Document:

<PAGE>

                                                               EXHIBIT NO. 10.15

                                FOURTH AMENDMENT

               FOURTH AMENDMENT (this "Amendment"), dated as of July 19, 2002,
among PENHALL INTERNATIONAL CORP., an Arizona corporation (the "Borrower"), the
lending institutions party to the Credit Agreement referred to below (each a
"Bank" and, collectively, the "Banks") and DEUTSCHE BANK TRUST COMPANY AMERICAS
(f/k/a BANKERS TRUST COMPANY) as administrative agent (the "Administrative
Agent"). All capitalized terms used herein and not otherwise defined shall have
the respective meanings provided such terms in the Credit Agreement referred to
below.

                              W I T N E S S E T H :

               WHEREAS, the Borrower, the Banks, Credit Suisse First Boston and
the Administrative Agent are parties to a Credit Agreement, dated as of August
4, 1998 (as amended, modified or supplemented through the date hereof, the
"Credit Agreement");

               WHEREAS, the parties hereto wish to amend certain provisions of
the Credit Agreement as herein provided, subject to and on the terms and
conditions set forth herein;

               NOW, THEREFORE, it is agreed:

               1. Section 2.01(b) of the Credit Agreement is hereby amended by
deleting the text "15,000,000" appearing therein and inserting the text
"$20,000,000" in lieu thereof.

               2. Section 8.10 of the Credit Agreement is hereby amended by
deleting the table contained therein in its entirety and inserting the following
table in lieu thereof:

<TABLE>
<CAPTION>
                  "Date                                            Ratio
                  -----                                            -----
               <S>                                               <C>
               June 30, 2002                                     2.00:1.00

               September  30, 2002                               1.80:1.00

               December 31, 2002                                 1.80:1.00

               March 31, 2003                                    1.80:1.00

               June 30, 2003                                     1.80:1.00

               September 30, 2003                                1.85:1.00

               December 31, 2003                                 1.85:1.00

               March 31, 2004                                    1.90:1.00

               June 30, 2004                                     1.95:1.00"
</TABLE>

               3. Section 8.11 of the Credit Agreement is hereby amended by
deleting the table contained therein in its entirety and inserting the following
table in lieu thereof:

<TABLE>
<CAPTION>
                  "Date                                            Ratio
                  -----                                            -----
               <S>                                               <C>
               June 30, 2002                                     5.00:1.00

</TABLE>
               September  30, 2002                               5.35:1.00

<PAGE>

<TABLE>
               <S>                                               <C>
               December 31, 2002                                 5.35:1.00

               March 31, 2003                                    5.25:1.00

               June 30, 2003                                     5.20:1.00

               September 30, 2003                                5.10:1.00

               December 31, 2003                                 5.00:1.00

               March 31, 2004                                    4.95:1.00

               June 30, 2004                                     4.85:1.00"
</TABLE>

               4. Section 8.14 of the Credit Agreement is hereby amended by
deleting the table contained therein in its entirety and inserting the following
table in lieu thereof:

<TABLE>
<CAPTION>
                  "Date                                            Amount
                  -----                                          -----------
               <S>                                               <C>
               June 30, 2002                                     $28,000,000

               September 30, 2002                                $25,200,000

               December 31, 2002                                 $25,200,000

               March 31, 2003                                    $25,600,000

               June 30, 2003                                     $25,600,000

               September 30, 2003                                $27,100,000

               December 31, 2003                                 $27,100,000

               March 31, 2004                                    $28,100,000

               June 30, 2004                                     $28,100,000"
</TABLE>

               5. Section 10 of the Credit Agreement is hereby amended by
deleting the table appearing in the definition of `Applicable Margin' in its
entirety and inserting the following table in lieu thereof:

<TABLE>
<CAPTION>
                                        "Base Rate                Eurodollar
                                           Loans                  Rate Loans
                                        ----------                ----------
               <S>                      <C>                       <C>
               Level I Status              1.25%                     2.25%

               Level II Status             1.50%                     2.50%

               Level III Status            1.75%                     2.75%

               Level IV Status             2.00%                     3.00%"
</TABLE>

               6. In order to induce the Banks to enter into this Amendment, the
Borrower hereby represents and warrants that (i) the representations, warranties
and agreements contained in Section 6 of the Credit Agreement and in the other
Credit Documents are true and correct in all material respects on and as of the
Fourth Amendment Effective Date (as defined in Section 12 of this Amendment) (it
being understood and agreed that any representation or warranty which by its
terms is made as of a specified date shall be required to be true and correct in
all material respects only as of such specified date) and (ii) there exists no
Default or Event of Default on the Fourth Amendment Effective Date.

               7. For avoidance of doubt, each Credit Party hereby acknowledges
and confirms its due authorization, execution and delivery of all Credit
Documents to which it is a party (each Credit Document as amended, modified or
supplemented through and including the date hereof), including all instruments,
financing statements, agreements, certificates and documents executed and
delivered in connection therewith, and hereby ratifies all actions heretofore
taken in connection therewith.

                                      -2-
<PAGE>

               8. Each Credit Party, by its execution and delivery of a copy of
this Amendment, hereby consents to the extensions of credit pursuant to the
Credit Agreement (including, without limitation, as amended by this Amendment).
Each Credit Party further acknowledges and agrees to the provisions of this
Amendment and hereby agrees for the benefit of the Banks that all extensions of
credit (including as contemplated by this Amendment) pursuant to the Credit
Agreement (including, without limitation, as amended by this Amendment, and as
same may be further amended, modified or supplemented from time to time) shall
be fully entitled to all benefits of, and shall be fully guaranteed and secured
pursuant to and in accordance with the terms of, each of the Credit Documents,
as applicable.

               9. This Amendment is limited as specified and shall not
constitute a modification, acceptance or waiver of any other provision of the
Credit Agreement or any other Credit Document.

               10. This Amendment may be executed in any number of counterparts
and by the different parties hereto on separate counterparts, each of which
counterparts when executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A complete set of
counterparts shall be lodged with the Borrower, the Administrative Agent and
each Bank.

               11. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE
STATE OF NEW YORK.

               12. This Amendment shall become effective on the date (the
"Fourth Amendment Effective Date") when (i) the Borrower and each of the Banks
shall have signed a counterpart hereof (whether the same or different
counterparts) and shall have delivered (including by way of facsimile
transmission) the same to the Administrative Agent at its address for notice
provided for in the Credit Agreement and (ii) the Borrower shall have paid all
reasonable out-of-pocket costs and expenses of the Banks incurred prior to the
Fourth Amendment Effective Date (including, without limitation, the fees and
disbursements of White & Case LLP) and (iii) the Borrower shall have paid to the
Administrative Agent for the account of each Bank which executes and delivers a
counterpart hereof (including by way of facsimile transmission) to the
Administrative Agent at the Notice Office on or prior to 5:00 P.M. (New York
time) on July 19, 2002, an amendment fee equal to 0.25% of the sum of (a) the
aggregate principal amount of each such Bank's outstanding Term Loans plus (b)
such Bank's Revolving Loan Commitment as of the Fourth Amendment Effective Date.

                                      * * *

                                      -3-
<PAGE>

               IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Amendment to be duly executed and delivered as of the date
first above written.

1801 Penhall Way                        PENHALL INTERNATIONAL CORP.,
PO Box 4609                             as Borrower
Anaheim, CA 92803
Attention: Jeff Platt
Tel:  (714) 772-6450
Fax:  (714) 778-8437                    By _____________________________________
                                           Title:

                                        PENHALL LEASING LLC,
                                        as Guarantor

                                        By _____________________________________
                                           Title:

                                        PENHALL INVESTMENTS, INC,
                                        as Guarantor

                                        By _____________________________________
                                           Title:

                                        PENHALL COMPANY,
                                        as Guarantor

                                        By _____________________________________
                                           Title:

<PAGE>

                                        DEUTSCHE BANK TRUST COMPANY AMERICAS
                                        (f/k/a BANKERS TRUST COMPANY)
                                        Individually and as Administrative Agent

                                        By _____________________________________
                                           Title:

<PAGE>

                                        CREDIT SUISSE FIRST BOSTON
                                        Individually and as Syndication Agent

                                        By _____________________________________
                                           Title:

<PAGE>

                                        FLEET CAPITAL CORPORATION

                                        By _____________________________________
                                           Title:

<PAGE>

                                        UNION BANK OF CALIFORNIA, N.A.

                                        By _____________________________________
                                           Title:

<PAGE>

                                        U.S. BANK NATIONAL ASSOCIATION

                                        By _____________________________________
                                           Title:<PAGE>
                                                                   EXHIBIT 10.20

BANC OF AMERICA LEASING & CAPITAL, LLC

                                                     NOTE AND SECURITY AGREEMENT
                                                     (VARIABLE RATE, LIBOR)
================================================================================

This Note and Security Agreement ("Agreement") made as of the date set forth
below sets forth the terms and conditions governing the repayment of a loan made
by Banc of America Leasing & Capital, LLC ("Secured Party") to the party
identified below as "Debtor" for the purpose of financing the personal property
identified below as the "Equipment", and the granting by Debtor to Secured Party
of a security interest in the Equipment and certain related property to secure
the repayment of all Debtor's obligations to Secured Party.

<TABLE>
<S>                                                                     <C>                   <C>
DATE:   MARCH 18, 2002                                                  AGREEMENT NUMBER:     02973-00701

SECURED PARTY:         Banc of America Leasing & Capital, LLC
                       2059 Northlake Parkway, 4 South
                       Tucker, Georgia  30084-4007

DEBTOR:                Penhall Company

Equipment:             See Exhibit A attached hereto and made a part hereof

EQUIPMENT LOCATION:    See Exhibit B attached hereto and made a part hereof
</TABLE>

PRINCIPAL AMOUNT OF LOAN: TWO MILLION EIGHT HUNDRED SIX THOUSAND THREE HUNDRED
NINE AND 14/100 DOLLARS ($2,806,309.14)

NUMBER OF PRINCIPAL REPAYMENT INSTALLMENTS (INCLUDING FINAL REPAYMENT
INSTALLMENT):  FIFTY-ONE (51)

AMOUNT OF EACH PRINCIPAL REPAYMENT INSTALLMENT PRIOR TO FINAL REPAYMENT
INSTALLMENT:   SEE ANNEX I ATTACHED HERETO AND MADE A PART HEREOF.

AMOUNT OF FINAL PRINCIPAL REPAYMENT INSTALLMENT: SEE ANNEX I ATTACHED HERETO AND
MADE A PART HEREOF.

DUE DATE OF FIRST PRINCIPAL REPAYMENT INSTALLMENT: THE THIRTIETH (30TH) DAY
FOLLOWING THE DATE SECURED PARTY FUNDS THIS LOAN.

DUE DATE OF FINAL PRINCIPAL REPAYMENT INSTALLMENT: the fifty first (51st) month
following, and on the same day of the month as, the Due Date of the First
Principal Repayment Installment

VARIABLE INTEREST RATE. For any year or portion thereof, a per annum rate of
interest equal to (i) Two and 60/100 percent (2.60%) plus the rate of interest
equal to the "average of interbank offered rates for dollar deposits in the
London Market based on quotations of sixteen (16) major banks" for a term of 30
days as published in the Wall Street Journal under a heading entitled "Money
Rates, London Interbank Offered Rates (LIBOR)" or any future or substitute
heading, on the first day of the month preceding the month in which a monthly
anniversary of the date Secured Party funds this Loan occurs, or (ii) if less,
the highest rate of interest permitted by applicable law.

LOAN; TERMS OF REPAYMENT. In consideration of the making of a loan by Secured
Party to Debtor for the purpose of financing the Equipment specified above (the
"Loan"), Debtor promises and agrees to pay to the order of Secured Party, at
Secured Party's address stated above or at such other places as Secured Party
may from time to time designate in writing, the principal amount of the Loan,
together with interest calculated as hereinafter provided. Subject to Debtor's
right to prepay such principal amount in whole or in part as hereinafter
provided, Debtor shall pay such principal amount in consecutive monthly
installments of principal, each in the amount set forth above under the heading
"Amount of Each Principal Repayment Installment Prior to Final Repayment
Installment," due and payable on the "Due Date of First Principal Repayment
Installment" set forth above and on a like date of each calendar month
thereafter until the Loan is fully repaid; provided, however, that the last such
installment shall be in the amount set forth above under the heading "Amount of
Final Principal Repayment Installment" or (if greater) the amount of the then
outstanding principal balance of the Loan.

INTEREST. Interest shall be calculated on the basis of a year of three hundred
sixty (360) days and shall, during each calendar month or portion thereof from
and after the date on which funds are disburse by Secured Party, accrue on
unmatured principal balances outstanding during such period at the "Variable
Interest Rate" specified above for the week in which the first day of the month
prior to such calendar month occurs. All interest accrued through the due date
of a principal installment shall be due and payable simultaneously with such
installment.

PREPAYMENTS. After one (1) month from the date Secured Party funds this Loan,
the outstanding principal balance of the Loan may be prepaid in whole or in part
at any time, together with all interest and late charges accrued through the
date of prepayment and a prepayment charge calculated as follows: two percent
(2%) of the amount prepaid during months 2-12 of the applicable Base Term, one
and one-half percent (1.5%) of the amount prepaid during months 13-24 of the
applicable Base Term, one percent (1%) of the amount prepaid during months 25-36
of the applicable Base Term, and no prepayment charge thereafter.
<PAGE>

LATE CHARGES. To the extent permitted by applicable law, Debtor shall pay on
demand, as a late charge, an amount equal to five percent (5%) of each
installment or part thereof that is not paid within ten (10) days of the date
when due, but nothing in this paragraph alters the definitions of events of
default hereunder. Debtor shall pay the late charge, to the extent permitted by
applicable law, regardless of whether or not Debtor's failure to pay such
installment when due is or becomes a default hereunder and regardless of whether
or not Secured Party proceeds under the "Remedies" provisions hereof or takes
any other action, and demand for and collection of the late charge shall not be
deemed a waiver of default or of any other remedies or rights.

SECURITY INTEREST. Debtor hereby grants to Secured Party a security interest in
and security title to the personal property described above as the "Equipment",
together with all parts, additions, accessions, accessories, replacements and
substitutions thereto or therefor, and all proceeds therefrom (including any
proceeds of insurance against fire or other casualty whether or not the
insurance policy contains an endorsement in favor of Secured Party), all of
which is hereinafter called the "Collateral". This security interest is given to
secure payment to Secured Party of all present and future obligations of Debtor
to Secured Party, including without limitation the obligation of Debtor to repay
the Loan and all other liabilities arising under or in connection with this
Agreement; all future advances, if any, made by Secured Party to Debtor, whether
or not made pursuant to any commitment of Secured Party (and nothing in this
Agreement shall be construed to create or imply the existence of any such
commitment); and all other liabilities of Debtor to Secured Party now existing
or hereafter incurred, matured or unmatured, direct or contingent, whether or
not evidenced by a promissory note, and whether owing originally to Secured
Party or acquired by Secured Party from any other party, and any renewals and
extension thereof and substitutions therefor. (All of the above obligations,
including but not limited to obligations in respect of the Loan, are hereinafter
called the "Indebtedness.")

DEBTOR WARRANTS AND REPRESENTS THAT:

GOOD STANDING. Debtor is organized and existing in good standing under the laws
of the jurisdiction of its formation, has the power to own its property and to
carry on its business as now being conducted, and is duly qualified to do
business and is in good standing in each jurisdiction in which the character of
the property owned by it therein or the transaction of its business makes such
qualification necessary.

AUTHORITY. Debtor has full power and authority to enter into this Agreement, to
make the borrowing hereunder, and to incur the obligations provided for herein,
all of which have been duly authorized by all proper and necessary action. No
consent or approval of stockholders, partners, members or co-owners or of any
public authority is required as a condition to the validity of this Agreement.

Debtor represents and warrants to Secured Party that all Collateral financed and
to be financed under this Agreement or any agreement shall be equipment operated
exclusively by Debtor's or Debtor's affiliate's employees and shall remain under
Debtors's or such affiliate's ownership and control at all times,
notwithstanding any temporary location of the Collateral at Debtor's customer's
site.

Debtor represents and warrants to Secured Party that by entering into this
Agreement and upon the execution of each agreement, there will be no violation
of the terms and conditions of (i) the Credit Agreement among Penhall
International Corp., Penhall Acquisition Corp., Bankers Trust Company, Credit
Suisse First Boston, Fleet Capital Corporation and Union Bank of California
dated as of August 4, 1998, as amended from time to time, or (ii) the Senior
Note Indenture between Penhall Acquisition Corp. and United States Trust Company
as Trustee dated as of August 1, 1998.

BINDING AGREEMENT. This Agreement constitutes the valid and legally binding
obligation of Debtor enforceable in accordance with its terms.

LITIGATION. There are no proceedings pending or threatened before any court or
administrative agency that might materially adversely affect the financial
condition or operation of Debtor.

NO CONFLICTING AGREEMENTS. There is no charter, by-law, preference stock or
partnership agreement provision of Debtor and no provision of any other
organizational documents or existing mortgage, indenture, contract or agreement
binding on Debtor or affecting its property which would conflict with or in any
way prevent the execution, delivery or performance of the terms of this
Agreement.

OWNERSHIP FREE OF ENCUMBRANCES. Except for the security interest granted hereby,
Debtor now owns, or will use the proceeds hereof to become the owner of, the
Collateral free from any prior lien, security interest or encumbrance. No
financing statement covering the Collateral or any proceeds thereof is on file
in any public office, except for financing statements showing Secured Party as
the sole secured party thereunder. Debtor has a good right to grant a security
interest in the Collateral to Secured Party.

FIXTURES. None of the Collateral is now a part of or affixed to any real
property.

COLLATERAL LOCATION. Except for items of Collateral that constitute mobile goods
and that are in fact in use by Debtor in the ordinary course of its business at
other locations, all the Collateral comprising goods heretofore delivered to the
Debtor by the seller thereof is located either at (i) Debtor's address set forth
above or (ii) the "Equipment Location" set forth above. If at any time the
Collateral, or any part thereof, is removed to a new location, Debtor shall
notify the Secured Party in the manner outlined in the section below entitled
"Location of Collateral".

MERGER/NAME CHANGE. Within the five (5) years preceding the date hereof, Debtor
has not changed its name or been party to any merger or other corporate
reorganization.

DEBTOR COVENANTS AND AGREES THAT UNTIL ALL THE INDEBTEDNESS IS FULLY SATISFIED:

INSURANCE. Debtor shall maintain continuously, and pay when due all premiums
for, fire and casualty insurance with extended coverage on the Collateral,
insuring the same against loss by fire, explosion, theft and such other
casualties as are usually insured against by companies engaged in the same or
similar businesses with a responsible company or companies satisfactory to
Secured Party, in an amount not less than the unpaid balance of the Loan. Each
of such insurance policies shall have attached thereto a standard loss payable
endorsement, without contribution, in favor of Secured Party as its interest may
appear; shall provide that it may not be

<PAGE>

canceled without thirty (30) days' prior written notice to Secured Party; shall
provide that, in respect of Secured Party's interest in such policy, the
insurance shall not be invalidated by any action or inaction of Debtor or any
other person (other than Secured Party); shall insure Secured Party's interest
in the Collateral as it may appear, regardless of any breach or violation of any
warranty, declaration or condition contained in such policy by Debtor or any
other person (other than Secured Party); and shall otherwise be in form and
substance acceptable to Secured Party. Debtor shall deliver forthwith to Secured
Party each such policy (together with the loss payable endorsement), or
certificates of insurance or other evidence satisfactory to Secured Party of the
existence of all required insurance, its terms and conditions, and the payment
of all applicable premiums. Similar evidence of renewal coverage, satisfactory
to Secured Party, shall be delivered to Secured Party at least fifteen (15) days
before the expiration of any initial insurance coverage. In addition, Debtor
shall maintain, and pay when due all premiums for, liability and other insurance
in such amounts and against such risks as is customarily carried by persons in
similar businesses owning similar property. Debtor irrevocably appoints Secured
Party as Debtor's attorney-in-fact, with full power of substitution, during the
existence of any default under this Agreement, to execute loss claims and other
applications for payment of benefits under any insurance policy in the name of
Debtor or Secured Party, to receive all monies and to endorse drafts, checks and
other instruments for the payment of any proceeds of any insurance. This
appointment shall be deemed a power coupled with an interest and shall not be
terminable by Debtor so long as Debtor remains indebted to Secured Party.

MAINTENANCE AND CLEAR TITLE. Debtor shall keep the Collateral in good condition
and free from liens and security interests, shall not sign or suffer to be filed
any financing statements relating to the Collateral except those showing Secured
Party as sole secured party shall not sell or lease or offer to sell or lease or
otherwise encumber or dispose of any of the Collateral, shall defend the
Collateral against all claims and demands of all persons at any time claiming
any interest or right therein, and shall not use the Collateral illegally.
Secured Party may examine and inspect the Collateral at any time, wherever
located.

CHANGE OF NAME, RESIDENCE OR PLACE OF BUSINESS. Debtor shall not change its
name, residence or place of business or do business under any assumed or
fictitious name without giving Secured Party written notice no later than thirty
(30) days after the change has occurred.

USE OF COLLATERAL. Debtor shall use the Collateral exclusively for business
operations.

INSPECTION: NON-INTERFERENCE. (a) Secured Party, its agents and employees shall
have the right to enter any property where any Collateral is located and inspect
any Collateral together with its related books and records, at any reasonable
time. Such right shall not impose any obligation on Secured Party.

FIXTURES. Debtor shall not permit any of the Collateral to become a part of or
affixed to any real property.

LOCATION OF COLLATERAL. Except for items of Collateral that constitute mobile
goods and that are in fact in use by Debtor in the ordinary course of business
at other locations, all the Collateral shall, from and after the moment that
Debtor acquires possession or control of it, be kept either at (i) Debtor's
address set forth above or (ii) the "Equipment Location" set forth above, and
all records relating to the Collateral shall likewise be kept only at such
location or locations. If at any time the Collateral, or any part thereof, is
removed to a new location, Debtor: (a) shall provide written notice thereof to
Secured Party within six (6) months after the funding of this Agreement and
every six (6) months thereafter until the end of the term; and (b) either (i)
the premises in which such Collateral will be installed will be owned by Debtor
free of any liens or encumbrances, or (ii) if not owned by Debtor free of liens
or encumbrances, the owner of such premises and/or the holder of any such liens
or encumbrances on such premises shall have consented and acknowledge the
superiority of Secured Party's interest in such Collateral.

INDEMNIFICATION. Debtor shall indemnify Secured Party against all claims arising
out of or connected with the ownership or use of the Collateral.

MOTOR VEHICLES. If the Collateral consists of or includes motor vehicles or
other equipment for which there is a certificate of title evidencing ownership
thereof, Debtor shall forthwith cause each certificate to be endorsed over and
the lien of Secured Party to be noted so as to show Secured Party's interest,
and Debtor shall deliver forthwith each such certificate to Secured Party.

TAXES. Debtor shall pay promptly when due all taxes, charges and assessments
that are or may become a lien on the Collateral or any part thereof, except to
the extent that the same are contested in good faith and by appropriate
proceedings.

FINANCIAL STATEMENTS.

(a) During the term of this Agreement, Debtor shall (i) maintain books and
records in accordance with generally accepted accounting principles ("GAAP") and
prudent business practice, (ii) promptly and in no event later than 120 days
after each fiscal year end furnish Secured Party annual audited consolidated and
consolidating financial statements of Penhall International Corp. and
subsidiaries, prepared in accordance with GAAP consistently applied, together
with an unqualified opinion of an independent auditor, and (iii) at Secured
Party's request, furnish Secured Party all other financial quarterly or other
interim financial statements of Debtor and of any Guarantor. Debtor shall
furnish such other information as Secured Party may reasonably request at any
time concerning Debtor, Guarantor and their respective affairs, or any
Collateral. Debtor shall promptly notify Secured Party of any event of default
or event or circumstance which, with notice, lapse of time or both, would be an
event of default. (b) Debtor represents and warrants that all information
furnished and to be furnished by Debtor or any Guarantor to Secured Party is
accurate, and that all financial statements Debtor or any Guarantor has
furnished and hereafter may furnish to Secured Party reasonably reflect and will
reflect, as of their respective dates, results of the operations and the
financial condition of Debtor, such Guarantor or other entity they purport to
cover. (c) Credit and other information regarding Debtor, any Guarantor or their
affiliates may be shared by Secured Party with its affiliates and agents.

REIMBURSEMENT FOR EXPENSES. At its option, and with no obligation to do so,
Secured Party may (i) if an event of default exists, discharge taxes or other
encumbrances on the Collateral, or pay for the repair, maintenance and
preservation of the Collateral and (ii) ten (10) days after notifying Debtor of
Secured Party's intent to do so, arrange and pay for insurance on the
Collateral. Debtor agrees to reimburse Secured Party on demand for any payments
so made; Debtor also agrees to reimburse and pay to Secured Party on demand all
expenses incurred or paid by Secured Party in perfecting the security interest
granted hereunder and in collecting the Indebtedness and in protecting or
enforcing Secured Party's rights under this Agreement, including but not limited
to reasonable attorney's fees and legal expenses. Until Debtor makes such
reimbursement, the amount of all such payments and expenses, with interest at
the rate then applicable to principal installments of the Loan not paid when
due, from the date of payment until reimbursement, shall be added to the
Indebtedness and shall be secured by the security interest granted by Debtor
under this Agreement. Nothing in this paragraph relieves

<PAGE>

Debtor of the duty to care for, insure and protect the Collateral and Secured
Party's interests therein and to pay tax on or related to the Collateral, or of
any other duty.

SALE OR REPLACEMENT OF COLLATERAL. Debtor shall not sell or replace any item or
part of the Collateral without the prior written consent of Secured Party,
except as noted in the section below entitled "Assignability"

POST DEFAULT INTEREST. Any principal balance not paid when due (whether by
acceleration or otherwise) shall accrue interest at the "Default Rate" until
such principal balance is paid. "Default Rate" shall be a per annum rate of
interest equal to (i) fifteen percent (15.0%) or (ii), if less, the highest rate
of interest permitted by applicable law. Upon the occurrence of an Event of
Default, Debtor shall also pay, in addition to and on the same date each
principal installment is due, additional interest ("Daily Supplemental
Interest") as reflected in Secured Party's invoice, which Secured Party shall
calculate as follows:

             Daily Supplemental Interest shall be the amount obtained by
             multiplying the principal installment, determined as of the due
             date next preceding the occurrence of the Event of Default, by
             Three percent (3.00%) and dividing the product by 360 days;
             provided that any corresponding increase in the interest rate
             hereof shall be reduced, if necessary, so as not to exceed the
             maximum interest rate permitted by applicable law.

Secured Party may, at its option, apply late payments (either in full or
partial) in the following manner: first to interest, then to principal, and
finally to late charges. To the extent permitted by applicable law, Debtor shall
pay interest on delinquent principal installments on demand regardless of
whether or not Secured Party proceeds under the "Remedies" provisions hereof or
takes any other action, and demand for and collection of interest on such
overdue installments at the Default Rate shall not be deemed a waiver of default
or of any other remedies or rights.

This paragraph shall not be construed to limit or waive any of Secured Party's
rights and remedies otherwise available to Secured Party after the occurrence of
any Event of Default

EVENTS OF DEFAULT. Debtor shall be in default under this Agreement upon the
happening of any of the following events or conditions, each of which is an
event of default:

(1) Debtor fails to pay within ten days of the day when due any installment of
the Loan, or in the payment of any other Indebtedness, when and as the same
becomes due and payable, whether at the stated maturity thereof or by
acceleration or otherwise; (2) Debtor fails to maintain insurance in respect of
any Collateral as required, or sells, leases, subleases, assigns, conveys,
encumbers or suffers to exist any lien or charge against, any Collateral without
Secured Party's prior consent, or any Collateral is subjected to levy, seizure
or attachment; (3) Debtor or any guarantor under any guaranty providing a
guaranty of Debtor's obligations hereunder ("Guarantor") fails to perform and
comply with any covenant or obligation (other than, with respect to Debtor only,
Debtor's breach of subsections (1) or (2) of this Section EVENTS OF DEFAULT)
under any Agreement, guaranty, or any progress payment, assignment, security or
other agreement related to any Agreement or Collateral (together, "Related
Agreements") and, if curable, such failure continues for 30 days after written
notice to Debtor or Guarantor, as applicable (4) any representation, warranty or
other written statement made to Secured Party in connection with this Loan, or
any guaranty, by Debtor or Guarantor, including financial statements, proves to
have been incorrect in any material respect when made; (5) Debtor (x) enters
into any merger or consolidation with, or sells or transfers all, substantially
all or any substantial portion of its assets to, or enters into any partnership
or joint venture other than in the ordinary course of business with, any entity,
(y) dissolves, liquidates or ceases or suspends the conduct of business, or
ceases to maintain its existence, or (z) enters into or suffers any transaction
or series of transactions as a result of which Debtor is directly or indirectly
controlled by persons or entities not affiliates of Debtor as of the date of
this Agreement; (6) Debtor undertakes any general assignment for the benefit of
creditors or commences any voluntary case or proceeding for relief under the
Bankruptcy Code, or any other law for the relief of debtors, or takes any action
to authorize or implement any of the foregoing; (7) the filing of any petition
or application against Debtor under any law for the relief of debtors, including
proceedings under the Bankruptcy Code, or for the subjection of property of
Debtor to the control of any court, receiver or agency for the benefit of
creditors if such petition or application is consented to by Debtor or not
dismissed within 60 days from the date of filing; (8) any payment default or
other event of default occurs under any other bilateral or multi-lateral loan,
lease, or credit, or other agreement or instrument to which Debtor and Secured
Party or any affiliate of Secured Party are now or hereafter party; (9) any
payment default or other event of default occurs under any other lease, or
credit, or other agreement or instrument or any combination thereof to which
Debtor is now or hereafter party and under which there is outstanding (on a
present value basis for all future rent, in the case of leases), owing or
committed an aggregate amount greater than $100,000.00; (10) the repudiation of
or breach or default under any guaranty relating to any Indebtedness; or (11)
the occurrence of any event described in clauses (5), (6), (7), (8) or (9) of
this Section with reference to "any Guarantor" in lieu of "Debtor", or any
Guarantor dies.

REMEDIES. Upon any event of default and at any time thereafter, Secured Party
may declare all the Indebtedness immediately due and payable in full (unless
such event of default comprises one or more of the events described in
paragraphs 7 or 8 above, in which case all the Indebtedness shall become
immediately due and payable in full without declaration, notice or other action
on the part of Secured Party), and may proceed to enforce payment thereof and
exercise any and all of the rights and remedies provided by the Uniform
Commercial Code as well as all other rights and remedies of Secured Party
hereunder or under other applicable law. Upon the occurrence of an event of
default, Debtor shall, upon demand by Secured Party, assemble the Collateral and
make it available to Secured Party at a place designated by Secured Party
reasonably convenient to both parties. Secured Party may, at its election,
enforce its rights under this Agreement by a suit in equity for specific
performance. Debtor grants Secured Party the right to enter upon any premises of
Debtor for the purpose of recovering possession of the Collateral or any part
thereof after the occurrence of an event of default, or for the preservation or
enforcement of Secured Party's other rights hereunder, all without demand or
notice to Debtor and without judicial hearing or proceedings, which Debtor
hereby expressly waives. The requirements of reasonable notice shall be deemed
met if such notice is mailed to an address of Debtor shown at the beginning of
this Agreement at least ten (10) days before the time of the sale or
disposition, but nothing contained herein shall be construed to mean that other
notice or a shorter period of time does not constitute reasonable notice of the
sale or other disposition of the Collateral. Debtor shall reimburse Secured
Party for all Secured Party's expenses of retaking, holding, preparing for sale,
selling or otherwise dealing with or disposing of the Collateral, including
attorney's fees in the amount of fifteen percent (15%) of the outstanding
principal balance of and interest on the Indebtedness (but not to exceed the
amount of attorneys' fees actually incurred) if collection is by or through an
attorney at law. Subject to applicable law, Debtor shall pay any Indebtedness
remaining unpaid after sale or other disposition of any or all of the
Collateral. Any surplus proceeds from the sale or other disposition of the
Collateral remaining after full satisfaction of the Indebtedness shall be paid
to Debtor or to such other persons as may be entitled thereto under applicable
law.

<PAGE>

CUMULATIVE RIGHTS AND NO WAIVER. Each and every right granted to Secured Party
hereunder or in connection herewith, or allowed it by law or equity, shall be
cumulative and may be exercised from time to time. No failure on the part of
Secured Party to exercise, and no delay in exercising, any right shall operate
as a waiver thereof, nor shall any single or partial exercise by Secured Party
of any right preclude any other or future exercise thereof or the exercise of
any other right.

FINANCING STATEMENTS. Debtor shall sign and deliver to Secured Party such
financing statements and other documents as Secured Party may deem necessary to
perfect, protect and continue its security interest in the Collateral, in form
satisfactory to Secured Party. Debtor will reimburse Secured Party for all
expenses incurred in the filing of financing statements, continuation
statements, termination statements and any other documents relating to the
perfection of Secured Party's security interest in the Collateral. A carbon,
photographic or other reproduction of this Agreement or of a financing statement
relating to the security interest herein granted is sufficient as a financing
statement. Debtor authorizes Secured Party to file financing statements as to
the Collateral signed only by Secured Party and not by Debtor.

SEVERABILITY. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

ASSIGNABILITY. Debtor acknowledges that the rights of Secured Party may be
assigned to any person in whole or in part at the sole discretion of Secured
Party, and Debtor agrees that any defense it may have against Secured Party as
to events occurring prior to any assignment shall not be asserted, and shall be
void, against any assignee of the rights of Secured Party. Debtor shall not
assign, pledge, hypothecate or in any way dispose of all or any part of its
rights or obligations under any Agreement, or enter into any sublease of any
Collateral, without Secured Party's prior consent; provided that Debtor may
without Secured Party's prior written consent , but only after providing Secured
Party at least 30 days' prior written notice, sell or otherwise dispose of one
or more pieces of Collateral in an aggregate amount not to exceed $200,000
during the Base Term.

In the absence of such prior written consent, no such assignment of any right or
obligation of Debtor hereunder shall be binding on Secured Party. Subject to the
foregoing limitations, the terms and conditions of this Agreement shall be
binding on and shall inure to the benefit of the heirs, executors,
administrators, successors, and assigns of the parties.

MATERIAL ADVERSE CHANGE. There has been no material adverse change in the
operations business, properties or condition (financial or otherwise ("Material
Adverse Change") Of DEbtor or Any GUarantor Since June 30, 2001. THere is not
pending against debtor any litigation, proceeding, dispute or claim that may
result in a Material Adverse Change as to DEbtor or that may call into question
or impair Debtor's legal or other ability to enter into and perform its
obligations under this Agreement.

WARRANTY DISCLAIMER. SECURED PARTY IS NOT A MANUFACTURER OR SELLER OF THE
COLLATERAL AND MAKES NO WARRANTIES WHATSOEVER WITH RESPECT TO THE COLLATERAL,
INCLUDING WITHOUT LIMITATION WARRANTIES OF TITLE, MERCHANTABILITY OR FITNESS FOR
ANY PARTICULAR PURPOSE. DEBTOR SHALL NOT ASSERT ANY BREACH OF ANY SUCH WARRANTY
AS A DEFENSE TO ANY OF ITS OBLIGATIONS TO SECURED PARTY UNDER THIS AGREEMENT;
HOWEVER, NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED TO IMPAIR ANY OF DEBTOR'S
REMEDIES FOR BREACH OF WARRANTY AGAINST ANY SELLER OR MANUFACTURER OF THE
COLLATERAL.

GOVERNING LAW; CONSENT TO VENUE AND PERSONAL JURISDICTION. THIS AGREEMENT SHALL
BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF CALIFORNIA AS OF THE DATE HEREOF. IF THE ADDRESS OF DEBTOR'S RESIDENCE
OR PRINCIPAL PLACE OF BUSINESS SHOWN HEREIN IS NOT IN THE STATE OF CALIFORNIA,
DEBTOR CONSENTS TO THE EXERCISE OF PERSONAL JURISDICTION OVER DEBTOR BY ANY
COURT OR RECORD SITTING IN THE STATE OF CALIFORNIA IN CONNECTION WITH ANY ACTION
ARISING OUT OF THIS AGREEMENT, AND WAIVES ALL OBJECTIONS TO SERVICE OF PROCESS
ON DEBTOR AT SUCH ADDRESS.

WAIVER OF JURY TRIAL. SECURED PARTY AND DEBTOR EACH WAIVE TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES AGAINST THE
OTHER ON ANY MATTER WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS
AGREEMENT.

IN WITNESS WHEREOF, the parties have caused their names to be signed and their
seals affixed as of the date first above written. By execution hereof, each
party intends and agrees to be legally bound by all the provisions of this
Agreement.

<TABLE>
<S>                                             <C>
BANC OF AMERICA LEASING & CAPITAL, LLC          PENHALL COMPANY
(Secured Party)                                 (Debtor)

By: ____________________________________        By: ____________________________________

Printed Name: __________________________        Printed Name: __________________________

Title: _________________________________        Title: _________________________________
</TABLE>

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