<PAGE>

                            MASTER SECURITY AGREEMENT
                     dated as of April 2, 2004 ("AGREEMENT")

         THIS AGREEMENT is between GENERAL ELECTRIC CAPITAL CORPORATION
(together with its successors and assigns, if any, "SECURED PARTY") and AMERICAN
TECHNICAL CERAMICS CORP. ("DEBTOR"). Secured Party has an office at 44 Old
Ridgebury Road, Danbury, CT 06810-5105. Debtor is a corporation organized and
existing under the laws of the state of Delaware ("the State"). Debtor's mailing
address and chief place of business is 1 Norden Lane, Huntington Station, NY
11746.

1.       CREATION OF SECURITY INTEREST.

         Debtor grants to Secured Party, its successors and assigns, a security
interest in and against all property listed on any collateral schedule now or in
the future annexed to or made a part of this Agreement ("COLLATERAL SCHEDULE"),
and in and against all additions, attachments, accessories and accessions to
such property, all substitutions, replacements or exchanges therefor, and all
insurance and/or other proceeds thereof (all such property is individually and
collectively called the "COLLATERAL"). This security interest is given to secure
the payment and performance of all debts, obligations and liabilities of any
kind whatsoever of Debtor to Secured Party, now existing or arising in the
future, including but not limited to the payment and performance of certain
Promissory Notes from time to time identified on any Collateral Schedule
(collectively "NOTES" and each a "NOTE"), and any renewals, extensions and
modifications of such debts, obligations and liabilities (such Notes, debts,
obligations and liabilities are called the "Indebtedness").

2.       REPRESENTATIONS, WARRANTIES AND COVENANTS OF DEBTOR.

         Debtor represents, warrants and covenants as of the date of this
Agreement and as of the date of each Collateral Schedule that:

         (a) Debtor's exact legal name is as set forth in the preamble of this
Agreement and Debtor is, and will remain, duly organized, existing and in good
standing under the laws of the State set forth in the preamble of this
Agreement, has its chief executive offices at the location specified in the
preamble, and is, and will remain, duly qualified and licensed in every
jurisdiction wherever necessary to carry on its business of operations;

         (b) Debtor has adequate power and capacity to enter into, and to
perform its obligations under this Agreement, each Note and any other documents
evidencing, or given in connection with, any of the Indebtedness (all of the
foregoing are called the "DEBT DOCUMENTS");

         (c) This Agreement and the other Debt Documents have been duly
authorized executed and delivered by Debtor and constitute legal, valid and
binding agreements enforceable in accordance with their terms, except to the
extent that the enforcement of remedies may be limited under applicable
bankruptcy and insolvency laws;

         (d) No approval, consent or withholding of objections is required from
any governmental authority or instrumentality with respect to the entry into, or
performance by Debtor of any of the Debt Documents, except any already obtained;

         (e) The entry into, and performance by, Debtor of the debt Documents
will not (i) violate any of the organizational documents of Debtor or any
judgment, order, law or regulation applicable to Debtor, or (ii) result in any
breach of or constitute a default under any contract to which Debtor is a party,
or result in the creation of any lien, claim or encumbrance on any of Debtor's
property (except for liens in favor of Secured Party) pursuant to any indenture,
mortgage, deed of trust, bank loan, credit agreement, or other agreement or
instrument to which Debtor is a party;

         (f) There are no suits or proceedings pending in court or before any
commission, board or other administrative agency against or affecting Debtor
which could, in the aggregate, have a material adverse effect on Debtor, its
business or operations, or its ability to perform its obligations under the Debt
Documents, nor does debtor have reason to believe that any such suits or
proceedings are threatened;

         (g) All financial statements delivered to Secured Party in connection
with the Indebtedness have been prepared in accordance with generally accepted
accounting principles, and since the date of the most recent financial
statement, there has been no material adverse change in Debtors financial
condition;

         (h) The Collateral is not, and will not be, used by Debtor for
personal, family or household purposes;

         (i) The Collateral is, and will remain, in good condition and repair,
reasonable wear and tear excepted, and Debtor will not be negligent in its care
and use;

<PAGE>

         (j) Debtor is, and will remain, the sole and lawful owner, and in
possession of, the Collateral, and has the sole right and lawful authority to
grant the security interest described in this Agreement;

         (k) The Collateral is, and will remain, free and clear of all liens,
claims and encumbrances of any kind whatsoever, except for (i) liens in favor of
Secured Party, (ii) liens for taxes not yet due or for taxes being contested in
good faith and which do not involve, in the judgment of Secured Party, any risk
of the sale, forfeiture or loss of any of the Collateral, and (iii) inchoate
materialmen's, mechanic's, repairmen's and similar liens arising by operation of
law in the normal course of business for amounts which are not delinquent (all
of such liens are called "PERMITTED LIENS"); and

         (l) Debtor is and will remain in full compliance with all laws and
regulations applicable to it including, without limitation, (i) ensuring that no
person who owns a controlling interest in or otherwise controls Debtor is or
shall be (Y) listed on the Specially Designated Nationals and Blocked Person
List maintained by the Office of Foreign Assets Control ("OFAC"), Department of
the Treasury, and/or any other similar lists maintained by OFAC pursuant to any
authorizing statute, Executive Order or regulation or (Z) a person designated
under Section 1(b), (c) or (d) or Executive Order No. 13224 (September 23,
2001), any related enabling legislation or any other similar Executive Orders,
and (ii) compliance with all applicable Bank Secrecy Act ("BSA") laws,
regulations and government guidance on BSA compliance and on the prevention and
detection of money laundering violations.

3.       COLLATERAL.

         (a) Until the declaration of any default, Debtor shall remain in
possession of the Collateral; except that Secured Party shall have the right to
possess (i) any chattel paper or instrument that constitutes a part of the
Collateral, and (ii) any other Collateral in which Secured Party's security
interest may be perfected only by possession. Secured Party may inspect any of
the Collateral during normal business hours after giving Debtor reasonable prior
notice. If Secured Party asks, Debtor will promptly notify Secured Party in
writing of the location of any Collateral.

         (b) Debtor shall (i) use the Collateral only in its trade or business,
(ii) maintain all of the Collateral in good operating order and repair, normal
wear and tear excepted, (iii) use and maintain the Collateral only in compliance
with manufacturers recommendations and all applicable laws, and (iv) keep all of
the Collateral free and clear of all liens, claims and encumbrances (except for
Permitted Liens).

         (c) Secured Party does not authorize and Debtor agrees it shall not (i)
part with possession of any of the Collateral (except to Secured Party or for
maintenance and repair), (ii) remove any of the Collateral from the continental
United States, or (iii) sell, rent, lease, mortgage, license, grant a security
interest in or otherwise transfer or encumber (except for Permitted Liens) any
of the Collateral.

         (d) Debtor shall pay promptly when due all taxes, license fees,
assessments and public and private charges levied or assessed on any of the
Collateral, on its use, or on this Agreement or any of the other Debt Documents.
In the event Debtor fails to do so, and at its option, Secured Party may
discharge taxes, liens, security interests or other encumbrances at any time
levied or placed on the Collateral and may pay for the maintenance, insurance
and preservation of the Collateral and effect compliance with the terms of this
Agreement or any of the other Debt Documents. Debtor agrees to reimburse Secured
Party, on demand, all reasonable costs and expenses incurred by Secured Party in
connection with such payment or performance and agrees that such reimbursement
obligation shall constitute Indebtedness.

         (e) Debtor shall, at all times, keep accurate and complete records of
the Collateral, and secured Party shall have the right to inspect and make
copies of all of Debtor's books and records relating to the Collateral during
normal business hours, after giving Debtor reasonable prior notice.

         (f) Debtor agrees and acknowledges that any third person who may at any
time possess all or any portion or the Collateral shall be deemed to hold, and
shall hold, the Collateral as the agent of, and as pledge holder for, Secured
Party. Secured Party may at any time give notice to any third person described
in the preceding sentence that such third person is holding the Collateral as
the agent of, and as pledge holder for, the Secured Party.

4.       INSURANCE.

         (a) Debtor shall at all times bear the entire risk of any loss, theft,
damage to, or destruction of, any of the Collateral from any cause whatsoever.

         (b) Debtor agrees to keep the Collateral insured against loss or damage
by fire and extended coverage perils, theft, burglary, and for any or all
Collateral which are vehicles, for risk of loss by collision, and if requested
by Secured Party, against such other risks as Secured Party may reasonably
require. The insurance coverage shall be in an amount no less than the full
replacement
<PAGE>

value of the Collateral, and deductible amounts, insurers and policies shall be
acceptable to Secured Party. Debtor shall deliver to Secured Party policies or
certificates of insurance evidencing such coverage. Each policy shall name
Secured Party as a loss payee, shall provide for coverage to Secured Party
regardless of the breach by Debtor of any warranty or representation made
therein, shall not be subject to co-insurance, and shall provide that coverage
may not be canceled or altered by the insurer except upon thirty (30) days prior
written notice to Secured Party. Debtor appoints Secured Party as its
attorney-in-fact to make proof of loss, claim for insurance and adjustments with
insurers, and to receive payment of and execute or endorse all documents, checks
or drafts in connection with insurance payments. Secured Party shall not act as
Debtor's attorney-in-fact unless Debtor is in default. Proceeds of insurance
shall be applied, at the option of Secured Party, to repair or replace the
Collateral or to reduce any of the Indebtedness.

5.       REPORTS.

         (a) Debtor shall promptly notify Secured Party of (i) any change in the
name of Debtor, (ii) any change in the state of its incorporation, organization
or registration, (iii) any relocation of its chief executive offices, (iv) any
relocation of any of the Collateral, (v) any of the Collateral being lost,
stolen, missing, destroyed, materially damaged or worn out, or (vi) any lien,
claim or encumbrance other than Permitted Liens attaching to or being made
against any of the Collateral.

         (b) Debtor will deliver to Secured Party Debtor's complete financial
statements, certified by a recognized firm of certified public accountants,
within ninety (90) days of the close of each fiscal year of Debtor. If Secured
Party requests, Debtor will deliver to Secured Party copies of Debtor's
quarterly financial reports certified by Debtor's chief financial officer,
within ninety (90) days after the close of each of Debtor's fiscal quarter. If
Secured Party requests, Debtor will deliver to Secured Party copies of all Forms
10-K and 10-Q, if any, within 30 days after the dates on which they are filed
with the Securities Exchange Commission.

6.       FURTHER ASSURANCES.

         (a) Debtor shall, upon request of secured Party, furnish to Secured
Party such further information, execute and deliver to Secured Party such
documents and instruments (including, without limitation, Uniform Commercial
Code financing statements) and shall do such other acts and things as Secured
Party may at any time reasonably request relating to the perfection or
protection of the security interest created by this Agreement or for the purpose
of carrying out the intent of this Agreement. Without limiting the foregoing,
Debtor shall cooperate and do all acts deemed necessary or advisable by Secured
Party to continue in Secured Party a perfected first security interest in the
Collateral, and shall obtain and furnish to Secured Party any subordinations,
releases, landlord waivers, lessor waivers, mortgagee waivers, or control
agreements, and similar documents as may be from time to time reasonably
requested by, and in form and substance satisfactory to, Secured Party.

         (b) Debtor authorizes Secured Party to file a financing statement and
amendments thereto describing the Collateral and containing any other
information required by the applicable Uniform Commercial Code. Debtor
irrevocably grants to Secured Party the power to sign Debtor's name and
generally to act on behalf of Debtor to execute and file applications for title,
transfers of title, financing statements, notices of lien and other documents
pertaining to any or all of the Collateral; this power is coupled with Secured
Party's interest in the Collateral. Secured Party shall not so act unless Debtor
fails to comply with Secured Party's request for it to do so or is otherwise in
default. Debtor shall, if any certificate of title be required or permitted by
law for any of the Collateral, obtain and promptly deliver to Secured Party such
certificate showing the lien of this Agreement with respect to the Collateral.
Debtor ratifies its prior authorization for Secured party to file financing
statements and amendments thereto describing the Collateral and containing any
other information required by the Uniform Commercial Code if filed prior to the
date hereof.

         (c) Debtor shall indemnify and defend the Secured Party, its successors
and assigns, and their respective directors, officers and employees, from and
against all claims, actions and suits (including, without limitation, related
attorney's fees) of any kind whatsoever arising, directly or indirectly, in
connection with any of the Collateral, other than claims actions or suits
resulting from Secured Party's gross negligence or willful misconduct.

7.       DEFAULT AND REMEDIES.

         (a) Debtor shall be in default under this Agreement and each of the
other Debt Documents if:

              (i) Debtor breaches its obligation to pay when due any installment
or other amount due or coming due under any of the Debt Documents;

              (ii) Debtor, without the prior written consent of Secured Party,
attempts to or does sell, rent, lease, license, mortgage, grant a security
interest in, or otherwise transfer or encumber (except for Permitted Liens) any
of the Collateral;

<PAGE>

              (iii) Debtor breaches any of its insurance obligations under
Section 4;

              (iv) Debtor breaches any of its other obligations under any of the
Debt Documents and fails to cure that breach within thirty (30) days after
written notice from Secured Party;

              (v) Any warranty, representation or statement made by Debtor in
any of the Debt Documents or otherwise in connection with any of the
Indebtedness shall be false or misleading in any material respect;

              (vi) Any of the Collateral is subjected to attachment, execution,
levy, seizure or confiscation in any legal proceeding or otherwise, or if any
legal or administrative proceeding is commended against Debtor or any of the
Collateral, which in the good faith judgment of Secured Party subjects any of
the Collateral to a material risk of attachment, execution, levy, seizure or
confiscation and no bond is posted or protective order obtained to negate such
risk;

              (vii) Debtor breaches or is in default under any other agreement
between Debtor and Secured Party;

              (viii) Debtor or any guarantor or other obligor for any of the
Indebtedness (collectively "GUARANTOR") dissolves, terminates its existence,
becomes insolvent or ceases to do business as a going concern;

              (ix) If Debtor or any Guarantor is a natural person, Debtor or any
such Guarantor dies or becomes incompetent;

              (x) A receiver is appointed for all or of any part of the property
of Debtor or any Guarantor, or Debtor or any Guarantor makes any assignment for
the benefit of creditors;

              (xi) Debtor or any Guarantor files a petition under any
bankruptcy, insolvency or similar law, or any such petition is filed against
Debtor or any Guarantor and is not dismissed within forty-five (45) days;

              (xii) Debtor's improper filing of an amendment or termination
statement relating to a filed financing statement describing the Collateral; or

              (xiii) Any Guarantor revokes or attempts to revoke its guaranty of
any of the Indebtedness or fails to observe or perform any covenant, condition
or agreement to be performed under any guaranty or other related document to
which it is a party.

         (b) If Debtor is in default, the Secured Party, at its option, may
declare any or all of the Indebtedness to be immediately due and payable,
without demand or notice to Debtor or any Guarantor. The accelerated obligations
and liabilities shall bear interest (both before and after any judgment) until
paid in full at the lower of eighteen percent (18%) per annum or the maximum
rate not prohibited by applicable law.

         (c) After default, Secured Party shall have all of the rights and
remedies of a Secured Party under the Uniform Commercial Code, and under any
other applicable law. Without limiting the foregoing, Secured Party shall have
the right to (i) notify any account debtor or Debtor or any obligor on any
instrument which constitutes part of the Collateral to make payment of the
Secured Party, (ii) with or without legal process, enter any premises where the
Collateral may be and take possession of and remove the Collateral from the
premises or store it on the premises, (iii) sell the Collateral at public or
private sale, in whole or in part, and have the right to bid and purchase at
said sale, or (iv) lease or otherwise dispose of all or part of the Collateral,
applying proceeds from such disposition to the obligations then in default. If
requested by Secured Party, Debtor shall promptly assemble the Collateral and
make it available to Secured Party at a place to be designated by Secured Party
which is reasonably convenient to both parties. Secured Party may also render
any or all of the Collateral unusable at the Debtor's premises and may dispose
of such Collateral on such premises without liability for rent or costs. Any
notice that Secured Party is required to give to Debtor under the Uniform
Commercial Code of the time and place of any public sale or the time after which
any private sale or other intended disposition of the Collateral is to be made
shall be deemed to constitute reasonable notice if such notice is given to the
last known address of Debtor at least five (5) days prior to such action.

         (d) Proceeds from any sale or lease or other disposition shall be
applied: first, to all costs of repossession, storage, and disposition,
including, without limitation attorney's, appraiser's, and auctioneers' fees;
second, to discharge the obligations then in default; third, to discharge any
other Indebtedness of Debtor to Secured Party, whether as obligor, endorser,
guarantor, surety or indemnitor; fourth, to expenses incurred in paying or
settling liens and claims against the Collateral; and lastly, to Debtor, if
there exists any surplus. Debtor shall remain fully liable for an deficiency.

         (e) Debtor agrees to pay all reasonable attorney's fees and other costs
incurred by Secured Party in connection with the enforcement, assertion, defense
or preservation of Secured Party's rights and remedies under this Agreement, or
if prohibited by law, such lesser sum as may be permitted. Debtor further agrees
that such fees and costs shall constitute Indebtedness.

<PAGE>

         (f) Secured Party's rights and remedies under this Agreement or
otherwise arising are cumulative and may be exercised singularly or
concurrently. Neither the failure nor any delay on the part of the Secured Party
to exercise any right, power or privilege under this Agreement shall operate as
a waiver, nor shall any single or partial exercise of any right, power or
privilege preclude any other or further exercise of that or any other right,
power or privilege. SECURED PARTY SHALL NOT BE DEEMED TO HAVE WAIVED ANY OF ITS
RIGHTS UNDER THIS AGREEMENT OR UNDER ANY OTHER AGREEMENT, INSTRUMENT OR PAPER
SIGNED BY DEBTOR UNLESS SUCH WAIVER IS EXPRESSED IN WRITING AND SIGNED BY
SECURED PARTY. A waiver on any one occasion shall not be construed as a bar to
or waiver of any right or remedy on any future occasion.

         (g) DEBTOR AND SECURED PARTY UNCONDITIONALLY WAIVE THEIR RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT, ANY OF THE OTHER DEBT DOCUMENTS, ANY OF THE INDEBTEDNESS SECURED
HEREBY, ANY DEALINGS BETWEEN DEBTOR AND SECURED PARTY RELATING TO THE SUBJECT
MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP
THAT IS BEING ESTABLISHED BETWEEN DEBTOR AND SECURED PARTY. THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY COURT. THIS WAIVER IS IRREVOCABLE. THIS WAIVER MAY NO BE MODIFIED
EITHER ORALLY OR IN WRITING. THE WAIVER ALSO SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT, ANY OTHER
DEBT DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS
TRANSACTION OR ANY RELATED TRANSACTION. THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.


8.       MISCELLANEOUS.

         (a) This Agreement, any Note and/or any of the other Debt Documents may
be assigned, in whole or in part, by Secured Party without notice to Debtor, and
Debtor agrees not to assert against any such assignee, or assignee's assigns,
any defense, set-off, recoupment claim or counterclaim which Debtor has or may
at any time have against Secured Party for any reason whatsoever. Debtor agrees
that if Debtor receives written notice of an assignment from Secured Party,
Debtor will pay all amounts payable under any assigned Debt Documents to such
assignee or as instructed by Secured Party. Debtor also agrees to confirm in
writing receipt of the notice of assignment as may be reasonably requested by
Secured Party or assignee.

         (b) All notices to be given in connection with this Agreement shall be
in writing, shall be addressed to the parties at their respective addresses set
forth in this Agreement (unless and until a different address may be specified
in a written notice to the other party), and shall be deemed given (i) on the
date of receipt if delivered in hand or by facsimile transmission, (ii) on the
next business day after being sent by expires mail, and (iii) on the fourth
business day after being sent by regular, registered or certified mail. As used
herein, the term "business day" shall mean and include any day other than
Saturdays, Sundays, or other days on which commercial banks in New York, New
York are required or authorized to be closed.

         (c) Secured Party may correct patent errors and fill in all blanks in
this Agreement or in any Collateral Schedule consistent with the agreement of
the parties.


         (d) Time is of the essence of this Agreement. This Agreement shall be
binding, jointly and severally, upon all parties described as the "Debtor" and
their respective heirs, executors, representatives, successors and assigns, and
shall inure to the benefit of Secured Party, its successors and assigns.


         (e) This Agreement and its Collateral Schedules constitute the entire
agreement between the parties with respect to the subject matter of this
Agreement and supersede all prior understandings (whether written, verbal or
implied) with respect to such subject matter. THIS AGREEMENT AND ITS COLLATERAL
SCHEDULES SHALL NOT BE CHANGED OR TERMINATED ORALLY OR BY COURSE OF CONDUCT, BUT
ONLY BY A WRITING SIGNED BY BOTH PARTIES. Section headings contained in this
Agreement have been included for convenience only, and shall not affect the
construction or interpretation of this Agreement.

         (f) This Agreement shall continue in full force and effect until all of
the Indebtedness has been indefeasibly paid in full to Secured Party or its
assignee. The surrender, upon payment or otherwise, of any Note or any of the
other documents evidencing any of the Indebtedness shall not affect the right of
Secured Party to retain the Collateral for such other Indebtedness as may then
exist or as it may be reasonably contemplated will exist in the future. This
Agreement shall automatically be reinstated if Secured Party is ever required to
return or restore the payment of all or any portion of the Indebtedness (all as
though such payment had never been made).

         (g)  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
              HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN
              ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CONNECTICUT
              (WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE),
              INCLUDING AL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
              REGARDLESS OF THE LOCATION OF THE COLLATERAL.

<PAGE>

IN WITNESS WHEREOF, Debtor and Secured Party, intending to be legally bound
hereby, have duly executed this Agreement in one or more counterparts, each of
which shall be deemed to be an original, as of the day and year first aforesaid.

SECURED PARTY:                                 DEBTOR:

GENERAL ELECTRIC CAPITAL CORPORATION           AMERICAN TECHNICAL CERAMICS CORP.

By:    /S/ JAMES R. COSTELLO                   By:    /S/ ANDREW R. PERZ
Name:  James R. Costello                       Name:  Andrew R. Perz
Title: Senior Risk Analyst                     Title: Vice President, Controller


<PAGE>


     CROSS-COLLATERAL AND CROSS-DEFAULT AGREEMENT

General Electric Capital Corporation
44 Old Ridgebury Road
Danbury, CT 06810-5105


Gentlemen:

         You (and/or your successors or assigns, "YOU") have entered into or
purchased one or more conditional sale contracts, lease agreements, chattel
mortgages, security agreements, notes and other choses in action (herein
designated "ACCOUNTS") arising from the bona fide sale or lease to us, by
various vendors or lessors, of equipment and inventory (herein designated
"COLLATERAL") and/or you have made direct loans to or otherwise extended credit
to us evidenced by Accounts creating security interests in Collateral.

         In order to induce you to extend our time of payment on one or more
Accounts and/or to make additional loans to us and/or to purchase additional
Accounts and/or to lease us additional equipment, and in consideration of you so
doing, and for other good and valuable consideration, the receipt of which we
hereby acknowledge, we agree as follows:

         All presently existing and hereafter acquired Collateral in which you
have or shall have a security interest shall secure the payment and performance
of all of our liabilities and obligations to you of every kind and character,
whether joint or several, direct or indirect, absolute or contingent, due or to
become due, and whether under presently existing or hereafter created Accounts
or agreements, or otherwise.

         We further agree that your security interest in the property covered by
any Account now held or hereafter acquired by you shall not be terminated in
whole or in part until and unless all indebtedness of every kind, due or to
become due, owed by us to you is fully paid and satisfied and the terms of every
Account have been fully performed by us. It is further agreed that you are to
retain your security interest in all property covered by all Accounts held or
acquired by you, as security for payment and performance under each such
Account, notwithstanding the fact that one or more of such Accounts may become
fully paid.

         This instrument is intended to create cross-default and cross-security
between and among all the within described Accounts now owned or hereafter
acquired by you.

         A default under any Account or agreement shall be deemed to be a
default under all other Accounts and agreements. Upon our default any or all
Accounts and agreements shall, at your option, become immediately due and
payable without notice or demand to us or any other party obligated thereon, and
you shall have and may exercise any and all rights and remedies of a secured
party under the Uniform Commercial Code as enacted in the applicable
jurisdiction and as otherwise granted to you under any Account or other
agreement. We hereby waive, to the maximum extent permitted by law, notices of
default, notices or repossession and sale or other disposition of collateral,
and all other notices, and in the event any such notice cannot be waived, we
agree that if such notice is mailed to us postage prepaid at the address shown
below at least five (5) days prior to the exercise by you of any of your rights
or remedies, such notice shall be deemed to be reasonable and shall fully
satisfy any requirement for giving notice.

         All rights granted to you hereunder shall be cumulative and not
alternative, shall be in addition to and shall in no manner impair or affect
your rights and remedies under any existing Account, agreement, statute or rule
of law.

         This agreement may not be varied or altered nor its provisions waived
except by your duly executed written agreement. This agreement shall inure to
the benefit of your successors and assigns and shall be binding upon our heirs,
administrators, executors, legal representatives, successors and assigns.

         IN WITNESS WHEREOF, this agreement is executed this 2nd day of April,
2004.

                         American Technical Ceramics Corp.
                         (Name of Proprietorship, Partnership or
                         Corporation, as applicable)

                         By: /S/ ANDREW R. PERZ
                             -------------------
                                 (Signature)

                         Title: Vice President, Controller
                                --------------------------
                         (Owner, Partner or Officer, as applicable)
                         Address:  1 Norden Lane, Huntington Station, NY 11746


<PAGE>


                            UNANIMOUS WRITTEN CONSENT

                                     OF THE

                               BOARD OF DIRECTORS

                                       OF

                        AMERICAN TECHNICAL CERAMICS CORP.


         The undersigned, being all of the directors of American
Technical Ceramics Corp., a Delaware corporation (the "Corporation"),
do hereby consent to the adoption of the following resolutions:


                   RESOLVED, that the President, the Vice President,
              Controller and the Vice President - Administration and
              Secretary of this Corporation be, and each of them, with
              full authority to act without the others, hereby is,
              authorized, on behalf of and in the name of this
              Corporation: (i) to apply for, negotiate, arrange for
              and obtain a capital expenditure line of credit from GE
              Commercial Equipment Financing, a unit of General
              Electric Capital Corporation ("GE"), in an amount up to
              $4,000,000, said line to have a term of one-year with
              borrowings thereunder (A) to be payable over 60 months
              from the time they are accessed, (B) to bear interest,
              at the Corporation's option, at either (1) a fixed rate
              equal to the five-year treasury bond yield at the time
              such funds are accessed plus 3.47%, or (2) a floating
              rate equal to the monthly London InterBank Offering Rate
              plus 3.65% (subject to the Corporation's right to
              convert to a fixed rate of interest during the term
              thereof), (C) to be secured by the equipment purchased
              with the proceeds from such line, and (D) to be upon
              such other terms and conditions as are set forth on
              Exhibit A hereto and/or as such officers, or any of
              them, deem necessary or appropriate; (ii) to execute,
              endorse or deliver in connection with such line such
              applications, promissory notes, checks, drafts,
              acceptances, contracts, agreements (including, without
              limitation, security agreements), and other instruments
              or obligations, waivers of trial by jury and agreements
              as to judicial jurisdiction on such terms as such
              officers, or any of them, deem necessary or appropriate;
              (iii) to request and direct proceeds (or authorize
              others to request and direct proceeds) of such line to
              any person, entity, account or obligation; and (iv) in
              implementation of the authority hereby conferred, to
              execute, endorse and deliver such documents in favor of
              GE and its affiliates on forms required by any such
              entities, deemed necessary or appropriate by such
              officers, or any of them, to commit, originate,
              implement, substitute, exchange, amend, supplement,
              extend, renew, release or discharge any of the
              foregoing; and it is further

<PAGE>

                   RESOLVED, that any actions previously taken by the
              Corporation's officers, or any of them, in connection
              with such line be, and hereby are, confirmed, ratified
              and approved in all respects; and it is further

                   RESOLVED, that the officers of the Corporation, be,
              and each of them, with full authority to act without the
              others, hereby is, authorized and directed to execute
              and deliver such instruments, documents and agreements
              and to take such other action as they, in their
              discretion, deem necessary, desirable or appropriate in
              order to carry out the intent and effectuate the
              purposes of the foregoing resolutions.

         The Consent may be executed in any number of counterparts and
shall be effective when at least one counterpart is executed by each
of the undersigned.

         IN WITNESS WHEREOF, each of the undersigned has executed this
Consent as of the date set forth opposite his name.

               March 31, 2004                         /S/ VICTOR D. INSETTA
         ----------------------------             ------------------------------
                                                        Victor D. Insetta

               April 1, 2004                          /S/ DOV S. BACHARACH
         ----------------------------             ------------------------------
                                                        Dov S. Bacharach

               April 1, 2004                       /S/ O. JULIAN GARRARD, III
         ----------------------------             ------------------------------
                                                     O. Julian Garrard, III

               March 31, 2004                          /S/ STUART P. LITT
         ----------------------------             ------------------------------
                                                         Stuart P. Litt

               April 6, 2004                          /S/ CHESTER E. SPENCE
         ----------------------------             ------------------------------
                                                        Chester E. Spence

               April 1, 2004                           /S/ THOMAS J. VOLPE
         ----------------------------             ------------------------------
                                                         Thomas J. Volpe