AMENDMENT #2 TO THE THIRD RESTATED AND AMENDED LOAN AND SECURITY AGREEMENT

November 23, 2004




JACO ELECTRONICS, INC. ("Jaco")
145 Oser Avenue
Hauppauge, NY  11778

NEXUS CUSTOM ELECTRONICS, INC. ("Nexus")
Prospect Street
Brandon, VT  05733

INTERFACE ELECTRONICS CORP. ("Interface")
124 Grove Street
Franklin, MA  02028

Gentlemen:

         Reference is made to the Third Restated and Amended Loan and Security
Agreement in effect between GMAC Commercial Finance LLC, as successor by merger
to GMAC Commercial Credit LLC, which was the successor in interest to BNY
Financial Corporation ("GMAC"), as Agent and Lender, and PNC Bank, National
Association ("PNC") as Lender and Co-Agent, and Jaco, Nexus and Interface, dated
December 22, 2003, as supplemented and amended from time to time, (the
"Agreement"). Reference is also made to Amendment #1, to the Agreement, dated
September 20, 2004 (the "Amendment"). Both GMAC and PNC may hereinafter be
referred to jointly as the "Lenders", and individually, as a "Lender" and GMAC
may also be herein referred to as "Agent" when acting in such capacity, as the
case may be and PNC may also herein be referred as "Co-Agent", as the case may
be. Initially capitalized terms not defined herein shall have the meanings
ascribed to such terms in the Agreement. Jaco, Nexus and Interface may
hereinafter and in the Agreement, be referred to jointly and severally as
"Debtors", and each individually as a "Debtor".

         It is hereby agreed, among the parties to the Agreement, that the
Agreement and the Amendment are hereby amended effective as of the date hereof,
as follows:

1. The definition of "EBITDA" appearing in Section 1.2., of the Agreement,


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is hereby deleted, in its entirety, and replaced by the following definition:

                                    " "EBITDA" shall mean (i) for any period
                                    ending prior to October 1, 2004, earnings
                                    before interest, taxes, depreciation and
                                    amortization and (ii) for any period
                                    commencing on or after October 1, 2004,
                                    earnings minus any extraordinary gains,
                                    including any gains derived from the sale of
                                    assets of Nexus, before interest, taxes,
                                    depreciation and amortization."

               2.   The definition of "Fixed Charge Coverage Ratio" appearing in
                    Section 1.2., of the Agreement,  is hereby  deleted,  in its
                    entirety, and replaced by the following definition:

                                    " "Fixed Charge Coverage Ratio" shall mean,
                                    during any period, the ratio of (y) EBITDA
                                    (minus any extraordinary gains, including
                                    any gains derived from the sale of the
                                    assets of Nexus, for any period ending prior
                                    to October 1, 2004) minus unfunded Capital
                                    Expenditures, to (x) the sum of (i)
                                    interest, (ii) term debt repayments and
                                    other repayments of Indebtedness (other than
                                    Obligations under this Agreement), (iii)
                                    taxes due for such period, and (iv) required
                                    reductions of the Additional Availability
                                    Amount during such period."

               3.   Section  6.12. of the  Agreement is hereby  deleted,  in its
                    entirety, and replaced by the following Section 6.12.:

                                    "6.12. Permanent Undrawn Availability .

                                           Maintain at all times (for all Loan
                                           Parties) an aggregate Undrawn
                                           Availability of $1, 500,000, provided
                                           however, that such Undrawn
                                           Availability may be reduced to $500,
                                           000 at all times on the later to
                                           occur of (i) 3-31-05 or (ii) the last
                                           day of the second consecutive fiscal
                                           quarter during which the Fixed Charge
                                           Coverage Ratio equals 1.1 to 1.0,
                                           calculated on a rolling four quarter
                                           basis."

               4.   By their signatures below,  Jaco, Nexus and Interface hereby
                    ratify the  Agreement  (as hereby  amended)  and agree to be
                    jointly and severally  liable for all Obligations  under the
                    Agreement and agree that all of the  outstanding  amounts of
                    the Loans under the Agreement,  as of the date hereof, shall
                    be valid and binding  Obligations of each of them, and shall
                    be deemed Obligations  outstanding under the Agreement,  and
                    hereby  agree and  promise  to repay to the  Agent,  for the
                    benefit of the Lenders, such Obligations  (including but not

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                    limited to all applicable  interest) in accordance  with the
                    terms of the  Agreement,  but in no  event,  later  than the
                    Termination Date.

               5.   By their signatures below,  Jaco, Nexus and Interface hereby
                    ratify  and affirm to the Agent and the  Lenders  that as of
                    the  date  hereof,  they  are in full  compliance  with  all
                    covenants under the Agreement (except as waived above),  and
                    certify (i) that all  representations  and warranties of the
                    Agreement are true and accurate as of the date hereof,  with
                    the same  effect  as if they  had  been  made as of the date
                    hereof, (ii) no Default or Event of Default has occurred and
                    is continuing, or would result from the execution,  delivery
                    and  performance  by  Debtors,  of  this  Amendment  or  the
                    Agreement  (as  amended  by  this   Amendment),   except  as
                    specifically  waived  herein;  (iii)  each  Debtor  has full
                    power,  right and legal  authority  to execute,  deliver and
                    perform  its  obligations  under this  Amendment;  (iv) each
                    Debtor  has taken all  action  necessary  to  authorize  the
                    execution  and  delivery  of,  and  the  performance  of its
                    obligations  under this  Amendment;  and (v) this  Amendment
                    constitutes  a legal,  valid and binding  obligation of each
                    Debtor  enforceable  against such Debtor in accordance  with
                    its  terms,  and does not  constitute  a breach of any other
                    agreement or  understanding  to which such Debtor is a party
                    or by which its property is bound.

         Except as herein specifically amended, the Agreement shall remain in
full force and effect in accordance with its original terms, except as
previously amended.

         If the foregoing accurately reflects our understanding, kindly sign the
enclosed copy of this letter and return it to our office as soon as practicable.

                                               Very truly yours,
                                               GMAC COMMERCIAL FINANCE LLC
                                               (as Agent and Lender)

                                               By:/s/ Daniel Murray
                                                     --------------------
                                              Title:   1st VP

AGREED AND ACCEPTED:
JACO ELECTRONICS, INC.              PNC BANK NATIONAL ASSOCIATION
                                   (as Lender)

By:/s/ Jeffrey D, Gash              By: /s/ Wing Louie
     ----------------------                ------------------
Title: CFO                          Title: VP


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NEXUS CUSTOM ELECTRONICS, INC.      INTERFACE ELECTRONICS CORP.

By:/s/ Jeffrey D, Gash              By:/s/ Jeffrey D, Gash
     ----------------------              ----------------------
Title: CFO                          Title: CFO