Document:

<PAGE>
                                                                    Exhibit 10.1

                               LIGHTBRIDGE, INC.
                 AMENDMENT TO 1996 INCENTIVE AND NON-QUALIFIED
                               STOCK OPTION PLAN
                          EFFECTIVE: FEBRUARY 7, 2001

    The Lightbridge, Inc. 1996 Incentive and Non-Qualified Stock Option Plan is
hereby further amended as follows:

    The number "2,350,000" in the second sentence of Section 3.1 is hereby
deleted and the number "4,350,000" is inserted in its place and stead.<PAGE>

                                                                  EXHIBIT 10.1

                        AMENDMENT TO DISTRIBUTION AGREEMENT

     1.  PARTIES AND BACKGROUND. This agreement (this "Agreement") is entered
into as of January 1, 2001 by Inverness Medical Technology, Inc. (formerly
named Selfcare, Inc., and referred to in this agreement as "Selfcare") and
LifeScan, Inc. ("LifeScan") for the purpose of amending the Amended and
Restated Sales Distribution Agreement (the "Distribution Agreement") between
them made as of June 7, 1999. Capitalized terms used in this Agreement and
not otherwise defined are used with the meanings in the Distribution
Agreement. The Distribution Agreement is amended only with respect to the
terms set forth below.

     Selfcare and LifeScan desire to increase the volume of LS Instruments
distributed to users of glucose measuring systems. LifeScan is prepared to
commit to purchase a minimum quantity of LS Instruments in 2001 and to
distribute them on the terms and conditions specified in this Agreement.
Selfcare is prepared to offer special pricing on such LS Instruments in order
to obtain such commitment from LifeScan. Each of Selfcare and LifeScan, in
consideration of the agreements of the other contained in this Agreement,
agree as provided herein.

     2. LIFESCAN AGREEMENT TO PURCHASE. Subject to the qualifications set
forth below in this Section 2, LifeScan agrees to purchase from Selfcare   *
 LS Instruments during calendar year 2001. Unless otherwise agreed, Selfcare
shall ship   *   meters in each calendar quarter of the types Selfcare
determines in good faith to be most likely to meet user demand. LifeScan may
request alternate reasonable delivery times and reasonable allocation of the
purchase order among different types of meters (FastTake, One Touch Ultra or
*), and Selfcare agrees to make reasonable efforts to accommodate
LifeScan's requests. The foregoing shall not, however, affect the firm nature
of LifeScan's agreement to purchase as provided above in this paragraph. This
amendment will serve as the purchase order for such instruments on the terms
and conditions indicated in the Distribution Agreement as amended by this
Agreement, except that LifeScan may not withdraw or modify this purchase
order other than as provided below in this Section 2. This Purchase Order
replaces LifeScan's outstanding purchase order with respect to any LS
Instruments delivered or to be delivered in calendar year 2001. Meters
already shipped by Selfcare in calendar year 2001 shall be deemed to be
shipped pursuant to this purchase order, and the pricing terms specified
herein shall apply to such meters.

     The LS Instruments purchased by LifeScan under this Section 2 and
Section 7 shall be shipped in kits pursuant to the separate agreement (the
"IML Agreement") between LifeScan and Inverness Medical Limited ("IML") dated
May 1, 2000, and Selfcare agrees to cause IML to so ship. LifeScan shall be
responsible for the separate charges payable to IML under that agreement. If
IML fails to ship kits containing the LS Instruments consistent with the
requirements of the preceding paragraph, then, unless such failure was caused
by LifeScan's failure to timely supply information or materials as
contemplated by the IML Agreement or as otherwise reasonably requested by
IML, LifeScan shall not be obligated to purchase the LS Instruments which
were not timely shipped.

     3. LIFESCAN COMMITMENT TO DISTRIBUTE. LifeScan agrees that at the end
of calendar year 2001, its inventory of LS Instruments shall not exceed   *
instruments. During calendar year 2001, LifeScan agrees to ship into its
customary distribution channels all of the LS Instruments which LifeScan has
purchased other than those which it is permitted to have in inventory as of
the end of calendar year 2001 pursuant to the preceding sentence. If
requested by Selfcare, LifeScan shall certify to Selfcare such information as
Selfcare may reasonably request to confirm compliance with this requirement.

     4. MINIMUM STRIP PURCHASES IN 2001. Notwithstanding anything to the
contrary in Section 4.4 of the Distribution Agreement, the Yearly Minimum of
LS Strips shall be    *   for calendar year 2001.

     5. PRICING FOR LS INSTRUMENTS PURCHASED PURSUANT TO SECTION 2. Except as
provided in Sections 6 and 7 below and in this Section 5, the pricing for LS
Instruments specified in the Distribution Agreement shall remain in

---------------------
* Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.

                                      1

<PAGE>

effect. Except as provided in Section 6 and below in this Section 5, (i) the
unit price for the first   *   LS Instruments shipped pursuant to Section 2
shall be $ *   , (ii) the unit price for the second    *   LS Instruments
shipped pursuant to Section 2 will be $ *   , (iii) the unit price for the
third   *   LS Instruments shipped pursuant to Section 2 will be $ *    and
(iv) the unit price for the fourth   *   LS Instruments shipped pursuant to
Section 2 will be $ *   . If Selfcare, through no fault of LifeScan, fails to
deliver any portion of the   *   LS Instruments contemplated by the preceding
sentence during calendar year 2001, it shall make a payment to LifeScan in an
amount sufficient to reduce the weighted average price per LS Instrument paid
by LifeScan for the units which Selfcare did deliver in 2001 to $ *   . Any
such payment will be paid by February 28, 2002.

     6. PRICING FOR FASTTAKE LS INSTRUMENTS IN 2001. The price for any
FastTake LS Instruments purchased by LifeScan in calendar year 2001 in excess
of   *   units will be $ *   more per unit than the unit price otherwise
applicable.

     7. BLOCK PURCHASES OF ADDITIONAL LS INSTRUMENTS IN 2001. If LifeScan
wishes to purchase LS Instruments in 2001 beyond those contemplated by
Section 2 above, and is prepared to do so in blocks of    *    units each, it
may purchase the first block of   *   of such additional units for the
purchase price of $ *   per unit (subject to adjustment as provided below in
this Section 7) so long as it gives Selfcare at least six (6) months' prior
written notice of its desired delivery date in 2001. If LifeScan exercises
its right pursuant to the preceding sentence and wishes to purchase yet
additional LS Instruments in 2001 in blocks of   *   units each, it may do so
at a purchase price of $ *   per unit so long as it gives Selfcare at least
six (6) months' prior written notice of its desired delivery date in 2001. If
LifeScan increases its binding purchase order for LS Strips in 2001 pursuant
to procedures for ordering specified in the Distribution Agreement to an
amount greater than   *   LS Strips, the purchase price for the first block
of   *   LS Instruments referred to above in this Section 7 shall be reduced
from $ *   per unit to $ *   per unit.

     8. INTRODUCTION OF COMPETING ELECTROCHEMICAL SYSTEM. Unless Selfcare
fails to exercise commercially reasonable efforts to supply LS Instruments as
provided in this Agreement, if there is a Market Introduction on or before
December 31, 2002 anywhere in the world by LifeScan or any Affiliate of
LifeScan of any electrochemical testing system designed to be capable of home
use to measure glucose in humans and which is not supplied by Selfcare, the
restrictions set forth in Section 4.1(b) and Section 4.1(c) of the
Distribution Agreement shall terminate and thereafter Selfcare shall be free
to sell Complete System Products and/or Test Strips, in each case, other than
Compatible Products, anywhere in the world.

     9. AGREEMENT TO REMAIN IN EFFECT. As amended hereby, the Distribution
Agreement remains in full force and effect.

                             INVERNESS MEDICAL TECHNOLOGY, INC.

                             By: /s/ Ron Zwanziger
                                 ---------------------------------------------
                                 Ron Zwanziger, its President

                             Date: 2/20/01
                                   -------------------------------------------

                             LIFESCAN, INC.

                             By: /s/ Eric P. Milledge
                                 ---------------------------------------------
                                 Eric P. Milledge, its Company Group Chairman

                             Date: 02/16/01
                                   -------------------------------------------

-----------------
* Omitted pursuant to a request for confidential treatment. The omitted
material has been separately filed with the Securities and Exchange
Commission.

                                      2<PAGE>

                                                                   EXHIBIT 10.51

                                 LOAN AGREEMENT

<TABLE>
<CAPTION>

--------------------- --------------- -------------- ----------- -------- -------------- --------------- ---------- -----------
     PRINCIPAL          LOAN DATE       MATURITY      LOAN NO.    CALL     COLLATERAL       ACCOUNT       OFFICER    INITIALS
--------------------- --------------- -------------- ----------- -------- -------------- --------------- ---------- -----------
<S>                   <C>             <C>            <C>         <C>      <C>            <C>             <C>        <C>
   $10,000,000.00       09-30-2000     06-01-2001                 13178        040         1735058640      EAM13
--------------------- --------------- -------------- ----------- -------- -------------- --------------- ---------- -----------
</TABLE>

References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item.

BORROWER: TRANSCRYPT INTERNATIONAL, INC.  LENDER: U.S. BANK NATIONAL ASSOCIATION
          4800 NW 1ST STREET                      233 SOUTH 13TH STREET
          LINCOLN, NE 68521                       LINCOLN, NE 68508

THIS LOAN AGREEMENT BETWEEN TRANSCRYPT INTERNATIONAL, INC. ("BORROWER") AND U.S.
BANK NATIONAL ASSOCIATION ("LENDER") IS MADE AND EXECUTED ON THE FOLLOWING TERMS
AND CONDITIONS. BORROWER HAS RECEIVED PRIOR COMMERCIAL LOANS FROM LENDER OR HAS
APPLIED TO LENDER FOR A COMMERCIAL LOAN OR LOANS AND OTHER FINANCIAL
ACCOMMODATIONS, INCLUDING THOSE WHICH MAY BE DESCRIBED ON ANY EXHIBIT OR
SCHEDULE ATTACHED TO THIS AGREEMENT. ALL SUCH LOANS AND FINANCIAL
ACCOMMODATIONS, TOGETHER WITH ALL FUTURE LOANS AND FINANCIAL ACCOMMODATIONS FROM
LENDER TO BORROWER, ARE REFERRED TO IN THIS AGREEMENT INDIVIDUALLY AS THE "LOAN"
AND COLLECTIVELY AS THE "LOANS." BORROWER UNDERSTANDS AND AGREES THAT: (A) IN
GRANTING, RENEWING, OR EXTENDING ANY LOAN, LENDER IS RELYING UPON BORROWER'S
REPRESENTATIONS, WARRANTIES, AND AGREEMENTS, AS SET FORTH IN THIS AGREEMENT; (B)
THE GRANTING, RENEWING, OR EXTENDING OF ANY LOAN BY LENDER AT ALL TIMES SHALL BE
SUBJECT TO LENDER'S SOLE JUDGMENT AND DISCRETION; AND (C) ALL SUCH LOANS SHALL
BE AND SHALL REMAIN SUBJECT TO THE FOLLOWING TERMS AND CONDITIONS OF THIS
AGREEMENT.

TERM. This Agreement shall be effective as of September 30, 2000, and shall
continue thereafter until all Indebtedness of Borrower to Lender has been
performed in full and the parties terminate this Agreement in writing.

DEFINITIONS. The following words shall have the following meanings when used in
this Agreement. Terms not otherwise defined in this Agreement shall have the
meanings attributed to such terms in the Uniform Commercial Code. All references
to dollar amounts shall mean amounts in lawful money of the United States of
America.

          AGREEMENT. The word "Agreement" means this Loan Agreement, as this
          Loan Agreement may be amended or modified from time to time, together
          with all exhibits and schedules attached to this Loan Agreement from
          time to time.

          ACCOUNT. The word "Account" means a trade account, account receivable,
          or other right to payment for goods sold or services rendered owing to
          Borrower (or to a third party grantor acceptable to Lender).

          ACCOUNT DEBTOR. The words "Account Debtor" mean the person or entity
          obligated upon an Account.

          ADVANCE. The word "Advance" means a disbursement of Loan funds under
          this agreement.

          BORROWER. The word "Borrower" means Transcrypt International, Inc. The
          word Borrower also includes, as applicable, all subsidiaries and
          affiliates of Borrower as provided below in the paragraph titles
          "Subsidiaries and Affiliates."

<PAGE>

          BORROWING BASE. The words "Borrowing Base" mean the $10,000,000.00
          operating line will first be secured by two U.S. Bank $5,000,000.00
          Certificates of Deposit, then with the $2,500,000.00 Letter of Credit
          Line, secured by 70% of eligible accounts receivable and 35% of
          eligible inventory. Eligible accounts receivable shall mean trade
          receivables with a maximum age of 90 days, including foreign
          receivables that are covered by foreign credit insurance or letters of
          credit. Eligible inventory shall mean raw materials and finished goods
          inventory that are not included in the Company's own reserve for
          obsolete inventory.

          CERCLA. The word "CERCLA" means the Comprehensive Environmental
          Response, Compensation, and Liability Act of 1980, as amended.

          CASH FLOW. The words "Cash Flow" mean net income after taxes, and
          exclusive of extraordinary gains and income, plus depreciation and
          amortization.

          COLLATERAL. The word "Collateral" means and includes without
          limitation all property and assets granted as collateral security for
          a Loan, whether real or personal property, whether granted directly or
          indirectly, whether granted now or in the future, and whether granted
          in the form of a security interest, mortgage, deed of trust,
          assignment, pledge, chattel mortgage, chattel trust, factor's lien,
          equipment trust, conditional sale, trust receipt, lien, charge, lien
          or title retention contract, lease or consignment intended as a
          security device, or any other security or lien interest whatsoever,
          whether created by law, contract, or otherwise. The word "Collateral"
          includes without limitation all collateral described below in the
          section titled "COLLATERAL."

          DEBT. The word "Debt" means all of Borrower's liabilities excluding
          Subordinated Debt.

          ELIGIBLE ACCOUNTS. The words eligible accounts mean, at any time, all
          of the Borrower's Accounts which contain selling terms and conditions
          acceptable to lender. The net amount of any Eligible Account against
          which Borrower may borrow shall exclude all returns, discounts,
          credits, and offsets of any nature. Unless otherwise agreed to by
          Lender in writing, Eligible Accounts do not include:

               (a)  Accounts with respect to which the Account Debtor is an
                    officer, and employee or agent of Borrower.
               (b)  Accounts with respect to which the Account Debtor is a
                    subsidiary of, or affiliated with or related to the Borrower
                    or its shareholders, officers, or directors.
               (c)  Accounts with respect to which goods are placed on
                    consignment, guaranteed sale, or other terms by reason of
                    which the payment by the Account Debtor may be conditional.
               (d)  Accounts with respect to which the Account Debtor is not a
                    resident of the United States, except to the extent such
                    Accounts are supported by insurance, bonds or other
                    assurances satisfactory to Lender.
               (e)  Accounts with respect to which Borrower is or may become
                    liable to the Account Debtor for goods sold or services
                    rendered by the Account Debtor to Borrower.
               (f)  Accounts which are subject to dispute, counterclaim, or
                    setoff.

<PAGE>

               (g)  Accounts with respect to which the goods have not been
                    shipped or delivered, or the services have not been
                    rendered, to the Account Debtor.
               (h)  Accounts with respect to which Lender, in its sole
                    discretion, deems the creditworthiness or financial
                    condition of the Account Debtor to be unsatisfactory.
               (i)  Accounts of any Account Debtor who has filed or who has had
                    filed against it a petition in bankruptcy or an application
                    for relief under any provision of any state or federal
                    bankruptcy, insolvency, or debtor-in-relief acts; or who has
                    had appointed a trustee, custodian, or receiver for the
                    assets of such Account Debtor; or who made an assignment for
                    the behalf of creditors or has become insolvent or fails
                    generally to pay its debts (including its payroll) as such
                    debt comes due.
               (j)  Accounts with respect to which the Account Debtor is the
                    United States government or any department or agency of the
                    United States.

          ELIGIBLE INVENTORY. The words "Eligible Inventory" mean, at any time,
          all of the Borrower's Inventory as defined below except:
               (a)  Inventory which is not owned by Borrower free and clear of
                    all security interests, liens, encumbrances, and claims of
                    third parties.
               (b)  Inventory which Lender, in its sole discretion, deems to be
                    obsolete, unsalable, damaged, defective, or unfit for
                    further processing.

          ERISA. The word "ERISA" means the Employee Retirement Income Security
          Act of 1974, as amended.

          EVENT OF DEFAULT. The words "Event of Default" mean and include
          without limitation any of the Events of Default set forth below in the
          section titled "EVENTS OF DEFAULT."

          GRANTOR. The word "Grantor" means and includes without limitation each
          and all of the persons or entities granting a Security Interest in any
          Collateral for the Indebtedness, including without limitation all
          Borrowers granting such a Security interest.

          GUARANTOR. The word "Guarantor" means and includes without limitation
          each and all of the guarantors, sureties, and accommodation parties in
          connection with any Indebtedness.

          INDEBTEDNESS. The word "Indebtedness" means and includes without
          limitation all Loans, together with all other obligations, debts and
          liabilities of Borrower to Lender, or any one or more of them, whether
          now or hereafter existing, voluntary or involuntary, absolute or
          contingent, liquidated or unliquidated; whether Borrower may be liable
          individually or jointly with others; whether Borrower may be obligated
          as a guarantor, surety, or otherwise; whether recovery of the
          indebtedness may be or hereafter may become barred by any statute of
          limitations; and whether such indebtedness may be or hereafter become
          otherwise unenforceable.

          INVENTORY. The word "Inventory" means all of Borrower's raw materials,
          work in process, finished goods, merchandise, parts and supplies, of
          every kind and description, and goods held for sale or lease or
          furnished under contracts of service in which Borrower now has or
          hereafter acquires any

<PAGE>

          right, whether held by Borrower or others, and all documents of title,
          warehouse receipts, bills of lading, and all other documents of every
          type covering all or any part of the foregoing. Inventory includes
          inventory temporarily out of Borrower's custody or possession and all
          returns on Accounts.

          LENDER. The word "Lender" means U.S. Bank National Association, its
          successors and assigns.

          LINE OF CREDIT. The words "Line of Credit" mean the credit facility
          described in the section titled "LINE OF CREDIT" below.

          LIQUID ASSETS. The words "Liquid Assets" mean Borrower's cash on hand
          plus Borrower's readily marketable securities.

          LOAN. The word "Loan" or "Loans" means and includes without limitation
          any and all commercial loans and financial accommodations from Lender
          to Borrower, whether now or hereafter existing, and however evidenced,
          including without limitation those loans and financial accommodations
          described herein or described on any exhibit or schedule attached to
          this Agreement from time to time.

          NOTE. The word "Note" means and includes without limitation Borrower's
          promissory note or notes, if any, evidencing Borrower's Loan
          obligations in favor of Lender, as well as any substitute, replacement
          or refinancing note or notes therefor.

          PERMITTED LIENS. The words "Permitted Liens" mean: (a) liens and
          security interests securing indebtedness owed by Borrower to Lender;
          (b) liens for taxes, assessments, or similar charges either not yet
          due or being contested in good faith; (c) liens of materialmen,
          mechanics, warehousemen, or carriers, or other like liens arising in
          the ordinary course of business and securing obligations which are not
          yet delinquent; (d) purchase money liens or purchase money security
          interests upon or in any property acquired or held by Borrower in the
          ordinary course of business to secure indebtedness outstanding on the
          date of this Agreement or permitted to be incurred under the paragraph
          of this Agreement titled "Indebtedness and Liens"; (e) liens and
          security interests which, as of the date of this Agreement, have been
          disclosed to and approved by the Lender in writing; and (f) those
          liens and security interests which in the aggregate constitute an
          immaterial and insignificant monetary amount with respect to the net
          value of Borrower's assets.

          RELATED DOCUMENTS. The words "Related Documents" mean and include
          without limitation all promissory notes, credit agreements, loan
          agreements, environmental agreements, guaranties, security agreements,
          mortgages, deeds of trust, and all other instruments, agreements and
          documents, whether now or hereafter existing, executed in connection
          with the Indebtedness.

          SECURITY AGREEMENT. The words "Security Agreement" mean and include
          without limitation any agreements, promises, covenants, arrangements,
          understandings or other agreements, whether created by law, contract,
          or otherwise, evidencing, governing, representing, or creating a
          Security Interest.

<PAGE>

          SECURITY INTEREST. The words "Security Interest" mean and include
          without limitation any type of collateral security, whether in the
          form of a lien, charge, mortgage, deed of trust, assignment, pledge,
          chattel mortgage, chattel trust, factor's lien, equipment trust,
          conditional sale, trust receipt, lien or title retention contract,
          lease or consignment intended as a security device, or any other
          security or lien interest whatsoever, whether created by law,
          contract, or otherwise.

          SARA. The word "SARA" means the Superfund Amendments and
          Reauthorization Act of 1986 as now or hereafter amended.

          SUBORDINATED DEBT. The words "Subordinated Debt" mean Indebtedness and
          liabilities of Borrower which have been subordinated by written
          agreement to indebtedness owed by Borrower to Lender in form and
          substance acceptable to Lender.

          TANGIBLE NET WORTH. The words "Tangible Net Worth" mean Borrower's
          total assets excluding all intangible assets (i.e., goodwill,
          trademarks, patents, copyrights, organizational expenses, and similar
          intangible items, but including leaseholds and leasehold improvements)
          less total Debt.

          WORKING CAPITAL. The words "Working Capital" mean Borrower's current
          assets, excluding prepaid expenses, less Borrower's current
          liabilities.

LINE OF CREDIT. Lender agrees to make Advances to Borrower from time to time
from the date of this agreement to the Expiration Date, provided the aggregate
amount of such Advances outstanding at any time does not exceed the Borrowing
Base. Within the foregoing limits, Borrower may borrow, partially or wholly
prepay, and reborrow under this agreement as follows.

          CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make any
          Advance to or for the account of Borrower under this Agreement is
          subject to the following conditions precedent, with all documents,
          instruments, opinions, reports, and other items required under this
          Agreement to be in form and substance satisfactory to Lender:

               (a)  Lender shall have received evidence that this agreement and
                    all Related Documents have been duly authorized, executed,
                    and delivered by Borrower to Lender.
               (b)  Lender shall have received such opinions of counsel,
                    supplemental opinions, and documents as Lender may request.
               (c)  The security interests in the Collateral shall have been
                    duly authorized, created, and perfected with first lien
                    priority and shall be in full force and effect.
               (d)  All guarantees required by Lender for the Line of Credit
                    shall have been executed by each Guarantor, delivered to
                    Lender, and be in full force and effect.
               (e)  Lender, at its option and for its sole benefit, shall have
                    conducted an audit of Borrower's Accounts, Inventory, books,
                    records, and operations, and Lender shall be satisfied as to
                    their condition.
               (f)  Borrower shall have paid to Lender all fees, costs, and
                    expenses specified in this Agreement and the related
                    documents as are then due and payable.
               (g)  There shall not exist at the time of any Advance a condition
                    which would constitute an Event of Default under this
                    Agreement,

<PAGE>

                    and Borrower shall have delivered to Lender the Compliance
                    certificate called for the paragraph below titled
                    "Compliance Certificate."

COLLATERAL. To secure payment of the Line of Credit and performance of all
other Loans, obligations and duties owed by Borrower to Lender, Borrower (and
others, if required) shall grant to Lender Security Interests in such
property and assets as Lender may require (the "Collateral"), including
without limitation Borrower's present and future Accounts, general
intangibles, and Inventory. Lender's Security Interests in the Collateral
shall be continuing liens and shall include the proceeds and products of the
Collateral, including without limitation the proceeds of any insurance. With
respect to the Collateral, Borrower agrees and represents and warrants to
Lender:

          PERFECTION OF SECURITY INTERESTS. Borrower agrees to execute such
          financing statements and to take whatever other actions are requested
          by Lender to perfect and continue Lender's Security Interests in the
          Collateral. Upon request of Lender, Borrower will deliver to Lender
          any and all of the documents evidencing or constituting the
          Collateral, and Borrower will note Lender's interest upon any and all
          chattel paper if not delivered to Lender for possession by Lender.
          Contemporaneous with the execution of this Agreement, Borrower will
          execute one or more UCC financing statements and any similar
          statements as may be required by applicable law, and will file such
          financing statements and all such similar statements in the
          appropriate location or locations. Borrower hereby appoints Lender as
          its irrevocable attorney-in-fact for the purpose of executing any
          documents necessary to perfect or continue any Security Interest.
          Lender may at any time, and without further authorization from
          Borrower, file a carbon, photograph, facsimile, or other reproduction
          of any financing statement for use as a financing statement. Borrower
          will reimburse Lender for all expenses for the perfection,
          termination, and the continuation of the perfection of Lender's
          Security Interest in the Collateral. Borrower promptly will notify
          Lender of any change in Borrower's name including any change to the
          assumed business names of Borrower. Borrower also promptly will notify
          Lender of any change in Borrower's Social Security Number or Employer
          Identification Number. Borrower further agrees to notify Lender in
          writing prior to any change in address or location of Borrower's
          principal governance office or should Borrower merge or consolidate
          with any other entity.

          COLLATERAL RECORDS. Borrower does now, and at all times hereafter
          shall, keep correct and accurate records of the Collateral, all of
          which records shall be available to Lender or Lender's representative
          upon demand for inspection and copying at any reasonable time. With
          respect to the Accounts, Borrower agrees to keep and maintain such
          records as Lender may require, including without limitation
          information concerning Eligible Accounts and Account balances and
          agings. With respect to the Inventory, Borrower agrees to keep and
          maintain such records as Lender may require, including without
          limitation information concerning Eligible Inventory and records
          itemizing and describing the kind, type, quality, and quantity of
          Inventory, Borrower's inventory costs and selling prices, and the
          daily withdrawals and additions to Inventory.

          COLLATERAL SCHEDULES. Concurrently with the execution and delivery of
          this Agreement, Borrower shall execute and deliver to Lender schedules
          of Accounts and Inventory and Eligible Accounts and Eligible
          Inventory, in form and substance satisfactory to Lender. Thereafter
          and at such

<PAGE>

          frequency as Lender shall require, Borrower shall execute and deliver
          to Lender such supplemental schedules of Eligible Accounts and
          Eligible Inventory and such other matters and information relating to
          the Accounts and Inventory that Lender may request.

          REPRESENTATIONS AND WARRANTIES CONCERNING ACCOUNTS. With respect to
          the Accounts, Borrower represents and warrants to Lender: (a) Each
          Account represented by Borrower to be an Eligible Account for purposes
          of this agreement conforms to the requirements of the definition of an
          Eligible Account; (b) All Account information listed on schedules
          delivered to Lender will be true and correct, subject to immaterial
          variance; and (c) Lender, its assigns, or agents shall have the right
          at any time and at the Borrower's expense to inspect, examine, and
          audit borrower's records and to confirm with Account Debtors the
          accuracy of such Accounts.

          REPRESENTATIONS AND WARRANTIES CONCERNING INVENTORY. With respect to
          the Inventory, Borrower represents and warrants to Lender: (a) All
          Inventory represented by Borrower to be Eligible Inventory for
          purposes of this agreement conforms to the requirements of the
          definition of Eligible Inventory; (b) All Inventory values listed on
          schedules delivered to Lender will be true and correct, subject to
          immaterial variance; (c) The value of the inventory will be determined
          on a consistent accounting basis; (d) Except as agreed to the contrary
          by Lender in writing, all Eligible Inventory is now and at all times
          hereafter will be in Borrower's physical possession and shall not be
          held by others on consignment, sale on approval, or sale or return;
          (e) Except as reflected in the Inventory schedules delivered to
          Lender, all Eligible Inventory is at all times hereafter will be of
          good and merchantable quality, free from defects; (f) Eligible
          Inventory is not now and will not at any time hereafter be stored with
          a bailee, warehouseman, or similar party without Lender's prior
          written consent, and, in such event, Borrower will concurrently at the
          time of bailment cause any such bailee, warehouseman, or similar party
          to issue or deliver to Lender, in form applicable to Lender, warehouse
          receipts in Lender's name evidencing the storage of Inventory; and (g)
          Lender, its assigns, or agents shall have the right at any time and at
          Borrower's expense to inspect or examine the Inventory and to check
          and test the same as to quality, quantity, value, and condition.

ADDITONAL CREDIT FACILITIES. In addition to the Line of Credit facility, the
following credit accommodations are either in place or will be made available to
Borrower:

          OTHER FACILITY. Subject to the terms and conditions of the Agreement,
          the following described credit facility is either in place or will be
          made available to Borrower: Letter of Credit.

REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender, as
of the date of this Agreement, as of the date of each disbursement of Loan
proceeds, as of the date of any renewal, extension or modification of any Loan,
and at all times any Indebtedness exists:

          ORGANIZATION. Borrower is a corporation which is duly organized,
          validly existing, and in good standing under the laws of the state of
          Borrower's incorporation and is validly existing and in good standing
          in all states in which Borrower is doing business. Borrower has the
          full power and authority to own its properties and to transact the
          businesses in which it is presently engaged or presently proposes to
          engage. Borrower also is

<PAGE>

          duly qualified as a foreign corporation and is in good standing in all
          states in which the failure to so qualify would have a material
          adverse effect on its businesses or financial condition.

          AUTHORIZATION. The execution, delivery, and performance of this
          Agreement and all Related Documents by Borrower, to the extent to be
          executed, delivered or performed by Borrower, have been duly
          authorized by all necessary action by Borrower, do not require the
          consent or approval of any other person, regulatory authority or
          governmental body; and do not conflict with, result in a violation of,
          or constitute a default under (a) any provision of its articles of
          incorporation or organization, or bylaws, or any agreement or other
          instrument binding upon Borrower or (b) any law, governmental
          regulation, court decree, or order applicable to Borrower.

          FINANCIAL INFORMATION. Each financial statement of Borrower supplied
          to Lender truly and completely disclosed Borrower's financial
          condition as of the date of the statement, and there has been no
          material adverse change in Borrower's financial condition subsequent
          to the date of the most recent financial statement supplied to Lender.
          Borrower has no material contingent obligations except as disclosed in
          such financial statements.

          LEGAL EFFECT. This Agreement constitutes, and any instrument or
          agreement required hereunder to be given by Borrower when delivered
          will constitute, legal, valid and binding obligations of Borrower
          enforceable against Borrower in accordance with their respective
          terms.

          PROPERTIES. Except for Permitted liens, Borrower owns and has good
          title to all of Borrowers properties free and clear of all Security
          Interests, and has not executed any security documents or financing
          statements relating to such properties. All of Borrower's properties
          are titled in Borrower's legal name, and Borrower has not used, or
          filed a financing statement under, any other name for at least the
          last five (5) years.

          HAZARDOUS SUBSTANCES. The terms "hazardous waste," "hazardous
          substance," "disposal," "release," and "threatened release," as used
          in this Agreement, shall have the same meanings as set forth in the
          "CERCLA," "SARA," the Hazardous Materials Transportation Act, 49
          U.S.C. Section 1801, et seq., the Resource Conservation and Recovery
          Act, 42 U.S.C. Section 6901, et seq., or other applicable state or
          Federal laws, rules, or regulations adopted pursuant to any of the
          foregoing. Except as disclosed to and acknowledged by Lender in
          writing, Borrower represents and warrants that: (a) During the period
          of Borrower's ownership of the properties, there has been no use,
          generation, manufacture, storage, treatment, disposal, release or
          threatened release of any hazardous waste or substance by any person
          on, under, about or from any of the properties; (b) Borrower has no
          knowledge of, or reason to believe that there has been (i) any use,
          generation, manufacture, storage, treatment, disposal, release, or
          threatened release of any hazardous waste or substance on, under,
          about or from the properties by any prior owners or occupants of any
          of the properties, or (ii) any actual or threatened litigation or
          claims of any kind by any person relating to such matters. (c) Neither
          Borrower nor any tenant, contractor, agent or other authorized user of
          any of the properties shall use, generate, manufacture, store, treat,
          dispose of, or release any hazardous waste or substance on, under,
          about or from any of the properties; and any such activity shall be
          conducted in compliance with all applicable federal, state, and local
          laws, regulations, and ordinances, including without limitation those
          laws,

<PAGE>

          regulations and ordinances described above. Borrower authorizes Lender
          and its agents to enter upon the properties to make such reasonable
          inspections and tests as Lender may deem appropriate to determine
          compliance of the properties with this section of the Agreement. Any
          inspections or tests made by Lender shall be at Borrower's expense and
          for Lender's purposes only and shall not be construed to create any
          responsibility or liability on the part of Lender to Borrower or to
          any other person. The representations and warranties contained herein
          are based on Borrower's due diligence in investigating the properties
          for hazardous waste and hazardous substances. Borrower hereby (a)
          releases and waives any future claims against Lender for indemnity or
          contribution in the event Borrower becomes liable for cleanup or other
          costs under any such laws, and (b) agrees to indemnify and hold
          harmless Lender against any and all claims, losses, liabilities,
          damages, penalties, and expenses which Lender may directly or
          indirectly sustain or suffer resulting from a breach of this section
          of the Agreement or as a consequence of any use, generation,
          manufacture, storage, disposal, release or threatened release
          occurring prior to Borrower's ownership or interest in the properties,
          whether or not the same was or should have been known to Borrower. The
          provisions of this section of the Agreement, including the obligation
          to indemnity, shall survive the payment of the Indebtedness and the
          termination or expiration of this Agreement and shall not be affected
          by Lender's acquisition of any interest in any of the properties,
          whether by foreclosure or otherwise.

          LITIGATION AND CLAIMS. No litigation, claim, investigation,
          administrative proceeding or similar action (including those for
          unpaid taxes) against Borrower is pending or threatened, and no other
          event has occurred which may materially adversely affect Borrower's
          financial condition or properties, other than litigation, claims, or
          other events, if any, that have been disclosed to and acknowledged by
          Lender in writing.

          TAXES. To the best of Borrower's knowledge, all tax returns and
          reports of Borrower that are or were required to be filed, have been
          filed, and all taxes, assessments and other governmental charges have
          been paid in full, except those presently being or to be contested by
          Borrower in good faith in the ordinary course of business and for
          which adequate reserves have been provided.

          LIEN PRIORITY. Unless otherwise previously disclosed to Lender in
          writing, Borrower has not entered into or granted any Security
          Agreements, or permitted the filing or attachment of any Security
          Interests on or affecting any of the Collateral directly or indirectly
          securing repayment of Borrower's Loan and Note, that would be prior or
          that may in any way be superior to Lender's Security Interests and
          rights in and to such Collateral.

          BINDING EFFECT. This Agreement, the Note, all Security Agreements
          directly or indirectly securing repayment of Borrower's Loan and Note
          and all of the Related Documents are binding upon Borrower as well as
          upon Borrower's successors, representatives and assigns, and are
          legally enforceable in accordance with their respective terms.

          COMMERCIAL PURPOSES. Borrower intends to use the Loan proceeds solely
          for business or commercial related purposes.

<PAGE>

          EMPLOYEE BENEFIT PLANS. Each employee benefit plan as to which
          Borrower may have any liability complies in all material respects with
          all applicable requirements of law and regulations, and (i) no
          Reportable Event nor Prohibited Transaction (as defined in ERISA) has
          occurred with respect to any such plan, (ii) Borrower has not
          withdrawn with any such plan or initiated steps to do so, (iii) not
          steps have been taken to terminate any such plan, and (iv) there are
          not unfunded liabilities other than those previously disclosed to
          Lender in writing.

          LOCATION OF BORROWER'S OFFICES AND RECORDS. Borrower's place of
          business, or Borrower's Chief executive office, if Borrower has more
          than one place of business, is located at 4800 NW 1st Street, Lincoln,
          NE 68521-9918. Unless Borrower has designated otherwise in writing
          this location is also the office or offices where Borrower keeps its
          records concerning the Collateral.

          INFORMATION. All information heretofore or contemporaneously herewith
          furnished by Borrower to Lender for the purposes of or in connection
          with this Agreement or any transaction contemplated hereby is, and all
          information hereafter furnished by or on behalf of Borrower to Lender
          will be, true and accurate in every material respect on the date as of
          which such information is dated or certified; and none of such
          information is or will be incomplete by omitting to state any material
          fact necessary to make such information not misleading.

          SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Borrower understands and
          agrees that Lender, without independent investigation, is relying on
          the above representations and warranties in extending Loan Advances to
          Borrower. Borrower further agrees that the foregoing representations
          and warranties shall be continuing in nature and shall remain in full
          force and effect until such time as Borrowers Indebtedness shall be
          paid in full, or until this Agreement shall be terminated in the
          manner provided above, whichever is the last to occur.

AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that, while
this Agreement is in effect, Borrower will:

          LITIGATION. Promptly inform Lender in writing of (a) all material
          adverse changes in Borrower's financial condition, and (b) all
          existing and all threatened litigation, claims, investigations,
          administrative proceedings or similar actions affecting Borrower or
          any Guarantor which could materially affect the financial condition of
          Borrower or the financial condition of any Guarantor.

          FINANCIAL RECORDS. Maintain its books and records in accordance with
          generally accepted accounting principles, applied on a consistent
          basis, and permit Lender to examine Borrower's books and records at
          all reasonable times.

          FINANCIAL STATEMENTS. Furnish Lender with, as soon as available, but
          in no event later than one hundred twenty (120) days after the end of
          each fiscal year, Borrower's balance sheet and income statement for
          the year ended, audited by a certified public accountant satisfactory
          to Lender, and, as soon as available, but in no event later than forty
          five (45) days after the end of each fiscal quarter, Borrower's
          balance sheet and profit and loss statement for the period ended
          without footnotes, prepared and certified as correct to the best
          knowledge and belief by Borrower's chief

<PAGE>

          financial officer or other officer or person acceptable to Lender. All
          financial reports required to be provided under this Agreement shall
          be prepared in accordance with generally accepted accounting
          principles, applied on a consistent basis subject to normal year-end
          adjustments, and certified by Borrower as being true and correct.

          ADDITIONAL INFORMATION. Furnish such additional information and
          statements, lists of assets and liabilities, agings of receivables and
          payables, inventory schedules, budgets, forecasts, tax returns, and
          other reports with respect to Borrower's financial condition and
          business operations as Lender may request from time to time.

          FINANCIAL COVENANTS AND RATIOS. Comply with the following covenants
          and ratios:

               TANGIBLE NET WORTH. Maintain a minimum Tangible Net Worth of not
               less than $32,000,000.00.

               CASH FLOW REQUIREMENTS. Maintain Cash Flow at not less than the
               following level: Minimum EBITDA of negative $3,000,000.00.

          The following provisions shall apply for purposes of determining
          compliance with the foregoing financial covenants and ratios:
          Covenants and ratios to be calculated on December 31, 2000. Except as
          provided above, all computations made to determine compliance with the
          requirements contained in this section shall be made in accordance
          with generally accepted accounting principles, applied on a consistent
          basis, and certified by Borrower as being true and correct.

          INSURANCE. Maintain fire and other risk insurance and public liability
          insurance, with respect to Borrower's properties and operations, in
          form, amounts, coverages and with insurance companies reasonably
          acceptable to Lender. Borrower, upon request of Lender, will deliver
          to Lender from time to time copies of policies or certificates of
          insurance, including stipulations that coverages will not be canceled
          or diminished without at least ten (10) days' prior written notice to
          Lender. Each insurance policy shall also include an endorsement
          providing that coverage in favor of Lender will not be impaired in any
          way by any act, omission or default of Borrower or any other person.
          In connection with all policies covering assets in which Lender holds
          or is offered a security interest for the Loans, Borrower will provide
          Lender with such loss payable or other endorsements as Lender may
          reasonably require.

          INSURANCE REPORTS. Furnish to Lender, upon request of Lender, reports
          on each existing insurance policy showing such information as Lender
          may reasonably request, including without limitation the following:
          (a) the name of the insurer; (b) the risks insured; (c) the amount of
          the policy; (d) the properties insured; (e) the then current property
          values on the basis of which insurance has been obtained, and the
          manner of determining those values; and (f) the expiration of the
          policy. In addition, upon request of Lender (however not more often
          than annually)Borrower will have an independent appraiser satisfactory
          to Lender determine, as applicable, the actual cash value or
          replacement cost of any Collateral. The cost of such appraisal shall
          be paid by Borrower.

          GUARANTIES. Prior to disbursement of any Loan proceeds, furnish
          executed guaranties of the Loans in favor of Lender, executed by the
          guarantor

<PAGE>

          named below, on Lender's forms, and in the amount and under the
          conditions spelled out in those guaranties.

             Guarantor                      Amount

          E.F. Johnson Company            Unlimited

          OTHER AGREEMENTS. Comply with all terms and conditions of all other
          agreements, whether now or hereafter existing, between Borrower and
          any other party and notify Lender immediately in writing of any
          default in connection with any other such agreements.

          LOAN PROCEEDS. Use all Loan proceeds solely for Borrower's business
          operations, unless specifically consented to the contrary by Lender in
          writing.

          TAXES, CHARGES AND LIENS. Pay and discharge when due all of its
          indebtedness and obligations, including without limitation all
          assessments, taxes, governmental charges, levies and liens, of every
          kind and nature imposed upon Borrower or its properties, income, or
          profits, prior to the date on which penalties would attach in and all
          lawful claims that, if unpaid, might become a lien or charge upon any
          of Borrower's properties, income or profits. Provided however,
          Borrower will not be required to pay and discharge any such
          assessment, tax, charge, levy, lien or claim so long as (a) the
          legality of the same shall be contested in good faith by appropriate
          proceedings, and (b) Borrower shall have established on its books
          adequate reserves with respect to such contested assessment, tax,
          charge, levy, lien, or claim in accordance with generally accepted
          accounting practices. Borrower, upon demand of Lender, will furnish to
          Lender evidence of payment of the assessments, taxes, charges, levies,
          liens and claims and will authorize the appropriate governmental
          official to deliver to Lender at any time a written statement of any
          assessments, taxes, charges, levies, liens and claims against
          Borrower's properties, income, or profits.

          PERFORMANCE. Perform and comply with all terms, conditions, and
          provisions set forth in this Agreement and in the Related Documents in
          a timely manner, and promptly notify Lender if Borrower learns of the
          occurrence of any event which constitutes an Event of Default under
          this Agreement or under any of the Related Documents.

          OPERATIONS. Maintain executive and management personnel with
          substantially the same qualifications and experience as the present
          executive and management personnel; provide written notice to Lender
          of any change in executive and management personnel; conduct its
          business affairs in a reasonable and prudent business manner and in
          compliance with all federal, state, and municipal laws, ordinances,
          rules, and regulations respecting its properties, charters, businesses
          and operations, including without limitation, compliance with the
          Americans with Disabilities Act and with all minimum funding standards
          and other requirements of ERISA and other laws applicable to
          Borrower's employee benefit plans.

          INSPECTION. Permit employees or agents of Lender at any reasonable
          time to inspect any and all Collateral for the Loan or Loans and
          Borrower's other properties and to examine or audit borrower's books,
          accounts, and records and make copies and memoranda of Borrower's
          books, accounts, and records. If Borrower now or at any time hereafter
          maintains any records (including without limitation computer generated
          records and computer software

<PAGE>

          programs for the generation of such records) in the possession of a
          third party, Borrower, upon request of Lender, shall notify such party
          to permit Lender free access to such records at all reasonable times
          and to provide Lender with copies of any records it may request, at
          Borrower's expense.

          COMPLIANCE CERTIFICATE. Unless waived in writing by Lender, provide
          Lender at least annually and at the time of each disbursement of Loan
          proceeds with a certificate executed by Borrower's chief financial
          officer, or other officer or person acceptable to Lender, certifying
          that the representations and warranties set forth in this Agreement
          are true and correct as of the date of the certificate and further
          certifying that, as of the date of the certificate, no Event of
          Default exists under this Agreement.

          ENVIRONMENTAL COMPLIANCE AND REPORTS. Borrower shall comply in all
          respects with all environmental protection federal, state and local
          laws, statutes, regulations, and ordinances; not cause or permit to
          exist, as a result of an intentional or unintentional action or
          omission on its part or on the part of any third party on property
          owned and/or occupied by Borrower, any environmental activity where
          damage may result to the environment, unless such environmental
          activity is pursuant to and in compliance with the conditions of a
          permit issued by the appropriate federal, state or local governmental
          authorities; shall furnish to Lender promptly and in any event within
          thirty (30) days after receipt thereof a copy of any notice, summons,
          lien, citation, directive, letter or other communication from any
          governmental agency or instrumentality concerning any intentional or
          unintentional action or omission on Borrower's part in connection with
          any environmental activity whether or not there is damage to the
          environment and/or other natural resources.

          ADDITIONAL ASSURANCES. Make, execute and deliver to Lender such
          promissory notes, mortgages, deeds of trust, security agreements,
          financing statements, instruments, documents and other agreements as
          Lender or its attorneys may reasonably request to evidence and secure
          the Loans and to perfect all Security Interests.

NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while this
Agreement is in effect, Borrower shall not, without the prior written consent of
Lender:

          CAPITAL EXPENDITURES. Make or contract to make capital expenditures,
          including leasehold improvements, in any fiscal year in excess of
          $3,500,000 or incur liability for rentals of property (including both
          real and personal property) in an amount which, together with capital
          expenditures, shall in any fiscal year exceed such sum.

          INDEBTEDNESS AND LIENS. (a) Except for trade debt incurred in the
          normal course of business and indebtedness to Lender contemplated by
          this Agreement, create, incur or assume indebtedness for borrowed
          money, including capital leases, (b) except as allowed as a Permitted
          Lien, sell, transfer, mortgage, assign, pledge, lease, grant a
          security interest in, or encumber any of Borrower's assets, or (c)
          sell with recourse any of Borrower's accounts, except to Lender.

          CONTINUITY OF OPERATIONS. (a) Engage in any business activities
          substantially different than those in which Borrower is presently
          engaged, (b) cease operations, liquidate, merge, transfer, acquire or
          consolidate

<PAGE>

          with any other entity, change ownership, change its name, dissolve or
          transfer or sell collateral out of the ordinary course of business, or
          (c) sell with recourse any of the Borrower's accounts, except to
          Lender.

          LOANS, ACQUISITIONS AND GUARANTIES. (a) Loan, invest in or advance
          money or assets, (b) purchase, create or acquire any interest in any
          other enterprise or entity, or (c) incur any obligation as surety or
          guarantor other than in the ordinary course of business.

CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to
Borrower, whether under this Agreement or under any other agreement, Lender
shall have no obligation to make Loan Advances or to disburse Loan proceeds if:
(a) Borrower or any Guarantor is in default under the terms of this Agreement or
any of the related Documents or nay other agreement that Borrower or any
Guarantor has with Lender; (b) Borrower or any Guarantor becomes insolvent,
files a petition in bankruptcy or similar proceedings, or is adjudged a
bankrupt; (c) there occurs a material adverse change in Borrowers financial
condition, in the condition of any Guarantor, or in the value of any Collateral
securing any Loan; (d) any Guarantor seeks, claims or otherwise attempts to
limit, modify or revoke such Guarantor's guaranty of the Loan or any other Loan
with Lender; or (e) Lender in good faith deems itself insecure, even though no
event of default has occurred.

RIGHT OF SETOFF. Borrower grants to Lender a contractual security interest in,
and hereby assigns, conveys, delivers, pledges, and transfers to Lender all
Borrower's right, title and interest in and to, Borrower's accounts with Lender
(whether checking, savings or some other account), including without limitation
all accounts held jointly with someone else and all accounts Borrower may open
in the future, excluding however all IRA and Keogh accounts, and all trust
accounts for which the grant of a security interest would be prohibited by law.
Borrower authorizes Lender, to the extent permitted by applicable law, to charge
or setoff all sums owing on the indebtedness against any and all such accounts.

EVENTS OF DEFAULT. Each of the following shall constitute an Event of Default
under this Agreement:

          DEFAULT ON INDEBTEDNESS. Failure of Borrower to make any payment when
          due on the Loans.

          OTHER DEFAULTS. Failure of Borrower or any Grantor to comply with or
          to perform when due any other term, obligation, covenant or condition
          contained in this Agreement or in any of the Related Documents, or
          failure of Borrower to comply with or to perform any other term,
          obligation, covenant or condition contained in any other agreement
          between Lender and Borrower.

          DEFAULT IN FAVOR OF THIRD PARTIES. Should Borrower or any Grantor
          default under any loan, extension of credit, security agreement,
          purchase or sales agreement, or any other agreement, in favor of any
          other creditor or person that may materially affect any of Borrower's
          property or Borrower's or Grantor's ability to repay the Loans or
          perform their respective obligations under this Agreement or any of
          the Related Documents.

          FALSE STATEMENTS. Any warranty, representation or statement made or
          furnished to Lender by or on behalf of Borrower or any Grantor under
          this Agreement or the Related Documents is false or misleading in any
          material

<PAGE>

          respect at the time made or furnished, or becomes false or misleading
          at any time thereafter.

          DEFECTIVE COLLATERALIZATION. This Agreement or any of the Related
          Documents ceases to be in full force and effect (including failure of
          any Security Agreement to create a valid and perfected Security
          Interest) at any time and for any reason.

          INSOLVENCY. The dissolution or termination of Borrower's existence as
          a going business, the insolvency of Borrower, the appointment of a
          receiver for any part of Borrower's property, any assignment for the
          benefit of creditors, any type of creditor workout, or the
          commencement of any proceeding under any bankruptcy or insolvency laws
          by or against Borrower.

          CREDITOR OR FORFEITURE PROCEEDINGS. Commencement of foreclosure or
          forfeiture proceedings, whether by judicial proceeding, self-help,
          repossession or any other method, by any creditor of Borrower, any
          creditor of any Grantor against any collateral securing the
          Indebtedness, or by any governmental agency. This includes a
          garnishment, attachment, or levy on or of any of Borrower's deposit
          accounts with Lender. However, this Event of Default shall not apply
          if there is a good faith dispute by Borrower or Grantor, as the case
          may be, as to the validity or reasonableness of the claim which is the
          basis of the creditor or forfeiture proceeding, and if Borrower or
          Grantor gives Lender written notice of the creditor or forfeiture
          proceeding and furnishes reserves or a surety bond for the creditor or
          forfeiture proceeding satisfactory to Lender.

          EVENTS AFFECTING GUARANTOR. Any of the preceding events occurs with
          respect to any Guarantor of any of the indebtedness or any Guarantor
          dies or becomes incompetent, or revokes or disputes the validity of,
          or liability under, any Guaranty of the Indebtedness. Lender, at its
          option, may, but will not be required to, permit the Guarantor's
          estate to assume unconditionally the obligations arising under the
          guaranty in a manner satisfactory to Lender, and, in doing so, cure
          the Event of Default.

          CHANGE IN OWNERSHIP. Any change in ownership of twenty-five percent
          (25%) or more of the common stock of Borrower.

          ADVERSE CHANGE. A material adverse change occurs in Borrower's
          financial condition or Lender believes the prospect of payment or
          performance of the Indebtedness is impaired.

          INSECURITY. Lender, in good faith, deems itself insecure.

          RIGHT TO CURE. If any default, other than a Default on Indebtedness,
          is curable and if Borrower or Grantor, as the case may be, has not
          been given a notice of a similar default within the preceding twelve
          (12) months, it may be cured (and no Event of Default will have
          occurred) if Borrower or Grantor, as the case may be, after receiving
          written notice from Lender demanding cure of such default: (a) cures
          the default within fifteen (15) days; or (b) if the cure requires more
          than fifteen (15) days, immediately initiates steps which Lender deems
          in Lender's sole discretion to be sufficient to cure the default and
          thereafter continues and completes all reasonable and necessary steps
          sufficient to produce compliance as soon as reasonably practical.

<PAGE>

EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except where
otherwise provided in this Agreement or the Related Documents, all commitments
and obligations of Lender under this Agreement or the Related Documents or any
other agreement immediately will terminate (including any obligation to make
Loan Advances or disbursements), and, at Lender's option, all Indebtedness
immediately will become due and payable, all without notice of any kind to
Borrower, except that in the case of an Event of Default of the type described
in the "Insolvency" subsection above, such acceleration shall be automatic and
not optional. In addition, Lender shall have all the rights and remedies
provided in the Related Documents or available at law, in equity, or otherwise.
Except as may be prohibited by applicable law, all of Lender's rights and
remedies shall be cumulative and may be exercised singularly or concurrently.
Election by Lender to pursue any remedy shall not exclude pursuit of any other
remedy, and an election to make expenditures or to take action to perform an
obligation of Borrower or of any Grantor shall not affect Lender's right to
declare a default and to exercise its rights and remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement:

          AMENDMENTS. This Agreement, together with any Related Documents,
          constitutes the entire understanding and agreement of the parties as
          to the matters set forth in this Agreement. No alteration of or
          amendment to this Agreement shall be effective unless given in writing
          and signed by the party or parties sought to be charged or bound by
          the alteration or amendment.

          APPLICABLE LAW. This agreement has been delivered to lender and
          accepted by lender in the state of Nebraska. If there is a lawsuit,
          borrower agrees upon lender's request to submit to the jurisdiction of
          the courts of Lancaster County, the state of Nebraska. This agreement
          shall be governed by and construed in accordance with the laws of the
          state of Nebraska.

          CAPTION HEADINGS. Caption headings in this Agreement are for
          convenience purposes only and are not to be used to interpret or
          define the provisions of this Agreement.

          MULTIPLE PARTIES; CORPORATE AUTHORITY. All obligations of Borrower
          under this Agreement shall be joint and several, and all references to
          Borrower shall mean each and every Borrower. This means that each of
          the persons signing below is responsible for all obligations in this
          Agreement.

          CONSENT TO LOAN PARTICIPATION. Borrower agrees and consents to
          Lender's sale or transfer, whether now or later, of one or more
          participation interests in the Loans to one or more purchasers,
          whether related or unrelated to Lender. Lender may provide, without
          any limitation whatsoever, to any one or more purchasers, or potential
          purchasers, any information or knowledge Lender may have about
          Borrower or about any other matter relating to the Loan, and Borrower
          hereby waives any rights to privacy it may have with respect to such
          matters. Borrower additionally waives any and all notices of sale of
          participation interests, as well as all notices of any repurchase of
          such participation interests. Borrower also agrees that the purchasers
          of any such participation interests will be considered as the absolute
          owners of such interests in the Loans and will have all the rights
          granted under the participation agreement or agreements governing the
          sale of such participation interests. Borrower

<PAGE>

          further waives all rights of offset or counterclaim that it may have
          now or later against Lender or against any purchaser of such a
          participation interest and unconditionally agrees that either Lender
          or such purchaser may enforce Borrower's obligation under the Loans
          irrespective of the failure or insolvency of any holder of any
          interest in the Loans. Borrower further agrees that the purchaser of
          any such participation interests may enforce its interests
          irrespective of any personal claims or defenses that Borrower may have
          against Lender.

          COSTS AND EXPENSES. Borrower agrees to pay upon demand all of Lender's
          expenses, including without limitation attorneys' fees, incurred in
          connection with the preparation, execution, enforcement, modification
          and collection of this Agreement or in connection with the Loans made
          pursuant to this Agreement. Lender may pay someone else to help
          collect the Loans and to enforce this Agreement, and Borrower will pay
          that amount. This includes, subject to any limits under applicable
          law, Lender's attorneys' fees and Lender's legal expenses, whether or
          not there is a lawsuit, including attorneys' fees for bankruptcy
          proceedings (including efforts to modify or vacate any automatic stay
          or injunction), appeals, and any anticipated post-judgment collection
          services. Borrower also will pay any court costs, in addition to all
          other sums provided by law.

          NOTICES. All notices required to be given under this Agreement shall
          be given in writing, may be sent by telefacsimile (unless otherwise
          required by law), and shall be effective when actually delivered or
          when deposited with a nationally recognized overnight courier or
          deposited in the United States mail, first class, postage prepaid,
          addressed to the party to whom the notice is to be given at the
          address shown above. Any party may change its address for notices
          under this Agreement by giving formal written notice to the other
          parties, specifying that the purpose of the notice is to change the
          party's address. To the extent permitted by applicable law, if there
          is more than one Borrower, notice to any Borrower will constitute
          notice to all Borrowers. For notice purposes, Borrower will keep
          Lender informed at all times of Borrower's current address(es).

          SEVERABILITY. If a court of competent jurisdiction finds any provision
          of this Agreement to be invalid or unenforceable as to any person or
          circumstance, such finding shall not render that provision invalid or
          unenforceable as to any other persons or circumstances. If feasible,
          any such offending provision shall be deemed to be modified to be
          within the limits of enforceability or validity; however, if the
          offending provision cannot be so modified, it shall be stricken and
          all other provisions of this Agreement in all other respects shall
          remain valid and enforceable.

          SUBSIDIARIES AND AFFILIATES OF BORROWER. To the extent the context of
          any provisions of this Agreement makes it appropriate, including
          without limitation any representation, warranty or covenant, the word
          "Borrower" as used herein shall include all subsidiaries and
          affiliates of Borrower. Notwithstanding the foregoing however, under
          no circumstances shall this agreement be construed to require the
          Lender to make any Loan or other financial accommodation to any
          subsidiary or affiliate of Borrower.

          SUCCESSORS AND ASSIGNS. All covenants and agreements contained by or
          on behalf of Borrower shall bind its successors and assigns and shall
          inure to the benefit of Lender, its successors and assigns. Borrower
          shall not, however, have the right to assign its rights under this
          Agreement or any interest therein, without the prior written consent
          of Lender.

<PAGE>

          SURVIVAL. All warranties, representations, and covenants made by
          Borrower in this Agreement or in any certificate or other instrument
          delivered by Borrower to Lender under this Agreement shall be
          considered to have been relied upon by Lender and will survive the
          making of the Loan and delivery to Lender of the Related Documents,
          regardless of any investigation made by Lender or on Lender's behalf.

          TIME IS OF THE ESSENCE. Time is of the essence in the performance of
          this Agreement.

          WAIVER. Lender shall not be deemed to have waived any rights under
          this Agreement unless such waiver is given in writing and signed by
          Lender. No delay or omission on the part of Lender in exercising any
          right shall operate as a waiver of such right or any other right. A
          waiver by Lender of a provision of this Agreement shall not prejudice
          or constitute a waiver of Lender's right otherwise to demand strict
          compliance with that provision or any other provision of this
          Agreement. No prior waiver by Lender, nor any course of dealing
          between Lender and Borrower, or between Lender and any Grantor, shall
          constitute a waiver of any of Lenders rights or of any obligations of
          Borrower or of any Grantor as to any future transactions. Whenever the
          consent of Lender is required under this Agreement, the granting of
          such consent by Lender in any instance shall not constitute continuing
          consent in subsequent instances where such consent is required, and in
          all cases such consent may be granted or withheld in the sole
          discretion of Lender.

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN
AGREEMENT, AND BORROWER AGREES TO ITS TERMS. THIS AGREEMENT IS DATED AS OF
SEPTEMBER 30, 2000.

BORROWER:
TRANSCRYPT INTERNATIONAL, INC.

BY:   /S/  SCOTT W. AVERY
      -------------------------
      SCOTT W. AVERY, TREASURER

LENDER:
U.S. BANK NATIONAL ASSOCIATION

BY:   /S/  BETH MORGAN
      -------------------------
      AUTHORIZED OFFICER

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