SECOND AMENDMENT TO
               AMENDED AND RESTATED CREDIT AND SECURITY AGREEMENT

          This Amendment, dated as of September 3, 1999, is made by and between
RSI SYSTEMS, INC., a Minnesota corporation (the "Borrower"), and WELLS FARGO
BUSINESS CREDIT, INC. f/k/a NORWEST BUSINESS CREDIT, INC., a Minnesota
corporation (the "Lender").

                                    Recitals

          The Borrower and the Lender have entered into an Amended and Restated
Credit and Security Agreement dated as of April 16, 1998 as amended by First
Amendment to Amended and Restated Credit and Security Agreement dated as of
September 22, 1998 (as so amended, the "Credit Agreement"). Capitalized terms
used in these recitals have the meanings given to them in the Credit Agreement
unless otherwise specified.

          The Borrower has requested that certain amendments be made to the
Credit Agreement, which the Lender is willing to make pursuant to the terms and
conditions set forth herein.

          NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, it is agreed as follows:

          1. DEFINED TERMS. Capitalized terms used in this Amendment which are
defined in the Credit Agreement shall have the same meanings as defined therein,
unless otherwise defined herein. In addition, Section 1.1 of the Credit
Agreement is amended by adding or amending, as the case may be, the following
definitions:

          "`Borrowing Base' means the lesser of:

               (a) the Maximum Line less the Norwest Bank Revolving Advances; or

               (b) the sum of:

                    (i) 80% of Eligible Accounts,

                    (ii) 100% of Eligible Certificates of Deposits, plus

                    (iii) 100% of Eligible Marketable Securities."

          "`Collateral' means the Special Account, all of the Borrower's
     Equipment, General Intangibles, Inventory, Receivables, all sums on deposit
     in any Collateral

<PAGE>

     Account, and any items in any Lockbox; together with (i) all substitutions
     and replacements for and products of any of the foregoing; (ii) proceeds of
     any and all of the foregoing; (iii) in the case of all tangible goods, all
     accessions; (iv) all accessories, attachments, parts, equipment and repairs
     now or hereafter attached or affixed to or used in connection with any
     tangible goods; and (v) all warehouse receipts, bills of lading and other
     documents of title now or hereafter covering such goods.

          "`Issuer' means the issuer of any Letter of Credit."

          "`L/C Amount' means the sum of (i) the aggregate face amount of any
     issued and outstanding Letters of Credit and (ii) the unpaid amount of the
     Obligation of Reimbursement."

          "`L/C Application' means an application and agreement for Letters of
     Credit in a form acceptable to the Issuer and the Lender."

          "`Letter of Credit' has the meaning given in Section 2.11."

          "`Maturity Date' means June 26, 2001."

          "`Maximum Line' means $2,500,000."

          "`Obligation of Reimbursement' has the meaning given in Section
     2.12(a)."

          "`Obligations' means each and every debt, liability and obligation of
     every type and description which the Borrower may now or at any time
     hereafter owe to the Lender, whether such debt, liability or obligation now
     exists or is hereafter created or incurred, whether it arises in a
     transaction involving the Lender alone or in a transaction involving other
     creditors of the Borrower, and whether it is direct or indirect, due or to
     become due, absolute or contingent, primary or secondary, liquidated or
     unliquidated, or sole, joint, several or joint and several, and including
     specifically, but not limited to, all indebtedness of the Borrower arising
     under this Agreement (including but not limited to the Notes and the
     Obligation of Reimbursement) or any other loan or credit agreement or
     guaranty between the Borrower and the Lender, whether now in effect or
     hereafter entered into."

          "`Revolving Note' means the Borrower's Second Replacement Promissory
     Note, payable to the order of the Lender in substantially the form of
     Exhibit A to the Second Amendment and any note or notes issued in
     substitution therefor, as the same may hereafter be amended, supplemented
     or restated from time to time."


                                      -2-
<PAGE>

          "`Second Amendment' means the Second Amendment to Amended and Restated
     Credit and Security Agreement by and between the Borrower and the Lender,
     dated as of September 3, 1999."

          "`Second Amendment Effective Date' means the date on which the
     conditions set forth in paragraph 15 of the Second Amendment are either
     satisfied or waived by the Lender."

          "`Special Account' means a specified cash collateral account
     maintained by a financial institution acceptable to the Lender in
     connection with Letters of Credit, as contemplated by Sections 2.13 and
     3.6."

          2. REVOLVING ADVANCES. Section 2.2 of the Credit Agreement is hereby
amended to read as follows:

          "Section 2.2 REVOLVING ADVANCES. The Lender agrees, on the terms and
     conditions set forth herein, to make advances to the Borrower from time to
     time from the date this Agreement is signed and delivered to the
     Termination Date (each a "Revolving Advance"). The Lender shall have no
     obligation to make a Revolving Advance if, after giving effect to such
     requested Revolving Advance, the sum of the outstanding and unpaid
     Revolving Advances plus the L/C Amount would exceed the Borrowing Base. The
     Borrower's obligation to pay the Revolving Advances shall be evidenced by
     the Revolving Note and shall be secured by the Collateral. Within the
     limits set forth in this Section 2.2, the Borrower may request Revolving
     Advances, prepay, and request additional Revolving Advances. The Borrower
     shall make each request for a Revolving Advance to the Lender before 11:00
     a.m. (Minneapolis time) of the day of the requested Revolving Advance.
     Requests may be made in writing or by telephone."

          3. CAPITAL ADEQUACY, ETC. Section 2.6 of the Credit Agreement is
amended to read as follows:

          "Section 2.6 CAPITAL ADEQUACY. If any Related Lender determines at any
     time that its Return has been reduced as a result of any Rule Change, such
     Related Lender may require the Borrower to pay it the amount necessary to
     restore its Return to what it would have been had there been no Rule
     Change. For purposes of this Section 2.6:

               (a) `Capital Adequacy Rule' means any law, rule, regulation,
          guideline, directive, requirement or request regarding capital
          adequacy, or the interpretation or administration thereof by any
          governmental or regulatory authority, central bank or comparable
          agency, whether or not having the force of law, that applies to any
          Related Lender. Such rules include rules requiring


                                      -3-
<PAGE>

          financial institutions to maintain total capital in amounts based upon
          percentages of outstanding loans, binding loan commitments and letters
          of credit.

               (b) `L/C Rule' means any law, rule, regulation, guideline,
          directive, requirement or request regarding letters of credit, or the
          interpretation or administration thereof by any governmental or
          regulatory authority, central bank or comparable agency, whether or
          not having the force of law, that applies to any Related Lender. Such
          rules include rules imposing taxes, duties or other similar charges,
          or mandating reserves, special deposits or similar requirements
          against assets of, deposits with or for the account of, or credit
          extended by any Related Lender, on letters of credit.

               (c) `Related Lender' includes (but is not limited to) the Lender,
          any parent corporation of the Lender and any assignee of any interest
          of the Lender hereunder and any participant in the loans made
          hereunder.

               (d) `Return' for any period, means the return as determined by a
          Related Lender on the Advances and Letters of Credit based upon its
          total capital requirements and a reasonable attribution formula that
          takes account of the Capital Adequacy Rules and L/C Rules then in
          effect, costs of issuing or maintaining any Letter of Credit and
          amounts received or receivable under this Agreement or the Notes with
          respect to any Advance or Letter of Credit. Return may be calculated
          for each calendar quarter and for the shorter period between the end
          of a calendar quarter and the date of termination in whole of this
          Agreement.

               (e) `Rule Change' means any change in any Capital Adequacy Rule
          or L/C Rule occurring after the date of this Agreement, but the term
          does not include any changes in applicable requirements that at the
          Closing Date are scheduled to take place under the existing Capital
          Adequacy Rules or L/C Rules or any increases in the capital that any
          Related Lender is required to maintain to the extent that the
          increases are required due to a regulatory authority's assessment of
          the financial condition of such Related Lender.

     The Lender will promptly notify the Borrower of any event of which it has
     knowledge, occurring after the date hereof, which will entitle the Lender
     to compensation pursuant to this Section 2.6. Certificates of any Related
     Lender sent to the Borrower from time to time claiming compensation under
     this Section 2.6, stating the reason therefor and setting forth in
     reasonable detail the calculation of the additional amount or amounts to be
     paid to the Related Lender hereunder to restore its Return shall


                                      -4-
<PAGE>

     be conclusive absent manifest error. In determining such amounts, the
     Related Lender may use any reasonable averaging and attribution methods."

          4. MANDATORY PREPAYMENT. Section 2.7 of the Credit Agreement is
amended to read as follows:

          "Section 2.7 MANDATORY PREPAYMENT. Without notice or demand, if the
     outstanding principal balance of the Revolving Advances shall at any time
     exceed the Borrowing Base plus the L/C Amount, the Borrower shall
     immediately prepay the Revolving Advances to the extent necessary to
     eliminate such excess."

          5. Fees. Section 2.10 of the Credit Agreement is amended to read as
follows:

          "Section 2.10 Fees.

               (a) UNUSED LINE FEE. For the purposes of this Section 2.10(a),
          "Unused Amount" means (i) the Maximum Line, minus (ii) the sum of (A)
          the outstanding Revolving Advances and (B) the L/C Amount. The
          Borrower shall pay to the Lender an unused line fee of one quarter of
          one percent (0.25%) of the average daily Unused Amount during each
          calendar quarter, due and payable quarterly in arrears on the first
          day of each quarter and on the Termination Date.

               (b) LETTER OF CREDIT FEES. The Borrower shall pay the Lender a
          fee with respect to each Letter of Credit, if any, computed at the
          annual rate of two percent (2%) of the amount of each requested Letter
          of Credit for the term of the requested Letter of Credit. Such fee
          shall be due and payable in full at the time the Borrower submits an
          L/C Application for such Letter of Credit. The foregoing fee shall be
          in addition to any and all fees, commissions and charges of any Issuer
          of a Letter of Credit with respect to or in connection with such
          Letter of Credit.

               (c) LETTER OF CREDIT ADMINISTRATIVE FEES. The Borrower shall pay
          the Lender, on demand, the administrative fees charged by the Issuer
          in connection with the honoring of drafts under any Letter of Credit,
          amendments thereto, transfers thereof and all other activity with
          respect to the Letters of Credit at the then-current rates published
          by the Issuer for such services rendered on behalf of customers of the
          Issuer generally."


                                      -5-
<PAGE>

          6. LETTER OF CREDIT PROVISIONS. The following new Sections are added
to the Credit Agreement at the end of Article II:

          "Section 2.11 ISSUANCE OF LETTERS OF CREDIT.

               (a) The Lender may, in its sole discretion and on the terms and
          conditions set forth herein, cause an Issuer to issue, from the Second
          Amendment Effective Date to the Termination Date, one or more
          documentary letters of credit (each, a "Letter of Credit") for the
          Borrower's account.

                    (i) The Lender shall not consider any request for the
               issuance of any Letter of Credit for the benefit of the Borrower
               if the face amount of the Letter of Credit to be issued, would
               exceed the lesser of:

                         (A) $500,000 less the L/C Amount, or

                         (B) the Borrowing Base less the sum of (1) all
                    outstanding and unpaid Revolving Advances and (2) the L/C
                    Amount.

          Each Letter of Credit, if any, shall be issued pursuant to a separate
          L/C Application entered by the Borrower and the Lender for the benefit
          of the Issuer, completed in a manner satisfactory to the Lender and
          the Issuer. The terms and conditions set forth in each such L/C
          Application shall supplement the terms and conditions hereof, but if
          the terms of any such L/C Application and the terms of this Agreement
          are inconsistent, the terms hereof shall control.

               (b) No Letter of Credit shall be issued with an expiry date later
          than the Maturity Date.

               (c) Any request for the issuance of a Letter of Credit under this
          Section 2.11 shall be deemed to be a representation by the Borrower
          that the statements set forth in Section 4.2 hereof are correct as of
          the time of the request.

          "Section 2.12 PAYMENT OF AMOUNTS DRAWN UNDER LETTERS OF CREDIT. The
     Borrower acknowledges that the Lender, as co-applicant, will be liable to
     the Issuer of any Letter of Credit for reimbursement of any and all draws
     thereunder and all other amounts required to be paid under


                                      -6-
<PAGE>

     the applicable L/C Application. Accordingly, the Borrower agrees to pay to
     the Lender any and all amounts required to be paid under the applicable L/C
     Application, when and as required to be paid thereby, and the amounts
     designated below, when and as designated:

               (a) The Borrower hereby agrees to pay the Lender on the day a
          draft is honored under any Letter of Credit a sum equal to all amounts
          drawn under such Letter of Credit plus any and all reasonable charges
          and expenses that the Issuer or the Lender may pay or incur relative
          to such draw, plus interest on all such amounts, charges and expenses
          as set forth below (all such amounts are hereinafter referred to as
          the "Obligation of Reimbursement").

               (b) The Borrower hereby agrees to pay the Lender on demand
          interest on all amounts, charges and expenses payable by the Borrower
          to the Lender under this Section 2.12, accrued from the date any such
          draft, charge or expense is paid by the Issuer until payment in full
          by the Borrower at the Revolving Floating Rate.

     If the Borrower fails to pay to the Lender promptly the amount of its
     Obligation of Reimbursement in accordance with the terms hereof and the L/C
     Application pursuant to which such Letter of Credit was issued, the Lender
     is hereby irrevocably authorized and directed, in its sole discretion, to
     make a Revolving Advance in an amount sufficient to discharge the
     Obligation of Reimbursement, including all interest accrued thereon but
     unpaid at the time of such Revolving Advance, and such Revolving Advance
     shall be evidenced by the Revolving Note and shall bear interest as
     provided in Section 2.3 hereof.

          "Section 2.13 SPECIAL ACCOUNT. If this Credit Facility is terminated
     for any reason whatsoever, while any Letter of Credit is outstanding, the
     Borrower shall thereupon pay the Lender in immediately available funds for
     deposit in the Special Account an amount equal to the maximum aggregate
     amount available to be drawn under all Letters of Credit then outstanding,
     assuming compliance with all conditions for drawing thereunder. The Special
     Account shall be maintained for the Lender by any financial institution
     acceptable to the Lender. Any interest earned on amounts deposited in the
     Special Account shall be credited to the Special Account. Amounts on
     deposit in the Special Account may be applied by the Lender at any time or
     from time to time to the Borrower's Obligation of Reimbursement or any
     other Obligations, in the Lender's sole discretion, and shall not be
     subject to withdrawal by the Borrower so long as the Lender maintains a
     security interest therein. The Lender agrees to transfer any balance in the
     Special Account to the Borrower at such time as the Lender is required to
     release its security interest in the Special Account under applicable law.


                                      -7-
<PAGE>

          "Section 2.14 OBLIGATIONS ABSOLUTE. The obligations of the Borrower
     arising under Section 2.12 shall be absolute, unconditional and
     irrevocable, and shall be paid strictly in accordance with the terms of
     this Agreement, under all circumstances whatsoever, including (without
     limitation) the following circumstances:

               (a) any lack of validity or enforceability of any Letter of
          Credit or any other agreement or instrument relating to any Letter of
          Credit (collectively the "Related Documents");

               (b) any amendment or waiver of or any consent to departure from
          all or any of the Related Documents;

               (c) the existence of any claim, setoff, defense or other right
          which the Borrower may have at any time, against any beneficiary or
          any transferee of any Letter of Credit (or any persons or entities for
          whom any such beneficiary or any such transferee may be acting), or
          other person or entity, whether in connection with this Agreement, the
          transactions contemplated herein or in the Related Documents or any
          unrelated transactions;

               (d) any statement or any other document presented under any
          Letter of Credit proving to be forged, fraudulent, invalid or
          insufficient in any respect or any statement therein being untrue or
          inaccurate in any respect whatsoever;

               (e) payment by or on behalf of the Issuer or the Lender under any
          Letter of Credit against presentation of a draft or certificate which
          does not strictly comply with the terms of such Letter of Credit; or

               (f) any other circumstance or happening whatsoever, whether or
          not similar to any of the foregoing."

          7. PLEDGE OF SPECIAL ACCOUNT AND COLLATERAL ACCOUNT. The following new
Section 3.6 is added at the end of Article III:

               "Section 3.6 SECURITY INTEREST IN SPECIAL ACCOUNT. The Borrower
          hereby pledges, and grants to the Lender a security interest in, all
          funds held in the Special Account from time to time and all proceeds
          thereof, as security for the payment of all Obligations."


                                      -8-
<PAGE>

          8. CONDITIONS PRECEDENT TO EACH ADVANCE AND EACH LETTER OF CREDIT.
Section 4.2 of the Credit Agreement is amended to read as follows:

          "Section 4.2 CONDITIONS PRECEDENT TO ALL ADVANCES AND CAUSING ALL
     LETTERS OF CREDIT TO BE ISSUED. The Lender's obligation to make each
     Advance or issue any Letter of Credit shall be subject to the further
     conditions precedent that on such date:

               (a) the representations and warranties contained in Article V
          hereof are correct on and as of such date of such Advance as though
          made on and as of such date, except to the extent that such
          representations and warranties relate solely to an earlier date; and

               (b) no event has occurred and is continuing, or would result from
          such Advance or the issuance of such Letter of Credit, as the case may
          be, which constitutes a Default or an Event of Default."

          9. MINIMUM BOOK NET WORTH. Section 6.8 of the Credit Agreement is
hereby amended to read as follows:

          "Section 6.8 MINIMUM BOOK NET WORTH. The Borrower will maintain its
     Book Net Worth determined as at the end of each month, at an amount not
     less than the amount set forth opposite such month:

<TABLE>
<CAPTION>
               Month                          Minimum Book Net Worth
               -----                          ----------------------
<S>                                           <C>
           July 31, 1999                        $1,000,000
          August 31, 1999                        $900,000
         September 30, 1999                     $1,000,000
          October 31, 1999                      $1,000,000
         November 30, 1999                      $1,100,000
         December 31, 1999                      $1,150,000
          January 31, 2000                      $1,300,000
         February 29, 2000                      $1,450,000
           March 31, 2000                       $1,650,000
           April 30, 2000                       $1,825,000
            May 31, 2000                        $2,050,000
           June 30, 2000                        $2,300,000
</TABLE>


                                      -9-
<PAGE>

          10. EVENTS OF DEFAULT. Section 7.1 of the Credit Agreement is amended
to add the following new subsection 7.1(e) immediately after Section 7.1(d):

          "(e) Failure to pay when due any amount specified in Section 2.9
     hereof relating to the Borrower's Obligation of Reimbursement, or failure
     to pay immediately when due or upon termination of the Credit Facility any
     amounts required to be paid for deposit in the Special Account under
     Section 2.9 or 2.10 hereof."

          11. RIGHTS AND REMEDIES. The following new Section 7.2(d) is added to
the Credit Agreement immediately after Section 7.2(c):

          "(d) The Lender may make demand upon the Borrower and, forthwith upon
     such demand, the Borrower will pay to the Lender in immediately available
     funds for deposit in the Special Account pursuant to Sections 2.9 and 2.10
     an amount equal to the maximum aggregate amount available to be drawn under
     all Letters of Credit then outstanding, assuming compliance with all
     conditions for drawing thereunder."

          12. NO OTHER CHANGES. Except as explicitly amended by this Amendment,
all of the terms and conditions of the Credit Agreement shall remain in full
force and effect and shall apply to any advance or letter of credit thereunder.

          13. WAIVER OF DEFAULTS. The Borrower is in default of Section 6.8 of
the Credit Agreement which requires that the Borrower maintain a minimum Book
Net Worth of at least $2,000,000. As of June 30, 1999, the Borrower had an
actual Book Net Worth of $1,485,000 (the "Default"). Upon the terms and subject
to the conditions set forth in this Second Amendment, the Lender hereby waives
the Default. This waiver shall be effective only in this specific instance and
for the specific purpose for which it is given, and this waiver shall not
entitle the Borrower to any other or further waiver in any similar or other
circumstances.

          14. AMENDMENT FEE. The Borrower shall pay the Lender as of the date
hereof a fully earned, non-refundable fee in the amount of $2,500 for the
increase in the Maximum Line and the default waiver in Paragraph 13 of this
Second Amendment.

          15. CONDITIONS PRECEDENT. This Amendment shall be effective when the
Lender shall have received an executed original hereof, together with each of
the following, each in substance and form acceptable to the Lender in its sole
discretion:

          (a) The Revolving Note substantially in the form of Exhibit A hereto,
     duly executed on behalf of the Borrower (the "Revolving Note").


                                      -10-
<PAGE>

          (b) A Certificate of the Secretary of the Borrower certifying as to
     (i) the resolutions of the board of directors of the Borrower approving the
     execution and delivery of this Amendment, (ii) the fact that the articles
     of incorporation and bylaws of the Borrower, which were certified and
     delivered to the Lender pursuant to the Certificate of Authority of the
     Borrower's secretary dated as of June 26, 1997 continue in full force and
     effect and have not been amended or otherwise modified except as set forth
     in the Certificate to be delivered, and (iii) certifying that the officers
     and agents of the Borrower who have been certified to the Lender, pursuant
     to the Certificate of Authority of the Borrower's secretary dated as of
     April 16, 1998, as being authorized to sign and to act on behalf of the
     Borrower continue to be so authorized or setting forth the sample
     signatures of each of the officers and agents of the Borrower authorized to
     execute and deliver this Amendment and all other documents, agreements and
     certificates on behalf of the Borrower.

          (c) An amendment to the Patent Security Agreement sufficient to grant
     the Lender a security interest in the Borrower's newly acquired patent for
     the peripheral video conferencing system technology in Mediapro.

          (d) Payment of the fee described in Paragraph 14.

          (e) Such other matters as the Lender may require.

          16. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents and
warrants to the Lender as follows:

          (a) The Borrower has all requisite power and authority to execute this
     Amendment and the Revolving Note and to perform all of its obligations
     hereunder, and this Amendment and the Revolving Note have been duly
     executed and delivered by the Borrower and constitute the legal, valid and
     binding obligations of the Borrower, each enforceable in accordance with
     its terms.

          (b) The execution, delivery and performance by the Borrower of this
     Amendment and the Revolving Note have been duly authorized by all necessary
     corporate action and do not (i) require any authorization, consent or
     approval by any governmental department, commission, board, bureau, agency
     or instrumentality, domestic or foreign; (ii) violate any provision of any
     law, rule or regulation or of any order, writ, injunction or decree
     presently in effect, having applicability to the Borrower, or the articles
     of incorporation or by-laws of the Borrower; or (iii) result in a breach of
     or constitute a default under any indenture or loan or credit agreement or
     any other agreement, lease or instrument to which the Borrower is a party
     or by which it or its properties may be bound or affected.


                                      -11-
<PAGE>

          (c) All of the representations and warranties contained in Article V
     of the Credit Agreement are correct on and as of the date hereof as though
     made on and as of such date, except to the extent that such representations
     and warranties relate solely to an earlier date.

          17. REFERENCES. All references in the Credit Agreement to "this
Agreement" shall be deemed to refer to the Credit Agreement as amended hereby;
and any and all references in the Security Documents to the Credit Agreement
shall be deemed to refer to the Credit Agreement as amended hereby.

          18. NO OTHER WAIVER. Except as set forth in paragraph 13 hereof, the
execution of this Amendment and acceptance of the Revolving Note and any
documents related hereto shall not be deemed to be a waiver of any Default or
Event of Default under the Credit Agreement or breach, default or event of
default under any Security Document or other document held by the Lender,
whether or not known to the Lender and whether or not existing on the date of
this Amendment.

          19. RELEASE. The Borrower hereby absolutely and unconditionally
releases and forever discharges the Lender, and any and all participants, parent
corporations, subsidiary corporations, affiliated corporations, insurers,
indemnitors, successors and assigns thereof, together with all of the present
and former directors, officers, agents and employees of any of the foregoing,
from any and all claims, demands or causes of action of any kind, nature or
description, whether arising in law or equity or upon contract or tort or under
any state or federal law or otherwise, which the Borrower has had, now has or
has made claim to have against any such person for or by reason of any act,
omission, matter, cause or thing whatsoever arising from the beginning of time
to and including the date of this Amendment, whether such claims, demands and
causes of action are matured or unmatured or known or unknown.

          20. COSTS AND EXPENSES. The Borrower hereby reaffirms its agreement
under the Credit Agreement to pay or reimburse the Lender on demand for all
costs and expenses incurred by the Lender in connection with the Credit
Agreement, the Security Documents and all other documents contemplated thereby,
including without limitation all reasonable fees and disbursements of legal
counsel. Without limiting the generality of the foregoing, the Borrower
specifically agrees to pay all fees and disbursements of counsel to the Lender
for the services performed by such counsel in connection with the preparation of
this Amendment and the documents and instruments incidental hereto. The Borrower
hereby agrees that the Lender may, at any time or from time to time in its sole
discretion and without further authorization by the Borrower, make a loan to the
Borrower under the Credit Agreement, or apply the proceeds of any loan, for the
purpose of paying any such fees, disbursements, costs and expenses and the fee
required under paragraph 14 hereof.


                                      -12-
<PAGE>

          21. MISCELLANEOUS. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original and all of which counterparts, taken together, shall constitute one and
the same instrument.

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

WELLS FARGO BUSINESS CREDIT, INC.               RSI SYSTEMS, INC.



By                                              By
   ---------------------------------              ------------------------------

   ---------------------------------              ------------------------------
     Its Vice President                              Its
                                                        ------------------------


                                      -13-
<PAGE>

                                                Exhibit A to Second Amendment to
                                                Amended and Restated Credit and
                                                Security Agreement

                        SECOND REPLACEMENT REVOLVING NOTE

$2,500,000                                                Minneapolis, Minnesota
                                                               September 3, 1999

          For value received, the undersigned, RSI SYSTEMS, INC., a Minnesota
corporation (the "Borrower"), hereby promises to pay on the Termination Date
under the Credit Agreement (defined below) to the order of WELLS FARGO BUSINESS
CREDIT, INC., a Minnesota corporation (the "Lender"), at its main office in
Minneapolis, Minnesota, or at any other place designated at any time by the
holder hereof, in lawful money of the United States of America and in
immediately available funds, the principal sum of Two Million, Five Hundred
Thousand Dollars ($2,500,000) or, if less, the aggregate unpaid principal amount
of all Advances made by the Lender to the Borrower under the Amended and
Restated Credit and Security Agreement dated as of April 16, 1998 by and between
the Lender and the Borrower as amended by a First Amendment to Amended and
Restated Credit and Security Agreement dated as of September 22, 1998 and Second
Amendment to Amended and Restated Credit and Security Agreement of even date
herewith (as the same may hereafter be amended, supplemented or restated from
time to time, the "Credit Agreement") together with interest on the principal
amount hereunder remaining unpaid from time to time (computed on the basis of
actual days elapsed in a 360-day year) from the date of the initial Advance
until this Note is fully paid at the rate from time to time in effect under the
Credit Agreement.

          This Note is the Revolving Note as defined in the Credit Agreement and
is subject to the Credit Agreement. To the extent this Note evidences the
Borrower's obligation to pay existing Revolving Advances, this Note is issued in
substitution for and replacement of but not in payment of the Borrower's
promissory note dated as of September 22, 1998 payable to the order of the
Lender in the original principal amount of $2,000,000.

                                  RSI SYSTEMS, INC.


                                  By
                                    --------------------------------------------
                                    Donald C. Lies
                                    Its President
                                    and Chief Executive Officer

Source: OneCLE Business Contracts.