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                                                                    EXHIBIT 10.1

                            First Union National Bank
                              Portfolio Management
                                     PA 1310
                             123 South Broad Street
                      Philadelphia, Pennsylvania 19109-1199
                                Fax 215-985-3143

                                January 30, 1998


Relland Winand
Chief Financial Officer
ECC International Corp.
176 Strafford Ave.
Wayne, PA  19087-3377

Dear Rell:

         Reference is made to that certain:

         1. Term Loan and Revolving Credit Agreement, dated as of September 20,
1994 (together with all amendments and modifications thereto) by and between ECC
International Corp. ("ECC"), and First Fidelity Bank, National Association, (the
"Bank"; now named First Union National Bank), and all of the documents,
instruments and agreements executed in connection therewith (collectively, the
"ECC Loan Documents").

         2. Revolving Credit Agreement, dated as of September 20, 1994 (together
with all amendments and modifications thereto), by and between ECC Simulation
Limited ("Simulation," and, together with ECC, the "Borrowers"), and the Bank
and all of the documents, instruments and agreements executed in connection
therewith (collectively, the "Simulation Loan Documents" and, together with the
ECC Loan Documents, the "Loan Documents").

         Terms capitalized but not defined herein shall have the meanings
ascribed thereto in the Loan Documents.

         By letter agreement dated December 19, 1997, the Borrowers and the Bank
agreed to modify Section P.1 of the Term Loan and Revolving Credit Agreement to
substitute $3,000,000.00 for $2,000,000.00 where it appears therein
(representing the maximum amount ECC may lend to Simulation) for the period
ending January 31, 1998 (the "Temporary Modification"). The Borrowers have
requested that the Bank
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extend the Temporary Modification through February 13, 1998, and the Bank has
agreed to do so pursuant to the terms hereof.

         The Borrowers hereby affirm, as of the date hereof, the representations
and warranties set forth in the Loan Documents exactly as if they were made on
and as of the date hereof, except where disclosed to the Bank in writing prior
to the date hereof or where immaterial. The Borrowers represent and warrant that
there is no breach of any term, covenant or provision of the Loan Documents and
that no Event of Default or other event which, with the passage of time, the
giving of notice, or both, would become an Event of Default has occurred and is
continuing. The Borrowers agree that the Loan Documents are binding and
enforceable against the Borrowers pursuant to the terms thereof and the
Borrowers have no defenses, set-offs, or counterclaims to their obligations
thereunder.

         In reliance upon the Borrowers' reaffirmation and representations and
warranties stated above, the Bank agrees to the extension of the Temporary
Modification.

         All other terms, covenants and conditions of the Loan Documents are
hereby reaffirmed, ratified and confirmed in all respects and shall remain in
full force and effect. Nothing contained herein is intended to be or shall be
construed as a waiver of any default, Event of Default, or any of the Bank's
rights and remedies under the Loan Documents and applicable law, all of which
are expressly reserved and preserved.

         Please acknowledge your receipt and acceptance of this letter by
signing below (and having the guarantors identified below also sign where
indicated) and returning a copy to the Bank. Upon the Bank's receipt of an
executed copy of this letter, this letter will become effective.


                                            Sincerely yours,

                                            FIRST UNION NATIONAL BANK

                                            By:  /s/ Suzanne S. Storm

                                            Name:  Suzanne S. Storm
                                            Title: Senior Vice President


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THE UNDERSIGNED ACKNOWLEDGE, CONSENT AND AGREE TO THE FOREGOING TERMS, COVENANTS
AND CONDITIONS AND AGREE TO BE BOUND THEREBY.

Date:  January 30, 1998

                                            BORROWER
ATTEST:                                     ECC INTERNATIONAL CORP.


By:  /s/ Relland Winand                     By:  /s/ George W. Murphy
    ------------------------------              ------------------------------
Name:  Relland Winand                       Name:  George W. Murphy
Title: Vice President, Finance              Title: President


                                            GUARANTOR
ATTEST:                                     ECC SIMULATION LIMITED


By:  /s/ Relland Winand                     By:  /s/ George W. Murphy
    ------------------------------              ------------------------------
Name:  Relland Winand                       Name:  George W. Murphy
Title: Secretary                            Title: President


                                            GUARANTOR
ATTEST:                                     EDUCATIONAL COMPUTER CORPORATION


By:  /s/ Relland Winand                     By:  /s/ George W. Murphy
    ------------------------------              ------------------------------
Name:  Relland Winand                       Name:  George W. Murphy
Title: Secretary/Treasurer                  Title: President


                                            GUARANTOR
ATTEST:                                     ECC INTERNATIONAL, INC.


By:  /s/ Relland Winand                     By:  /s/ George W. Murphy
    ------------------------------              ------------------------------
Name:  Relland Winand                       Name:  George W. Murphy
Title: Secretary/Treasurer                  Title: President



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                                            BORROWER
ATTEST:                                     ECC SIMULATION LIMITED


By:  /s/ Relland Winand                     By:  /s/ George W. Murphy
    ------------------------------              ------------------------------
Name:  Relland Winand                       Name:  George W. Murphy
Title: Secretary                            Title: President


                                            GUARANTOR
ATTEST:                                     EDUCATIONAL COMPUTER CORPORATION


By:  /s/ Relland Winand                     By:  /s/ George W. Murphy
    ------------------------------              ------------------------------
Name:  Relland Winand                       Name:  George W. Murphy
Title: Secretary/Treasurer                  Title: President


                                            GUARANTOR
ATTEST:                                     ECC INTERNATIONAL, INC.


By:  /s/ Relland Winand                     By:  /s/ George W. Murphy
    ------------------------------              ------------------------------
Name:  Relland Winand                       Name:  George W. Murphy
Title: Secretary/Treasurer                  Title: President


                                            GUARANTOR
ATTEST:                                     ECC INTERNATIONAL CORP.


By:  /s/ Relland Winand                     By:  /s/ George W. Murphy
    ------------------------------              ------------------------------
Name:  Relland Winand                       Name:  George W. Murphy
Title: Vice President, Finance              Title: President



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