EXHIBIT 10.5
Second Amendment to Security and Loan Agreement
(Accounts Receivable)
This Second Amendment ("Amendment") amends that certain Security and Loan
Agreement (Accounts Receivable) ("Security and Loan Agreement") with the
attached Addendum ("Addendum") both dated February 9 , 1998, as amended (such
Security and Loan Agreement and Addendum herein referred to as "Agreement") by
and between Imperial Bank ("Bank"), The ▇▇▇▇▇ Companies, Inc., ▇▇▇▇▇
Engineering, Inc., and ESI, Engineering Services, Inc. ("Co-Borrowers") as
follows:
1. Paragraph 8.b of the Addendum is hereby amended in full to read as
follows:
"b. Have and maintain a ratio of total liabilities to Tangible Net Worth of
not greater than 6.25 to 1.0 from 12/31/97 through 3/30/98; decreasing to 5.50
to 1.0 from 3/31/98 through 6/29/98, decreasing to 4.75 to 1.0 from 6/30/98
through 9/29/98; decreasing to 4.00 to 1.0 from 9/30/98 through 12/30/98;
decreasing to 3.25 to 1.0 from 12/31/98 and thereafter."
2. Paragraph 8.c of the Addendum is hereby amended in full to read as follows:
"c. Have and maintain a Current Ratio of not less than .90:1 to 1.0 from
12/31/97 through 3/30/98; increasing to 1.10 to 1.0 from 3/31/98 through 6/29/98
; decreasing to .90 to 1.0 from 6/30/98 through 9/29/98; increasing to .95 to
1.0 from 9/30/98 through 12/30/98; increasing to 1.00 to 1.0 from 12/31/98 and
thereafter. Current Ratio shall mean Current Assets divided by Current
Liabilities."
3 Except as provided above, the Agreement remains unchanged.
4 This Amendment is effective as of June 22, 1998, and the parties hereby
confirm that the Agreement as amended is in full force and effect.
THE ▇▇▇▇▇ COMPANIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
SIGNATURES CONTINUED ON NEXT PAGE
▇▇▇▇▇ ENGINEERING, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
ESI, ENGINEERING SERVICES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
IMPERIAL BANK
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: VP
