EXHIBIT 10.13

                                  MORTGAGE NOTE

$3,200,000.00                                                 January 14, 2004

     FOR VALUE  RECEIVED,  and  without  defalcation  or  setoff,  Transnational
Industries,   Inc.,  a  Delaware  corporation,   and  Spitz,  Inc.,  a  Delaware
corporation  (individually,  collectively,  jointly and severally referred to as
the  "Maker"),  with  an  address  of  P.O.  Box  198,  Route  1,  Chadds  Ford,
Pennsylvania  19317  promises  to  pay to  the  order  of  FIRST  KEYSTONE  BANK
("Payee"), a federally chartered stock savings bank organized and existing under
the laws of the United States of America,  at Payee's  office located at 22 West
State Street, Media, Pennsylvania,  19063, the principal amount of Three Million
Two Hundred Thousand  ($3,200,000.00)  Dollars,  advanced pursuant to the terms,
conditions, and provisions of a certain Loan Agreement dated even date herewith,
by and between Maker and Payee (the "Loan Agreement"), together with interest on
the outstanding principal balance of this Mortgage Note (the Note) from the date
hereof  at the  rate of five and  three  quarter  (5.750%)  percent  per  annum,
provided, however, effective January 14, 2006, and on that same day every thirty
sixth (36th) month  thereafter  the rate of interest  will adjust to a fixed per
annum rate equal to the greater of (i) five and three quarter (5.750%)  percent,
or (ii)  three  hundred  (300)  basis  points  (3.00%)  over the  Three (3) Year
Constant  Maturity  Treasury  Rate,  the said fixed rate to be set five (5) days
prior to the effective date of the rate change;  provided,  however, that should
the fifth day fall on a Saturday,  Sunday or a bank holiday, the said fixed rate
shall be set on the last day  prior to such the  fifth day for which a Three (3)
Year Constant  Maturity  Treasury  Rate is available.  The rate of interest from
time to time  charged on the  outstanding  balance  of this Note is  hereinafter
referred to as the Rate.

1. Payment.  The principal  amount of this Note shall be payable,  together with
interest thereon, in lawful money of the United States, in the following manner:

          (a) On January 1, 2004, a payment of interest only scheduled to accrue
     on the principal  balance  outstanding  from the date hereof to January 31,
     2004.

          (b) Commencing on the first day of March, 2004 and on the first day of
     each and every month  thereafter,  Maker shall pay to Payee the  principal,
     together  with  interest  accruing  hereunder at the Rate,  in arrears,  in
     amortized,  consecutive,  and successive monthly installments sufficient to
     repay the principal  balance of this Note,  together with interest accruing
     thereon at the Rate,  in full over a twenty (20) year  amortization  period
     (the "Amortization Period"), provided, however, interest on this Note shall
     be calculated  on the basis of a three  hundred  sixty (360) day year,  and
     charged for the actual number of days  elapsed.  Provided,  however,  Payee
     shall  recalculate  the  amount  of  the  monthly  principal  and  interest
     installment  due on this Note on the first day of the first month following
     the  effective  date of any change in the Rate.  The  recalculated  monthly
     installment shall be equal to the monthly  installment  sufficient to repay
     the principal  balance Maker is expected to owe as of the effective date of
     any change in the Rate,  together  with  interest  accruing  thereon at the
     Rate,  in full over the  remaining  portion  of the  original  Amortization
     Period.


<PAGE>

          (c) Notwithstanding the foregoing,  and unless sooner paid, the entire
     outstanding  principal  amount of this  Note,  together  with all  interest
     accrued and not  theretofore  paid,  and all other sums payable  hereunder,
     shall be due and payable in full on January 13, 2024 (the "Maturity Date").

2. Security.  The payment of this Note,  and the  performance by Maker of all of
its  obligations  under the  commitment  letter  dated  December  19,  2003 (the
"Commitment Letter"), and the Loan Agreement are secured by, among other things:

           (a) a certain  Open-End Mortgage and Security  Agreement,  dated even
     date herewith (the Mortgage),  secured upon certain real property  premises
     currently  occupied  by  Spitz,  Inc.,  located  at  Route 1,  Chadds  Ford
     Township,  Delaware County,  Pennsylvania,  being Folio No. 04-00-00034-02,
     and more specifically  described on the metes and bounds legal description,
     attached to the Mortgage and labeled Exhibit A, and all improvements now or
     hereafter placed or made thereon and thereto (the Mortgage  Premises),  and
     creating a security interest under the Pennsylvania Uniform Commercial Code
     in all fixtures, equipment and other tangible personal property, including,
     but not  limited  to, all  machinery,  appliances,  furnishings,  tools and
     building  materials now or hereafter  acquired by Maker and installed or to
     be installed upon, or used or to be used in connection  with, the Mortgaged
     Premises;

          (b)  those  certain  UCC-1  Financing  Statements,   dated  even  date
     herewith,  identifying  Maker  as  Debtorand  Payee as the  Secured  Party,
     securing  Payee's  interest  in and to all  fixtures,  equipment  and other
     tangible personal property,  including,  but not limited to, all machinery,
     appliances,  furnishings,  tools and  building  materials  now or hereafter
     acquired by Maker and  installed or to be installed  upon, or used or to be
     used in connection with the Mortgaged Premises;


          (c) an  Assignment  of Rents,  Profits  and  Leases,  dated  even date
     herewith,  pursuant to which Spitz, Inc. has collaterally assigned to Payee
     all of its  right,  title and  interest  in and to all rents,  profits  and
     income  arising  from the  Mortgaged  Premises  and from all  leases now or
     hereafter  in effect  pertaining  to all or any  portion  of the  Mortgaged
     Premises, and;

          (d) a Collateral Assignment of Agreements Affecting Real Estate, dated
     even date herewith,  pursuant to which Maker has  collaterally  assigned to
     Payee all of Maker's  right,  title and  interest in and to all  approvals,
     permits,  contracts and warranties,  now or hereafter in effect, pertaining
     to all or any portion of the Mortgaged Premises.

     All of the agreements,  conditions,  covenants and provisions  contained in
the Commitment Letter,  the Loan Agreement,  and the documents listed in clauses
(a)  through  (d)  above  (hereinafter  referred  to  collectively  as the "Loan
Documents)  are hereby  made a part of this Note to the same extent and with the
same force and effect as if they were fully set forth  herein.  Maker  covenants
and  agrees to keep and  perform,  or cause to be kept and  performed,  all such
agreements,  conditions,  covenants and provisions,  strictly in accordance with
their terms.

3. Late Charge.  Maker is obligated to make payments of interest or principal or
both on the above specified due dates in accordance with the terms of this Note


                                       2
<PAGE>

without  defalcation or setoff and without notice or demand,  and the failure to
receive  any notice or demand  from Payee  shall not be a defense  to, or excuse
for, the failure to make such payments on the due dates.  If any  installment of
interest or principal or both, or any other payment required  hereunder or under
any of the Loan  Documents  is not paid within  fifteen  (15) days after the due
date of such installment, or payment, a late charge equal to the greater of: (a)
five  percent  (5.00%) of such  overdue  amount;  or (b)  seventy-five  ($75.00)
Dollars  will be due and  payable  to  Payee  to cover  the  additional  expense
incident to such  delinquency.  This shall not be construed to obligate Payee to
accept any overdue  installment (i.e., any payment remaining unpaid for a period
of five (5) days after  written  notice of failure to pay the same when due) nor
to limit Payee's rights and remedies for Maker's  default,  as  hereinafter  set
forth.

4. Default.  Maker shall be in default  hereunder  upon the occurrence of any of
the following events (an "Event of Default):  (i) any installment of interest or
principal  and  interest,  or any other  sum  required  hereunder,  or any other
payment required under any of the Loan Documents,  remains unpaid for the period
of five (5) days  after  written  notice of  failure to pay the same when due in
accordance with the provisions  hereof or under any of the Loan Documents;  (ii)
after the  expiration of any  applicable  notice and cure  periods,  if any, the
default by Maker under any of the Loan  Documents;  (iii) the  institution by or
against Maker of any bankruptcy, insolvency,  reorganization,  arrangement, debt
adjustment,  receivership,  liquidation  or  dissolution  proceeding  which,  if
instituted  against any such party, is consented to by such party or remains not
dismissed  or stayed for sixty (60) days;  (iv) the  adjudication  of Maker as a
bankrupt  or the  appointment  of a trustee or  receiver  for all or any part of
Maker's  property;  (v) the making by Maker of an assignment  for the benefit of
creditors;  (vi) the  admission by Maker of an inability to pay  his/her/its  or
their debts as they become due;  (vii) after the  expiration  of any  applicable
notice and cure periods, if any, the default by Maker or any affiliate, owner or
subsidiary thereof, in making any payment for money owed or borrowed by Maker or
any affiliate,  owner or subsidiary thereof including,  without limitation,  the
occurrence  of an event of default  under that certain Line Of Credit  Agreement
dated  June  12,  1997  between  Payee  and  Maker,   amended  by  that  certain
Modification  Agreement  dated July 7, 2000, and further amended by that certain
Second  Modification  Agreement  dated July 18,  2002,  respecting a Two Million
($2,000,000.00)  Dollar commercial revolving line of credit; (viii) the untruth,
in any respect regarded by Payee as material,  of any warranty,  representation,
certification,  financial  statement or other  information  made or furnished by
Maker  in  connection  with the loan  made by  Payee  to Maker  pursuant  to the
Commitment  Letter and the Loan  Agreement;  or (ix) the sale or transfer of any
right, title, or interest,  legal or equitable, in the Mortgaged Premises or any
part or parcel  thereof or a change of the  majority of the members of the board
of directors of Maker during any twelve (12) month period.

5.  Remedies.  Upon the  occurrence  of any Event of Default,  the entire unpaid
balance of principal  (including any additional  loans or advances and all other
sums  paid by Payee to or on behalf  of Maker or added to the  principal  hereof
pursuant  to the  terms  of this  Note or any of the Loan  Documents),  with all
accrued interest thereon,  together with an attorney's commission for collection
of the greater of Five Thousand  ($5,000.00) Dollars or five (5%) percent of the
total indebtedness, and all other sums due and owing hereunder or under the Loan
Documents,  shall,  at the option of Payee,  become  immediately due and payable
without  presentment,  demand or  further  action  of any kind,  and one or more
executions may forthwith  issue on any judgment or judgments  obtained by virtue
of any  provision of this Note or otherwise  obtained and any security  given to


                                       3
<PAGE>

secure  the  obligation  evidenced  by this  Note  may  thereupon  forthwith  be
enforced,  and Payee may also  recover  all costs of suit and other  expenses of
collection involving,  but not limited to, reasonable attorney's fees, the costs
of title searches, the costs of eviction of any tenants and re-appraisals.

     The rights and remedies  provided  herein or in the Loan Documents shall be
cumulative  and  concurrent  and shall not be  exclusive  of any right or remedy
provided by law, in equity or  otherwise.  Said rights and remedies  may, at the
sole discretion of Payee,  be pursued singly,  successively or together as often
as occasion therefor shall arise, against Maker and/or the Mortgaged Premises or
any other security for this Note, as applicable. No failure on the part of Payee
to exercise any of such rights or remedies  shall be deemed a waiver of any such
rights or remedies or of any Event of Default hereunder.

     Upon the occurrence of an Event of Default, Payee shall have the right, but
not the duty, to cure such default, in part or in its entirety,  and all amounts
expended or debts incurred by Payee, including reasonable attorneys' fees, shall
be deemed to be advances  to Maker,  shall be added to the  principal  due under
this Note,  shall be secured by the security for this Note, and shall be payable
by Maker to Payee upon demand with  interest  at the Default  Rate  (hereinafter
defined).

6. Default  Rate.  Upon the  occurrence of an Event of Default,  interest  shall
continue to accrue  thereafter  at the  default  rate of the Rate plus five (5%)
percent  per  annum  (the  Default  Rate)  until  this  Note,  and all  sums due
hereunder,  are paid in full,  including  the period  following the entry of any
judgment.  Interest  after the  occurrence of an Event of Default at the Default
Rate shall be  calculated  on the basis of a three hundred sixty (360) day year,
but charged for the actual number of days elapsed.

7. WARRANT OF ATTORNEY.  THE FOLLOWING  SECTION SETS FORTH  WARRANTS OF ATTORNEY
FOR ANY ATTORNEY TO CONFESS  JUDGMENTS AGAINST MAKER. IN GRANTING THESE WARRANTS
OF  ATTORNEY  TO  CONFESS  JUDGMENTS  AGAINST  MAKER,  MAKER  HEREBY  KNOWINGLY,
INTENTIONALLY,  VOLUNTARILY,  AND  UNCONDITIONALLY  WAIVE(S)  ANY AND ALL RIGHTS
MAKER  MAY HAVE TO  PRIOR  NOTICE  AND AN  OPPORTUNITY  FOR  HEARING  UNDER  THE
RESPECTIVE  CONSTITUTIONS  AND LAWS OF THE  COMMONWEALTH OF PENNSYLVANIA AND THE
UNITED STATES OF AMERICA.

     UPON THE OCCURRENCE OF AN EVENT OF DEFAULT,  MAKER, WITHOUT FURTHER CONSENT
OR NOTICE, DOES HEREBY IRREVOCABLY AND UNCONDITIONALLY AUTHORIZE AND EMPOWER ANY
ATTORNEY  OF THE  PROTHONOTARY  OF ANY COURT OF RECORD  OF THE  COMMONWEALTH  OF
PENNSYLVANIA  OR  ELSEWHERE  TO APPEAR FOR MAKER IN ANY SUCH COURT,  AND WITH OR
WITHOUT A COMPLAINT OR  DECLARATION  FILED,  IN AN  APPROPRIATE  ACTION  BROUGHT
AGAINST MAKER ON THIS NOTE, TO ENTER AND CONFESS JUDGMENT AGAINST MAKER IN FAVOR
OF PAYEE OR ITS  SUCCESSORS  AND  ASSIGNS,  FOR ALL OR ANY PORTION OF THE ENTIRE
AMOUNT DUE TO PAYEE UPON SUCH EVENT OF DEFAULT AS PROVIDED HEREIN, TOGETHER WITH
COSTS OF SUIT AND ATTORNEYS'  COMMISSION IN AN AMOUNT EQUAL TO FIVE (5%) PERCENT


                                       4
<PAGE>

OF THE PRINCIPAL AMOUNT  OUTSTANDING  UNDER THIS NOTE, BUT IN NO EVENT LESS THAN
FIVE THOUSAND  ($5,000.00)  DOLLARS; AND FOR SO DOING THIS NOTE OR A COPY HEREOF
VERIFIED BY  AFFIDAVIT  SHALL BE A  SUFFICIENT  WARRANT.  THE  AUTHORITY  HEREIN
GRANTED TO APPEAR,  ENTER AND CONFESS JUDGMENT SHALL NOT BE EXHAUSTED BY ANY ONE
OR MORE  EXERCISE  THEREOF  OR BY ANY  DEFECTIVE  EXERCISE  THEREOF,  BUT  SHALL
CONTINUE  AND BE  EXERCISABLE  FROM TIME TO TIME  UNTIL THE FULL  PAYMENT OF ALL
AMOUNTS DUE FROM MAKER TO PAYEE  HEREUNDER AND UNDER THE LOAN DOCUMENTS IS MADE.
THE  FOREGOING  RIGHT AND REMEDY IS IN  ADDITION TO AND NOT IN LIEU OF ANY OTHER
RIGHT OR REMEDY AVAILABLE TO PAYEE UNDER THIS NOTE OR OTHERWISE.

     MAKER  ACKNOWLEDGES  HAVING  HAD THE  ASSISTANCE  OF LEGAL  COUNSEL  OR THE
OPPORTUNITY TO RETAIN LEGAL COUNSEL IN THE REVIEW AND EXECUTION OF THIS NOTE FOR
THE PURPOSE OF  EXPLAINING  THE MEANING AND EFFECT OF THE  FOREGOING  PROVISIONS
CONCERNING CONFESSION OF JUDGMENT, AND FURTHER ACKNOWLEDGES THAT THE MEANING AND
EFFECT OF THE FOREGOING PROVISIONS  CONCERNING  CONFESSION OF JUDGMENT HAVE BEEN
EITHER FULLY  EXPLAINED TO MAKER BY SUCH  COUNSEL OR FULLY  UNDERSTOOD  BY MAKER
WITHOUT  RELIANCE ON PAYEE IF MAKER HAS ELECTED NOT TO BE  REPRESENTED  BY LEGAL
COUNSEL AND AS EVIDENCE OF SUCH FACT SIGNS HIS/HER/THEIR/ITS INITIALS.

                          /s/ PLD                            /s/ JAS
                    (Initials of Maker)                (Initials of Maker)

     Maker  hereby  waives  the  benefit  of any laws now or  hereafter  enacted
providing for any stay of execution,  marshaling of assets, exemption from civil
process, redemption, extension of time for payment, or valuation or appraisement
of all or any part of the  Mortgaged  Premises  or any other  security  for this
Note,  exempting all or any part of the Mortgaged  Premises,  any other security
for this Note or any other property of Maker from attachment,  levy or sale upon
any such execution or conflicting  with any provision of this Note or any of the
Loan  Documents.  Maker waives and releases Payee and said attorney or attorneys
from all errors,  defects and  imperfections  whatsoever in confessing  any such
judgment or in any proceedings relating thereto or instituted by Payee hereunder
or under any of the Loan  Documents.  Maker hereby agrees that any property that
may be levied upon pursuant to a judgment  obtained  under this Note may be sold
upon any execution thereon in whole or in part, and in any manner and order that
Payee, in its sole discretion may elect.

8. Prepayment. Upon giving Payee at least thirty (30) days prior written notice,
Maker may prepay all or any portion of the outstanding principal balance of this
Note by paying,  in  addition  to (i) the  prepaid  principal  amount,  (ii) all
accrued  and  unpaid  interest  to the date of  prepayment,  and (iii) all other
amounts due under this Note, a prepayment premium ("Prepayment Premium) equal to
the greater of:

                                       5
<PAGE>


     (a)  the product obtained  multiplying (1) the difference  between the then
          Rate and the  yield  rate of that U.S.  Treasury  Note the due date of
          which  is  closest  to  (either  before,  after  or on) the end of the
          current  three (3) year fixed rate period of this Note (the Period End
          Date) (however,  if the period between the Period End Date and the due
          date exceeds six(6) months,  the average of the yield rates of the two
          U.S.  Treasury  Notes with due dates next  preceding and following the
          Period End Date shall be used to compute such difference; and if there
          are two or more U.S.  Treasury Notes with the same due dates, that one
          with a whole  yield rate  closest to the Rate shall be used to compute
          such  difference)  as reported  in the Wall Street  Journal or similar
          publication  on the fifth (5th)  business day preceding the prepayment
          date,  and (2) the  number of whole  and  fractional  years  remaining
          between  the  prepayment  date and the  Period  End Date,  and (3) the
          prepaid principal amount; or

     (b)  one (1%) percent of the prepaid principal amount.

     Prepayment shall mean any event whereby the indebtedness  evidenced by this
Note is paid in advance of the payment  schedule or fully satisfied prior to the
Maturity Date in any manner, whether voluntary or involuntary, including without
limitation  any payment  after  default,  any payment after the Maturity Date is
accelerated,  or any payment under court order or bankruptcy  proceeding.  Payee
shall not be required to accept ay prepayment if it does not include  payment of
the  required  Prepayment  Premium.   Notwithstanding  anything  herein  to  the
contrary,  Maker may during each  calendar  year,  upon giving Payee thirty (30)
days prior written notice, prepay, in the aggregate,  an amount equal to or less
than ten (10%) percent of the outstanding  principal balance of the indebtedness
evidenced by this Note  determined as of January 1 of each calendar year without
liability for the payment of any Prepayment Premium.

     Notwithstanding  the  foregoing,  no  Prepayment  Premium  will  be due and
payable (i) in the event of the receipt and  retention  by the Payee of proceeds
from any  casualty  loss or  condemnation  (ii)  during the last 120 days of any
three  (3) year  term of this  Note or (iii) as a result of the sale of all or a
portion of the  Mortgaged  Premises  to an  unaffiliated  third party in an arms
length transaction.

     All prepayments shall first be applied to the Prepayment  Premium,  then on
account of interest  accrued  hereunder and other sums due hereunder  other than
principal,  with the balance applied to principal.  No partial  prepayment shall
postpone or  interrupt  payments  of  interest  or the payment of the  remaining
principal  balance,  all of which  shall  continue  to be due and payable at the
times and in the manner set forth above.

9. Waiver.  The Maker and all other  endorsers,  sureties and guarantors  hereby
jointly  and  severally  waive  presentment  and demand for  payment,  notice of
demand, notice of default (except as required in this Note), notice of dishonor,
protest and notice of protest of this Note,  and all other notices in connection
with the  delivery,  acceptance,  performance,  default  or  enforcement  of the
payment of this Note,  and also waive  notice of the  exercise of any options on
the part of Payee hereunder.

     The  granting,  with or without  notice,  of any extension or extensions of
time for  payment  of any sum or sums due  hereunder,  or under  any of the Loan


                                       6
<PAGE>

Documents,  or for the  performance  of any  covenant,  provision,  condition or
agreement  contained herein or therein, or the granting of any other indulgence,
or the taking or releasing or subordinating of any security for the indebtedness
evidenced hereby, or any other  modification or amendment of this Note or any of
the Loan Documents,  will in no way release or discharge the liability of Maker,
whether or not granted or done with the knowledge or consent of Maker.

     Payee shall not be deemed,  by any act of omission or  commission,  to have
waived any of its rights or remedies hereunder, under any of the Loan Documents,
at law or in equity,  unless such waiver is in writing and signed by Payee,  and
then only to the extent  specifically  set forth in the writing.  A waiver as to
one event shall not be construed as  continuing  or as a bar to or waiver of any
right or remedy as to a subsequent event.

10. Joint and Several  Liability.  The obligations and liabilities  hereunder of
the persons or entities referred to as "Maker" shall be joint and several.

11. Notice.  Regular  monthly  payment  invoices and notice of any change in the
monthly  installment of principal and interest due under this Note shall be sent
by regular mail,  postage prepaid,  to the address of Maker set forth above. All
other notices and other  communications  required or given under this Note shall
be given in the manner and to the addresses set forth in the Loan Agreement

12. Miscellaneous.  Notwithstanding any other provision contained herein, if, at
any time, the Rate or the Default Rate shall be deemed by any competent court of
law,  governmental  agency or tribunal  to exceed the  maximum  rate of interest
permitted by any applicable laws, then, for such time as the Rate or the Default
Rate would be deemed  excessive,  its  application  shall be suspended and there
shall be charged instead the maximum rate of interest permitted under such laws.
Any amounts  theretofore  received by Payee  hereunder  in excess of the maximum
rate of  interest so  permitted  shall be applied by Payee in  reduction  of the
outstanding  principal  balance  of  this  Note,  or if  this  Note  shall  have
theretofore  been paid in full,  the amount of such  excess  shall  promptly  be
returned by Payee to Maker.

     In the event any  portion  of this Note shall be  declared  by any court of
competent  jurisdiction  to be invalid or  unenforceable,  such portion shall be
deemed  severable from this Note, and the remaining parts hereof shall remain in
full force and effect, as fully as though such invalid or unenforceable  portion
was never part of this Note.

     The  obligations of Maker  hereunder shall be binding on the successors and
assigns of Maker, and the benefits of this Note shall inure to Payee, its
successors and assigns and to any holder of this Note.

     Each and every  person or entity  signing  this Note as an  endorser  binds
himself, herself or itself as principal not as surety, and agrees to be bound by
and comply with all of the terms, conditions and provisions of this Note.

                                       7
<PAGE>

     Nothing herein contained or contained in any of the Loan Documents shall be
construed to create a partnership or joint venture between Payee and
Maker, or to render Payee in any way responsible for the debts or losses of
Maker.

     This Note,  and all issues  arising  hereunder,  shall be  governed  by and
construed according to the laws of the Commonwealth of Pennsylvania.

     MAKER AND PAYEE HEREBY KNOWINGLY,  VOLUNTARILY AND INTENTIONALLY  WAIVE ANY
RIGHT  EITHER  MAY HAVE TO A TRIAL BY JURY IN RESPECT  OF ANY  LITIGATION  BASED
HEREON,  OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE, THE MORTGAGE,
ANY  OTHER  DOCUMENT  OR  INSTRUMENT  RELATING  HERETO  OR  THERETO,  ANY  OTHER
TRANSACTIONS  CONTEMPLATED HEREBY OR THEREBY OR ANY COURSE OF CONDUCT, COURSE OF
DEALING,  STATEMENTS  (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE PAYEE OR THE
MAKER  IN  CONNECTION  HEREWITH  OR  THEREWITH.  THIS  PROVISION  IS A  MATERIAL
INDUCEMENT FOR THE PAYEE TO MAKE THE LOAN EVIDENCED BY THIS NOTE.





         [THIS SPACE INTENTIONALLY LEFT BLANK. SIGNATURE PAGE FOLLOWS.]


                                       8
<PAGE>

     IN WITNESS  WHEREOF,  Maker has caused  this Note to be duly  executed  and
sealed this 14th day of January, 2004.

WITNESSES:                            MAKER:

                                      SPITZ, INC.
/s/ Maria Pantano Bucci
/s/ Donn L. Guthrie
   WITNESS AS TO ALL
                                   BY:    /s/ Jonathan Shaw             (SEAL)
                                       ------------------------------


                               ATTEST:    /s/ Paul Dailey                (SEAL)
                                       ------------------------------


                                      TRANSNATIONAL INDUSTRIES, INC.



                                   BY:      /s/ Jonathan Shaw            (SEAL)
                                       -------------------------------


                                ATTEST:       /s/ Paul Dailey            (SEAL)
                                       -------------------------------



                                       9