim or deduction
of any kind.  Any payment by a Lender hereunder shall in no way release,
discharge or lessen the obligation of the Borrowers to pay Current Letter of
Credit Obligations to the Agent in accordance with the provisions of this
Agreement.

                      The obligation of each of the Lenders to remit the amounts
of its Revolving Credit Pro Rata Share of Current Letter of Credit
Obligations for the account of the Agent pursuant to this Section shall be
unconditional and irrevocable under any and all circumstances and may not be
terminated, suspended or delayed for any reason whatsoever, provided that all
payments of such amounts by each of the Lenders shall be without prejudice to
the rights of each of the Lenders with respect to the Agent's alleged willful
misconduct.  Any claim any Lender may have against the Agent as a result of
the Agent's alleged willful misconduct may be brought by such Lender in a
separate action against the Agent but may not be used as a defense to payment
under the provisions of this Section.

                      No failure of any Lender to remit the amount of its
Revolving Credit Pro Rata Share of Current Letter of Credit Obligations to
the Agent pursuant to this Section shall affect the obligations of the Agent
under any Letter of Credit, and if any Lender does not remit to the Agent the
amount of its Revolving Credit Pro Rata Share of Current Letter of Credit
Obligations on the same day as demanded, then without limiting such Lender's
obligation to transmit funds on the same Business Day as demanded, such
Lender shall be obligated to pay, on demand of the Agent and without setoff,
counterclaim or deduction of any kind whatsoever interest on the unpaid
amount at the Federal Funds Rate for each day from the date such amount shall
be due and payable to the Agent until the date such amount shall have been
paid in full to the Agent by such Lender.

       Section 2.3    Swing Line Sub-Facility.
                  ------------------------
                      2.3.1   Swing Line Loans.
                        -----------------
                      Subject to the terms and conditions hereof, Citizens
agrees to make swing line loans (individually, a "Swing Line Loan" and
collectively, the "Swing Line Loans") to the Borrowers, jointly and severally,
in an aggregate principal amount not to exceed at any one time outstanding Ten
Million Dollars ($10,000,000) (the "Swing Line Committed Amount"); provided,
however, Borrowers shall not request, and Citizens shall not make, a Swing
Line Loan if, after giving effect to the making of such Swing Line Loan, the
aggregate outstanding principal balance of the Revolving Loan, the Swing Line
Loans and all Letter of Credit Obligations would exceed the lesser of the (a)
Total Revolving Credit Committed Amount or (b) Borrowing Base.  During the
Revolving Credit Commitment Period, each Borrower may use the Swing Line
Commitment by borrowing, repaying and reborrowing, all in accordance with the
terms and conditions hereof.

                      2.3.2   Refunding Swing Line Loans.
                        ---------------------------
                      Citizens may from time to time at its discretion, on
behalf of the Borrowers, issue a notice stating the current balance outstanding
under the Swing Line Commitment.  Each Lender shall make advances under the
Revolving Loan available to the Agent in immediately available funds, not
later than 2:00 p.m. (Eastern Time), one (1) Business Day after the date of
any notice from Citizens that a Revolving Loan is requested on behalf of the
Borrowers (the "Refunding Date").  At any time there are amounts outstanding
under the Swing Line Loan, Citizens will make such refunding requests to each
Lender no less frequent than two (2) times per week.  The proceeds of such
Revolving Loan shall be immediately applied by Citizens to reduce the
outstanding principal balance to an amount not to exceed One Million Dollars
($1,000,000) under the Swing Line Commitment (the "Refunded Swing Line
Loans").  Effective on the Business Day such advances under the Revolving
Loan are made, the portion of the Swing Line Loans so paid shall no longer be
outstanding as Swing Line Loans, shall no longer be due under the Swing Line
Note and shall be due under the respective Revolving Credit Notes issued to
the Lenders in accordance with their respective Pro Rata Shares of the
Revolving Credit Committed Amount.  Each Borrower authorizes Citizens to
charge such Borrower's accounts with the Agent (up to the amount available in
each such account) in order to immediately pay the amount of such Refunded
Swing Line Loans to the extent amounts received from the Lenders are not
sufficient to repay in full such Refunded Swing Line Loans.

                      2.3.3   No Swing Line Loans if Default.
                        -------------------------------
                      Notwithstanding anything herein to the contrary, Citizens
shall not be obligated to make any Swing Line Loans if a Default or an Event
of Default shall have occurred and be continuing.

                      2.3.4   Participations in Swing Line Loans.
                        -----------------------------------
                      If prior to the time a Revolving Loan would have otherwise
been made, a Default or Event of Default shall have occurred, each Lender
shall immediately purchase an undivided participating interest in an amount
equal to (a) its Pro Rata Share of the Revolving Credit Committed Amount as
set forth in Section 2.1.1 (Revolving Credit Facility) times (b) the
aggregate principal amount of Swing Line Loans then outstanding which were to
have been repaid with such Refunded Swing Line Loans (the "Swing Line
Participation Amount").  On the Refunding Date, each Lender shall transfer to
Citizens, in immediately available funds, such Lender's Swing Line
Participation Amount and upon receipt thereof Citizens shall deliver to each
Lender a Swing Line Loan Participation Certificate dated the date of
Citizens' receipt of such funds and in the Swing Line Participation Amount.

                      2.3.5   Adjustments to Swing Line Participation Amounts.
                        ------------------------------------------------
                      Whenever, at any time after Citizens has received from any
Lender such Lender's Swing Line Participation Amount, Citizens receives any
payment on account of the Swing Line Loans, Citizens will distribute to such
Lender its pro rata share of such payment (appropriately adjusted, in the
case of interest payments, to reflect the period of time during which such
Lender's participating interest was outstanding and funded); provided,
however, that in the event that such payment received by Citizens is required
to be returned, such Lender will return to Citizens any portion thereof
previously distributed to it by Citizens.

                      2.3.6   Lenders' Obligations Unconditional.
                        -----------------------------------
                      Each Lender's obligation to make the Refunded Swing Line
Loans referred to in this Section 2.3 (Swing Line Sub-Facility) and to
purchase participating interests in Swing Line Loans pursuant to this Section
shall be absolute and unconditional and shall not be affected by any
circumstance, including, without limitation, (a) any set-off, counterclaim,
recoupment, defense or other right which any Lender or either Borrower may
have against Citizens, either Borrower or any other Person for any reason
whatsoever; (b) the occurrence or continuance of a Default or an Event of
Default; (c) any adverse change in the condition (financial or otherwise) of
either Borrower; (d) any breach of this Agreement or any other Financing
Document by the Borrowers, the Agent or any of the Lenders, or (e) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing.

                      2.3.7   Swing Line Note.
                        ----------------
                      Advances made by Citizens under the Swing Line Commitment
shall be evidenced by a separate Swing Line Note payable to the order of
Citizens in the principal amount of the Swing Line Commitment substantially
in the form of Exhibit B-3 attached hereto and made a part hereof, with the
blanks therein appropriately completed, dated as of the date of the initial
advance under this Agreement and payable on the Revolving Credit Expiration
Date (the "Swing Line Note").  The Borrowers' joint and several obligations
under the Swing Line Note and other indebtedness, obligations and liabilities
with respect to the Swing Line Loan are part of the Obligations and are
secured by the Obligations.

                      2.3.8   Interest on Swing Line Loans.
                        -----------------------------
                             (a)    Each Swing Line Loan shall bear interest
until the Revolving Credit Expiration Date at the Base Rate.  Interest on each
Swing Line Loan shall be payable in consecutive monthly payments commencing
on the last Business Day of the first calendar month following an advance
under the Swing Line Sub-Facility and continuing on the last Business Day of
each month thereafter through and including Revolving Credit Termination
Date.

                             (b)    Notwithstanding the foregoing, following
the occurrence and during the continuance of a Default or an Event of Default,
at the option of the Agent, all Swing Line Loans and all other Obligations shall
bear interest at the Post-Default Rate.

                      2.3.9   Mandatory Prepayments of Swing Line Loan.
                        -----------------------------------------                              
                      The Borrowers shall make the mandatory prepayments (each a
"Swing Line Loan Mandatory Prepayment" and collectively, the "Swing Line Loan
Mandatory Prepayments") of the Swing Line Loan at any time and from time to
time in such amounts requested by Citizens or the Agent pursuant to Section
2.1.3 (Borrowing Base) of this Agreement in order to cover any Borrowing Base
Deficiency.

                      2.3.10  Optional Prepayments of Swing Line Loan.
                                ----------------------------------------
                      The Borrowers may, at their option, at any time and from
time to time, prepay (each a "Swing Line Loan Optional Prepayment" and
collectively the "Swing Line Loan Optional Prepayments") the Swing Line Loan
without premium or penalty.

       Section 2.4    Interest Rates on Revolving Loans and Swing Line Loans.
                      -------------------------------------------------------

                      2.4.1   General Provisions.
                                -------------------
                      All payments hereunder (including any payment or
prepayment of principal, interest, fees and other charges) or with respect to
the Notes or the Loans shall be made in lawful money of the United States of
America, in immediately available funds without set-off, deduction or
counterclaim of any kind, to the Agent, for the ratable benefit of the Lenders,
at its office at 8521 Leesburg Pike, Suite 405, Vienna Virginia  22182, or at
such other place as the Agent may in writing designate, and shall be applied, at
the option of each Lender with respect to the Obligations due to such Lender,
first to accrued Obligations other than principal and interest, second to
accrued interest outstanding under the Swing Line Loan, third to principal
due on the Swing Line Loan, fourth to accrued interest on Loans bearing
interest at the Base Rate, fifth to accrued interest on Loans bearing
interest at the LIBOR-based Rate, sixth to principal due on Loans bearing
interest at the Base Rate, and seventh to principal due on Loans bearing
interest at a LIBOR-based Rate on the last day of the Interest Period
applicable thereto.

                      2.4.2   Applicable Interest Rates.
                        --------------------------
                             (a)    The Revolving Loan, or any portion
thereof shall bear interest until the Revolving Credit Termination Date at
either the Base Rate or the LIBOR-based Rate, as selected and specified by VSE
in a Rate Request Notice furnished to the Agent in accordance with the
provisions of Section 2.4.3(e), or as otherwise determined in accordance with
the provisions of this Section 2.4.

                             (b)    The Swing Line Loan, or any portion
thereof shall bear interest until the Revolving Credit Termination Date at the
Base Rate or as otherwise determined in accordance with the provisions of this
Section 2.4.

                             (c)    Notwithstanding the foregoing, following
the occurrence and during the continuance of an Event of Default, at the option
of the Requisite Lenders, the Revolving Loan, the Swing Line Loan and all
other Obligations shall bear interest at the Post-Default Rate.

                      2.4.3   Selection of Interest Rates on the Revolving
                        --------------------------------------------
                        Loan.
                        -----
                             (a)    The Borrowers may select the initial
Applicable Interest Rate or Applicable Interest Rates to be charged on advances
under the Revolving Loan.

                             (b)    From time to time after the date of this
Agreement as provided in this Section, by a proper and timely Rate Request
Notice furnished to the Agent in accordance with the provisions of Section
2.4.3(e), the Borrowers may select an initial Applicable Interest Rate for
any advance under the Revolving Loan or may convert the Applicable Interest
Rate for any existing advance under the Revolving Loan to any other
Applicable Interest Rate.

                             (c)    The Borrowers' selection of an
Applicable Interest Rate, the Borrowers' election to convert an Applicable
Interest Rate to another Applicable Interest Rate, and any other adjustments in
an interest rate are subject to the following limitations:

                                  (i)     no change from the LIBOR Rate to
            the Base Rate shall become effective on a day other than a
            Business Day and no change from the Base Rate to the LIBOR
            Rate shall become effective on a day other than a day which
            is a Eurodollar Business Day;

                                (ii)      any Applicable Interest Rate
            change      for any advance under the Revolving Loan to be effective
            on a date on which any principal payment on account of such
            advance is scheduled to be paid shall be made only after such
            payment shall have been made; and

                                  (iii)   as of the effective date of a
            selection, there shall not exist an Event of Default.

                             (d)    If a request for an advance under the
Revolving Loan is not accompanied by a Rate Request Notice or does not otherwise
include a selection of an Applicable Interest Rate, or if, after having made
a selection of an Applicable Interest Rate, the Borrowers fail or are not
otherwise entitled under the provisions of this Agreement to continue such
Applicable Interest Rate, the Borrowers shall be deemed to have selected the
Base Rate as the Applicable Interest Rate until such time as the Borrowers
have selected a different Applicable Interest Rate in accordance with, and
subject to, the provisions of this Section.

                             (e)    The Lenders will not be obligated to
make advances under the Revolving Loan or the Swing Line Loan or to convert the
Applicable Interest Rate on advances under the Revolving Loan to another
Applicable Interest Rate, unless the Agent shall have received an irrevocable
written or telephonic notice (a "Rate Request Notice") from the Borrowers
specifying the following information:

                                  (i)     the amount to be borrowed or
            converted;
     
                                (ii)      a selection of the Applicable
            Interest Rate; and

                                  (iii)   the requested date on which such
            election is to be effective.

                      Any telephonic notice must be confirmed in writing within
three (3) Business Days.  Each Rate Request Notice must be received by the
Agent not later than 11:00 a.m. (Eastern Time) on the Business Day of any
requested borrowing or conversion in the case of a selection of the Base