INSIGNIA SYSTEMS INC/MN
EXHIBIT 10.14 THIRD AMENDMENT TO FINANCING AGRMT
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<DESCRIPTION>EXHIBIT 10.14 THIRD AMENDMENT TO FINANCING AGRMT
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                                                                   EXHIBIT 10.14


                               THIRD AMENDMENT TO
                               FINANCING AGREEMENT


         THIS THIRD AMENDMENT TO FINANCING AGREEMENT (this "Amendment"), made
and entered into as of October 31, 2000, is by and between INSIGNIA SYSTEMS,
INC., a Minnesota corporation ("Borrower"), and U.S. BANK NATIONAL ASSOCIATION
as assignee of U.S. BANCORP REPUBLIC COMMERCIAL FINANCE, INC., (the "Lender").

                                    RECITALS

         1. The Lender and the Borrower entered into a Financing Agreement dated
as of December 29, 1997, as amended by that First Amendment to Financing
Agreement dated as of September 30, 1998, and as further amended by that Second
Amendment to Financing Agreement dated as of June 30, 1999 (as amended, the
"Financing Agreement");

         2. The Borrower and the Lender desire to amend certain provisions of
the Financing Agreement.

                                    AGREEMENT

         NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto hereby covenant
and agree to be bound as follows:

         SECTION 1. CAPITALIZED TERMS. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to them in the
Financing Agreement, unless the context shall otherwise require.

         SECTION 2. AMENDMENTS. The Financing Agreement is hereby amended in its
entirety as follows:

                  2.1 THE ADVANCES. Section 2.1 of the Financing Agreement is
         amended in it entirety as follows:

                           Section 2.1 The Advances. On the terms and subject to
                  the conditions hereof, at the Borrower's request, the Lender,
                  in its absolute and sole discretion and without any commitment
                  to do so, may make the following Advances available to the
                  Borrower:

                           2.1(a) up to seventy-five percent (75%) of the net
                  amount of Eligible Accounts which are listed in the Borrower's
                  most current Borrowing Base Certificate and which are deemed
                  eligible for advances by the Lender, or such greater or lesser
                  percentage at the Lender's sole and absolute discretion, not
                  to exceed a maximum amount of $2,000,000 (the "Accounts
                  Advances");


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                           2.1(b) up to thirty percent (30%) of the net amount
                  of Eligible Inventory which is listed in the Borrower's most
                  current Borrowing Base Certificate and which is deemed
                  eligible for advances by the Lender, or such greater or lesser
                  percentage at the Lender's sole and absolute discretion, not
                  to exceed a maximum amount of $400,000 (the "Inventory
                  Advances");

                           2.1(c) Letters of Credit. Until December 31, 2001,
                  the Lender agrees the Borrower may cause to be issued through
                  an Affiliate of the Lender, in the sole and absolute
                  discretion of such Affiliate, standby or documentary letters
                  of credit, provided, however, that the total amount of all
                  unexpired letters of credit and unreimbursed draws under
                  letters of credit (the "LC Obligations") shall not at any time
                  exceed $160,000 and the total amount of the outstanding
                  principal balance of the Advances under clauses 2.1(a) and
                  2.1(b) plus 125% of the LC Obligations (the "Total Revolving
                  Outstandings") shall not at any time exceed $2,000,000. If
                  issued, all letters of credit shall be subject to a 1% fee
                  payable to the issuer, and the Borrower will execute such
                  applications, security or pledge agreements and other
                  documents required by Lender's Affiliate and shall pay the
                  Lender's and such Affiliate's fees and expenses related to
                  such letters of credit. Each letter of credit shall be for a
                  period not to exceed one year, but may be renewable annually
                  for additional one year periods not to exceed three years in
                  the aggregate. Any draw under a letter of credit may, at the
                  option of the Lender, be repaid through an Advance, which the
                  Lender may make, and which the Borrower is obligated to repay,
                  even though (a) any agreement of the Lender to make Advances
                  in its sole discretion may have expired or terminated, (b) the
                  Borrower is at that time the debtor in any bankruptcy,
                  reorganization or insolvency proceeding, or (c) the Total
                  Revolving Outstandings exceed the availability under the most
                  recent Borrower Base Certificate or $2,000,000.

         The total amounts advanced under Section 2.1(a), 2.1(b) and 2.1(c) is
the Facility Amount.

         Notwithstanding the previous clauses 2.1(a), 2.1(b)and 2.1(c), the
maximum aggregate amount advanced against all Eligible Accounts and all Eligible
Inventory from time to time shall not exceed $2,000,000.

         Loans for additional sums requested by the Borrower may be made at the
Lender's sole discretion based upon the Lender's valuation of the Borrower's
collateral or other factors. The Borrower acknowledges and agrees that the
Lender may from time to time, for the Lender's convenience, segregate or
apportion the Borrower's collateral for purposes of determining the amounts and
maximum amounts of Advances which may be made hereunder. Nevertheless, the
Lender's security interest in all such collateral, and any other collateral
rights, interests and properties which may now or hereafter be available to the
Lender, shall secure and may be applied to the payment of any and all Advances
and other indebtedness secured by the Lender's security


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interest, in any order or manner of application and without regard to the method
by which the Lender determines to make Advances hereunder.

                  2.2 INTEREST RATES AND INTEREST PAYMENTS. Section 2.3 of the
         Financing Agreement is amended in its entirety as follows:

                           Section 2.3 Interest Rates and Interest Payments.
                  Interest shall accrue on the unpaid balance of the Advances at
                  a floating rate per annum equal to the sum of the Reference
                  Rate plus 2% (the "Applicable Rate") and shall be due and
                  payable monthly in arrears on the last day of each calendar
                  month; provided, however, that upon the occurrence and during
                  the continuance of any failure by the Borrower to comply with
                  any agreement or covenant of the Borrower under any Loan
                  Document, the unpaid balance of the Advances shall thereafter
                  bear interest at a floating rate equal to the sum of (a) the
                  Applicable Rate, plus (b) 2% and shall be due and payable on
                  demand; and provided further that the minimum amount of
                  interest due and payable in any month shall not be less than
                  $5,000.

                  SECTION 2.3 ANNUAL FEE. Section 2.6 of the Financing Agreement
         is amended in its entirety to provide as follows:

                           Section 2.6 Annual Fee. The Borrower shall pay to the
                  Lender an annual fee in an amount equal to .75 percent of the
                  Facility Amount (the "Annual Fee"). The Annual Fee shall be
                  payable in advance on October 1, 2000 and on each October 1
                  thereafter. The Annual Fee is earned when due and is
                  non-refundable.

                  SECTION 2.4 INSPECTION. Section 5.5 of the Financing Agreement
         is amended in its entirety to provide as follows:

                           Section 5.5 Inspection. The Borrower will permit any
                  Person designated by the Lender to visit and inspect any of
                  the properties, books and financial records of the Borrower,
                  to examine and to make copies of the books of accounts and
                  other financial records of the Borrower, and to discuss the
                  affairs, finances and accounts of the Borrower with its
                  officers at such reasonable times and intervals as the Lender
                  may designate. The Borrower shall also allow the Lender and
                  its agents to conduct periodic collateral audits of the
                  Borrower's assets at such intervals as the Lender may choose,
                  and the Borrower shall pay to Lender a fee in the amount of
                  $750 per day per collateral audit, plus out-of-pocket costs
                  and expenses incurred in connection with such collateral
                  audits, (provided that so long as no Event of Default (as that
                  term is defined in the Security Agreement) has occurred under
                  the Security Agreement and is continuing, the Borrower shall
                  not be required to pay for more than 3 collateral audits in
                  any calendar year).

                  SECTION 2.5 Termination. Article VII of the Financing
         Agreement is amended in its entirety to provide as follows:


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                                   ARTICLE VII

                             TERMINATION BY BORROWER

         This agreement shall continue in effect until terminated upon not less
than 30 days' prior written notice delivered by the Borrower to Lender by
certified mail. Termination shall not impair or affect the Lender's rights
existing as of the time notice of Termination is given. Borrowers obligations
with respect to payment of any Termination fee shall be fixed and owing as of
date such notice is given and not when such notice becomes effective.

         In the event that the Borrower gives notice to the Lender of the
termination of this Agreement under Section VII hereof at any time prior to
December 31, 2001, the Borrower will pay to the Lender a prepayment charge, as
additional compensation for the Lender's costs of entering into this Agreement,
in the amount of 1% of the Facility Amount if the notice of termination occurs
prior to December 31, 2001; unless the outstanding amount of Borrower's
obligations hereunder are refinanced in full by an affiliate of U.S. Bancorp.

         SECTION 3. EFFECTIVENESS OF AMENDMENTS. The amendments contained in
this Amendment shall become effective upon delivery by the Borrower of, and
compliance by the Borrower with, the following:

                  3.1 This Amendment, duly executed by the Borrower.

                  3.2 A copy of the resolutions of each of the Borrower
         authorizing the execution, delivery and performance of this Amendment
         certified as true and accurate by its Secretary, along with a
         certification by such Secretary (i) certifying that there has been no
         amendment to the Articles of Incorporation or Bylaws of the Borrower
         since true and accurate copies of the same were delivered to the Lender
         with a certificate of the Secretary of the Borrower dated December 29,
         1997, and (ii) identifying each officer of the Borrower authorized to
         execute this Amendment and any other instrument or agreement executed
         by the Borrower in connection with this Amendment, and certifying as to
         specimens of such officer's signature and such officer's incumbency in
         such offices as such officer holds.

         SECTION 4. REPRESENTATIONS; ACKNOWLEDGMENTS. The Borrower hereby
represents that on and as of the date hereof and after giving effect to this
Amendment (a) all of the representations and warranties contained in the
Financing Agreement, and in any and all other Loan Documents of the Borrower,
are true, correct and complete in all respects as of the date hereof as though
made on and as of such date, except for changes permitted by the terms of the
Financing Agreement, or which relates to changes in the financial condition of
the Borrower that are reflected in the financial statements furnished to Lender
or in the nature of prospects in the Borrower's business that have been
delivered to Lender, and (b) the Borrower is in compliance with all covenants
and agreements of the Borrower as set forth in the Financing Agreement and in
any and all other Loan Documents of the Borrower. The Borrower represents and
warrants that the Borrower has the power and legal right and authority to enter
into this Amendment and has duly authorized as appropriate the execution and
delivery of this Amendment and other agreements and documents executed and
delivered by the Borrower in connection herewith or therewith by proper
corporate action. The


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Borrower acknowledges and agrees that its obligations to the Lender under the
Financing Agreement exist and are owing without offset, defense or counterclaim
assertable by the Borrower against the Lender. The Borrower further acknowledges
and agrees that its obligations to the Lender under the Financing Agreement, as
amended, constitute "Obligations" within the meaning of the Security Agreement
and are secured by the Security Agreement, as amended.

         SECTION 5. AFFIRMATION, FURTHER REFERENCES. Except as expressly
modified under this Amendment, all of the terms, conditions, provisions,
agreements, requirements, promises, obligations, duties, covenants and
representations of the Borrower under the Financing Agreement, the Security
Agreement, and any and all other Loan Documents entered into with respect to the
obligations under the Financing Agreement are incorporated herein by reference
are hereby ratified and affirmed in all respects by the Borrower. All references
in the Financing Agreement to "this Agreement," "herein," "hereof," and similar
references, and all references in the other Loan Documents to the "Agreement,"
shall be deemed to refer to the Agreement, as amended by this Amendment.

         SECTION 6. MERGER AND INTEGRATION, SUPERSEDING EFFECT. This Amendment,
from and after the date hereof, embodies the entire agreement and understanding
between the parties hereto and supersedes and has merged into it all prior oral
and written agreements on the same subjects by and between the parties hereto
with the effect that this Amendment, shall control with respect to the specific
subjects hereof and thereof.

         SECTION 7. SEVERABILITY. Whenever possible, each provision of this
Amendment and any other statement, instrument or transaction contemplated hereby
or thereby or relating hereto or thereto shall be interpreted in such manner as
to be effective, valid and enforceable under the applicable law of any
jurisdiction, but, if any provision of this Amendment or any other statement,
instrument or transaction contemplated hereby or thereby or relating hereto or
thereto shall be held to be prohibited, invalid or unenforceable under the
applicable law, such provision shall be ineffective in such jurisdiction only to
the extent of such prohibition, invalidity or unenforceability, without
invalidating or rendering unenforceable the remainder of such provision or the
remaining provisions of this Amendment or any other statement, instrument or
transaction contemplated hereby or thereby or relating hereto or thereto in such
jurisdiction, or affecting the effectiveness, validity or enforceability of such
provision in any other jurisdiction.

         SECTION 8. SUCCESSORS. This Amendment shall be binding upon the
Borrower and the Lender and their respective successors and assigns, and shall
inure to the benefit of the Borrower and the Lender and the successors and
assigns of the Lender.

         SECTION 9. LEGAL EXPENSES. The Borrower agrees to reimburse the Lender,
upon execution of this Amendment, for all reasonable out-of-pocket expenses
(including attorneys' fees and legal expenses of Dorsey & Whitney, counsel for
the Lender) incurred in connection with the Financing Agreement, including in
connection with the negotiation, preparation and execution of this Amendment and
all other documents negotiated, prepared and executed in connection with this
Amendment, and in enforcing the obligations of the Borrower under the Financing
Agreement, as amended by this Amendment, which obligations of the Borrower shall
survive any termination of the Financing Agreement.


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         SECTION 10. HEADINGS. The headings of various sections of this
Amendment have been inserted for reference only and shall not be deemed to be a
part of this Amendment.

         SECTION 11. COUNTERPARTS. This Amendment may be executed in several
counterparts as deemed necessary or convenient, each of which, when so executed,
shall be deemed an original, provided that all such counterparts shall be
regarded as one and the same document, and either party to this Amendment may
execute any such agreement by executing a counterpart of such agreement.

         SECTION 12. GOVERNING LAW. The Amendment Documents shall be governed by
the internal laws of the State of Minnesota, without giving effect to conflict
of law principles thereof.



         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the date and year first above written.


                                            INSIGNIA SYSTEMS, INC.



                                            By:   /s/ John R. Whisnant
                                                 ---------------------
                                                 Its:  VP Finance
                                                      -----------


                                            U.S. BANK NATIONAL ASSOCIATION,
                                            Assignee of U.S. BANCORP REPUBLIC
                                            COMMERCIAL FINANCE, INC.



                                            By:   /s/ Leonard H. Ramotar
                                                 ---------------------
                                                 Its:  Vice President
                                                      ---------------


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