Exhibit 4.2

                               FOURTH AMENDMENT TO
                                 LOAN AGREEMENT


THIS FOURTH  AMENDMENT  (this  "Amendment")  is entered into as of May 25, 1999,
among  Effective  Management  systems,  Inc.  (EMS"),  a Wisconsin  corporation,
EMS-East, Inc. ("EMS-East"),  a Massachusetts corporation,  Effective Management
Systems,  of Illinois,  Inc.  ("EMS-Illinois"),  an Illinois  corporation  (EMS,
EMS-East and EMS-Illinois are each  individually a "Borrower",  and collectively
"Borrowers"), and Foothill Capital Corporation ("Lender").

       WHEREAS,  Borrowers  and  Lender  are  parties  to a  Loan  and  Security
Agreement dated as of December 30, 1997 (the "Loan Agreement");

       WHEREAS,  Borrowers have requested that Lender amend the Loan  Agreement,
and Lender has  agreed to do so  subject to the terms and  conditions  contained
herein;

       NOW THEREFORE,  in  consideration  of the premises and mutual  agreements
herein contained, the parties hereto agree as follows:

       1. Defined Terms. Unless otherwise defined herein, capitalized terms used
herein shall have the meanings ascribed to such terms in the Loan Agreement.

       2.  Amendments  to Loan  Agreement.  Subject to the  satisfaction  of the
conditions  set forth in  Section 5 hereof,  the Loan  Agreement  is  amended as
follows:

       (a) The  definition  of Maximum  Amount"  set forth in Section 1.1 of the
Loan Agreement is hereby amended and restated as follows:

              "Maximum Amount" means, as of any date of  determination,  the sum
       of (a)  the  Maximum  Revolving  Amount  and  (b)  the  then  outstanding
       principal  balance of the Term  Loan;  provided,  that  during the period
       commencing  May 25, 1999 and ending  July 31,  1999,  the Maximum  Amount
       shall not exceed $9,500,000.

       (b) The definition of "Maximum Revolving Amount" set forth in Section 1.1
of the Loan Agreement is hereby amended and restated as follows:

              "Maximum  Revolving Amount" means (a) $7,000,000 during the period
       commencing  May 25, 1999 and ending July 31, 1999 and (b)  $5,000,000  at
       all times on and after August 1, 1999.
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       (c) Section  2.1(a) of the Loan  Agreement is hereby amended and restated
in its entirety, as follows:

       (a)  Subject  to the terms and  conditions  of this  Agreement,  Foothill
agrees to make advances  ("Advances") to Borrowers in an amount  outstanding not
to exceed at any one time the lesser of (i) the  Maximum  Revolving  Amount less
the  outstanding  balance of all undrawn or unreimbursed  Letters of Credit,  or
(ii) the  Borrowing  Base  less  (A) the  aggregate  amount  of all  undrawn  or
unreimbursed  Letters of Credit.  For  purposes  of this  Agreement,  "Borrowing
Base", as of any date of determination, shall mean the result of:

              (x) the lesser of (I) 80% of Eligible Accounts of Borrowers,  less
       the amount, if any, of the Dilution Reserve,  and (ii) an amount equal to
       Borrowers'  Collections  with  respect to Accounts of  Borrowers  for the
       immediately  preceding 100 day period (provided,  that such period may be
       adjusted for seasonality in Foothill's reasonable credit judgment), minus

              (y) the  aggregate  amount of  reserves,  if any,  established  by
       Foothill under Section 2.1(b), plus

              (z) the " Additional  Availability Amount" (as defined below). The
       "Additional  Availability  Amount" means (i) during the period commencing
       on May 25, 1999 and ending on July 31,  1999 an amount  equal to $750,000
       and (ii) at all  times on and after  August  1,  1999 an amount  equal to
       zero.

       (d) Section  2.1(c) of the Loan  Agreement is hereby amended and restated
in its entirety as follows:

       (c) Foothill  shall have no obligation to make Advances  hereunder to the
extent they would cause (i) the  outstanding  Obligations  (other than under the
Term  Loan) to exceed  the  Maximum  Revolving  Amount  or (ii) the  outstanding
Obligations to exceed the Maximum Amount.

       3.  Ratification.   This  Amendment,   subject  to  satisfaction  of  the
conditions provided below, shall constitute amendments to the Loan Agreement and
all of the Loan Documents as  appropriate  to express the  agreements  contained
herein.  In all other respects,  the Loan Agreement and the Loan Documents shall
remain  unchanged and in full force and effect in accordance with their original
terms.

       4.  Conditions  to  Effectiveness.   Subject  to  Section  6  below,  the
amendments  to the Loan  Agreement  set  forth in this  Amendment  shall  become
effective  as of the date of this  Amendment  and upon the  satisfaction  of the
following conditions precedent in form and substance satisfactory to Lender:
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       (a)  Modification  Fee.  Borrower shall pay to Lender a modification  fee
equal to Twenty Thousand Dollars ($20,000).

       (b) No Default.  No Event of Default or event  which,  with the giving of
notice or the passage of time, or both, would become an Event of Default,  shall
have occurred and be  continuing,  and,  after giving  effect to the  amendments
contained  herein, no Event of Default or event which, with the giving of notice
or the passage of time,  or both,  would become an Event of Default,  shall have
occurred and be continuing.

       5. Miscellaneous.

       (a)  Warranties  and Absence of  Defaults.  In order to induce  Lender to
enter into this Amendment,  each Borrower  hereby warrants to Lender,  as of the
date hereof, that:

       (i) The warranties of such Borrower  contained in the Loan Agreement,  as
herein  amended,  are true and  correct as of the date  hereof as if made on the
date hereof.

       (ii) All  information,  reports  and  other  papers  and data  heretofore
furnished to Lender by such Borrower in connection with this Amendment, the Loan
Agreement and the other Loan  Documents are accurate and correct in all material
respects  and  complete  insofar as may be  necessary  to give  Lender  true and
accurate knowledge of the subject matter thereof. Such Borrower has disclosed to
Lender  every fact of which it is aware  which would  reasonably  be expected to
materially and adversely affect the business,  operations or financial condition
of such  Borrower  or the ability of such  Borrower  to perform its  obligations
under  this  Amendment,  the Loan  Agreement  or  under  any of the  other  Loan
Documents.  None of the information  furnished to Lender by or on behalf of such
Borrower  contained  any  material  misstatement  of fact or  omitted to state a
material fact or any fact necessary to make the statements  contained  herein or
therein not materially misleading.

         (iii) No Event of Default or event which,  with giving of notice or the
passage of time, or both would become an Event of Default, exists as of the date
hereof.



<PAGE>




       (b) Expenses.  Borrowers agree to pay on demand all costs and expenses of
Lender  (including  the  reasonable  fees and  expenses  of outside  counsel for
Lender) in connection with the preparation, negotiation, execution, delivery and
administration of this Amendment and all other instruments or documents provided
for herein or delivered or to be delivered hereunder or in connection  herewith.
In addition, Borrowers agree to pay, and save Lender harmless from all liability
for,  any stamp or other  taxes  which may be  payable  in  connection  with the
execution  or  delivery  of this  Amendment  or the Loan  Agreement,  as amended
hereby,  and the execution and delivery of any instruments or documents provided
for herein or delivered or to be delivered hereunder or in connection  herewith.
All obligations  provided in this Section 6 (b) shall survive any termination of
this Amendment and the Loan Agreement as amended hereby.

       (c)  Governing  Law.  This  Amendment  shall be a contract made under and
governed by the internal laws of the State of California.

       (d)  Counterparts.  This  Amendment  may be  executed  in any  number  of
counterparts,  and by the parties  hereto on the same or separate  counterparts,
and each such counterpart, when executed and delivered, shall be deemed to be an
original,  but all such counterparts  shall together  constitute but one and the
same Amendment.

       (e) Reference to Loan Agreement.  On and after the  effectiveness  of the
amendment to the Loan Agreement  accomplished hereby, each reference in the Loan
Agreement to "this Agreement,"  "hereunder," "hereof," "herein" or words of like
import, and each reference to the Loan Agreement in any Loan Documents, or other
agreements,  documents or other instruments  executed and delivered  pursuant to
the Loan  Agreement,  shall mean and be a reference  to the Loan  Agreement,  as
amended by this Amendment.

       (f) Successors.  This Amendment  shall be binding upon Borrowers,  Lender
and their respective  successors and assigns,  and shall inure to the benefit of
Borrowers, Lender and their respective successors and assigns.


<PAGE>





       IN WITNESS  WHEREOF,  the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized and delivered as
of the date first above written.



                          EFFECTIVE MANAGEMENT SYSTEMS,
                          INC.,
                          a Wisconsin corporation

                                 By
                                     -------------------------------------------
                                     -------------------------------------------
                              Title  President
                                     -------------------------------------------



                          EMS-EAST, Inc., a Massachusetts corporation

                                 By
                                     -------------------------------------------
                                     -------------------------------------------
                              Title  Treasurer
                                     -------------------------------------------



                          EFFECTIVE MANAGEMENT SYSTEMS OF
                          ILLINOIS, an Illinois corporation

                                 By
                                     -------------------------------------------
                                     -------------------------------------------
                              Title  Secretary
                                     -------------------------------------------



                          FOOTHILL CAPITAL CORPORATION,
                          a California corporation

                              By
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                                  ----------------------------------------------
                              Title Vice President
                                  ----------------------------------------------