**Exhibit10.96**

 

**AMENDMENTNO. 2**

**to**

**LOAN ANDSECURITY AGREEMENT**

 

THIS AMENDMENT NO.2 to LOAN AND SECURITY AGREEMENT (the “***Amendment”***),dated as of March 30, 2009, between **ISI SECURITY GROUP, INC.**(the “***Borrower”***) and **THE PRIVATEBANK AND TRUST COMPANY** (the “***Bank”***).

 

**WITNESSETH**:

 

WHEREAS, the Borrower andthe Bank are parties to the Loan and Security Agreement dated as of October 3,2008, as amended by Amendment No. 1 to Loan and Security Agreement, datedas of January 8, 2009 (the “***Loan Agreement”***)(capitalized terms used and not otherwise defined herein shall have the meaningascribed thereto in the Loan Agreement); and

 

WHEREAS, the Borrower hasrequested and the Bank has agreed to the amendments to the Loan Agreement morefully set forth herein; and

 

WHEREAS, such amendmentsshall be of benefit, either directly or indirectly, to the Borrower;

 

NOW THEREFORE, inconsideration of the covenants, conditions and agreements hereinafter setforth, the parties hereto agree as follows:

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1.             Amendments.  Upon andafter the Amendment Effective Date (as defined below)

 

(a)           Section 10.5 of the Loan Agreement is restated and amended in itsentirety as follows:

 

(i)            Maximum Capital Expenditures.  (i) Forthe fiscal quarters ending March 31, 2009, June 30, 2009 and September 30,2009, the Company and its Subsidiaries, on a consolidated basis, shall not makeCapital Expenditures in excess of $300,000 per fiscal quarter; and (ii) forthe twelve (12) month period ending on December 31, 2009 and each twelve(12) month period ending on the last day of each fiscal quarter thereafter, theCompany and its Subsidiaries, on a consolidated basis, shall not make CapitalExpenditures in excess of $2,000,000.”

 

2.             Representations and Warranties. In order to induce the Bank to agree to the amendment described in Section 1of this Amendment, the Borrower makes the following representations andwarranties, which shall survive the execution and delivery of this Amendment:

(a)           NoEvent of Default will exist immediately after giving effect to the amendmentcontained herein;

 

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(b)           Eachof the representations and warranties set forth in Section 7 of theLoan Agreement are true and correct as though such representations andwarranties were made at and as of the Amendment Effective Date, except to theextent that any such representations or warranties are made as of a specifieddate or with respect to a specified period of time, in which case suchrepresentations and warranties shall be made as of such specified date or withrespect to such specified period.  Eachof the representations and warranties made under the Loan Agreement shallsurvive to the extent provided therein and not be waived by the execution anddelivery of this Amendment;

 

(c)           TheBorrower is a duly organized, validly existing Delaware corporation and has thepower and authority to execute, deliver and carry out the terms and provisionsof this Amendment, and has taken or caused to be taken all necessary corporateaction to authorize the execution, delivery and performance of this Amendment;

 

(d)           Noconsent of any other Person or filing or action by any governmentalauthorities, is required to authorize the execution, delivery and performanceof this Amendment;

 

(e)           ThisAmendment has been duly executed by a duly authorized signatory on behalf ofthe Borrower and constitutes the legal, valid and binding obligation of theBorrower, enforceable in accordance with its terms, except as enforcementthereof may be subject to the effect of any applicable (i) bankruptcy,insolvency, reorganization, moratorium or similar law affecting creditors’rights generally and (ii) general principals of equity; and

 

(f)            The execution and delivery and performance of theagreements in this Amendment will not violate any law, statute or regulationapplicable to the Borrower or any order or decree of any governmentalauthorities, or conflict with or result in the breach or any contractualobligation of the Borrower.

 

3.             Conditions Precedent to Effectiveness ofthe Amendment.  This Amendment is subject to the satisfactionof (or waiver by the Bank in its sole discretion) the following conditionsprecedent:

 

(a)                           No Potential Event of Default or Event ofDefault under the Loan Agreement shall have occurred and be continuing;

 

(b)                           The Guarantors shall have executed anddelivered to the Bank a Reaffirmation of Guaranty Agreement in the formattached to this Amendment; and

 

(c)                           The Borrower shall have executed anddelivered such other documents and instruments that the Bank may reasonablyrequest to effect the purposes of this Amendment.

 

4.             Expenses.  The Borroweragrees to pay on demand all reasonable costs and expenses, including filing andrecording fees, incurred by the Bank in connection with the preparation,execution and delivery of this Amendment, and any other documents orinstruments which may be delivered in connection herewith, including withoutlimitation, the reasonable fees and expenses of legal counsel for the Bank.

 

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5.             Counterparts. This Amendment may be executed in counterparts and by different partieshereto in separate counterparts, each of which, when so executed and delivered,shall be deemed to be an original and all of which, when taken together, shallconstitute one and the same instrument. Faxed or emailed signatures of this Agreement shall be binding on theparties.  Each party shall promptly sendto the other party signed originals of faxed or emailed signatures to thisAgreement.

 

6.             Ratification. The Loan Agreement, as amended by this Amendment, is and shall continueto be in full force and effect and is hereby in all respects confirmed,approved and ratified.  Except as amendedor waived hereby, all terms and conditions of the Loan Agreement remain thesame.

 

7.             Release.  In consideration of the amendments providedherein, the Borrower releases and discharges the Bank, and its directors,officers, employees, agents, successors and assigns from all claims and causesof action of any nature whatsoever, which the Borrower, its successors andassigns ever had or have as of the date hereof against the Bank that arise,directly or indirectly, out of or are related to the Loan Agreement. TheBorrower acknowledges that the Obligations arising under the Loan Agreement arenot subject to any such counterclaim, offset, defense or rights of recoupmentagainst the Bank.

 

8.             Governing Law. The rights and duties of the Borrower and the Bank under this Amendmentshall be governed by the law of the State of Illinois.

 

9.             Reference to Loan Agreement. From and after the Amendment Effective Date, each reference in the LoanAgreement to “this Loan Agreement”, “hereof”, “hereunder” or words of likeimport, and all references to the Loan Agreement in any and all agreements,instruments, documents, notes, certificates and other writings of every kindand nature, shall be deemed to mean the Loan Agreement as modified and amendedby this Amendment.

 

**INWITNESS WHEREOF**, the parties have caused this Amendment to beduly executed by their authorized officers as of the date first written above.

 

**ISI SECURITY GROUP, INC.**

 

 
| By:                                    |   /s/  Donald F. Neville |   |
|----------------------------------------|------------------------------------|--------|
| Name:                                  | Donald F. Neville                  |
| Title:                                 | CFO                                |
|                                   |                               |
| **THE  PRIVATEBANK AND TRUST COMPANY** |
|                                   |                               |
|                                   |                               |
| By:                                    |   /s/  Nate Palmer       |   |
| Name:                                  | Nate Palmer                        |
| Title:                                 | Associated Managing  Director      |
|                                        |                                    |        |  |

 

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**REAFFIRMATION OF GUARANTY AGREEMENT**

 

The undersigned (a) acknowledgesreceipt of a copy of (i) Amendment No. 2 to Loan and SecurityAgreement, dated March 30, 2009, between ISI Security Group, Inc. andThe PrivateBank and Trust Company, (b) consents to such amendments andwaivers and all prior amendments and each of the transactions referencedtherein, and (c) hereby reaffirms its obligations under its UnconditionalContinuing Guaranty Agreement, dated as of October 3, 2008 in favor of ThePrivateBank and Trust Company.

 

Dated as of March 30,2009

 
| **DETENTION  CONTRACTING GROUP, LTD.,**    |                                  |
|--------------------------------------------|---------------------------------------|
| a Texas limited  partnership               |                                  |
|                                       |                                  |   |
| By:                                        | **ISI  DETENTION CONTRACTING**        |   |
| ** **                                 | **GROUP,  INC.,**a Texas corporation, |   |
|                                       | its general partner                   |   |
|                                       |                                  |   |
|                                       |                                  |   |
| By:                                        | /s/ Donald F. Neville                 |   |
| Name:                                      | Donald F. Neville                     |   |
| Title:                                     | CFO                                   |   |
|                                       |                                  |   |
| **ISI  DETENTION CONTRACTING**             |                                  |
| **GROUP,  INC**., a Texas corporation      |                                  |
|                                       |                                  |   |
|                                       |                                  |   |
| By:                                        | /s/ Donald F. Neville                 |   |
| Name:                                      | Donald F. Neville                     |   |
| Title:                                     | CFO                                   |   |
|                                       |                                  |   |
| **ISI  DETENTION CONTRACTING**             |                                  |
| **GROUP,  INC.,** a California corporation |                                  |
|                                       |                                  |   |
|                                       |                                  |   |
| By:                                        | /s/ Donald F. Neville                 |   |
| Name:                                      | Donald F. Neville                     |   |
| Title:                                     | CFO                                   |   |
|                                       |                                  |   |
| **ISI  DETENTION CONTRACTING**             |                                  |
| **GROUP,  INC.,** a New Mexico corporation |                                  |
|                                       |                                  |   |
|                                       |                                  |   |
| By:                                        | /s/ Donald F. Neville                 |   |
| Name:                                      | Donald F. Neville                     |   |
| Title:                                     | CFO                                   |   |
|                                       |                                  |   |
| **ISI  DETENTION SYSTEMS, INC.,**          |                                  |
| a Texas corporation                        |                                  |
|                                       |                                  |   |
|                                       |                                  |   |
| By:                                        | /s/ Donald F. Neville                 |   |
| Name:                                      | Donald F. Neville                     |   |
| Title:                                     | CFO                                   |   |

 

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| **ISI  SYSTEMS, LTD.,**                                         |                                      |
|-----------------------------------------------------------------|-------------------------------------------|
| a Texas limited  partnership                                    |                                      |
|                                                            |                                      |   |
|                                                            |                                      |   |
| By:                                                             | **ISI  DETENTION SYSTEMS, INC.,**         |   |
|                                                            | a Texas corporation,  its general partner |   |
|                                                            |                                      |   |
|                                                            |                                      |   |
| By:                                                             | /s/ Donald F. Neville                     |   |
| Name:                                                           | Donald F. Neville                         |   |
| Title:                                                          | CFO                                       |   |
|                                                            |                                      |   |
| **METROPLEX  CONTROL SYSTEMS, INC.,**                           |                                      |
| a Texas corporation,  (f/k/a ISI Metroplex Controls, Inc.) |                                      |
|                                                            |                                      |   |
|                                                            |                                      |   |
| By:                                                             | /s/ Donald F. Neville                     |   |
| Name:                                                           | Donald F. Neville                         |   |
| Title:                                                          | CFO                                       |   |
|                                                            |                                      |   |
| **ISI  CONTROLS, LTD**.,                                        |                                      |
| a Texas limited  partnership                                    |                                      |
|                                                            |                                      |   |
| By:                                                             | **METROPLEX  CONTROL SYSTEMS, INC.,**     |   |
|                                                            | a Texas corporation,  its general partner |   |
|                                                            |                                      |   |
|                                                            |                                      |   |
| By:                                                             | /s/ Donald F. Neville                     |   |
| Name:                                                           | Donald F. Neville                         |   |
| Title:                                                          | CFO                                       |   |
|                                                            |                                      |   |
| **METROPLEX  COMMERCIAL FIRE AND**                              |                                      |
| **SECURITY  ALARMS, INC.,**a Texas corporation                  |                                      |
|                                                            |                                      |   |
|                                                            |                                      |   |
| By:                                                             | /s/ Donald F. Neville                     |   |
| Name:                                                           | Donald F. Neville                         |   |
| Title:                                                          | CFO                                       |   |
|                                                            |                                      |   |
| **MCFSA,  LTD.,**                                               |                                      |
| a Texas limited partnership                                     |                                      |
|                                                            |                                      |   |
|                                                            |                                      |   |
| By:                                                             | **METROPLEX  COMMERCIAL FIRE AND**        |   |
| ** **                                                      | **SECURITY  ALARMS, INC.,** a Texas       |   |
|                                                            | corporation, its  general partner         |   |
|                                                            |                                      |   |
|                                                            |                                      |   |
| By:                                                             | /s/ Donald F. Neville                     |   |
| Name:                                                           | Donald F. Neville                         |   |
| Title:                                                          | CFO                                       |   |
|                                                            |                                      |   |
| **COM-TEC  SECURITY, LLC,**                                     |                                      |
| a Wisconsin limited  partnership                                |                                      |
|                                                            |                                      |   |
|                                                            |                                      |   |
| By:                                                             | /s/ Donald F. Neville                     |   |
| Name:                                                           | Donald F. Neville                         |   |
| Title:                                                          | CFO                                       |   |

 

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| **COM-TEC  CALIFORNIA LIMITED** |                  |
|---------------------------------|-----------------------|
| **PARTNERSHIP,**a Wisconsin     |                  |
| limited partnership             |                  |
|                            |                  |   |
|                            |                  |   |
| By:                             | /s/ Donald F. Neville |   |
| Name:                           | Donald F. Neville     |   |
| Title:                          | CFO                   |   |

 

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**REAFFIRMATION OF GUARANTY AGREEMENT**

 

The undersigned (a) acknowledgesreceipt of a copy of (i) Amendment No. 2 to Loan and SecurityAgreement, dated March 30, 2009, between ISI Security Group, Inc. andThe PrivateBank and Trust Company, (b) consents to such amendments andwaivers and all prior amendments and each of the transactions referencedtherein, and (c) hereby reaffirms its obligations under its UnconditionalContinuing Guaranty Agreement, dated as of January 8, 2009 in favor of ThePrivateBank and Trust Company.

 

Dated as of March 30,2009

 
| **ARGYLE  SECURITY, INC.,**a Delaware corporation |                  |
|---------------------------------------------------|-----------------------|
|                                              |                  |   |
|                                              |                  |   |
| By:                                               | /s/ Donald F. Neville |   |
| Name:                                             | Donald F. Neville     |   |
| Title:                                            | CFO                   |   |

 

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