Document:

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                                                                    EXHIBIT 10.4

                               SECOND AMENDMENT TO
                              EMPLOYMENT AGREEMENT
                            AND CONSULTING AGREEMENT

         This Second Amendment (this "Amendment") to Employment Agreement, which
shall be effective as of April 1, 2003 is by and among Joel Borovay ("Borovay"),
Insight Services Corporation ("ISC") and Insight Direct Worldwide, Inc. ("IDW").
ISC, IDW, and/or any of their affiliates as may be appropriate under applicable
facts and circumstances, are collectively called "Company."

RECITALS

         A.       Borovay is currently employed by Company pursuant to an
Employment Agreement dated 11/17/2000 (the "Original Agreement"), an Amendment
to Employment Agreement effective April 25, 2002 (the "First Amendment") and a
letter from ISC dated December 27, 2002 notifying Borovay of the termination of
the renewal under the Agreement as amended by the First Amendment (the
"Notice"). For purposes of this Amendment, the Original Agreement, the First
Amendment and the Notice are collectively called the "Agreement."

         B.       The parties mutually desire to modify their current employment
relationship, provide for an orderly termination of Borovay's employment, and
provide for a period of consulting by Borovay, all on terms satisfactory to both
Borovay and Company, as further set forth in this Amendment.

AGREEMENTS

         In consideration of the acts, payments, covenants and mutual agreements
contained herein, Company and Borovay agree as follows:

         1.       Modification of Current Relationship. Effective as of March
18, 2003 (the "Effective Date"), Borovay hereby resigns from all officer
positions he holds with Company. Thereafter, Borovay's employment by Company
shall continue until June 16, 2003, at which time it shall end for all purposes
(the "Date of Termination"). As of the Effective Date, Borovay will have no
specific duties with respect to the Company, but shall be available to consult
on Company matters and assist with Company projects as may be requested from
time to time by the CEO or President of Insight Enterprises, Inc. or by the
President of Insight North America, Inc. Borovay shall be entitled to receive
his base salary and accrued vacation through June 16, 2003 and a bonus with
respect to the first quarter of 2003 in accordance with the provisions of the
Agreement. Payment for the base salary, the accrued but unpaid vacation, and the
bonus shall be made in accordance with Company's standard payroll policies. From
and after the Effective Date, and continuing throughout the Consulting Term, as
defined below, Borovay shall no longer have access to Company premises, except
by invitation, and shall not have any required number

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of work hours so long as he responds appropriately to Company's reasonable
requests for consulting services; he shall not have any Company titles and shall
not have any authority to act for or on behalf of the Company or to bind the
Company in any way. From and after the Date of Termination, Borovay shall have
no further rights or duties as an employee or officer for or on behalf of
Company. The termination shall be treated by both parties as a termination by
Borovay without "Good Reason."

         2.       Engagement as Consultant. Subject to the terms and conditions
of this Agreement, during the Consulting Term, as defined below, Borovay agrees
to perform services for Company as defined in this Section 2. Beginning on June
17, 2003 and continuing until March 31, 2004, Borovay shall serve as a
consultant for Company unless the consulting arrangement is terminated earlier
as provided in this Agreement (the "Consulting Term"). During the Consulting
Term, Borovay shall be available to consult on Company matters and assist with
Company projects as may be requested from time to time by the CEO or President
of Insight Enterprises, Inc. or by the President of Insight North America, Inc.
The Consulting arrangement may only be terminated by Company for "Cause," which
is defined for this purpose to mean Company's reasonable belief that Borovay has
breached any provision of the Agreement or this Amendment or any other
obligation to Company, engaged in any misconduct or dishonesty relating to
Company or engaged in any other conduct disruptive to the business or operations
of Company. Any termination of the Consulting arrangement by Company for Cause
shall be as provided in Section 16 of this Amendment.

         3.       Total Compensation Payable. During the Consulting Term,
Company agrees to pay Borovay, at the annual rate of $300,000 in monthly
installments of $25,000 which shall be payable mid-monthly and prorated for
periods of less than one full month. Except as specifically stated in this
Agreement, after June 16, 2003, no other compensation whatsoever, including
without limitation any Base Salary, bonuses or severance benefits, after a
Change in Control or otherwise, of any type, shall be earned by or paid to
Borovay by Company. The first prorated payment for the period beginning on June
16 and ending on June 30, 2003 shall be paid on July 1, 2003, with the remaining
payments due and payable on the fifteenth day of each month commencing on July
15, 2003. Payments falling on Saturday, Sundays or holidays shall be due the
next business day.

         4.       Expenses. Borovay shall pay all of his own expenses in
connection with this engagement as a consultant.

         5.       Independent Contractor Relationship During the Consulting
Term. Borovay and Company understand and acknowledge that Borovay's relationship
with Company during the Consulting Term will be that of an independent
contractor and nothing in this Agreement is intended to or should be construed
to create a partnership, joint venture, employment, or other relationship.
Borovay further acknowledges that neither Borovay nor any of Borovay's employees
or agents will be treated or regarded as Company's employees under the laws or
regulations of any government or governmental agency. Company will not withhold
from Borovay's fees any amounts for income taxes or other similar assessments,
and Borovay will

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indemnify Company to the extent of any payments imposed on the Company by any
taxing authority characterizing Borovay as an employee for tax purposes. Borovay
will be the sole judge of the means, manner and method by which he will perform
the services contracted for, the times at which those services will be performed
(within the deadlines reasonably and mutually established by Company and
Borovay) and the sequence of performance of those services. Company does not
have the authority to supervise or control the actual work of Borovay. It is
further agreed that Company:

         A.       will not provide Borovay with any transportation, business
                  registrations or licenses required to perform the specific
                  services set forth in this Agreement;

         B.       will not pay Borovay a salary or hourly rate;

         C.       will not terminate this Agreement before the expiration of its
                  Term, unless Borovay violates or fails to perform the services
                  required by this Agreement;

         D.       will not provide an automobile, tools or equipment for
                  Borovay;

         E.       will not dictate the time of performance of Borovay's
                  performance;

         F.       will pay Borovay in the name appearing on this Agreement; and

         G.       will not combine business operations with Borovay, but instead
                  will keep the operations of Borovay and Company separate.

         6.       Nondelegability of Borovay's Rights and Company Assignment
Rights. The obligations, rights and benefits of Borovay hereunder are personal
and may not be delegated, assigned or transferred in any manner whatsoever, nor
are such obligations, rights or benefits subject to involuntary alienation,
assignment or transfer. This Agreement shall be assigned automatically to and
assumed by any entity merging with or acquiring Company.

         7.       Benefits. Between the Effective Date and the Date of
Termination, Company shall extend benefits to Borovay, on the same basis upon
which he participated prior to the Effective Date, including without limitation,
to the extent Borovay previously had coverage, dental, health, vision,
short-term and long-term disability, and long term care. Beginning as of the
Termination Date, Borovay, his currently covered domestic partner and each
eligible dependent who constitutes a qualified beneficiary, as defined in
Section 4980B(g)(1) of the Internal Revenue Code of 1986, as amended, will be
eligible to continue benefits coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"), within the time period
prescribed pursuant to COBRA. Borovay acknowledges that the Company has provided
him with information concerning his obligations and time requirements to secure
COBRA benefits. With respect to the period between the Termination Date and
March 31, 2004, Company will reimburse Borovay for any incremental cost incurred
by Borovay over the costs to Company employees to secure comparable benefits to
the extent they are available under COBRA. To the extent he desires such
coverages, Borovay will need to obtain replacement coverages for vision, life
and disability insurance since they will not be available under COBRA. Company
will reimburse Borovay for the difference in premiums between what employees of
Company are required to pay for coverages maintained by Borovay through Company
prior to the date of this Amendment and reasonable premiums actually paid by
Borovay with respect to the

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same types and levels of coverage for the period between the Termination Date
and March 31, 2004. Borovay will also be permitted to participate through March
31, 2004 in the employee product purchase plan at the discount rate, and subject
to the same terms and conditions, as are in effect as of the date of this
Amendment. Except as specifically stated in this Section 7, Borovay shall not be
entitled to participate in any new or additional benefits.

         8.       Stock Options. Borovay's options to purchase stock of Company
stock and or any Company subsidiaries shall continue, vest and expire pursuant
to their existing terms, consistent with a termination by Borovay, without Good
Reason, effective as of the Date of Termination. Specifically, Borovay will have
seven business days after the Date of Termination to exercise his vested
options. Any options not vested on the Date of Termination and any vested
options not exercised within seven business days after the Date of Termination
will be forfeited back to Company. Borovay agrees that all options to purchase
stock of the Company's subsidiaries will be forfeited on the Date of
Termination.

         9.       Mutual Release and Covenant Not to Sue. Except as provided in
this Amendment, Borovay hereby releases, acquits and forever discharges Company,
its subsidiaries, affiliates, directors, officers, employees and agents of and
from any and all actions, claims, damages, expenses or costs of whatever nature
arising out of Borovay's employment and the termination of such relationship, or
arising from the Agreement, including, but not limited to, any rights or claims
to any vacation, sick leave, severance, medical, dental or any other benefits
under the Company's internal policies, under any federal, state or local statute
or regulation, or under common law. By way of example only and without limiting
the immediately preceding paragraph, this release is applicable to any cause of
action, right, claim or liability under Title VII of the 1964 Civil Rights Act
of 1964, the Civil Rights Act of 1991, the Age Discrimination in Employment Act
of 1967, Section 1981 of the 1866 Civil Rights Act, the Equal Pay Act of 1963,
the Americans with Disabilities Act of 1990, the Arizona Civil Rights Act, the
Fair Labor Standards Act, the Employee Retirement Income Security Act of 1974,
the Worker Adjustment and Retraining Notification Act, the Older Workers Benefit
Protection Act and/or any other equal employment opportunity law or statute, or
in the nature of wrongful discharge, breach of implied or express contract,
breach of the covenant of good faith and fair dealing, intentional or negligent
infliction of emotional distress or defamation and to any other claim in
contract or tort.

         Except for an appropriate administrative charge challenging the
validity of this release (which Company reserves the right to contest), Borovay
further covenants and agrees not to join in or commence any action, suit or
proceeding, in law or in equity, or before any administrative agency, or to
incite, encourage, or participate in any such action, suit or proceedings,
against Company, its subsidiaries, affiliates, directors, officers, employees or
agents in any way pertaining to or arising out of the termination of his
employment by or service as an employee, consultant, officer or director of
Company (or any subsidiary).

         Borovay acknowledges that the consideration afforded him under this
Amendment, including the payments described in Paragraph 2 above, are in full
and complete satisfaction of

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any claims Borovay may have, or may have had, arising out of his employment with
Company (or any subsidiary) or the termination thereof.

         Company, for itself, and any parent, subsidiary and affiliated
corporations does fully release and discharge Borovay, his heirs and successors,
from all known grievances, suits, causes of action, and/or claims of any nature
whatsoever, which Company has or may have against Borovay arising out of or in
any way relating to the Agreement, including without limitation actions taken by
Borovay during the term of said Agreement, whether such claims exist in law or
in equity, under federal, state or other law and whether the same be upon
statutory, tort, contract or other basis.

         Borovay hereby assigns to Company any and all intellectual property
rights or interests he has in or to the technology known as Asset Spider,
including, without limitation, any interest in the pending patent application
and any future patents or patent applications. Borovay represents that he has
not assigned or transferred any such rights to any other person or entity, and
will take any additional actions appropriate for the completion of this
assignment.

         10.      Time Period for Considering or Canceling this Amendment.
Borovay acknowledges that Company has advised him to consult with an attorney of
his choice with respect to this Amendment. Borovay further acknowledges that he
has been offered a period of time of at least 21 days to consider whether to
sign this Amendment, and Company agrees that Borovay may cancel this Amendment
at any time during the seven days following the date on which this Amendment has
been signed by him. In order to cancel or revoke this Amendment, Borovay must
deliver to the attention of General Counsel at 1305 W. Auto Drive, Tempe,
Arizona 85284, written notice stating that Borovay is canceling or revoking this
Amendment. If this Amendment is timely canceled or revoked, none of the
provisions of this Amendment shall be effective or enforceable, Company shall
not be obligated to make any payments described herein to Borovay or to provide
Borovay with the other benefits described in this Amendment, and neither party
shall be bound by the characterization of the termination as one by Borovay
without Good Reason.

         11.      Competing Business. Borovay and Company agree that "Competing
Business" as used in the Agreement shall refer solely to the companies and
businesses described in this Section 11. The companies contemplated in the
preceding sentence are CDW Computer Centers Inc., PC Connection Inc, Micro
Warehouse Inc., PC Mall, Inc., Compucom Systems, Inc., and Dell Computer
Corporation plus any affiliate of any such company and any companies or
businesses acquired by or sold or spun or split off, or otherwise divested, by
any of such companies, regardless of the form of entity in which such business
is conducted or such company is included. The parties further agree that
"Competing Business" shall also include the customer- direct activities of
Hewlett-Packard Company and International Business Machines Corporation, whether
developed internally, outsourced or acquired, but shall specifically exclude
the non-customer-direct activities or divisions of the Hewlett-Packard Company
and International Business Machines Corporation, and any companies or businesses
sold or spun or split off, or otherwise divested, by either Hewlett-Packard

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Company or International Business Machines Corporation so long as such
companies, businesses or affiliates do not engage in direct selling to
customers.

         12.      Time Period for Restrictive Covenants. Borovay and Company
agree that all restrictive covenants as set forth in Section 9 of the Original
Agreement shall terminate on March 31, 2004.

         13.      Confidentiality. Except with respect to disclosure by Company
of this Amendment to its officers, board members, parent companies, attorneys
and accountants on a need-to-know basis, disclosure by Borovay to his attorneys
and accountants on a need-to-know basis, or disclosure by either party in
connection with reasonable enforcement of his or its rights pursuant to the
Agreement or this Amendment, each of Borovay and Company agrees not to
disseminate or disclose to any person or entity the terms of this Amendment or
the events, discussions and correspondence leading to this Amendment.
Notwithstanding the foregoing, no provision of this Amendment shall be construed
as prohibiting compliance with a valid subpoena issued by a court of competent
jurisdiction requesting specific information to be disclosed. However, should
Borovay or Company receive such a subpoena, he or it will immediately inform the
other party and, except to the extent required by law, will not produce any
information until the other party has had a reasonable period of time to seek to
quash or modify the subpoena.

         14.      Reliance. Borovay warrants and represents that (i) he has
consulted with an attorney of his choosing or decided not to contact an
attorney; (ii) he has relied on his own judgment regarding the consideration for
and language of this Amendment; (iii) Company has not in any way coerced or
unduly influenced him to execute this Amendment; and (iv) this Amendment is
written in a manner that is understandable to him and he has read an understood
all paragraphs of this Amendment.

         15.      Nature of the Agreement plus this Amendment. Except as
specifically modified by this Amendment, the Agreement shall remain in full
force and effect and shall be enforceable by the parties in accordance with its
terms. All provisions of this Amendment, including all representations and
promises contained herein, are contractual and not a mere recital and shall
continue in permanent force and effect. The Agreement plus this Amendment
constitute the sole and entire agreement of the parties with respect to the
subject matter hereof, superseding all prior agreements and understandings
between the parties, and there are no agreements of any nature whatsoever
between the parties hereto except as expressly stated herein. The Agreement plus
this Amendment may not be modified or changed except by means of a written
instrument signed by both parties. If any portion of the Agreement plus this
Amendment is found to be unenforceable for any reason whatsoever, the
unenforceable provision shall be considered to be severable, and the remainder
of the Agreement plus this Amendment shall continue to be in full force and
effect, provided, however, that all of the Company's obligations hereunder are
expressly conditioned on Borovay's compliance with Sections 9, 11, 12, 13 and 17
of this Amendment and the Restrictive Covenants in Section 9 of the Original
Agreement as modified

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by this Amendment. The Agreement plus this Amendment shall be governed by and
construed and enforced in accordance with the laws of the State of Arizona.

         16.      Termination and Remedies. Either party may terminate its
continuing obligations under the Agreement, as modified by this Amendment, by
written notice to the other party, but only after giving the allegedly
non-performing party 15 days notice of the alleged material breach or grounds
for Cause and an opportunity to cure the breach or grounds for Cause. Any and
all remedies set forth herein are intended to be nonexclusive and either party
may, in addition to such remedies, seek any additional remedies available either
in law or in equity in the event of default or material breach by the other
party. In addition to any remedies available at law or in equity, (a) if Company
fails to cure a material breach within 15 days after receiving notice from
Borovay, all payments due and payable to Borovay under this Agreement shall be
due and payable immediately and the restrictions set forth in Section 9 of the
Original Agreement and as amended by this Amendment shall be deemed null and
void; and (b) if Borovay fails to cure a material breach or grounds for Cause
within 15 days after receiving notice from Company, Company shall be entitled to
discontinue all payments to and benefits for Borovay, and shall be entitled to
pursue any and all legal remedies without thereby excusing Borovay from his
continuing obligations under the Agreement as modified by this Amendment.

         17.      Testimony. If Borovay has knowledge of or is alleged to have
knowledge of any matters which are the subject of any pending, threatened or
future litigation involving Company, he will make himself available to testify
if and as necessary. Borovay will also make himself available to the attorneys
representing Company in connection with any such litigation or dispute for such
purposes as they may deem necessary or appropriate, including but not limited to
the review of documents, discussion of the case and preparation for any legal
proceedings. This Amendment is not intended to and shall not be construed so as
to in any way limit or affect the testimony which Borovay gives in any such
proceedings. Further, it is understood and agreed that Borovay will at all times
testify fully, truthfully and accurately, whether in deposition, hearing, trial
or otherwise.

         18.      Forum and Arbitration. Any disputes under the Agreement or
this Amendment not resolved by agreement of the parties will be submitted to
binding arbitration in metropolitan Phoenix, Arizona, before a single
arbitrator; or, if the parties cannot agree upon a single arbitrator, before a
panel of three arbitrators, one selected by each party (within 10 days after
notice of a dispute and failure to agree upon a single arbitrator) and a third
appointed by the arbitrators selected by the parties. The selection of
arbitrators and all arbitration proceedings will be in accordance with the rules
of the American Arbitration Association, as amended to the date of the
proceedings, and judgment upon the award may be entered in any court having
jurisdiction. The arbitrators shall have the discretion to permit or require
such discovery as is relevant and necessary to a fair resolution of the dispute,
subject to such orders of protection and confidentiality as they deem
appropriate and may award the costs of arbitration as they see fit.

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Dated as of April 1, 2003.

By: /s/ Joel Borovay
    -------------------
JOEL BOROVAY

INSIGHT SERVICES CORPORATION

By: /s/ P. Robert Moya
    ----------------------
Name:  P. Robert Moya
Title: Executive Vice President

INSIGHT DIRECT WORLDWIDE, INC.

By: /s/ P. Robert Moya
    ----------------------
Name:  P. Robert Moya
Title: Executive Vice President

                                       8<PAGE>
                                                                   Exhibit 10.42

                          FIFTH MODIFICATION AGREEMENT

DATE:                      March 13, 2003

PARTIES:     Borrower:     WHITE ELECTRONIC DESIGNS CORPORATION,
                           an Indiana corporation

             Lender:       BANK ONE, NA, a national banking association
                           with its main office in Chicago, Illinois,
                           successor by merger to Bank One, Texas, N.A.

                                    RECITALS:

      A. Lender has extended to Borrower credit ("Loan") in the principal amount
of $12,000,000 pursuant to the Loan and Security Agreement, dated January 7,
2000 ("Loan Agreement"), and evidenced by the Promissory Note, dated June 30,
2000 ("Note"). The unpaid principal of the Loan as of the date hereof is
$6,128,228.24. Capitalized terms used herein and not otherwise defined shall
have the meanings given them in the Loan Agreement.

      B. The Loan is secured by, among other things, the Mortgage, Security
Agreement, Assignment of Rents and Fixture Filing, dated January 7, 2000 ("Deed
of Trust"), by Borrower, as trustor, for the benefit of Lender, as beneficiary,
recorded on January 11, 2000, at Document No. 200002196, records of Allen
County, Indiana. The agreements, documents, and instruments securing the Loan
and the Note are referred to individually and collectively as the "Security
Documents."

      C. Lender and Borrower have executed and delivered previously the
following agreements ("Modifications") modifying the terms of the Loan, the
Note, the Loan Agreement, and/or the Security Documents: First Amendment to Loan
and Security Agreement dated as of June 30, 2000, Second Amendment to Loan and
Security Agreement dated as of June 29, 2001, Third Modification Agreement dated
as of March 28, 2002 and Fourth Modification Agreement dated as of January 13,
2003. The Note, the Loan Agreement, the Security Documents, any arbitration
resolution, any environmental certification and indemnity agreement, and all
other agreements, documents, and instruments evidencing, securing, or otherwise
relating to the Loan, as modified in the Modifications, are sometimes referred
to individually and collectively as the "Loan Documents." Hereinafter, "Note,"
"Loan Agreement," "Deed of Trust" and "Security Documents" shall mean such
documents as modified in the Modifications.

      D. Unlimited Guaranties guaranteeing repayment of the Loan (the "Guarantee
Agreements") were executed and delivered to Lender by Electronic Designs, Inc.,
a Delaware corporation ("EDI"), and Panelview, Incorporated, an Oregon
corporation ("Panelview") (hereinafter EDI and Panelview together are called
"Original Guarantors").

      E. IDS Reorganization Corp., an Arizona corporation, a wholly-owned
subsidiary of Borrower, has merged (the "Merger") with and into Interface Data
Systems, Inc., an Arizona

<PAGE>
                                                                   Exhibit 10.42

corporation ("IDSI"); IDS Acquisition Corporation, an Arizona corporation
("IDSA"), continues as a subsidiary of IDSI.

      F. Borrower has requested that Lender modify the Loan and the Loan
Documents as provided herein. Lender is willing to so modify the Loan and the
Loan Documents, subject to the terms and conditions herein.

                                   AGREEMENT:

      For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Borrower and Lender agree as follows:

SECTION 1. ACCURACY OF RECITALS.

      1.1 Borrower acknowledges the accuracy of the Recitals.

SECTION 2. MODIFICATION OF LOAN DOCUMENTS; OTHER AGREEMENTS.

      2.1 The following definitions in Section 1.1 of the Loan Agreement are
hereby amended to read as follows:

            "Collateral" means and includes all of Borrower's and of each
      Guarantor's now owned or hereafter acquired assets, whether real or
      personal property and whether tangible or intangible, including without
      limitation all of Borrower's and of each Guarantor's right, title and
      interest in and to each of the following, wherever located and whether now
      existing or hereafter arising: (a) all accounts, (b) all inventory, (c)
      all equipment, (d) all contract rights, (e) all general intangibles, (f)
      all Intellectual Property, (g) all deposit accounts, (h) all investment
      property, (i) all instruments, (j) all chattel paper, (k) all goods, (l)
      all documents, (m) all insurance and certificates of insurance pertaining
      to any and all items of Collateral, (n) all files, correspondence,
      computer programs, tapes, disks and related data processing software which
      contain information identifying or pertaining to any of the Collateral or
      any Account Debtor or showing the amounts thereof or payments thereon or
      otherwise necessary or helpful in the realization thereon or the
      collection thereof, (o) all cash deposited with Lender or any Affiliate
      thereof, and (p) any and all products and cash and non-cash proceeds of
      the foregoing (including, but not limited to, any claims to any items
      referred to in this definition and any claims against third parties for
      loss of, damage to or destruction of any or all of the Collateral or for
      proceeds payable under or unearned premiums with respect to policies of
      insurance) in whatever form.

      "Committed Sum" means $12,000,000.00.

      "Contract Rate" means a rate of interest based upon the Adjusted LIBOR
Rate (as defined in the applicable Note) or Adjusted Prime Rate (as defined in
the applicable Note) in effect at any time pursuant to an Interest Notice (as
defined in the applicable Note).

                                       -2-
<PAGE>

                                                                   Exhibit 10.42

            "Eligible Accounts" means all accounts of Borrower and of each
      Guarantor, which are deemed by Lender in the exercise of its sole and
      absolute discretion to be eligible for inclusion in the calculation of the
      Borrowing Base net of any and all interest, finance charges, sales tax,
      fees, returns, discounts, claims, credits, charges, contra accounts,
      exchange contracts or other allowances, offsets and rights of offset,
      deductions, counterclaims, disputes, rejections, shortages or other
      defenses and all credits owed or allowed by Borrower or any Guarantor, as
      appropriate, upon any of their respective accounts and further reduced by
      the aggregate amount of all reserves, limits and deductions provided for
      in this definition and elsewhere in this Agreement. Eligible Accounts
      shall not include the following:

               (a) accounts which remain unpaid more than ninety (90) days past
            their invoice dates;

               (b) accounts which are not due and payable within thirty (30)
            days after their invoice dates;

               (c) accounts owing by a single Account Debtor if twenty percent
            (20%) or more of the aggregate balance owing by said Account Debtor
            is ineligible pursuant to clauses (a) or (b) above;

               (d) accounts with respect to which the Account Debtor is an
            Affiliate of Borrower or any Guarantor;

               (e) accounts with respect to which the obligation of payment by
            the Account Debtor is or may be conditional for any reason
            whatsoever including, without limitation, accounts arising with
            respect to goods that were (i) not sold on an absolute basis, (ii)
            sold on a bill and hold sale basis, (iii) sold on a consignment sale
            basis, (iv) sold on a guaranteed sale basis, (v) sold on a sale or
            return basis, or (vi) sold on the basis of any other similar
            understanding;

               (f) Canadian accounts in excess of an aggregate cap of
            $1,500,000, and other accounts with respect to which the Account
            Debtor is not a resident or citizen of, or otherwise located in, the
            continental United States of America, or with respect to which the
            Account Debtor is not subject to service of process in the
            continental United States of America, unless such accounts are
            backed in full by irrevocable letters of credit or insurance in form
            and substance satisfactory to Lender issued or confirmed by a
            domestic commercial bank acceptable to Lender; provided, however,
            that such non-Canadian accounts shall not exceed $2,500,000 in the
            aggregate;

                                       -3-
<PAGE>

                                                                   Exhibit 10.42

               (g) accounts in excess of $100,000 in the aggregate with respect
            to which the Account Debtor is the United States of America or any
            other federal governmental body unless such accounts are duly
            assigned to Lender in compliance with all applicable governmental
            requirements (including, without limitation, the Federal Assignment
            of Claims Act of 1940, as amended, if applicable);

               (h) accounts with respect to which Borrower or any Guarantor is
            or may be liable to the Account Debtor for goods sold or services
            rendered by such Account Debtor, but only to the extent of such
            liability to such Account Debtor;

               (i) accounts with respect to which the goods giving rise thereto
            have not been shipped and delivered to and accepted as satisfactory
            by the applicable Account Debtor or with respect to which the
            services performed giving rise thereof have not been completed and
            accepted as satisfactory by the Account Debtor thereon;

               (j) accounts which are not invoiced within five (5) days after
            the shipment and delivery to and acceptance by said Account Debtor
            of the goods giving rise thereto or the performance of the services
            giving rise thereto;

               (k) accounts which are not subject to a first priority perfected
            security interest in favor of Lender;

               (l) that portion of an account balance owed by a single Account
            Debtor which exceeds fifteen percent (15%) of total accounts
            otherwise deemed eligible hereunder; and

               (m) accounts that Lender, in its sole discretion, has determined
            to be ineligible.

      "Eligible Equipment" means, as of any date of determination, all equipment
owned by and in the possession of Borrower or any Guarantor that Lender, in its
sole and absolute discretion, deems to be eligible for borrowing purposes.

      "Eligible Inventory" means, as at any date of determination, all inventory
owned by and in the possession of Borrower or any Guarantor and located in the
United States of America that Lender, in its sole and absolute discretion, deems
to be eligible for borrowing purposes. Without limiting the generality of the
foregoing, unless otherwise agreed by Lender, the following is not Eligible
Inventory:

               (a) work-in-process;

                                       -4-
<PAGE>

                                                                   Exhibit 10.42

               (b) finished goods which do not meet the specifications of the
            purchase order for such goods;

               (c) inventory which Lender determines, in its sole and absolute
            discretion, to be unacceptable for borrowing purposes;

               (d) inventory with respect to which Lender does not have a valid,
            first priority and fully perfected security interest;

               (e) inventory with respect to which there exists any Lien in
            favor of any Person other than Lender;

               (f) packaging and shipping materials, products and labels;

               (g) inventory that is obsolete or returned or repossessed or used
            goods taken in trade;

               (h) inventory produced in violation of the Fair Labor Standards
            Act, in particular provisions contained in Title 29 U.S.C.
            215(a)(i); and

               (i) inventory located at a location for which Lender does not
            have a valid landlord's or warehouseman's waiver or subordination on
            terms and conditions acceptable to Lender in its sole discretion and
            inventory located at any location other than those listed on
            Schedule 5.1(q).

      "Loans" mean the Revolving Loan and the Term Loan, collectively, and
"Loan" means any of such Loans.

      "Maximum Rate" means the maximum nonusurious interest rate, if any, that
at any time, or from time to time, may be contracted for, taken, reserved,
charged, or received on the Loans under the laws which are presently in effect
of the United States and the State of Arizona applicable to Lender and such
indebtedness or, to the extent permitted by law, under such applicable laws of
the United States or the State of Arizona which may hereafter be in effect and
which allow a higher maximum nonusurious interest rate than applicable laws now
allow. To the extent federal law permits Lender to contract for, charge or
receive a greater amount of interest, Lender will rely on federal law, instead
of the laws of the State of Arizona, for the purpose of determining the Maximum
Rate. Additionally, to the maximum extent permitted by applicable law now or
hereafter in effect, Lender may, at its option and from time to time, implement
any other method of computing the Maximum Rate under the Act or under other
applicable law by giving notice, if required, to Borrower as provided by
applicable law now or hereafter in effect.

                                       -5-
<PAGE>

                                                                   Exhibit 10.42

            "Notes" means the Revolving Note and the Term Note, and "Note" means
      any of such Notes.

            "Permitted Investments" means Investments of Borrower in: (a)
      negotiable certificates of deposit issued by Lender, (b) any direct
      obligation of the United States of America or any agency or
      instrumentality thereof which has a remaining maturity at the time of
      purchase of not more than one year and repurchase agreements relating to
      the same, and (c) any Guarantor.

            "Prohibited Distribution" by any Person means (a) the retirement,
      redemption, purchase, or other acquisition for value of any capital stock
      or other equity securities or partnership interests issued by such Person,
      (b) the declaration or payment of any dividend or distribution on or with
      respect to any such securities (excluding distributions made solely in
      shares of stock of the same class) or partnership interests, (c) any loan
      or advance by such Person to, or other investment by such Person in, any
      other Person other than a Guarantor, and(d) any other payment by such
      Person in respect of such securities or partnership interest.

            "Schedule of Equipment" means a schedule of all equipment of
      Borrower and the Guarantors delivered by Borrower to Lender from time to
      time.

            "Term Loan" means the loan made to Borrower pursuant to Section 2.4.

            "Term Note" means the Promissory Note executed by Borrower
      evidencing the Term Loan (and any renewal, extension, increase, or
      modification thereof).

      2.2 Section 1.1 of the Loan Agreement is hereby amended by the addition of
the following definitions:

            "Appraisal" means a current appraisal of the Collateral that
      consists of real property, by an appraiser acceptable to Lender in its
      sole and absolute discretion, reviewed and approved by Lender in its sole
      and absolute discretion.

            "Fifth Modification Closing Date" means March 13, 2003.

            "Guarantors" means EDI, Panelview, IDSI and IDSA, each a Guarantor.

            "IDSA" means IDS Acquisition Corporation, an Arizona corporation.

            "IDSA Real Property" means that real property owned by IDSA.

            "IDSI" means Interface Data Systems, Inc., an Arizona corporation.

            "IDSI Real Property" means that real property owned by IDSI.

                                      -6-
<PAGE>

                                                                   Exhibit 10.42

            "IDSR" means IDS Reorganization Corp., an Arizona corporation, a
      wholly-owned subsidiary of Borrower.

            "Rate Management Transaction" means any transaction (including an
      agreement with respect thereto) now existing or hereafter entered into
      among Borrower, Lender or Bank One Corporation, or any of its subsidiaries
      or affiliates or their successors, which is a rate swap, basis swap,
      forward rate transaction, commodity swap, commodity option, equity or
      equity index swap, equity or equity index option, bond option, interest
      rate option, foreign exchange transaction, cap transaction, floor
      transaction, collar transaction, currency option or any other similar
      transaction (including any option with respect to any of these
      transactions) or any combination thereof, whether linked to one or more
      interest rates, foreign currencies, commodity prices, equity prices or
      other financial measures.

            "Real Property" means collectively the White Real Property, the IDSI
      Real Property and the IDSA Real Property.

            "White Real Property" means that real property owned by Borrower.

      2.3 Sections 2.4, 2.5 and 2.7 of the Loan Agreement are hereby amended to
read as follows:

            Section 2.4 Term Loan. Upon the terms and conditions of this
      Agreement, Lender agrees to make a term loan to Borrower in the amount of
      $6,000,000.00, the sole purpose of which is to finance the merger of IDSR
      into IDSI (the "Merger"). In the event that the Merger is not completed or
      is canceled for any reason, Lender's agreement to make the Term Loan shall
      terminate.

            Section 2.5 Repayment of Term Loan. The Term Loan is due and payable
      as provided in the Term Note.

            Section 2.7 [Intentionally left blank].

      2.4 Section 3.1(a) of the Loan Agreement is hereby amended to read as
      follows:

            (a) Loans. Borrower shall pay interest on the unpaid principal
      amount of the Revolving Loan and the Term Loan at a rate per annum equal
      to the lesser of (A) the Maximum Rate, or (B) Contract Rate, payable
      monthly in arrears in accordance with the terms of the Revolving Note
      and/or Term Note, as appropriate.

      2.5 Section 5.1(c) of the Loan Agreement is hereby amended to read as
follows:

            (c) Subsidiaries; Ownership. Each Guarantor is a subsidiary of
      Borrower, either directly or indirectly. Borrower has no subsidiaries
      other than the Guarantors. None of the Guarantors has any subsidiary that
      is not a Guarantor. The outstanding stock of Borrower has been duly and
      validly

                                      -7-
<PAGE>

                                                                   Exhibit 10.42

      issued and is fully paid and nonassessable and the number and owners of
      such shares of capital stock are set forth on Schedule 5.1(c).

      2.6 Sections 6.2 through 6.11 of the Loan Agreement are each hereby
amended to read as follows:

      Section 6.2 Collection of Accounts.

            (a) Upon the occurrence of an Event of Default, Borrower shall, and
      shall cause EDI to, cause all moneys, checks, notes, drafts and other
      payments relating to or constituting proceeds of accounts, or of any other
      Collateral, to be forwarded to a Lockbox for deposit in (i) the Collection
      Account, if such Lockbox is maintained pursuant to a Lockbox agreement
      with Lender, and (ii) a Blocked Account, if such Lockbox is maintained
      with a Collecting Bank pursuant to a Blocked Account Agreement, in
      accordance with the procedures set out in the corresponding Blocked
      Account Agreement. In particular, upon the occurrence of an Event of
      Default, Borrower shall, and shall cause EDI to, (i) advise each Account
      Debtor to address to a Lockbox specified by Lender all remittances with
      respect to amounts payable on all accounts, and (ii) stamp all invoices
      relating to any such amounts with a legend satisfactory to Lender
      indicating that payment is to be made to Borrower or EDI, as appropriate,
      via such specified Lockbox.

            (b) Upon the occurrence of an Event of Default, Borrower shall cause
      Panelview, IDSI and IDSA to cause all moneys, checks, notes, drafts and
      other payments relating to or constituting proceeds of accounts, and of
      all other Collateral provided by Panelview, IDSI and IDSA, to be deposited
      in, or forwarded to, the Collection Account not less often than weekly.
      Upon the occurrence of an Event of Default, Borrower shall cause
      Panelview, IDSI and IDSA to cause all such proceeds to be deposited in a
      Blocked Account for forwarding to the Collection Account.

            (c) Upon the occurrence of an Event of Default, Borrower and Lender
      shall (and Borrower shall cause EDI to) cause all balances in each Blocked
      Account to be transmitted daily to the Collection Account by wire transfer
      or depository transfer check or Automated Clearing House transfer in
      accordance with the procedures set forth in the corresponding Blocked
      Account Agreement. Deposits in the Collection Account that represent
      proceeds of accounts of Borrower or of EDI shall be credited, subject to
      final payment, to the payment of the Obligations two days after the date
      of actual receipt and deposit into the Collection Account by Lender.
      Deposits in the Collection Account that represent proceeds of accounts of
      Panelview, IDSI or IDSA shall be credited, subject to final payment, to
      the payment of the Obligations on the date of actual receipt and deposit
      into the Collection Account by Lender. The delay in applying funds held in
      the Collection Account to the Obligations shall in all respects be limited
      so that interest on the Obligations is at all times less than interest
      calculated at the Maximum Rate.

                                      -8-
<PAGE>
                                                                   Exhibit 10.42

            (d) Upon the occurrence of an Event of Default, Borrower shall, and
      shall cause each Guarantor to hold any payments which are received by
      Borrower or any Guarantor (including any payment evidenced by a promissory
      note or other instrument) in trust for Lender. Borrower shall, and shall
      cause each Guarantor to cause all such payments to be (i) deposited in the
      Collection Account, or (ii) delivered to Lender, as promptly as possible
      in the exact form received, together with any necessary endorsements.

            Section 6.3 Verification and Notification. Lender shall have the
      right at any time at Borrower's expense (a) to verify the validity, amount
      or any other matter relating to any accounts of Borrower or any Guarantor,
      and (b) to notify Account Debtors of Borrower and each Guarantor to make
      payment of all amounts directly to Lender and enforce collection of any
      such accounts and to adjust, settle or compromise the amount or payment
      thereof, in the same manner as Borrower and each Guarantor.

            Section 6.4 Disputes, Returns and Adjustments.

            (a) Borrower shall, and shall cause each Guarantor to provide Lender
      with prompt written notice of amounts in excess of $100,000 that are in
      dispute with respect to any accounts.

            (b) Borrower shall, and shall cause each Guarantor to notify Lender
      promptly of all returns and credits in respect of any account, which
      notice shall specify the accounts affected and be included in the
      Borrowing Base Certificate delivered to Lender in accordance with Section
      8.3(e). Borrower shall, and cause each Guarantor to notify Lender promptly
      of any pending return or credit in excess of $100,000, and shall specify
      the account affected, the related Account Debtor and the goods to be
      returned.

            (c) Borrower or any Guarantor may, in the ordinary course of
      business and prior to a Default or an Event of Default, grant any
      extension of time for payment of any account or compromise, compound or
      settle the same for less than the full amount thereof or release wholly or
      partly any Person liable for the payment thereof or allow any credit or
      discount whatsoever thereon; provided that (i) neither Borrower nor any
      Guarantor shall taken any such action that results in the reduction of
      more than five percent (5%) of the amount payable with respect to any
      account or of more than $25,000 with respect to all accounts of Borrower
      or Guarantor, as appropriate, in any fiscal year, and (ii) Borrower shall,
      and shall cause each Guarantor to promptly notify Lender (but not less
      often than ten (10) days after the end of each month) of the amount of
      such adjustments and the account(s) affected thereby.

            Section 6.5 Invoices. Upon request, Borrower shall, and shall cause
      each Guarantor to deliver to Lender, copies of customers' invoices or the
      equivalent, original shipping and delivery receipts or other proof of
      delivery, customers' statements, the original copy of all documents,
      including, without

                                      -9-
<PAGE>

                                                                   Exhibit 10.42

      limitation, repayment histories and present status reports, relating to
      accounts and such other documents and information relating to the accounts
      as Lender shall specify.

            Section 6.6 Ownership; Defense of Title.

            (a) Borrower shall, and shall cause each Guarantor to defend its
      title in and to the Collateral and shall defend the security interest of
      Lender in the Collateral against the claims and demands of all Persons.

            (b) Borrower shall, and shall cause each Guarantor to, (i) protect
      and preserve all properties material to its business, including
      Intellectual Property, and maintain all tangible property in good and
      workable condition in all material respects, with reasonable allowance for
      wear and tear, and (ii) from time to time make or cause to be made all
      needed and appropriate repairs, renewals, replacements and additions to
      such properties necessary for the conduct of its business.

            Section 6.7 Location of Offices and Collateral. Neither Borrower nor
      any Guarantor shall change the location of its place of business (or, if
      it has more than one place of business, its chief executive office) or the
      place where it keeps its books and records relating to the Collateral or
      change its name, identify or corporate structure without giving Lender at
      least thirty (30) days' prior written notice thereof. All inventory of
      Borrower, other than inventory in transit to any such location, and all
      equipment, other than motor vehicles, shall at all times be kept by
      Borrower at one of the locations set forth in Schedules 5.1(o) and (p).
      All inventory of each Guarantor, other than inventory in transit to any
      such location, and all equipment, other than motor vehicles, shall at all
      times be kept by such Guarantor at one of the locations set forth in the
      Schedule to the Security Agreement executed by such Guarantor.

            Section 6.8 Records Relating to Collateral.

            (a) Borrower shall, and shall cause each Guarantor to at all times
      keep and maintain (i) complete and accurate records of inventory on a
      basis consistent with past practices of Borrower or each Guarantor, as
      appropriate, itemizing and describing the kind, type and quantity of
      inventory of Borrower and each Guarantor, the cost therefor and a current
      price list for such inventory, (ii) complete and accurate records of all
      other Collateral, (iii) a list of all customers of each Borrower and each
      Guarantor, with names, addresses and phone numbers, (iv) a list of all
      distributors for each product line included in each of Borrower's or any
      Guarantor's inventory, (v) a current customer open order report against
      current inventory, and (vi) a current list of all salesmen and employees
      of each of Borrower and each Guarantor. Data bases containing the
      foregoing shall at all times be accessible and available to Lender.

                                      -10-
<PAGE>

                                                                   Exhibit 10.42

            (b) Borrower shall, and shall cause each Guarantor to conduct a
      physical count of all inventory, wherever located, at least annually and
      make adjustments to its books and records to reflect the findings of such
      count and such adjustments shall be immediately reported to Lender.

            Section 6.9 Inspection. Lender (by any of its officers, employees or
      agents) shall have the right at any time or times to (a) visit the
      properties of each of Borrower and each Guarantor, inspect the Collateral
      and the other assets of each of Borrower and each Guarantor and inspect
      and make extracts from the books and records of each of Borrower and each
      Guarantor, all during customary business hours, (b) discuss each of
      Borrower's and each Guarantor's business, financial condition, results of
      operations and business prospects with their respective, (i) principal
      officers, (ii) independent accountants and other professionals providing
      services to Borrower or any Guarantor, and (iii) any other Person (except
      that any such discussion with any third parties shall be conducted only in
      accordance with Lender's standard operating procedures relating to the
      maintenance of confidentiality of confidential information of borrowers),
      (c) verify the amount, quantity, value and condition of, or any other
      matter relating to, any of the Collateral and in this connection to
      review, audit and make extracts from all records and files related to any
      of the Collateral, and (d) access and copy the records, lists, reports and
      data bases referred to in Section 6.8. Borrower shall, and shall cause
      each Guarantor to deliver to the Lender upon request any instrument
      necessary to authorize an independent accountant or other professional to
      have discussions of the type outlined above with the Lender or for the
      Lender to obtain records from any service bureau maintaining records on
      behalf of Borrower or any Guarantor.

            Section 6.10 Maintenance. Borrower shall, and shall cause each
      Guarantor to maintain all equipment of Borrower and each Guarantor in good
      and working order and condition, reasonable wear and tear accepted.

            Section 6.11 Power of Attorney. Borrower and each Guarantor hereby
      appoints Lender as its attorney-in-fact, with power (a) to endorse the
      name of Borrower or any Guarantor, as appropriate, on any checks, notes,
      acceptances, money orders, drafts or other forms of payment or security
      that may come into Lender's possession, and (b) to sign the name of
      Borrower or any Guarantor, as appropriate, on any invoice or bill of
      lading relating to any accounts, inventory or other Collateral.

      2.7 Article VII of the Loan Agreement is hereby amended by the addition of
the following Sections:

            Section 7.15 Additional Guarantors. Borrower shall cause each new
      subsidiary, whether direct or indirect, to execute and deliver to Lender a
      Security Agreement and an Unlimited Guaranty.

            Section 7.16 Real Property.

                                      -11-
<PAGE>
                                                                   Exhibit 10.42

            (a) Borrower shall cause to be delivered to Lender on or before
      forty-five (45) days after the Fifth Modification Closing Date Appraisals
      of all the Real Property. Lender may require additional Appraisals of the
      Real Property at Borrower's expense.

            (b) On or before forty-five (45) days after the Fifth Modification
      Closing Date, Borrower shall cause to be delivered to Lender, in addition
      to the Appraisals pursuant to paragraph (a), the following, as to the Real
      Property:

               (i) Updates to prior environmental reports provided to Lender or,
            if none, new environmental reports to the satisfaction of Lender.

               (ii) If required by Lender, commitments from the title insurance
            companies that issued the lender's ALTA extended coverage title
            insurance policies, if any, in connection with the Deed of Trust and
            the IDS Deeds of Trust (collectively, the "Title Policies") to issue
            endorsements, in form satisfactory to Lender, to the Title Policies,
            or if there is no existing Title Policy, a new Title Policy, in form
            satisfactory to Lender, insuring that the Deed of Trust and the IDS
            Deeds of Trust, as modified hereby, continue to be first liens upon
            the real property described therein, as security of the Loans, as
            modified herein, subject only to those exceptions contained in the
            Title Policies and to such additional exceptions as Lender may
            specifically approve in writing.

2.8   Section 8.3 of the Loan Agreement is hereby amended to read as follows:

      Section 8.3 Collateral Information and Reports.

      (a) Schedules of Accounts. Within thirty (30) days after the end of each
month if there is an outstanding Revolving Loan balance and no later than five
(5) days prior to any advance, a Schedule of Accounts listing all accounts of
Borrower and each Guarantor as of the last business day of such month setting
forth (A) the name of each Account Debtor together with account balances
detailed by invoice number, amount (and any applicable rebate or discount),
invoice date and terms, (B) aging of all accounts setting forth its accounts of
Borrower and each Guarantor thirty (30) days past the invoice date or less,
accounts over thirty (30) days but less than sixty-one (61) days past the
invoice date, accounts over sixty (60) days but less than ninety-one (91) days
past the invoice date, accounts over ninety (90) days but less than one hundred
twenty-one (121) days past the invoice date and accounts over one hundred twenty
(120) days past the invoice date, and (C) a reconciliation of the Schedule of
Accounts to the Borrowing Base Certificate as of the most recent month end and
Borrower's and each Guarantor's general ledger as of such month end.

                                      -12-
<PAGE>
                                                                   Exhibit 10.42

      (b) Schedules of Accounts Payable. Within thirty (30) days after the end
of each month if there is an outstanding Revolving Loan balance and no later
than five (5) days prior to any advance, a statement of accounts payable of
Borrower and each Guarantor as of the last business day of such month setting
forth (A) a detailed aged trial balance of all of Borrower's and each
Guarantor's respective accounts payable, specifying the name of and the balance
due to each creditor, and (B) a reconciliation to the schedule of accounts
payable delivered in respect of the next preceding month.

      (c) Schedule of Inventory. Within thirty (30) days after the end of each
month if there is an outstanding Revolving Loan balance and no later than five
(5) days prior to any advance, (A) (i) a Schedule of Inventory, based upon
Borrower's and each Guarantor's perpetual inventory, as of the last business day
of such month, itemizing and describing the kind, type, quantity and location of
all inventory of Borrower and each Guarantor and the cost thereof with a summary
of inventory by category, (ii) a detailed statement of all inventory that is not
located on the premises described on Schedule 5.1(o), and (iii) an inventory
turnover report, in form and substance acceptable to Lender, and (B) a
reconciliation of the Schedule of Inventory to the Borrowing Base Certificate as
of the most recent month end and Borrower's and each Guarantor's general ledger
as of such month end

      (d) Borrowing Base Certificate. Within thirty (30) days after the end of
each month if there is an outstanding Revolving Loan balance and no later than
five (5) days prior to any advance, a Borrowing Base Certificate prepared as of
the close of business on the last business day of such week, along with
supporting documentation, in form and substance satisfactory to Lender
(including but not limited to information on sales, credit, collections,
adjustments and inventory changes).

      (e) Certification. Each of the schedules and certificates delivered to
Lender pursuant to this Section 8.3 shall be signed and certified by the
president, chief financial officer or treasurer of Borrower to be true, correct
and complete as of the date indicated thereon.

      (f) Other Information. Lender may, in its sole discretion, from time to
time require Borrower to deliver the schedules and certificates described in
Section 8.3 more or less often and on different schedules than specified in such
Section. Borrower shall also furnish to Lender such other additional information
as Lender may from time to time request.

2.9   Section 9.2 of the Loan Agreement is hereby amended to read as follows:

      Section 9.2 Capital Expenditures. Make or incur any Capital Expenditures,
except that Borrower may make or incur Capital Expenditures in any fiscal year
in an amount not to exceed, in the aggregate $15,000,000 in fiscal year 2003 and
$5,000,000 in any fiscal year thereafter.

                                      -13-
<PAGE>
                                                                   Exhibit 10.42

2.10     Schedules 5.1(i), 5.1(l), 5.1(o), 5.1(p) and 5.1(r) of the Loan
Agreement are hereby amended to read as attached hereto as Schedules 5.1(i),
5.1(l), 5.1(o), 5.1(p) and 5.1(r). Exhibit A of the Loan Agreement is hereby
amended to read as attached hereto as Exhibit A.

2.11     All references in the Loan Documents to "$8,000,000" or "Eight Million
and No/100 Dollars" with respect to the Revolving Loan and the Revolving Note
are hereby amended to read "$12,000,000" and "Twelve Million and No/100
Dollars," respectively.

2.12     The Note is hereby amended as follows:

            (a) "Total Principal Amount" is hereby amended from Eight Million
      and No/100 Dollars ($8,000,000.00) to Twelve Million and No/100 Dollars
      ($12,000,000.00).

            (b) "Maximum Rate" is hereby amended to read as follows:

               "Maximum Rate" shall mean the maximum nonusurious interest rate,
            if any, that at any time, or from time to time, may be contracted
            for, taken, reserved, charged, or received on the Loans under the
            laws which are presently in effect of the United States and the
            State of Arizona applicable to Bank and such indebtedness or, to the
            extent permitted by law, under such applicable laws of the United
            States or the State of Arizona which may hereafter be in effect and
            which allow a higher maximum nonusurious interest rate than
            applicable laws now allow. To the extent federal law permits Bank to
            contract for, charge or receive a greater amount of interest, Bank
            will rely on federal law, instead of the laws of the State of
            Arizona, for the purpose of determining the Maximum Rate.
            Additionally, to the maximum extent permitted by applicable law now
            or hereafter in effect, Bank may, at its option and from time to
            time, implement any other method of computing the Maximum Rate under
            the Act or under other applicable law by giving notice, if required,
            to Borrower as provided by applicable law now or hereafter in
            effect.

            (c) "Prime Rate" is hereby amended to read as follows:

               "Prime Rate" shall mean the per annum rate of interest publicly
            announced by Bank from time to time as its "prime or base rate." Any
            change in an interest rate resulting from a change in the Prime Rate
            shall become effective on the day such change is announced by Bank.
            The Prime Rate is a reference used by Bank in determining interest
            rates on certain loans and is not intended to be the lowest rate of
            interest charged on any extension of credit to any debtor.

            (d) Paragraph 4 of the Note is hereby amended to read as follows:

                                      -14-
<PAGE>
                                                                   Exhibit 10.42

               4. Rates of Interest. The unpaid principal of the Prime Rate
            Balance shall bear interest at a rate per annum which shall from day
            to day be equal to the lesser of (i) the Adjusted Prime Rate in
            effect from day to day, or (ii) the Maximum Rate. The unpaid
            principal of each LIBOR Balance shall bear interest at a rate per
            annum which shall from day to day be equal to the lesser of (i) the
            Adjusted LIBOR Rate for the Interest Period in effect with respect
            to such LIBOR Balance, or (ii) the Maximum Rate. Each change in the
            interest rate applicable to a Prime Rate Balance shall become
            effective without prior notice to Borrower automatically as of the
            day any change in the Prime Rate is announced by Bank. Interest on
            this Note shall be calculated on the basis of the actual days
            elapsed in a year consisting of 360 days.

      2.13 Each of the Loan Documents is modified to provide that it shall be a
default or an event of default thereunder if Borrower shall fail to comply with
any of the covenants of Borrower herein or if any representation or warranty by
Borrower herein or by any guarantor in any related Consent and Agreement of
Guarantors is materially incomplete, incorrect, or misleading as of the date
hereof.

      2.14 Each reference in the Loan Documents to any of the Loan Documents is
hereby amended to be a reference to such document as modified herein.

SECTION 3. RATIFICATION OF LOAN DOCUMENTS AND COLLATERAL.

      The Loan Documents are ratified and affirmed by Borrower and shall remain
in full force and effect as modified herein. Any property or rights to or
interests in property granted as security in the Loan Documents shall remain as
security for the Loan and the obligations of Borrower in the Loan Documents.

SECTION 4. BORROWER REPRESENTATIONS AND WARRANTIES.

      Borrower represents and warrants to Lender:

      4.1 No default or event of default under any of the Loan Documents as
modified herein, nor any event, that, with the giving of notice or the passage
of time or both, would be a default or an event of default under the Loan
Documents as modified herein has occurred and is continuing.

      4.2 There has been no material adverse change in the financial condition
of Borrower or any other person whose financial statement has been delivered to
Lender in connection with the Loan from the most recent financial statement
received by Lender.

      4.3 Each and all representations and warranties of Borrower in the Loan
Documents are accurate on the date hereof.

                                      -15-
<PAGE>
                                                                   Exhibit 10.42

      4.4 Borrower has no claims, counterclaims, defenses, or set-offs with
respect to the Loan or the Loan Documents as modified herein.

      4.5 The Loan Documents as modified herein are the legal, valid, and
binding obligation of Borrower, enforceable against Borrower in accordance with
their terms.

      4.6 Borrower is validly existing under the laws of the State of its
formation or organization and has the requisite power and authority to execute
and deliver this Agreement and to perform the Loan Documents as modified herein.
The execution and delivery of this Agreement and the performance of the Loan
Documents as modified herein have been duly authorized by all requisite action
by or on behalf of Borrower. This Agreement has been duly executed and delivered
on behalf of Borrower.

SECTION 5. BORROWER COVENANTS.

      Borrower covenants with Lender:

      5.1 Borrower shall execute, deliver, and provide to Lender such additional
agreements, documents, and instruments as reasonably required by Lender to
effectuate the intent of this Agreement.

      5.2 Borrower fully, finally, and absolutely and forever releases and
discharges Lender and its present and former directors, shareholders, officers,
employees, agents, representatives, successors and assigns, and their separate
and respective heirs, personal representatives, successors and assigns, from any
and all actions, causes of action, claims, debts, damages, demands, liabilities,
obligations, and suits, of whatever kind or nature, in law or equity of
Borrower, whether now known or unknown to Borrower, and whether contingent or
matured, (i) in respect of the Loan, the Loan Documents, or the actions or
omissions of Lender in respect of the Loan or the Loan Documents and (ii)
arising from events occurring prior to the date of this Agreement.

SECTION 6. CONDITIONS PRECEDENT.

      The agreements of Lender and the modifications contained herein shall not
be binding upon Lender until Lender has executed and delivered this Agreement
and Lender has received, at Borrower's expense, all of the following, all of
which shall be in form and content satisfactory to Lender and shall be subject
to approval by Lender:

      6.1 An original of this Agreement fully executed by the Borrower, the
Original Guarantors, IDSI and IDSA.

      6.2 If and when Borrower requests any advance under the Term Note, an
original of the Term Note fully executed by the Borrower.

      6.3 Security Agreements and Unlimited Guaranties fully executed by IDSI
and IDSA.

      6.4 A completed Borrowing Base Certificate indicating that Borrower, after
giving effect to the Merger, is in compliance with Section 2.3 of the Loan
Agreement.

                                      -16-
<PAGE>
                                                                   Exhibit 10.42

      6.5 A modification of the Deed of Trust fully executed by the Borrower.

      6.6 UCC searches as to IDSI and IDSA.

      6.7 A copy of the final Merger documents.

      6.8 Modifications of the deed of trust granted by IDSI and the mortgage
granted by IDSA for the benefit of Lender with respect to the real property
owned by IDSI and IDSA (together, the "IDS Deeds of Trust").

      6.9 If Borrower or any Guarantor is a corporation, limited liability
company, partnership or trust, such resolutions or authorizations and such other
documents as Lender may require relating to the existence and good standing of
that corporation, partnership or trust, and the authority of any person
executing this Agreement or other documents on behalf of that corporation,
limited liability company, partnership or trust.

      6.10 Payment of all the internal and external costs and expenses incurred
by Lender in connection with this Agreement (including, without limitation,
inside and outside attorneys, appraisal, appraisal review, processing, title,
filing, and recording costs, expenses, and fees).

SECTION 7. INTEGRATION, ENTIRE AGREEMENT, CHANGE, DISCHARGE, TERMINATION, OR
           WAIVER.

         The Loan Documents as modified herein contain the complete
understanding and agreement of Borrower and Lender in respect of the Loan and
supersede all prior representations, warranties, agreements, arrangements,
understandings, and negotiations. No provision of the Loan Documents as modified
herein may be changed, discharged, supplemented, terminated, or waived except in
a writing signed by the parties thereto.

SECTION 8. BINDING EFFECT.

      The Loan Documents as modified herein shall be binding upon and shall
inure to the benefit of Borrower and Lender and their successors and assigns and
the executors, legal administrators, personal representatives, heirs, devisees,
and beneficiaries of Borrower; provided, however, Borrower may not assign any of
its right or delegate any of its obligation under the Loan Documents and any
purported assignment or delegation shall be void.

SECTION 9. CHOICE OF LAW.

      This Agreement shall be governed by and construed in accordance with the
laws of the State of Arizona, without giving effect to conflicts of law
principles.

                                      -17-
<PAGE>
                                                                   Exhibit 10.42

SECTION 10. COUNTERPART EXECUTION.

      This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one and
the same document. Signature pages may be detached from the counterparts and
attached to a single copy of this Agreement to physically form one document.

      DATED as of the date first above stated.

                                WHITE ELECTRONIC DESIGNS CORPORATION, an Indiana
                                corporation

                                By:
                                   ---------------------------------------------
                                Name:   Hamid R. Shokrgozar
                                     -------------------------------------------
                                Title:  President and CEO
                                      ------------------------------------------

                                                                        BORROWER

                                BANK ONE, NA, a national
                                banking association with
                                its main office in Chicago,
                                Illinois, successor by
                                merger to Bank One, Texas,
                                N.A.

                                By:
                                   ---------------------------------------------
                                Name:  Christine Nowaczyk
                                     -------------------------------------------
                                Title:   Vice President
                                      ------------------------------------------

                                                                          LENDER

                                      -18-
<PAGE>

                                                                   Exhibit 10.42

                       CONSENT AND AGREEMENT OF GUARANTORS

      With respect to the Fifth Modification Agreement, dated March 13, 2003
("Agreement"), between WHITE ELECTRONIC DESIGNS CORPORATION, an Indiana
corporation ("Borrower"), and BANK ONE, NA, a national banking association with
its main office in Chicago, Illinois, successor by merger to Bank One, Texas,
N.A. ("Lender"), the undersigned (individually and, if more than one,
collectively "Guarantor") agrees for the benefit of Lender as follows:

      1. Guarantor acknowledges (i) receiving a copy of and reading the
Agreement, (ii) the accuracy of the Recitals in the Agreement, and (iii) the
effectiveness of (A) the Guarantee Agreements as modified herein, and (B) any
other agreements, documents, or instruments securing or otherwise relating to
the Guarantee Agreements (including, without limitation, any arbitration
resolution and any environmental certification and indemnity agreement
previously executed and delivered by the undersigned) and the Security Documents
delivered by Guarantor (the "Security Agreements"), as modified herein. The
Guarantee Agreements, the Security Agreements and such other agreements,
documents, and instruments, as modified herein, are referred to individually and
collectively as the "Guarantor Documents."

      2. Guarantor consents to the modification of the Loan Documents and all
other matters in the Agreement. In addition, each Guarantor hereby agrees,
respectively, that the Guarantee Agreement and Security Agreement delivered by
it for the benefit of Lender are hereby amended to include among other things
any additional indebtedness incurred by Borrower pursuant to the Agreement,
including without limitation any Rate Management Transaction, for purposes of
the description of the indebtedness guaranteed and secured thereby.

      3. Guarantor fully, finally, and forever releases and discharges Lender
and its successors, assigns, directors, officers, employees, agents, and
representatives from any and all actions, causes of action, claims, debts,
demands, liabilities, obligations, and suits of whatever kind or nature, in law
or equity, that Guarantor has or in the future may have, whether known or
unknown, (i) in respect of the Loan, the Loan Documents, the Guarantor
Documents, or the actions or omissions of Lender in respect of the Loan, the
Loan Documents, or the Guarantor Documents and (ii) arising from events
occurring prior to the date hereof.

      4. Guarantor agrees that all references, if any, to the Note, the Loan
Agreement, the Deed of Trust, the Security Documents, and the Loan Documents in
the Guarantor Documents shall be deemed to refer to such agreements, documents,
and instruments as modified by the Agreement.

      5. Guarantor reaffirms the Guarantor Documents and agrees that the
Guarantor Documents continue in full force and effect and remain unchanged,
except as specifically modified by this Consent and Agreement of Guarantors. Any
property or rights to or interests in property granted as security in the
Guarantor Documents shall remain as security for the Guarantee Agreements and
the obligations of Guarantor in the Guarantee Agreements.

      6. Guarantor agrees that the Loan Documents, as modified by the Agreement,
and the Guarantor Documents, as modified by this Consent and Agreement of
Guarantors, are the

<PAGE>
                                                                   Exhibit 10.42

legal, valid, and binding obligations of Borrower and the undersigned,
respectively, enforceable in accordance with their terms against Borrower and
the undersigned, respectively.

      7. Guarantor agrees that Guarantor has no claims, counterclaims, defenses,
or offsets with respect to the enforcement against Guarantor of the Guarantor
Documents.

      8. Guarantor represents and warrants that there has been no material
adverse change in the financial condition of any Guarantor from the most recent
financial statement received by Lender.

      9. Guarantor waives and agrees not to assert with respect to the Guarantor
Documents: (a) any right to require Lender to proceed against Borrower or any
other guarantor, to proceed against or exhaust any security for the
indebtedness, to pursue any other remedy available to Lender, or to pursue any
remedy in any particular order or manner; (b) demand, diligence, presentment for
payment, protest and demand, and notice of extension, dishonor, protest, demand,
nonpayment and acceptance of the Guarantee Agreements; (c) notice of the
existence, creation or incurring of new or additional indebtedness of Borrower
to Lender; (d) the benefits of any statutory provision limiting the liability of
a surety, including without limitation the provisions of A.R.S. Sections
12-1641, et seq.; (e) any defense arising by reason of any disability or other
defense of Borrower or by reason of the cessation from any cause whatsoever
(other than payment in full) of the liability of Borrower for the indebtedness;
and (f) the benefits of any statutory provision limiting the right of Lender to
recover a deficiency judgment, or to otherwise proceed against any person or
entity obligated for payment of the indebtedness, after any foreclosure or
trustee's sale of any security for the indebtedness.

      10. Guarantor agrees that the Guarantor Documents are hereby modified to
provide that they shall be governed by and construed in accordance with the laws
of the State of Arizona, without giving effect to conflicts of law principles.

      11. Guarantor agrees that this Consent and Agreement of Guarantors may be
executed in one or more counterparts, each of which shall be deemed an original
and all of which together shall constitute one and the same document. Signature
and acknowledgement pages may be detached from the counterparts and attached to
a single copy of this Consent and Agreement of Guarantors to physically form one
document.

      DATED as of the date of the Agreement.

                        ELECTRONIC DESIGNS, INC., a Delaware corporation

                        By:
                           -----------------------------------------------------
                        Name:  Hamid R. Shokrgozar
                             ---------------------------------------------------
                        Title:    President & CEO
                              --------------------------------------------------

                                      -2-
<PAGE>
                                                                   Exhibit 10.42

                        PANELVIEW, INCORPORATED, an Oregon corporation

                        By:
                           -----------------------------------------------------
                        Name:  Hamid R. Shokrgozar
                             ---------------------------------------------------
                        Title:    President
                              --------------------------------------------------

                        INTERFACE DATA SYSTEMS, INC., an Arizona corporation

                       By:
                          ------------------------------------------------------
                       Name:  Hamid R. Shokrgozar
                            ----------------------------------------------------
                       Title:    President
                             ---------------------------------------------------

                       IDS ACQUISITION CORPORATION, an Arizona corporation

                       By:
                          ------------------------------------------------------
                       Name:  Hamid R. Shokrgozar
                            ----------------------------------------------------
                       Title:    President
                            ----------------------------------------------------

                                                                       GUARANTOR

                                      -3-
<PAGE>

                                                                   Exhibit 10.42

                                 SCHEDULE 5.1(I)

                                   LITIGATION

None

                                      -4-
<PAGE>

                                                                   Exhibit 10.42

                                 SCHEDULE 5.1(L)

                                      ERISA

401K - White Electronic Designs 401K Plan
Plan #777068
Aetna Retirement Services
151 Farmington Avenue

Hartford, CT  06150-7750

PENSION PLAN - Revised Pension Pan for Bargaining Unit Employees
At its Fort Wayne, Indiana Plant

Administrator:       White Electronic Designs
                     8000 Bluffton Road
                     Fort Wayne, IN  46809

Administrating Bank: Bank One
                     PO Box 6167
                     IN1-0118
                     Indianapolis, IN  46206-6167

                     Account 2835551910

MEDICAL INSURANCE
Aetna 256843

7720 North 16th Street, Suite 400
                                            Phoenix, AZ 85020-4402

                                      -5-
<PAGE>

                                                                   Exhibit 10.42

                                 SCHEDULE 5.1(O)

                             LOCATIONS OF INVENTORY

          Hi-Reliability Products Division
          3601 E. Univrsity Drive
          Phoenix, AZ  85034

          Amertron Inc.
          Km. 17, West Service Road
          South Superhighway
          Paranaque, Philippines

          Commercial Products Division
          410 Forest Street
          Marlborough, MA  01752

          Display Products Division
          8000 Bluffton Road
          Fort Wayne, IN  46809

          Display Products Division
          21333 NW Jacobson Road
          Hillsboro, Oregon  97124

          Interface Data Systems
          3333 W. Flower Street
          Phoenix, AZ  85017

          Interface Data Systems
          539 Industrial Mile Road
          Columbus, OH  43228

                                       -6-
<PAGE>

                                                                   Exhibit 10.42
                                 SCHEDULE 5.1(P)

                             LOCATIONS OF EQUIPMENT

                 High-Reliability Products Division
                 3601 E. University Drive
                 Phoenix, AZ  85034

                 Commercial Products Division
                 410 Forest Street
                 Marlborough, MA  01752

                 Display Products Division
                 8000 Bluffton Road
                 Fort Wayne, IN  46809

                 Display Products Division
                 21333 NW Jacobson Road
                 Hillsboro, Oregon  97124

                 Interface Data Systems
                 3333 W. Flower Street
                 Phoenix, AZ  85017

                 Interface Data Systems
                 539 Industrial Mile Road
                 Columbus, OH  43228

                                      -7-
<PAGE>

                                                                   Exhibit 10.42

                                 SCHEDULE 5.1(R)

                         CORPORATE AND FACILITIES NAMES

         White Electronic Designs Corp.
         Electronic Designs Inc.
         Panelview, Incorporated
         Interface Data Systems, Inc.

                                      -8-
<PAGE>

                                                                   Exhibit 10.42

                                   EXHIBIT "A"

                         BORROWING BASE CERTIFICATE FOR
                                  PERIOD ENDING

                                           , 20
                              -------------    ---
                              ("REPORTING PERIOD")

Bank One, NA
Post Office Box 71
Phoenix, Arizona  85001

Attn:    Commercial Banking AZ1-1178                        Date:
                                                                 ---------------

Dear Ladies and Gentlemen:

      This Borrowing Base Certificate refers to the Loan and Security Agreement
dated as of January 7, 2000 (as it may hereafter be amended, modified, extended
or restated from time to time, the "Loan Agreement"), between White Electronic
Designs Corporation, an Indiana corporation ("Borrower"), and Bank One, NA,
successor by merger to Bank One, Texas, NA, a national banking association.
Capitalized terms used and not otherwise defined herein shall have the meanings
assigned to such terms in the Loan Agreement.

      Pursuant to Section 8.3(d) of the Loan Agreement, the undersigned, an
authorized officer of Borrower, hereby certifies that as of the last day of the
Reporting Period, the computations below were true and correct:
<TABLE>
<S>                                                                                                        <C>

Total Accounts Receivable (Borrower and all Guarantors)                                                    $_________
a.       Less:  Over 90 days past due amount
b.       Less:  Not due and payable within 30 days
c.       Less:  Account Debtor if 20% or more ineligible per a and b
d.       Less:  Related Accounts
e.       Less:  Conditional Accounts
f.       Less:  Uninsured foreign accounts/no letter of credit
g.       Less:  Certain Government Accounts
h.       Less:  Subject to offset, etc.
i.       Less:  Not shipped
j.       Less:  Not invoiced within 5 days
k.       Less:  Subject to other Liens (other than Permitted Liens) or not perfected
l.       Less:  15% Account Debtor Excess
m.       Less:  Ineligible per Lender
Total Eligible Accounts

Margin                                                                                                            80%

I.       Borrowing Potential on Accounts Receivable                                                        $_________

</TABLE>

                                      -9-
<PAGE>

                                                                   Exhibit 10.42
<TABLE>
<S>                                                                                                        <C>

Total Inventory (Borrower and all Guarantors)
a.       Less: Work in process
b.       Less: Out of spec
c.       Less: Not acceptable to Lender
d.       Less: Not first perfected lien
e.       Less: Subject to other Lien (other than Permitted Liens)
f.       Less: Packaging, shipping materials
g.       Less: Obsolete, returned, repossessed, used
h.       Less: Violates Fair Labor Standards Act
i.       Less: Located outside of secure locations

Total Eligible Inventory

Total Eligible Inventory - finished goods                                                                  $_________
Margin                                                                                                            50%

II.      Potential Finished Goods

Total Eligible Inventory - raw materials                                                                   $_________
Margin                                                                                                            25%

III.     Potential Raw Materials                                                                           $_________

IV.      Total of II and III                                                                               $_________
Amount outstanding against Eligible Accounts                                                               $_________
         Less Reserves                                                                                    ($________)

V.       Net of outstanding amount less Reserves                                                           $_________

VI.      Least of IV, V or $4,000,000.00                                                                   $_________

Total Borrowing Potential (Sum of I+VI)                                                                    $_________

Total Revolving Loan Commitment                                                                            $12,000,000
Outstanding Balance on Revolving Loan

Excess <Deficit> Borrowing Potential (versus lesser of Borrowing Potential or Commitment)                  $_________
</TABLE>

                         WHITE ELECTRONIC DESIGNS CORPORATION

                         By:
                            ----------------------------------------------------
                         Name:
                              --------------------------------------------------
                         Its:
                             ---------------------------------------------------

                                      -10-

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