Document:

EXHIBIT 10.10

                           REVOLVING CREDIT AGREEMENT

THIS  REVOLVING  CREDIT AGREEMENT (this "Agreement") is made as of September 26,
                                         ---------
2007,  by and between SENTRY TECHNOLOGY CORPORATION, a Delaware corporation (the
"Borrower"),  and  TRADITION CAPITAL BANK, a Minnesota state banking corporation
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(the  "Lender").
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                                  WITNESSETH:

     WHEREAS, the Borrower has requested that the Lender issue to the Borrower a
line  of  credit  in the amount of One Million Fifty Thousand and 00/100 Dollars
($1,050,000.00)  to  provide  working  capital  liquidity  for  operations;  and

     WHEREAS, the Lender is willing and prepared to provide such a line of
credit to the Borrower upon the terms and subject to the conditions hereinafter
set forth.

     WHEREAS,  the  Guarantors understand that this loan is granted due to their
personal  secured guaranties. If there are any repayment problems, the Bank will
go  first  to  the  guarantors  for repayment.   The guaranties will survive any
bankruptcy  filing  by  the  Borrower.

     NOW,  THEREFORE,  in consideration of the foregoing promises and the mutual
covenants  herein  contained, and for other good and valuable consideration, the
receipt  and  sufficiency of which are hereby acknowledged, the Borrower and the
Lender  hereby  agree  as  follows:

                                    ARTICLE I
                                      TERMS

SECTION  1.1.  DEFINITIONS.  As  used herein, the following terms shall have the
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following  meanings  for the purpose of this Agreement and the documents related
hereto unless the context in which such term is used clearly requires otherwise:

(A)     Advance:   A disbursement by the Lender pursuant to Section 1.2 hereof.
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(B)     Event of Default: As such term is defined in Section 5.1 hereof.
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(C)     Guaranties: Collectively, the Personal Guaranty of even date herewith
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executed Robert D. Furst, Jr. and the Personal Guaranty of even date herewith
executed by Peter L. Murdoch, each in favor of the Lender, pursuant to which
each of the Guarantors has, jointly and severally, absolutely and conditionally
guarantied, among other things, payment of the Note up to an amount not to
exceed Five Hundred Twenty-five Thousand and 00/100 Dollars ($525,000.00) by
each Guarantor and together totaling the outstanding principal balance due under
the Note and other Loan Documents.

(D)     Guarantors: Collectively, Robert D. Furst, Jr. and Peter L. Murdoch,
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jointly and severally.

(E)     Loan Documents: As such term is defined in Section 2.2 hereof.
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(F)     Note: the Revolving Credit Promissory Note of even date herewith
        ----
executed by the Borrower in the original principal amount of One Million Fifty
Thousand and 00/100 Dollars ($1,050,000.00) and payable to the order of the
Lender.

(G)     Organizational Documents: collectively, the following documents, each of
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which shall be in form and substance acceptable to the Lender:

(1)     A copy of the Articles of Incorporation for the Borrower, duly certified
        by the Secretary of State of the State of Delaware;

(2)     A copy of the Bylaws for the Borrower, duly certified by an officer of
        the Borrower;

(3)     A current Certificate of Good Standing for the Borrower, duly issued by
        the Secretary of State of the State of Delaware;

(4)     A copy of the resolutions of the Borrower authorizing the execution,
        delivery and performance of the Loan Documents.

(H) Revolving Credit Expiration Date: the earlier of (i) April 30, 2008, or (ii)
    --------------------------------
the  date  on  which an Event of Default occurs hereunder, or (iii) the date the
Lender  demands  payment  of  amounts  outstanding  under  the  Note.

(I) Revolving Line: the revolving line of credit established pursuant to Section
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2  hereof.

(J)  Revolving  Loan  Amount:  One  Million  Fifty  Thousand  and 00/100 Dollars
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($1,050,000.00).

(K)  Prime  Rate:  The  term  "Prime  Rate"  shall  mean at any time the rate of
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interest  most  recently  announced by the Lender at its principal office as its
Prime Rate as evidenced by the recording thereof in such internal publication or
publications  as  the  Lender may designate. Each change in the rate of interest
shall  become  effective  on the date each Prime Rate change is announced by the
Lender.

SECTION 1.2. THE LINE OF CREDIT.
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(A)     Line of Credit. Upon the terms and subject to the conditions hereinafter
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set forth, the Lender may in its discretion make Advances to the Borrower
pursuant to this Section 1.2 from time to time until and including the Revolving
Credit Expiration Date, or until the Revolving Line is terminated pursuant to
Section 5.2, whichever first occurs, at such time and in such amount as to each
loan as the Borrower shall request; provided, however, that (a) the aggregate
outstanding principal amount of all Advances under the Note (the "Aggregate
                                                                  ---------
Borrowings") may not exceed the Revolving Loan Amount at any time.   If at any
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time the Aggregate Borrowings exceed the Revolving Loan Amount, the Borrower
agrees to make, on demand, payment hereunder in an amount at least equal to such
excess, together with accrued interest on the amount prepaid to the date of such
prepayment. Subject to and upon the terms and conditions hereinafter set forth,
the Borrower may borrow, repay and reborrow under this Section 1.2 from the date
hereof to and including the Revolving Credit Expiration Date, or until the
Revolving Line is terminated pursuant to Section 5.2, whichever occurs first.

(B)     Note. The obligation of the Borrower to repay any and all Advances made
        ----
pursuant to Section 1.2 hereof shall be evidenced by the Note.   Notwithstanding
any provisions of the Note, however, interest shall be payable at the rates
provided for therein only on such portion of the loan proceeds as actually have
been disbursed hereunder and remain unpaid. The Lender's records shall be
conclusive evidence as to whether the Borrower has authorized any Advance
hereunder and as to the aggregate amount of Advances which have been made
hereunder and remain unpaid.

(C)     Manner of Borrowing. Each time the Borrower desires to obtain an Advance
        -------------------
pursuant to Section 1.2 hereof, the Borrower shall request such advance either
orally or in writing. Each such oral or written request must specify the date of
the requested Advance and the amount thereof. At the request of the Lender, an
oral request must be confirmed in writing by the Borrower within three (3)
business days of such request.    The Borrower shall be obligated to repay all
Advances received by Borrower notwithstanding the fact that the person
requesting the same was not in fact authorized to do so.   If a request for an
Advance is made by 11:00 o'clock a.m., and subject to the remaining terms and
conditions of this Agreement, such Advance shall be made on the same business
day. If a request for an Advance is made after 11:00 o'clock a.m., and subject
to the remaining terms and conditions of this Agreement, such Advance shall be
made on the next business day.

(D)     Payments. The Lender will have the right to pay accrued interest or
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principal on the Note and any and all other amounts due and payable under the
Loan Documents by making an advance against the Revolving Line, without further
authorization of the Borrower.

(E)  Security.  The  Lender recognizes that the Borrower is a going concern. The
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repayment  of  the  Note and the performance of Borrower's obligations under the
Loan  Documents is secured in part by the Commercial Security Agreement dated as
of  the  date  hereof  executed  by  Borrower  in  favor of Lender. In addition,
repayment  of  the  Note and the performance of Borrower's obligations under the
Loan  Documents is secured by the Guaranties, Assignment of Deposit Account, and
Commercial  Security  and  Pledge  Agreement. It is a condition precedent to the
making  of  any  Advances  that  Borrower  has  delivered to Lender the executed
Guaranties  and  other  documents  securing  Guarantors'  obligations  under the
Guaranties  as  the  Lender is relying primarily upon the Guaranties as security
for  the  repayment  of the Note and performance of Borrower's obligations under
the  Loan  Documents.

SECTION 1.3. INTEREST/FEES.
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(A)     Interest.   The outstanding principal balance of the Revolving Line
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shall bear interest at a rate per annum equal to the Prime Rate, in effect from
time to time, plus one percent (1%).

(B)     Computation and Repayment.  Interest shall be computed on the basis of a
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360- day year, actual days elapsed. Interest shall be payable at the times and
place set forth in the Note, The Lender will schedule the mailing of monthly
statements to the Borrower ten (10) days in advance of each payment due date.

                                 ARTICLE II
                      REPRESENTATIONS AND WARRANTIES

The  Borrower  makes the following representations and warranties to the Lender,
which  representations  and  warranties  shall  survive  the  execution  of this
Agreement  and  shall continue in full force and effect until the full and final
payment,  and  satisfaction and discharge, of all obligations of the Borrower to
the  Lender  subject  to  this  Agreement:

(A)     CORPORATE EXISTENCE AND POWER. The Borrower is a corporation duly
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organized, validly existing and in good standing under the laws of the State of
Delaware, and is in good standing in every other jurisdiction wherein the nature
of its business or the character of its properties makes such qualification
necessary and where failure to be so qualified and in good standing would, in
the aggregate, have a material adverse effect on the business, properties,
operations, assets, liabilities or condition (financial or otherwise) of the
Borrower, and has all requisite power and authority to carry on its business as
now conducted and as presently proposed to be conducted.

(B)     AUTHORIZATION AND VALIDITY.    The Borrower has full power and authority
        --------------------------
to execute and deliver this Agreement and the Note and all other contracts,
instruments and other documents required hereby or at any time hereafter
delivered to the Lender in connection herewith (collectively, the
"LoanDocuments"') and to incur and perform its obligations hereunder and
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thereunder; the execution, delivery and performance by the Borrower of the Loan
Documents and any and all other documents and transactions contemplated hereby
or thereby, have been duly authorized by all necessary corporate action, will
not violate any provision of law or the Articles of Incorporation or Bylaws of
the Borrower or result in the breach of, constitute a default under, or create
or give rise to any lien under, any indenture or other agreement or instrument
to which the Borrower is a party or by which the Borrower or its property may be
bound or affected; have been executed and delivered to the Lender by the
corporate officers of the Borrower who have been authorized by the Borrower's
Board of Directors, and who are authorized by and specified in the Borrower's
Articles of Incorporation and Bylaws, to execute and so deliver such agreements,
and upon their execution and delivery in accordance with the provisions hereof,
will constitute legal, valid and binding agreements and obligations of the
Borrower or the party which executes the same, enforceable in accordance with
their respective terms, subject to bankruptcy, insolvency, reorganization, or
other legal principals and laws relating to or affecting creditors' rights
generally.

(C)     LICENSES.    The Borrower possesses adequate licenses, permits,
franchises, patents, copyrights, trademarks and trade names, or rights thereto,
to conduct its business  substantially as now conducted and as presently
proposed to  be conducted.

(D)     NO VIOLATION.  The execution, delivery and performance by the Borrower
        ------------
of each of the Loan Documents does not violate any provision of any law or
regulation or result in any breach of or default under any contract, obligation,
indenture or other instrument to which the Borrower is a party or by which the
Borrower may be bound.

(E)     ENFORCEABILITY.  The Loan Documents and the Guaranties each constitute
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the legal, valid and binding obligations of the Borrower and each of the
Guarantors enforceable in accordance with the respective terms (subject, as to
enforceability, to limitations resulting from bankruptcy, insolvency and other
similar laws affecting creditors rights generally and principles of equity).

(F)     FINANCIAL CONDITION.  The financial statements of the Borrower and each
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of the Guarantors heretofore furnished to the Lender are complete and correct in
all respects and fairly present the financial condition of the Borrower and each
of the Guarantors at and as of the date of such statements and the results of
the Borrower's and the Company Guarantors' operations for the period ended on
said date. Since the most recent set of financial statements delivered by the
Borrower to the Lender, there has been no material adverse changes in the
financial condition of the Borrower or either of the Guarantors.

(G)     LITIGATION. There are no pending, or to the best of the Borrower's
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knowledge threatened, actions, claims, investigations, suits or proceedings by
or before any governmental authority, arbitrator, court or administrative agency
which could have a material adverse effect on the financial condition or
operation of the Borrower or the Guarantors other than those disclosed by the
Borrower to the Lender in writing prior to the date hereof.

(H) CORRECTNESS OF FINANCIAL STATEMENTS. The Borrower represents and warrants
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that its financial statement dated June 30, 2007, a true copy of which has been
delivered to the Lender prior to the date hereof, (1) is complete and correct
and presents fairly its financial condition (2) discloses all of its liabilities
that are required to be reflected or reserved against under industry standard
accounting principles, whether liquidated or unliquidated, fixed or contingent,
and (3) has been professionally prepared in accordance with industry standards.
Since the date of such financial statement there has been no material adverse
change in the financial condition of the Borrower.

(I)  INCOME  TAX  RETURNS. The Borrower has filed all tax returns required to be
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filed,  if  any,  and  either  paid all taxes shown thereon to be due, including
interest  and  penalties,  which  are  not  being contested in good faith and by
appropriate  proceedings, or provided adequate reserves for payment thereof, and
the  Borrower has no information or knowledge of any objections to or claims for
additional  taxes  in  respect  of federal or other income or excess profits tax
returns  for  prior  years.  The Borrower represents and warrants that it has no
knowledge of any pending assessment or adjustment of its income tax payable with
respect  to  any  year.

(J)  CONSENTS. No consent, approval, order or authorization of, or registration,
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declaration  or  filing  with,  or  notice to, any governmental authority or any
third  party  is  required in connection with the execution and delivery of this
Agreement,  or  any of the agreements or instruments herein mentioned or related
hereto  to  which  the Borrower is a party or the carrying out or performance of
any  of  the  transactions  required  or  contemplated  hereby or thereby or, if
required,  such  consent,  approval, order or authorization has been obtained or
such  registration,  declaration  or filing has been accomplished or such notice
has  been  given  prior  to  the  date  hereof.

(K)  NO  SUBORDINATION.  The  Borrower  represents and warrants that there is no
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agreement,  indenture, contract or instrument to which it is a party or by which
it  may  be  bound  that  requires  the subordination in right of payment of its
obligations  subject  to  this  Agreement  to  any  other  of  its  obligations.

(L)  OTHER  OBLIGATIONS.  The Borrower represents and warrants that it is not in
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default  on any obligation for borrowed money, any purchase money obligations or
any  other  material  lease,  commitment,  contract  instrument  or  obligation.

                                 ARTICLE III
                            AFFIRMATIVE COVENANTS

On  and  after the date hereof and until the payment in full of the Note and all
other  obligations  and  indebtedness  under  this  Agreement  and  all  related
documents  all  of  (the  "Obligations"),  and  the  performance  of  all other
                           -----------
obligations  of the Borrower hereunder, and so long as this Agreement remains in
full  force  and  effect,  the  Borrower  agrees  that,  unless the Lender shall
otherwise  consent  or  agree  in  writing:

(A)     PUNCTUAL PAYMENTS.    The Borrower shall punctually pay all principal,
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interest, fees or other liabilities due under any of the Loan Documents at the
times and place and in the manner specified therein.

(B)     FINANCIAL STATEMENTS.   As requested by Lender from time to time, the
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Borrower shall deliver, or cause to be delivered such information in such form
and detail satisfactory to the Lender regarding the business, operations,
affairs, financial and other condition of the Borrower, the Guarantors and/or
any of its or their properties.

(C)     TAXES AND OTHER LIABILITIES. The Borrower shall pay and discharge all
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indebtedness, obligations, assessments and taxes, both real or personal,
including without limitation federal and state income taxes and state and local
property taxes and assessments as and when the same are due and payable, except
such (a) as the Borrower may in good faith contest or as to which a bona fide
dispute may arise, and (b) for which the Borrower has made provision, to the
Lender's satisfaction, for eventual payment thereof in the event Borrower is
obligated to make such payment.

(D)     MAINTENANCE OF EXISTENCE: CONDUCT OF BUSINESS. The Borrower shall
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preserve all of its rights, privileges and franchises necessary or desirable in
the normal conduct of its business; conduct its business in an orderly,
efficient and regular manner; and shall not liquidate, merge, dissolve, suspend
business operations, or sell all or substantially all of its assets.

(E)     COMPLIANCE WITH APPLICABLE LAWS. The Borrower shall comply with the
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requirements of all applicable local, state and federal laws, and of all rules,
regulations and orders of any governmental or other authority or agency, a
breach of which would materially and adversely affect its business or credit,
except where contested in good faith and by proper proceedings.

(F)     ACCESS TO BOOKS AND INSPECTION. The Borrower shall at all times keep
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proper books of record and accounts for itself, and, upon reasonable prior
notice given to the Borrower by the Lender, the Borrower shall provide any duly
authorized representative of the Lender access during normal business hours, and
permit such representative to examine, copy or make extracts from, any and all
books, records and documents in the Borrower's possession or control relating to
the Borrower's affairs, and to inspect any of its facilities and properties.

(G)     NON-BUSINESS ASSETS. The Borrower shall not purchase, lease or otherwise
        -------------------
acquire any right, title or interest in or to any real or personal property not
directly related to or necessary in connection with the present operations of
the Borrower.

(H)  GUARANTEES.  The Borrower shall not assume, guarantee, endorse or otherwise
     ----------
become  liable upon the obligation of any person, firm or corporation except for
the  guaranty  of  the indebtedness of entities in which ether of the Guarantors
has  day  to  day  management  authority  or  entities  in  which  either of the
Guarantors  (or family members of either of the Guarantors or trusts established
for  the  benefit of family members of either of the Guarantors) owns a majority
interest.

(I)     LITIGATION.  The  Borrower  shall promptly give notice in writing to the
        ----------
Lender  of  any  litigation  pending  or  threatened against the Borrower or the
Guarantors.

                                 ARTICLE IV
                                 CONDITIONS

The obligation of the Lender to issue the Revolving Line is subject to the
fulfillment to the Lender's satisfaction, of all of the following conditions:

(A)     Approval of Lender's Counsel.    All legal matters including incidental
        ----------------------------
to the Revolving Line shall be satisfactory to the Lender's counsel.

(B)     Documentation.     The  Lender  shall have  received,  in form and
substance satisfactory to the Lender, each of the following, duly executed:

        (i)    This Agreement;
        (ii)   Note;
        (iii)  Guaranties;
        (iv)   Pledge and Security Agreement executed by Borrower;
        (v)    Pledge and Security Agreement executed by Robert D. Furst, Jr.;
        (vi)   Pledge and Security Agreement executed by Peter L. Murdoch;

Such other papers and documents as may be required by this Agreement or as the
Lender may otherwise reasonably require.

                                  ARTICLE V
                        EVENTS OF DEFAULT; REMEDIES

SECTION 5.1. EVENTS OF DEFAULT.    The occurrence of any of the following shall
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constitute an "Event of Default" under this Agreement:
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(A)     The Borrower or either of the Guarantors shall fail to pay, when due,
any amounts required to be paid under any of the Loan Documents or the
Guaranties.

(B)     Any financial statement or certificate furnished to the Lender in
connection with, or any representation or warranty made by the Borrower or
either of the Guarantors under this Agreement, any other Loan Document or the
Guaranties shall prove to be incorrect, false or misleading in any material
respect when furnished or made.

(C)     Any default in the performance of or compliance with any obligation,
agreement or other provision contained herein or in any other Loan Document or
Guaranties (other than those referred to in subsections (a) and (b) above), and
with respect to any such default which by its nature can be cured, such default
shall continue for a period of twenty (20) days from its occurrence.

(D)     Any default in the payment or performance of any obligation, or any
defined Events of Default, under the terms of any contract or instrument (other
than any of the Loan Documents) pursuant to which the Borrower or either of the
Guarantors has incurred any debt or other liability to any person or entity,
including the Lender.

(E)     The filing of a notice of judgment lien against the Borrower or either
of the Guarantors that is not discharged or satisfied within thirty (30) days
thereafter.

(F)     The Borrower or either of the Guarantors shall become insolvent, or
shall suffer or consent to or apply for the appointment of a receiver, trustee,
custodian or liquidator of itself or any of his or its property, or shall
generally fail to pay his or its debts as they become due, or shall make a
general assignment for the benefit of creditors; the Borrowers or either of the
Guarantors shall file a voluntary petition in bankruptcy, or seeking
reorganization, in order to effect a plan or other arrangement with creditors or
any other relief under the Bankruptcy Reform Act, Title 11 of the United States
Code, as amended or recodified from time to time ("Bankruptcy Code"), or under
any state or federal law granting relief to debtors, whether now or hereafter in
effect; or any involuntary petition or proceeding pursuant to the Bankruptcy
Code or any other applicable state or federal law relating to bankruptcy,
reorganization or other relief for debtors is filed or commenced against the
Borrower or either of the Guarantors and such party shall file an answer
admitting the jurisdiction of the court and the material allegations of any
involuntary petition; or the Borrower or either of the Guarantors shall be
adjudicated a bankrupt, or an order for relief shall be entered against the
Borrower or either of the Guarantors by any court of competent jurisdiction
under the Bankruptcy Code or any other applicable state or federal law relating
to bankruptcy, reorganization or other relief for debtors.

(G)     There shall exist or occur any event or condition which the Lender in
good faith believes impairs, or is substantially likely to impair, the prospect
of payment or performance by the Borrower or either of the Guarantors of its or
his obligations under any of the Loan Documents or the Guaranties.

(H)  The  death  or  incapacity  of  either  of  the Guarantors and a substitute
guarantor  acceptable  to  the  Lender in its sole and absolute discretion shall
fail to guaranty the Note within one hundred twenty (120) days after the date of
death  or  incapacity  (during  such  120  day period no Advance may be obtained
hereunder  without  the  prior  written  consent  of  the  Lender).

SECTION 5.2. REMEDIES.
             --------

(A)     Upon the occurrence of an Event of Default or at any time thereafter,
the Lender may (a) terminate the Revolving Line, and/or (b) declare, at the
Lender's option and without notice, the unpaid principal balance of, plus
accrued interest on the Note, plus all indebtedness of the Borrower under each
of the Loan Documents, any term thereof to the contrary notwithstanding,
immediately due and payable without presentment, demand, protest or notice of
dishonor, all of which are hereby expressly waived by the Borrower; (c) the
obligation, if any, of the Lender to extend any further credit under the
Revolving Line or any of the Loan Documents shall immediately cease and
terminate; (d) the Lender shall have all rights, powers and remedies available
under each of the Loan Documents, or accorded by law, including without
limitation the right to resort to any or all security for any credit subject
hereto and to exercise any or all of the rights of a beneficiary or secured
party pursuant to applicable law.   All rights, powers and remedies of the
Lender may be exercised at any time by the Lender and from time to time after
the occurrence of an Event of Default, are cumulative and not exclusive, and
shall be in addition to any other rights, powers or remedies provided by law or
equity.

(B)     Lender shall not be required to first resort for payment to the Borrower
or any other person, corporation or entity, or their properties or estates, or
any other right or remedy whatsoever, prior to enforcing the Guaranties. Lender
may demand payment from the Guarantors of any installment (or portion thereof)
of principal or interest on the Note at any time, and the Guarantors shall
immediately pay the same to the Lender, and the Lender may demand payment or
performance of any other obligation under the Loan Documents at any time and the
Guarantors shall immediately pay or perform the same, whether or not the Lender
has (i) declared an Event of Default hereunder, or (ii) accelerated payment of
the Note, or (iii) commenced repossession of, or foreclosure of any security
interest, mortgage or other lien in, any or all of the collateral securing the
Note, or (iv) otherwise exercised its rights and remedies hereunder or under the
Note, the Loan Documents or applicable law.

                                  ARTICLE VI
                                 MISCELLANEOUS

SECTION  6.1.  TERM.  Unless  sooner  terminated  by the parties pursuant to the
               ----
provisions  hereof, the original term of this Agreement shall commence as of the
date  hereof and continue thereafter until the obligations of the Borrower under
the  Loan  Documents  have  been paid in full and the Revolving Line established
hereunder  has  expired  on  the Revolving Credit Expiration Date. The Revolving
Line  shall automatically terminate, without notice and without the necessity of
any  other  action  by  the  Lender  or  the  Borrower,  on the Revolving Credit
Expiration  Date. Notwithstanding anything to the contrary contained herein, the
Lender shall not be obligated to extend the original or any extended term hereof
pursuant  to  this Section under any circumstances or conditions whatsoever, and
the  Borrower  hereby  acknowledges that the Lender has not agreed, warranted or
represented  in any manner whatsoever that it would so extend the Revolving Line
established  hereunder pursuant to this Section or otherwise. The Borrower shall
be  entitled  to  terminate the Revolving Line established hereunder at any time
the  then  outstanding and unpaid balances of the Note and all other Obligations
and  indebtedness  under  the  Revolving Line and all Loan Documents are zero by
giving  thirty (30) days prior written notice of said termination to the Lender.

SECTION  6.2.  NO  WAIVER.  No delay, failure or discontinuance of the Lender in
               ----------
exercising  any  right,  power  or  remedy under any of the Loan Documents shall
affect  or  operate  as  a  waiver of such right, power or remedy; nor shall any
single or partial exercise of any such right, power or remedy preclude, waive or
otherwise  affect  any  other or further exercise thereof or the exercise of any
other  right  or  remedy. Any waiver, permit, consent or approval of any kind by
the  Lender  of any breach of or default under any of the Loan Documents must be
in  writing and shall be effective only to the extent set forth in such writing.

SECTION  6.3. OPTION TO PURCHASE. Lender hereby grants to each of the Guarantors
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an  option  (the  "Option")  to  purchase from Lender and assume Lender's right,
title  and interest in and to the Revolving Line and the associated loan made by
Lender  to Borrower as evidenced by the Note (the "Option Property"). The Option
shall  be exercisable at any time from and after the date hereof through June 1,
2007  (the  "Option Termination Date"). The Option may be exercised by either of
             -----------------------
the Guarantors (but only by one of the Guarantors) by delivery of written notice
of  intention  to exercise the Option (the "Exercise Notice") received by Lender
                                            ---------------
not  less  than  fifteen  (15)  days  prior  to  the date on which the Guarantor
exercising  the  Option  desires  to  complete  the  sale and assumption of loan
transaction.  The  first  Exercise  Notice  received  by Lender shall deemed the
exercise  of  the  Option  and  the Guarantor who delivered such Exercise Notice
shall be the "Exercising Guarantor". All rights to exercise the Option as to the
              --------------------
non-Exercising  Guarantor  shall  immediately terminate upon the delivery of the
first Exercise Notice to Lender. The purchase price to be paid by the Exercising
Guarantor  to  Lender  for  the Option Property shall be the aggregate of unpaid
principal  balance  of  Note,  plus  accrued  interest  on  the  Note,  plus all
indebtedness  of the Borrower under each of the Loan Documents, plus any and all
costs  and  fees  (including  Lender's  reasonable  attorneys'  fees  and costs)
incurred by Lender in completing the sale and assignment of the Option Property.

SECTION  6.4.  NOTICES.  All  notices,  consents, requests and demands which any
               -------
party  is  required or may desire to give to any other party under any provision
of  this  Agreement  must be in writing delivered to each party at the following
address:

IF TO LENDER:       Tradition Capital Bank
                    7601 France Avenue South, Suite 140
                    Edina, Minnesota 55435
                    Facsimile No.: (612)806-6629
                    Attn: Vonda Wurzburger

IF TO BORROWER:     Sentry Technology Corporation
                    1881 Lakeland Avenue
                    Ronkonkoma, NY 11779
                    Facsimile No.:_____________
                    Attn:  __________________

or  to  such  other  address as any party may designate by written notice to all
other  parties.  Each  such  notice, request and demand shall be deemed given or
made  as  follows:  (a)  if sent by hand delivery, upon delivery; (b) if sent by
mail, upon the earlier of the date of receipt or three (3) days after deposit in
the  U.S.  mail,  registered  or  certified;  and  (c) if sent by telecopy, upon
receipt.

SECTION  6.5. COSTS. EXPENSES AND ATTORNEY'S FEES. The Borrower shall pay to the
              -----------------------------------
Lender  immediately  upon  demand  the  full  amount  of all payments, advances,
charges,  costs  and  expenses, including reasonable attorney's fees (to include
outside  counsel fees and all allocated costs of the Lender's in-house counsel),
expended  or  incurred  by the Lender in connection with (a) the negotiation and
preparation  of  this  Agreement  and  the  other  Loan  Documents, the Lender's
continued  administration  hereof  and  thereof,  and  the  preparation  of  any
amendments  and  waivers hereto and thereto, (b) the enforcement if the Lender's
rights and/or the collection of any amounts which become due to the Lender under
any  of  the  Loan Documents, and (c)the prosecution or defense of any action in
any  way related to any of the Loan Documents, including without limitation, any
action for declaratory relief, whether incurred at the trial or appellate level,
in  an  arbitration  proceeding or otherwise, and including any of the foregoing
incurred  in  connection  with  any  bankruptcy  proceeding  (including  without
limitation,  any adversary proceeding, contested matter or motion brought by the
Lender  or  any  other  person)  relating to the Borrower or any other person or
entity.

SECTION  6.6.  SUCCESSORS.  ASSIGNMENT. This Agreement shall be binding upon and
               -----------------------
inure  to  the  benefit  of  the  heirs,  executors,  administrators,  legal
representatives,  successors  and assigns of the parties; provided however, that
the  Borrower  may  not  assign  or transfer its interests hereunder without the
Lender's  prior  written consent. The Lender reserves the right to sell, assign,
transfer,  negotiate  or  grant  participations  in  all  or any part of, or any
interest  in, the Lender's rights and benefits under each of the Loan Documents.
In  connection  therewith, the Lender may disclose all documents and information
which the Lender now has or may hereafter acquire relating to any credit subject
hereto,  the  Borrower  or  its businesses or any collateral required hereunder.

SECTION  6.7.  ENTIRE  AGREEMENT:  AMENDMENT.  This  Agreement  and  other  Loan
               -----------------------------
Documents  constitute  the  entire agreement between the Borrower and the Lender
with respect to each credit subject hereto and supersede all prior negotiations,
communications,  discussions  and  correspondence  concerning the matter hereof.
This  Agreement  may be amended or modified only in writing signed by each party
hereto.

SECTION  6.8.  NO  THIRD PARTY BENEFICIARIES. This Agreement is made and entered
               -----------------------------
into  for  the  sole  protection  and  benefit  of  the  parties  hereto and the
respective permitted successors and assigns, and no other person or entity shall
be  a third party beneficiary of, or have any direct or indirect cause of action
or  claim  in connection with, this Agreement or any of the other Loan Documents
to  which  it,  he  or  she  is  not  a  party.

SECTION 6.9. INDEMNIFICATION. The Borrower hereby agrees to indemnify the Lender
             ---------------
for  any  and all liabilities, obligations, losses, damages, penalties, actions,
judgments,  suits,  costs,  expenses  or  disbursements  of  any kind and nature
whatsoever  which  may be imposed on, incurred by or asserted against the Lender
in  any  action by a third party relating to or arising out of the breach by the
Borrower  of  any  of the representations, warranties, covenants, or obligations
set  forth  in  the  Loan  Documents or the enforcement of such terms thereof or
therefor;  provided,  however,  that such parties shall not be liable for any of
the foregoing to the extent that they arise from the gross negligence or willful
misconduct  of  the  Lender.

SECTION  6.10.  TIME. Time is of the essence of each and every provision of this
                ----
Agreement  and  each  of  the  other  Loan  Documents.

SECTION  6.11.  SEVERABILITY  OF  PROVISIONS. If any provision of this Agreement
                ----------------------------
shall  be prohibited by or invalid under applicable law, such provision shall be
ineffective  only  to  the  extent  of  such  prohibition  or invalidity without
invalidating the remainder of such provision or any remaining provisions of this
Agreement.

SECTION  6.12.  HEADINGS.  The  descriptive headings for the several sections of
                --------
this  Agreement  are inserted for convenience only and shall not define or limit
any  of  the  terms  or  provisions  hereof.

SECTION  6.13.  GOVERNING LAW. This Agreement shall be governed by and construed
                -------------
in  accordance  with  the  laws  of  the  State  of  Minnesota.

SECTION  6.14.  WAIVER  OF  JURY  TRIAL.  THE  BORROWER  AND THE LENDER EACH (A)
                -----------------------
COVENANTS  AND  AGREES  NOT  TO  ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE
ARISING  OUT  OF  THIS  INSTRUMENT  OR  THE  RELATIONSHIP BETWEEN THE PARTIES AS
BORROWER  AND LENDER THAT IS TRIABLE OF RIGHT BY A JURY AND (B) WAIVES ANY RIGHT
TO  TRIAL  BY  JURY WITH RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT
EXISTS NOW OR IN THE FUTURE. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY
GIVEN  BY  EACH  PARTY,  KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT
LEGAL  COUNSEL.

SECTION  6.15.  COUNTERPARTS.  This  Agreement  may be executed in any number of
                ------------
counterparts, each of which when executed and delivered shall be deemed to be an
original, and all of which when taken together shall constitute one and the same
Agreement.

         (The remainder of this page has been intentionally left blank)

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first written above.

                              BORROWER:

                              SENTRY TECHNOLOGY CORPORATION, a
                              Delaware corporation

                              By:  __________________________________

                              Name:  ______________________________
                              Its:  _________________________________

                              LENDER:

                              TRADITION CAPITAL BANK, a Minnesota state
                              banking corporation

                              By:  ____________________________________

                              Name:  _________________________________

                              Its:  ____________________________________

12607.4 3010282V6ex10_1.htm

    
      

    

     

    Exhibti
10.1

    
       

      NON-NEGOTIABLE
PROMISSORY NOTE

       

      

      
        	
                $1,346,000.00

              	
                April
      10, 2008

              

      

      

       

      FOR VALUE
RECEIVED, POSITRON CORPORATION,
a publicly owned Texas corporation (“Borrower”), hereby covenants and
promises to pay to the order of IMAGIN MOLECULAR CORPORATION
publicly owned Delaware corporation (the “Holder”), One Million Three Hundred Forty-Six
Thousand Dollars ($1,367,000.00), in lawful money of the United States of
America, payable before December 31, 2008 (the “Due Date”) with interest at the
rate of eight percent (8%).  All principal, interest and other costs
hereunder shall be due and payable to the Holder of this Non-Negotiable
Promissory Note (the “Note").

      

      Borrower
shall have the right to prepay, without penalty, all or any part of the unpaid
balance of this Note at any time on five (5) days prior written notice;
provided, however, that any partial prepayment shall be applied upon the
installments of principal and interest in the inverse order of their becoming
due, and upon making any such prepayment in full, Borrower shall pay to the
Holder all interest owing pursuant to this Note.  Borrower shall not
be entitled to re-borrow any prepaid amounts of the principal, interest or other
costs or charges. Borrower is duly authorized to enter into this
Note.  This Note may not be assigned without the Holder’s prior
written permission.

      

      Further,
it is agreed that if any installment of principal and/or interest on this Note
is not paid when due, the entire unpaid portion of this Note and all sums
payable hereunder may be declared immediately due and payable at the option of
the Holder.  After the Due Date, whether by acceleration or otherwise,
interest shall accrue on the principal amount, and accrued interest thereon
remaining unpaid at an interest rate equal to 15% per annum or the highest
lawful rate, whichever is lower, until paid.   All payments of
principal and interest under this Note are to be made to the Holder at 104W.
Chestnut Street, #315, Hinsdale, Illinois 60521, or at such other address as the
Holder may, from time to time, designate in writing.

      

      Borrower
and the Holder acknowledge that the Note is enforceable, valid and binding upon
and by the parties hereto.  If for any reason, any court authority or
governmental entity declares this Note invalid, unlawful or against public
policy, then, the parties hereto acknowledge that the obligation of the Borrower
to repay the Note shall not be affected by such declaration.

      

      Borrower
shall pay to the Holder, on demand, each cost and expense (including, without
limitation, reasonable attorneys' fees and all costs of suit) incurred by the
Holder in (a) collecting any of the outstanding principal of this Note, any
interest owing pursuant to this Note and remaining unpaid, or any other amount
owing by Borrower to the Holder pursuant to this Note and remaining unpaid or
(b) preserving or exercising any right or remedy of the Holder pursuant to this
Note.

       

      
        
          
            Initials:
____

          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      All
amounts owing pursuant to this Note and remaining unpaid shall, without notice,
demand, presentment or protest of any kind (each of which is waived by Borrower)
automatically become due (a) if any of Borrower commences or has commenced
against it any bankruptcy or insolvency proceedings, (b) if all or substantially
all of the business, assets or interests of Borrower, are sold or transferred by
Borrower in any manner, or (c) an event of default occurs under the Pledge
Agreement.

      

      Failure
or delay by the Holder in exercising, or a single or partial exercise of any
power or right hereunder, shall not operate as a waiver thereof or of any other
power or right or preclude any future exercise of that or any other power or
right.  A waiver of any power or right hereunder shall be in writing,
shall be limited to the specific instance, and shall not be deemed a waiver of
such power or right in the future, or a waiver of any other power or
right.

      

      This Note
may only be amended, canceled or discharged, except upon satisfaction by the
Borrower of the obligations herein, in a writing signed by parties
herein.  This Note shall be binding upon and inure to the benefit of
(a) the heirs, executors and legal representatives of either Holder upon such
Holder’s death and (b) any successor of the Borrower.  Any such
successor of Borrower shall be deemed substituted for Borrower under the terms
of this Note for all purposes.  As used herein, “successor” shall
include any person, firm, corporation or other business entity which at any
time, whether by purchase, merger or otherwise, directly or indirectly acquires
all or substantially all of the assets or business of the Borrower.

      

      This Note
shall be construed and interpreted in accordance with the laws of the State of
New York without reference to conflict of laws principle.  Venue for
any action commenced by a party herein shall be proper if brought in the
appropriate court of competent jurisdiction in either the County New York
County, State of New York, United States.

      

      
        	
                Dated:

              	
                Houston,
      Texas

              	 
      
	 
      	
                April
      10, 2008

              	 
      

      

      

      
        	 
      	
                POSITRON
      CORPORATION

              	 
	 
      	 
      	 
	 
      	 
      	 
      	 
	 
      	
                By:

              	
                 

              	 
	 
      	
                Name:

              	
                Patrick
      Rooney

              	 
	 
      	
                Title:

              	
                Chairman

              	 

      

      

         

        Initials:
____

        2

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