<PAGE>

                                                                   EXHIBIT 10.27

                             MODIFICATION AGREEMENT

      THIS MODIFICATION AGREEMENT (this "Agreement") is made as of the 11th day
of February, 2000 by and among DUNN COMPUTER CORPORATION, a Virginia
corporation, DUNN COMPUTER CORPORATION, a Delaware corporation, INTERNATIONAL
DATA PRODUCTS, CORP., STMS, INC., PUERTO RICO INDUSTRIAL MANUFACTURING
OPERATIONS ACQUISITION, CORP. and DUNN COMPUTER OPERATING COMPANY (collectively,
the "Borrower") and FIRST UNION NATIONAL BANK, holder of the Note (as defined
below) pursuant to an assignment from First Union Commercial Corporation to
First Union National Bank (the "Lender").

                                    Recitals

      R-1. The Lender extended a revolving line of credit in the original
principal amount of $15,000,000 (the "Line of Credit") to the Borrower pursuant
to a Revolving Line of Credit Loan Agreement and Security Agreement dated May
27, 1999, as amended by an Addendum to Revolving Line of Credit Loan Agreement
and Security Agreement dated May 27,1999 and by a letter agreement dated May 27,
1999 (collectively, the "Line of Credit Agreement"). The Line of Credit is
evidenced by a Revolving Note dated May 27, 1999 from the Borrower to the Lender
in the original principal amount of $15,000,000 (the "Note").

      R-2. The Line of Credit is secured by, among other things, the Line of
Credit Agreement, whereby the Borrower granted to the Lender a security interest
in (i) all Accounts, (ii) all payments or rights to payment due or to become due
under any Government Contract to which the Borrower is a party, (iii) all
deposit accounts and other obligations or indebtedness owed to the Borrower from
whatever source arising, (iv) all rights to receive any payment in money or in
kind, (v) all contract rights (except contract rights under Government Contracts
other than rights to payments due or to become due), (vi) all Inventory, (vii)
all property, plant and Equipment, (viii) all chattel paper, (ix) all General
Intangibles, (x) all books and records and computer hardware, software
(including, to the extent assignable, the Borrower's right to use software
licensed to the Borrower) and systems, (xi) all policies of insurance and the
proceeds thereof, (xii) all additions and accessions thereto and replacements
thereof and (xiii) all products and proceeds thereof, as more particularly
described therein.

      R-3. Pursuant to the Line of Credit Agreement, the Lender also agreed to
issue from time to time, subject to the provisions thereof, letters of credit
(the "Letters of Credit"). No Letters of Credit have been issued under the Line
of Credit Agreement.

      R-4. The Line of Credit Agreement, the Note and all other documents
evidencing, securing, guaranteeing or otherwise related to the Line of Credit
are collectively called the "Loan Documents."

      R-5. As of December 14, 1999, there is due under the Line of Credit
principal of Two Million Three Hundred Thousand and 00/100 Dollars
($2,300,000.00) and interest of Seven
<PAGE>

Thousand Six Hundred Two and 84/100 Dollars ($7,602.84), plus attorneys' fees
and other costs which are payable under the Loan Documents.

      R-6. Capitalized terms used herein and not otherwise defined herein shall
have the meanings set forth in the Line of Credit Agreement.

      R-7. The Lender contends that the Borrower is in default under the Loan
Documents due to, among other things, violations of certain financial covenants
and financial reporting under the Line of Credit Agreement.

      R-8. The Borrower has requested that the Lender continue to make advances
under the Line of Credit and extend the maturity date of the Line of Credit
until November 30, 2000 and the Lender is willing to do so subject to the terms
and conditions set forth in this Agreement.

      NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements set forth herein, the sum of Ten Dollars ($10.00) and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties, the parties hereto covenant and agree as follows.

      1. Recitals. The Recitals set forth above are a material part of this
Agreement. The Borrower acknowledges and affirms the accuracy of the Recitals
set forth above.

      2. Confirmation and Ratification of Documents; Consent to this Agreement.
The Borrower agrees that the Loan Documents are in full force and effect and
that each Loan Document shall remain in full force and effect unless and until
modified or amended in writing in accordance with its terms. The Borrower
ratifies and confirms their respective obligations under the Loan Documents, and
agrees that the execution and delivery of this Agreement shall not in any way
diminish or invalidate any of their respective obligations under the Loan
Documents. All parties consent to the execution and delivery of this Agreement
and to all the provisions of this Agreement to the extent that such provisions
may modify the terms and provisions of any of the Loan Documents.

      3. Service Charge. Commencing March 1,2000 and on the first day of each
month thereafter, the Borrower shall pay monthly to the Lender a monthly service
charge of $1,500.

      4. Principal Curtailments. The Borrower shall pay to the Lender fifty
percent (50%) of the net proceeds remaining after payment in full to Deutsche
Financial Services of certain indebtedness owed by the Borrower to Deutsche
Financial Services and secured by an existing pledge of certain collateral of
IDP and PRIMO of (a) the sale of the business (whether as a stock purchase or a
sale or transfer of the assets) of Puerto Rico Industrial Manufacturing
Operations Acquisition, Corp. ("PRIMO") and (b) any settlement with the U.S. Air
Force in connection with the contract awarded to International Data Products,
Corp. ("IDP") on or about May 1997 for high performance desktop computers (the
"Desktop V contract"), which contract the Borrower has advised was not renewed
by the U.S. Air Force, such proceeds not to exceed


                                      -2-
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$1,000,000 in the aggregate (each, a "Curtailment Event") (i.e., upon the first
Curtailment Event to occur, the Borrower shall pay to the Lender fifty percent
(50%) of the proceeds of such Curtailment Event up to $1,000,000; in the event
that the Lender receives less than $1,000,000 from the proceeds of such
Curtailment Event, the Borrower shall pay to the Lender fifty percent (50%) of
the proceeds of the next Curtailment Event up to an aggregate amount from both
Curtailment Events of $1,000.000).

      5. Permanent Reductions in Line of Credit.

            (a) Upon execution of this Agreement, the availability under the
Line of Credit shall be permanently reduced from $15,000,000 to $5,000,000.

            (b) The availability under the Line of Credit shall be further
permanently reduced by the amount of any principal curtailments received by the
Lender as a result of any Curtailment Event (see paragraph 5 above).

      6. Ineligible Accounts. The Borrower and the Lender agree that (a) the
conditions required to be satisfied before the Accounts of IDP and PRIMO could
be considered Eligible Accounts, as set forth in the letter agreement dated May
27, 1999, have not been satisfied and that therefore (b) all Accounts of IDP and
PRIMO have been since the Lender first made the Line of Credit available to the
Borrower and shall continue to be Ineligible Accounts. Notwithstanding the
foregoing and subject to the first priority security interest of Deutsche
Financial Services, all Accounts of IDP and PRIMO shall nevertheless remain as
collateral for all obligations owed to the Lender.

      7. Deletion of Inventory from Borrowing Base. Effective upon the execution
of this Agreement, the Borrower shall no longer be able to borrow against
Inventory under the Line of Credit. The definition of "Borrowing Base" set forth
in Section 1.1 of the Line of Credit Agreement is deleted and the following is
substituted in lieu thereof: ""Borrowing Base" means at the time in question the
sum of: (a) ninety percent (90%) of the Borrower's Eligible Government Accounts
plus (b) eighty percent (80%) of the Borrower's Eligible Commercial Accounts,
provided that all Accounts of IDP and PRIMO are Ineligible Accounts and shall
not be included in the Borrowing Base. In the absence of manifest error,
Lender's determination of the amount of the Borrowing Base shall be conclusive."
Notwithstanding that the Borrower cannot borrow against Inventory and subject to
the first priority security interest of Deutsche Financial Services in the
Inventory of IDP and PRIMO, Inventory shall nevertheless remain as collateral
for all obligations owed to the Lender.

      8. Borrowing Base Certificates. The Borrower shall furnish the Lender with
borrowing base certificates (in form acceptable to the Lender in its sole
discretion) by 10:00 a.m. (McLean, Virginia time) on the day which is five (5)
business days after the fifteenth (15th) and the thirtieth (30th) day of
each month, respectively, covering the periods from (A) the first (lst) day of
the month through the fifteenth (15th) day of the month and (B) the sixteenth
(16th) day of the month through the thirtieth (30th) day of the month (or the
last day of the month in the event


                                      -3-
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that the month does not have thirty (30) days (i.e. February and months having
thirty-one (31) days), respectively (regardless of whether any advance is
requested). Such borrowing base certificates should be sent to (a) First Union
National Bank, 1970 Chain Bridge Road, McLean, Virginia 22102. Attn: David A.
Dix, Vice President and (b) First Union National Bank, 1970 Chain Bridge Road,
McLean, Virginia 22102, Attn: Nick Edivan, Telecopy (703) 760-5450.

      9. Interest Rate. Commencing on the date of the execution of this
Agreement, the unpaid principal balance (both the existing unpaid principal
balance and future advances) of the Line of Credit shall bear interest at the
Lender's prime rate plus one percent (1%). Upon the occurrence of an Event of
Default, interest shall accrue and be payable at the applicable interest rate
plus two percent (2%). The Borrower shall no longer have the option to elect the
Reference Rate-Based Option or the LIBOR-Based Rate Option.

      10. Maturity Date. The Line of Credit shall expire on November 30, 2000
(the "Maturity Date") and all principal, interest and other sums then
outstanding shall be immediately due and payable. The Borrower acknowledges that
the Lender has advised the Borrower that the Maturity Date will not be further
extended.

      11. Modification of Note. Contemporaneously with the execution of this
Agreement, the Borrower shall execute a modification of the Note reflecting the
modified interest rate and the modified Maturity Date as set forth in paragraphs
9 and 10 above, respectively, substantially in the form attached hereto as
Exhibit A.

      12. Letters of Credit. Effective upon the execution of this Agreement, no
Letters of Credit shall be issued under the Line of Credit. Section 2.1 E. of
the Line of Credit Agreement which relates to the Letter of Credit Subfacility
is deleted in its entirety.

      13. Costs and Expenses. Upon execution of this Agreement, the Borrower
shall pay to the Lender by certified or cashier's check all actual costs and
expenses, including, without limitation, attorneys' fees, UCC search costs and
costs related to the field audit incurred by the Lender in connection with the
Line of Credit.

      14. Lockbox/Restricted Account.

            (a) With the consent of the Borrower, the Lender has established or
will establish contemporaneously with the execution of this Agreement (a) a post
office box(es) or other collection facility(ies) under the Lender's control
(collectively, the "Lockbox"). Contemporaneously with the execution of this
Agreement, the Borrower will direct by written notice in form and substance
satisfactory to the Lender in its sole discretion, all account debtors of the
Borrower (excluding IDP and PRIMO) to send all Payments either by check to the
Lockbox for deposit upon collection into the Restricted Account (as defined
below) or by electronic funds transfer directly to the Restricted Account (as
defined below). Restricted Account shall mean collectively those accounts
identified on Exhibit B attached hereto plus any other accounts established by
the Lender at the Borrower's direction for the purpose of receiving


                                      -4-
<PAGE>

Payments. All accounts which constitute the Restricted Account shall be titled
as follows: "First Union National Bank Restricted Account for Dunn Computer
Operating Company." The Restricted Account shall be under the sole and absolute
control of the Lender and the Lender shall have the sole power of withdrawal
from the Restricted Account. The Borrower shall not be entitled to make any
withdrawals or disbursements from or otherwise pay any expenses out of the
Restricted Account, nor shall the Borrower be deemed to have any rights thereto,
or interest therein, except as expressly set forth herein. Within ten (10) days
after all obligations of the Borrower under the Line of Credit Agreement and the
other Loan Documents have been paid in full and performed, the Lender shall pay
the funds remaining, if any, in the Restricted Account to the Borrower.

            (b) If any Payments are made directly to the Borrower or otherwise
come into The Borrower's possession, the Borrow shall not commingle any such
Payment with The Borrower's other funds or property, but shall hold the Payment
separate and apart in trust for the Lender and shall promptly deliver the
Payment to the Lender (appropriately endorsed, if the Payment is in the form of
a check) for deposit into the Restricted Account. Interest (if any) earned on
sums on deposit in the Restricted Account shall be added to the Restricted
Account. The Borrower hereby appoints the Lender and any officer, employee or
agent of the Lender as the Lender may from time to time designate as
attorneys-in-fact for the Borrower to endorse and sign the name of the Borrower
on all checks, drafts, money orders or other Items delivered to the Lender for
deposit into the Restricted Account. The Restricted Account shall constitute
part of the Collateral, and funds on deposit in the Restricted Account shall be
disbursed to the Borrower only by a disbursement to the Operating Account as
provided hereafter in this Agreement.

            (c) If no Event of Default has occurred and remains uncured, and
there exists no event, occurrence or circumstance that, with the giving of
notice or the passage of time or both, would constitute an Event of Default,
funds on deposit in the Restricted Account shall be withdrawn by the Lender on
the Business Day next following the day on which such funds are deposited, and
shall be applied as follows: (1) first, to unpaid late charges under the
Revolving Note; (2) second, to reimburse any amounts advanced by the Lender to
cure defaults under this Agreement; (3) third, to any unpaid fees due and
payable under the Agreement; (4) fourth, to accrued interest due and payable
under the Note; (5) fifth, to unpaid principal indebtedness under the Revolving
Note; and (6) sixth, the balance, if any, to the Borrower's Operating Account.
Borrower retains sole responsibility for assuring that the Borrower's Operating
Account contains sufficient funds to pay any Items that may be presented for
payment from the Operating Account.

            (d) Notwithstanding anything to the contrary contained herein, in
the event that any Item delivered to the Lender for deposit into the Lockbox is
returned unpaid to the Lender, or is dishonored by the Lender, the Lender will
debit the Restricted Account for the entire amount credited thereto in respect
of such Item, together with any applicable service charge. In the event that the
funds on deposit in the Restricted Account are insufficient to pay such returned
or dishonored Items, the amount of such deficiency shall be deemed an Advance
under the Line of Credit which the Borrower shall pay to the Lender immediately
upon demand.


                                      -5-
<PAGE>

            (e) Within ten (10) days after the execution of this Agreement, the
Borrower shall execute all supplemental documentation that the Lender may
request, in form and substance acceptable to the Lender, to put in place a cash
management system for the transactions contemplated by this paragraph 14. In the
event the Borrower fails to execute and deliver to the Lender any such
supplemental documentation within three (3) days of a request therefor, the
Borrower hereby appoints the Lender and any officer, employee or agent of the
Lender as the Lender may from time to time designate as attorneys-in-fact for
the Borrower to sign the name of the Borrower on any such supplemental
documentation.

      15. Assignment of Government Contracts.

            (a) A list of all existing Government Contracts of the Borrower are
attached hereto as Exhibit C and the Borrower represents and warrants to the
Lender that such list is an accurate and complete list of all existing
Government Contracts of the Borrower.

            (b) Within fifteen (15) days after the execution of this Agreement,
the Borrower shall execute assignments of moneys due and to become due under
Government Contracts (each, an "Assignment") in form acceptable to the Lender,
assigning (under the Assignment of Claims Act, 31 USC Section 3727 and 41 USC
Section 15) to the Lender all moneys due and to become due from the United
States of America together with all rights to receive the same, under each
existing government contract of the Borrower.

            (c) The Borrower will obtain the written acknowledgement of each
government contracting officer (and any other necessary party) to each
Assignment within four (4) weeks after the execution of this Agreement.

            (d) In the event that the Borrower enters into any Government
Contracts after closing, the Borrower shall (i) notify the Lender in writing of
such contact, and provide the Lender with a copy of such contract, immediately
upon execution thereof, (ii) execute an Assignment for each such contract within
five (5) days after a request therefor from the Lender and (iii) obtain the
written acknowledgment of the contracting officer (and any other necessary
party) to each such Assignment within four (4) weeks after the execution
thereof.

            (e) The separate Assignments to the Lender of a right to payment
under specific Government Contracts as contemplated under this paragraph shall
not be deemed to limit the Lender's security interest to Payments under those
particular Government Contracts and the related Government Accounts, but rather
the Lender's security interest shall extend to Payments under any and all
Government Contracts and the related Government Accounts and proceeds thereof,
now or hereafter owned or acquired by the Borrower.

            (f) The Borrower acknowledges that the Lender will be irrevocably
harmed if the Borrower fails to assign Payments due or to become due under any
Government Contract when required and that the Lender shall have no adequate
remedy at law. Therefore, the Borrower agrees that the Lender shall be entitled,
in addition to all other remedies allowed by


                                      -6-
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law or under the Agreement, the Line of Credit Agreement or the other Loan
Documents, to injunctive or other equitable relief to compel the Borrower's
compliance with the provisions of this Agreement and the Line of Credit
Agreement requiring the Borrower to assign Payments due or to become due under
any Government Contract.

            (g) Notwithstanding the foregoing, the Lender agrees that the
Borrower shall only be required to assign to the Lender any Government Contracts
which (i) are with the government of the United States or the departments or
agencies of the United States and (ii) cannot be fully performed within six (6)
months of the date of execution of such Government Contract.

      16. Financial Covenants. The financial covenants set forth in Section 6.14
of the Line of Credit Agreement are deleted and replaced with the following:

            (a) The Borrower shall maintain a minimum liquidity ratio (i.e.,
current assets over total liabilities, to be measured quarterly) of (i) .60 from
January 31, 2000 through April 30, 2000 and (ii) .75 from May 1, 2000 and
thereafter.

            (b) The Borrower shall maintain a ratio of EBIT/Interest (i.e.
earnings before interest and taxes over interest to be measured quarterly) of
not less than 1.0 at all times from the execution of this Agreement and
thereafter.

            (c) The Borrower shall maintain a ratio of total liabilities to
tangible net worth (i.e. total stockholder equity less goodwill and other
intangible assets, to be measured quarterly) of not more than 13.5 to 1.0 at all
times from the execution of this Agreement and thereafter.

            Unless otherwise defined, all accounting terms shall have the
definitions given them in accordance with generally accepted accounting
principles; all accounting terms and covenants shall be applied on a
consolidated basis.

      17. Negative Covenants. In addition to the negative covenants set forth in
Article 7 of the Line of Credit Agreement, the Borrower covenants and agrees
that, until all obligations of the Borrower under the Line of Credit Agreement
and the other Loan Documents are paid in full and performed, (a) it shall not
make any payments to Deutsche Financial Services in connection with the
indebtedness owed by the Borrower except as provided in the agreement between
Deutsche Financial Services and the Borrower which is attached hereto as Exhibit
E and (b) it shall not incur any capital expenditures, except that the Borrower
shall be permitted to make capital expenditures provided that the cost of such
capital expenditures do not exceed in the aggregate on an annualized basis
$1,000,000 so long as the Line of Credit is outstanding.

      18. Financial Statements and Information.

            (a) The Borrower shall provide the Lender with an aging and listing
of accounts receivable (including both Commercial Accounts and Government
Accounts) and an


                                      -7-
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aging and listing of accounts payable by 10:00 a.m. on the day which is five (5)
business days after the fifteenth (15th) and the thirtieth (30th) day of each
month, respectively, covering the periods from (A) the first (lst) day of the
month through the fifteenth (15th) day of the month and (B) the sixteenth (16th)
day of the month through the thirtieth (30th) day of the month (or the last day
of the month in the event that the month does not have thirty (30) days (i.e.,
February and months having thirty-one (31) days), respectively. Such list shall
identify which accounts receivable have been pledged to which creditor.

            (b) The Borrower shall provide the Lender on a monthly basis
consolidating financial statements in such form and detail as the Lender may
require.

            (c) Within ninety (90) days from the end of each fiscal year, the
Borrower shall provide to the Lender the complete 10-K and consolidating balance
sheets and income and expense statements of the Borrower together with its
subsidiaries audited by an independent certified public accountant firm selected
by the Borrower and acceptable to the Lender. Within forty-five (45) days from
the end of each fiscal quarter, the Borrower shall provide to the Lender the
complete 10-Q and consolidating balance sheets and income and expense statements
of the Borrower together with its subsidiaries, in reasonable detail and
prepared in accordance with GAAP. Notwithstanding the foregoing, in the event
that the Borrower shall file for and receive an extension of time to file its
10-K or l0-Q, the time periods referenced in this paragraph shall be extended by
thirty (30) days, as applicable.

            (d) The Borrower shall provide to the Lender such other financial or
other information as the Lender may request in its reasonable discretion from
time to time.

      19. Landlord's Waivers. The Borrower shall use their best efforts to
deliver to the Lender, contemporaneously with the execution of this Agreement,
agreements which must be in form and substance satisfactory to the Lender in its
sole discretion, relating to the Borrower's facilities in Sterling, Virginia and
Guayama, Puerto Rico, waiving any landlord's or mortgagee's or lienholder's
rights to enforce any claim against the Borrower against any collateral of the
Lender and allowing the Lender to have access to its collateral for purposes of
inspection and/or to take possession thereof in accordance with the Lender's
rights under the Loan Documents and applicable law. In connection therewith, and
contemporaneously with the execution of this Agreement, the Borrowers shall
provide to the Lender copies of all leases, mortgages or similar agreements
relating to any facility that is not owned by the Borrowers at which any
collateral is located.

      20. Audits of Collateral After Closing. The Borrower shall permit the
Lender or any agent or representative thereof, at any reasonable time and from
time to time, to conduct a field audit of the inventory and a records audit of
the accounts receivable and other collateral. The Borrower shall be responsible
for all costs and expenses associated with two (2) such audits conducted after
January 31, 2000 (which shall be deemed to be obligations which are secured by
the Loan Documents, as amended by this Agreement and the documents executed in
connection with this Agreement). Notwithstanding the foregoing, the Lender
agrees that, provided that no


                                      -8-
<PAGE>

Event of Default has occurred, and there exists no event, occurrence or
circumstance that, with the giving of notice or the passage of time or both,
would constitute an Event of Default, the Borrower shall only be responsible for
a maximum of $5,000 of the costs and expenses associated with any such audit(s)
(i.e., the Borrower shall only be responsible for a maximum of $5,000, whether
the Lender elects to conduct one (1) or two (2) audits and whether the costs and
expenses of such audit or audits exceed $5,000 individually or in the
aggregate).

      21. Refinancing. The Borrower shall use their best efforts to secure
refinancing or seek debt and/or equity in amounts sufficient to satisfy in full
the Line of Credit on or prior to the Maturity Date. Commencing on April 1, 2000
and on the first day of each month thereafter until the Line of Credit has been
paid in full, the Borrower shall provide to the Lender a written status report
detailing these efforts.

      22. Resolutions of the Borrower/Good Standing. Contemporaneously with the
execution of this Agreement, the Borrower shall deliver to the Lender
resolutions prepared by the Borrower evidencing their consent to the execution
of this Agreement and the documents executed in connection with this Agreement.
Contemporaneously with the execution of this Agreement, the Borrower shall also
obtain and deliver to the Lender current good standing certificates for all of
the jurisdictions in which the Borrower is incorporated or doing business.

      23. Representations and Warranties. In order to induce the Lender to enter
into this Agreement, the Borrower represents and warrants to the Lender as
follows:

            (a) Organization and Standing. Each Borrower is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, with corporate power adequate to own and
operate the properties owned by it, to carry on the business conducted by it, to
enter into and perform this Agreement and to carry out the transactions
contemplated hereby.

            (b) Authorization and Validity. The execution and delivery of this
Agreement by the Borrower and the performance of the Borrower's obligations
hereunder have been duly authorized by proper corporate action and this
Agreement constitutes the legal, valid and binding obligations of the Borrower
and is enforceable in accordance with its terms.

            (c) Compliance with Other Instruments. The Borrower is not in
violation of any provision of their articles of incorporation or by-laws and are
not in default under any existing judgement (except as set forth on Exhibit F
attached hereto) or decree or of any existing law, governmental order, rule or
regulation applicable to it, or of any agreement or other instrument to which it
is a party or by which it or its assets are bound to the extent that any such
violation would affect the ability of the Borrower to perform any of their
obligations under this Agreement, any documents executed in connection with this
Agreement or the Loan Documents in any material respect. Neither the execution
and delivery of this Agreement nor the consummation of the transactions herein
contemplated, nor compliance with the terms and provisions hereof, has
constituted or resulted in or will constitute or result in a breach of the


                                      -9-
<PAGE>

articles of incorporation or by-laws of any Borrower, or the violation of any
presently existing applicable governmental requirement or will conflict or will
be inconsistent with or will result in any breach of any of the terms,
covenants, conditions or provisions thereof, or will constitute a default under,
any indenture, mortgage, deed of trust, instrument, document, agreement or
contract of any kind to which any Borrower is a party or by which any Borrower
may be bound or subject to the extent that any such breach or default would
affect the ability of any of Borrower to perform any of their obligations under
this Agreement, any documents executed in connection with this Agreement or the
Loan Documents in any material respect.

            (d) Litigation. Except as set forth on Exhibit F attached hereto,
there are no actions, suits or proceedings at law or in equity or by or before
any governmental instrumentality or other agency now pending or, to the
knowledge of any Borrower, threatened against or affecting any Borrower or any
property or rights of any Borrower which reasonably may be expected to have a
material adverse effect on the property, business, operations, financial
condition, prospects, liabilities or capitalization of any Borrower. Except as
set forth in this paragraph 23(d), no Borrower is in default with respect to any
judgment, order, writ, injunction, decree, demand, rule or regulations of any
court, arbitrator, grand jury or of any governmental agency.

            (e) Assets. The Borrower's assets are not subject to any existing
liens or encumbrances except that granted to the Lender except as shown on
Exhibit G attached hereto. The Borrower maintains in full force and effect the
insurance required under Section 6.6 of the Loan Agreement. The Borrower's
Equipment is kept at the locations set forth on Exhibit H attached hereto. The
Borrower maintains its chief executive office at the place identified on Exhibit
I attached hereto and keeps its books and records at that office.

            (f) Taxes. The Borrower has filed and will continue to file all
United States income tax returns and all state income tax returns that are
required to be filed, and has paid, or made adequate provisions for the payment
of all taxes which have or may become due pursuant to said returns or pursuant
to any assessment received by any Borrower.

            (g) Licenses and Contracts. All franchises, licenses, trademarks,
trade names, copyrights, patents, permits, certificates, consents, approvals,
authorizations, agreements and contracts necessary to operate the Borrower's
business as it currently is being operated and to own or lease the Borrower's
property have been obtained, are in effect, have been complied with in material
respects by the Borrower, are free from challenge, and are fully assignable to
the Lender for the purpose of securing the Revolving Loan. Borrower has no
knowledge and has not received any notice to the effect that any product it
manufactures or sells, or any service it renders, or any process, method,
know-how, trade secret, part or material it employs in the manufacture of any
product it makes or sells or any service it renders, or the marketing or use by
it or another of any such product or service, may infringe any trademark, trade
name, copyright, patent, trade secret or legally protected right of any other
Person.


                                      -10-
<PAGE>

            (h) Intellectual Property. The Borrower owns all right, title and
interest in and to all Intellectual Property used in and material to the
operation of its business or, for such Intellectual Property that is not owned,
possesses adequate licenses or other legally enforceable rights to use the same.
The Borrower has no reason to believe that any valid basis exists upon which a
claim adversely affecting any such Intellectual Property may be asserted against
the Borrower or any subsidiary. To the best knowledge of the Borrower, no Person
is infringing upon the Intellectual Property used by the Borrower or any
subsidiary material to the operation of their respective businesses. The
Borrower has taken appropriate steps to protect the secrecy, confidentiality and
value of its and all subsidiaries' rights in and to such Intellectual Property
and to prevent others from using such Intellectual Property without consent.

            (i) Trade Name; Merger. Except as set forth in Exhibit J attached
hereto, during the five years immediately preceding the date of this Agreement:
(i) neither the Borrower nor any predecessor of the Borrower has used any
corporate or fictitious name other than its current corporate name; (ii) the
Borrower has not changed its name, or been the surviving entity in a merger or
acquired any business; and (iii) the Borrower has utilized no trade names in the
conduct of its business.

            (j) Payment of Employees and Subcontractors. The Borrower is not in
default with regard to the payment of any employee or subcontractor.

            (k) ERISA. The Borrower is in compliance with the Borrower's
obligations under ERISA.

            (l) Government Contracts. The Borrower is not currently in default
as to the terms of any Government Contract, and no Government Contract has been
canceled or terminated by the Government in the past ten years except as set
forth in Exhibit K attached hereto. No Government Contract for which Payments
have been assigned to the Lender as Collateral is dependent on appropriations,
except as set forth in Exhibit L attached hereto.

            (m) Assignment of Payments. The Borrower has the right to assign to
the Lender all Payments due or to become due under each of the Borrower's
Government Contracts, and there exists no uncancelled prior Assignment of
Payments under any of the Borrower's Government Contracts.

            (n) Assignment of Claims Act. The Borrower is now in compliance and
hereby covenants and agrees that the Borrower will in the future comply with any
and all of the requirements of the Assignments of Claims Act, where such
statutes are applicable to any Government Contract, and shall take all such
other action as may be necessary to facilitate the assignment and perfection of
the Lender's interest in Payments under any Government Contract.

            (o) No Claims, etc. There are no claims, defenses or setoffs with
respect to the Note or with respect to any of the other Loan Documents, or with
respect to the indebtedness evidenced or secured thereby or with respect to the
collection or enforcement of any of the same


                                      -11-
<PAGE>

(and to the extent any such claim, setoff or defense exists, they are each
waived and relinquished in their entirety).

            (p) Disclosure. This Agreement and all agreements, documents,
certificates or statements furnished to the Lender by or on behalf of the
Borrower in connection with the transactions contemplated hereby are true,
correct and complete and do not contain any untrue statement of material fact.

            (q) Benefit. Each Borrower has derived direct or indirect benefit
from this Agreement and the transactions contemplated hereby.

            (r) Free Act and Will. The Borrower is not entering into this
Agreement in reliance upon any statement, representation or warranty of any
nature whatsoever made by the Lender, or any other person or entity whatsoever,
which is not expressly stated herein, and each Borrower has entered into this
Agreement entirely of its own free act and will.

      24. Events of Default. The occurrence of one or more of any of the
following events (the "Events of Default") shall constitute an Event of Default
under this Agreement:

            (a) Failure to pay to the Lender when due any amounts required by
this Agreement or any document executed in connection with this Agreement within
five (5) Business Days after written notice from the Lender, provided that the
foregoing shall not be construed to grant to the Borrower an additional five (5)
day cure period beyond the five (5) day cure period presently set forth in the
Loan Documents to pay any sum payable under the Note (i.e., the Borrower has an
aggregate of five (5) days after written notice from the Lender to pay any sum
payable under the Note).

            (b) Failure to comply with or perform as and when required, or to
observe, any of the other terms, conditions or covenants of this Agreement or
any document executed in connection with this Agreement within five (5) Business
Days after written notice from the Lender.

            (c) If any representation or warranty made herein, in any document
executed in connection with this Agreement or in any report, certificate,
financial statement or other instrument furnished in connection with this
Agreement, shall prove to have been materially false or misleading on the date
as of which it was made.

            (d) If the Lender determines in good faith that a material adverse
change has occurred in the financial condition or business condition of the
Borrower.

            (e) If a monetary default(s) in excess of $100,000 in the aggregate
which remains uncured after the expiration of any applicable cure period occurs
under any indebtedness or other obligation of the Borrower to any third party
unless such default(s) constitute(s) a bona fide dispute which the Borrower is
contesting in good faith.


                                      -12-
<PAGE>

            (f) If a default which remains uncured after the expiration of any
applicable curt period or an Event of Default occurs under any of the Loan
Documents.

            (g) The failure of the Borrower, within forty-five (45) days after
the execution of this Agreement, to enter into an agreement (the "Forbearance
Agreement") with John Signorello, a judgment creditor (the "Judgment Creditor")
of Dunn Computer Corporation pursuant to a judgement entered in the Circuit
Court of Fairfax County, Virginia (At Law Number 185647) (the "Judgement"),
which Forbearance Agreement must provide that the Judgment Creditor will forbear
from exercising his rights and remedies under the Judgment until all obligations
of the Borrower under the Line of Credit Agreement and the other Loan Documents
have been paid in full and performed except in the event the Borrower fails to
pay the Judgment pursuant to the terms of the Forbearance Agreement.

            (h) A default occurs under the Forbearance Agreement (see paragraph
24(g) above).

            (i) The use of the proceeds of the Line of Credit (directly or
indirectly) to satisfy the Judgment (see paragraph 24(g) above) (The Borrower
has represented to the Lender that a Borrower or a principal of a Borrower will
satisfy the Judgment (if not dismissed) through a contribution of new equity)

            (j) The failure of the Borrower, within fourteen (14) days after the
execution of this Agreement, to deliver to the Lender Exhibits C, E, F, G, H and
I referenced herein.

            (k) The failure of the Borrower, within thirty (30) days after the
execution of this Agreement, to deliver to the Lender Exhibits J, K and L
referenced herein.

            Notwithstanding that the Borrower is entitled to certain written
notice and an opportunity to cure as set forth in paragraphs 24(a), (b) and (f)
(by reference to the Loan Documents) above, the Lender's obligation to make
Advances to the Borrower shall cease immediately upon the occurrence of any
event, occurrence or circumstance that, with the giving of notice or the passage
of time or both, would constitute an Event of Default (i.e., the Lender's
obligation to make Advances to the Borrower shall cease immediately upon the
occurrence of a default hereunder or under the Loan Documents, even though an
Event of Default may not have occurred because the Borrower is entitled to such
notice and opportunity to cure). At such time as such default is cured by the
Borrower within the applicable cure period to the satisfaction of the Lender,
and provided that no new default or Event of Default has occurred and is
continuing, the Lender shall be obligated to make Advances pursuant to the terms
of the Loan Agreement and subject to the conditions set forth therein.

      25. Remedies. Immediately upon the occurrence of any Event of Default, the
Lender shall have the right to exercise any and all rights available to it under
this Agreement, any document executed in connection with this Agreement or any
of the Loan Documents and


                                      -13-
<PAGE>

applicable law. All rights and remedies available to the Lender under this
Agreement, any document executed in connection with this Agreement or any of the
Loan Documents and applicable law may be asserted concurrently, cumulatively or
successively, from time to time, as long as the parties hereto shall be indebted
to the Lender.

      26. Primary Depository Account. The Borrower shall maintain their primary
depository accounts with the Lender.

      27. Release. Each Borrower, for itself and its directors, officers,
employees, agents, members, predecessors, successors and assigns, hereby
releases and forever waives and relinquishes all claims, demands, obligations,
liabilities and causes of action of whatsoever kind or nature, whether known or
unknown, which it or he has, may have or might have or assert now or in the
future as a result of events occurring prior to or contemporaneously with the
execution of this Agreement against the Lender (which term for the purpose of
this paragraph 27 shall mean both First Union National Bank and First Union
Commercial Corporation) and/or any affiliates or entities related to such
entity, and any of the directors, officers, employees, agents, successors and
assigns, as the case may be, of all such entities, in connection with, directly
or indirectly, this Agreement, the Loan Documents, any document executed in
connection with this Agreement or any transactions contemplated hereby or
thereby, any prior loan made or credit extended to the Borrower by the Lender or
otherwise to any relationship between any Borrower and the Lender.
Notwithstanding the foregoing, the Borrower does not release First Union
National Bank from any claims, if any, the Borrower may have against First Union
National Bank in connection with the handling of check nos. 009786, 009787 and
009788 made by the Borrower to various payees in the aggregate amount of
approximately $58,000, provided that the Borrower shall not have the right to
claim any consequential or incidental damages.

      28. Further Assurances and Corrective Instruments. The Borrower will
execute, acknowledge and deliver, from time to time, such supplements hereto and
such further instruments and documents, as the Lender may require in its
reasonable discretion to protect, perfect and enforce the Lender's interest in
any collateral security for the Line of Credit or to facilitate the carrying out
of the intentions of the parties to this Agreement.

      29. Waiver of Trial by Jury. Each Borrower and the Lender hereby waive
trial by jury in any action or proceeding to which any Borrower and the Lender
may be parties, arising out of or in any way pertaining to this Agreement, any
of the documents executed in connection with this Agreement or the Loan
Documents. It is agreed and understood that this waiver constitutes a waiver of
trial by jury of all claims against all parties to such actions or proceedings,
including claims against parties who are not parties to this Agreement. This
waiver is knowingly, willingly and voluntarily made by each Borrower and each
Borrower hereby represents that no representations of fact or opinion have been
made by any individual to induce this waiver of trial by jury or to in any way
modify or nullify its effect. Each Borrower further represents that it has been
represented or has had the opportunity to be represented in the signing of this
Agreement and in the making of


                                      -14-
<PAGE>

this waiver by independent legal counsel, selected of its own free will, and
that it has had the opportunity to discuss this waiver with counsel.

      30. Consent to Assignment of Line of Credit and Disclosure of Documents.
Each Borrower consents to the sale and assignment by the Lender of any or all of
their interest in the Line of Credit at any time in the Lender's sole and
absolute discretion. Within fifteen (15) days after any such sale or assignment,
the Lender shall provide the Borrower with notice of the name of the individual
or entity purchasing such Line of Credit. In conjunction with such assignment,
Each Borrower consents to the disclosure of any and all books, records, files,
loan agreements, notes, deeds of trust, guaranties, financing statements,
assignments of leases, statements, ledger cards, signature cards, corporate
and/or partnership documents, financial statements, leases, appraisals,
environmental audits, hazard and liability insurance policies, title insurance
policies, loan payment histories, income tax returns, credit analyses, notes,
correspondence, internal memoranda, checks, deposit account records and other
documents which are in the Lender's possession or control or to which the Lender
is entitled under the terms of this Agreement, any documents executed in
connection with this Agreement or the Loan Documents relating to the Line of
Credit to prospective assignees in connection with any sale or contemplated sale
of the Line of Credit or any participation interest therein.

      31. Arbitration. Section 10.19 of the Line of Credit Agreement relating to
arbitration is deleted in its entirety. All other references to arbitration in
the Line of Credit Agreement are also deleted in their entirety. A confession of
judgment provision shall be included in the modification of the Note (see
paragraph 11 above).

      32. Miscellaneous.

            (a) Waivers by the Lender. Neither any failure nor any delay on the
part of the Lender in exercising any right, power or remedy under this
Agreement, any documents executed in connection with this Agreement or the Loan
Documents, or under applicable law shall operate as a waiver thereof, nor shall
a single or partial exercise thereof preclude any other or further exercises
thereof or the exercise of any other right, power or remedy. No waiver or
forbearance by the Leader as to any Borrower shall waive or release any rights
or claims which the Lender may now have or hereafter have against any other
person, firm or individual. The Lender reserves all rights except to the extent
expressly provided herein.

            (b) Modifications. No modification or waiver of any provision of
this Agreement, any documents executed in connection with this Agreement or the
Loan Documents, and no consent by the Lender to any departure by the Borrower
therefrom shall in any event be effective unless the modification, waiver or
consent shall be in writing. Any such waiver or consent shall be effective only
in the specific instance or for the purpose for which given. No notice to, or
demand upon the Borrower in any case shall entitle the Borrower to any other or
further notice or demand in the same, similar or other circumstances.


                                      -15-
<PAGE>

            (c) No Novation. Nothing set forth in this Agreement or in any of
the documents executed in connection with this Agreement shall cause a novation
nor shall it extinguish, terminate, or impair the Borrower's obligations under
the Loan Documents, as amended by this Agreement, or affect the priority of the
lien of the Lender established by the Loan Documents.

            (d) Applicable Law. The performance, construction and enforcement of
this Agreement, the documents executed in connection with this Agreement and the
Loan Documents shall be governed by the Laws of the Commonwealth of Virginia.

            (e) Survival; Successors and Assigns. All covenants, agreements,
representations and warranties made herein, in any documents executed in
connection with this Agreement and in the Loan Documents shall continue in full
force and effect. Whenever in this Agreement any of the parties is referred to,
such reference shall be deemed to include the successors and assigns of such
party. All covenants, agreements, representations and warranties by or on behalf
of the Borrower which are contained in this Agreement, in any documents executed
in connection with this Agreement and the Loan Documents shall inure to the
benefit of the Lender and its successors and assigns.

            (f) Severability. If any term, provision or condition, or any part
thereof, of this Agreement, any documents executed in connection with this
Agreement or the Loan Documents shall for any reason be found or held to be
invalid or unenforceable by any court or governmental agency of competent
jurisdiction, such invalidity or enforceability shall not affect the remainder
of such term, provision or condition or any other term, provision or condition,
and this Agreement, any documents executed in connection with this Agreement and
the Loan Documents shall survive and be construed as if such invalid or
unenforceable term, provision or condition had not been contained therein.

            (g) Merger and Integration. This Agreement, any documents executed
in connection with this Agreement and the Loan Documents contain the entire
agreement of the parties hereto with respect to the matters covered and the
transactions contemplated hereby, and no other agreement, statement or promise
made by any party hereto, or any employee, officer, agent or attorney of any
party hereto, shall be valid or binding.

            (h) Headings. The headings and subheadings contained in the titling
of this Agreement are intended to be used for convenience only and shall not be
used or deemed to limit or diminish any of the provisions hereof.

            (i) Gender, Singular. All references made (a) in the neuter,
masculine or feminine gender shall be deemed to have been made in all such
genders, and (b) in the singular or plural member shall be deemed to have been
made, respectively, in the plural or singular number as well.

            (j) Time of Essence. Time is of the essence of this Agreement.


                                      -16-
<PAGE>

          Exhibit D     [Intentionally Deleted]
          Exhibit E     Agreement between Deutsche Financial Services and the
                        Borrower
          Exhibit F     Litigation/Judgements
          Exhibit G     Existing Liens and Encumbrances Against Assets
          Exhibit H     Location of Equipment
          Exhibit I     Chief Executive Office of the Borrower
          Exhibit J     Other Trade Names/Mergers
          Exhibit K     Government Contracts Canceled or Terminated in Past Ten
                        Years
          Exhibit L     Government Contracts Dependent on Appropriations

      IN WITNESS WHEREOF, the parties hereto have executed or caused to be
executed, this Agreement under seal as of the date first written above.

WITNESS/ATTEST                    BORROWERS:

                                  DUNN COMPUTER CORPORATION,
                                  a Virginia corporation

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  DUNN COMPUTER CORPORATION,
                                  a Delaware corporation

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  INTERNATIONAL DATA PRODUCTS,
                                  CORP.

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                      -18-
<PAGE>

                                  STMS, INC.

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  PUERTO RICO INDUSTRIAL
                                  MANUFACTURING OPERATIONS
                                  ACQUISITION, CORP.

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  DUNN COMPUTER OPERATING
                                  COMPANY

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  LENDER:

                                  FIRST UNION NATIONAL BANK

/s/ [ILLEGIBLE]                   By: /s/ David A. Dix (SEAL)
------------------                    --------------------------
                                      David A. Dix
                                      Vice President


                                      -19-
<PAGE>

STATE OF Virginia           )
                                  )SS: ###-##-####
CITY/COUNTY of Loudoun      )

      I HEREBY CERTIFY that on this 11th day of February, 2000, before me,
the undersigned officer, personally appeared Thomas P. Dunne, who acknowledged
himself/herself to be the President of Dunn Computer Corporation, a Virginia
corporation, and that (s)he, in such capacity, being authorized to do so,
executed the foregoing instrument for the purposes therein contained, by signing
the name of Dunn Computer Corporation, as President of Dunn Computer
Corporation.

      IN WITNESS WHEREOF, I hereunto set my hand and Notarial Seal.


                                                   /s/ Linda Kiechlin
                                                   ------------------
                                                      Notary Public

My Commission expires: 4/30/2003

STATE OF Virginia           )
                                  )SS: ###-##-####
CITY/COUNTY of Loudoun      )

      I HEREBY CERTIFY that on this 11th day of February, 2000, before me,
the undersigned officer, personally appeared Thomas P. Dunne, who acknowledged
himself/herself to be the President of Dunn Computer Corporation, a Maryland
corporation, and that (s)he, in such capacity, being authorized to do so,
executed the foregoing instrument for the purposes therein contained, by signing
the name of Dunn Computer Corporation, as President of Dunn Computer
Corporation.

      IN WITNESS WHEREOF, I hereunto set my hand and Notarial Seal.


                                                   /s/ Linda Kiechlin
                                                   ------------------
                                                      Notary Public

My Commission expires: 4/30/2003


                                      -20-
<PAGE>

STATE OF Virginia           )
                                  )SS: ###-##-####
CITY/COUNTY of Loudoun      )

      I HEREBY CERTIFY that on this 11th day of February, 2000, before me,
the undersigned officer, personally appeared Thomas P. Dunne, who acknowledged
himself/herself to be the President of International Data Products, Corp., and
that (s)he, in such capacity, being authorized to do so, executed the foregoing
instrument for the purposes therein contained, by signing the name of
International Data Products, Corp., as President of International Data Products,
Corp.

      IN WITNESS WHEREOF, I hereunto set my hand and Notarial Seal.


                                                   /s/ Linda Kiechlin
                                                   ------------------
                                                      Notary Public

My Commission expires: 4/30/2003

STATE OF Virginia           )
                                  )SS: ###-##-####
CITY/COUNTY of Loudoun      )

      I HEREBY CERTIFY that on this 11th day of February, 2000, before me,
the undersigned officer, personally appeared Thomas P. Dunne, who acknowledged
himself/herself to be the President of STMS, Inc., and that (s)he, in such
capacity, being authorized to do so, executed the foregoing instrument for the
purposes therein contained, by signing the name of STMS, Inc., as President of
STMS, Inc.

      IN WITNESS WHEREOF, I hereunto set my hand and Notarial Seal.


                                                   /s/ Linda Kiechlin
                                                   ------------------
                                                      Notary Public

My Commission expires: 4/30/2003


                                      -21-
<PAGE>

STATE OF Virginia           )
                                  )SS: ###-##-####
CITY/COUNTY of Loudoun      )

      I HEREBY CERTIFY that on this 11th day of February, 2000, before me,
the undersigned officer, personally appeared Thomas P. Dunne, who acknowledged
himself/herself to be the President of Puerto Rico Industrial Manufacturing
Operations Acquisition, Corp., and that (s)he, in such capacity, being
authorized to do so, executed the foregoing instrument for the purposes therein
contained, by signing the name of Puerto Rico Industrial Manufacturing
Operations Acquisition, Corp., as President of Puerto Rico Industrial
Manufacturing Operations Acquisition, Corp.

      IN WITNESS WHEREOF, I hereunto set my hand and Notarial Seal.


                                                   /s/ Linda Kiechlin
                                                   ------------------
                                                      Notary Public

My Commission expires: 4/30/2003

STATE OF Virginia           )
                                  )SS: ###-##-####
CITY/COUNTY of Loudoun      )

      I HEREBY CERTIFY that on this 11th day of February, 2000, before me,
the undersigned officer, personally appeared Thomas P. Dunne, who acknowledged
himself/herself to be the President of Dunn Computer Operating Company, and that
(s)he, in such capacity, being authorized to do so, executed the foregoing
instrument for the purposes therein contained, by signing the name of Dunn
Computer Operating Company, as President of Dunn Computer Operating Company.

IN WITNESS WHEREOF, I hereunto set my hand and Notarial Seal.


                                                   /s/ Linda Kiechlin
                                                   ------------------
                                                      Notary Public

My Commission expires: 4/30/2003


                                      -22-
<PAGE>

STATE OF Virginia           )
                                  )SS:
CITY/COUNTY of Fairfax      )

      I HEREBY CERTIFY that on this 11th day of February, 2000, before me,
the undersigned officer, personally appeared David A. Dix, who acknowledged
himself/herself to be a Vice President of First Union National Bank, and that
(s)he, in such capacity, being authorized to do so, executed the foregoing
instrument for the purposes therein contained, by signing the name of First
Union National Bank, as Vice President of First Union National Bank.

      IN WITNESS WHEREOF, I hereunto set my hand and Notarial Seal.


                                                   /s/ [ILLEGIBLE]
                                                   ---------------
                                                    Notary Public

                                                    [NOTARY SEAL]

My Commission expires: 8/31/00


                                      -23-
<PAGE>

                         MODIFICATION OF REVOLVING NOTE

      THIS MODIFICATION OF REVOLVING NOTE (this "Modification") is made this
11th day of February, 2000 between DUNN COMPUTER CORPORATION (a Virginia
corporation), DUNN COMPUTER CORPORATION (a Delaware corporation), INTERNATIONAL
DATA PRODUCTS, CORP., STMS, INC., PUERTO RICO INDUSTRIAL MANUFACTURING
OPERATIONS ACQUISITION, CORP. and DUNN COMPUTER OPERATING COMPANY (collectively,
the "Borrower") and FIRST UNION NATIONAL BANK, holder of the Note (as defined
below) pursuant to an assignment from First Union Commercial Corporation to
First Union National Bank (the "Lender").

                  Preliminary Statements; Certain Defined Terms

      A. The Lender extended a revolving line of credit in the original
principal amount of $15,000,000 (the "Line of Credit") to the Borrower pursuant
to a Revolving Line of Credit Loan Agreement and Security Agreement dated May
27, 1999, as amended by an Addendum to Revolving Line of Credit Loan Agreement
and Security Agreement dated May 27,1999 and by a letter agreement dated May
27,1999 (collectively, the "Line of Credit Agreement"). The Line of Credit is
evidenced by a Revolving Note dated May 27,1999 from the Borrower to the Lender
in the original principal amount of $15,000,000 (the "Note"). A copy of the Note
is attached as Exhibit A.

      B. The Line of Credit is secured by, among other things, the Line of
Credit Agreement, whereby the Borrower granted to the Lender a security interest
in (i) all Accounts (ii) all payments or rights to payment due or to become due
under any Government Contract to which the Borrower is a party, (iii) all
deposits accounts and other obligations or indebtedness owed to the Borrower
from whatever source arising, (iv) all rights to receive any payment in money or
in kind, (v) all contact rights (except contract rights under Government
Contracts other than rights to payments due or to become due), (vi) all
Inventory, (vii) all property, plant and Equipment, (viii) all chattel paper,
(ix) all General Intangibles, (x) all books and records and computer hardware,
software (including, to the extent assignable, the Borrower's right to use
software licensed to the Borrower) and systems, (xi) all policies of insurance
and the proceeds thereof (xii) all additions and accessions thereto and
replacements thereof and (xiii) all products and proceeds thereof, as more
particularly described therein.

      C. The Line of Credit Agreement, the Note and all other documents
evidencing, securing, guaranteeing or otherwise related to the Line of Credit
are collectively called the "Loan Documents".

      D. As of December 14, 1999, there is due under the Line of Credit
principal of Two Million Three Hundred Thousand and 00/100 Dollars
($2,300,000.00) and interest of Seven
<PAGE>

Thousand Six Hundred Two and 84/100 Dollars ($7,602.84), plus attorneys' fees
and other costs which are payable under the Loan Documents.

      E. The Lender contends that the Borrower is in default under the Loan
Documents due to, among other things, violations of certain financial covenants
and financial reporting under the Line of Credit Agreement.

      F. The Borrower has requested that the Lender continue to make advances
under the Line of Credit and extend the maturity date of the Line of Credit
until November 30, 2000 and the Lender is willing to do so subject to the terms
and conditions set forth in a Modification Agreement of even date herewith (the
"Agreement").

      G. As a condition of entering into the Agreement, the Lender has required
that the Borrower execute and deliver this Modification.

      H. Therefore, the Borrower is executing this Modification amending the
Note as set forth herein.

      NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Borrower and the Lender agree as follows:

      1. The Borrower shall no longer have the option to elect to Reference
Rate-Based Option or the LIBOR-Based Rate Option. Commencing as of the date
hereof, the unpaid principal balance (both the existing unpaid principal balance
and future advances) of the Note shall bear interest at the Lender's "Prime
Rate" (as hereinafter defined) plus one percent (1%). "Prime Rate" means the
rate of interest from time to time established and publicly or privately
announced by the Lender as its then applicable prime rate of interest to be used
as an index in determining actual interest rates to be charged to certain
borrowers of the Lender. The rate of interest shall be adjusted as and when any
change in the "Prime Rate" shall occur. The Lender may establish and reestablish
the "Prime Rate" from time to time in its sole discretion, it being understood
and agreed that (a) such rate is intended merely as an index for setting
interest rates of the Lender and (b) the actual rate of interest to be charged
by the Lender to any particular borrower may be more than, equal to or less than
such index; provided, however, that at no time shall the rate of interest exceed
the highest rate permissible under applicable law. Interest shall be paid on the
first day of each month in arrears for the previous month.

      2. The Note shall mature on November 30, 2000, on which date, if not
sooner paid, the entire principal balance of the Note, all accrued and unpaid
interest thereon and all other sums due thereunder shall be due and payable in
full.

      3. The occurrence of an Event of Default (as defined in the Agreement)
under the Agreement shall constitute a default under the Note.


                                      -2-
<PAGE>

      4. Upon the occurrence of a default, interest shall accrue and be payable
at the applicable interest rate plus two percent (2%).

      5. The Borrower hereby acknowledges, consents and agrees (i) that the
provisions of the Note and the rights of all parties mentioned herein shall be
governed by the laws of the Commonwealth of Virginia and interpreted and
construed in accordance with such laws (excluding Virginia conflict of laws) and
(ii) that the United States District Court for the Eastern District of Virginia
and any court of competent jurisdiction of the Commonwealth of Virginia shall
have jurisdiction in any proceeding instituted to enforce the Note and any
objections to such venue are hereby waived.

      6. Nothing in this Modification changes any interest rate or other term or
condition applicable to the Note prior to the date of this Modification.

      7. This Modification does not extinguish the outstanding indebtedness
evidenced by the Note. Nothing herein contained shall be construed as a
substitution or novation of the original indebtedness or of the instruments
securing the same, which shall remain in full force and effect, except as
modified hereby or by instruments executed concurrently herewith. The Note as
modified hereby remains in full force and effect in accordance with its terms
and constitutes a binding obligation of the Borrower to the Lender. No further
modifications shall be effective unless in writing and signed by the Lender.

      8. The Borrower acknowledges and agrees that the indebtedness evidenced by
the Note is owed to the Lender without any setoffs, claims or defenses of any
kind, and the Borrower forever waives and relinquishes any and all defenses and
claims, of any kind, known or unknown, that the Borrower may have against the
Lender with regard to the Line of Credit.

      9. The Borrower and the Lender voluntarily and intentionally mutually
waive any right each may have to a trial by jury in any action, proceeding, or
litigation directly or indirectly arising out of, under or in connection with
this Modification, the Note, any other Loan Documents or any transactions
contemplated thereby.

      10. The Borrower shall reimburse the Lender for all reasonable attorneys'
fees, costs and expenses advanced or incurred in collecting and enforcing the
Note and/or the other Loan Documents, and/or in successfully defending or
prosecuting any actions or proceedings arising out of or relating to the Note
and/or the other Loan Documents. Until paid in full, all such fees, costs and
expenses to be paid by the Borrower shall bear interest from the date such fees,
costs or expenses are advanced or incurred by the Lender, at the then applicable
rate of interest on the Note.

      11. This Modification represents the entire agreement of the parties
hereto as it relates to the contents hereof; all prior oral and written
communications are merged herein.


                                      -3-
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have executed or caused to be
executed, this Agreement under seal as of the date first written above.

WITNESS/ATTEST:                   BORROWERS:

                                  DUNN COMPUTER CORPORATION,
                                  a Virginia corporation

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  DUNN COMPUTER CORPORATION,
                                  a Delaware corporation

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  INTERNATIONAL DATA PRODUCTS,
                                  CORP.

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  STMS, INC.

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                       -4-
<PAGE>

                                  PUERTO RICO INDUSTRIAL
                                  MANUFACTURING OPERATIONS
                                  ACQUISITION, CORP.

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  DUNN COMPUTER OPERATING
                                  COMPANY

/s/ Linda Kiechlin                By: /s/ Thomas P. Dunne (SEAL)
------------------                    --------------------------
                                      Name: Thomas P. Dunne
                                      Title: President


                                  LENDER:

                                  FIRST UNION NATIONAL BANK

/s/ [ILLEGIBLE]                   By: /s/ David A. Dix (SEAL)
------------------                    --------------------------
                                      David A. Dix
                                      Vice President


                                      -5-