Document:

Exhibit 10.1

THESE  SECURITIES HAVE NOT BEEN  REGISTERED  UNDER THE SECURITIES ACT OF 1933 OR
ANY STATE  SECURITIES  LAWS.  THEY MAY NOT BE SOLD OR  OFFERED  FOR SALE  EXCEPT
PURSUANT  TO  AN  EFFECTIVE  REGISTRATION  STATEMENT  UNDER  SAID  ACT  AND  ANY
APPLICABLE   STATE   SECURITIES  LAW  OR  AN  APPLICABLE   EXEMPTION  FROM  SUCH
REGISTRATION REQUIREMENTS.

                               SERIES B WARRANT

EXERCISABLE ON OR BEFORE OCTOBER 17, 2007

          VOID AFTER 5:00 P.M. NEW YORK CITY TIME ON OCTOBER 17, 2007

NO. W.   B1                                                 75,000      Shares
      ---------                                        ----------------

                WARRANTS TO PURCHASE SHARES OF COMMON STOCK OF
                          HEARTLAND TECHNOLOGY, INC.

            This  Warrant   Certificate   certifies  that  EDWIN  JACOBSON,   or
registered  assigns,  is the  registered  holder (the "Holder") of warrants (the
"Warrants")  to purchase  shares of Common  Stock,  par value $.01 (the  "Common
Stock"), of Heartland Technology,  Inc., a Delaware corporation (the "Company").
Each Warrant  entitles the holder to purchase from the Company at any time on or
before 5:00 p.m. New York City time on October 17, 2007 (the "Exercise  Period")
one fully  paid and  nonassessable  share of Common  Stock of the  Company at an
exercise  price of Four Dollars  ($4.00) per full share (the  "Exercise  Price")
upon surrender of this Warrant  Certificate and payment of the Exercise Price at
the office of the Company maintained for that purpose in Chicago,  Illinois,  or
elsewhere,  but only subject to the conditions set forth herein. As used herein,
"Shares"  refers to the Common Stock of the Company and, where  appropriate,  to
the other securities or property issuable upon exercise of a Warrant as provided
for herein upon the  happening of certain  events.  The  Exercise  Price and the
number of Shares  purchasable  upon  exercise  of the  Warrants  are  subject to
adjustment  upon the  occurrence  of  certain  events  as set  forth  below.  No
fractional  shares of Common Stock shall be issued upon exercise of any Warrant.
In lieu  thereof,  cash will be paid in an amount  equal to the  current  market
value of such fractional shares.

            1. Exercise  Period;  Exercise  Price.  Subject to and in compliance
with the terms hereof, the Holder hereof is entitled, at its option, at any time
and from time to time before the fourth  anniversary of the Disbursement Date to
exercise this Warrant  Certificate,  in whole or in part,  and purchase from the
Company one fully paid and non-assessable  share of Common Stock of the Company,
as said shares shall be  constituted  on the date of  exercise,  at the Exercise
Price, subject to adjustment as set forth below for each Warrant.

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            2.  Exercise.  In order to  exercise  a Warrant,  the  Holder  shall
surrender  the  Warrant to the  Company  on any  business  day at the  principal
business  office  maintained  by the Company in Chicago,  Illinois or such other
location  upon  notice to the  Holder,  accompanied  by the form of  election to
purchase  attached  hereto  duly  completed  and  signed  and by  payment of the
exercise  price.  Payment of the Exercise  Price shall be made in United  States
dollars in cash,  by certified or official bank check in  immediately  available
funds  payable to the order of the Company or by wire  transfer.  As promptly as
practicable (but in no event later than five (5) business days thereafter) after
the receipt of (a) the form of election to purchase,  (b) the Exercise Price and
(c) this Warrant as described above, the Company shall issue and deliver, at its
principal business office in Chicago,  Illinois or such other location, or cause
the Company's  transfer agent to issue and deliver at Harris Bank, a certificate
or certificates for the number of full shares of Common Stock issuable upon such
exercise.

            3. Net  Exercise  Provision.  The Holder,  in lieu of  exercising  a
Warrant  for a  specified  number  of shares of  Common  Stock  (the  "Exercised
Shares") and paying the aggregate  Exercise Price  therefor,  may elect,  at any
time on or before the  expiration of the Warrant,  to receive a number of shares
of Common Stock equal to the number of Exercised Shares minus a number of shares
of Common Stock having an aggregate  market value on such day of election  equal
to the Exercise Price.  After any such election,  the number of shares of Common
Stock covered by the Holder's Warrant shall be deemed  automatically  reduced by
the number of Exercised Shares.

            4.  Effect  of  Exercise.  Exercise  shall be  deemed  to have  been
effected at the time at which the form of election to purchase  and the exercise
price shall have been  received by the Company and this Warrant  shall have been
duly  surrendered,  and the  person  or  persons  in  whose  name or  names  any
certificate  or  certificates  for shares of Common Stock shall be issuable upon
such exercise  shall be deemed to have become on that date the holder or holders
of record of the shares of Common Stock represented thereby;  except that if the
stock  transfer  books  of the  Company  shall  be  closed  on the  date of such
surrender,  the date of exercise  shall be deemed to be the date upon which such
transfer books shall be reopened.

            5.    Balance of Warrant  Certificate.  Upon exercise of a Warrant
Certificate  in part  rather  than in whole,  the  Company  shall  execute and
deliver  to  or to  the  order  of  the  Holder,  a  new  Warrant  Certificate
evidencing the number of Warrants remaining unexercised.

            6.  Adjustment to Exercise Price;  Number of Warrants.  The exercise
price per share shall be subject to  adjustment as follows;  provided,  however,
that if approval of such  adjustment by the Company's  stockholders  is required
under  applicable  rules of the American Stock Exchange,  such approval shall be
obtained prior to adjustment:

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                  (1) In case the  Company  shall (i) pay a  dividend  or make a
distribution  to all holders of its Common Stock in shares of its capital  stock
(whether  shares of Common Stock or of capital stock of any other  class),  (ii)
subdivide its outstanding  shares of Common Stock, (iii) combine its outstanding
shares of  Common  Stock  into a smaller  number  of  shares;  or (iv)  issue by
reclassification  of its shares of Common  Stock any shares of capital  stock of
the Company, the exercise price in effect immediately prior to such action shall
be adjusted so that the holder of a Warrant thereafter  surrendered for exercise
shall be  entitled  to  receive  the  number of shares of  capital  stock of the
Company that such Warrant  Holder would have owned  immediately  following  such
action had the Warrant been converted  immediately prior thereto.  An adjustment
made pursuant to this paragraph shall become effective retroactively immediately
after the record date in the case of a dividend or distribution and shall become
effective  immediately  after the effective  date in the case of a  subdivision,
combination or reclassification.  If, as a result of an adjustment made pursuant
to this  paragraph,  the  holder  of this  Warrant  thereafter  surrendered  for
exercise  shall  become  entitled  to receive  shares of two or more  classes of
capital  stock of the  Company,  the Board of  Directors  of the  Company  shall
determine the allocation of the adjusted  exercise price between or among shares
of such classes of capital stock.

                  (2) In case the Company  shall issue rights or warrants to all
holders of its Common Stock  entitling them to subscribe for or purchase  shares
of Common  Stock at a price per share  less than the  current  market  price per
share on the record date set for the  issuance of such rights or  warrants,  the
Exercise  Price  shall be  adjusted  so that  the same  shall  equal  the  price
determined by multiplying the Exercise Price in effect  immediately prior to the
date of issuance of such rights or warrants by a fraction of which the numerator
shall be the  number  of  shares  of  Common  Stock  outstanding  on the date of
issuance  of such  rights  or  warrants  plus the  number  of  shares  which the
aggregate offering price of the total number of shares so offered would purchase
at such current market price, and the denominator  shall be the number of shares
of Common Stock  outstanding  on the date of issuance of such rights or warrants
plus the number of additional shares of Common Stock offered for subscription or
purchase. Such adjustment shall become effective retroactively immediately after
the record date for the  determination of shareholders  entitled to receive such
rights or warrants.

                  (3) In case the Company shall distribute to all holders of its
Common Stock evidence of its indebtedness or assets (excluding any cash dividend
paid from  retained  earnings of the Company) or rights or warrants to subscribe
to securities of the Company or owned by the Company, then in each such case the
Exercise  Price  shall be  adjusted  so that  the same  shall  equal  the  price
determined by multiplying the Exercise Price in effect  immediately prior to the
date of such  distribution  by a fraction  of which the  numerator  shall be the
current  market price per share of the Common Stock on the record date mentioned
below less the then fair market value (as  determined  by the Board of Directors
of the  Company) of the portion of the  evidence  of  indebtedness  or assets so
distributed or of such subscription  rights or warrants  applicable to one share
of Common  Stock,  and the  denominator  shall be such current  market price per
share of the Common Stock. Such adjustment shall become effective  retroactively
immediately after the record date for the determination of shareholders entitled
to receive such distribution.

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                  (4) No  adjustment  in the  exercise  price  shall be required
unless such  adjustment  would require an increase or decrease of at least 1% in
such price,  provided,  however,  that any  adjustments  which by reason of this
paragraph  are not  required to be made shall be carried  forward and taken into
account in any subsequent  adjustment;  and provided  further,  that  adjustment
shall be required and made in accordance with the provisions  hereof (other than
this  paragraph) not later than such time as may be required in order to protect
the  tax-free  nature of a  distribution  to the  holders of  Warrants or Common
Stock.  All  calculations  hereunder shall be made to the nearest cent or to the
nearest  one-hundredth  of a share,  as the case may be.  Anything herein to the
contrary notwithstanding,  the Company shall be entitled to make such reductions
in the  Exercise  Price,  in addition  to those  required  hereby,  as it in its
discretion  shall  determine to be  advisable in order that any such  dividends,
subdivision of shares,  distribution  of rights to purchase stock or securities,
or  distribution  of  securities  convertible  into or  exchangeable  for  stock
hereafter made by the Company to its shareholders shall not be taxable.

                  (5)  Whenever  the  Exercise   Price  is  adjusted  as  herein
provided, the Company shall promptly mail or cause to be mailed a notice of such
adjustment  to the  Holder  at its  last  address  as it shall  appear  upon the
Company's records.

                  (6) In the event that at any time as a result of an adjustment
made  pursuant  hereto,  the  Holder of a  Warrant  thereafter  surrendered  for
exercise  shall become  entitled to purchase any shares of capital  stock of the
Company other than shares of its Common Stock,  then the exercise  price of such
other shares so  receivable  upon  exercise of a Warrant shall be subject to the
same adjustments as those contained in subparagraphs (1) through (5) hereof.

                  (7) Whenever the  Exercise  Price is adjusted  pursuant to the
provisions  set forth herein,  the number of shares of Common Stock  purchasable
upon exercise of the Warrant shall simultaneously be adjusted by multiplying the
number of shares initially issuable upon exercise of the Warrant by the exercise
price in effect on the date of issuance of the Warrant and  dividing the product
so obtained by the exercise price as adjusted.

                  (8) For purposes of this Section,  the phrase  "current market
price" means, as of the date of determination, (i) if the Common Stock is at the
time traded on a securities exchange registered with the Securities and Exchange
Commission under Section 6(a) of the Securities Exchange Act of 1934, as amended
(a "National Securities Exchange"), the average of the last reported sales price
per share regular way or, in case no such reported sales have taken place on any
such  date,  the last  reported  bid price per share  regular  way,  on the five
trading days immediately  preceding the date of determination (ii) if the Common
Stock is at the time being  traded on Nasdaq  and not on a  National  Securities
Exchange, the average of the last reported sales price per share regular way or,
in the case no such  reported  sales  have  taken  place on any such  date,  the
closing bid price per share  regular way, on the five  trading days  immediately
preceding such date of determination, or (iii) if the Common Stock is not listed
for trading on a National  Securities  Exchange  or traded on Nasdaq,  an amount
equal to the fair market value of a share of Common Stock (as  determined by the
Company=s Board of Directors) as of such date of  determination as determined by
the Chief  Financial  Officer  of the  Company  using any  reasonable  method of
valuation.

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            7. Merger,  Etc. If either of the  following  shall  occur:  (a) any
consolidation  or  merger  to  which  the  Company  is a  party,  other  than  a
consolidation  or a merger in which the Company is a continuing  corporation and
which does not result in any reclassification of, or change (other than a change
in par  value or from  par  value  to no par  value or from no par  value to par
value, or as a result of a subdivision or combination) in, outstanding shares of
the Common Stock;  or (b) any sale or conveyance to another  corporation  of the
property of the Company as an entirety or substantially as an entirety; then the
holder of each Warrant then outstanding shall have the right to pay the exercise
price for such Warrant and receive the same  consideration  receivable upon such
consolidation, merger, sale or conveyance by a holder of the number of shares of
Common Stock  issuable upon exercise of such Warrant  immediately  prior to such
consolidation,  merger,  sale, or  conveyance.  The provisions of this paragraph
shall  similarly  apply  to  successive   consolidations,   mergers,   sales  or
conveyances.

            8. Reservation of Shares.  The Company covenants that it will at all
times reserve and keep available,  free from preemptive  rights,  solely for the
purpose of issue upon exercise of the Warrants,  such number of shares of Common
Stock as shall  be  issuable  upon the  exercise  of all  outstanding  Warrants,
provided,  that  nothing  contained  herein  shall be  construed to preclude the
Company  from  satisfying  its  obligations  in respect of the  exercise  of the
Warrants by delivery of shares of Common Stock which are held in the treasury of
the Company.

            9.    Registration Rights.
                  -------------------

      9.1   Demand Registration.
            -------------------

            9.1.1 Request for Registration.
                  ------------------------

                  9.1.1.1  Long  Form.  If, at any time that the  Company or any
            successor to the Company is a registrant  entitled to use a Form S-1
            under the Securities Act of 1933 as amended (the  "Securities  Act")
            and any other  form  promulgated  after  the date of this  Agreement
            applicable in circumstances  substantially  comparable to that form,
            regardless  of its  designation  (a "Long Form") to register  Common
            Stock of the Company and any  successor  to the  Company,  issued in
            exchange for the Series B Warrants (the  "Registrable  Securities"),
            the Company or its  successor  receives  from a holder or holders of
            Series B Warrants  (the  "Warrant  Holder" or "Warrant  Holders") of
            more than 51% of the  outstanding  Registrable  Securities a written
            request that the Company  effect a  registration  with respect to an
            offering of at least 50% of its outstanding  Registrable Securities,
            the Company shall:  (i) within ten (10) days, give written notice of
            the proposed registration to all Warrant Holders and (ii) as soon as
            practicable,  but in any event within one hundred  twenty (120) days
            after  receipt of the  request of the Warrant  Holder,  use its best
            efforts to effect such registration of the Registrable Securities of
            the  Warrant  Holder  together  with  all  or  such  portion  of the
            Registrable  Securities  of any other  Warrant  Holder who has given

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            written  notice  to  the  Company  within  twenty  (20)  days  after
            receiving  such written  notice from the Company  pursuant to clause
            (i) above on the Long Form specified in the notice.  Such obligation
            shall include,  without limitation,  the execution of an undertaking
            to  file   post-effective   amendments  and  to  effect  appropriate
            registrations or  qualifications  under applicable blue sky or other
            state  securities  laws and  appropriate  compliance  with exemptive
            regulations   issued  under  the   Securities   Act  and  any  other
            governmental requirements or regulations. The Company shall have the
            right, exercisable one time only, to delay the effectiveness of such
            request of the Warrant  Holders until up to one hundred eighty (180)
            days after  delivery of the request if the Board of Directors of the
            Company have determined in good faith that such a registration would
            be  seriously  detrimental  to the Company at such time.  No further
            delays after such one hundred  eighty (180) days shall be permitted.
            The Warrant  Holders  making the request  may  withdraw  the request
            during such one hundred eighty (180) day period, in which event such
            Warrant  Holders  shall not be deemed to have made the request.  The
            Company  shall not be  obligated  to take any  action to effect  any
            registration  pursuant to this Section 9.1.1.1 (i) after the closing
            of the sale of  Registrable  Securities  resulting from any previous
            registration  effected  pursuant  to  requests  under  this  Section
            9.1.1.1 or (ii) in the event the Registrable  Securities  constitute
            less  than 5% of the  outstanding  shares  of  Common  Stock  of the
            Company.

                  9.1.1.2  Short  Form.  If, at any time that the Company or any
            successor to the Company is a registrant  entitled to use a Form S-3
            under the  Securities Act and any other form  promulgated  after the
            date of this  Agreement  applicable in  circumstances  substantially
            comparable  to that form,  regardless of its  designation  (a "Short
            Form")  to  register  Registrable  Securities,  the  Company  or its
            successor  receives  from the Warrant  Holder or Warrant  Holders of
            more than 51% of the  outstanding  Registrable  Securities a written
            request that the Company  effect a  registration  with respect to an
            offering of at least 50% of its outstanding  Registrable Securities,
            the Company shall:  (i) within ten (10) days, give written notice of
            the proposed registration to all Warrant Holders and (ii) as soon as
            practicable,  but in any event within one hundred  twenty (120) days
            after  receipt of the  request of the Warrant  Holder,  use its best
            efforts to effect such registration of the Registrable Securities of
            the  Warrant  Holder  together  with  all  or  such  portion  of the
            Registrable  Securities  of any other  Warrant  Holder who has given
            written  notice  to  the  Company  within  twenty  (20)  days  after
            receiving  such written  notice from the Company  pursuant to clause
            (i) above on the Short Form specified in the notice. Such obligation
            shall include,  without limitation,  the execution of an undertaking
            to  file   post-effective   amendments  and  to  effect  appropriate
            registrations or  qualifications  under applicable blue sky or other
            state  securities  laws and  appropriate  compliance  with exemptive
            regulations   issued  under  the   Securities   Act  and  any  other
            governmental requirements or regulations. The Company shall have the
            right, exercisable one time only, to delay the effectiveness of such
            request of the Warrant  Holders until up to one hundred eighty (180)
            days after  delivery of the request if the Board of Directors of the
            Company have determined in good faith that such a registration would

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            be  seriously  detrimental  to the Company at such time.  No further
            delays after such one hundred  eighty (180) days shall be permitted.
            The Warrant  Holders  making the request  may  withdraw  the request
            during such one hundred eighty (180) day period, in which event such
            Warrant  Holders  shall not be deemed to have made the request.  The
            Company  shall not be  obligated  to take any  action to effect  any
            registration  pursuant to this Section 9.1.1.2 (i) after the closing
            of the sale of  Registrable  Securities  resulting from two previous
            registrations  effected  pursuant  to  requests  under this  Section
            9.1.1.2 or (ii) in the event the Registrable  Securities  constitute
            less  than 5% of the  outstanding  shares  of  Common  Stock  of the
            Company.

            For the  purposes  of this  Agreement,  securities  subject  to this
      Agreement shall cease to be Registrable Securities when (i) they have been
      registered  under  the  Securities  Act,  the  registration  statement  in
      connection  therewith  has been  declared  effective,  and they  have been
      disposed  of  pursuant to such  registration  statement,  or (ii) they are
      distributed  to the public  pursuant  to Rules 144 or 144A (or any similar
      provision then in force) under the Securities Act.

            9.1.2 Underwriting. If any Warrant Holder making a demand intends to
      use an underwriter to distribute the Registrable Securities covered by its
      request,  it shall so advise the  Company in its  request  and the Company
      shall  include such  information  in its written  notice to other  Warrant
      Holders.  In such event,  the right of any Warrant Holder to  registration
      pursuant  to this  Section  9.1 shall be  conditioned  upon  such  Warrant
      Holder's  participation  in such  underwriting  and the  inclusion  in the
      underwriting of all of the Registrable  Securities  covered by the request
      of such  Warrant  Holder.  The Company  shall  enter into an  underwriting
      agreement in customary  form with an  underwriter  selected by the Warrant
      Holders  of a  majority  of  the  Registrable  Securities  proposed  to be
      included in the  underwriting,  but subject to the approval of the Company
      which shall not be unreasonably  withheld.  The underwriting agreement may
      contain  provisions  regarding  indemnification  and contribution from the
      Company.  Notwithstanding  any other provision of this Section 9.1, if the
      underwriter  advises the Warrant  Holders and the Company in writing  that
      marketing  factors  require a limitation of the number of shares of Common
      Stock  to be  included  in  the  underwriting,  then  all  shares  in  the
      underwriting  shall be  excluded  from  such  registration  to the  extent
      required  by such  underwriting  limitation  on a pro rata  basis  and the
      Company shall so advise all Warrant Holders of Registrable Securities that
      would otherwise be included in such  underwriting and registration and the
      number of shares included in such  underwriting and registration  shall be
      allocated among the Warrant Holders of Registrable  Securities  requesting
      registration in proportion, as nearly as practicable,  to the total number
      of Registrable  Securities held by such Warrant Holders at the time of the
      filing  of  the  registration  statement.  If  the  number  of  shares  of
      Registrable  Securities so excluded  exceeds  twenty  percent (20%) of the
      number of shares of Registrable  Securities which the Warrant Holders have
      requested to be included in such  registration,  then the Warrant  Holders
      shall be entitled either (i) to require that the  registration be deferred
      for such  period  of time as the  Warrant  Holders,  the  Company  and the

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      underwriter  may mutually agree upon, but in no event for more than ninety
      (90) days from delivery of a written notice of the Warrant  Holders to the
      Company  requesting  such  delay  or (ii)  to  withdraw  the  registration
      request,  provided  that it  shall  count as one of the  Warrant  Holders'
      demand  registration unless such Warrant Holder reimburses the Company for
      its pro rata share of the  out-of-pocket  expenses incurred by the Company
      in connection with such withdrawn  registration  request.  For purposes of
      the  preceding  sentence a Warrant  Holder's "pro rata share" shall mean a
      fraction the numerator of which is the number of Registrable Securities of
      such  Warrant   Holder  which  were  to  have  been   registered  in  such
      registration  and the  denominator  of which is the total number of shares
      which were to have been  registered in such  registration.  If any Warrant
      Holder  of  Registrable   Securities  disapproves  of  the  terms  of  the
      underwriting,  such  Warrant  Holder may elect to  withdraw  therefrom  by
      written  notice to the  Company,  the  underwriter  and the other  Warrant
      Holders delivered at least seven (7) days prior to the Company's execution
      of an  underwriting  agreement  with  respect  to  the  registration.  The
      Registrable   Securities  so  withdrawn   also  shall  be  withdrawn  from
      registration.

      9.2   Piggyback Registration.
            ----------------------

            9.2.1 If at any time the  Company or any  successor  to the  Company
      proposes to  register  any of its  securities  under the  Securities  Act,
      whether  or not for  sale for its own  account,  on a form and in a manner
      which would permit registration of Registrable  Securities for sale to the
      public  under  the   Securities   Act  and  intends  to  include  in  such
      registration any of its securities owned by Warrant Holders,  it will each
      such  time  give  prompt  written  notice  to the  Warrant  Holder  of its
      intention to do so, describing such securities and specifying the form and
      manner  and  the  other   relevant   facts   involved  in  such   proposed
      registration, and upon the written request of the Warrant Holder delivered
      (which  shall not be deemed a request  for a Demand  Registration)  to the
      Company  within 30 days after the giving of any such notice (which request
      shall specify the Registrable Securities intended to be disposed of by the
      Warrant  Holder  and the  intended  method of  disposition  thereof),  the
      Company  will  effect the  registration  under the  Securities  Act of all
      shares of Common Stock which the Company has been so requested to register
      by the Warrant Holder which are in the same  proportion to total number of
      shares of Common Stock as the other  shares to be sold by Warrant  Holders
      in the  registration to the extent requisite to permit the disposition (in
      accordance  with the intended  methods thereof as aforesaid) of the shares
      so to be registered, provided that:

            (a)   if,  at  any  time  after  giving   written  notice  of  its
                  intention  to register  any of its  securities  and prior to
                  the effective date of the  registration  statement  filed in
                  connection  with  such   registration,   the  Company  shall
                  determine  for any reason not to register  such  securities,
                  the Company may, at its  election,  give  written  notice of
                  such  determination  to the  Warrant  Holder  and  thereupon
                  shall  be  relieved  of  its   obligation  to  register  any
                  Registrable  Securities in connection with such registration
                  (but  not  from  its  obligation  to  pay  the  Registration
                  Expenses  already   incurred  in  connection   therewith  as
                  provided in subdivision (b) of this Section 9.2);

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            (b)   The Company shall not be obligated to effect any  registration
                  of  shares   under  this   Section  9.2   incidental   to  the
                  registration  of any  of its  securities  in  connection  with
                  mergers, acquisitions,  exchange offers, dividend reinvestment
                  plans,  employee stock  ownership plans or stock option plans,
                  thrift plans,  pension plans or other employee  benefit plans;
                  and

            (c)   The Company shall not be obligated to effect any  registration
                  of  Registrable  Securities  to the  extent  such  shares  are
                  validly excluded from an underwritten distribution pursuant to
                  Section 9.3.2 of this Agreement.

            9.2.2 The Company will pay all  Registration  Expenses in connection
      with each  registration of shares requested by the Warrant Holder pursuant
      to this Section 9.2 or Section 9.1,  whether or not such  registration has
      become effective. The term "Registration Expenses" shall mean all expenses
      incident to the Company's  performance of or compliance  with this Section
      including,  without limitation, all registration and filing fees; all fees
      and expenses of complying  with  securities or blue sky laws; all printing
      expenses; the fees and disbursements of counsel for the Company and of its
      independent  public  accountants,  including  the  expenses of any special
      audits required by or incident to such performance and compliance; and the
      reasonable  fees and  disbursements  of one counsel for all of the Warrant
      Holders.  In no event shall  Registration  Expenses include  underwriter's
      fees,  expenses,  sales  commissions  and/or discounts with respect to the
      Registrable Securities.

      9.3   Registration Procedures.
            -----------------------

            9.3.1 When the Company is required to use its best efforts to effect
      the registration of any Registrable  Securities as provided in Section 9.1
      or Section 9.2, the Company will as expeditiously as possible:

            (a)   with  respect  to  registrations  under  Section  9.1  only,
                  prepare  and (in any event  within 90 days  after the end of
                  the period  within which  requests for  registration  may be
                  delivered  to the  Company)  file  with the  Securities  and
                  Exchange   Commission  (the   "Commission")  a  registration
                  statement  on the  appropriate  form  with  respect  to such
                  Registrable  Securities and use reasonable  efforts to cause
                  such registration  statement to become effective as promptly
                  as practicable;

                                       9
<PAGE>

            (b)   prepare and file with the  Commission  such  amendments  and
                  supplements   to  such   registration   statement   and  the
                  prospectus used in connection  therewith as may be necessary
                  to  keep  such  registration   statement  effective  and  to
                  comply  with  the  provisions  of the  Securities  Act  with
                  respect to the  disposition  of all  shares of Common  Stock
                  covered by such  registration  statement  until the  earlier
                  of: (a) such time as all of such shares  have been  disposed
                  of in accordance  with the intended  methods of  disposition
                  by  the  seller  thereof  set  forth  in  such  registration
                  statement;  or (b) the  expiration of nine months after such
                  registration statement becomes effective;

            (c)   furnish to the seller of such  Registrable  Securities  such
                  number of conformed  copies of such  registration  statement
                  and of each such amendment and  supplement  thereto (in each
                  case including all  exhibits),  such number of copies of the
                  prospectus   included   in   such   registration   statement
                  (including  each  preliminary  prospectus  and  any  summary
                  prospectus),  in  conformity  with the  requirements  of the
                  Securities Act, such documents  incorporated by reference in
                  such  registration  statement or prospectus,  and such other
                  documents, as the seller may reasonably request;

            (d)   use   reasonable   efforts  to   register   or  qualify  all
                  Registrable   Securities   covered   by  such   registration
                  statement  under such other  securities  or blue sky laws of
                  such   jurisdictions   within  the  United  States  and  its
                  territories  as the seller  shall  reasonably  request  with
                  concurrence of the managing underwriter,  if any, and do any
                  and all other  acts and  things  which may be  necessary  or
                  advisable   to  enable   the   seller  to   consummate   the
                  disposition  in  such   jurisdictions   of  its  Registrable
                  Securities  covered by such registration  statement,  except
                  that the Company  shall not for any such purpose be required
                  to  qualify   generally   to  do   business   as  a  foreign
                  corporation  in  any  jurisdiction  wherein  it  is  not  so
                  qualified,  or to  subject  itself to  taxation  in any such
                  jurisdiction,  or to consent  to general  service of process
                  in any such jurisdiction;

            (e)   immediately  notify  the  seller of  Registrable  Securities
                  covered by such registration  statement,  at any time when a
                  prospectus  relating  thereto is  required  to be  delivered
                  under the  Securities  Act, of the happening of any event as
                  a  result  of  which  the   prospectus   included   in  such
                  registration  statement,  as then  in  effect,  includes  an
                  untrue  statement  of a material  fact or omits to state any
                  material fact required to be stated  therein or necessary to
                  make the  statements  therein not misleading in the light of
                  the circumstances  then existing,  and at the request of the
                  seller  prepare  and  furnish  to the  seller  a  reasonable
                  number of copies of a supplement  to or an amendment of such
                  prospectus  as may  be  necessary  so  that,  as  thereafter
                  delivered to the purchasers of such Registrable  Securities,
                  such prospectus  shall not include an untrue  statement of a
                  material  fact or omit to state a material  fact required to
                  be  stated  therein  or  necessary  to make  the  statements
                  therein  not  misleading  in the light of the  circumstances
                  then existing; and

                                       10
<PAGE>

            (f)   otherwise  use   reasonable   efforts  to  comply  with  all
                  applicable  rules and  regulations  of the  Commission,  and
                  make  available  to  its  securities  holders,  as  soon  as
                  reasonably  practicable,  an earnings statement covering the
                  period  of  at  least  twelve  months,  but  not  more  than
                  eighteen  months,  beginning  with  the  first  month of the
                  first  fiscal  quarter  after  the  effective  date  of such
                  registration  statement,   which  earnings  statement  shall
                  satisfy the  provisions of Section 11 (a) of the  Securities
                  Act.

            9.3.2 If the Company at any time  proposes  to  register  any of its
      securities  under the  Securities  Act whether or not for sale for its own
      account as  contemplated  by Section  9.2, and such  securities  are to be
      distributed by or through one or more underwriters,  the Company shall, if
      requested by the Warrant Holder who requests  incidental  registration  of
      shares in connection  therewith  pursuant to Section 9.2, arrange for such
      underwriters  to  include  such  shares  among  those   securities  to  be
      distributed by or through such underwriters;  provided,  however,  that if
      the Company and the  underwriters  shall jointly  determine as provided in
      Section  9.3.3 that the  inclusion  of all or a specified  portion of such
      shares would adversely affect such offering, the Warrant Holder requesting
      incidental  registration  shall have its shares  excluded or cut-back from
      such  underwritten  offering  as provided  in Section  9.3.3.  The Warrant
      Holder  on  whose  behalf  such  shares  are  to be  distributed  by  such
      underwriters  shall be a party to any such underwriting  agreement and the
      representations  and warranties  by, and the other  agreements on the part
      of, the Company to and for the benefit of such underwriters, shall also be
      made to and for the benefit of Warrant Holder.

            9.3.3 If the Warrant  Holder has  requested  registration  of shares
      pursuant to Section 9.1,  such shares shall have priority for inclusion in
      an  underwritten  offering  on a pro rata  basis  with all  other  Warrant
      Holders of Registrable  Securities,  notwithstanding  (i) any  contractual
      right to  "demand,"  "piggyback,"  or  "other  right to cause  incidental"
      registration  now  existing or  hereafter  arising and (ii) the shares the
      Company has requested to be included in the  registration.  If the Warrant
      Holder  has  requested  inclusion  of shares in an  underwritten  offering
      pursuant  to Section  9.2,  such  shares may be  excluded or the number of
      shares included shall be cut-back if the managing  underwriter  shall have
      determined  (and shall have advised the Company in writing)  that,  in its
      opinion,  the registration and distribution of all or a specified  portion
      of the shares as part of the proposed  distribution  of  securities by the
      underwriters will materially and adversely affect the distribution of such
      securities  (such  opinion to state the specific  reasons  therefor).  Any
      cut-back as provided  herein  shall be pro rata among all owners of shares
      (other than the Company) to be sold through such underwritten  offering in
      the same  proportion to total share  ownership as the other shares sold by
      other share owners in the underwritten offering.

                                       11
<PAGE>

            9.3.4  If any  registration  pursuant  to  Section  9.2  shall be in
      connection with an underwritten  public offering in which a Warrant Holder
      participates, such Warrant Holder agrees, if so timely required in writing
      by  the  managing   underwriters,   not  to  effect  any  public  sale  or
      distribution  of  shares  of  Common  Stock  (other  than  as part of such
      underwritten  public  offering)  within the period  commencing  seven days
      prior to the effective date of such  registration  statement and ending no
      later than one hundred  eighty (180) days after the effective date of such
      registration statement.

            9.4   Indemnification.
                  ---------------

            9.4.1 In the  event of any  registration  of any  securities  of the
      Company under the  Securities  Act pursuant to this Section 9, the Company
      will, and hereby does,  indemnify and hold harmless Warrant Holder selling
      any Registrable  Securities  covered by such registration  statement,  its
      managers,  directors  and  officers,  and each other  person,  if any, who
      controls  such Warrant  Holder within the meaning of the  Securities  Act,
      against any losses, claims,  damages,  liabilities and expenses (including
      reasonable legal fees and expenses and costs of  investigation),  joint or
      several,  to which such Warrant  Holder or any such  manager,  director or
      officer or controlling  person may become subject under the Securities Act
      or otherwise,  insofar as such losses,  claims,  damages,  liabilities  or
      expenses (or actions or  proceedings  in respect  thereof) arise out of or
      are based upon (i) any untrue statement or alleged untrue statement of any
      material fact  contained in any  registration  statement  under which such
      securities  were  registered  under the  Securities  Act, any  preliminary
      prospectus,  final prospectus or summary prospectus  included therein,  or
      any  amendment or  supplement  thereto,  or any document  incorporated  by
      reference  therein,  or (ii) any  omission  or alleged  omission  to state
      therein a material fact required to be stated therein or necessary to make
      the statements therein not misleading, and the Company will reimburse such
      Warrant Holder, and each such manager, officer, and controlling person for
      any legal or any other expenses  reasonably incurred by them in connection
      with investigating or defending any such loss, claim, liability, action or
      proceeding;  provided  that the  Company  shall  not be  liable to such an
      indemnified person in any such case to the extent (but only to the extent)
      that any such loss, claim,  damage,  liability (or action or proceeding in
      respect  thereof)  or  expense  arises  out of or is based  upon an untrue
      statement or alleged untrue statement or omission or alleged omission made
      in such registration  statement,  any such preliminary  prospectus,  final
      prospectus,  summary prospectus,  amendment or supplement or any documents
      incorporated  by  reference  in any of the above in  reliance  upon and in
      conformity with written  information  furnished by such indemnified person
      to the  Company  and  designated  by  such  person  to be  for  use in the
      preparation thereof.  Such indemnity shall remain in full force and effect
      regardless  of any  investigation  made by or on  behalf  of such  Warrant
      Holder or any such  manager,  officer,  or  controlling  person  and shall
      survive the transfer of such securities by the Warrant Holder.

                                       12
<PAGE>

            9.4.2 The Company  shall  require,  as a condition to including  any
      shares of Commons Stock in any  registration  statement  filed pursuant to
      this  Section 9, that the  Company  shall  have  received  an  undertaking
      reasonably  satisfactory to it from the Warrant  Holder,  to indemnify and
      hold  harmless  (in the same manner and to the same extent as set forth in
      Section 9.4.1) the Company,  each director of the Company, each officer of
      the  Company  who shall sign such  registration  statement  and each other
      person,  if any,  who  controls  the  Company  within  the  meaning of the
      Securities  Act,  with respect to any  statement in or omission  from such
      registration statement,  any preliminary  prospectus,  final prospectus or
      summary  prospectus  included  therein,  or any  amendment  or  supplement
      thereto or any documents incorporated by reference in any of the above, if
      such  statement  or omission was made in reliance  upon and in  conformity
      with written  information  furnished to the Company by such Warrant Holder
      designating  that it is for use in the  preparation  of such  registration
      statement,  preliminary prospectus, final prospectus,  summary prospectus,
      amendment or  supplement.  Such  indemnity  shall remain in full force and
      effect regardless of any investigation made by or on behalf of the Company
      or any such member,  officer or  controlling  person and shall survive the
      transfer of such securities by such Warrant Holder; provided however, that
      to the extent permitted by law, a seller's  liability  hereunder shall not
      exceed the aggregate net offering  proceeds received by the Warrant Holder
      from the sale of such shares.

            9.4.3  If the  indemnification  provided  for  in  this  Section  is
      unavailable  or  insufficient  to hold  harmless an  indemnified  party in
      respect of any losses, claims, damages, liabilities, expenses or action in
      respect  thereof  referred to herein,  then the  indemnifying  party shall
      contribute  to the amount paid or payable by such  indemnified  party as a
      result of such losses, claims, damages,  liabilities,  expenses or actions
      in such  proportion as is appropriate to reflect the relative fault of the
      indemnifying  party  on the one  hand,  and the  indemnified  party on the
      other,  in connection  with the statement or omissions  which  resulted in
      such losses, claims, damages, liabilities,  expenses or actions as well as
      any other relevant equitable considerations, including the failure to give
      the notice required  hereunder.  The relative fault of indemnifying  party
      and the indemnified party shall be determined by reference to, among other
      things,  whether the untrue or alleged untrue statement of a material fact
      relates  to  information   supplied  by  the  indemnifying  party  or  the
      indemnified party and the parties' relative intent,  knowledge,  access to
      information  and  opportunity  to  correct or prevent  such  statement  or
      omission.  The Company and the Warrant  Holder  agree that it would not be
      just  and  equitable  if  contributions  pursuant  to  this  Section  were
      determined  by pro rata  allocation  or by any other method of  allocation
      which did not take  account of the  equitable  considerations  referred to
      above.  The amount paid or payable to an indemnified  party as a result of
      the losses,  claims,  damages,  liabilities or action in respect  thereof,
      referred to above,  shall be deemed to include any legal or other expenses
      reasonably   incurred  by  such  indemnified   party  in  connection  with
      investigating or defending any such action or claim.  Notwithstanding  the
      contribution  provisions  of this  Section,  in no event  shall the amount
      contributed  by any seller of shares  exceed the  aggregate  net  offering
      proceeds  received by such seller from the sale of such shares.  No person
      guilty of  fraudulent  misrepresentations  (within  the meaning of Section
      11(f) of the Securities  Act) shall be entitled to  contribution  from any
      person who is not guilty of such fraudulent misrepresentation.

                                       13
<PAGE>

            9.4.4 Promptly  after receipt by an  indemnified  party of notice of
      the commencement of any action or proceeding involving a claim referred to
      in the preceding  subdivisions  of this Section,  such  indemnified  party
      will, if a claim in respect  thereof is to be made against an indemnifying
      party,  give  written  notice to the  latter of the  commencement  of such
      action,  provided that the failure of any indemnified party to give notice
      as  provided  herein  shall  not  relieve  the  indemnifying  party of its
      obligations under the preceding subdivisions of this Section unless and to
      the extent that the  indemnifying  party is  prejudiced by such failure or
      delay.  In case any such action is brought  against an indemnified  party,
      the  indemnifying  party shall be entitled to participate in and to assume
      the defense thereof,  jointly with any other  indemnifying party similarly
      notified,  to  the  extent  that  it may  wish,  with  counsel  reasonably
      satisfactory  to  such  indemnified  party,  and  after  notice  from  the
      indemnifying  party to such indemnified party of its election so to assume
      the defense thereof,  the  indemnifying  party shall not be liable to such
      indemnified party for any legal or other expenses subsequently incurred by
      the latter in connection with the defense thereof; provided, however, that
      if the indemnified party or parties reasonably determine that there may be
      a conflict between the positions of the indemnifying  party or parties and
      of the  indemnified  party or parties in  conducting  the  defense of such
      action or proceeding or that there may be legal defenses available to such
      indemnified  party  or  parties  different  from or in  addition  to those
      available to the indemnified party or parties such that (and solely to the
      extent that) joint  representation would be inappropriate under applicable
      ethical considerations  published by the State Bar of the state applicable
      to such counsel,  then counsel for the indemnified  party or parties shall
      be entitled to conduct the defense to the extent reasonably  determined by
      such counsel to be necessary to protect the  interests of the  indemnified
      party or parties  (and the  indemnifying  party or parties  shall bear the
      reasonable legal and other expenses incurred in connection therewith).  No
      indemnifying party will consent to entry of any judgment or enter into any
      settlement  which does not include as an  unconditional  term  thereof the
      giving by the claimant or plaintiff  to such  indemnified  party of a full
      and  final  release  from  all  liability  in  respect  to such  claim  or
      litigation.

            9.4.5  Indemnification  similar to that  specified in the  preceding
      subdivisions  of this Section (with  appropriate  modifications)  shall be
      given by the  Company  and each  seller of shares  of  Common  Stock  with
      respect  to any  required  registration  or  other  qualification  of such
      Registrable  Securities  under any federal or state law or  regulation  of
      governmental authority other than the Securities Act.

            10.  Legality  of Issue.  The Company  covenants  that all shares of
Common Stock which shall be issued upon exercise of the Warrants will upon issue
be fully paid and  non-assessable  and free from all taxes,  liens,  charges and
security interests with respect to the issue thereof.

            11.  Transfer  Taxes.  The issuance of  certificates of Common Stock
upon  exercise of Warrants  shall be made without  charge for any stamp or other
similar tax in respect of such issuance.  However, if any such certificate is to
be issued in a name other than that of the holder of the Warrant converted,  the
person or persons  requesting the issuance  thereof shall pay to the Company the
amount of any tax which may be payable in respect of any  transfer  involved  in
such issuance or shall  establish to the  satisfaction  of the Company that such
tax has been paid.

                                       14
<PAGE>

            12. Notice to Warrant  Holders.  In case: (a) the Company shall take
any action which would require an adjustment in the Exercise  Price;  or (b) the
Company  shall  authorize  the  granting to the  holders of its Common  Stock of
rights or warrants to subscribe for or purchase any shares of stock of any class
or of any other  rights and notice  thereof  shall be given to holders of Common
Stock; or (c) there shall be any capital  reorganization or  reclassification of
the Common Stock (other than a subdivision  or  combination  of the  outstanding
Common  Stock and  other  than a change in par value or from par value to no par
value  or  from  no  par  value  to  par  value  of the  Common  Stock),  or any
consolidation  or merger to which the Company is a party and for which  approval
of any  shareholders of the Company is required,  or any sale or transfer of all
or  substantially  all of the  assets of the  Company;  or (d) there  shall be a
voluntary or involuntary dissolution,  liquidation or winding-up of the Company;
then the Company shall cause to be given to the Holder at least 10 days prior to
the  applicable  date  hereinafter  specified,  a notice stating (i) the date on
which a record is to be taken for the  purpose of any  distribution  or grant to
holders  of Common  Stock,  or,  if a record is not to be taken,  the date as of
which the holders of Common Stock of record to be entitled to such  distribution
or grant are to be  determined  or (ii) the date on which  such  reorganization,
reclassification,    consolidation,   merger,   sale,   transfer,   dissolution,
liquidation  or winding-up is expected to become  effective,  and the date as of
which it is expected that holders of Common Stock of record shall be entitled to
exchange  their  shares  of  Common  Stock  for  securities  or  other  property
deliverable upon such reorganization,  reclassification,  consolidation, merger,
sale,  transfer,  dissolution,  liquidation or winding-up.  Failure to give such
notice or any defect  therein  shall not affect the  legality or validity of the
proceedings  described in clauses (a),  (b), (c) or (d) of this  paragraph.  The
notice  requirements  of this  paragraph  shall  be  deemed  met if the  Company
notifies the Holder at the time and in the manner it shall notify the holders of
its Common Stock.

            IN WITNESS  WHEREOF,  Heartland  Technology,  Inc.  has caused  this
Warrant Certificate to be duly executed under its corporate seal.

DATED:      As of October 17, 2000
                                    HEARTLAND TECHNOLOGY, INC.
ATTEST:

_______________________             By: ___________________________________
Title:                                          Title:

                                       15
<PAGE>

                         FORM OF ELECTION TO PURCHASE

                  (To be executed upon exercise of Warrant.)

      The  undersigned   hereby   irrevocably  elects  to  exercise  the  right,
represented by this Warrant  Certificate,  to purchase  _____________ Shares and
herewith  tenders in payment for such shares in United States dollars in cash or
by certified or official bank check in  immediately  available  funds payable to
the  order of  Heartland  Technology,  Inc.,  all in  accordance  with the terms
hereof.  The  undersigned  requests  that the  certificate  for such  Shares  be
registered in the name of ____________________________________  whose address is
_____________________________  and that such  certificate  shall be delivered to
__________________________________________        whose        address        is
_________________________________________. If said number of Shares is less than
all of the Shares  purchasable  hereunder,  the undersigned  requests that a new
Warrant Certificate  representing the right to purchase the remaining balance of
the Shares be registered in the name of __________________________________ whose
address  is  __________________________________________________  and  that  such
Warrant Certificate be delivered to ___________________________ whose address is
___________________________________.

DATED: ___________________________

(Insert Social Security or
Other Identifying Number of
Holder): ______________________

                                      Signature_______________________________
                                       (Signature must conform in all respect
                                        to name of holder as specified on the
                                        face of the Warrant.)

Signature Guarantee:
(required if an assignment of Shares
acquired on exercise, or an assignment
of Warrants remaining after exercise,
is made upon exercise):

                                       16
<PAGE>

                              [FORM OF ASSIGNMENT]

       (To be executed by the registered holder if such holder desires to
                       transfer the Warrant Certificate.)

FOR VALUE RECEIVED the undersigned hereby sells,  assigns,  and transfers unto
______________________________________________________________________________
this Warrant Certificate,  together with all right, title, and interest therein,
and does hereby irrevocably constitute and appoint _____________________________
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company,  with full power of substitution.

DATED: _____________________

(Insert Social Security or
Other Identifying Number of
Holder): ______________________

Signature Guarantee:                  Signature_______________________________
                                       (Signature must conform in all respect
                                        to name of holder as specified on the
                                        face of the Warrant.)

                                       17Exhibit 10.2

                             13% Subordinated Note
                             Due October 17, 2005

      Heartland Technology, Inc., a Delaware corporation (hereinafter called the
"Company",  which term includes any successor corporation),  for value received,
hereby  promises to pay to the order of EDWIN JACOBSON or the registered  holder
hereof  (the  "Holder"),   on  October  17,  2005,  the  sum  of  Three  Hundred
Seventy-Five  Thousand Dollars ($375,000) and to pay interest thereon,  from the
date  hereof,  quarterly  on March 31, June 30,  September 30 and December 31 in
each year, at the rate of 13% per annum. Interest shall be computed on the basis
of a 365 or 366 day year and actual days elapsed.

      This Note is a duly authorized subordinated note of the Company designated
as its "13%  Subordinated  Note Due October 17,  2005"  (hereinafter  called the
"Note").  The  obligations  of the Company  under the Note and the rights of the
Holder of this Note are  subordinated  to all loans to the  Company  by banks or
other financial  institutions ("Bank Debt") provided that so long as the Company
is not in default under any Bank Debt, the Company shall make all payments under
the Note in accordance with the terms hereof.  In the event the Company defaults
under any Bank Debt and the default has been cured or waived in conformity  with
the terms of the  applicable  Bank Debt,  the  Company  shall make all  required
payments under the Note.

      The Company  shall pay interest on this Note to the  registered  Holder of
this Note.

      The Company shall be entitled, at its option, to prepay all or any portion
of  this  Note,  including  all  accrued  interest  thereon,  by  providing  the
registered Holder of this Note with irrevocable  written notice of the Company's
election  to prepay this Note.  Such notice  shall be sent to the address of the
registered  Holder of this Note and shall include the date on which the Note (or
any  portion  thereof)  shall be paid (the "Call  Date") and the amount (if less
than all of the Note) to be prepaid. The Holder of this Note shall surrender the
Note at the principal office of the Company in Chicago,  Illinois. To the extent
that less than all of the Note is prepaid at any time,  the Company  shall issue
to the registered  Holder a replacement Note for the amount of the original Note
not prepaid.  Once prepaid,  no interest shall accrue,  and no interest shall be
paid, on any portion of any Note which is so prepaid.

      Payment of the  principal  of (and  premium,  if any) and interest on this
Note will be made to the address of the registered  Holder of this Note, in such
coin or  currency  of the United  States of America as at the time of payment is
legal tender for payment of public and private debts.

<PAGE>

      The  Company  represents  and  warrants  to Holder that (a) this Note is a
valid  and  binding  agreement,  enforceable  according  to its  terms;  (b) the
execution,  delivery and performance of its  obligations  under this Note do not
create any default under any other  agreement to which  Company is a party;  (c)
Company has paid all applicable income and property taxes of whatever kind which
are due and (d)  immediately  following the borrowing  under this Note,  Company
will be able to pay its known and  reasonably  anticipated  debts as they mature
and will have assets  which will have a fair  saleable  value  greater  than the
amount of its indebtedness.

      All sums due hereunder  shall, at the sole option of Holder (except in the
case of the  occurrence  of an event  described in clause (4),  (5), (6), (8) or
(9), in which event such sum shall automatically, without further action, become
immediately due and payable),  become due on demand and  immediately  become due
and payable upon such  demand,  upon  written  notice to the  Company,  upon the
occurrence of any of the following events (each, an "Event of Default"):

(1)   the Company  shall fail to make any payment of interest on this Note or on
      any of the 13% Subordinated  Notes  heretofore  issued by the Company (the
      "13% Subordinated Notes") at the time such payment is due and such failure
      to pay shall  continue for five days or the Company shall fail to make any
      payment of principal on this Note or any of the 13% Subordinated  Notes at
      the time such payment is due; or

(2)   the Company shall  default in the due  performance  and  observance of any
      term,  covenant or agreement contained in this Note and such default shall
      continue  unremedied for a period of thirty (30) days after notice thereof
      shall have been given to the  Company by the  Holder,  provided,  however,
      that if such default cannot be cured within such 30-day  period,  all sums
      due  hereunder  shall not become due and payable if Company is  diligently
      and in good faith  proceeding  to cure such  default  and such  default is
      cured within sixty (60) days after notice thereof from Holder to Company);

(3)   the Company  shall  default in any payment of  principal of or interest on
      any Bank Debt beyond any period of grace provided with respect thereto, or
      shall  default in the  performance  of any  agreement,  term or  condition
      contained in any agreement under which any Bank Debt is created (or if any
      other default under any such  agreement  shall occur and be continuing) if
      the effect of such default is to cause, or to permit the holder or holders
      of any Bank Debt (or a trustee  on behalf of such  holder or  holders)  to
      cause,  such Bank Debt to become due prior to its stated maturity and such
      default shall continue for more than 30 days without being cured or waived
      by the lender under the applicable Bank Debt; or

                                       2
<PAGE>

(4)   a receiver, liquidator or trustee of the Company or of any property of the
      Company  shall be  appointed  by court order and such order  shall  remain
      unstayed  and in effect  for more than 60 days;  or the  Company  shall be
      adjudged  bankrupt  or  insolvent;  or any of the  property of the Company
      shall be  restrained,  attached,  or  sequestered by court order or become
      subject to any levy of any court and such order shall remain  unstayed and
      in effect for more than 60 days; or a petition to  reorganize  the Company
      under  any  bankruptcy,   reorganization,   arrangement,   moratorium,  or
      insolvency law or code or other debtor relief  proceedings  shall be filed
      against the Company and shall not be  dismissed  within 60 days after such
      filing or an order for relief  shall be entered  against  the  Company (it
      being  understood that for the purposes of Sections (4), (5), (6), (8) and
      (9), the term the "Company@  includes any "significant  subsidiary" of the
      Company  as  that  term  is  defined  by  the   Securities   and  Exchange
      Commission); or

(5)   the Company  shall file a petition in voluntary  bankruptcy  or requesting
      relief  under  any  provision  of  any  bankruptcy,   reorganization,   or
      insolvency  law or shall consent to the filing of any petition  against it
      under any such law or code; or

(6)   the Company shall make an  assignment  for the benefit of its creditors or
      consent to the  appointment of a receiver,  trustee,  or liquidator of the
      Company or of all or any part of the property of the Company; or

(7)   final  judgments  for payment of money  aggregating  in excess of $500,000
      shall be  outstanding  against the  Company and any one of such  judgments
      shall  have  been  outstanding  for more than 60 days from the date of its
      entry and shall not have been discharged in full or stayed; or

(8)   the Company  shall be  dissolved  or  liquidated  or the  existence of the
      Company shall terminate  except pursuant to a merger pursuant to which the
      Notes become obligations of the surviving entity; or

(9)   any seizure,  vesting,  or  intervention  by or under the authority of any
      governmental agency by which the management of the Company is displaced or
      its authority in the conduct of its business is curtailed shall occur.

      The  existence  or   continuation   of  any  Event  of  Default  shall  be
irrespective of whether such Event of Default or the underlying facts shall have
come about voluntarily or involuntarily or shall be beyond the Company=s control
or shall have come about or been  effected by operation of law or pursuant to or
in  compliance  with any judgment,  decree,  or order of any court or any order,
rule, or regulation of any administrative or governmental body.

      The  obligation  of the Company  hereunder  to pay the  principal  of (and
premium,  if any) and interest on this Note at the times, place and rate, and in
the coin or currency, herein prescribed is absolute and unconditional.

      This Note is transferable,  in whole or in part, by the registered  Holder
hereof.

      The  Company  and any agent of the  Company  may treat the  bearer of this
Note, or, if this Note is registered as herein  authorized,  the person in whose
name the same is  registered,  as the absolute  owner hereof and thereof for all
purposes,  whether  or not this Note or any  payment  thereon  be  overdue,  and
neither  the  Company  nor any such  agent  shall be  affected  by notice to the
contrary.

                                       3
<PAGE>

      If any provision of this Note or the  application  thereof to any party or
circumstance  is held invalid or  unenforceable,  the remainder of this Note and
the application of such provision to other parties or circumstances  will not be
affected  thereby and the provisions of this Note shall be severable in any such
instance.

      The Company agrees to pay all costs, including attorneys' fees, reasonably
incurred by the holder hereof in enforcing  payment  hereof and hereby waives to
the  fullest  extent  permitted  by law,  all  right to  plead  any  statute  of
limitation as a defense to any action hereunder.

      The Company  hereby  waives  presentment  for payment,  demand,  notice of
dishonor  and  protest of this Note and  further  agrees that this Note shall be
deemed to have been made under and shall be governed by the laws of the State of
Illinois  in all  respects,  including  matters of  construction,  validity  and
performance,  and that none of its terms or provisions  may be waived,  altered,
modified or amended  except as the holder hereof may consent  thereto in writing
duly signed by such holder or its authorized agent.

      IN WITNESS  WHEREOF,  the Company has caused this Note to be duly executed
under its corporate seal as of the 17th day of October, 2000.

                                    HEARTLAND TECHNOLOGY, INC.

                                    By  ____________________________
                                    Its ____________________________

Attest:

------------------------

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