Document:

Exhibit 4.3

Exhibit 4.3

REVOLVING DEMAND NOTE

December 13, 2010

			
	 	 	 
	$2,250,000.00
	 	Pittsburgh, Pennsylvania

For value received, the undersigned Orbit/FR, Inc., a Delaware corporation, with an address of
506 Prudential Road, Horsham, Pennsylvania 19044, Advanced ElectroMagnetics, Inc., a California
corporation, with an address of 9311 Stevens Road San Tee, CA 92071, Orbit Advanced Technologies,
Inc., a Delaware corporation, with an address of 506 Prudential Road, Horsham, Pennsylvania 19044
and Flam & Russell, Inc., a Delaware corporation, with an address of 506 Prudential Road, Horsham,
Pennsylvania 19044 (collectively, the “Borrower”), jointly and severally, promise to pay to the
order of Citizens Bank of Pennsylvania, a Pennsylvania, state-chartered bank with an address of 525
William Penn Place, Pittsburgh, Pennsylvania 15219-1724 (together with its successors and assigns,
the “Bank”), ON DEMAND, the principal amount of Two Million Two Hundred Fifty Thousand Dollars and
Zero Cents ($2,250,000.00) or, if less, such amount as may be the aggregate unpaid principal amount
of all loans or advances made by the Bank to the Borrower pursuant hereto, together with interest
from the date hereof on the unpaid principal balance from time to time outstanding until paid in
full. The aggregate principal balance outstanding shall bear interest thereon at a per annum rate
equal to Two and One-Quarter Percent (2.25%) above the LIBOR Advantage Rate (as hereinafter
defined) for any Interest Period (as hereinafter defined). All accrued and unpaid interest shall be
payable monthly in arrears on the 15 of each month following the end of an Interest Period.

LA Interest Period means with respect to any LIBOR Advantage Loan, the period commencing on
(and including) the date of this Note (the “Start Date”) and ending on the numerically
corresponding date one month later, and thereafter each one month period ending on the day of such
month that numerically corresponds to the Start Date. If an LA Interest Period is to end in a month
for which there is no day which numerically corresponds to the Start Date, the Interest Period will
end on the last day of such month.

Notwithstanding the date of commencement of any LA Interest Period, interest shall only begin
to accrue as of the date the initial LIBOR Advantage Loan is made hereunder.

LIBOR Advantage Rate means relative to any LA Interest Period, the offered rate for delivery
in two London Banking Days (as hereinafter defined) of deposits of U.S. Dollars for a term
coextensive with the designated LA Interest Period which the British Bankers’ Association fixes as
its LIBOR Advantage Rate as of 11:00 a.m. London time on the day on which the LA Interest Period
commences, and for a period approximately equal to such Interest Period. If the first day of any LA
Interest Period is not a day which is both a (i) Business Day (as hereinafter defined), and (ii) a
day on which US dollar deposits are transacted in the London interbank market (a “London Banking
Day”), the LIBOR Advantage Rate shall be determined in reference to the next preceding day which is
both a Business Day and a London Banking Day. If for any reason the LIBOR Advantage Rate is
unavailable and/or the Bank is unable to determine the LIBOR Advantage Rate for any LA Interest
Period, the Bank may, at its discretion, either: (a) select a replacement index based on the
arithmetic mean of the quotations, if any, of the interbank offered rate by first class banks in
London or New York for deposits with comparable maturities or (b) accrue interest at a rate per
annum equal to the Bank’s Prime rate as of the first day of any LA Interest Period for which the
LIBOR Advantage Rate is unavailable or cannot be determined. “Business Day” means, any day which is
neither a Saturday, Sunday nor a legal holiday on which commercial banks are authorized or required
to be closed.

This Note is secured by all collateral granted to the Bank by the Borrower or any endorser or
guarantor hereof or by any other party and shall be secured by any additional collateral hereafter
granted to the Bank by the Borrower or any endorser or guarantor hereof or by any other party.

 

 

 

Principal and interest shall be payable at the Bank’s main office or at such other place as
the Bank may designate in writing in immediately available funds in lawful money of the United
States of America without set-off, deduction or counterclaim. Interest shall be calculated on the
basis of actual number of days elapsed and a 360-day year.

This Note is a revolving note and, subject to the foregoing and in accordance with the
provisions hereof and of any and all other agreements between the Borrower and the Bank related
hereto, the Borrower may, at its option, borrow, pay, prepay and reborrow hereunder at any time
prior to demand for payment hereunder or such earlier date as the obligations of the Borrower to
the Bank under this Note, and any other agreements between the Bank and the Borrower related
hereto, shall become due and payable, or the obligation of the Bank to extend financial
accommodations to the Borrower shall terminate; provided, however, that in any event the principal
balance outstanding hereunder shall at no time exceed the face amount of this Note. This Note shall
continue in full force and effect until all obligations and liabilities evidenced by this Note are
paid in full and the Bank is no longer obligated to extend financial accommodations to the
Borrower, even if, from time to time, there are no amounts outstanding respecting this Note.

BORROWER HEREBY AUTHORIZES AND EMPOWERS ANY ATTORNEY OR ATTORNEYS OR THE PROTHONOTARY OR CLERK
OF ANY COURT OF RECORD IN THE COMMONWEALTH OF PENNSYLVANIA OR IN ANY OTHER JURISDICTION, UPON THE
OCCURRENCE OF AN EVENT OF DEFAULT, TO APPEAR FOR BORROWER IN ANY SUCH COURT, WITH OR WITHOUT
DECLARATION FILED, AS OF ANY TERM OR TIME THERE OR ELSEWHERE TO BE HELD AND THEREIN TO CONFESS OR
ENTER JUDGMENT AGAINST BORROWER IN FAVOR OF THE BANK FOR ALL SUMS DUE OR TO BECOME DUE BY BORROWER
TO THE BANK UNDER THIS NOTE, WITH COSTS OF SUIT AND RELEASE OF ERRORS AND WITH THE GREATER OF FIVE
PERCENT (5%) OF SUCH SUMS OR $10,000 ADDED AS A REASONABLE ATTORNEY’S FEE AND FOR DOING SO THIS
NOTE OR A COPY VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. SUCH AUTHORITY AND POWER SHALL
NOT BE EXHAUSTED BY ANY EXERCISE THEREOF, AND JUDGMENT MAY BE CONFESSED AS AFORESAID FROM TIME TO
TIME AS OFTEN AS THERE IS OCCASION THEREFOR.

BORROWER ACKNOWLEDGES THAT IT HAS BEEN OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED BY COUNSEL
IN CONNECTION WITH THE EXECUTION AND DELIVERY OF THIS NOTE AND THAT IT KNOWINGLY WAIVES ITS RIGHT
TO BE HEARD PRIOR TO THE ENTRY OF SUCH JUDGMENT AND UNDERSTANDS THAT, UPON SUCH ENTRY, SUCH
JUDGMENT SHALL BECOME A LIEN ON ALL REAL PROPERTY OF BORROWER IN THE COUNTY WHERE SUCH JUDGMENT IS
ENTERED.

Any payments received by the Bank on account of this Note shall, at the Bank’s option, be
applied first, to accrued and unpaid interest; second, to the unpaid principal balance hereof;
third to any costs, expenses or charges then owed to the Bank by the Borrower; and the balance to
escrows, if any. Notwithstanding the foregoing, any payments received after demand for payment
shall be applied in such manner as the Bank may determine. The Borrower hereby authorizes the Bank
to charge any deposit account which the Borrower may maintain with the Bank for any payment
required hereunder without prior notice to the Borrower.

If pursuant to the terms of this Note, the Borrower is at any time obligated to pay interest
on the principal balance at a rate in excess of the maximum interest rate permitted by applicable
law for the loan evidenced by this Note, the applicable interest rate shall be immediately reduced
to such maximum rate and all previous payments in excess of the maximum rate shall be deemed to
have been payments in reduction of principal and not on account of the interest due hereunder.

The Borrower represents to the Bank that the proceeds of this Note will not be used for
personal, family or household purposes or for the purpose of purchasing or carrying margin stock
or margin securities within the meaning of Regulations U and X of the Board of Governors of the
Federal Reserve System, 12 C.F.R. Parts 221 and 224.

 

2

 

The Borrower and each endorser and guarantor hereof grant to the Bank a continuing lien on and
security interest in any and all deposits or other sums at any time credited by or due from the
Bank or any Bank Affiliate (as hereinafter defined) to the Borrower and/or each endorser or
guarantor hereof and any cash, securities, instruments or other property of the Borrower and each
endorser and guarantor hereof in the possession of the Bank or any Bank Affiliate, whether for
safekeeping or otherwise, or in transit to or from the Bank or any Bank Affiliate (regardless of
the reason the Bank or Bank Affiliate had received the same or whether the Bank or Bank Affiliate
has conditionally released the same) as security for the full and punctual payment and performance
of all of the liabilities and obligations of the Borrower and/or any endorser or guarantor hereof
to the Bank or any Bank Affiliate and such deposits and other sums may be applied or set off
against such liabilities and obligations of the Borrower or any endorser or guarantor hereof to the
Bank or any Bank Affiliate at any time, whether or not such are then due, whether or not demand has
been made and whether or not other collateral is then available to the Bank or any Bank Affiliate.

No delay or omission on the part of the Bank in exercising any right hereunder shall operate
as a waiver of such right or of any other right of the Bank, nor shall any delay, omission or
waiver on any one occasion be deemed
a bar to or waiver of the same or any other right on any future occasion. The Borrower and
every endorser or guarantor of this Note, regardless of the time, order or place of signing, waives
presentment, demand, protest, notice of intent to accelerate, notice of acceleration and all other
notices of every kind in connection with the delivery, acceptance, performance or enforcement of
this Note and assents to any extension or postponement of the time of payment or any other
indulgence, to any substitution, exchange or release of collateral, and to the addition or release
of any other party or person primarily or secondarily liable and waives all recourse to suretyship
and guarantor defenses generally, including any defense based on impairment of collateral. To the
maximum extent permitted by law, the Borrower and each endorser and guarantor of this Note waive
and terminate any homestead rights and/or exemptions respecting any premises under the provisions
of any applicable homestead laws, including without limitation, Title 42, Section 8123, of the
Pennsylvania Consolidated Statutes Annotated.

Borrower hereby waives and releases all errors, defects and imperfections in any proceedings
instituted by the Bank under the terms of this Note or any other loan documents, as well as all
benefits that might accrue to the Borrower by virtue of any present or future laws exempting any
property, real or personal, or any part of the proceeds arising from any sale of such property,
from attachment, levy or sale under execution or providing for any stay of execution, exemption
from civil process or extension of time for payment, as well as the right of inquisition on any
real estate that may be levied upon under a judgment obtained by virtue hereof, and Borrower hereby
voluntarily condemns the same and authorizes the entry of such voluntary condemnation on any writ
of execution issued thereon, and agrees that such real estate may be sold upon any such writ in
whole or in part in any order desired by the Bank.

The Borrower and each endorser and guarantor of this Note shall indemnify, defend and hold the
Bank and the Bank Affiliates and their directors, officers, employees, agents and attorneys (each
an “Indemnitee”) harmless against any claim brought or threatened against any Indemnitee by the
Borrower, by any endorser or guarantor, or by any other person (as well as from attorneys’
reasonable fees and expenses in connection therewith) on account of the Bank’s relationship with
the Borrower or any endorser or guarantor hereof (each of which may be defended, compromised,
settled or pursued by the Bank with counsel of the Bank’s selection, but at the expense of the
Borrower and any endorser and/or guarantor), except for any claim arising out of the gross
negligence or willful misconduct of the Bank.

The Borrower and each endorser and guarantor of this Note agree to pay, upon demand, costs of
collection of all amounts under this Note including, without limitation, principal and interest,
or in connection with the enforcement of, or realization on, any security for this Note,
including, without limitation, to the extent permitted by applicable law, reasonable attorneys’
fees and expenses. Upon demand for payment of any amounts hereunder, interest shall accrue at a
rate per annum equal to the aggregate of 5.0% plus the rate provided for herein. If any payment
due under this Note is unpaid for 10 days or more, the Borrower shall pay, in addition to any
other sums due under this Note (and without limiting the Bank’s other remedies on account
thereof), a late charge equal to the greater of $35.00 or 5.0% of such unpaid amount. In addition
the Borrower shall pay the Bank’s customary fee if any payment made on account of this Note is
dishonored.

 

3

 

This Note shall be binding upon the Borrower and each endorser and guarantor hereof and upon
their respective heirs, successors, assigns and legal representatives, and shall inure to the
benefit of the Bank and its successors, endorsees and assigns.

The liabilities of the Borrower and each Borrower, if more than one, and any endorser or
guarantor of this Note are joint and several; provided, however, the release by the Bank of the
Borrower or any one or more endorsers or guarantors shall not release any other person obligated on
account of this Note. Any and all present and future debts of the Borrower to any endorser or
guarantor of this Note are subordinated to the full payment and performance of all present and
future debts and obligations of the Borrower to the Bank. Each reference in this Note to the
Borrower and each Borrower, if more than one, and endorser or guarantor of this Note, is to such
person individually and also to all such persons jointly. No person obligated on account of this
Note may seek contribution from any other person also obligated, unless and until all liabilities,
obligations and indebtedness to the Bank of the person from whom contribution is sought have been
irrevocably satisfied in full. The release or compromise by the Bank of any collateral shall not
release any person obligated on account of this Note.

The Borrower and each endorser and guarantor hereof each authorizes the Bank to complete this
Note if delivered incomplete in any respect. A photographic or other reproduction of this Note may
be made by the Bank, and any such reproduction shall be admissible in evidence with the same effect
as the original itself in any judicial or administrative proceeding, whether or not the original is
in existence.

The Borrower will from time to time execute and deliver to the Bank such documents, and take
or cause to be taken, all such other further action, as the Bank may request in order to effect and
confirm or vest more securely in the Bank all rights contemplated by this Note or any other loan
documents related thereto (including, without limitation, to correct clerical errors) or to vest
more fully in or assure to the Bank the security interest in any collateral securing this Note or
to comply with applicable statute or law.

This Note shall be governed by federal law applicable to the Bank and, to the extent not
preempted by federal law, the laws of the Commonwealth of Pennsylvania.

Any notices under or pursuant to this Note shall be deemed duly received and effective if
delivered in hand to any officer or agent of the Borrower or Bank, or if mailed by registered or
certified mail, return receipt requested, addressed to the Borrower or Bank at the address set
forth in this Note or as any party may from time to time designate by written notice to the other
party.

The term “Bank Affiliate” as used in this Note shall mean any “Affiliate” of the Bank or any
lender acting as a participant under any loan arrangement between the Bank and the Borrower(s).
The term “Affiliate” shall mean with respect to any person, (a) any person which, directly or
indirectly through one or more intermediaries controls, or is controlled by, or is under common
control with, such person, or (b) any person who is a director or officer (i) of such person, (ii)
of any subsidiary of such person, or (iii) any person described in clause (a) above. For purposes
of this definition, control of a person shall mean the power, direct or indirect, (x) to vote 5%
or more of the Capital Stock having ordinary voting power for the election of directors (or
comparable equivalent) of such person, or (y) to direct or cause the direction of the management
and policies of such person whether by contract or otherwise. Control may be by ownership,
contract, or otherwise.

 

4

 

The Borrower and each endorser and guarantor of this Note each irrevocably submits to the
nonexclusive jurisdiction of any Federal or state court sitting in Pennsylvania, over any suit,
action or proceeding arising out of or relating to this Note. Each of the Borrower and each
endorser and guarantor irrevocably waives, to the fullest extent it may effectively do so under
applicable law, any objection it may now or hereafter have to the laying of the venue of any such
suit, action or proceeding brought in any such court and any claim that the same has been brought
in an inconvenient forum. Each of the Borrower and each endorser and guarantor hereby consents to
any and all process which may be served in any such suit, action or proceeding, (i) by mailing a
copy thereof by registered and certified mail, postage prepaid, return receipt requested, to the
Borrower’s, endorser’s or guarantor’s address shown below or as notified to the Bank and (ii) by
serving the same upon the Borrower(s), endorser(s) or guarantor(s) in any other manner otherwise
permitted by law, and agrees that such service shall in every respect be deemed effective service
upon the Borrower or such endorser or guarantor.

THE BORROWER AND EACH ENDORSER AND GUARANTOR ACKNOWLEDGE THAT THIS NOTE IS A DEMAND NOTE AND
THE RIGHT OF THE BANK TO DEMAND PAYMENT OF THIS NOTE IN WHOLE OR IN PART AT ANY TIME SHALL BE
ABSOLUTE, UNCONDITIONAL AND IN THE SOLE DISCRETION OF THE BANK. THE INCLUSION OF EVENTS OF DEFAULT
AND COVENANTS IN ANY LOAN DOCUMENTS BETWEEN THE BANK AND THE BORROWER OR ANY ENDORSER OR GUARANTOR
OTHER PARTY DELIVERED IN CONNECTION WITH THIS NOTE OR OTHERWISE SHALL NOT IN ANY WAY LIMIT THE
DEMAND NATURE OF THIS NOTE AND THE BANK MAY MAKE DEMAND FOR PAYMENT AT ANY TIME FOR ANY OR NO
REASON, WHETHER OR NOT AN EVENT OF DEFAULT HAS OCCURRED UNDER ANY SUCH LOAN DOCUMENTS.

THE BORROWER, EACH ENDORSER AND GUARANTOR AND THE BANK EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY, AND AFTER AN OPPORTUNITY TO CONSULT WITH LEGAL COUNSEL, (A) WAIVES ANY AND ALL
RIGHTS TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING IN CONNECTION WITH THIS NOTE, ANY OF THE
OBLIGATIONS OF THE BORROWER, EACH ENDORSER AND GUARANTOR TO THE BANK, AND ALL MATTERS CONTEMPLATED
HEREBY AND DOCUMENTS EXECUTED IN CONNECTION HEREWITH AND (B) AGREES NOT TO SEEK TO CONSOLIDATE ANY
SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CAN NOT BE, OR HAS NOT BEEN, WAIVED. THE
BORROWER, EACH ENDORSER AND GUARANTOR AND THE BANK EACH CERTIFIES THAT NEITHER THE BANK NOR ANY OF
ITS REPRESENTATIVES, AGENTS OR COUNSEL HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE BANK
WOULD NOT IN THE EVENT OF ANY SUCH PROCEEDING SEEK TO ENFORCE THIS WAIVER OF RIGHT TO TRIAL BY
JURY.

 

5

 

CONFESSION OF JUDGMENT

THE TERMS OF THIS NOTE INCLUDE A WARRANT OF ATTORNEY TO CONFESS JUDGMENT AND HAVE BEEN
NEGOTIATED AND AGREED UPON IN A COMMERCIAL CONTEXT. BORROWER HAS FULLY REVIEWED THE WARRANT OF
ATTORNEY TO CONFESS JUDGMENT WITH ITS OWN COUNSEL, AND IS KNOWINGLY AND VOLUNTARILY WAIVING CERTAIN
RIGHTS IT WOULD OTHERWISE POSSESS, INCLUDING, BUT NOT LIMITED TO, THE RIGHT TO ANY NOTICE OF A
HEARING PRIOR TO THE ENTRY OF JUDGMENT BY THE BANK PURSUANT TO THE FOREGOING WARRANT.

Executed as an instrument under seal as of Dec 13, 2010.

	 	 	 	 	 
	 	Borrower:

Orbit/FR, Inc.

 	 
	 	By:  	/s/ Relland Winand
 	 
	 	 	Relland Winand, CFO 	 
	 	 	 
	 	By:  	                                        /s/ Per Iversen
 	 
	 	 	Per Iversen,  President & CEO 	 
	 	 	 	 
	 	506 Prudential
Road 
Horsham, Pennsylvania 
19044

Borrower:

Advanced ElectroMagnetics, Inc.

 	 
	 	By:  	/s/ Relland Winand
 	 
	 	 	Relland Winand, CFO 	 
	 	 	 
	 	By:  	    /s/                                    Per Iversen
 	 
	 	 	Per Iversen, President & CEO 	 
	 	
9311 Stevens Rd.

San Tee, CA
 92071 	 

 

6

 

	 	 	 	 	 
	 	Borrower:

Orbit Advanced Technologies, Inc.

 	 
	 	By:  	/s/ Relland Winand
 	 
	 	 	Relland Winand, CFO 	 
	 	 	 	 
	 	By:  	/s/                           Per Iversen
 	 
	 	 	Per Iversen, President & CEO 	 
	 	 	 	 
	 	506 Prudential Road
 Horsham, Pennsylvania
 19044

Borrower:

Flam & Russell, lnc.

 	 
	 	By:  	/s/ Relland Winand
 	 
	 	 	Relland Winand, CFO 	 
	 	 	 
	 	By:  	/s/ Per Iversen
 	 
	 	 	Per Iversen, President & CEO 	 
	 	
506 Prudential Road
 Horsham, Pennsylvania
 19044 	 

 

7Exhibit 10.7

Exhibit 10.7

LOAN AGREEMENT

This LOAN AGREEMENT (this “Agreement”) is entered into at Pittsburgh, Pennsylvania, as of
December 13, 2010, between Orbit/FR, Inc., a Delaware corporation, with an address of
506 Prudential Road, Horsham Pennsylvania 19044, Advanced ElectroMagnetics, Inc., a California
corporation, with an address of 9311 Stevens Road San Tee, CA 92071, Orbit Advanced Technologies,
Inc., a Delaware corporation, with an address of 506 Prudential Road, Horsham Pennsylvania 19044
and Flam & Russell, Inc., a Delaware corporation, with an address of 506 Prudential Road, Horsham
Pennsylvania 19044 (collectively, the “Borrower” and each a “Borrower”) and Citizens Bank of
Pennsylvania, a Pennsylvania, state-chartered bank, with an address of 525 William Penn Place,
Pittsburgh, Pennsylvania 15219-1724 (the “Bank”).

FOR VALUE RECEIVED, and in consideration of the granting by the Bank of financial
accommodations to or for the benefit of the Borrowers, including without limitation respecting
the Obligations (as hereinafter defined), each Borrower represents to and agrees with the Bank,
as of the date hereof and as of the date of each loan, credit and/or other financial
accommodation as follows:

1. THE LOAN

1.1 Loan. The Bank agrees, subject to the terms and conditions set forth herein, to
establish an equipment acquisition line of credit (the “Equipment Line”) for the Orbit/FR, Inc.,
Advanced ElectroMagnetics, Inc., Orbit Advanced Technologies, Inc. and Flam & Russell, Inc.
pursuant to which the Bank agrees to lend to the Orbit/FR, Inc., Advanced ElectroMagnetics, Inc.,
Orbit Advanced Technologies, Inc. and Flam & Russell, Inc. upon any Borrower’s request up to Two
Hundred Fifty Thousand Dollars and Zero Cents ($250,000.00) (the “Line Loan Amount”), provided
there is no continuing uncured Event of Default (as hereinafter defined) and subject to the terms
and conditions set forth herein, for the purpose of enabling each Borrower to purchase equipment
(the “Purchased Equipment”) for use in each such Borrower’s current line of business. The Equipment
Line shall be evidenced by that certain Term Note-Non Revolving- Line of Credit, of even date
herewith (the “Equipment Note”), by Orbit/FR, Inc., Advanced ElectroMagnetics, Inc., Orbit Advanced
Technologies, Inc. and Flam & Russell, Inc. in favor of the Bank in the face amount of the Line
Loan Amount. Each advance shall be limited to a maximum of 100% of the Hard Costs (as hereinafter
defined) of the applicable item of Purchased Equipment. Hard Costs shall mean the invoice price of
such Purchased Equipment less delivery and installation costs and taxes. Each request for financing
will be reviewed by the Bank along with all invoices or other evidence acceptable to the Bank,
indicating the purchase, delivery and acceptance of such Purchased Equipment, and all advances
shall be approved by the Bank in its sole discretion. Advances may be made respecting this line of
credit from time to time from the date of this Agreement up to and
including 12/13, 2011. This
Agreement, the Equipment Note, and any and all other documents, amendments or renewals executed and
delivered in connection with any of the foregoing are collectively hereinafter referred to as the
“Loan Documents”.

 

 

 

1.2 Definitions. The following definitions shall apply:

	 	(a)	 	“Bank Affiliate” shall mean any “Affiliate” of the Bank or any lender acting as a
participant under any loan arrangement between the Bank and the Borrower(s). The term
“Affiliate” shall mean with respect to any person, (a) any person which, directly or
indirectly through one or
more intermediaries controls, or is controlled by, or is under common control with, such
person, or (b) any person who is a director or officer (i) of such person, (ii) of any
subsidiary of such person, or (iii) any person described in clause (a) above. For
purposes of this definition, control of a person shall mean the power, direct or
indirect, (x) to vote 5% or more of the Capital Stock having ordinary voting power for
the election of directors (or comparable equivalent) of such person, or (y) to direct or
cause the direction of the management and policies of such person whether by contract or
otherwise. Control may be by ownership, contract, or otherwise.

	 
	 	(b)	 	“Code” shall mean the Pennsylvania Uniform Commercial Code, Title 13 PaCSA as amended
from time to time.

	 
	 	(c)	 	“Obligation(s)” shall mean, without limitation, all loans, advances, indebtedness,
notes, liabilities, rate swap transactions, basis swaps, forward rate transactions,
commodity swaps, commodity options, equity or equity index swaps, equity or equity index
options, bond options, interest rate options, foreign exchange transactions, cap
transactions, floor transactions, collar transactions, forward transactions, currency swap
transactions, cross-currency rate swap transactions, currency options and amounts,
liquidated or unliquidated, owing by any Borrower to the Bank or any Bank Affiliate at any
time, of each and every kind, nature and description, whether arising under this Agreement
or otherwise, and whether secured or unsecured, direct or indirect (that is, whether the
same are due directly by any Borrower to the Bank or any Bank Affiliate; or are due
indirectly by any Borrower to the Bank or any Bank Affiliate as endorser, guarantor or
other surety, or as borrower of obligations due third persons which have been endorsed or
assigned to the Bank or any Bank Affiliate, or otherwise), absolute or contingent, due or
to become due, now existing or hereafter arising or contracted, including, without
limitation, payment when due of all amounts outstanding respecting any of the Loan
Documents. Said term shall also include all interest and other charges chargeable to any
Borrower or due from any Borrower to the Bank or any Bank Affiliate from time to time and
all costs and expenses referred to in this Agreement.

	 
	 	(d)	 	“Person” or “party” shall mean individuals, partnerships, corporations, limited
liability companies and all other entities.

All words and terms used in this Agreement other than those specifically defined herein shall
have the meanings accorded to them in the Code.

2. REPRESENTATIONS AND WARRANTIES

2.1 Organization and Qualification. Each Borrower that is not an individual, represents and
warrants that: (i) it is duly formed and validly existing under the laws of the state of its
formation, (ii) its exact legal name is set forth in the first paragraph of this Agreement; (iii)
it is in good standing under the laws of said state; (iv) it has the power to own its property and
conduct its business as now conducted and as currently proposed to be conducted, and; (v) it is
duly qualified to do business under the laws of each state where the nature of the business done or
property owned requires such qualification.

2.2 Related Parties. Each Borrower has no interest in any entities other than as previously
specifically consented to in writing by the Bank, if any, and each Borrower has never consolidated,
merged or acquired substantially all of the assets of any other entity or person other than as
previously specifically consented to in writing by the Bank, if any.

2.3 Partnership Records. In the event that a Borrower is a partnership, its Partnership
Agreement and all amendments thereto have been duly filed (if required) and are in proper order.
All outstanding limited partnership interests issued by such Borrower were and are properly issued
and all books and records of such Borrower, including but not limited to its minute books and books
of account, are accurate and up to date and will be so maintained.

 

2

 

2.4 Corporate Records. In the event that a Borrower is a corporation, its corporate
charter, articles or certificate of organization or incorporation and all amendments thereto have
been duly filed and are in proper order. All outstanding capital stock issued by such Borrower was
and is properly issued and all books and records of such Borrower, including but not limited to its
minute books, bylaws and books of account, are accurate and up to date and will be so maintained.

2.5 Trust Records. In the event that a Borrower is a trust, its Declaration of Trust or
Trust Indenture or other charter document and all amendments thereto are in proper order. All
beneficial interests in such Borrower were and are properly issued and all books and records of
such Borrower, including but not limited to its books of account, are accurate and up to date and
will be so maintained.

2.6 Limited Liability Company Records. In the event that a Borrower is a limited liability
company, its certificate of organization, articles of organization or other charter document and
all amendments thereto have been duly filed and are in proper order. All members of such Borrower
are properly reflected on all books and records of such Borrower, including but not limited to its
operating agreement, minute books, bylaws and books of account, all of which are accurate and up to
date and will be so maintained.

2.7 Title to Properties; Absence of Liens. Each Borrower has good and clear record and
marketable title to all of its properties and assets, and all of its properties and assets are free
and clear of all mortgages, liens, pledges, charges, encumbrances and setoffs, except those
mortgages, deeds of trust, leases of personal property and security interests previously
specifically consented to in writing by the Bank.

2.8 Places of Business. Each Borrower’s chief executive office is correctly stated in the
preamble to this Agreement, and each Borrower shall, during the term of this Agreement, keep the
Bank currently and accurately informed in writing of each of its other places of business, and
shall not change the location of such chief executive office or open or close, move or change any
existing or new place of business without giving the Bank at least thirty (30) days prior written
notice thereof.

2.9 Valid Obligations. The execution, delivery and performance of the Loan Documents have
been duly authorized by all necessary actions of each Borrower and each Loan Document represents a
legal, valid and binding obligation of each Borrower and is fully enforceable according to its
terms, except as limited by laws relating to the enforcement of creditors’ rights.

2.10 Conflicts. There is no provision in any Borrower’s organizational or charter
documents, if any, or in any indenture, contract or agreement to which any Borrower is a party
which prohibits, limits or restricts the execution, delivery or performance of the Loan Documents.

2.11 Governmental Approvals. The execution, delivery and performance of the Loan Documents
does not require any approval of or filing with any governmental agency or authority.

2.12 Litigation, etc. There are no actions, claims or proceedings pending or to the
knowledge of any Borrower threatened against any Borrower which might materially adversely affect
the ability of any Borrower to conduct its business or to pay or perform the Obligations.

2.13 Taxes. Each Borrower has filed all Federal, state and other tax returns required to be
filed (except for such returns for which current and valid extensions have been filed), and all
taxes, assessments and other governmental charges due from each Borrower have been fully paid. Each
Borrower has established on its books reserves adequate for the payment of all Federal, state and
other tax liabilities (if any).

 

3

 

2.14 Use of Proceeds. No portion of any loan is to be used for (i) the purpose of
purchasing or carrying any “margin security” or “margin stock” as such terms are used in
Regulations U and X of the
Board of Governors of the Federal Reserve System, 12 C.F.R. 221 and 224 or (ii) primarily
personal, family or household purposes.

2.15 Environmental. As of the date hereof none of any Borrowers nor any of their agents,
employees or independent contractors (1) have caused or are aware of a release or threat of release
of Hazardous Materials (as defined herein) on any of the premises or personal property owned or
controlled by any Borrower (“Controlled Property”) or any property abutting Controlled Property
(“Abutting Property”), which could give rise to liability under any Environmental Law (as defined
herein) or any other Federal, state or local law, rule or regulation; (2) have arranged for the
transport of or transported any Hazardous Materials in a manner as to violate, or result in
potential liabilities under, any Environmental Law; (3) have received any notice, order or demand
from the Environmental Protection Agency or any other Federal, state or local agency under any
Environmental Law; (4) have incurred any liability under any Environmental Law in connection with
the mismanagement, improper disposal or release of Hazardous Materials; or (5) are aware of any
inspection or investigation of any Controlled Property or Abutting Property by any Federal, state
or local agency for possible violations of any Environmental Law.

To the best of each Borrower’s knowledge, neither any Borrower, nor any prior owner or tenant
of any Controlled Property, committed or omitted any act which caused the release of Hazardous
Materials on such Controlled Property which could give rise to a lien thereon by any Federal,
state or local government. No notice or statement of claim or lien affecting any Controlled
Property has been recorded or filed in any public records by any Federal, state or local
government for costs, penalties, fines or other charges as to such property. All notices, permits,
licenses or similar authorizations, if any, required to be obtained or filed in connection with
the ownership, operation, or use of the Controlled Property, including without limitation, the
past or present generation, treatment, storage, disposal or release of any Hazardous Materials
into the environment, have been duly obtained or filed.

Each Borrower agrees to indemnify and hold the Bank and any Bank Affiliate harmless from all
liability, loss, cost, damage and expense, including attorney fees and costs of litigation,
arising from any and all of its violations of any Environmental Law (including those arising from
any lien by any Federal, state or local government arising from the presence of Hazardous
Materials) or from the presence of Hazardous Materials located on or emanating from any Controlled
Property or Abutting Property whether existing or not existing and whether known or unknown at the
time of the execution hereof and regardless of whether or not caused by, or within the control of
any Borrower. Each Borrower further agrees to reimburse Bank upon demand for any costs incurred by
Bank in connection with the foregoing. Each Borrower agrees that its obligations hereunder shall
be continuous and shall survive the repayment of all debts to Bank and shall continue so long as a
valid claim may be lawfully asserted against the Bank.

The term “Hazardous Materials” includes but is not limited to any and all substances (whether
solid, liquid or gas) defined, listed, or otherwise classified as pollutants, hazardous wastes,
hazardous substances, hazardous materials, extremely hazardous wastes, or words of similar meaning
or regulatory effect under any present or future Environmental Law or that may have a negative
impact on human health or the environment, including but not limited to petroleum and petroleum
products, asbestos and asbestos-containing materials, polychlorinated biphenyls, lead, radon,
radioactive materials, flammables and explosives.

The term “Environmental Law” means any present and future Federal, state and local laws,
statutes, ordinances, rules, regulations and the like, as well as common law, relating to
protection of human health or the environment, relating to Hazardous Materials, relating to
liability for or costs of remediation or prevention of releases of Hazardous Materials or relating
to liability for or costs of other actual or threatened danger to human health or the environment.
The term “Environmental Law” includes, but is not limited to, the following statutes, as amended,
any successor thereto, and any regulations promulgated pursuant thereto, and any state or local
statutes, ordinances, rules, regulations and the like addressing similar issues: the Comprehensive
Environmental Response, Compensation and Liability Act; the Emergency Planning and Community
Right-to-Know Act; the Hazardous Materials Transportation Act; the Resource Conservation and
Recovery Act (including but not limited to Subtitle I relating to underground storage tanks); the
Solid Waste
Disposal Act; the Clean Water Act; the Clean Air Act; the Toxic
Substances Control Act; the Safe
Drinking Water Act; the Occupational Safety and Health Act; the
Federal Water Pollution Control
Act; the Federal Insecticide, Fungicide and Rodenticide Act; the Endangered Species Act; the
National Environmental Policy Act; the River and Harbors Appropriation Act; and 35 PaCSA Chapter
29J.

 

4

 

3. AFFIRMATIVE COVENANTS

3.1 Payments and Performance. Each Borrower will duly and punctually pay all Obligations
becoming due to the Bank and will duly and punctually perform all Obligations on its part to be
done or performed under this Agreement.

3.2
Books and Records; Inspection. Each Borrower will at all times keep proper books of
account in which full, true and correct entries will be made of its transactions in accordance with
generally accepted accounting principles, consistently applied and which are, in the opinion of a
Certified Public Accountant acceptable to Bank, adequate to determine fairly the financial
condition and the results of operations of such Borrower. Each
Borrower will at all reasonable
times make its books and records available in its offices for inspection, examination and
duplication by the Bank and the Bank’s representatives and will permit inspection of all of its
properties by the Bank and the Bank’s representatives. Each Borrower will from time to time furnish
the Bank with such information and statements as the Bank may request in its sole discretion with
respect to the Obligations.

3.3 Financial Statements. Each Borrower will furnish to Bank:

	 	(a)	 	as soon as available to such Borrower, but in any event within 60 days after the close of
each quarterly period of its fiscal year, a full and complete signed copy of financial
statements, on a consolidated and consolidating basis with Orbit/FR, Inc., Advanced
Electromagnetics, Inc., Orbit Advanced Technologies, Inc. and Flam & Russell, Inc., which
shall include a balance sheet of Orbit/FR, Inc., Advanced Electromagnetics, Inc., Orbit
Advanced Technologies, Inc. and Flam & Russell, Inc., as at the end of such quarter, and
statement of profit and loss of Orbit/FR, Inc., Advanced Electromagnetics, Inc., Orbit
Advanced Technologies, Inc. and Flam & Russell, Inc., reflecting the results of their
operations during such quarter and shall be prepared by Orbit/FR, Inc., Advanced
Electromagnetics, Inc., Orbit Advanced Technologies, inc. and Flam & Russell, Inc., and
certified by such Borrower’s chief financial officer as to correctness in accordance with
generally accepted accounting principles, consistently applied, subject to year-end
adjustments;

	 
	 	(b)	 	as soon as available to such Borrower, but in any event within 120 days after the close
of each fiscal year, a full and complete signed copy of audited financial statements,
prepared by certified public accountants acceptable to Bank, on a consolidated and
consolidating basis with Orbit/FR, Inc., Advanced Electromagnetics, Inc., Orbit Advanced
Technologies, Inc. and Flam & Russell, Inc.,, which shall include a balance sheet of
Orbit/FR, Inc., Advanced Electromagnetics, Inc., Orbit Advanced Technologies, Inc. and Flam
& Russell, Inc.,, as at the end of such year, statement of cash flows and statement of
profit and loss of Orbit/FR, Inc., Advanced Electromagnetics, Inc., Orbit Advanced
Technologies, Inc. and Flam & Russell, Inc., reflecting the results of its operations during
such year, bearing the opinion of such certified public accountants and prepared on an
audited basis in accordance with generally accepted accounting principles, consistently
applied together with any so-called management letter;

	 
	 	(c)	 	within 30 days after the close of each quarterly fiscal period of such Borrower, an
Accounts Receivable aging report in form satisfactory to Bank showing the total amount due
from each account debtor, the month in which each Account Receivable was created, as well as
an accounts payable aging report and such other information as Bank shall request;

 

5

 

	 	(d)	 	as soon as available to such Borrower, but in any event within 120 days after the
close of each annual period of its fiscal year, a full and complete signed copy of
financial statements, on a consolidated and consolidating basis with Orbit/FR, Inc.,
Advanced Electromagnetics, Inc., Orbit Advanced Technologies, Inc. and Flam & Russell,
Inc., which shall include a balance sheet of Orbit/FR, Inc., Advanced Electromagnetics,
Inc., Orbit Advanced Technologies, Inc. and Flam & Russell, Inc., as at the end of such
quarter, and statement of profit and loss of Orbit/FR, Inc., Advanced Electromagnetics,
Inc., Orbit Advanced Technologies, Inc. and Flam & Russell, Inc., reflecting the results
of their operations during such quarter and shall be prepared by Orbit/FR, Inc.,
Advanced Electromagnetics, Inc., Orbit Advanced Technologies, Inc. and Flam & Russell,
Inc., and certified by such Borrower’s chief financial officer as to correctness in
accordance with generally accepted accounting principles, consistently applied, subject
to year-end adjustments;

	 
	 	(e)	 	from time to time, such consolidated and consolidating financial data and information
about each Borrower as Bank may reasonably request; and

	 
	 	(f)	 	any financial data and information about any guarantors of the Obligations as Bank may
reasonably request.

3.4 Conduct of Business. Each Borrower will maintain its existence in good standing and
comply with all laws and regulations of the United States and of any state or states thereof and of
any political subdivision thereof, and of any governmental authority which may be applicable to it
or to its business; provided that this covenant shall not apply to any tax, assessment or charge
which is being contested in good faith and with respect to which reserves have been established and
are being maintained.

3.5 Contact with Accountant. Each Borrower hereby authorizes the Bank to directly contact
and communicate with any accountant employed by any Borrower in connection with the review and/or
maintenance of any Borrower’s books and records or preparation of any financial reports delivered
by or at the request of any Borrower to Bank.

3.6 Operating and Deposit Accounts. Each Borrower shall maintain with the Bank its primary
operating and deposit accounts. At the option of the Bank, all loan payments and fees will
automatically be debited from any Borrower’s primary operating account and all advances will
automatically be credited to any Borrower’s primary operating account.

3.7 Taxes. Each Borrower will promptly pay all real and personal property taxes,
assessments and charges and all franchise, income, unemployment, retirement benefits, withholding,
sales and other taxes assessed against it or payable by it before delinquent; provided that this
covenant shall not apply to any tax assessment or charge which is being contested in good faith and
with respect to which reserves have been established and are being maintained.

3.8 Maintenance. Each Borrower will keep and maintain its properties, if any, in good
repair, working order and condition. Each Borrower will immediately notify the Bank of any loss or
damage to or any occurrence which would adversely affect the value of any such property.

3.9 Insurance. Each Borrower will maintain in force property and casualty insurance on any
property of such Borrower, if any, against risks customarily insured against by companies engaged
in businesses similar to that of such Borrower containing such terms and written by such companies
as may be satisfactory to the Bank, such insurance to be payable to the Bank as its interest may
appear in the event of loss and to name the Bank as insured pursuant to a standard loss payee
clause; no loss shall be adjusted thereunder without the Bank’s approval; and all such policies
shall provide that they may not be canceled without first giving at least Ten (10) days written
notice of cancellation to the Bank. In the event that any Borrower fails to provide evidence of
such insurance, the Bank may, at its option, secure such
insurance and charge the cost thereof to such Borrower. At the option of the Bank, all insurance
proceeds received from any loss or damage to any property shall be applied either to the
replacement or repair thereof or as a payment on account of the Obligations. From and after the
occurrence of an Event of Default, the Bank is authorized to cancel any insurance maintained
hereunder and apply any returned or unearned premiums, all of which are hereby assigned to the
Bank, as a payment on account of the Obligations.

 

6

 

3.10 Notification of Default. Immediately upon becoming aware of the existence of any
condition or event which constitutes an Event of Default, or any condition or event which would
upon notice or lapse of time, or both, constitute an Event of Default, each Borrower shall give
Bank written notice thereof specifying the nature and duration thereof and the action being or
proposed to be taken with respect thereto.

3.11 Notification of Material Litigation. Each Borrower will immediately notify the Bank in
writing of any litigation or of any investigative proceedings of a governmental agency or authority
commenced or threatened against it which would or might be materially adverse to the financial
condition of any Borrower or any guarantor of the Obligations.

Pension Plans. With respect to any pension or benefit plan maintained by any
Borrower, or to which any Borrower contributes (“Plan”), the benefits under which are guarantied,
in whole or in part, by the Pension Benefit Guaranty Corporation created by the Employee
Retirement Income Security Act of 1974, P.L. 93-406, as amended (“ERISA”) or any governmental
authority succeeding to any or all of the functions of the Pension Benefit Guaranty Corporation
(“Pension Benefit Guaranty Corporation”), such Borrower will (a) fund each Plan as required by the
provisions of Section 412 of the Internal Revenue Code of 1986, as amended; (b) cause each Plan to
pay all benefits when due; (c) furnish Bank (i) promptly with a copy of any notice of each Plan’s
termination sent to the Pension Benefit Guaranty Corporation (ii) no later than the date of
submission to the Department of Labor or to the Internal Revenue Service, as the case may be, a
copy of any request for waiver from the funding standards or extension of the amortization periods
required by Section 412 of the Internal Revenue Code of 1986, as amended and (iii) notice of any
Reportable Event as such term is defined in ERISA; and (d) subscribe to any contingent liability
insurance provided by the Pension Benefit Guaranty Corporation to protect against employer
liability upon termination of a guarantied pension plan, if available to such Borrower.

3.12 Special Conditions

(a) Citizens Bank must be notified within 30 days if Satimo Industries, SA or Microwave
Vision, SA sells 10% or more of ORBIT/FR, Inc’s shares of common stock.

(b) Borrowers are not to advance funds (loans, advances, profits, cost sharing/subsidizing,
etc) to its parent companies (Microwave Vision &/or its subsidiaries, including Satimo) and/or
foreign subsidiaries, except for reasonable payments for services provided under the “Assistance
and Provision of Services Agreement” with Microwave Vision and its subsidiaries (including Satimo),
the management fee (1% of gross sales) paid to Microwave Vision, and/or payments for transactions
with its foreign subsidiaries conducted within the ordinary course of business at rates/amounts
considered reasonable for general market conditions.

(c) Borrowers are not to guaranty any debt of its parent companies and/or foreign
subsidiaries, except for the current guaranty maintained for existing credit arrangements ($500M
line of credit & $3MM letter of credit facility) for Orbit/FR Engineering, LTD.

(d) ELOC must be used to purchase equipment to be used in U.S.

 

7

 

4. NEGATIVE COVENANTS

4.1 Limitations on Indebtedness. Each Borrower shall not issue any evidence of indebtedness
or create, assume, guarantee, become contingently liable for, or suffer to exist indebtedness in
addition to indebtedness to the Bank, except indebtedness or liabilities of such Borrower, other
than for money borrowed, incurred or arising in the ordinary course of business.

4.2 Sale of Interest. There shall not be any sale or transfer of ownership of any interest
in any Borrower that is not an individual without the Bank’s prior written consent.

4.3 Loans or Advances. Each Borrower shall not make any loans or advances to any
individual, partnership, corporation, limited liability company, trust, or other organization or
person, including without limitation its officers, members and employees; provided, however, that
each Borrower may make advances to its employees, including its officers, with respect to expenses
incurred or to be incurred by such employees in the ordinary course of business which expenses are
reimbursable by such Borrower; and provided further, however, that each Borrower may extend credit
in the ordinary course of business in accordance with customary trade practices.

4.4 Dividends and Distributions. If any Borrower is a corporation, such Borrower shall not,
without prior written consent of the Bank, pay any dividends on or make any distribution on account
of any class of such Borrower’s capital stock in cash or in property (other than additional shares
of such stock), or redeem, purchase or otherwise acquire, directly or indirectly, any of such
stock, except, so long as such Borrower is not in default hereunder, if such Borrower is a
Subchapter S corporation, under the regulations of the Internal Revenue Service of the United
States, distributions to the stockholders of such Borrower in such amounts as are necessary to pay
the tax liability of such stockholders due as a result of such stockholders’ interest in such
Borrower. If any Borrower is a partnership, such Borrower shall not, without prior written
permission of the Bank, make any distribution to any of such Borrower’s partners in cash or in
property or redeem, purchase or otherwise acquire, directly or indirectly, any partnership
interests. If any Borrower is a limited liability company, such Borrower shall not, without prior
written permission of the Bank, make any distribution to any of such Borrower’s beneficiaries in
cash or in property or redeem, purchase or otherwise acquire, directly or indirectly, any
beneficial interests. If any Borrower is a trust, such Borrower shall not, without prior written
permission of the Bank, make any distribution to any of such Borrower’s beneficiaries in cash or in
property or redeem, purchase or otherwise acquire, directly or indirectly, any beneficial
interests. If any Borrower is an association, such Borrower shall not, without prior written
permission of the Bank, make any distribution to any of such Borrower’s members in cash or in
property or redeem, purchase or otherwise acquire, directly or indirectly, any member interests.

4.5 Investments. Each Borrower shall not make investments in, or advances to, any
individual, partnership, corporation, limited liability company, trust or other organization or
person other than as previously specifically consented to in writing by the Bank. Each Borrower
will not purchase or otherwise invest in or hold securities, nonoperating real estate or other
nonoperating assets or purchase all or substantially all the assets of any entity other than as
previously specifically consented to in writing by the Bank.

4.6
Merger. Each Borrower that is not an individual shall not merge or consolidate or be
merged or consolidated with or into any other entity.

4.7 Capital Expenditures. Each Borrower shall not, directly or indirectly, make or commit
to make capital expenditures by lease, purchase, or otherwise, except in the ordinary and usual
course of business for the purpose of replacing machinery, equipment or other personal property
which, as a consequence of wear, duplication or obsolescence, is no longer used or necessary in
such Borrower’s business.

 

8

 

4.8 Sale of Assets. Each Borrower shall not sell, lease or otherwise dispose of any of its
assets, except in the ordinary and usual course of business and except for the purpose of replacing
machinery, equipment or other personal property which, as a consequence of wear, duplication or
obsolescence, is no longer used or necessary in such Borrower’s business, provided that fair
consideration is received therefor; provided, however, in no event shall any Borrower sell, lease
or otherwise dispose of any equipment purchased with the proceeds of any loans made by the Bank.

4.9 Restriction on Liens. Each Borrower shall not grant any security interest in, or
mortgage of, any of its properties or assets. Each Borrower shall not enter into any agreement with
any person other than the Bank that prohibits the Borrower from granting any security interest in,
or mortgage of, any of its properties or assets.

4.10 Other Business. Each Borrower shall not engage in any business other than the business
in which it is currently engaged or a business reasonably allied thereto.

4.11 Change of Name, etc. Each Borrower shall not change its legal name or the State or the
type of its organization, without giving the Bank at least 30 days prior written notice thereof.

4.12 Negative Pledge. The Borrower will not grant a security interest in US assets to
another lender.

5. DEFAULT

5.1 Default. “Event of Default” shall mean the occurrence of one or more of any of the
following events:

	 	(a)	 	default of any liability, obligation, covenant or undertaking of any Borrower or any
guarantor of the Obligations to the Bank, hereunder or otherwise, including, without
limitation, failure to pay in full and when due any installment of principal or interest or
default of any Borrower or any guarantor of the Obligations under any other Loan Document or
any other agreement with the Bank;

	 
	 	(b)	 	failure of any Borrower or any guarantor of the Obligations to maintain aggregate
collateral security value satisfactory to the Bank;

	 
	 	(c)	 	default of any material liability, obligation or undertaking of any Borrower or any
guarantor of the Obligations to any other party;

	 
	 	(d)	 	if any statement, representation or warranty heretofore, now or hereafter made by any
Borrower or any guarantor of the Obligations in connection with this Agreement or in any
supporting financial statement of any Borrower or any guarantor of the Obligations shall be
determined by the Bank to have been false or misleading in any material respect when made;

	 
	 	(e)	 	if any Borrower or any guarantor of the Obligations is a corporation, trust, partnership
or limited liability company, the liquidation, termination or dissolution of any such
organization, or the merger or consolidation of such organization into another entity, or
its ceasing to carry on actively its present business or the appointment of a receiver for
its property;

	 
	 	(f)	 	the death of any Borrower or any guarantor of the Obligations and, if any Borrower or any
guarantor of the Obligations is a partnership or limited liability company, the death of any
partner or member;

	 
	 	(g)	 	the institution by or against any Borrower or any guarantor of the Obligations of any
proceedings under the Bankruptcy Code 11 USC §101 et seq. or any other law in which any
Borrower or any guarantor of the Obligations is alleged to be insolvent or unable to pay its
debts as they mature, or the making by any Borrower or any guarantor of the Obligations
of an assignment for the benefit of creditors or the granting by any Borrower or any
guarantor of the Obligations of a trust mortgage for the benefit of creditors;

 

9

 

	 	(h)	 	the service upon the Bank of a writ in which the Bank is named as trustee of any
Borrower or any guarantor of the Obligations;

	 
	 	(i)	 	a judgment or judgments for the payment of money shall be rendered against any
Borrower or any guarantor of the Obligations, and any such judgment shall remain
unsatisfied and in effect for any period of thirty (30) consecutive days without a stay of
execution;

	 
	 	(j)	 	any levy, lien (including mechanics lien), seizure, attachment, execution or similar
process shall be issued or levied on any of the property of any Borrower or any guarantor
of the Obligations;

	 
	 	(k)	 	the termination or revocation of any guaranty of the Obligations; or

	 
	 	(l)	 	the occurrence of such a change in the condition or affairs (financial or otherwise)
of any Borrower or any guarantor of the Obligations, or the occurrence of any other event
or circumstance, such that the Bank, in its sole discretion, deems that it is insecure or
that the prospects for timely or full payment or performance of any obligation of any
Borrower or any guarantor of the Obligations to the Bank has been or may be impaired.

5.2 Acceleration. If an Event of Default shall occur, at the election of the Bank, all
Obligations shall become immediately due and payable without notice or demand, except with respect
to Obligations payable on DEMAND, which shall be due and payable on DEMAND, whether or not an Event
of Default has occurred.

5.3 Nonexclusive Remedies. All of the Bank’s rights and remedies not only under the
provisions of this Agreement but also under any other agreement or transaction shall be cumulative
and not alternative or exclusive, and may be exercised by the Bank at such time or times and in
such order of preference as the Bank in its sole discretion may determine.

6. MISCELLANEOUS

6.1 Waivers. Each Borrower waives notice of intent to accelerate, notice of acceleration,
notice of nonpayment, demand, presentment, protest or notice of protest of the Obligations, and all
other notices, consents to any renewals or extensions of time of payment thereof, and generally
waives any and all suretyship defenses and defenses in the nature thereof.

6.2 Waiver of Homestead. To the maximum extent permitted under applicable law, each
Borrower hereby waives and terminates any homestead rights and/or exemptions respecting any of its
property under the provisions of any applicable homestead laws, including without limitation, Title
42, Section 8123, of the Pennsylvania Consolidated Statutes Annotated.

6.3 Joint and Several. Each Borrower shall be jointly and severally liable for payment
and/or performance of all Obligations and the term “Borrower” shall include each as well as all of
them.

6.4 Deposit Collateral. Each Borrower hereby grants to the Bank a continuing lien and
security interest in any and all deposits or other sums at any time credited by or due from the
Bank or any Bank Affiliate to any Borrower and any cash, securities, instruments or other property
of any Borrower in the possession of the Bank or any Bank Affiliate, whether for safekeeping or
otherwise, or in transit to or from the Bank or any Bank Affiliate (regardless of the reason the
Bank or Bank Affiliate had received the same or whether the Bank or Bank Affiliate has
conditionally released the same) as security for the full and punctual payment and performance of
all of the liabilities and obligations of each Borrower to the Bank or any Bank
Affiliate and such deposits and other sums may be applied or set off against such liabilities and
obligations of any Borrower to the Bank or any Bank Affiliate at any time, whether or not such are
then due, whether or not demand has been made and whether or not other collateral is then
available to the Bank or any Bank
Affiliate.

 

10

 

6.5 Indemnification. Each Borrower shall indemnify, defend and hold the Bank and any Bank
Affiliate and their directors, officers, employees, agents and attorneys (each an “Indemnitee”)
harmless of and from any claim brought or threatened against any Indemnitee by any Borrower, any
guarantor or endorser of the Obligations, or any other person (as well as from reasonable
attorneys’ fees and expenses in connection therewith) on account of the Bank’s relationship with
any Borrower, or any guarantor or endorser of the Obligations (each of which may be defended,
compromised, settled or pursued by the Bank with counsel of the Bank’s election, but at the expense
of the Borrowers), except for any claim arising out of the gross negligence or willful misconduct
of the Bank. The within indemnification shall survive payment of the Obligations, and/or any
termination, release or discharge executed by the Bank in favor of any Borrower.

6.6 Costs and Expenses. Each Borrower shall pay to the Bank on demand any and all costs and
expenses (including, without limitation, reasonable attorneys’ fees and disbursements, court costs,
litigation and other expenses) incurred or paid by the Bank in establishing, maintaining,
protecting or enforcing any of the Bank’s rights or the Obligations, including, without limitation,
any and all such costs and expenses incurred or paid by the Bank in defending the Bank’s security
interest in, title or right to any collateral or in collecting or attempting to collect or
enforcing or attempting to enforce payment of any Obligation.

6.7 Counterparts. This Agreement may be executed in two or more counterparts, each of which
shall be an original, but all of which shall constitute but one agreement.

6.8 Severability. If any provision of this Agreement or portion of such provision or the
application thereof to any person or circumstance shall to any extent be held invalid or
unenforceable, the remainder of this Agreement (or the remainder of such provision) and the
application thereof to other persons or circumstances shall not be affected thereby.

6.9 Complete Agreement. This Agreement and the other Loan Documents constitute the entire
agreement and understanding between and among the parties hereto relating to the subject matter
hereof, and supersedes all prior proposals, negotiations, agreements and understandings among the
parties hereto with respect to such subject matter.

6.10 Binding Effect of Agreement. This Agreement shall be binding upon and inure to the
benefit of the respective heirs, executors, administrators, legal representatives, successors and
assigns of the parties hereto, and shall remain in full force and effect (and the Bank shall be
entitled to rely thereon) until released in writing by the Bank. The Bank may transfer and assign
this Agreement and deliver it to the assignee, who shall thereupon have all of the rights of the
Bank; and the Bank shall then be relieved and discharged of any responsibility or liability with
respect to this Agreement. Each Borrower may not assign or transfer any of its rights or
obligations under this Agreement. Except as expressly provided herein or in the other Loan
Documents, nothing, expressed or implied, is intended to confer upon any party, other than the
parties hereto, any rights, remedies, obligations or liabilities under or by reason of this
Agreement or the other Loan Documents.

6.11 Further Assurances. Each Borrower will from time to time execute and deliver to Bank
such documents, and take or cause to be taken, all such other or further action, as Bank may
request in order to effect and confirm or vest more securely in Bank all rights contemplated by
this Agreement and the other Loan Documents (including, without limitation, to correct clerical
errors) or to comply with applicable statute or law.

 

11

 

6.12 Amendments and Waivers. This Agreement may be amended and any Borrower may take any
action herein prohibited, or omit to perform any act herein required to be performed by it, if such
Borrower shall obtain the Bank’s prior written consent to each such amendment, action or omission
to act. No course of dealing and no delay or omission on the part of Bank in exercising any right
hereunder shall operate as a waiver of such right or any other right and waiver on any one or more
occasions shall not be construed as a bar to or waiver of any right or remedy of Bank on any future
occasion.

6.13 Terms of Agreement. This Agreement shall continue in full force and effect so long as
any Obligations or obligation of any Borrower to Bank shall be outstanding, or the Bank shall have
any obligation to extend any financial accommodation hereunder, and is supplementary to each and
every other agreement between any Borrower and Bank and shall not be so construed as to limit or
otherwise derogate from any of the rights or remedies of Bank or any of the liabilities,
obligations or undertakings of any Borrower under any such agreement, nor shall any contemporaneous
or subsequent agreement between any Borrower and the Bank be construed to limit or otherwise
derogate from any of the rights or remedies of Bank or any of the liabilities, obligations or
undertakings of any Borrower hereunder, unless such other agreement specifically refers to this
Agreement and expressly so provides.

6.14 Notices. Any notices under or pursuant to this Agreement shall be deemed duly received
and effective if delivered in hand to any officer or agent of any Borrower or Bank, or if mailed by
registered or certified mail, return receipt requested, addressed to any Borrower or Bank at the
address set forth in this Agreement or as any party may from time to time designate by written
notice to the other party.

6.15 Governing Law. This Agreement shall be governed by federal law applicable to the Bank
and, to the extent not preempted by federal law, the laws of the Commonwealth of Pennsylvania.

6.16 Reproductions. This Agreement and all documents which have been or may be hereinafter
furnished by any Borrower to the Bank may be reproduced by the Bank by any photographic,
photostatic, microfilm, xerographic or similar process, and any such reproduction shall be
admissible in evidence as the original itself in any judicial or administrative proceeding (whether
or not the original is in existence and whether or not such reproduction was made in the regular
course of business).

6.17 Jurisdiction and Venue. Each Borrower irrevocably submits to the nonexclusive
jurisdiction of any Federal or state court sitting in Pennsylvania, over any suit, action or
proceeding arising out of or relating to this Agreement. Each Borrower irrevocably waives, to the
fullest extent it may effectively do so under applicable law, any objection it may now or hereafter
have to the laying of the venue of any such suit, action or proceeding brought in any such court
and any claim that the same has been brought in an inconvenient forum. Each Borrower hereby
consents to any and all process which may be served in any such suit, action or proceeding, (i) by
mailing a copy thereof by registered and certified mail, postage prepaid, return receipt requested,
to such Borrower’s address shown in this Agreement or as notified to the Bank and (ii) by serving
the same upon such Borrower in any other manner otherwise permitted by law, and agrees that such
service shall in every respect be deemed effective service upon Borrower.

6.18 JURY WAIVER. EACH BORROWER AND BANK EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY, AND AFTER AN OPPORTUNITY TO CONSULT WITH LEGAL COUNSEL, (A) WAIVE ANY AND ALL RIGHTS
TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING IN CONNECTION WITH THIS AGREEMENT, THE OBLIGATIONS,
ALL MATTERS CONTEMPLATED HEREBY AND DOCUMENTS EXECUTED IN CONNECTION HEREWITH AND (B) AGREE NOT TO
SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE, OR HAS
NOT BEEN, WAIVED. EACH BORROWER CERTIFIES THAT NEITHER THE BANK NOR ANY OF ITS REPRESENTATIVES,
AGENTS OR COUNSEL HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE BANK WOULD NOT IN THE EVENT OF
ANY SUCH PROCEEDING SEEK TO ENFORCE THIS WAIVER OF RIGHT TO TRIAL BY JURY.

 

12

 

Executed
as an instrument under seal as of 12/13, 2010.

	 	 	 	 	 	 	 
	 	 	Borrower:	 	 
	 
	 	 	 	 	 	 
	 	 	Orbit/FR, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Relland Winand
 

Relland Winand, CFO
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Per Iversen
 

Per Iversen, President & CEO
	 	 

 

13

 

	 	 	 	 	 	 	 
	 	 	Borrower:	 	 
	 
	 	 	 	 	 	 
	 	 	Advanced ElectroMagnetics, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Relland Winand
 

Relland Winand, CFO
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Per Iversen
 

Per Iversen, President & CEO
	 	 
	 
	 	 	 	 	 	 
	 	 	Borrower:	 	 
	 
	 	 	 	 	 	 
	 	 	Orbit Advanced Technologies, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Relland Winand
 

Relland Winand, CFO
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Per Iversen
 

Per Iversen, President & CEO
	 	 
	 
	 	 	 	 	 	 
	 	 	Borrower:	 	 
	 
	 	 	 	 	 	 
	 	 	Flam & Russell, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Relland Winand
 

Relland Winand, CFO
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Per Iversen
 

Per Iversen, President & CEO
	 	 

Accepted: Citizens Bank of Pennsylvania

	 	 	 	 	 
	By:

	 	/s/ Christina Scott
 

Name: Christina Scott
	 	 
	 

	 	Title:    Vice President	 	 

	 	 	 
	 
	 	 
	

	 	© 2010 Medici, a division of Wolters Kluwer Financial Services

 

14

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00187-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00187-of-00352.parquet"}]]