TERM PROMISSORY NOTE
$500,000.00         Minneapolis, Minnesota
Due:  May 1, 2001   May 9, 1996

LOAN AMOUNT AND INTEREST RATE. FOR VALUE RECEIVED, NORTH ATLANTIC TECHNOLOGIES,
INC., a Minnesota corporation (collectively, the "Maker") promises to pay to the
order of, FIRST BANK NATIONAL ASSOCIATION a national banking association (the
"Lender"), its successors and assigns, at its office at First Bank Place, 601
Second Avenue South, Minneapolis, Minnesota 55402, or such other place as the
holder hereof may designate in writing from time to time, the principal sum of
Five Hundred Thousand and No/100 Dollars ($500, 000.00), in lawful money of the
United States, together with interest from the date hereof on the unpaid balance
hereof from time to time outstanding at One and Three-Quarters percent (1.75%)
in excess of the Index Rate as defined in the Amended and Restated Credit
Agreement of even date herewith ("Credit Agreement").

PAYMENT SCHEDULE. This Note shall be payable in the following manner: 

Principal and interest shall be due and payable in consecutive monthly
installments in the amount of $10,100.00, each on the first day of each calendar
month, with the first such installment due June 1, 1996. The Lender reserves the
right to adjust such payment amount at its option to reflect any change to the
interest rate as set forth in paragraph 1, above. All outstanding principal and
accrued interest hereon shall be due and payable on May 1, 2001.

Each payment made under this Note shall be applied, first, to the amount then
due for any expenses, costs, or other expenditures incurred by the Lender in
connection with this Note and payable by the Maker, second, to any accrued
interest then due under this Note, and third, to any principal then due under
this Note, and any balance thereafter to principal.

Any payment due on any non-business day of the Lender shall be due upon (and
interest shall accrue to) the next business day.

LATE CHARGE. Any installment payment not made by the Maker within ten (10) days
of the due date thereof shall be subject to a late payment charge equal to five
percent (5%) of such installment. The late charge shall apply individually to
all payments past due with no daily adjustment and shall be used to defray the
costs incurred by the Lender in connection with the collection of such late
payment. This provision shall not be deemed to excuse a late payment or be
deemed a waiver of any other rights the Lender may have, including the right to
declare the entire unpaid principal and interest under this Note immediately due
and payable.

PREPAYMENT PRIVILEGE. The principal of this Note may be prepaid in full or in
part at any time, without premium or penalty. Each such prepayment shall be
accompanied by the interest accrued on the amount prepaid to the date of the
prepayment. All prepayments shall be applied to the payment of scheduled
installments of principal due hereunder in the reverse order of their maturity
except that if any advance made by the Lender to the Maker under any agreement
or document has not been repaid, or if any amount is then due under any other
obligation of the Maker to the Lender, the Lender may, at its option, apply any
payment made by the Maker to repay such unpaid advance or obligation and
interest thereon, and the balance, if any, shall be applied as a prepayment of
amounts not yet due under this Note.

DEFAULT INTEREST RATE. Upon the earlier to occur of (a) the acceleration of the
indebtedness evidenced hereby, or (b) the occurrence of a default in any payment
due hereunder which is not cured within thirty (30) days of the due date, the
interest rate shall thereafter increase and shall be payable on the whole of the
unpaid principal balance, interest and other charges, at a rate equal to the
lesser of (i) two percent (2%) per annum in excess of the rate of interest then
in effect under the terms of this Note or (ii) the highest rate permitted under
applicable law if such rate is lower (hereinafter referred to as the "Default
Rate"). The Default Rate shall continue until reinstatement of the loan, payment
in full of all indebtedness evidenced by this Note, or the completion of all
foreclosure proceedings and redemption periods, whichever shall occur first.
This provision shall not be deemed to excuse an Event of Default nor be deemed a
waiver of any other rights the Lender may have including the right to declare
the entire unpaid principal and interest under this Note immediately due and
payable.

CREDIT AGREEMENT. This Note is the Term Note issued pursuant to the terms and
provisions of the Credit Agreement dated of even date herewith between the Maker
and the Lender, as the same may be amended, modified, restated or replaced from
time to time as agreed upon in writing by the Lender, and this Note and the
holder hereof are entitled to all of the benefits provided for in the Credit
Agreement, or referred to therein. Reference is made to the Credit Agreement for
a statement of the terms and conditions under which this indebtedness was
incurred and is to be repaid and under which the due date of this Note may be
accelerated. The provisions of the Credit Agreement are hereby incorporated by
reference with the same force and effect as if fully set forth herein.

SECURITY. This Note is secured by, inter alia, a security interest in all assets
of Maker, a pledge agreement of Willis D. Heim, and the personal guaranty of
Willis D. Heim.

DEFAULT AND ACCELERATION. If an Event of Default, as defined in the Credit
Agreement or any other agreement made by any party in connection with this Note,
shall occur, or if any portion of the indebtedness evidenced hereby is not paid
when due, the Lender or other holder may, without notice, demand, presentment
for payment and/or notice of nonpayment, all of which Maker hereby expressly
waives, declare the indebtedness evidenced hereby and all other indebtedness and
obligations of the Maker to the Lender or holder hereof immediately due and
payable and the Lender or other holder hereof may, without notice, immediately
exercise any right of setoff and enforce any lien or security interest securing
payment hereof. The foregoing shall be in addition to the rights of acceleration
that may be provided in any loan agreement, security agreement, mortgage and/or
other writing relating to the indebtedness evidenced hereby. If this Note is
placed with any attorney(s) for collection upon any default, the Maker agrees to
pay to the Lender or holder, its reasonable attorneys fees and all lawful costs
and expenses of collection, whether or not a suit is commenced.

WAIVER. Time is of the essence. No delay or omission on the part of the Lender
or other holder hereof in exercising any right or remedy hereunder shall operate
as a waiver of such right or of any other right or remedy under this Note or any
other document or agreement executed in connection herewith. All waivers by the
Lender must be in writing to be effective and a waiver on any occasion shall not
be construed as a bar to or a waiver of any similar right or remedy on a future
occasion.

The makers, endorsers, sureties, guarantors and all other persons liable for all
or any part of the indebtedness evidenced by this Note jointly and severally
waive presentment for payment, protest and notice of nonpayment. Such parties
hereby consent without affecting their liability to any extension or alteration
of the time or terms of payment hereon, any renewal, any release of all or any
part of the security given for the payment hereof, any acceptance of additional
security of any kind, and any release of, or resort to any party liable for
payment hereof and such parties shall remain bound in the same capacities as
prior thereto upon each such event.

ADDITIONAL SECURITY. As additional security for this Note, the Maker and any
other party to this Note hereby grant to the Lender a security interest in any
deposits or other sums at any time credited by or due from the Lender to any
maker, endorser or guarantor hereof and any securities or other property of any
maker, endorser or guarantor hereof in the possession of the lender or other
holder of this Note. The Lender or other holder hereof may apply or set off such
property, deposits or other sums against the obligations hereunder at any time
in case of makers, but only with respect to matured liabilities in the case of
endorsers or guarantors.

JURISDICTION. This Note represents a loan negotiated, executed and to be
performed in the State of Minnesota and shall be construed, interpreted and
governed by the law of said state. The Maker hereby consents to the personal
jurisdiction of the state and federal courts located in the State of Minnesota
in connection with any controversy related to this Note, waives any argument
that venue in such forums is not convenient and agrees that any litigation
instigated by the Maker against the Lender in connection with this Note shall be
venued in the federal or state court that has jurisdiction over matters arising
in Minneapolis, Minnesota.

JOINT AND SEVERAL LIABILITY. If this Note is executed by more than one maker,
each maker agrees to be jointly and severally liable hereon, and the release by
the Lender or other holder hereof, of one or more of such maker shall not
release or diminish the liability of the remaining makers hereof.

INTEREST LIMITATION. All agreements between the Maker and the Lender are hereby
expressly limited so that in no contingency or event whatsoever, whether by
reason of acceleration of maturity of the indebtedness evidenced or secured
thereby or otherwise, shall the rate of interest charged or agreed to be charged
to the Lender for the use, forbearance, loaning or detention of such
indebtedness exceed the maximum permissible interest rate under applicable law
("Maximum Rate"). If for any reason or in any circumstance whatsoever
fulfillment of any provision of this Note, any document securing or executed in
connection with this Note, or any other agreement between the Maker and the
Lender, at any time shall require or permit the interest rate applied thereunder
to exceed the Maximum Rate, then the interest rate shall automatically be
reduced to the Maximum Rate, and if the Lender should ever receive interest at a
rate that would exceed the Maximum Rate, the amount of interest received which
would be in excess of the amount receivable after applying the Maximum Rate to
the balance of the outstanding obligation shall be applied to the reduction of
the principal balance of the outstanding obligation for which the amount was
paid and not to the payment of interest thereunder. This provision shall control
every other provision of any and all agreements between the Maker and the Lender
and shall also be binding upon and available to any subsequent holder of this
Note.

IN WITNESS WHEREOF, the Maker has executed and delivered this Note to the Lender
as of the day and year first above written.
NORTH ATLANTIC TECHNOLOGIES, INC., a Minnesota corporation

By

Its
Dated:  May _____, 1996

ACKNOWLEDGMENT
STATE OF MINNESOTA  )
                    )
COUNTY OF HENNEPIN  )

     The foregoing instrument was acknowledged before me this _____ day
__________ 1996, by ______________________________, the
__________________________ of NORTH ATLANTIC TECHNOLOGIES, INC., a Minnesota
corporation.


                                   Notary Public