MOORE HANDLEY INC /DE/
AMENDMENT TO FINANCING AGREEMENT
<DOCUMENT>
<TYPE>EX-10.16
<SEQUENCE>3
<FILENAME>g75037ex10-16.txt
<DESCRIPTION>AMENDMENT TO FINANCING AGREEMENT
<TEXT>
<PAGE>

                                                                   EXHIBIT 10.16

The CIT Group/Business Credit, Inc.
1200 Ashwood Parkway
Suite 150
Atlanta, GA 30338
770 522-7672

March 10, 2000

MOORE-HANDLEY, INC.
3140 Pelham Parkway
Pelham, AL 35124

Gentlemen:

Reference is made to the Financing Agreement between us dated August 7, 1997, as
supplemented and amended (the "Financing Agreement"). Capitalized terms used and
not otherwise defined herein shall have the same meanings given them in the
Financing Agreement.

You have requested that we (i) increase the Line of Credit to $24,000,000.00,
(ii) establish a sub-line within the Line of Credit for advances against
Eligible Inventory (as further set forth in the Inventory Security Agreement of
even date herewith) and (iii) extend the term of the Financing Agreement to
August 7, 2002, and we have agreed to such amendment subject to, and in
accordance with the terms, provisions and conditions hereof:

Effective immediately, pursuant to mutual agreement, the Financing Agreement
shall be, and hereby is, amended as follows:

1.       The definitions of "early Termination Date" and "Early Termination Fee"
         (as set forth in Section 1 of the Financing Agreement) shall be, and
         each hereby is amended by changing the references therein to "third
         Anniversary Date" to fifth Anniversary Date";

2.       The definition of "Line of Credit" (as set forth in Section 1 of the
         Financing Agreement" shall be, and hereby is amended by increasing the
         $20,000,000.00 amount as set forth therein to $24,000,000.00; and

3.       Section 11 of the Financing Agreement shall be, and hereby is amended
         by changing all references "third Anniversary Date" in the first and
         fourth sentences thereof to read "fifth Anniversary Date".

In addition, we will make advances against Eligible Inventory to you within the
Line of Credit subject to and in accordance with the terms, provisions,
conditions and limitations set forth in the Inventory Security Agreement.

This Amendment shall be effective as of the date hereof upon the satisfaction of
the following conditions precedent:

1.       receipt by CITBC of (i) a manually signed original copy of this
         Amendment, Inventory Security Agreement and all other related documents
         thereto duly executed and delivered by all parties hereto, and (ii) the
         execution and delivery to CITBC of any other documentation reasonably
         requested by CITBC (all of which shall be acceptable to CITBC in its
         discretion);

2.       The absence of (x) any Default and/or Event of Default and (y) any
         material adverse change in the financial condition, business,
         prospects, profitability, assets or operations of the Company;

3.       CITBC's receipt of a secretary's certificate certifying Board of
         Directors Resolutions authorizing the execution, delivery and
         performance by the Company of this agreement and all documents and
         transactions contemplated hereby; and


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<PAGE>

4.       Payment by the Company of (i) any Out-of-Pocket Expenses incurred by
         CITBC with respect to the preparation, execution, filing of any
         financing statements and delivery of this Amendment, and (ii) in
         consideration of the preparation by CITBC's in house legal department
         of this Amendment, a Documentation Fee equal to $1,000.00. All such
         amounts may, at CITBC's option, be charged to Revolving Loan Account
         under the Financing Agreement.

Except as set forth above no other changes in the terms and provisions of the
Financing Agreement are intended or implied. If the foregoing is in accordance
with your understanding of our agreement kindly so indicate by signing and
returning to us the enclosed copy of the letter.

Very truly yours,

THE CIT GROUP/BUSINESS CREDIT, INC.



By:
   ---------------------------------
Name:
Title

Read and Agreed to:

MOORE-HANDLEY, INC.



By:
   ---------------------------------
Name:
Title


                                      B-38
<PAGE>


The CIT Group/Business Credit, Inc.
1200 Ashwood Parkway
Suite 150
Atlanta, GA 30338
770 522-7672

March 10, 2000

MOORE-HANDLEY, INC.
3140 Pelham Parkway
Pelham, AL 35124

INVENTORY SECURITY AGREEMENT

Ladies and Gentlemen:

This agreement is being executed by you to induce us to make loans or advances
to you and to induce us to enter into or continue a financing arrangement with
you, and is executed in consideration of our doing or having done any of the
foregoing. Capitalized terms used herein and defined in the Financing Agreement
between as dated August 7, 1997, as amended (the "Financing Agreement") shall
set forth therein unless otherwise specifically defined herein.

         1.       ADVANCES

1.1      Within the Line of Credit and so long as no Default or Even of Default
         has occurred under the Financing Agreement, we will make advances to
         you from time to time of up to fifty percent (50%) of the value of your
         Eligible Inventory (as hereinafter defined) calculated on the basis of
         the lower of cost or market, with cost calculated on a first in - first
         out basis, provided that in no event shall advances against Eligible
         Inventory exceed $6,000,000.00 in the aggregate at any one time
         outstanding. Eligible Inventory shall mean the gross amount of your
         Inventory (as hereinafter defined) that is subject to a valid,
         exclusive, first priority and fully perfected security interest in our
         favor and which Inventory at all times continues to be acceptable to us
         in our reasonable business judgement and less any (a) work-in-process,
         (b) supplies, other than raw material, (c) Inventory not present in the
         United States of America, (d) Inventory returned or rejected by your
         customers other than goods that are undamaged and resalable in the
         normal course of business, (e) Inventory to be returned to your
         suppliers, (f) Inventory in transit to third parties (other than you
         agents or warehouses), (g) Inventory in possession of a warehouseman,
         bailee or other third party, unless such warehouseman, bailee or third
         party has executed a notice of security interest agreement (in form and
         substance satisfactory to us) and we have taken all other action
         required by us in our reasonable discretion, including for special
         order goods, discontinued, slow-moving and obsolete Inventory, market
         value declines, bill and hold (deferred shipment), consignment sales
         and shrinkage.

1.2      Such loan and advances made or to be made by us to you, and the period
         of time during which they are to remain outstanding shall at all times
         by subject to the terms, provisions and conditions of the Financing
         Agreement, and shall constitute Revolving Loans and Obligations
         thereunder. The valuation and acceptability of the Eligible Inventory
         is to be determined exclusively by us.

1.3      Nothing contained herein shall be construed as limiting or modifying,
         in any way, any of our rights under the Financing Agreement including
         but not limited to our right to hold any reserve we deem necessary as
         security for payment and performance of your Obligations.

         2.       GRANT OF SECURITY INTEREST

2.1      As security for the prompt payment in full of all indebtedness,
         liabilities and/or obligations due by you from time to time to us,
         hereunder and under the Financing Agreement (herein the


                                      B-39
<PAGE>

         "Obligations"), you hereby pledge and grant to us a continuing general
         lien upon, and security interest in (herein "Security Interest"), the
         following described "Inventory":

         All present and hereafter acquired merchandise, inventory and goods,
         and all additions, substitutions and replacements thereof, wherever
         located, together with all goods and materials used or usable in
         manufacturing, processing, packaging or shipping same; in all stages of
         production - from raw materials through work-in-process to finished
         goods - and all proceeds of whatever sort.

2.2      The Security Interest in the Inventory shall extend and attach to:

(a)      All Inventory which is presently in existence and which is owned by you
         or in which you have any ownership interest, and all Inventory which
         you may purchase or in which you may acquire any ownership interest at
         any time and from time to time in the future, whether such Inventory is
         in transit or in your or our constructive, actual or exclusive
         possession, or is held by others for your account;

(b)      All Inventory wherever located, including, without limitation, all
         Inventory which may be located on your premises or upon the premises of
         any carriers, forwarding agents, truckers, warehousemen, vendors,
         selling agents, finishers, converters, processors, or other third
         persons who may have possession of the Inventory; and

(c)      All Inventory and any portion thereof which may be returned, rejected,
         reclaimed or repossessed by either of us from your customers, as well
         as to all supplies, goods, incidentals, packaging materials, and any
         other items which contribute to the finished goods or products
         manufactured or processed by you, or to the sale, promotion or shipment
         thereof.

         3.       OBLIGATIONS SECURED

         The Security Interest granted hereunder and any lien or security
interest that we now or hereafter have in any of your other assets, collateral
or property, secure the payment and performance of all of your now existing and
future Obligations to us, whether absolute or contingent, whether arising under
the Financing Agreement, this agreement or any other agreement or arrangement
between us, by operation of law or otherwise, including indebtedness arising
under any guaranty, credit enhancement or other credit support granted by us in
your favor, including any accommodation extended with respect to applications
for letters of credit, our acceptance of drafts or our endorsement of notes or
other instruments for your account and benefit. Obligations shall also include,
without limitation, all interest, commissions, financing and service charges,
and expenses and fees chargeable to and due from you under this agreement, the
Financing Agreement or any other agreement or arrangement which may be now or
hereafter entered into between us.

         4.       REPRESENTATIONS, WARRANTIES AND COVENANTS

4.1.1    You agree to safeguard, protect and hold all Inventory for our account
         and make no disposition thereof except in the regular course of your
         business as herein provided. You represent and warrant that Inventory
         will be sold and shipped by you to your customers only in the ordinary
         course of your business and then only on open account and on terms not
         exceeding the terms currently being extended by you to your customers,
         provided that all proceeds of all sales (including cash, accounts
         receivable, checks, notes, instruments for the payment of money and
         similar proceeds) are forthwith transferred, assigned, endorsed, and
         turned over and delivered to us. Invoices covering sales of Inventory
         are to be assigned to us in accordance with the provisions of the
         Agreement, and the proceeds thereof (if collected by you) are to be
         turned over to us in accordance with the provisions of the Agreement.
         Consignment sales or sales in which a lien upon or security interest in
         the Inventory is retained by you shall only be made by you with our
         written approval, and all proceeds of such sales shall not be
         commingled with your other property, but shall be segregated, held by
         you in trust for us as our exclusive property, and shall be delivered
         immediately by you to us in the identical form received by you. Upon
         the sale, exchange, or other disposition of the Inventory, as herein
         provided, the Security Interest provided for herein shall, without
         break in continuity and without further formality or act, continue in,
         and attach to, all proceeds, including any instruments for the payment
         of money, accounts receivable, contract rights, documents of title,
         shipping documents, chattel paper and all other cash and non-cash
         proceeds of such sale, exchange or disposition. As to any such sale,
         exchange or other disposition, we shall have all of the rights of an
         unpaid seller, including stopping in transit, replevin, rescission and
         reclamation.


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<PAGE>

4.2      You hereby warrant and represent that you are solvent; that this
         Security Interest constitutes and shall at all times constitute a first
         and only lien on the Inventory; that you are, or will be at the time
         additional Inventory is acquired by you, the absolute owner of the
         Inventory with full right to pledge, sell, consign, transfer and create
         a Security Interest therein, free and clear of any and all claims or
         liens in favor of others; that you will at your expense forever warrant
         and, at our request, defend the same from any and all claims and
         demands of any other person; and that you will not grant, create or
         permit to exist, any lien upon or security interest in the Inventory,
         or any proceeds, in favor of any other person.

4.3      You agree to comply with the requirements of all state and federal laws
         in order to grant to us a valid and perfected first Security Interest
         in the Inventory. We are hereby authorized by you to file any financing
         statements or amendments covering the Inventory whether or not your
         signature appears thereon. To the extent permitted by applicable law,
         you authorize us to sign your name, or to file financing statements or
         amendments without your signature, all in order to create, perfect or
         maintain our security interest n the Inventory. You agree to do
         whatever we may request, from time to time, by way of; leasing
         warehouses; filing notices of lien, financing statements, amendments,
         renewals and continuations thereof; cooperating with our agents and
         employees; keeping Inventory records; obtaining waivers from landlords
         and mortgagees; and performing such further acts as we may require in
         order to effect the purposes of this agreement.

4.4      You agree to maintain insurance on the Inventory under such policies of
         insurance, with such insurance companies, in such amounts and covering
         such risks as are at all times satisfactory to us. All policies
         covering the Inventory are to be made payable to us, in case of loss,
         under a standard non-contributory "mortgagee", "lender" or "secured
         party" clause and are to contain such other provisions as we may
         require to fully protect our interest in the Inventory and to any
         payments to be made under such policies. All original policies or true
         copies thereof are to be delivered to us, premium prepaid, with the
         loss payable endorsement in our favor, and shall provide for not less
         than thirty (30) days prior written notice to us of the exercise of any
         right of cancellation. At your request, or if you fail to maintain such
         insurance, we shall arrange for such insurance, but at your expense and
         without any responsibility on our part for: obtaining the insurance,
         the solvency of the insurance companies, the adequacy of the coverage,
         or the collection of claims. The insurance we purchase may not pay any
         claims made by you or against you in connection with your Inventory.
         You are responsible for the costs of this insurance, including interest
         and any other charges we may impose in connection with the purchase of
         this insurance. The costs of this insurance may be more than insurance
         you can buy on your own. You may still obtain insurance of your own
         choosing, subject to the terms and conditions of this paragraph 4.4, on
         the Inventory. If you provide us with proof that you have obtained
         adequate insurance on your Inventory, we will cancel the insurance that
         we purchased and refund or credit any unearned premiums to you. In the
         event that we purchase such insurance, we will notify you of said
         purchase within thirty (30) days after the date of such purchase. If,
         within thirty (30) days after the date notice was sent to you, you
         provide us with proof that you had adequate insurance on your Inventory
         as of the date we also purchased insurance and that you continue to
         have the insurance that you purchased yourself, we will cancel the
         insurance that we purchased without charging you any costs, interest,
         or other charges in connection with the insurance that we purchased.
         Unless we shall otherwise agree with you in writing, we shall have the
         sole right, in our name or yours, to file claims under any insurance
         policies, to receive receipt and give acquittance for any payments that
         may be payable thereunder, and to execute any and all endorsements,
         receipts, releases, assignments, reassignments or other documents that
         may be necessary to effect the collection, compromise or settlement of
         any claims under any such insurance policies.

4.5      You agree to pay, when due, all taxes assessments, claims and other
         charges (herein "taxes") lawfully levied or assessed upon the Inventory
         unless such taxes are being diligently contested in good faith by you
         by appropriate proceedings and adequate reserves are established in
         accordance with GAAP. Notwithstanding the foregoing, if such taxes
         remain unpaid after the date fixed for the payment thereof, and a lien
         therefore shall be claimed which in our opinion might create a valid
         obligation having priority over the rights granted to us herein, we may
         then, without notice to you, on your behalf, pay such taxes, and the
         amount thereof shall be an Obligation secured hereby and due to us on
         demand.

4.6      Any and all fees, costs and expenses, of whatever kind and nature,
         (including any taxes, attorneys' fees or costs for insurance of any
         kind), which we may incur in filing public notices; in preparing or
         filing documents, making title examinations; in protecting,
         maintaining, or preserving the Inventory; in enforcing or foreclosing
         the Security Interest hereunder, whether through judicial procedures or
         otherwise; or in defending or prosecuting any actions or


                                      B-41
<PAGE>

         proceedings arising our of or related to our transactions with you
         under this arrangement, shall be borne and paid by you. If same are not
         promptly paid by you, we may pay same on your behalf, and the amount
         thereof shall be an Obligation secured hereby and due to us on demand.

4.7      You agree to comply with all acts, rules, regulations, and orders of
         any legislative, administrative or judicial body or official,
         applicable to the Inventory or any part thereof, or to the operation of
         your business; provided that you may contest any acts, rules,
         regulations, orders and directions of such bodies or officials in any
         reasonable manner which will not, in our opinion, adversely affect our
         rights or priority in the Collateral hereunder.

         5.       BOOKS AND RECORDS AND EXAMINATIONS

5.1      You agree to maintain Books and Records pertaining to the Inventory in
         such detail, form and scope as we shall reasonably require. "Books and
         Records" means your accounting and financial records (whether paper,
         computer or electronic), data, tapes, discs, or other media, and all
         programs, files, records and procedure manuals relating thereto,
         wherever located.

5.2      You agree that we or our agents may enter upon your premises at any
         time during normal business hours, and from time to time, for the
         purpose of inspecting the Inventory and any and all Books and Records
         pertaining thereto. You agree to notify us promptly of any change in
         your name, mailing address, principal place of business or the location
         of the Inventory. You are also to advise us promptly, in sufficient
         detail, of any substantial change relating to the type, quantity or
         quality of the Inventory, or any event which would have a material
         effect on the value of the Inventory or on the Security Interest
         granted to us herein.

5.3      You agree to: execute and deliver to us, from time to time, solely for
         our convenience in maintaining a record of the Inventory, such
         consignments or written statements as we may reasonably require,
         designating, identifying or describing the Inventory pledged to us
         hereunder. Your failure, however, to promptly give us such
         consignments, or other statements shall not affect, diminish, modify or
         otherwise limit our Security Interest in the Inventory.

         6.       EVENTS OF DEFAULT AND REMEDIES UPON DEFAULT

6.1      It is an "Event of Default" under this agreement if: (a) you breach any
         representation, warranty or covenant contained in this agreement; (b)
         you fail to pay any Obligation when due; or (c) an Event of Default (as
         defined therein) occurs under the Financing Agreement.

6.2      After the occurrence of an Event of Default which is not waived by us,
         we shall have the right, with or without notice to you, to foreclose
         the Security Interest created herein by nay available judicial
         procedure, or to take possession of the Inventory without judicial
         process, and to enter any premises where the Inventory may be located
         for the purpose of taking possession of or removing the Inventory. We
         shall have the right, without notice or advertisement, to sell, lease,
         or otherwise dispose of all or any part of the Inventory, whether in
         its then condition or after further preparation or processing, in your
         name or in ours, or in the name of such party as we may designate,
         either at public or private sale or at any broker's board, in lots or
         in bulk, for cash or for credit, with or without warranties or
         representations, and upon such other terms and conditions as we in our
         sole discretion may deem advisable, and we shall have the right to
         purchase at any such sale. If notice of intended disposition of any
         said Inventory is required by law, five (5) days notice shall
         constitute reasonable notification. If any Inventory shall require
         maintenance, preparation, or is in process or other unfinished state,
         we shall have the right, at our option, to do such maintenance,
         preparation, processing or completion of manufacturing, for the purpose
         of putting the Inventory in such saleable form as we shall deem
         appropriate. You agree, at our request, to assemble the Inventory and
         to make it available to us at places which we shall select, whether at
         your premises or elsewhere, and to make available to us you premises
         and facilities for the purpose of our taking possession of, removing or
         putting the Inventory in saleable form. The proceeds of any such sale,
         lease or other disposition of the Inventory shall be applied first, to
         the expenses of taking, holding, storing, processing, preparing for
         sale, selling, and the like, and then to the satisfaction of your
         Obligations to us, application as to particular Obligations or as to
         principal or interest to be in our sole discretion. You shall be liable
         to us for, and shall pay to us on demand, any deficiency which may
         remain after such sale, lease or other disposition, and we in turn
         agree to remit to you, or your successors or assigns, any surplus
         resulting therefrom. The enumeration of the


                                      B-42
<PAGE>

         foregoing rights is not intended to be exhaustive and the exercise of
         any right shall not preclude the exercise of any other rights, all of
         which shall be cumulative.

6.3      To the extent that your Obligations are now or hereafter secured by any
         assets or property other than the Inventory, or by the guarantee,
         endorsement, assets or property of any other person, then we shall have
         the right in our sole discretion to determine which rights, security,
         liens, security interests or remedies we shall at any time pursue,
         foreclose upon, relinquish, subordinate, modify or take any other
         action with respect to, without in any way modifying or affecting any
         of them, or of any of our rights hereunder.

         7.       TERMINATION

         The rights and Security Interest granted to us hereunder are to
continue in full force and effect, notwithstanding the fact that the account
maintained in your name on our books may from time to time be temporarily in a
credit position, until termination of the Financing Agreement and the final
payment in full of all Obligations due us by you.

         8.       MISCELLANEOUS PROVISIONS

8.1      This agreement and all attendant documentation, as the same may be
         amended from time to time, constitutes the entire agreement between us
         with regard to the subject matter hereof and supersedes any prior
         agreements or understandings. This agreement can be changed only by a
         writing signed by both of us and our failure or delay in exercising any
         of our rights hereunder will not constitute a waiver thereof, unless
         such waiver is in writing and signed by us, or bar us from exercising
         any of our rights at any time. No course of dealing between us shall
         change or modify this agreement. A waiver on any one occasion shall not
         be construed as a bar to or waiver of any right or remedy on any future
         occasion. The validity, interpretation and enforcement of this
         agreement shall be governed by the laws of the State of Georgia.

8.2      This agreement binds and benefits each of us and our respective
         successors and assigns, provided, however, that you may not assign this
         agreement or your rights hereunder without our prior written consent.

8.3      If any provision of this agreement is contrary to, prohibited by, or
         deemed invalid under, applicable laws or regulations, such provision
         will be inapplicable and deemed omitted to such extent, but the
         remainder will not be invalidated thereby and will be given effect so
         far as possible.

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<PAGE>

         9.       JURY TRIAL WAIVER

         TO THE EXTENT PERMITTED BY APPLICABLE LAW, WE EACH HEREBY WAIVE ANY
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING DIRECTLY OR
INDIRECTLY OUT OF THIS AGREEMENT, OR ANY OTHER AGREEMENT OR TRANSACTION BETWEEN
US OR TO WHICH WE ARE PARTIES.

If the foregoing is in accordance with your understanding, please so indicate by
signing and returning to us the original and one copy of this agreement. The
agreement shall take effect as of the date set forth above, after being accepted
below by one of our officers after which we shall forward a fully executed copy
to you for your files.

Very truly yours,

THE CIT GROUP/BUSINESS CREDIT, INC.



By:
   ---------------------------------
Name:
Title

Read and Agreed to:

MOORE-HANDLEY, INC.



By:
   ---------------------------------
Name:
Title

Accepted at Atlanta, Georgia

THE CIT GROUP/COMMERCIAL SERVICES, INC.



By:
   ---------------------------------
Name:
Title


                                      B-44

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