ex10_1.htm


    
      
        

      

    

     

    Exhibit
      10.1

     

    FIRST
      AMENDMENT TO LOAN AND
      SECURITY AGREEMENT

     

    THIS
      FIRST AMENDMENT TO LOAN AND
      SECURITY AGREEMENT (this "First
      Amendment")
      is made as of the 18th day
      of October, 2007, by
      and between FORTUNE INDUSTRIES,
      INC. ("Borrower");
      FIFTH THIRD BANK
      (FORMERLY KNOWN AS FIFTH THIRD BANK (CENTRAL INDIANA))
("Bank");
      and FIRST INDIANA BANK,
      N.A., as a Participant under that certain Participation Agreement made as
      of August 31, 2006, (including its successors and assigns, "First
      Indiana");

     

    WITNESSETH:

     

    WHEREAS,
as
      of August 31, 2006,
      the parties hereto entered into a certain Loan and Security Agreement (the
      "Agreement");

     

    WHEREAS,
the
      parties desire to
      amend the Agreement to, among other things, add certain personal guarantors;
      add
      certain new covenants, terms and conditions; and modify certain covenants,
      terms
      and conditions, all subject to the terms contained herein;

     

    WHEREAS,
as
      of the quarters
      ending February 28, 2007 and May 31, 2007, Borrower was not in compliance
      with:

     

    
      	
               

            	
              (a)

            	
              Section
                3.7 (Event of Default) of the
                Agreement,

            


    

    
      	
               

            	
              (b)

            	
              Section
                3.8 (Adverse Changes) of the
                Agreement,

            


    

    
      	
               

            	
              (c)

            	
              Section
                7.7 (Financial Statements) of the
                Agreement,

            


    

    
      	
               

            	
              (d)

            	
              Section
                7.9 (Event of Default) of the
                Agreement,

            


    

    
      	
               

            	
              (e)

            	
              Section
                7.11 (Adverse Circumstances) of the
                Agreement,

            


    

    
      	
               

            	
              (f)

            	
              Section
                7.18 (Complete Information) of the
                Agreement,

            


    

    
      	
               

            	
              (g)

            	
              Section
                8.3 (Investments) of the Agreement,

            


    

    
      	
               

            	
              (h)

            	
              Section
                8.5 (Issuance of Stock) of the
                Agreement,

            


    

    
      	
               

            	
              (i)

            	
              Section
                8.9 (Acquisitions) of the
                Agreement,

            


    

    
      	
               

            	
              (j)

            	
              Section
                9.7 (Financial Statements) of the
                Agreement,

            


    

    
      	
               

            	
              (k)

            	
              Section
                9.12 (Brokerage Account) of the
                Agreement,

            


    

    
      	
               

            	
              (l)

            	
              Section
                9.16 (Notice of Default) of the
                Agreement,

            


    

    
      	
               

            	
              (m)

            	
              Section
                10.1 (Senior Funded Debt to EBITDA Ratio) of the
                Agreement,

            


    

    
      	
               

            	
              (n)

            	
              Section
                10.2 (Tangible Net Worth) of the Agreement, and Section
                10.4

            


    

    
      	
               

            	
              (o)

            	
              (Fixed
                Charge Coverage Ratio) of the
                Agreement.

            


    

     

    Such
      noncompliance by the Borrower constitute Events of Default under the Agreement.
      The foregoing Events of Default, as of the quarters ending February 28, 2007
      and
      May 31, 2007, under Sections 3.7, 3.8, 7.7, 7.9, 7.11, 7.18, 8.3, 8.5, 8.9,
      9.7,
      9.12, 9.16, 10.1, 10.2 and 10.4 of the Agreement are collectively referred
      to
      herein as the "Existing Defaults"; and

     

    Now,
THEREFORE,
in
      consideration of
      the premises, and the mutual promises herein contained, the parties agree that
      the Agreement shall be, and it hereby is, amended as provided herein and the
      parties further agree as follows:


    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    PART
      I. AMENDATORY
      PROVISIONS

     

    ARTICLE
      1 DEFINITIONS.

     

    Section
      1.1 Defined Terms. Section 1.1 of the Agreement is hereby amended by
      deleting the definition for "Tangible Net Worth"; substituting the following
      definitions of "Amortization", "Borrowing Base Certificate", "Fixed Asset
      Value", "Interest Rate Agreements", "Loan Rate", "Obligations", "Revolving
      Loan
      Guarantor", "Revolving Note" and "Term Loan Guarantor" in lieu of the like
      existing definitions; and adding definitions for "Funded Debt", "Guarantees",
      "Landlord Consent and Waiver", "Net Worth", "Revolving Loan Guaranty", "Term
      Loan Guaranty", "Total Capitalization", "Trust Funds", and "Trust" as
      follows:


     

    "Amortization"
      shall mean the total amount added to amortization expense, as reflected on
      the
      Borrower's Financial Statements and determined in accordance with
      GAAP.

     

    "Borrowing
      Base Certificate" shall mean a certificate duly executed by an officer or
      duly authorized representative of the Borrower completed and in substantially
      the form of Exhibit A hereto.

     

    "Fixed
      Asset Value" shall mean the sum of (i) Three Million Five Hundred Thousand
      Dollars and No Cents ($3,500,000.00) minus (ii) the product of (A) Five Hundred
      Thousand Dollars and No Cents ($500,000.00) times (B) the number equal to the
      number of complete calendar years that have passed since the date hereof;
      provided, however, that the Fixed Asset Value shall not be less than
      zero.

     

    "Funded
      Debt' of a Person means such Person's (a) obligations for borrowed money;
      (b) obligations representing the deferred purchase price of property or services
      (other than accounts payable arising in the ordinary course of such Person's
      business payable on terms customary in the trade), including, without
      limitation, payment obligations under non-compete agreements; (c) obligations,
      whether or not assumed, secured by any mortgage, deed of trust, pledge, lien,
      security interest or other charge or encumbrance upon or in property owned
      by
      the subject Person or payable out of the proceeds or production from property
      now or hereafter owned or acquired by such Person; (d) obligations which are
      evidenced by notes, acceptances, or other instruments; (e) Capital Lease
      obligations; (f) indebtedness or other obligations of any other Person for
      borrowed money or for the deferred purchase price of property or services,
      the
      payment or collection of which the subject Person has guaranteed (except by
      reason of endorsement for collection in the ordinary course of business) or
      in
      respect of which the subject Person is liable, contingently or otherwise,
      including, without limitation, liability by way of agreement to purchase, to
      provide funds for payment, to supply funds to or otherwise to invest in such
      other Person, or otherwise to assure a creditor against loss; and (g)
      reimbursement or other obligations in connection with letters of
      credit.

     

    "Interest
      Rate Agreements" means any transaction (including an agreement with respect
      thereto) now existing or hereafter entered into between Borrower and the Bank
      or
      Affiliate thereof (or any other financial institution upon terms acceptable
      to
      Bank and accompanied by an appropriate intercreditor agreement as may be
      required, in form and substance satisfactory to Bank, acting reasonably), which
      is a rate swap, basis swap, forward rate transaction, commodity swap, commodity
      option, equity or equity index swap, equity or equity index option, bond option,
      interest rate option, foreign exchange transaction, cap transaction, floor
      transaction, collar transaction, forward transaction, currency swap transaction,
      cross-currency rate swap transaction, currency option or any other similar
      transaction (including any option with respect to any of these transactions)
      or
      any combination thereof, whether linked to one or more interest rates, foreign
      currencies, commodity prices, equity prices or other financial
      measures.


    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    "Guarantees"
      shall mean collectively, the Revolving Loan Guaranty and the Term Loan
      Guaranty.

     

    "Landlord
      Consent and Waiver" shall have the meaning set forth in Section
      3.1.

     

    "Loan
      Rate" shall mean (a) the LIBOR Rate plus two percent (2.00%) or (b) if
      Borrower maintains a Fixed Charge Coverage Ratio of at least 1.15 to 1.00 for
      four (4) consecutive fiscal quarters, tested at the end of each fiscal quarter,
      then the LIBOR Rate plus one and three-quarters percent (1.75%);
provided,however, that upon the Borrower attaining a Fixed Charge
      Coverage Ratio at the end of any fiscal quarter of less than 1.15 to 1.00,
      then
      the Loan Rate automatically reverts back to the LIBOR Rate plus two percent
      (2.00%).

     

    "Net
      Worth" shall mean, at a particular date, all amounts which would be included
      under equity for any Person determined in accordance with GAAP.

     

    "Obligations"
      shall mean the Loans, as evidenced by the Notes, all interest accrued thereon,
      any fees due the Bank hereunder, any expenses incurred by the Bank hereunder
      and
      any and all other liabilities and obligations of the Borrower and its
      Subsidiaries (and of any partnership in which the Borrower or any of its
      Subsidiaries is or may be a partner) to the Bank, howsoever created, arising
      or
      evidenced, and howsoever owned, held or acquired, whether now or hereafter
      existing, whether now due or to become due, direct or indirect, absolute or
      contingent, and whether several, joint or joint and several, including, but
      not
      limited to, (i) any Interest Rate Agreements; (ii) any other documents,
      agreements, instruments, letters of credit, and/or credit agreements under
      which
      the Borrower and/or any Subsidiary are or will be in the future obligated or
      liable to the Bank; and (iii) any other present or future documents, agreements,
      instruments, letters of credit, and/or credit agreements evidencing any of
      the
      Obligations.

     

    "Revolving
      Loan Guarantor" shall mean collectively or individually, as applicable, each
      Subsidiary, Carter M. Fortune, John F. Fisbeck and the Trust.

     

    "Revolving
      Loan Guaranty" shall mean collectively or individually, as applicable, the
      guaranty of each Subsidiary, Carter M. Fortune, John F. Fisbeck and the Trust
      with respect to the Revolving Loan.

     

    "Revolving
      Note" shall have the meaning set forth in Section 4.1 hereof.

     

    "Tangible
      Net Worth" the definition of Tangible Net Worth is amended by deleting the
      definition in its entirety.

     

    "Term
      Loan Guarantor" shall mean collectively or individually, as applicable,
      Carter M. Fortune, John F. Fisbeck and the Trust.


    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    "Term
      Loan Guaranty" shall mean collectively or individually, as applicable, the
      guaranty of Carter M. Fortune, John F. Fisbeck and the Trust with respect to
      the
      Term Loan.

     

    "Total
      Capitalization" shall mean at any time the sum of Funded Debt and Net Worth,
      each calculated at such time.

     

    "Trust"
      shall mean The Carter M. Fortune Living Trust dated May 4, 2006; Carter M.
      Fortune Living Trust dated May 4, 2006; or Carter M. Fortune, Trustee of the
      Carter M. Fortune Living Trust dated May 4, 2006, and any amendments
      thereto.

     

    "Trust
      Funds" shall mean all monies specifically owned, designated or earmarked by
      any customer of the Borrower and/or any customer of a Subsidiary, pursuant
      to a
      contract, as employee wages, employee benefits (including, but not limited
      to,
      health insurance, workers compensation insurance and retirement funds) and/or
      payroll taxes to be held by the Borrower or a Subsidiary in the Deposit Accounts
      listed in Section 6.1 herein prior to being disbursed to the respective
      employees, governmental agency and/or third party.

     

    Section
      1.4    Other Definitional
      Provisions; Construction. The Agreement is hereby amended by substituting
      the following new Section 1.4 in lieu of the existing Section 1.4:

     

    Section
      1.4 Other Definitional Provisions: Construction. Whenever the context so
      requires, the neuter gender includes the masculine and feminine, the single
      number includes the plural, and vice versa, and in particular the word
      "Borrower" shall be so construed. 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
      references to Article, Section, Subsection, Schedule, Exhibit and like
      references are references to this Agreement unless otherwise specified. An
      Event
      of Default shall "continue" or be "continuing" until such Event of Default
      has
      been waived in accordance with Section 13.3 hereof. References in this Agreement
      to any party shall include such party's successors and permitted assigns.
      References to any "Section" shall be a reference to such Section of this
      Agreement unless otherwise stated. To the extent any of the provisions of the
      other Loan Documents are inconsistent with the terms of this Agreement, the
      provisions of this Agreement shall govern.

     

    Article
      2 COMMITMENT
      OF THE BANK.

     

    Section
      2.1 Revolving Loans. The Agreement is hereby amended by substituting the
      following new Sections 2.1(a), 2.1(c)(i) and 2.1(c)(ii) in lieu of the existing
      Sections 2.1(a), 2.1(c)(i) and 2.1(c)(ii):

     

    (a)    Revolving
      Loan Commitment. Subject to the terms and conditions of this Agreement and
      the other Loan Documents, and in reliance upon the representations and
      warranties of the Borrower set forth herein and in the other Loan Documents,
      the
      Bank agrees to make such Revolving Loans at such times as the Borrower may
      from
      time to time request until, but not including, the Revolving Loan Maturity
      Date,
      and in such amounts as the Borrower may from time to time request, provided,
      however, that the aggregate principal balance of all Revolving Loans outstanding
      at any time shall not exceed the Revolving Loan Availability. Revolving Loans
      made by the Bank may be repaid and, subject to the terms and conditions hereof,
      borrowed again up to, but not including, the Revolving Loan Maturity Date unless
      the Revolving Loans are otherwise terminated or extended as provided in this
      Agreement. The Revolving Loans shall be used for general working capital
      purposes of the Borrower.


    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (c)           Revolving
      Loan Principal Repayments.

     

    (i)          Mandatory
      Principal Repayments. All Revolving Loans hereunder shall be repaid by the
      Borrower on the Revolving Loan Maturity Date, unless payable sooner pursuant
      to
      the provisions of this Agreement. In the event the aggregate outstanding
      principal balance of all Revolving Loans hereunder exceed the Revolving Loan
      Availability, the Borrower shall, without notice or demand of any kind,
      immediately make such repayments of the Revolving Loans or take such other
      actions as shall be necessary to eliminate such excess.

     

    (ii)          Optional
      Prepayments. The Borrower may from time to time prepay the Revolving Loans,
      in whole or in part, without any prepayment penalty other than those set forth
      herein. If, for any reason, a Revolving Loan is paid prior to the last Business
      Day of any Interest Period, whether voluntary, involuntary, by reason of
      acceleration or otherwise, each such prepayment of a Revolving Loan will be
      accompanied by the amount of accrued interest on the amount prepaid and any
      and
      all reasonable costs, expenses, penalties and charges incurred by the Bank
      as a
      result of the early termination or breakage of a Revolving Loan on a date other
      than the last Business Day of the applicable Interest Period, plus the amount,
      if any, by which (i) the additional interest which would have been payable
      during the Interest Period on the Revolving Loan had it not been prepaid,
      exceeds (ii) the interest which would have been recoverable by the Bank by
      placing the amount prepaid on deposit in the domestic certificate of deposit
      market, the eurodollar deposit market, or other appropriate money market
      selected by the Bank, for a period starting on the date on which it was prepaid
      and ending on the last day of the Interest Period for such Revolving Loan.
      The
      amount of any such loss or expense payable by the Borrower to the Bank under
      this section shall be determined in the Bank's reasonable discretion based
      upon
      the assumption that the Bank funded its loan commitment for Revolving Loans
      in
      the London Interbank Eurodollar market and using any reasonable attribution
      or
      averaging methods which the Bank deems appropriate and practical, provided,
      however, that the Bank is not obligated to accept a deposit in the London
      Interbank Eurodollar market in order to charge interest on a Revolving Loan
      at
      the Loan Rate.

     

    Section
      2.2 Term Loan. The Agreement is hereby amended by substituting the
      following new Section 2.2(b) in lieu of the existing Section
      2.2(b):

     

    (b)
Term
      Loan Interest and
      Payments. Except as
      otherwise provided in this Section 2.2(b), the principal amount of the Term
      Loan
      outstanding from time to time shall bear interest at the Loan Rate. Principal
      and accrued and unpaid interest on the unpaid principal balance of the Term
      Loan
      outstanding from time to time, shall be due and payable monthly, in arrears,
      commencing on October 5, 2006 and continuing on the fifth (5th)
      day of each
      calendar month thereafter, in equal monthly principal installments of One
      Hundred Sixty-Six Thousand Six Hundred Sixty-Seven Dollars and No Cents
      ($166,667.00), together with an additional amount representing accrued interest
      as set forth above, beginning on October 5, 2006, and continuing on the fifth
      (5th) day of
      each month thereafter, with a final payment of all outstanding principal and
      accrued interest due on the Term Loan Maturity Date. Principal amounts repaid
      on
      the Term Loan Note may not be borrowed again. Any amount of principal or
      interest on the Term Loan which is not paid when due, whether at stated
      maturity, by acceleration or otherwise, shall bear interest payable on demand
      at
      the Default Rate.


    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    Article
      3 CONDITIONS OF
      BORROWING.

     

    Section
      3.1 Loan Documents. The Agreement is hereby amended by substituting the
      following new Section 3.1 in lieu of the existing Section 3.1:

     

    Section
      3.1 Loan Documents. The Borrower shall have failed to execute and deliver
      to the Bank any of the following loan documents all of which must be
      satisfactory to the Bank and the Bank's counsel in form, substance and execution
      (the loan documents listed below in subparagraphs (a) through (h) together
      with
      (i) any other documents, agreements, instruments, letters of credit, and/or
      credit agreements under which the Borrower and/or any Subsidiary are or will
      be
      in the future obligated or liable to the Bank; (ii) any other documents executed
      in connection with the Loans, including without limitation, any guaranties
      or
      security agreements executed by the Guarantors or Borrower's Subsidiaries;
      and
      (iii) any other present or future documents, agreements, instruments, letters
      of
      credit, and/or credit agreements evidencing any of the Obligations,
      collectively, the "Loan Documents"):

     

    (a)          Loan
      Agreement. Two copies of this Agreement duly executed by the
      Borrower.

     

    (b)          Revolving
      Note. The Revolving Note duly executed by the Borrower.

     

    (c)          Term
      Loan Note. The Term Loan Note duly executed by the Borrower.

     

    (d)          Landlord
      Consent and Waiver. A Landlord Consent and Waiver duly executed by any
      landlord with respect to any leased real estate of Borrower or its Subsidiaries,
      in form and substance acceptable to Bank.

     

    (e)          Term
      Loan Guaranty. The Limited Guaranty duly executed by each Term Loan
      Guarantor.

     

    (f)          Stock
      Pledge Agreements. The Stock Pledge Agreements duly executed by the
      Borrower, Nor-Cote International, Inc., CSM, Inc., James H. Drew Corporation,
      Century II Staffing, Inc., Fortune Wireless, Inc., and Professional Staff
      Management, Inc.

     

    (g)          Resolutions.
      Resolutions of the boards of directors and/or shareholders of the Borrower
      authorizing the execution of this Agreement and the Loan
      Documents.


    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    (h)           Additional
      Documents. Such other certificates, guaranties, financial statements,
      schedules, resolutions, opinions of counsel, notes and other documents which
      are
      provided for hereunder or which the Bank shall require as well as (i) any other
      documents, agreements, instruments, letters of credit, and/or credit agreements
      under which the Borrower and/or any Subsidiary are or will be in the future
      obligated or liable to the Bank and (ii) any other present or future documents,
      agreements, instruments, letters of credit, and/or credit agreements evidencing
      any of the Obligations.

     

    Section
      3.12 Conditions to Subsequent Revolving Loans. The Agreement is hereby
      amended by adding the following new Section 3.12:

     

    Section
      3.12 Conditions to Subsequent Revolving Loans. Prior to the making of any
      Revolving Loan by the Bank:

     

    (a)          No
      Default. No Event of Default shall have occurred and be
      continuing.

     

    (b)          Representations
      and Warranties. Each representation and warranty contained in this
      Agreement shall be true and correct as of the date of each Revolving Loan,
      except to the extent any such representation or warranty relates solely to
      an
      earlier date and except changes reflecting transactions permitted by this
      Agreement.

     

    (c)          Legal
      Matters. All legal matters incident to the making of each Revolving
      Loan shall be reasonably satisfactory to Bank and its counsel.

     

    (d)          Expenses.
      Borrower shall have reimbursed Bank for all reasonable legal fees
      and
      other reasonable expenses incurred by Bank in connection with the Loans in
      accordance with this Agreement.

     

    ARTICLE
      5
MANNER OF BORROWING.

     

    Article
      5    Manner of
      Borrowing. The Agreement is hereby amended by substituting the following new
      Article 5 in lieu of the existing Article 5:

     

    Each
      Revolving Loan shall be made available to the Borrower upon its request, by
      Carter M. Fortune, John F. Fisbeck, or any other individual authorized in
      writing by either of them unless such Person's authority to so act has been
      revoked by the Borrower in writing previously received by the Bank. A request
      for a Revolving Loan must be received by no later than 11:00 a.m. Indianapolis,
      Indiana time, on the day it is to be funded. The proceeds of each Revolving
      Loan
      shall be made available at the office of the Bank by credit to the account
      of
      the Borrower or by other means requested by the Borrower and acceptable to
      the
      Bank.

     

    The
      Bank
      is authorized to rely on any written, verbal, electronic, telephonic or telecopy
      loan requests which the Bank believes in its good faith judgment to emanate
      from
      a properly authorized representative of the Borrower, whether or not that is
      in
      fact the case. The Borrower does hereby irrevocably confirm, ratify and approve
      all such advances by the Bank and does hereby indemnify the Bank against losses
      and expenses (including court costs, attorneys' and paralegals' fees) and shall
      hold the Bank harmless with respect thereto.


    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      6
SECURITY FOR THE OBLIGATIONS.

     

    Section
      6.1       Security for Obligations. The
      Agreement is hereby amended by substituting the following new Section 6.1(b)(vi)
      in lieu of the existing Section 6.1(b)(vi):

     

    (vi)
      All
      Chattel Paper, Electronic Chattel Paper, Instruments, Documents, Letter of
      Credit Rights, all proceeds of letters of credit, Health Care Insurance
      Receivables, Supporting Obligations, notes secured by real estate, Commercial
      Tort Claims and General Intangibles, including Payment Intangibles;

     

    The
      Agreement is hereby amended by adding the following language to the end of
      Section 6.1:

     

    Notwithstanding
      anything herein to the contrary, Collateral shall not include any Trust Funds
      held in the following Deposit Accounts with respect to the following
      Subsidiaries:

     

    
      	
              Subsidiary
                Name

            	
              Bank
                Account Name

            	
              Account
                Number(s)

            
	
              Century
                II ASO, Inc.

            	
              Century
                II ASO, Inc.

            	
              Fifth
                Third Bank:

            
	 	 	
              #                       
                

            
	
              Century
                II ASO, Inc.

            	
              Century
                II ASO, Inc.

            	
              Bank
                of America:

            
	 	 	
              #                       
                

            
	
              Century
                II Services, Inc.

            	
              Century
                II Services, Inc.

            	
              Fifth
                Third Bank:

            
	 	 	
              #                       
                

            
	 	 	
              #                       
                

            
	 	 	
              #                       
                

            
	
              Century
                II Services, Inc.

            	
              Century
                II Services, Inc.

            	
              Bank
                of America:

            
	 	 	
              #                       
                

            
	
              Century
                II Staffing TN,

            	
              Century
                II Staffing TN,

            	
              Fifth
                Third Bank:

            
	
              Inc.

            	
              Inc.

            	
              #                       
                

            
	
              Century
                II Staffing TN,

            	
              Century
                II Staffing TN,

            	
              Bank
                of America:

            
	
              Inc.

            	
              Inc.

            	
              #                       
                

            
	
              Century
                II Staffing USA,

            	
              Century
                II Staffing USA,

            	
              Fifth
                Third Bank:

            
	
              Inc.

            	
              Inc.

            	
              #                       
                

            
	
              Century
                II Staffing USA,

            	
              Century
                II Staffing USA,

            	
              Bank
                of America:

            
	
              Inc.

            	
              Inc.

            	
              #                       
                

            
	
              Employer
                Solutions

            	
              ESG
                of SLC - Operating

            	
              Key
                Bank:

            
	
              Group
                of SLC, Inc.

            	
              Account

            	
              #                       
                

            
	
              Employer
                Solutions

            	
              ESG
                of SLC - Payroll

            	
              Key
                Bank:

            
	
              Group
                of SLC, Inc.

            	 	
              #                       
                

            


    


    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    


    
      	
              ESG
                Achievement, Inc.

            	
              ESG
                Achievement, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Administration, Inc.

            	
              ESG
                Administration, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Assistance, Inc.

            	
              ESG
                Assistance, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Consulting, Inc.

            	
              ESG
                Consulting, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Direction, Inc.

            	
              ESG
                Direction, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Entities, Inc.

            	
              ESG
                Entities, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Fulfillment, Inc.

            	
              ESG
                Fulfillment, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Management, Inc.

            	
              ESG
                Management, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Offerings, Inc.

            	
              ESG
                Offerings, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Services, Inc.

            	
              ESG
                Services, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Success, Inc.

            	
              ESG
                Success, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Supervision, Inc.

            	
              ESG
                Supervision, Inc.

            	
              Key
                Bank:

              #                       
                

            
	
              ESG
                Insurance, Inc. d/b/a

              Aspen
                Cove Insurance,

              Inc.

            	
              Aspen
                Cove/Neal Dastrup

              Insurance
                - Operating

            	
              Key
                Bank:

              #                       
                

            
	
              Sageland
                Flagging, Inc.

              d/b/a
                Employer Solutions

              Staffing
                Group, Inc.

            	
              Employer
                Solutions

              Staffing
                Group - General

              Account

            	
              Key
                Bank:

              #                       
                

            
	
              Employer
                Solutions

              Group
                of Idaho, Inc.

            	
              Employer
                Solution Group

            	
              Key
                Bank:

              #                       
                

            
	
              Fortune
                Staffing, Inc.

            	
              Fortune
                Staffing, Inc.

            	
              Fifth
                Third Bank:

              #                       
                

            
	
              Fortune
                Staffing, Inc.

            	
              Fortune
                Staffing, Inc.

            	
              Bank
                of America, NA:

              #                       
                

            
	
              Precision
                Employee

              Management,
                L.L.C.

              d/b/a
                Checkmate

              Professional
                Employer

            	
              Precision
                Employee

              Management
                d/b/a

              Checkmate

            	
              Chase
                #                       
                

            


    


    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    


    
      	
              Precision
                Employee

              Management,
                L.L.C.

              d/b/a
                Checmate

              Professional
                Employer

            	
              Precision
                Employee

              Mgmt
                d/b/a Checmate

               

            	
              Wells
                Fargo #                       
                

            
	
              Pro
                Staff, Inc.

            	
              Pro
                Staff, Inc.

            	
              Fifth
                Third Bank:

            
	
               

            	 	
              #                       
                

            
	
              Pro
                Staff, Inc.

            	
              Pro
                Staff, Inc.

            	
              JP
                Morgan Chase:

            
	
               

            	 	
              #                       
                

            
	
              Professional
                Staff

            	
              Professional
                Staff

            	
              Fifth
                Third Bank:

            
	
              Management,
                Inc.

            	
              Management,
                Inc.

            	
              #                       
                

            
	
              Professional
                Staff

            	
              Professional
                Staff

            	
              Bank
                of America, NA:

            
	
              Management,
                Inc.

            	
              Management,
                Inc.

            	
              #                       
                

            
	
              Professional
                Staff

            	
              Professional
                Staff

            	
              JP
                Morgan Chase:

            
	
              Management,
                Inc.

            	
              Management,
                Inc.

            	
              #                       
                

            
	
               

            	 	
              #                       
                

            
	
               

            	 	
              #                       
                

            
	
              Professional
                Staff

            	
              Professional
                Staff

            	
              Fifth
                Third Bank:

            
	
              Management,
                Inc. II

            	
              Management,
                Inc. II

            	
              #                       
                

            
	
              Professional
                Staff

            	
              Professional
                Staff

            	
              JP
                Morgan Chase:

            
	
              Management,
                Inc. II

            	
              Management,
                Inc. II

            	
              #                       
                

            
	
              Professional
                Staff

            	
              Professional
                Staff

            	
              Fifth
                Third Bank:

            
	
              Management,
                Inc. Benefit

            	
              Management,
                Inc. Benefit

            	
              #                       
                

            
	
              Trust

            	
              Trust

            	
              #                       
                

            
	
              PSM
                Financial Services,

            	
              PSM
                Financial Services,

            	
              Fifth
                Third Bank:

            
	
              LLC

            	
              LLC

            	
              #                       
                

            


    

     

    Borrower
      acknowledges that Bank has a perfected by control security interest in all
      Deposit Accounts including, but not limited to, the foregoing Deposit Accounts
      pursuant to either Section 9-104(a)(1) or Section 9-104(a)(2) and Section
      9-314(b) of the Uniform Commercial Code. As such, Bank, upon an Event of Default
      under this First Amendment, the Loan Agreement and/or any of the Loan Documents,
      shall have the absolute right to enforce its security interests in any Deposit
      Account deposited with or held by Bank under Part 6 of Article 9 of the Uniform
      Commercial Code and/or under this First Amendment, the Loan Agreement and/or
      any
      of the Loan Documents and to exercise its right of exclusive control under
      the
      control agreements entered into with respect to any Deposit Account not
      deposited with or held by Bank and/or to otherwise exercise its rights under
      this First Amendment, the Loan Agreement and/or any of the Loan Documents;
      provided,however, Bank agrees to distribute any Trust Funds with
      respect to the Deposit Accounts listed in the chart above in accordance with
      the
      following procedures. Borrower shall cause each of the foregoing depositor
      Subsidiaries, immediately upon receipt by such Subsidiary and/or immediately
      upon being known by such Subsidiary, to provide Bank, in writing, with (i)
      all
      required information for Bank to determine that any funds to be distributed
      are
      Trust Funds, (ii) all required information for Bank to direct the respective
      deposit account bank to appropriately distribute such Trust Funds, and (iii)
      the
      date, time, manner, recipient, any other or further information to allow Bank
      to
      timely and properly distribute any Trust Funds. The foregoing information to
      be
      provided to Bank, in writing, shall be sent to Bank via facsimile at (317)
      383-2320, Attn: Mr. William Krummen and the Borrower and/or any Subsidiary
      sending such information shall confirm the Bank's receipt of such information
      verbally via telephone by contacting Mr. William Krummen at (317) 383-2145.
      In
      the event that Borrower or any Subsidiary fails to timely and properly provide
      the required information and notice to Bank with respect to any aspect of
      distribution of any Trust Funds, Bank shall incur no liability and Borrower
      and/or the respective Subsidiary shall completely and fully indemnify Bank
      and
      hold Bank harmless for any damages as well as reimburse Bank for any attorneys'
      fees, costs or expenses incurred as a result of Borrower or any Subsidiary
      failing to timely and properly provide the required information and notice
      to
      Bank with respect to any aspect of distribution of any Trust
      Funds.


    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      7
REPRESENTATIONS AND WARRANTIES.


     

    Section
      7.7 Financial Statements. The Agreement is hereby amended by substituting
      the following new Section 7.7 in lieu of the existing Section 7.7:

     

    Section
      7.7 Financial Statements. All financial statements submitted to the Bank
      have been prepared in accordance with GAAP on a basis, except as otherwise
      noted
      therein, consistent with the previous fiscal year and truly and accurately
      reflect the financial condition of the Borrower and the results of the
      operations of the Borrower as of such date and for the periods indicated. Since
      the date of the most recent financial statement submitted by the Borrower to
      the
      Bank, there has been no material adverse change in the financial condition
      or in
      the assets or liabilities of the Borrower, or any changes except those occurring
      in the ordinary course of business.

     

    Section
      7.16 Bank Accounts. The Agreement is hereby amended by substituting the
      following new Section 7.16 in lieu of the existing Section 7.16:

     

    Section
      7.16 Bank Accounts. All Deposit Accounts and other bank accounts of the
      Borrower and its Subsidiaries other than those set forth in Schedule 7.16
      attached hereto and amended from time to time (the "Other Accounts") are held
      with the Bank or its affiliates. None of the Other Accounts are the primary
      account of the Borrower or any Subsidiary other than as set forth in Schedule
      7.16.

     

    Section
      7.19 Subsidiaries. The Agreement is hereby amended by substituting the
      following new Section 7.19 in lieu of the existing Section 7.19:

     

    Section
      7.19 Subsidiaries. The following is a complete list of all of the
      Subsidiaries of Borrower:


    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    Century
      II ASO, Inc.

    Century
      II Services, Inc. 

    Century
      II Staffing, Inc. 

    Century
      II Staffing TN, Inc. 

    Century
      II Staffing USA, Inc. 

    Commercial
      Solutions, Inc.

    Cornerstone
      Wireless 

    Construction
      Services, Inc.

    CSM,
      Inc.

    Employer
      Solutions Group, Inc. 

    Employer
      Solutions Group of Idaho, Inc.

    Employer
      Solutions Group of SLC, Inc.

    Employer
      Solutions Group of Utah, Inc.

    Employer
      Staffing Group, Inc. 

    ESG
      Achievement, Inc. 

    ESG
      Administration, Inc. 

    ESG
      Assistance, Inc.

    ESG
      Consulting, Inc.

    ESG
      Direction, Inc.

    ESG
      Entities, Inc.

    ESG
      Fulfillment, Inc.

    ESG
      Insurance, Inc. d/b/a Aspen Cove Insurance, Inc.

    ESG
      Management, Inc. 

    ESG
      Offerings, Inc.

    ESG
      Services, Inc.

    ESG
      Success, Inc.

    ESG
      Supervision, Inc.

    Fortune
      Employer Solutions, Inc. 

    Fortune
      Staffing, Inc.

    Fortune
      Strategic Products, Inc. 

    Fortune
      Wireless, Inc.

    James
      H
      Drew Corporation

    James
      H.
      Westbrook & Associates, LLC

    Kingston
      Sales Corporation Magtech 

    Services,
      Inc. Nor-Cote International, 

    Inc.
      Nor-Cote International Limited 

    Nor-Cote
      International (Mexico), Inc.

    Nor-Cote
      International P'1'E Ltd. Nor-Cote (Malaysia) SDN BHD

    Precision
      Employee Management, L.L.C. d/b/a Checkmate

    Pro
      Staff, Inc.

    Professional
      Staff Management, Inc.

    Professional
      Staff Management, Inc. II

    PSM
      Financial Services, LLC

    Sageland
      Flagging, Inc. d/b/a Employer Solutions Staffing Group, Inc.

    Telecom
      Technology, Corp.

    Tennessee
      Guardrail, Inc.


    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    The
      Borrower has the following additional Subsidiaries (i) Innovative
      Telecommunications Consultants, Inc.; (ii) CDG Acquisition Company; (iii)
      Cornerstone Wireless Services, Incorporated; (iv) Fortune Electric, Inc.; (v)
      Murphy Development, Ltd.; (vi) StarQuest Wireless, Inc.; (vii) Women of
      Wrestling, Inc.; (viii) WOW Women of Wrestling Music I, Inc.; (ix) Cornerstone
      Engineering Services, Inc.; and (x) CW Construction Services, LLC (the "Inactive
      Subsidiaries"). The Inactive Subsidiaries are not listed above because such
      Inactive Subsidiaries (a) are no longer operating, (b) do not have any assets,
      (c) do not have any bank accounts, (d) do not have any employees, (e) do not
      have a board of directors, (f) do not have any officers and/or (g) have been
      assumed by certain operating Subsidiaries.

     

    ARTICLE
      8
NEGATIVE COVENANTS.

     

    Section
      8.7 Bank Accounts. The Agreement is hereby amended by substituting the
      following new Section 8.7 in lieu of the existing Section 8.7:

     

    Section
      8.7 Bank Accounts. The Borrower shall not establish any new Deposit
      Accounts or other bank accounts, other than bank accounts established at or
      with
      the Bank, without the prior written consent of the Bank, which consent shall
      not
      be unreasonably withheld.

     

    Section
      8.9 Acquisitions. The Agreement is hereby amended by substituting the
      following new Section 8.9 in lieu of the existing Section 8.9:

     

    Section
      8.9 Acquisitions. The Borrower shall not make any Acquisitions without
      the prior written consent of Bank, in Bank's sole discretion, or any other
      Acquisitions that would cause a default under this Agreement, impair the
      Collateral or otherwise impair Borrower's financial condition.

     

    Section
      8.10 Inactive Subsidiaries. The Agreement is hereby amended by adding the
      following new Section 8.10:

     

    Section
      8.10 Inactive Subsidiaries. Neither the Borrower nor any of the
      Subsidiaries shall (i) revive any of the Inactive Subsidiaries, (ii) operate
      any
      of the Inactive Subsidiaries, (iii) open any bank accounts for any of the
      Inactive Subsidiaries, (iv) transfer assets to the any of the Inactive
      Subsidiaries, (v) hire employees for any of the Inactive Subsidiaries, (vi)
      create a board of directors for any of the Inactive Subsidiaries, (vii) appoint
      officers for any of the Inactive Subsidiaries, (viii) issue and/or transfer
      any
      stock for any of the Inactive Subsidiaries and/or (ix) sell or merge any of
      the
      Inactive Subsidiaries without the Bank's express written
      permission.


    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      9
AFFIRMATIVE COVENANTS.

     

    Section
      9.7 Financial Statements. The Agreement is hereby amended by substituting
      the following new Section 9.7(e) in lieu of the existing Section
      9.7(e):

     

    (e)
      as
      soon as available, and in any event, within thirty (30) days following the
      end
      of each calendar month, a copy of the brokerage statements for Carter M. Fortune
      and the Trust showing their holdings of stock in Eli Lilly & Company and/or
      Belterra Capital Fund LLC in an amount at least equal to Forty Million Dollars
      ($40,000,000.00); provided,however, that such delivery shall be
      deemed made with respect to the shares of Eli Lilly & Company held by Bank.
      The shares of Eli Lilly and Company held by Bank for safekeeping pursuant to
      Section 10.3 shall be included in meeting this minimum requirement.

     

    Section
      9.12 Brokerage Account Section 9.12 of the Agreement is hereby amended by
      deleting Section 9.12 in its entirety.

     

    Section
      9.17 Banking Relationship. The Agreement is hereby amended by
      substituting the following new Section 9.17 in lieu of the existing Section
      9.17:

     

    Section
      9.17 Banking Relationship. The Borrower covenants and agrees, within
      thirty (30) days after the date of this Agreement and at all times thereafter
      during the term of this Agreement, to maintain all of its Deposit Accounts,
      other than the Other Accounts, with the Bank. The Borrower further covenants
      and
      agrees that none of the Other Accounts will be the primary account of the
      Borrower or any Subsidiary other than as set forth in Schedule
      9.17.

     

    ARTICLE
      10 FINANCIAL COVENANTS.

     

    Section
      10.1 Senior Funded Debt to EBITDA Ratio. Section 10.1 of the Agreement is
      hereby amended by deleting Section 10.1 in its entirety.

     

    Section
      10.2 Tangible Net Worth. Section 10.2 of the Agreement is hereby amended
      by deleting Section 10.2 in its entirety.

     

    Section
      10.3 Liquidity of Guarantors. Section 10.3 of the Agreement is hereby
      amended by substituting the following new Section 10.3 in lieu of the existing
      Section 10.3:

     

    Section
      10.3 Liquidity of Guarantors. Carter M. Fortune and/or the Trust shall
      hold the greater of (i) Forty Million Dollars and No Cents ($40,000,000.00)
      or
      (ii) the total amount of Indebtedness personally guaranteed by Carter M. Fortune
      and by the Trust pursuant to the terms of this First Amendment in unpledged
      and
      unencumbered stock in Eli Lilly & Company and/or Belterra Capital Fund LLC,
      tested as of the end of each calendar month. The Borrower shall cause Bank
      to be
      named as an interested third party on                        
Account No.          
      (which account contains Carter M. Fortune's shares of Belterra Capital Fund
      LLC)
      and the Borrower shall cause                        
to provide
      monthly account statements directly to Bank with respect
      to                       
Account No.          .
      Bank will provide copies of such monthly account statements to First Indiana.
      The Borrower has caused the Trust to transfer a minimum of Twenty Million
      Dollars and No Cents ($20,000,000.00) worth of unpledged and unencumbered shares
      of Eli Lilly & Company registered in the name of the Trust to the custody of
      Bank to be physically held by Bank for safekeeping in Indianapolis, Indiana,
      which Twenty Million Dollars and No Cents ($20,000,000.00) worth of unpledged
      and unencumbered shares of Eli Lilly & Company registered in the name of the
      Trust will be released from Bank's custody upon Borrower attaining a cumulative
      EBITDA of at least Three Million Dollars and No Cents ($3,000,000.00), tested
      at
      the end of each fiscal quarter, for any two consecutive quarters commencing
      with
      the fiscal quarter beginning September 1, 2007, so long as no Event of Default
      has occurred and is continuing under the Agreement, as amended by this First
      Amendment; provided,however, in the event that Borrower's
      cumulative EBITDA subsequently falls below Three Million Dollars and No Cents
      ($3,000,000.00), tested at the end of each fiscal quarter, for any two
      consecutive quarters, within forty-five (45) days of such quarter end, Borrower
      shall cause the Trust to transfer a minimum of Twenty Million Dollars and No
      Cents ($20,000,000.00) worth of unpledged and unencumbered shares of Eli Lilly
      & Company registered in the name of the Trust to the custody of Bank to be
      physically held for safekeeping by Bank in Indianapolis, Indiana. The Trust
      is
      permitted to direct the payment of any dividends arising from the Twenty Million
      Dollars and No Cents ($20,000,000.00) worth of unpledged and unencumbered shares
      of Eli Lilly & Company registered in the name of the Trust to Wachovia Bank,
      N.A. or such other financial institution of its choice. Notwithstanding anything
      to the contrary herein, while the Twenty Million Dollars and No Cents
      ($20,000,000.00) worth of unpledged and unencumbered shares of Eli Lilly &
Company registered in the name of the Trust are in the custody of Bank, the
      Trust agrees that it will not attempt to remove (by itself or through a
      third-party) such shares from the Bank's custody and any attempt to remove
      such
      shares from the Bank's custody will be an immediate Event of Default hereunder.
      Further, despite a demand by the Trust or any other authorized person or entity,
      Bank will not be required to return such shares after the occurrence of any
      Event of Default, while any Event of Default is continuing, and/or if the
      foregoing target EBITDA has not been satisfied.


    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    Section
      10.4 Fixed Charge Coverage Ratio. Section 10.4 of the Agreement is hereby
      amended by substituting the following new Section 10.4 in lieu of the existing
      Section 10.4:

     

    Section
      10.4 Fixed Charge Coverage Ratio. The Borrower shall maintain a Fixed
      Charge Coverage Ratio, tested at the end of each fiscal quarter, not less than
      as follows:

     

    
      	
              Quarter
                ending August 31, 2007:

            	
              0.80
                to 1.00 

               

            
	
              Quarter
                ending November 30, 2007:

            	
              1.00
                to 1.00 

               

            
	
              Quarter
                ending February 28, 2008:

            	
              0.80
                to 1.00 

               

            
	
              Quarter
                ending May 31, 2008:

            	
              1.00
                to 1.00 

               

            
	
              Quarter
                ending August 31, 2008:

            	
              1.00
                to 1.00

               

            
	
              Quarter
                ending November 30, 2008 and at all times thereafter:

            	
              1.15
                to 1.00

               

            


    

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    10.5
      .5
Minimum Shareholders' Equity. The Agreement is hereby amended by
      adding the following new Section 10.5:


     

    Section
      10.5 Minimum Shareholder's Equity. The shareholder's equity in the
      Borrower, as determined in accordance with GAAP, as of May 31, 2007 and at
      all
      times thereafter, must be at least Fifteen Million Dollars and No Cents
      ($15,000,000.00).


     

    Section
      10.6 Funded Debt/Total Capitalization Ratio. The Agreement is hereby
      amended by adding the following new Section 10.6:


     

    Section
      10.6 Funded Debt/Total Capitalization Ratio. The Borrower shall maintain
      a ratio of Funded Debt to Total Capitalization, tested at the end of each fiscal
      quarter, of not greater than:


     

    
      	
              Quarter
                ending August 31, 2007:

            	
              0.75
                to 1.00

               

            
	
              Quarter
                ending November 30, 2007 and at all times thereafter:

            	
              0.70
                to 1.00

               

            


    

     

    Section
      10.7 Guarantees. The Agreement is hereby amended by adding the following
      new Section 10.7:


     

    Section
      10.7 Guarantees. Upon Borrower attaining a Senior Funded Debt to EBITDA
      Ratio of 3.00 to 1.00 or less on a rolling four (4) quarter basis, tested at
      the
      end of each fiscal quarter, the Guarantees of Carter M. Fortune, John M. Fisbeck
      and the Trust will be deemed released; provided,however, that upon
      the Senior Funded Debt to EBITDA Ratio attaining a ratio greater than 3.00
      to
      1.00, tested at the end of each fiscal quarter, the Guarantees of Carter M.
      Fortune, John M. Fisbeck and the Trust shall immediately and automatically
      be
      revived and shall be reinstated in full force and effect without the need for
      further execution or consent from any Guarantor.


     

    ARTICLE
      11 EVENTS OF DEFAULT.


     

    Section
      11.3 Nonperformance. Section 11.3 of the Agreement is hereby amended by
      substituting the following new Section 11.3 in lieu of the existing Section
      11.3:


     

    Section
      11.3 Nonperformance. Any material failure to perform or default in the
      performance of any covenant, condition or agreement contained in this Agreement
      that is not cured within fifteen (15) days of receiving notice thereof;
provided,however, any material failure to perform or default of
      Section 10.3 (Liquidity of Guarantors) will be an immediate default not subject
      to any cure period or notice period.


    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      12 REMEDIES.


     

    Section
      12.6 Attorney-in-Fact. Section 12.6 of the Agreement is hereby amended by
      substituting the following new Section 12.6 in lieu of the existing Section
      12.6:


     

    Section
      12.6 Attorney-in-Fact. The Borrower hereby irrevocably makes, constitutes
      and appoints the Bank (and any officer of the Bank or any Person designated
      by
      the Bank for that purpose) as the Borrower's true and lawful proxy and
      attorney-in­fact (and agent-in-fact) in the Borrower's name, place and
      stead, with full power of substitution, to (i) take such actions as are
      permitted in this Agreement, (ii) execute such financing statements and other
      documents and to do such other acts as the Bank may require to perfect and
      preserve the Bank's security interest in, and to enforce such interests in
      the
      Collateral, and (iii) carry out any remedy provided for in this Agreement,
      including, without limitation, endorsing the Borrower's name to checks, drafts,
      instruments and other items of payment, and proceeds of the Collateral,
      executing change of address forms with the postmaster of the United States
      Post
      Office serving the address of the Borrower, changing the address of the Borrower
      to that of the Bank, opening all envelopes addressed to the Borrower and
      applying any payments contained therein to the Obligations. The Borrower hereby
      acknowledges that the constitution and appointment of such proxy and
      attorney-in-fact are coupled with an interest and are irrevocable. The Borrower
      hereby ratifies and confirms all that said attorney-in-fact may do or cause
      to
      be done by virtue of any provision of this Agreement.

     

    ARTICLE
      13 MISCELLANEOUS.


     

    Section
      13.16 Notices. Section 13.16 of the Agreement is hereby amended by
      substituting the following new Section 13.16 in lieu of the existing Section
      13.16:


     

    Section
      13.16 Notices. Except as otherwise provided herein, the Borrower waives
      all notices and demands in connection with the enforcement of the Bank's rights
      hereunder. All notices, requests, demands and other communications provided
      for
      hereunder shall be in writing, sent by certified or registered mail, postage
      prepaid, by facsimile, by overnight courier, telegram or delivered in person,
      and addressed as follows:


     

    
      	
               

            	
              If
                to the Borrower:

            	
              Fortune
                Industries, Inc.

            


    

    
      	
               

            	
              6402
                Corporate Drive

            


    

    
      	
               

            	
              Indianapolis,
                Indiana 46278

            


    

    
      	
               

            	
              Attention:
                Mr. Carter M. Fortune

            


    

     

    
      	
               

            	
              with
                a copy to its Counsel:

            	
              Drewry
                Simmons Vornehm, LLP 8888

            


    

    
      	
               

            	
              Keystone
                Crossing, Suite 1200

            


    

    
      	
               

            	
              Indianapolis,
                Indiana 46240

            


    

    
      	
               

            	 	
              Attention:
                Mr. Robert Milford, Esq.

            


    


    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    
      	
               

            	
              If
                to the Bank:

            	
              Fifth
                Third Bank

            


    

    
      	
               

            	
              251
                North Illinois Street, Suite 1200

            


    

    
      	
               

            	
              Indianapolis,
                Indiana 46204

            


    

    
      	
               

            	
              Attention:
                Mr. William Krummen

            


    

    


    
      	
               

            	
              with
                a copy to its Counsel:

            	
              Barnes
                & Thornburg LLP

            


    

    
      	
               

            	
              11
                South Meridian Street

            


    

    
      	
               

            	
              Indianapolis,
                Indiana 46204

            


    

    
      	
               

            	
              Attention:
                Mr. Alan K. Mills, Esq.

            


    

    


    
      	
               

            	
              If
                to First Indiana:

            	
              First
                Indiana Bank, N.A.

            


    

    
      	
               

            	
              135
                North Pennsylvania Street

            


    

    
      	
               

            	
              Indianapolis,
                Indiana 46204

            


    

    
      	
               

            	
              Attention:
                Mr. Carl B. Ruthrauff

            


    

     

    or,
      as to
      each party, at such other address as shall be designated by such party in a
      written notice to each other party complying as to delivery with the terms
      of
      this subsection. No notice to or demand on the Borrower in any case shall
      entitle the Borrower to any other or further notice or demand in similar or
      other circumstances.

     

    Section
      13.20 LIBOR Regulatory Change. Section 13.20 of the Agreement is hereby
      amended by substituting the following new Section 13.20 in lieu of the existing
      Section 13.20:

     

    Section
      13.20 LIBOR Regulatory Change. In addition, if, after the date hereof, a
      Regulatory Change shall, in the reasonable determination of the Bank, make
      it
      unlawful for the Bank to make or maintain the Loans, then the Bank shall
      promptly notify the Borrower and none of the Loans may be advanced thereafter.
      In addition, at the Bank's option, the Loans shall be immediately (i) converted
      from the Loan Rate to an interest rate based on the Prime Rate on the last
      Business Day of the then existing Interest Period or on such earlier date as
      required by law, or (ii) due and payable on the last Business Day of the then
      existing Interest Period or on such earlier date as required by law, all without
      further demand, presentment, protest or notice of any kind, all of which are
      hereby waived by the Borrower.

     

    Section
      13.21 USA Patriot Act. Section 13.21 of the Agreement is hereby amended
      by substituting the following new Section 13.21 in lieu of the existing Section
      13.21:

     

    Section
      13.21 USA Patriot Act.IMPORTANT INFORMATION
ABOUT PROCEDURES FOR OPENING A NEW
ACCOUNT.
To
      help the government fight the funding of terrorism
      and money laundering activities, Federal law requires all financial institutions
      to obtain, verify, and record information that identifies each person or entity
      that opens an account, including any deposit account, treasury management
      account, loan, other extension of credit, or other financial services product.
      What this means for the Borrower: When the Borrower opens an account, if the
      Borrower is an individual, the Bank will ask for the Borrower's name,
      residential address, date of birth, and other information that will allow the
      Bank to identify the Borrower, and, if the Borrower is not an individual, the
      Bank will ask for the Borrower's name, employer identification number, business
      address, and other information that will allow the Bank to identify the
      Borrower. The Bank may also ask, if the Borrower is an individual, to see the
      Borrower's driver's license or other identifying documents, and, if the Borrower
      is not an individual, to see the Borrower's legal organizational documents
      or
      other identifying documents.


    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    PART
      II. LIMITED WAIVER

     

    Subject
      to the terms and conditions set forth herein, the Bank hereby waives the
      Existing Defaults; provided that such waiver shall be limited precisely
      as written and shall not be deemed or otherwise construed to constitute an
      amendment to the Agreement or any other Loan Document or a waiver of any other
      default, or to prejudice any right, power or remedy which the Bank may now
      have
      or may have in the future under or in connection with the Agreement or any
      other
      Loan Document (after giving effect to this First Amendment), all of which
      rights, powers and remedies are hereby expressly reserved by the
      Bank.

     

    PART
      III. CONTINUING EFFECT


     

    Except
      as
      expressly modified herein:

    


    (a)          all
      terms, conditions, representations, warranties and covenants contained in the
      Agreement shall remain the same and shall continue in full force and effect,
      interpreted, wherever possible, in a manner consistent with this First
      Amendment; provided,however, in the event of any irreconcilable
      inconsistency, this First Amendment shall control;


     

    (b)          the
      representations and warranties contained in the Agreement shall survive this
      First Amendment in their original form as continuing representations and
      warranties of Borrower; and

     

    (c)          capitalized
      terms used in this First Amendment, and not specifically herein defined, shall
      have the meanings ascribed to them in the Agreement.


     

    In
      consideration hereof, Borrower represents, warrants, covenants and agrees
      that:

    


    (aa)
      each
      representation and warranty set forth in the Agreement, as hereby amended,
      remains true and correct as of the date hereof in all material respects, except
      to the extent that such representation and warranty is expressly intended to
      apply solely to an earlier date and except changes reflecting transactions
      permitted by the Agreement;


     

    (bb)
      there currently exist no offsets, counterclaims or defenses to the performance
      of the Obligations (such offsets, counterclaims or defenses, if any, being
      hereby expressly waived);


     

    (cc)
      except as expressly waived in this First Amendment, there has not occurred
      any
      default; and


     

    (dd)
      after giving effect to this First Amendment and any transactions contemplated
      hereby, no default is or will be occasioned hereby or thereby.


    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    PART
      IV. CONDITIONS PRECEDENT

     

    Notwithstanding
      anything contained in this First Amendment to the contrary, Bank shall have
      no
      obligation under this First Amendment until each of the following conditions
      precedent have been fulfilled to the satisfaction of Bank:

     

    (a)          Bank
      shall have received two (2) original copies of each of the following, in form
      and substance satisfactory to Bank:

     

    (i)           a
      duly executed copy of this First Amendment in the form prescribed by
      Bank;

     

    (ii)          a
      duly executed certificate of the Secretary or any Assistant Secretary of
      Borrower (i) certifying as to the Resolutions of the Board of Directors of
      Borrower authorizing the execution, delivery and performance of this First
      Amendment, and (ii) certifying as complete and correct as to attached copies
      of
      the Articles of Incorporation and By-Laws of Borrower or certifying that such
      Articles of Incorporation and By-Laws have not been amended (except as shown)
      since the previous delivery thereof to Bank;

     

    (iii)         a
      Revolving Loan Guaranty, duly executed by Carter M. Fortune in the form
      prescribed by Bank;

     

    (iv)         a
      Revolving Loan Guaranty, duly executed by John F. Fisbeck in the form prescribed
      by Bank;

     

    (v)          a
      Revolving Loan Guaranty, duly executed by the Trust in the form prescribed
      by
      Bank;

     

    (vi)         a
      Term Loan Guaranty, duly executed by the Trust in a form prescribed by
      Bank;

     

    (vii)        a
      duly executed Affidavit of Trust and Trustee's Certificate from the Trust (i)
      certifying as to the Resolutions of the Trustees of the Trust authorizing the
      execution, delivery and performance of the Revolving Loan Guaranty and Term
      Loan
      Guaranty and any other documents provided for in this First Amendment to which
      the Trust is a Guarantor, and (ii) certifying as complete and correct as to
      attached copies of the Trust Agreement of the Trust;

     

    (viii)       an
      Amended and Restated Term Loan Guaranty, duly executed by each of the existing
      Term Loan Guarantors in the form prescribed by Bank;

     

    (ix)          an
      Amended and Restated Revolving Loan Guaranty, duly executed by each of the
      existing Revolving Loan Guarantors in the form prescribed by Bank;

     

    (x)           an
      updated list of all Subsidiaries;

     

    (xi)          an
      updated organization chart of the Borrower and all Subsidiaries, which
      organization chart shall include, inter alia, the state of
      incorporation of the Borrower and each Subsidiary; the principal place of
      business of the Borrower and each Subsidiary; the corporate headquarters of
      the
      Borrower and each Subsidiary; all d/b/a and/or f/k/a names of the Borrower
      and
      each Subsidiary; the name of the president of the Borrower and each Subsidiary;
      and the ownership of the Borrower and each Subsidiary;


    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    (xii)         an
      Amended and Restated Stock Pledge Agreement, duly executed by each Subsidiary
      that is currently a party to the Stock Pledge Agreement;

     

    (xiii)        a
      Stock Pledge Agreement, duly executed by each Subsidiary that is not a party
      to
      the Stock Pledge Agreement;

     

    (xiv)       
      an Amended and Restated Security Agreement, duly executed by each Subsidiary
      that is currently a party to the Security Agreement;

     

    (xv)        
      a Security Agreement, duly executed by each Subsidiary that is not a party
      to
      the Security Agreement;

     

    (xvi)       
      duly executed Revolving Loan Guarantees by any Subsidiaries that are not
      currently Guarantors;

     

    (xvii)      
      duly executed Control Agreements as requested by the Bank with respect to any
      Deposit Accounts or other bank accounts listed on Schedule 7.16 and Schedule
      9.17;

     

    (xviii)     
      duly executed Irrevocable Stock Powers of each Subsidiary that is a party to
      the
      Stock Pledge Agreement endorsed in blank;

     

    (xix)       
      duly executed certificate of the Secretary or any Assistant Secretary of each
      Subsidiary (i) certifying as to the Resolutions of the Board of Directors of
      each Subsidiary authorizing the execution, delivery and performance of any
      Guarantees, the Stock Pledge Agreement, the Security Agreement and/or any other
      Loan Document(s) relating to this First Amendment, and (ii) certifying as
      complete and correct as to attached copies of the Articles of Incorporation
      and
      By-Laws of such Subsidiary or certifying that such Articles of Incorporation
      and
      By-Laws have not been amended (except as shown) since the previous delivery
      thereof to Bank;

     

    (xx)         the
      updated and current personal financial statements and 2006 tax returns of Carter
      M. Fortune and John F. Fisbeck;

     

    (xxi)        the
      updated and current financial statement and 2006 tax return of the Trust;
      and

     

    (xxii)       duly
      executed Certificates of Good Standing or Certificates of Existence, as
      applicable, for the Borrower and each Subsidiary.

     

    (b)           Receipt
      of at least Twenty Million Dollars and No Cents ($20,000,000.00) worth of
      unpledged and unencumbered shares of Eli Lilly & Company registered in the
      name of the Trust as more fully set forth in Section 10.3 of this First
      Amendment.

     

    (c)           Borrower
      shall have delivered to Bank a fee for this First Amendment in the amount of
      Thirty-Seven Thousand Five Hundred Dollars and No Cents
      ($37,500.00).

     

    (d)           Borrower
      shall have reimbursed Bank for all legal fees and other expenses incurred by
      Bank in connection with this First Amendment and the transactions contemplated
      hereby.


    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    (e)           All
      legal matters incident to this First Amendment shall be reasonably satisfactory
      to Bank and its counsel.

     

    [signature
      page follows]



    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    Exhibit
      A

    Borrowing
      Base Certificate 

     

    Borrowing
      Base Certificate

    Fortune
      Industries, Inc.

     

    For
      the
      Month Ending:

     

    
      	
              A.
                Accounts Receivable Contribution

            	 	 
	
              Total
                Trade Accounts Receivable

            	
              $

            	 
	
              less:
                A/R> 90 days past invoice date

            	
              $

            	 
	
              less:
                bonded jobs

            	
              $

            	 
	
              less:
                retainage

            	
              $

            	 
	
              less:
                foreign A/R

            	
              $

            	 
	
              less:
                all other Ineligible Accounts

            	
              $

            	 
	
              equals:
                Eligible Accounts Receivable

            	
              $

            	 
	
              AIR
                Advance Rate

            	 	 
	
              NR
                Availability

            	
              $

            	 
	 	 	 
	
              B.
                Inventory Contribution

            	 	 
	
              Total
                Onsite Inventory

            	
              $

            	 
	
              less:
                WIP

            	
              $

            	 
	
              less:
                slow / obsolete

            	
              $

            	 
	
              less:
                any other Ineligible Inventory

            	
              $

            	 
	
              equals:
                Eligible Onsite Inventory

            	
              $

            	 
	
              Onsite
                Advance Rate

            	 	 
	
              Onsite
                Inventory Availability

            	
              $

            	 
	 	 	 
	
              Total
                Offsite Inventory

            	
              $

            	 
	
              less:
                any offsite Ineligible Inventory

            	
              $

            	 
	
              equals:
                Eligible Offsite Inventory

            	
              $

            	 
	
              Offsite
                Advance Rate

            	 	 
	
              Offsite
                Inventory Availability

            	
              $

            	 
	 	 	 
	
              C.
                Fixed Assets Contribution

            	 	 
	
              $3,500,000
                as of 8/31/06

            	
              $

            	 
	
              less:
                $500,000 at 11/30/06

            	
              $

            	 
	
              less:
                $1,000,000 at 2/28/07

            	
              $

            	 
	
              less:
                $1,500,000 at 5/31/07

            	
              $

            	 
	
              less:
                $2,000,000 at 8/31/07

            	
              $

            	 
	
              less:
                $2,500,000 at 11/30/07

            	
              $

            	 
	
              less:
                $3,000,000 at 2/28/08

            	
              $

            	 
	
              less:$3,500,000
                at 5/31/08

            	
              $

            	 
	
              equals:
                Fixed Asset Availability

            	
              $

            	 
	 	 	 
	
              D.
                Total Availability for Line of Credit

            	
              $

            	 
	
              (A)
                AIR Availability

            	
              $

            	 
	
              (B)
                Onsite Inventory Availability

            	
              $

            	 
	
              (
                C
                ) Offsite Inventory Availability

            	
              $

            	 
	
              (D)
                Fixed Asset Availability

            	
              $

            	
               

            
	
              Total
                Availability Under Line of Credit

            	
              $

            	 Maximum
              Availability = $15,000,000
	
              less:
                Outstandings as of 8/31/07

            	
              $

            	 
	
              Net
                Availability Under Line

            	
              $

            	 If
              <ZERO, line must be paid down
	 	 	 
	 	 	 
	Certified
              By:	Name:	 
	 	Title:	 
	 	Sate:	 


    


    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    


    Schedule
      7.16 & 9.17

     

    
      	
              Subsidiary
                Name

            	
              Bank
                Account Name

            	
              Account
                Number

            	
              Primary

              Account

            	
              Fiduciary

              Account

            
	
              Century
                II ASO, Inc.

            	
              Century
                H ASO, Inc.

            	
              Bank
                of America:

            	
              No

            	
              Yes

            
	
               

            	 	
              #               
                      

            	
               

            	
               

            
	
              Century
                U Services, Inc.

            	
              Century
                II Services, Inc.

            	
              Bank
                of America:

            	
              No

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              Century
                II Staffing TN, Inc.

            	
              Century
                II Staffing TN,

            	
              Bank
                of America:

            	
              No

            	
              Yes

            
	 	
              Inc.

            	
              #                     
                

            	
               

            	
               

            
	
              Century
                II Staffing USA, Inc.

            	
              Century
                II Staffing USA,

            	
              Bank
                of America:

            	
              No

            	
              Yes

            
	
               

            	
              Inc.

            	
              #                     
                

            	
               

            	
               

            
	
              Employer
                Solutions Group of

            	
              Employer
                Solution Group

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
              Idaho,
                Inc.

            	 	
              #                     
                

            	
               

            	
               

            
	
              Employer
                Solutions Group of

            	
              ESG
                of SLC - Operating

            	
              Key
Bank:

            	
              Yes

            	
              Yes

            
	
              SLC,
                Inc.

            	
              Account

              ESG
                of SLC - Payroll

            	
              #                     
                

              Key
                Bank:

            	
              No

            	
              Yes

            
	
               

            	
              ESG
                of SLC-CDA Maine

            	
              #                     
                

              Key
                Bank:

            	
              No

            	
              No

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              Employer
                Staffing Group,

            	
              Employer
                Solutions Group

            	
              Key
                Bank:

            	
              Yes

            	
              No

            
	
              Inc.

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Achievement, Inc.

            	
              ESG
                Achievement, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Administration, Inc.

            	
              ESG
                Administration, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Assistance, Inc.

            	
              ESG
                Assistance, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Consulting, Inc.

            	
              ESG
                Consulting, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Direction, Inc.

            	
              ESG
                Direction, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Entities, Inc.

            	
              ESG
                Entities, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Fulfillment, Inc.

            	
              ESG
                Fulfillment, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Insurance, Inc. d/b/a

            	
              Aspen
                Cove/Neal Dastrup

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
              Aspen
                Cove Insurance, Inc.

            	
              Insurance
                - Operating

              Aspen
                Cove Insurance-

            	
              #                     
                

              Key
                Bank:

            	
              No

            	
              No

            
	
               

            	
              Operating

              Aspen
                Cove Insurance-

            	
              #                     
                

              Key
                Bank:

            	
              No

            	
              No

            
	 	
              Payroll

            	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Management, Inc.

            	
              ESG
                Management, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Offerings, Inc.

            	
              ESG
                Offerings, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Services, Inc.

            	
              ESG
                Services, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	
               

            	 	
              #                     
                

            	
               

            	
               

            
	
              ESG
                Success, Inc.

            	
              ESG
                Success, Inc.

            	
              Key
                Bank:

            	
              Yes

            	
              Yes

            
	 	 	
              #                     
                

            	
               

            	 


    

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    


    
      	
              Subsidiary
                Name

            	
              Bank
                Account Name

            	
              Account
                Number

            	
              Primary

              Account

            	
              Fiduciary

              Account

            
	
              ESG
                Supervision, Inc.

            	
              ESG
                Supervision, Inc.

            	
              Key
                Bank:

              #                     
                

            	
              Yes

            	
              Yes

            
	
              Fortune
                Staffing, Inc.

            	
              Fortune
                Staffing, Inc.

            	
              Bank
                of America, NA:

              #                     
                

            	
              No

            	
              Yes

            
	
              Nor-Cote
                International Pte

              Ltd

            	
              Nor-Cote
                International Pte

              Ltd

            	
              Citibank
                Singapore Ltd:

              #                     
                

              #                     
                

            	
              Yes

              No

            	
              No

              No

            
	
              Nor-Cote
                International, Inc.

            	
              Nor-Cote
                International,

              c.

            	
              National
                City Bank:

              #                     
                

              National
                City Bank:

              #                     
                

            	
               

              No

               

              No

            	
               

              No

               

              No

            
	
              Nor-Cote
                International,

              Limited

            	
              Nor-Cote
                International,

              Limited

            	
              Barclays
                Bank:

              #                     
                

            	
              Yes

            	
              No

            
	
              Precision
                Employee

              Management,
                L.L.C. d/b/a

              Checkmate
                Professional

              Employer

            	
              Precision
                Employee

              Management
                d/b/a

              Checkmate

            	
              Chase
                #                     
                

              Wells
                Fargo #                     
                

              Chase
                #                     
                

            	
              Yes

              Yes

              No

            	
              Yes

              Yes

              No

            
	
              No
                Staff, Inc.

            	
              Pro
                Staff, Inc.

            	
              JP
                Morgan Chase:

              #                     
                

            	
              No

            	
              Yes

            
	
              Professional
                Staff

              Management,
                Inc.

            	
              Professional
                Staff

              Management,
                Inc.

            	
              Bank
                of America, NA:

              #                     
                

              JP
                Morgan Chase:

              #                     
                

              JP
                Morgan Chase:

              #                     
                

              JP
                Morgan Chase:

              #                     
                

            	
              No

               

              No

               

              No

               

              No

            	
              Yes

               

              Yes

               

              Yes

               

              Yes

            
	
              Professional
                Staff

              Management,
                Inc. II

            	
              Professional
                Staff

              Management,
                Inc. II

            	
              JP
                Morgan Chase:

              #                     
                

            	
               

              No

            	
               

              Yes

            
	
              PSM
                Financial Services, LLC

            	
              PSM
                Financial Services,

              LLC

            	
              JP
                Morgan Chase:

              #                     
                

            	
               

              No

            	
               

              No

            
	
              Sageland
                Flagging, Inc. d/b/a

              Employer
                Solutions Staffing

              Group,
                Inc.

            	
              Employer
                Solutions

              Staffing
                Group - General

              Account

            	
              Key
                Bank:

              #                     
                

            	
               

              Yes

            	
               

              Yes

            


    


    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    EXECUTION
      COPY

     

    IN
      WITNESS WHEREOF, Borrower and
      Bank have caused this First Amendment to be executed by their respective
      officers duly authorized as of the date first above written.

     

     

    
      	
              “Borrower” 

            	 	
              “Bank” 

            	 
	 	 	 	 	 	 
	
              FORTUNE
                INDUSTRIES, INC. 

            	 	
              FIFTH
                THIRD BANK (FORMERLY KNOWN AS 

            	 
	 	 	 	
              FIFTHE
                THIRD BANK (CENTRAL INDIANA) 

            	 
	
              By:

            	
              /s/
                John F. Fisbeck

            	 	 	 	 
	 	 	 	
              By:

            	
              /s/illegible

            	 
	
              Its:

            	
              CEO

            	 	 	 	 
	 	 	 	
              Its

            	
              Vice
                President

            	 


    

     

    "FIRST
      INDIANA"

     

    FIRST
      INDIANA BANK, N.A., AND ITS

    SUCCESSORS
      AND ASSIGNS, AS A PARTICIPANT

    UNDER
      THAT CERTAIN PARTICIPATION

     

    AGREEMENT
      MADE AS OT AUGUST 31,
      2006

    


    
      	
              By:

            	  
              	 
	
              Its:

            	  
              	 


    

     

    


    [notary
      page follows]


    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    EXECUTION
      COPY

     

    
      	
              STATE
                OF INDIANA

            	
              )

            


    

    
      	
               

            	
              )

            	
              SS:

            


    

    
      	
              COUNTY
                OF MARION

            	
              )

            


    

    


    Before,
      me, a Notary Public in and for said
      County                    
State, personally appeared

     
      .                                           , by
      me known to be
      the                                         
 of
FORTUNE
INDUSTRIES,
      INC., who, after
      having been duly sworn, acknowledged the execution of the foregoing FIRST AMENDMENT TO LOAN AND
      SECURITY
      AGREEMENT for and on behalf of FORTUNE
      INDUSTRIES, INC.

    


    Witness
      my hand and Notarial Seal this  day of September,
      2007. 

    
      	
               

            	 	 	 
	ROBIN
              SULLIVAN	 	 	 
	
              Hendricks
                County

            	
              Notary
                Signature    

            	
              /s/illegible

            	 


    

    My
      Commission Expires :June 29, 2014

    


    
      	 	
              Notary,
                Printed      

            	
              illegible

            	 


    

     

     

    27