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                                                                   EXHIBIT 10.23

PAYMENT OF THIS NOTE IS SUBORDINATED TO THE PAYMENT OF ALL OBLIGATIONS OF THE
COMPANY TO ANY HOLDER OF "SENIOR DEBT," AS DEFINED HEREIN.

THIS NOTE AND ANY SHARES ACQUIRED UPON THE CONVERSION OF THIS NOTE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE
SECURITIES LAWS. THIS NOTE AND SUCH SHARES ARE NOT TRANSFERABLE WITHOUT
COMPLIANCE WITH THE REGISTRATION REQUIREMENTS OF SUCH LAWS, UNLESS AN EXEMPTION
OR EXCLUSION FROM REGISTRATION IS AVAILABLE.

              MANDATORY, REDEEMABLE, CONVERTIBLE SUBORDINATED NOTE

Date of Original Issuance: September 14, 2001                           $750,000

         FOR VALUE RECEIVED, AUTOMATED INFORMATION MANAGEMENT, INC., a Texas
corporation (the "COMPANY"), hereby promises to pay to the order of CALTON,
INC., a New Jersey corporation (the "HOLDER"), or permitted assigns, the
principal amount of Seven Hundred Fifty Thousand Dollars ($750,000), on June 14,
2002 (the "MATURITY DATE"), subject to earlier redemption or conversion as
provided herein, together with interest thereon calculated from the date hereof
in accordance with the provisions of this Note.

SECTION 1. PAYMENT OF INTEREST.

         Except as provided in SECTION 6.4 (pertaining to the Default Interest
Rate), this Note shall bear interest on the unpaid principal amount of the Note
outstanding from time to time, from and including the date hereof, as follows.
On each of November 30, 2001, February 28, 2002, and June 14, 2002, the Company
shall pay, in cash, the interest accrued during the preceding three-month period
at the rate of LIBOR plus one percent (1%), where LIBOR means the London
Inter-Bank Overnight Rate, as reported in the Wall Street Journal on the date
payment is made. Interest will be computed on the basis of twelve 30-day months
and a 360-day year and, for any period shorter than a full calendar month, on
the basis of the actual number of days elapsed in such period. Interest will
accrue on any principal payment due under this Note, and, unless prohibited
under applicable law, until such time as payment therefor is actually delivered
to the Holder of this Note. Any accrued interest which for any reason has not
theretofore been paid will be due and payable in full on the Maturity Date and
on any Conversion Date (as defined below) with respect to the principal amount
of the Note then being converted.

SECTION 2. REDEMPTION.

                  2.1 MANDATORY REDEMPTION BY THE COMPANY. Provided that Holder
         is not in default hereunder, the Note shall be redeemed in cash, by the
         Company, at a redemption price equal to 100% of the original principal
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         amount thereof redeemed, plus accrued and unpaid interest thereon to
         the date of redemption, at the option of the Holder, if and only if:

                                    (a) the Company's registration statement on
                  Form SB-2 (the "Registration Statement") that is to be filed
                  with the Securities and Exchange Commission to register the
                  distribution of the Common Stock is not effective by June 14,
                  2002;

                                    (b) Company does not keep the Registration
                  Statement current, or the effectiveness of the Registration
                  Statement is suspended for more than ten (10) days; or

                                    (c) a current prospectus meeting the
                  requirements of Section 10(a) of the Securities Act of 1933 is
                  not available for delivery by the Holder or a stop order is
                  issued by the Securities and exchange Commission with respect
                  to the Registration Statement.

                  2.2 OPTIONAL REDEMPTION BY THE COMPANY. This Note may be
         redeemed before the Maturity Date, in whole at any time or in part from
         time to time, in cash, at the option of the Company, at a redemption
         price equal to 100% of the original principal amount to be redeemed,
         plus accrued and unpaid interest thereon to the date of redemption.

                  2.3 PROCEDURE FOR REDEMPTION. The Company will send written
         notice (a "Redemption Notice") of its election to redeem or its offer
         to redeem this Note, as the case may be, to the Holder of this Note by
         registered or certified mail, return receipt requested, at least five
         (5) days prior to the date of redemption (the "REDEMPTION DATE"). On or
         before the Redemption Date, and upon surrender of this Note, the
         Company will deliver to the Holder of this Note the full amount of the
         redemption price (including accrued interest to the date of redemption,
         if any). If less than the entire principal amount of this Note is to be
         redeemed, in addition to delivering the redemption price, the Company
         shall also deliver, upon surrender of this Note, a new Note in
         principal amount equal to the unredeemed portion of this Note, which
         shall be issued in the name of the Holder upon cancellation of this
         Note. On and after any Redemption Date, unless the Company defaults in
         the payment of the redemption price, interest shall cease to accrue on
         this Note or the portion hereof actually redeemed. The Holder shall be
         able to convert the Note at any time prior to redemption or payment,
         including during any period between the delivery of a Redemption Notice
         and the corresponding Redemption Date, by delivering a Conversion
         Notice (as defined below) to the Company as provided for in Section 3
         hereof.

SECTION 3. CONVERSION.

                  3.1 OPTIONAL CONVERSION BY THE HOLDER. For so long as the
         Holder is not in default hereunder, the principal amount of the Note
         may be converted at the option of the Holder, in whole at any time
         before redemption or payment, into fully paid and nonassessable shares
         of common stock, with no par value (the "COMMON STOCK"), of the

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         Company. Interest shall always be payable in cash. All or any portion
         of the principal amount outstanding under this Note shall be
         convertible into shares of Common Stock at the rate of one share of
         Common Stock for each $0.75 of principal amount so converted (the
         "CONVERSION RATE").

                  3.2 MANDATORY CONVERSION . The principal of the Note must be
         converted by the Holder in whole, and not in part, into 1,000,000 fully
         paid and nonassessable shares of Common Stock of the Company at the
         Conversion Rate not later than five (5) days after the Company provides
         written notice to the Holder that the Registration Statement has been
         declared effective. Interest accrued through the Conversion Date (as
         defined below) shall be payable in cash within three days of the
         Conversion Date. Holder shall thereafter, as promptly as reasonably
         practicable after taking into account requirements under applicable
         federal and state laws and the rules and regulations of any applicable
         stock exchange or quotation system, dividend at least 662,000 shares
         (as that number may be adjusted hereunder) to the shareholders of the
         Holder pro rata; PROVIDED THAT Holder shall have no obligation to
         dividend the shares if they have not been admitted for trading on the
         NASD OTC Bulletin Board. Failure to convert and dividend in accordance
         with this Section shall be an Event of Default (as defined in SECTION
         5, below) by the Holder hereunder.

                  3.3 PROCEDURE FOR CONVERSION. In connection with any optional
         conversion, the Holder will send written notice (a "CONVERSION NOTICE")
         of its election to convert this Note to the Company by registered or
         certified mail, return receipt requested, at least five (5) days prior
         to the date of conversion (the "CONVERSION DATE"). In connection with a
         Mandatory Conversion, the Company shall send written notice (which
         notice may be sent via fax or electronic mail) to Holder, who shall be
         required to deliver the Note for surrender and exchange of Common Stock
         pursuant to the terms hereof within the five (5) day period during
         which it must convert. Within three (3) days after the Conversion Date,
         the Company will deliver to the Holder, upon surrender of this Note,
         the shares of Common Stock issuable upon such conversion. On and after
         any Conversion Date, unless the Company defaults in the delivery of
         shares of Common Stock issuable upon conversion, interest shall cease
         to accrue on this Note or the portion hereof actually converted. No
         fractional shares of Common Stock or scrip representing fractional
         shares of Common Stock shall be issued upon conversion of this Note.
         Instead of any fractional shares of Common Stock which would otherwise
         be issuable upon conversion, the Company will pay a cash adjustment in
         respect of such fractional interest in an amount equal to that fraction
         of the Conversion Rate in effect at the time of conversion.

                  3.4 RESERVATION OF COMMON STOCK. The Company will at all times
         reserve and keep available out of its authorized Common Stock, solely
         for the purpose of issuance upon the conversion of the Note as herein
         provided, such number of shares of Common Stock as shall then be
         issuable upon the conversion of the Note, which initial number of
         reserved shares shall be at least 1,000,000 shares and shall be
         adjusted upon any adjustment hereunder. The Company covenants that all
         shares of Common Stock which shall be so issued, upon full payment at
         the Conversion Rate therefor or as otherwise set forth herein, shall be
         duly and validly issued and fully paid and nonassessable and free from
         all taxes, liens and charges with respect to the issue thereof, and,

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         without limiting the generality of the foregoing, the Company covenants
         that it will from time to time take all such action as may be required
         to ensure that the par value per share, if any, of the Common Stock is
         at all times equal to or less than the effective Conversion Rate. The
         Company will take all such action as may be necessary to ensure that
         all such shares of Common Stock may be so issued without violation of
         any applicable law or regulation, or of any requirement of any national
         securities exchange or automated quotation system upon which the Common
         Stock of the Company may be listed or quoted. The Company will not take
         any action which results in any adjustment of the Conversion Rate if
         the total number of shares of Common Stock issued and issuable after
         such action upon conversion of the Note would exceed the total number
         of shares of Common Stock then authorized by the Company's Certificate
         of Incorporation. The Company has not granted and will not grant any
         right of first refusal with respect to shares issuable upon conversion
         of the Note, and there are no preemptive rights associated with such
         shares.

                  3.5 TITLE TO STOCK. All shares of the Common Stock delivered
         upon the conversion of the Note shall be validly issued, fully paid and
         nonassessable; the Holder (or holders) shall receive good and
         marketable title to the Common Stock, free and clear of all voting and
         other trust arrangements, liens, encumbrances, equities and claims
         created by the Company whatsoever.

                  3.6 ADJUSTMENT OF CONVERSION RATE AND/OR SECURITIES ISSUABLE
         UPON CONVERSION. The Conversion Rate and the number and kind of shares
         into which this Note may be converted shall be subject to adjustment
         from time to time upon the happening of certain events as provided in
         this SECTION 3.6.

                           (a) If at any time prior to the payment in full of
                  the principal amount outstanding under this Note, together
                  with all accrued and unpaid interest thereon, the Company
                  shall (i) declare a dividend or make a distribution on the
                  Common Stock payable in shares of its capital stock (whether
                  shares of Common Stock or of capital stock of any other
                  class); (ii) subdivide, reclassify or recapitalize its
                  outstanding Common Stock into a greater number of shares;
                  (iii) combine, reclassify or recapitalize its outstanding
                  Common Stock into a smaller number of shares; or (iv) issue
                  any shares of its capital stock by reclassification of its
                  Common Stock (excluding any such reclassification in
                  connection with a consolidation or a merger that is subject to
                  SECTION 3.6(g)), the Conversion Rate in effect at the time of
                  the record date of such dividend, distribution, subdivision,
                  combination, reclassification or recapitalization shall be
                  adjusted so that the Holder shall be entitled to receive the
                  aggregate number and kind of shares which, if this Note had
                  been converted in full immediately prior to such event, it
                  would have owned upon such conversion and been entitled to
                  receive by virtue of such dividend, distribution, subdivision,
                  combination, reclassification or recapitalization. Any
                  adjustment required by this SECTION 3.6(a) shall be made
                  successively immediately after the record date, in the case of
                  a dividend or distribution, or the effective date, in the case
                  of a subdivision, combination, reclassification or
                  recapitalization, to allow the purchase or conversion of such
                  aggregate number and kind of shares.

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                           (b) If at any time prior to the payment in full of
                  the principal amount outstanding under this Note, together
                  with all accrued and unpaid interest thereon, the Company
                  shall make a distribution to all holders of Common Stock of
                  stock of a subsidiary or securities convertible into or
                  exercisable for such stock, then in lieu of an adjustment of
                  the Conversion Rate or the number of shares of Common Stock
                  receivable upon the conversion of this Note (and in addition
                  to the Common Stock or other securities to be received upon
                  conversion as provided herein), the Holder, upon the
                  conversion hereof at any time after such distribution, shall
                  be entitled to receive from the Company, such subsidiary or
                  both, as the Company shall determine, the stock or other
                  securities to which such Holder would have been entitled if
                  such Holder had converted the entire principal amount
                  outstanding under this Note, together with all accrued and
                  unpaid interest thereon, into shares of Common Stock
                  immediately prior thereto, and the Company shall reserve, for
                  the life of this Note, such securities of such subsidiary or
                  other corporation; PROVIDED, HOWEVER, that no adjustment in
                  respect of dividends or interest on such stock or other
                  securities to be distributed shall be made during the term of
                  this Note or upon its conversion.

                           (c) If at any time prior to the payment in full of
                  the principal amount outstanding under this Note, together
                  with all accrued and unpaid interest thereon, the Company
                  shall issue or sell, or has issued or sold, any shares of
                  Common Stock for a consideration per share less than the
                  Market Price of the Common Stock immediately prior to the time
                  of such issue or sale, then, forthwith upon such issue or
                  sale, the Conversion Rate shall be reduced to the price
                  determined by dividing (a) an amount equal to the sum of (i)
                  the number of shares of Common Stock outstanding immediately
                  prior to such issue or sale multiplied by the then existing
                  Conversion Rate and (ii) the consideration, if any, received
                  by the Company upon such issue or sale, by (b) the total
                  number of shares of Common Stock outstanding immediately after
                  such issue or sale.

                           (d) If at any time prior to the payment in full of
                  the principal amount outstanding under this Note, together
                  with all accrued and unpaid interest thereon, the Company
                  shall issue rights, warrants or options (except for options
                  issued to employees, officers or directors after the date
                  hereof to purchase up to 1,350,000 shares of the Company's
                  Common Stock having an exercise price of not less than $0.75
                  per share) entitling the holders thereof to acquire Common
                  Stock at a price per share less than the current Market Price
                  (as hereafter defined) on such record date, then in each such
                  case the number of shares subject to this Note thereafter
                  receivable upon the conversion of this Note shall be
                  determined by multiplying the number of shares of Common Stock
                  theretofore receivable upon conversion of this Note 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, warrants or options, plus the number of additional
                  shares of Common Stock offered for subscription or purchase,
                  and of which the denominator shall be the number of shares of
                  Common Stock outstanding on the date of issuance of such
                  rights, warrants or options, plus the number of shares that
                  the aggregate offering price of the total number of shares of
                  Common Stock so offered would purchase at such current Market

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                  Price. For purposes of this SECTION 3.6(d), the issuance of
                  rights, warrants or options to subscribe for or purchase
                  securities convertible into Common Stock shall be deemed to be
                  the issuance of rights, warrants or options to purchase the
                  Common Stock into which such securities are convertible at an
                  aggregate offering price equal to the aggregate offering price
                  of such securities plus the minimum aggregate amount (if any)
                  payable upon conversion of such securities into Common Stock.

                           (e) If at any time prior to the payment in full of
                  the principal amount outstanding under this Note, together
                  with all accrued and unpaid interest thereon, the Company
                  shall issue convertible securities or evidences of
                  indebtedness of the Company that are convertible into Common
                  Stock (the "Convertible Securities") with a right to acquire
                  Common Stock at a price lower than the current Market Price,
                  then the total maximum number of shares of Common Stock
                  issuable upon conversion or exchange of all such Convertible
                  Securities shall be deemed to have been issued for such price
                  per share as of the date of the issue or sale of such
                  Convertible Securities and thereafter shall be deemed to be
                  outstanding, provided that (i) no adjustment of the Conversion
                  Rate shall be made upon the actual issue of such Common Stock
                  upon conversion or exchange of such Convertible Securities and
                  (ii) if any such issue or sale of such Convertible Securities
                  is made upon exercise of any options to purchase any such
                  Convertible Securities for which adjustments of the Conversion
                  Price have been or are to be made pursuant to other provisions
                  of this SECTION 3.6, no further adjustment of the Conversion
                  Rate shall be made by reason of such issue or sale.

                           (f) If at any time prior to the payment in full of
                  the principal amount outstanding under this Note, together
                  with all accrued and unpaid interest thereon, the Company
                  shall distribute to all holders of Common Stock evidences of
                  indebtedness of the Company or assets of the Company
                  (excluding dividends or distributions out of earned surplus)
                  or rights or warrants to subscribe for securities of the
                  Company (excluding those referred to in SECTION 3.6(b) OR
                  3.6(d) above), then in each case the Conversion Rate shall be
                  adjusted to a rate determined by multiplying the Conversion
                  Rate in effect immediately prior to such distribution by a
                  fraction, of which the numerator shall be the then current
                  Market Price per share of Common Stock on the record date for
                  determination of stockholders entitled to receive such
                  distribution, less the then fair value (as determined by the
                  Board of Directors of the Company, whose determination shall
                  be conclusive) of the portion of the assets or evidences of
                  indebtedness so distributed or of such subscription rights or
                  warrants which are applicable to one share of Common Stock,
                  and of which the denominator shall be the Market Price per
                  share of Common Stock.

                           (g) In the event of any capital reorganization of the
                  Company (other than an event referred to in SECTION 3.6(a),
                  or in case of the consolidation of the Company with, the
                  merger of the Company with or into or the sale of all or
                  substantially all of the properties and assets of the Company
                  to any other person, if in connection therewith consideration
                  is payable to holders of Common Stock (or other securities or

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                  property purchasable upon conversion of this Note) in exchange
                  therefor, this Note shall remain subject to the terms and
                  conditions set forth in this Note and this Note shall, after
                  such capital reorganization, consolidation, merger or sale be
                  convertible into the number of shares of stock or other
                  securities or assets to which a holder of the number of shares
                  of Common Stock receivable (at the time of such capital
                  reorganization, reclassification of such Common Stock,
                  consolidation, merger or sale) upon conversion of this Note
                  would have been entitled if this Note had been converted
                  immediately prior to such capital reorganization,
                  reclassification of such Common Stock, consolidation, merger
                  or sale; and in any such case, if necessary, the provisions
                  set forth in this Note with respect to the rights and
                  interests thereafter of the Holder shall be appropriately
                  adjusted so as to be applicable, as nearly as may reasonably
                  be, to any shares of stock or other securities or assets
                  thereafter deliverable on the conversion of this Note. The
                  Company shall not effect any such consolidation, merger or
                  sale, unless prior to or simultaneously with the consummation
                  thereof, the successor corporation (if other than the Company)
                  resulting from such consolidation or merger or the corporation
                  purchasing such assets or the appropriate corporation or
                  entity shall assume, by written instrument, the obligation to
                  deliver to the Holder the shares of stock, securities or
                  assets to which the Holder may be entitled pursuant to this
                  SECTION 3.6(g) and to register such securities under the
                  Securities Act of 1933.

                           (h) Notwithstanding SECTION 3.6(g), (i) if the
                  Company merges or consolidates with, or sells all or
                  substantially all of its property and assets to, any other
                  person and consideration is payable to holders of Common Stock
                  in exchange for their Common Stock in connection with such
                  merger, consolidation or sale which consists solely of cash,
                  or (ii) in the event of the dissolution, liquidation or
                  winding up of the Company, the Holder may, at its option,
                  without further demand or notice, declare the outstanding
                  principal balance of, and the accrued and unpaid interest on,
                  this Note to be immediately due and payable. In lieu of
                  requiring the payment in full or in part of this Note, the
                  Holder shall be entitled to receive distributions on the date
                  of such event described in clause (i) or (ii) above on an
                  equal basis with holders of Common Stock (or other securities
                  issuable upon conversion of this Note) as if this Note had
                  been converted immediately prior to such event. Upon receipt
                  of such payment at the option of the Holder, if any, the
                  rights of the Holder shall terminate and cease and this Note
                  shall be deemed paid in full. In case of any such merger,
                  consolidation or sale of assets, the surviving or acquiring
                  person and, in the event of any dissolution, liquidation or
                  winding up of the Company, the Company shall promptly, after
                  receipt of this surrendered Note, make payment by delivering a
                  check in such amount as is appropriate (or, in the case of
                  consideration other than cash, such other consideration as is
                  appropriate) to such person as it may be directed in writing
                  by the Holder surrendering this Note.

                           (i) If any question shall at any time arise with
                  respect to the adjusted number of shares of Common Stock or
                  other securities issuable upon conversion of this Note, such
                  question shall be determined by Deloitte & Touche, L.L.P. or

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                  an independent firm of certified public accountants of
                  recognized national standing selected by the Company and
                  reasonably acceptable to the Holder.

                           (j) Upon the expiration or termination of any
                  warrant, right or option, or any such right to convert or
                  exchange convertible securities or evidences of indebtedness,
                  the Conversion Rate then in effect hereunder shall forthwith
                  be readjusted to the Conversion Rate which would have been in
                  effect prior to the time of the issuance of the warrant,
                  right, option or convertible securities, as if they had never
                  been issued.

                           (k) In the event that at any time, as the result of
                  any adjustment made pursuant to this SECTION 3.6, the Holder
                  thereafter shall become entitled to receive any securities
                  other than Common Stock, thereafter the number of such other
                  securities so receivable upon conversion of this Note shall be
                  subject to adjustment from time to time in a manner and on
                  terms as nearly equivalent as practicable to the provisions
                  with respect to the Common Stock contained in this SECTION
                  3.6.

                           (l) POST-CLOSING PURCHASE PRICE ADJUSTMENT. If for
                  any ten (10) consecutive trading days during the ninety (90)
                  days following the effective date of the Company's
                  Registration Statement the weighted average daily trading
                  price is less than $2.22 per share, the Holder shall have the
                  right to an additional number of shares of Common Stock as set
                  forth herein. The Company shall issue an additional number of
                  shares of Common Stock to the Holder such that when added to
                  the 338,000 shares which are not subject to the dividend
                  obligation, the average market value of the sum of 338,000
                  shares plus the additional shares shall equal $750,000. The
                  average market value shall be equal to the lowest average
                  trading value (based upon the weighted average computation
                  described above) for any period of ten (10) consecutive
                  trading days during the ninety (90) day period following the
                  effectiveness of the Registration Statement. The Holder shall
                  only be entitled to one adjustment under this provision. The
                  shares shall be included in the Registration Statement.

SECTION 4. SUBORDINATION.

                  4.1 SUBORDINATION OF NOTE. The Company hereby agrees and the
         holders of the Note, by their acceptance thereof, likewise agree, that,
         to the extent and in the manner set forth in this SECTION 4, the
         payment of the principal of and interest on the Note is hereby
         expressly made subordinate and subject in right of payment to the prior
         payment in full of all amounts then due and payable in respect of all
         Senior Debt.

                  4.2 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC. In the
         event of (a) any insolvency or bankruptcy case or proceeding, or any
         receivership, liquidation, arrangement, reorganization, debt
         restructuring or other similar case or proceeding in connection with
         any insolvency or bankruptcy proceeding, relative to the Company or to
         its assets, or (b) any liquidation, dissolution or other winding up of
         the Company, whether voluntary or involuntary and whether or not
         involving insolvency or bankruptcy,

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         or (c) any assignment for the benefit of creditors or any other
         marshaling of assets and liabilities of the Company, then and in any
         such event specified in (a), (b) or (c) above (each such event, if any,
         herein sometimes referred to as a "PROCEEDING") the holders of Senior
         Debt shall be entitled to receive payment in full of principal of and
         interest and premium, if any, on such Senior Debt, or provision shall
         be made for such payment in cash or cash equivalents or otherwise in a
         manner satisfactory to the holders of Senior Debt, before the holders
         of the Note are entitled to receive or retain any payment or
         distribution of any kind or character, whether in cash, property or
         securities, on account of principal of or interest on the Note or on
         account of the purchase or other acquisition of the Note by the Company
         and to that end the holders of Senior Debt shall be entitled to
         receive, for application to the payment thereof, any payment or
         distribution of any kind or character, whether in cash, property or
         securities, which may be payable or deliverable in respect of the Note
         in such Proceeding.

                  In the event that, notwithstanding the provisions of this
         SECTION 4.2, the holders of the Note shall have received any payment or
         distribution of assets of the Company of any kind or character, whether
         in cash, property or securities, after the commencement of a Proceeding
         and before all Senior Debt is paid in full or payment thereof is
         provided for in cash or cash equivalents or otherwise in a manner
         satisfactory to the holders of Senior Debt, then and in such event such
         payment or distribution shall be paid over or delivered forthwith by
         the holders to the trustee in bankruptcy, receiver, liquidating
         trustee, custodian, assignee, agent or other person making payment or
         distribution of assets of the Company for application to the payment of
         all Senior Debt remaining unpaid, to the extent necessary to pay all
         Senior Debt in full, after giving effect to any concurrent payment or
         distribution to or for the holders of Senior Debt.

                  4.3 SUSPENSION OF PAYMENT WHEN SENIOR DEBT IN DEFAULT. (a) In
         the event and during the continuation of any default in the payment of
         principal of, premium, if any, or interest on any Senior Debt, or in
         the event that any event of default (other than a payment default) with
         respect to any Senior Debt shall have occurred and be continuing and
         such event of default shall have resulted in such Senior Debt becoming
         or being declared due and payable prior to the date on which it would
         otherwise have become due and payable, unless and until such event of
         default shall have been cured or waived or shall have ceased to exist
         and such acceleration shall have been rescinded or annulled, or (b) in
         the event any judicial proceeding shall be pending with respect to any
         such default in payment or such event of default, then no payment or
         distribution of any kind or character, whether in cash, properties or
         securities shall be made by the Company on account of the principal of
         or interest on the Note or on account of the purchase or other
         acquisition of the Note by the Company. In the event that,
         notwithstanding the foregoing, the Company shall make any payment to
         the holders of the Note prohibited by this SECTION 4.3, then in such
         event such payment shall be paid over and delivered by each such holder
         forthwith to the holders of Senior Debt.

                  4.4 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT. Subject
         to the payment in full of all Senior Debt, or the provision for such
         payment in cash or cash equivalents or otherwise in a manner
         satisfactory to the holders of Senior Debt, holders of the Note shall
         be subrogated to the extent of the payments or distributions made to

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         the holders of such Senior Debt pursuant to the provisions of this
         SECTION 4 (equally and ratably with the holders of all indebtedness of
         the Company which by its express terms is subordinated to Senior Debt
         of the Company to substantially the same extent as the Note is
         subordinated to the Senior Debt and are entitled to like rights of
         subrogation by reason of any payments or distributions made to holders
         of such Senior Debt) to the rights of the holders of such Senior Debt
         to receive payments and distributions of cash, property and securities
         applicable to the Senior Debt until the principal of and interest on
         the Note shall be paid in full. For purposes of such subrogation or
         assignment, no payments or distributions to the holders of the Senior
         Debt of any cash, property or securities to which the holders of the
         Note would be entitled except for the provisions of this SECTION 4, and
         no payments over pursuant to the provisions of this SECTION 4 to the
         holders of Senior Debt by the holders of the Note, shall, as among the
         Company, its creditors other than holders of Senior Debt, and the
         holders of the Note, be deemed to be a payment or distribution by the
         Company to or on account of the Senior Debt.

                  4.5 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. The
         provisions of this SECTION 4 are intended solely for the purpose of
         defining the relative rights of the holders of the Note on the one hand
         and the holders of Senior Debt on the other hand. Nothing contained in
         this SECTION 4 or elsewhere in the Note is intended to or shall (a)
         impair, as between the Company and the holders of the Note, the
         obligations of the Company, which are absolute and unconditional, to
         pay to the holders the principal of and interest on the Note as and
         when the same shall become due and payable in accordance with their
         terms; or (b) affect the relative rights against the Company of the
         holders of the Note and creditors of the Company other than in relation
         to the holders of Senior Debt; or (c) prevent the holder of the Note
         from exercising all remedies otherwise permitted by applicable law.

                  4.6 NO WAIVER OF SUBORDINATION. No right of any present or
         future holder of any Senior Debt to enforce subordination as herein
         provided shall at any time in any way be prejudiced or impaired by any
         act or failure to act on the part of the Company or by any act or
         failure to act, in good faith, by any such holder, or by any
         noncompliance by the Company with the terms of the Note, regardless of
         any knowledge thereof that any such holder may have or be otherwise
         charged with.

                  4.7 ADDITIONAL SENIOR DEBT. The Company agrees not to (a)
         except as set forth below, create or incur any Debt secured by a lien
         on the properties or assets of the Company or which is otherwise senior
         in right of payment to the obligations represented by this Note, or (b)
         amend, modify, supplement, renew or restate any of its Senior Debt to
         increase the principal amount of such Senior Debt after the date
         hereof, except that the Company shall have the right to (i) draw on its
         existing bank line of credit in the aggregate principal amount of
         $750,000; (ii) enter into loans to lease or purchase furniture,
         fixtures and equipment in the ordinary course of conducting its
         business operations; and (iii) obtain, without any requirement to have
         Holder's consent, debt senior in right of payment to the obligations
         under this Note up to the total aggregate amount of $1,000,000 for
         purposes of making acquisitions of property, assets, businesses or
         business units.

                                       10
<PAGE>

SECTION 5. EVENTS OF DEFAULT.

                  5.1 For purposes of the Note, an Event of Default by the
         Company shall be deemed to have occurred if:

                           (a) the Company fails to pay within five (5) business
                  days after any date on which interest is due, the full amount
                  of interest then accrued on the Note;

                           (b) the Company fails to pay when due the full amount
                  of any principal payment on the Note;

                           (c) the Company fails to file the Registration
                  Statement on Form SB-2 within one hundred twenty (120) days of
                  the Closing Date (as defined in the Securities Purchase
                  Agreement), unless such failure is due to a default by the
                  Holder hereunder;

                           (d) the Company fails to obtain the admission of the
                  shares of Common Stock issuable pursuant to this Note to
                  trading on the NASD OTC Bulletin Board or the Common Stock is
                  delisted therefrom;

                           (e) the Company breaches or otherwise fails to
                  perform or observe the covenants and agreements in this Note,
                  the Securities Purchase Agreement, the Registration Rights
                  Agreement or the Warrant (unless such breach or failure is due
                  to a default by the Holder hereunder), and such breach or
                  failure to perform or observe a covenant or agreement is not
                  cured within 30 days after the receipt of notice thereof
                  delivered to the Company by any holder of the Note;

                           (f) the Company makes an assignment for the benefit
                  of creditors; or an order, judgment or decree is entered
                  adjudicating the Company bankrupt or insolvent; or any order
                  for relief with respect to the Company is entered under the
                  Federal Bankruptcy Code and the Company consents to the order
                  or the order is not dismissed within 30 days after it is
                  entered; or the Company petitions or applies to any tribunal
                  for the appointment of a custodian, trustee, receiver or
                  liquidator of the Company, or of any substantial part of the
                  assets of the Company, or commences any proceeding relating to
                  the Company under any bankruptcy, reorganization, arrangement,
                  insolvency, readjustment of debt, dissolution or liquidation
                  law of any jurisdiction; or any such petition or application
                  is filed, or any such proceeding is commenced, against the
                  Company and (i) the Company does not contest the petition,
                  application or proceeding, or (ii) such petition, application
                  or proceeding is not dismissed or withdrawn within 60 days
                  after it is filed or commenced; or

                           (g) the Company defaults on any Senior Debt, and if
                  such default is other than a default in the payment of
                  principal or interest when due, such default shall have
                  resulted in such Senior Debt becoming or being declared due
                  and payable prior to the date on which it would otherwise have
                  become due and payable.

                                       11
<PAGE>

                  5.2 DEFAULT BY HOLDER.

                           (a) For purposes of the Note, an Event of Default by
                  the Holder shall be deemed to have occurred if:

                                    (i) the Holder fails to surrender the Note
                           within five (5) business days of the date the
                           Conversion Notice is received in connection with the
                           Mandatory Conversion;

                                    (ii) the Holder fails to dividend at least
                           662,000 shares of Common Stock which it would have
                           received in a Mandatory Conversion pursuant to the
                           terms and conditions of SECTION 3.2 hereof; or

                                    (iii) the Holder fails to provide the
                           information required by the Securities and Exchange
                           Commission in order to complete the Registration
                           Statement.

                           (b) Notwithstanding SECTION 5.2(A) above, Holder
                  shall not be deemed to be in default if the default is a
                  result of:

                                    (i) the Company's failure to keep the
                           Registration Statement current, or the effectiveness
                           of the Registration Statement is suspended for more
                           than ten (10) days;

                                    (ii) the Company's failure to honor its
                           covenants in the Securities Purchase Agreement, the
                           Registration Rights Agreement, the Warrant or this
                           Note;

                                    (iii) a current prospectus meeting the
                           requirements of Section 10(a) of the Securities Act
                           of 1933 not being available for delivery by the
                           Holder or a stop order having been issued by the
                           Securities and Exchange Commission with respect to
                           the Registration Statement;

                                    (iv) the Common Stock not being admitted for
                           trading on the NASD OTC Bulletin Board or its
                           delisting therefrom; or

                                    (v) the Company's failure to comply with
                           applicable state securities laws and "blue sky"
                           provisions or the rules and regulations for listing
                           the shares of Common Stock issuable hereunder on the
                           OTC Bulletin Board.

                           (c) For so long as an Event of Default by Holder
                  continues, the Company shall have no obligation to comply with
                  its covenants hereunder pertaining to conversion or redemption
                  of the Note.

                                       12
<PAGE>

                  5.3 ELECTION OF DIRECTORS BY THE HOLDER.

                           (a) In the case of an Event of Default by the
                  Company, upon thirty (30) day's notice, the Holder shall have
                  the right to designate a majority of the members (the "HOLDER
                  DESIGNEES") of the Board of Directors of the Company (the
                  "BOARD") for so long as the principal amount of the Note
                  remains issued and outstanding. Once appointed, the Holder
                  Designees shall be deemed to be the Holder Directors for
                  purposes of this Note. The Holder shall not be required to
                  appoint any representatives to the Board. The Holder, upon an
                  Event of Default by the Company, shall also be entitled to
                  appoint and send an observer (at the expense of the Company)
                  to attend all meetings of the Board, including any committee
                  meetings thereof.

                           (b) For so long as the Note is in default, no Holder
                  Director shall be removed from office without the consent of
                  the Holder. Any Holder Director may be retired from or
                  replaced on the Board at any time, with or without cause, at
                  the request of the Holder.

                           (c) Following an Event of Default by the Company, the
                  Company agrees to cause its Board to (i) include the Holder
                  Designees on the Board's slate of nominees to the Board in the
                  event of an election of the Board and to recommend the Holder
                  Designees to the Company's shareholders for election to the
                  Board in any such election, and (ii) if necessary, to increase
                  the size of the Board so that the Holder Designees can be
                  named or elected to the Board. The undersigned shareholder,
                  Robert S. Limbaugh, Jr., agrees to (and the Company agrees to
                  use its best efforts to cause each of Terry E. Edgerton, John
                  S. Edgerton, Jr. and Robert L. Strickland to agree to) vote
                  all the voting securities of the Company held by him (and each
                  of them) in favor of the election of the Holder Designees for
                  so long as Holder is entitled to designate the Holder
                  Designees to the Company's Board.

SECTION 6. CONSEQUENCES OF EVENTS OF DEFAULT.

                  6.1 The Company shall notify the holders of the Note of the
         occurrence of any Event of Default within five (5) days after such
         Event of Default.

                  6.2 If any Event of Default of the type described in SECTION
         5.1(f) hereof occurs, the entire outstanding principal amount of the
         Note (plus all accrued interest thereon) will automatically accelerate
         and become immediately due and payable without any notice to or action
         by any holder of the Note; PROVIDED, HOWEVER, that after such
         acceleration, but before a judgment or decree has been entered based on
         such acceleration, the holders of a majority in aggregate principal
         amount of the outstanding Note may rescind and annul such acceleration
         if all Events of Default, other than non-payment of accelerated
         principal, have been cured or waived.

                  6.3 If any other Event of Default under SECTION 5.1 has
         occurred and is continuing, any holder of the Note may demand immediate
         payment of all or any portion of the outstanding principal amount of
         the Note. If such holder demands immediate payment of all or any
         portion of the Note, the Company will promptly (but in any event within

                                       13
<PAGE>

         two (2) business days after receipt of such demand) deliver a notice to
         each other holder of the Note, advising such holders of the fact of any
         such demand. Upon any such demand, the principal amount of the Note
         with respect to which such demand is made shall become immediately due
         and payable.

                  6.4 For so long as any Event of Default exists under this
         Note, regardless of whether or not there has been an acceleration of
         the indebtedness evidenced by this Note, and at all times after the
         maturity of the indebtedness evidenced by this Note (whether by
         acceleration or otherwise), and in addition to all other rights and
         remedies of the holders of the Note hereunder, interest shall accrue on
         the outstanding principal balance hereof at the rate of LIBOR plus five
         percent (5%) (the "Default Interest Rate"), and such accrued interest
         shall be immediately due and payable.

                  6.5 The holders of the Note shall also have any other rights
         that such holders may have pursuant to applicable law.

SECTION 7. COVENANTS AND AGREEMENTS. For so long as the Holder beneficially owns
the Note:

                  7.1 PAYMENT OF TAXES AND CLAIMS. The Company will pay and
         discharge or cause to be paid and discharged all Taxes imposed upon the
         income or profits of the Company or upon the property, real, personal
         or mixed, or upon any part thereof, belonging to the Company before the
         same shall be in default, and all lawful claims for labor, rentals,
         materials and supplies which, if unpaid, might become a lien upon its
         property or any part thereof; provided however, that the Company shall
         not be required to pay and discharge or cause to be paid or discharged
         any such Tax, assessment or claim so long as the validity thereof shall
         be contested in good faith by appropriate proceedings, and adequate
         book reserves shall be established with respect thereto, and the
         Company shall pay such Tax, charge or claim before any property subject
         thereto shall become subject to execution.

                  7.2 MAINTENANCE OF CORPORATE EXISTENCE. The Company will do or
         cause to be done all things necessary to preserve and keep in full
         force and effect its corporate existence, rights and franchises and
         will continue to conduct and operate its business substantially as
         being conducted and operated presently. The Company will become and
         remain qualified to conduct business in each jurisdiction where the
         nature of the business or ownership of property by the Company may
         require such qualification.

                  7.3 PRESERVATION OF PROPERTY. The Company will at all times
         maintain, preserve and protect all franchises and trade names and keep
         all the remainder of its properties which are used or useful in the
         conduct of its respective businesses whether owned in fee or otherwise,
         or leased, in good repair and operating condition; from time to time
         make, or cause to be made, all needful and proper repairs, renewals,
         replacements, betterments and improvements thereto so that the business
         carried on in connection therewith may be properly and advantageously
         conducted at all times; and comply with all material leases to which it
         is a party or under which it occupies property so as to prevent any
         material loss or forfeiture thereunder.

                                       14
<PAGE>

                  7.4 INSURANCE. The Company will keep or cause to be kept
         adequately insured by financially sound and reputable insurers its
         shops, equipment, motor vehicles, and all other property of a character
         usually insured by businesses engaged in the same or similar
         businesses. The Company shall at all times maintain adequate insurance
         against damage to persons or property, which insurance shall be by
         financially sound and reputable insurers and shall, without limitation,
         provide the following coverages: comprehensive general liability
         (including, without limitation, coverage, where applicable, for damage
         caused by explosion, broad form property damage coverage, broad form
         coverage for contractually independent contractors), worker's
         compensation, products liability and automobile liability.

                  7.5 COMPLIANCE WITH APPLICABLE LAWS. The Company will comply
         with the requirements of all applicable laws and orders of any
         Governmental Authority and obtain any licenses, permits, franchises or
         other governmental authorizations necessary to the ownership of its
         properties or to the conduct of its business.

                  7.6 FINANCIAL REPORTS. The Company will prepare and deliver
         the financial reports required by the Securities Purchase Agreement (as
         defined below).

SECTION 8. DEFINITIONS. For purposes of this Note:

         "DEBT" means the principal of (and premium if any) and interest, if any
on, and other obligations in respect of, the following, whether incurred on or
prior to the date of the Note: (i) every obligation of the Company and/or its
Subsidiaries for money borrowed (including the Note); (ii) every obligation of
the Company and/or its Subsidiaries evidenced by bonds, debentures, notes or
other similar instruments, including obligations incurred in connection with the
acquisition of property, assets or businesses; (iii) every reimbursement
obligation of the Company and/or its Subsidiaries with respect to letters of
credit, bankers' acceptances or similar facilities issued for the account of the
Company and/or its Subsidiaries; (iv) every obligation of the Company and/or its
Subsidiaries issued or assumed as the deferred purchase price of property or
service (but excluding trade payables or accrued liabilities arising in the
ordinary course of business); (v) capitalized lease obligations of the Company
and/or its Subsidiaries; and (vi) every obligation of the type referred to in
clauses (i) through (v) of another person the payment of which the Company
and/or its Subsidiaries has guaranteed or for which the Company and/or its
Subsidiaries is responsible or liable, directly or indirectly, as obligor or
otherwise; PROVIDED, that Debt shall not be deemed to include any indebtedness
or other monetary obligations to trade creditors created or assumed by the
Company in the ordinary course of business in connection with the obtaining of
goods, materials or services.

         "GOVERNMENTAL AUTHORITY" means any nation or government, any state or
political subdivision thereof, any federal or state court and any other agency,
body, authority or entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.

         "MARKET PRICE" per share of Common Stock means, (i) on any date prior
to the commencement of trading of the Common Stock on the NASDAQ SmallCap Market
or the NASD OTC Bulletin Board, the greater of $0.75 or the fair market value of

                                       15
<PAGE>

the Common Stock on a fully diluted basis, as determined in good faith by the
Board of Directors, whose determination shall be conclusive; and (ii) on any
date after the commencement of trading of the Common Stock on the NASDAQ
SmallCap Market or the NASD OTC Bulletin Board, the weighted average daily
trading prices per share of Common Stock over the previous 10 business days on
the principal securities exchange on which the Common Stock is then listed for
trading or the principal quotation system on which transactions in the Common
Stock are then quoted.

         "PERSON" means any individual, corporation, limited liability company,
partnership, association, trust or any other entity or organization of any kind
or character, including any Governmental Authority.

         "SECURITIES PURCHASE AGREEMENT" means the securities purchase agreement
and a related Registration Rights Agreement, both of even date herewith, which,
among other matters, require the Company to prepare and file the Registration
Statement (as defined in SECTION 2.1) to sell to the public the shares of Common
Stock issuable upon conversion of this Note or exercise of the Warrant.

         "SENIOR DEBT" means the principal of (and premium if any) and interest,
if any (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company, whether or not such
claim for post-petition interest is allowed in such Proceeding) on, and other
obligations in respect of, the following, whether incurred on or prior to the
date of the Note: (i) every obligation of the Company and/or its Subsidiaries
for money borrowed (excluding the Note); (ii) every obligation of the Company
and/or its Subsidiaries evidenced by bonds, debentures, notes or other similar
instruments, including obligations incurred in connection with the acquisition
of property, assets or businesses; (iii) every reimbursement obligation of the
Company and/or its Subsidiaries with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of the Company and/or
its Subsidiaries; (iv) every obligation of the Company and/or its Subsidiaries
issued or assumed as the deferred purchase price of property or service (but
excluding trade payables or accrued liabilities arising in the ordinary course
of business); (v) capitalized lease obligations of the Company and/or its
Subsidiaries and (vi) every obligation of the type referred to in clauses (i)
through (v) of another person the payment of which the Company and/or its
Subsidiaries has guaranteed or for which the Company and/or its Subsidiaries is
responsible or liable, directly or indirectly, as obligor or otherwise;
PROVIDED, that, Senior Debt shall not be deemed to include (a) any indebtedness
or obligation of the Company which when incurred, and without respect to any
election under Section 1111(b) of the Bankruptcy Code, was without recourse to
the Company, (b) any indebtedness or obligation of the Company to any of its
Subsidiaries or employees, (c) any liability for taxes, (d) any indebtedness or
other monetary obligations to trade creditors created or assumed by the Company
in the ordinary course of business in connection with the obtaining of goods,
materials or services, (e) every obligation of the type referred to in clauses
(i) through (v), if the instrument creating or evidencing the same or pursuant
to which the same is outstanding, provides that such obligation is not superior
in right of payment to the Note or to other obligations which are PARI PASSU
with, or subordinated to, the Note, and (f) the Note.

         "SUBSIDIARY" means, with respect to any Person, (i) any corporation,
partnership or other entity of which shares of capital stock or other ownership
interests having ordinary voting power to elect a majority of the board of
directors or other similar managing body of such corporation, partnership or

                                       16
<PAGE>

other entity are at the time owned by such Person, or (ii) the management of
which is otherwise controlled, directly or indirectly, through one or more
intermediaries by such Person.

         "TAXES" means all taxes, charges, fees, levies or other assessments
(including, but not limited to, income, gross receipts, excise, property, sales,
occupation, use, service use, license, payroll, franchise, transfer, production,
severance, ad valorem, windfall profits, and recording taxes, tariffs, duties,
fees and charges) imposed by any Governmental Authority, whether computed on a
separate, consolidated, unitary or combined basis or in any other manner, and
includes any interest, penalties and additions to any tax.

         "WARRANT" means the warrant to be issued by the Company to the Holder,
giving the Holder the right to purchase up to 1,059,660 shares of Common Stock
at an exercise price of $2.1233 per share, subject to adjustment as provided
therein.

SECTION 9. PAYMENTS.

         If any payment of principal or interest on this Note becomes due on a
Saturday, Sunday or a bank or legal holiday under the laws of the State of
Texas, such payment will be made on the next succeeding business day and such
extension of time will in such case be included in computing interest in
connection with such payment. Any payment to be made hereunder will be made at
the direction of the Holder hereof by wire transfer of immediately available
federal funds to an account designated by the Holder.

SECTION 10. AMENDMENT AND WAIVER.

         Except as otherwise expressly provided herein, the provisions of the
Note may not be amended, and the Company may not take any action herein
prohibited, without the prior written consent of the holders of 80% of the
aggregate principal amount of the outstanding Note.

SECTION 11. PLACE OF PAYMENT AND NOTICES.

         Payments of principal and interest, and notices hereunder, are to be
delivered to the Holder at the following address:

                           Calton, Inc.
                           2013 Indian River Blvd.
                           Vero Beach, FL  32906
                           Attention: Anthony J. Caldarone, President

With a copy to:

                           Philip D. Forlenza
                           Giordano, Halleran & Ciesla, P.C.
                           P.O. Box 190
                           Middletown, New Jersey 07748

                                       17
<PAGE>

SECTION 12. USURY LAWS.

         It is the intention of the Company and the holders of the Note to
conform strictly to all applicable usury laws now or hereafter in force, and any
interest payable under the Note will be subject to reduction to the amount not
in excess of the maximum legal amount allowed under the applicable usury laws as
now or hereafter construed by the courts having jurisdiction over such matters.
The aggregate of all interest (whether designated as interest, service charges,
points or otherwise) contracted for, chargeable or receivable under the Note
will under no circumstances exceed the maximum legal rate upon the unpaid
principal balance of the Note remaining unpaid from time to time. If such
interest does exceed the maximum legal rate, it will be deemed a mistake and
such excess will be canceled automatically and, if theretofore paid, rebated to
the Company or credited on the principal amount of the Note, or if the Note has
been repaid, then such excess will be rebated to the Company.

SECTION 13. SEVERABILITY; WAIVER OF NOTICE.

         Whenever possible, each provision of the Note will be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of the Note is held to be prohibited by or invalid under applicable
law in any jurisdiction, such provision will be ineffective only to the extent
of such prohibition or invalidity, without invalidating any other provision of
the Note. To the extent permitted by law, the Company hereby waives presentment,
demand, notice of protest and all other demands and notices, in connection with
the delivery, acceptance, performance, default or enforcement of the Note.

SECTION 14. ENTIRE AGREEMENT; CONFLICT.

         This Note, along with the Securities Purchase Agreement, the Warrant
and the Registration Rights Agreement (and any documents, exhibits and schedules
referenced in any of them), constitute the entire agreement and understanding
between the parties with respect to the transactions contemplated hereby and
thereby and cancel, merge and supersede all prior oral or written agreements,
representations and warranties, arrangements and understandings relating to the
subject matter hereof and thereof. In the event of a conflict between this Note
and any of the other agreements with regard to the subject matter hereof, this
Note shall be the controlling document.

SECTION 15. TRANSFERABILITY OF THE NOTE.

         The Note may not be transferred or assigned, in whole or in part, by
the Company or the Holder without the prior written consent of the other party
hereto, except that no consent shall be required for the Company to transfer the
obligations of this Note in connection with the series of mergers planned with
Bodark Technology Corporation, as described in the Securities Purchase
Agreement; PROVIDED THAT such mergers do not adversely affect the rights of the
Holder under this Note.

                                       18
<PAGE>

SECTION 16. GOVERNING LAW.

         THE NOTE IS BEING DELIVERED AND IS INTENDED TO BE PERFORMED IN THE
STATE OF TEXAS AND WILL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF
SUCH STATE.

                                   COMPANY:

                                   AUTOMATED INFORMATION MANAGEMENT, INC.

                        By:______________________________________________
                                                Robert S. Limbaugh, Jr.
                                                President

                          With respect to the provisions of SECTION 5.3(c) only:

                          -----------------------------------------------
                          Robert S. Limbaugh, Jr., in his individual capacity as
                          a shareholder

                                       19<PAGE>

                                  EXHIBIT 10.1

                            BIO-LOK INTERNATINAL INC.
                          STOCK COMPENSATION PLAN 2002

This STOCK COMPENSATION PLAN, dated the 2nd day of January, 2002, is herewith
established by Bio-Lok Internaitonal Inc., a Delaware corporation, located at
312 S. Military Trail, Deerfield Beach, Florida 33442 (hereinafter "Company")
for the purpose of providing a stock compensation plan for its employees, and
for the issue of common stock as compensation to other entities and clinicians
for services provided to the Company.

                                    PREAMBLE

WHEREAS, the Company desires to have set aside 150,000 shares of common stock
for use by the Company in compensating employee(s) for exceptional service and
for support of the company; and,

WHEREAS, the Company desires to have set aside 200,000 common stock shares for
use by the Company for issue of common stock awarded under its "Bio-Lok 401(k)
Plan" (the "Plan") for years beginning with 2000; and,

WHEREAS, the Company desires to have set aside 150,000 common stock shares for
use by the Company for the use and issue to institutions, consultants or other
entities common stock shares as compensation for services rendered.

NOW, THEREFORE, the Board of Directors have authorized and approved per attached
Resolutions the issue of this Stock Compensation Plan and related Form S-8 for
500,000 shares of common stock of Bio-Lok Internaitonal Inc.

1.       EMPLOYEE COMPENSATION.

         a.       Employee compensation can be awarded for exceptional service
                  and for support of the company.

         b.       The award(s) can to be based on specific instances or on
                  subjective basis. The awards are to be submitted to management
                  in writing for presentation and approval of the Company's
                  Compensation Committee.

         c.       Upon approval of an award by the Board of Directors
                  Compensation Committee the officers of the company are
                  directed and authorized to have the required shares issued.

2.       BIO-LOK 401(K) PLAN.

         a.       The company on 1/01/97 established a 401(k) Plan and the Plan
                  is maintained by a Plan Administrator designated by the
                  Company. It is the Plan Administrator's responsibility to
                  administer and manage the plan on behalf of the Company.

<PAGE>

         b.       The Plan permits the Company to award matching funds. Matching
                  funds can be granted and awarded up to 50% of the first 10% of
                  contributions.

         c.       The Board of Directors must approve each annual distribution.
                  To date, the Board of Directors have approved the maximum
                  allowable distribution of common stock for the year 2000 and
                  2001 (see Exhibit Index).

         d.       Authorization of distributions under the Plan must be attached
                  to this Compensation Plan and listed on the Exhibit Index,
                  which is to be updated as necessary. The items attached are to
                  consist of a copy of the Board of Directors Resolution issued.

3.       INSTITUTIONS, CONSULTANTS AND OTHER ENTITIES.

         a.       The Company and its officers in managing the business may from
                  time to time appoint institutions, consultants or other
                  entities (hereinafter the "entities") for providing services
                  to the Company. These entities appointed to perform select
                  services may in part or whole be compensated by the Company
                  utilizing common stock.

         b.       Entities contracted for by the company shall and must be
                  identified as independent contractors. Further, any agreement
                  entered into by the Company with contractor(s) cannot
                  establish any partnership, joint venture, or other business
                  combination between an entity and the Company.

         c.       No stock shares can be issued to an entity until the
                  parameters of their contract(s) have been met.

         d.       Contracts with services rendered to be paid utilizing common
                  stock of the Company must be accomplished only for legitimate
                  and valid reasons as detailed and authorized under the Federal
                  Security Laws of the United States.

         e.       Each entity appointed must enter into an agreement with the
                  Company and such agreement is to be detailed on the Exhibit
                  Index, which is to be updated as necessary.

4.       DUTIES OF OFFICERS.

         a.       Upon approval of an award by the Board of Directors the
                  officers of the corporation is directed to have the
                  appropriate shares issued to the respective individual and/or
                  entity(s).

         b.       All modifications and additions to this Plan are to be
                  detailed in writing as an amendment to the Plan. Said
                  amendments to the Plan must be detailed under the Exhibit
                  Index section of this Plan.

                                       2
<PAGE>
         c.       Once all authorized shares of the Plan have been issued, the
                  officers are to inform the Board of Directors accordingly, in
                  order that, added shares can be authorized under this Plan.
                  All added shares to be authorized under the Plan must be
                  approved by the Board of Directors and subsequently registered
                  via another Form S-8.

5.       ENTIRE AGREEMENT.

This document represents the entire agreement of the Stock Compensation Plan of
the Company and may be modified only in writing based on parameters approved by
its Board of Directors.

IN WITNESS WHEREOF, the Officers of the Bio-Lok International Inc. have executed
this Stock Compensation Plan.

      BIO-LOK INTERNATIONAL INC.

By: /s/  Bruce L. Hollander
    ---------------------------------------------
       Bruce L. Hollander, President and CEO

By: /s/  Ingo K. Kozak
    ---------------------------------------------
      Ingo K. Kozak, VP-Finance & Admin. and CFO

                                       3

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