STEELCLOUD,
INC.

    REVOLVING
LINE OF CREDIT PROMISSORY NOTE

    


    
      	
              $150,000.00

            	
              Herndon,
      Virginia

            	
              November
      3, 2009

            


    

    


         FOR
VALUE RECEIVED, the undersigned SteelCloud, Inc., a Virginia corporation
("Borrower"), promises to pay to Caledonia Capital Corporation, a Delaware
corporation ("Lender" and, together with Borrower hereinafter collectively
referred to as "Parties"), the principal sum of ONE HUNDRED FIFTY THOUSAND AND
NO/100 DOLLARS ($150,000.00), or so much thereof as may from time to time be
advanced, together with interest accrued on the unpaid principal balance hereof
as set forth below.

     

    1.           Interest Rate;
Payments.  Commencing on the date hereof and continuing until
this Note is paid in full, the unpaid principal amount from time to time
outstanding under this Note shall accrue interest at a rate of interest equal to
fifteen percent per annum (15%) (the “Contract Rate”).  Accrued
interest under this Note shall be payable in monthly installments commencing
thirty (30) days after the date hereof and continuing on the same day of each
successive calendar month thereafter until this Note has been paid in
full.    Interest shall be calculated on a daily based on
the principal amount outstanding and unpaid on each day.  All interest
calculations under this Note shall be made on the basis of a three hundred sixty
(360) day year and actual days elapsed

     

    2.           Payment of
Principal.  If not sooner paid, the entire principal balance
remaining unpaid, together with interest accrued and unpaid thereon and all
other sums due hereunder, shall be due and payable in full upon the earlier to
occur of (a) March 31, 2010 (the “ Maturity Date”), or (b) the date that the
Borrower shall have raised a total of not less than $1,000,000 in New Equity
Capital (defined below) from one or more investors (“Capitalization
Date”).  For the purposes of this clause, New Equity Capital shall be
defined as capital invested in the equity of the Borrower accompanied by the
issuance by Borrower of shares of stock which were not trading in the public
markets prior to the date of this Note.  This Note may be prepaid in
whole or in part at any time without penalty or premium.  Each payment
by Borrower to Lender on this Note shall be applied first to costs, if any,
pursuant to Section 8 hereof and then applied to any accrued interest, and then
any remaining portion of the payment after such applications shall be applied to
reduction of outstanding principal balance of this Note.  All payments
made under this Note shall be made to the Lender at 19441 Golf Vista Plaza,
Suite 360, Leesburg, VA  20176, or at such other address as the Lender
may direct by notice to Borrower.  Payments shall be deemed made upon
receipt.

     

    3.           Revolving
Note.  This Note is a "revolving line of credit"
note.  Principal advances may be made, from time to time, by Lender up
to the principal amount of this Note, and principal payments may be made, from
time to time, by Borrower to reduce the principal balance owing pursuant to this
Note.  In no event shall any principal advance be made after the
Maturity Date.  The initial advance shall be $60,000 and shall be
advanced upon execution of this Note and the Agreement referenced in Section 4
by Borrower.  All advances and all payments made on account of
principal shall be endorsed by the holder on the attached schedule to this Note
(“Schedule A”).


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


         4.   Line of Credit
Agreement.  This Note is issued pursuant to, is entitled to the
benefit of, and is subject to the provisions of Line of Credit Agreement (the
"Agreement") between Borrower and Lender dated the same date as this
Note.

     

         5.   Events of
Default.  The outstanding principal and accrued interest hereon
shall mature and become automatically due and payable, without notice or demand,
upon the occurrence of any of the following Events of Default:

     

    
      	
              
              

            	
              a)

            	
              The
      failure by Borrower to make a payment of any principal or interest on the
      Note within ten (10) days after the same becomes due and
      payable;

            


    

    
      
         

        
          	
                	
                  b)

                	
                  The
      failure by Borrower to perform any of its obligations, except the payment
      of principal and interest, arising under this Note, the Agreement or any
      other agreement between Borrower and Lender within five (5) days after
      receipt of written  notice of such failure;
  or

                


        

      

    

    
      
         

        
          	
                	
                  c)

                	
                  The
      filing by or against the Borrower of a voluntary or involuntary proceeding
      seeking liquidation, reorganization or other relief with respect to
      Borrower or its debts under any bankruptcy, insolvency or other similar
      law now or hereafter in effect or seeking the appointment of a trustee,
      receiver, liquidator, custodian or other similar official for Borrower or
      any substantial part of its property and, in the case of any involuntary
      proceeding not consented to by Borrower, such proceeding is not dismissed
      within sixty (60) days of its
filing;

                


        

      

    

    
      
         

        
          	
                	
                  d)

                	
                  If
      all or a substantial portion of Borrower’s assets become subject to writ
      of attachment, writ of execution or any other lien, and such writ or lien
      is not released within twenty (20) calendar days;
  or

                


        

      

    

    
      
         

        
          	
                	
                  e)

                	
                  A
      default shall occur under that certain Secured Promissory Note in the
      original principal amount of $250,000 from Lender to Borrower dated July
      1, 2009.

                


        

      

    

     

    6.           Remedies.  The
following remedies are available to Lender if an Event of Default has occurred
under this Note: (a) the outstanding principal and accrued interest under the
Note shall mature and become automatically due and payable, without notice or
demand; and (b) Lender may exercise any other remedies available to it at law or
in equity.

     

    7.           Waiver.  Borrower,
sureties, endorsers, guarantors and any other party now or hereafter liable for
the payment of this Note, in whole or in part, hereby severally (a) waive
presentment for payment, notice of nonpayment, protest, notice of protest,
notice of intent to accelerate, notice of acceleration and all other notices,
filing of suit and diligence in collecting this Note or enforcing any other
security with respect to same, (b) agree to any substitution, subordination,
exchange or release of any such security or the release of any parties primarily
or secondarily liable hereon, (c) agree that the Lender shall not be required
first to institute suit or exhaust its remedies hereon against the Borrower, or
other any party liable or to become liable hereon or to enforce its rights
against any or all of them or any security with respect to same, and (d) consent
to any extension or postponement of time of payment of this Note and to any
other indulgence with respect hereto without notice hereof to any of
them.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    8.           Collection
Fees.  In the event, after default, counsel is employed by the
Lender to collect this obligation or to protect the security hereof, Borrower
hereby agrees to pay the Lender’s attorney's fees so incurred by Lender whether
or not suit be brought, and all other costs and expenses connected with
collection.

     

    9.           Records.  Borrower
hereby appoints Lender as the authorized agent of Borrower with full authority
to record on the Schedule, which is incorporated herein by reference for all
purposes, the dates of each transaction, amounts of all principal advances, as
well as principal and interest payments, made under this Note, and balance due
on the Note.

     

    10.         Notice.  Any
notice required to be provided to Borrower hereunder shall be in writing and
shall be deemed sufficiently given or furnished if delivered by personal
delivery, telecopy, expedited delivery service with proof of delivery, or by
registered or certified United States mail, postage prepaid, at Borrower's
address shown below or at Borrower's most current address on file with
Lender.  Any such notice shall be deemed to have been given at the
time of personal delivery, or in the case of telecopy, upon receipt, or in the
case of delivery service or mail, as of the date of the first attempted delivery
at the address and in the manner provided herein.  Borrower promises
to give Lender prompt notice of any change in Borrower's address.

     

    11.         Miscellaneous.

     

    
      	
            	
              a.

            	
              No
      failure or delay by Lender in exercising any right, power or privilege
      under this Note or the Agreement shall operate as a waiver thereof, nor
      shall any single or partial exercise thereof preclude any further exercise
      thereof or the exercise or any other right, power or
      privilege.

            


    

    
      
        	 	 	 
	
              	
                b.

              	
                The
      captions used in this Note are for convenience only and shall not be
      deemed to amplify, modify or limit any provision
  hereof.

              


      

    

    
      
        	 	 	 
	
              	
                c.

              	
                Words
      of any gender used in this Note shall be construed to include any other
      gender, and words in the singular shall include the plural and vice versa,
      unless the context otherwise
requires.

              


      

    

    
      
        	 	 	 
	
              	
                d.

              	
                This
      Note shall be binding upon and inure to the benefit of the Parties and
      their respective heirs, legal representatives, successors and
      assigns.

              


      

    

    
      
        	 	 	 
	
              	
                e.

              	
                This
      Note, together with the Agreement, contains the entire agreement between
      the Parties with respect to the subject matter hereof and can be altered,
      amended or modified only by a written instrument executed by both
      Parties.

              


      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    
      	
            	
              f.

            	
              This
      Note may be executed in multiple copies, each of which shall be deemed an
      original, and all of such copies shall together constitute one and the
      same instrument.

            


    

    
      
        	 	 	 
	
              	
                g.

              	
                Time
      is of the essence in the performance of each obligation, covenant and
      condition under this Note.

              


      

    

    
      
        	 	 	 
	
              	
                h.

              	
                This
      Note shall be governed by the laws of the Commonwealth of
      Virginia

              


      

    

    
       

      
        	
                12.

              	
                Default Interest and
      Late Fees In
      the event any installment of principal and/or interest due under this Note
      is not actually received by the Lender within fifteen (15) days after the
      date when the same is due, then the Lender shall be entitled to collect a
      "late charge" in an amount equal to five percent (5.0%) of such
      installment.  Time shall be of the essence as to each and every
      provision of this Note.  Any payments of interest and/or
      principal hereunder, not actually received by the Lender within fifteen
      (15) days after the date when the same is due, together with the accrued
      late charges thereon (whether in due course or after acceleration of
      maturity as herein provided for) and all sums advanced or expended by the
      holder for the Borrower's account pursuant to any of the loan documents
      evidencing or securing the loan shall bear interest at the rate of five
      percent (5%) per annum in excess of the interest rate then in effect
      hereunder.

              


      

       

    

    
      
        	
                13.

              	
                Commercial
      Purpose. The Borrower warrants that the loan evidenced by this Note
      is being made solely to acquire or carry on a business or commercial
      enterprise, and/or the Borrower is a business or commercial
      organization.  The Borrower further warrants that all of the
      proceeds of this Note shall be used for commercial purposes and stipulates
      that the loan evidenced by this Note shall be construed for all purposes
      as a commercial loan.

              


      

    

    


    
      WITNESS
the execution hereof by the Borrower on the date first hereinabove
written.


    

    


    
      
        	
                BORROWER:

              
	 
      
	
                STEELCLOUD,
      INC., a Virginia corporation

              
	 
      
	
                By:

              	
                /s/ Brian Hajost

              
	 
      	
                Brian
      Hajost, President

              
	 
      	
                SteelCloud,
      Inc.

              
	 
      	
                13962
      Park Center Road

              
	 
      	
                Herndon,
      VA 20171

              
	 
      


      

    

    
      
        
          
            
              
                 

              

            

          

        

      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    SCHEDULE
A

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      	
                                                              Date of Transaction

                                                            	 	
                                                              Advance Amount

                                                            	 	
                                                              Interest Payments

                                                            	 	
                                                               Principal Payment

                                                            
	 
      	 	 	 	 
      	 	 
      
	
                                                              November  4, 2009

                                                            	 	$	60,000