Seven Fields Development Co Watch

from 10KSB/A 1 page [Description] Exhibit PNC Bank, Na Fox Chapel Office 1105 Freeport Road Pittsburgh, Pa 15238 January 13, 1997 Mr. Roman Polnyi Chief Financial Officer Seven Fields Development Co. 2200 Garden Drive Suite 200 Mars, Pa 16046-7846 Dear Mr. Polnyj: This Letter Is Intended to Clarify and Amend Both the "Minimum Tangible Net Worth" and "Prohibition Against Additional Indebtedness" Loan Covenants Contained in the Following Commercial Loans: Account Number 9127059-00018 9127059-00026 Original Amount $1,700,000.00 $ 750,000.00 Dated 10/28/94 12/13/95 First the Loan Covenants Established Are Intended to Spread Across All Loans and Lines of Credit. Second, on December 14, 1994, We Amended the Minimum Tangible Net Worth Covenant to Provide for the Amount to Decline From $12,425,000 to $11,000,000.00 During the Fiscal Year. However at Fiscal Year End, It Would Be Required to Return to $12,425,000 or Greater. Third, We Hereby Further Amend the Minimum Tangible Net Worth Covenant Applicable to All Outstanding Loans and Lines of Credit Effective December 5, 1996 as Follows: Both Seven Fields Development Co. (Borrower) and Seven Fields (Pa) Inc. (Guarantor) Will Maintain at All Times a Minimum Tangible Net Worth of $10,000,000.00. Tangible Net Worth Means Tangible Net Worth Plus General Unsecured Subordinated Debt Less the Deferred Tax Asset. PNC Bank Hereby Waives the Fact That the Covenant May Have Been Below the Established Threshold During the Company's Last Fiscal Year. Finally, We Hereby Amend the Covenant for a Prohibition Against Additional Indebtedness to Apply Only to Loans for Land Development Uses Only. Again, This Provision Will Be Applicable to All Loans and Lines of Credit. I Believe That This Letter Should Cover All the Issues We Discussed Recently. if I Have Omitted Anything, or There Are Any Questions, Please Telephone Me at 7813252. Sincerely, Robert C. Foley Robert C. Foley Vice President