Document:

Exhibit 10.21

 

Ness
Energy International, Inc. 

 

AGREEMENT

 

This
Agreement (this “Agreement”) is executed and effective on the 28th day of
February, 2005, by and between Ness Energy International, Inc., a Washington
corporation (the “Company”), and
Shannon K Stephens, Donna K Hendrick, Mary Gene Stephens, Ples R. Tillery, and
Judson F Hoover (the
“Executive”). 

 

RECITALS 

 

A. The
Company and the Executive entered into that certain Agreement for Grant of
Performance Shares (the “Agreement for Grant”) dated as of February 19, 2005, to
provide that performance shares would be granted to the Executive in the event
of a Change in Control of the Company. 

 

B. The
Company and the Executive desire to amend and restate the Agreement for Grant.

 

WITNESSETH:

 

WHEREAS,
the Board of Directors of the Company (as hereinafter defined) recognize that
the current business environment makes it difficult to attract and retain highly
qualified key employees unless a certain degree of security can be offered to
such individuals against organizational and personnel changes which frequently
follow a Change in Control (as defined below) of a corporation; and

 

WHEREAS,
even rumors of acquisitions or mergers may cause key employees to consider major
career changes in an effort to ensure financial security for themselves and
their families; and 

 

WHEREAS,
the Company desires to ensure fair treatment of its key employees in the event
of a Change in Control and to allow them to make critical career decisions
without undue time pressure and financial uncertainty; and 

 

WHEREAS,
the Company recognizes that its key employees will be involved in evaluating or
negotiating any offers, proposals or other transactions which could result in a
Change in Control of the Company and believes that it is in the best interest of
the Company and its stockholders for such key employees to be in a position,
free from personal, financial and employment considerations, to assess
objectively and pursue 

aggressively
the interests of the Company and its stockholders in making these evaluations
and carrying on such negotiations; and 

 

NOW,
THEREFORE, for and in consideration of the mutual promises, covenants and
obligations contained herein, the Company and the Executive agree as follows:

 

ARTICLE
I 

DEFINITIONS

 

As used
herein, the following words and phrases shall have the following respective
meanings unless the context clearly indicates otherwise. 

 

1.1
Board. The
Board of Directors of the Company. 

 

1.2
Change
in Control. A
“Change in Control” shall mean any one of the following: 

 

(a)
“Continuing Directors” no longer constitute a majority of the Board; the term
“Continuing Director” means any individual who is a member of the Board on the
date hereof or was nominated for election as a director by, or whose nomination
as a director was approved by, the Board with the affirmative vote of a majority
of the Continuing Directors; 

 

(b) any
person or group of persons (as defined in Rule 13d-5 under the Securities
Exchange Act of 1934, as amended (“Exchange Act”)) together with his or its
affiliates, becomes the beneficial owner, directly or indirectly, of 25% or more
of the voting power of the Company’s then outstanding securities entitled
generally to vote for the election of the Company’s directors; 

 

(c) the
merger or consolidation to which the Company is a party if the shareholders of
the Company immediately prior to the effective date of such merger or
consolidation have beneficial ownership (as defined in Rule 13d-3 under the
Exchange Act) of less than 50% of the combined voting power to vote for the
election of directors of the surviving corporation or other entity following the
effective date of such merger or consolidation; or 

 

(d) the
sale of, or transfer of ownership of all or substantially all of the assets of
the Company or the liquidation or dissolution of the Company. 

 

Notwithstanding
anything herein to the contrary, under no circumstances will a change in the
constitution of the board of directors of any Subsidiary, a change in the
beneficial ownership of any Subsidiary, the merger or consolidation of a
Subsidiary with any other entity, the sale of all or substantially all of the
assets of any Subsidiary or the liquidation or dissolution of any Subsidiary
constitute a “Change in Control” under this Plan. 

For
purposes of this Agreement, if the Executive’s employment with the Company is
terminated by the Company other than for “Cause” prior to the date on which a
Change in Control occurs, and it is reasonably demonstrated that such
termination (i) was at the request of a third party who has taken steps
reasonably calculated to effect a Change in Control or (ii) otherwise arose in
connection with a Change in Control, then for all purposes hereof, such
termination shall be deemed to have occurred immediately following a Change in
Control. 

 

1.3
Common
Stock. The
common stock, no par value share, which the Company is currently authorized to
issue or may in the future be authorized to issue, or any securities into which
or for which the common stock of the Company may be converted or exchanged, as
the case may be. 

 

1.4 Board
of Directors. The Board of Directors of the Company. 

 

1.5
Fair
Market Value. The
average of the high and low sales price on the date of the Change in Control or
on the next business day, if such day is not a business day, or if no trading
occurred on such day, then on the first day preceding such day on which trading
occurred, of a share of Common Stock traded on the OTC Exchange, or any other
public securities market selected by the Board of Directos; provided, however,
that, if shares of Common Stock shall not have been traded on the OTC Exchange
or other public securities market for more than 10 days immediately preceding
such date or if deemed appropriate by the Compensation Committee for any other
reason, the Fair Market Value of shares of Common Stock shall be as determined
by the Board of Directors in such other manner as it may deem appropriate.

 

ARTICLE
II 

PAYMENT
UPON CHANGE IN CONTROL 

 

2.1
Cash
Payment. The
Company shall pay to the Executive, in one lump-sum cash payment within five (5)
days after the date of the Change in Control, an amount equal to the Fair Market
Value of [SEE
EXHIBIT A ATTACHED FOR NUMBER OF SHARES FOR EACH INDIVIDUAL]
shares of
Common Stock as of the date of the Change in Control. 

 

2.2
Adjustments. In the
event that any dividend or other distribution (whether in the form of cash,
Common Stock, other securities, or other property), recapitalization, stock
split, reverse stock split, rights offering, reorganization, merger,
consolidation, split-up, spin-off, split-off, combination, subdivision,
repurchase, or exchange of Common Stock or other securities of the Company,
issuance of warrants or other rights to purchase Common Stock or other
securities of the Company, or other similar corporate transaction or event
affects the Common Stock such that an adjustment is determined by 

the
Compensation Committee to be appropriate to prevent the dilution or enlargement
of the benefits or potential benefits intended to be made available under this
Agreement, then the Compensation Committee shall adjust the number of Common
Stock stated in Section 2.1 above. 

 

2.3
No
Set-off of Amounts Payable Hereunder. The
Company’s obligations hereunder also shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the
Company may have against the Executive. 

 

2.4
Gross-Up
Payment. In the
event it shall be determined that any payment or distribution of any type by the
Company to or for the benefit of the Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise (the “Total Payments”), would be subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”) or
any interest or penalties with respect to such excise tax (such excise tax,
together with any such interest and penalties, are collectively referred to as
the “Excise Tax”), then the Executive shall be entitled to receive an additional
payment (a “Gross-Up Payment”) in an amount such that at the time of payment by
the Executive of all taxes (including additional excise taxes under said Section
4999 and any interest, and penalties imposed with respect to any taxes) imposed
upon the Gross-Up Payment, the Executive shall have an amount of the Gross-Up
Payment equal to the Excise Tax imposed upon the Total Payments. The calculation
of the Gross-Up Payment will be made in the same manner and in conjunction with
any similar calculation of a gross-up payment under the terms of the Severance
Plan or any employment agreement, if applicable. The Company shall pay the
Gross-Up Payment to the Executive on the same date as the gross-up payment is
paid under the Severance Plan or any employment agreement, if applicable, or, if
no payment is to be made under the Severance Plan or an employment agreement,
within twenty (20) business days after the payment is made hereunder.

ARTICLE
III 

SUCCESSORS
TO COMPANY 

 

This
Agreement shall bind any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
and/or assets of the Company, in the same manner and to the same extent that the
Company would be obligated under this Agreement if no succession had taken
place. In the case of any transaction in which a successor would not, by the
foregoing provision or by operation of law, be bound by this Agreement, the
Company shall require such successor expressly and unconditionally to assume and
agree to perform the Company’s obligations under this Agreement, in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place. Failure of the Company to obtain such
agreement prior to the effectiveness of any such succession shall be a breach
hereof and shall entitle the Executive to compensation from the Company in the
same amount and on the same terms as the Executive would be entitled hereunder.
As used herein, “the Company” shall mean the Company as hereinbefore defined and
any successor to its business and/or assets as aforesaid which executes and
delivers the agreement provided for in this Article
III or which
otherwise becomes bound by all the terms and provisions hereof by operation of
law. 

 

ARTICLE
IV 

DURATION
AND AMENDMENT 

 

4.1
Duration. This
Agreement shall continue in effect until terminated in accordance with
Section
4.2. If a
Change in Control occurs, this Agreement shall continue in full force and
effect, and shall not terminate or expire, until after the Executive shall have
received all of benefits to which he is entitled hereunder in full.

 

4.2
Amendment
or Termination. This
Agreement may not be amended or terminated except by a mutual written agreement
signed by all parties. 

 

ARTICLE
V 

MISCELLANEOUS

 

5.1
Notices. All
notices, requests, demands and other communications required or permitted to be
given under this Agreement shall be in writing and shall be deemed to have been
duly given on the date of service if served personally on the party to whom
notice is to be given and acknowledged by written receipt, or on the seventh day
after mailing if mailed (return receipt requested), postage prepaid and properly
addressed as follows: 

	 	 	 	 	 
	
       

      Company:
	
        
	
       
	
        
	
       

      Ness
      Energy International, Inc

					
	
       
	
        
	
       
	
        
	
       

      4102
      I-20 East Service Road810 Houston Street

	
       
	
        
	
       
	
        
	
       

      Willow
      Park, Texas 76087

	
       
	
        
	
       
	
        
	
       

      Attention:
      Board of Directors

	 	 	 
	
       

      Executive:

       
	
        
	
       
	
        
	
       

      [Address
      of each executive.]

       

					

 

Any party
may change its address for purposes of this Section
5.1 by
giving the other party written notice of the new address in the manner set forth
above. 

 

5.2
Assignment;
Binding Effect. Neither
this Agreement nor any of the rights or obligations hereunder may be assigned by
any party without the prior written consent of the other party. This Agreement
is binding upon and inures to the benefit of Executive and Company and their
respective heirs, personal representatives and permitted successors and assigns.

 

5.3
Governing
Law. This
Agreement shall be governed by, and construed and enforced in accordance with,
the laws of the State of Texas. 

 

5.4
Waiver. Any
waiver by any party of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any subsequent breach thereof or of any
other provision of this Agreement. 

 

5.5
Entire
Agreement. This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes any and all prior and
contemporaneous promises, agreements and representations not set forth in this
Agreement. 

 

5.6
Severability. Should
any one or more of the provisions hereof be determined to be illegal or
unenforceable, all other provisions hereof shall be given effect separately
there from and shall not be affected thereby. 

 

5.7
Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which together will constitute one and the
same agreement. 

 

5.8
Dispute
Resolution. Any
dispute, controversy or claim arising out of or in relation to or connection to
this Agreement, including without limitation any dispute as to the construction,
validity, interpretation, enforceability or breach of this Agreement, shall be
exclusively and finally settled by arbitration, and any party may submit such
dispute, controversy or claim to arbitration. 

 

(a)
Arbitrator. The
arbitration shall be heard and determined by one arbitrator, who shall be
impartial and who shall be selected by mutual agreement of the parties. If the
parties cannot agree on the arbitrator, then the appointing authority for the
implementation of such procedure shall be the Chief Executive Officer of the
American Arbitration Association, who shall appoint an independent arbitrator
who does not have any financial interest in the dispute, controversy or claim.

 

(b)
Proceedings. Unless
otherwise expressly agreed in writing by the parties to the arbitration
proceedings: 

 

(i) The
arbitration proceedings shall be held in Fort Worth, Texas, at a site chosen by
mutual agreement of the parties, or if the parties cannot reach agreement on a
location within thirty (30) days of the appointment of the arbitrator, then at a
site chosen by the arbitrator; 

 

(ii) The
arbitrator shall be and remain at all times wholly independent and impartial;

 

(iii) The
arbitration proceedings shall be conducted in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, as amended from time
to time; 

 

(iv) Any
procedural issues not determined under the arbitral rules selected pursuant to
item (iii) above shall be determined by the law of the place of arbitration,
other than those laws which would refer the matter to another jurisdiction;

 

(v) The
costs of the arbitration proceedings (including attorneys’ fees and costs) shall
be borne in the manner determined by the arbitrator; 

 

(vi) The
decision of the arbitrator shall be reduced to writing; final and binding
without the right of appeal; the sole and exclusive remedy regarding any claims,
counterclaims, issues or accounting presented to the arbitrator; made and
promptly paid in United States dollars free of any deduction or offset; and any
costs or fees incident to enforcing the award shall, to the maximum extent
permitted by law, be charged against the party resisting such enforcement;

 

(vii) The
award shall include interest from the date of any breach or violation of this
Agreement, as determined by the arbitral award, and from the date of the award
until paid in full, at 12% per annum; and 

 

(viii)
Judgment upon the award may be entered in any court having jurisdiction over the
person or the assets of the party owing the judgment or application may be made
to such court for a judicial acceptance of the award and an order of
enforcement, as the case may be. 

(c)
Acknowledgment
Of Parties. Each
party acknowledges that he or she or it has voluntarily and knowingly entered
into an agreement to arbitration under this Section by executing this Agreement.

 

5.9
Employment
Status. This
Agreement does not constitute a contract of employment or impose on the Company
any obligation to retain the Executive as an employee. 

 

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

 

	 	 	 
	
       

       Ness
      Energy International, Inc.

	 	 
	
       

       

       
	
      By:
	
         /S/
      Shannon K
      Stephens                                                                                                                             
      

	
       
		
         

        
       Name:  Shannon K Stephens

       

	
       
	
       
	
      Title:    President,
      and Chief Executive Officer

       

       

         ____________________________________

	
       
	
       
	
       

         
      EXECUTIVE

       

Exhibit A

 

Section
2.1 

 

	 	 	 	 	 
	
       

      Shannon
      K Stephens, 500 Looney Lane, Weatherford TX 76087

       
	
        
	
       

      4,375,000
      Share

       
	
        
	
       

	
       

      Donna
      K Hendrick, 315 FM 3137, Palo Pinto TX 76484

       
	
        
	
       

      1,0750,000
      Shares

       
	
        
	
       

	
       

      Ples
      R Tiller, 104 Yorkshire Ct, Weatherford, TX 76087

       
	
        
	
       

      1,075,000
      shares

       
	
        
	
       

	
       

      Mary
      Gene Stephens, 365 Cook Rd, Weatherford TX 76087

       
	
        
	
       

      1,800,000
      shares

       
	
        
	
       

	
       

      Judson
      F Hoover, 104 Thistle Ct, Highland Village TX 75077

       
	
       
	
       

      2,800,000
      sharesUnassociated Document

Exhibit
10.1

THIRD MASTER LOAN DOCUMENTS MODIFICATION
AGREEMENT

This THIRD
MASTER LOAN DOCUMENTS MODIFICATION AGREEMENT (the "Agreement") dated as
of the 14th day of April, 2005, is by and between WACHOVIA BANK,
NATIONAL ASSOCIATION (the “Bank”), as successor by
merger to SOUTHTRUST BANK, and TECHNOLOGY RESEARCH
CORPORATION and TECHNOLOGY RESEARCH CORPORATION / HONDURAS ,
S.A. DE C.V. (the "Borrowers").

 

RECITALS:

A.  The Bank
and the Borrowers are party to a Business Loan Agreement dated as of November
12, 2002 heretofore modified and amended by a Master Loan Documents Modification
Agreement (the “2003 Modification Agreement”) dated as of November 12, 2003 and
by a Second Master Loan Documents Modification Agreement (the “2004 Modification
Agreement”) dated as of December 20, 2004 (collectively, the “Loan Agreement”)
pursuant to which the Bank has made a revolving line of credit available to
Borrowers in the principal amount of up to $6,000,000.00 outstanding at any
time.

B.  Borrowers’
obligation to repay advances made by the Bank pursuant to the Loan Agreement is
evidenced by a 2004 Renewal Note dated as of December 20, 2004 (the “2004
Renewal Note”). The Bank is the owner and holder of the Revolving Note. 

C.  Borrowers’
obligations under the Loan Agreement and the 2004 Renewal Note are secured by a
Commercial Security Agreement dated as of November 12, 2002, as amended by the
2003 Modification Agreement and by the 2004 Modification Agreement
(collectively, the “Security Agreement”) and by a security interest in favor of
the Bank, as secured party, in the collateral described in the Security
Agreement.

D.  The Loan
Agreement, the 2004 Renewal Note, the Security Agreement and all loan
agreements, financing statements and documents executed in connection with the
transactions contemplated thereby are referred to collectively herein as the
“Loan Documents”.

E.  The
Borrowers have requested the Bank to make a non-revolving term loan to the
Borrowers in the amount of $3,000,000.00 and the Bank is willing to do so as
provided in this Agreement;

NOW,
THEREFORE, in consideration of the premises, and of the mutual promises
hereafter set forth, and the sum of Ten Dollars ($10.00) paid each to the other,
the receipt and sufficiency of which as consideration is hereby acknowledged,
the parties agree as follows:

1.
 THE RECITALS. The parties acknowledge and agree that the
facts stated in the recitals above are true and correct and the parties
incorporate such recitals in this Agreement as a part thereof for all
purposes.

2.
 THE LOAN AGREEMENT. 

(a)  The Loan
Agreement is hereby amended to reflect and to provide that the Lender described
therein is Wachovia Bank, National Association, as successor by merger to
SouthTrust Bank.

(b)  The Loan
Agreement is hereby amended to add the following provisions, which shall be
deemed to be a schedule relating to an additional Loan as contemplated by the
first paragraph of the Loan Agreement:

The 2005 Term Loan. The Lender hereby agrees to
make a term loan (the “2005 Term Loan”) to the Borrowers in the amount of
THREE MILLION DOLLARS ($3,000,000.00). The Borrowers’
obligation to repay the 2005 Term Loan to the Lender shall be evidenced by a
promissory note (the “2005 Term Loan Note”) of the Borrowers in form acceptable
to the Lender dated as of the date of closing and disbursement of the 2005 Term
Loan. The 2005 Term Loan shall be payable as to principal and interest at the
times and in the amounts provided in the 2005 Term Loan Note. The 2005 Term Loan
shall mature, and be payable in full as to principal and interest, on October
14, 2005. There is no revolving feature to the 2005 Term Loan and Borrowers may
not reborrow any sums repaid thereunder.

(c)  The Loan
Agreement is hereby amended to revise the following definition to read as
follows:

“Note” or “Notes” means, singly or collectively
as the context may require, all promissory notes of the Borrowers evidencing an
obligation to repay Loans to the Lender including, without limitation, the 2004
Renewal Note and the 2005 Term Loan Note, together with all renewals,
extensions, modifications, refinancings, consolidations and substitutions
thereof or therefore.

3. 
SECURITY AGREEMENT. The Security Agreement is hereby modified
and shall be deemed to provide that the secured party described therein is
Wachovia Bank, National Association, as successor by merger to SouthTrust Bank;
and that the Security Agreement continues in full force and effect and continues
to secure equally, ratably and in pari passu all Loans owed by the
Borrowers to the Bank including, without limitation, the Loans evidenced by the
2004 Renewal Note and the 2005 Term Loan Note. 

4. 
LOAN DOCUMENTS MODIFICATION. Each of the Loan Documents are
hereby modified to reflect that the lender described therein is Wachovia Bank,
National Association, as successor by merger to SouthTrust Bank; and that each
of the Loan Documents shall apply to and secure all Loans owed by the Borrowers
to the Bank including, without limitation the Loans evidenced by the 2004
Renewal Note and the 2005 Term Loan Note, and all modifications, amendments,
renewals and extensions thereof, equally, ratably and in pari
passu.

5.
 NOVATION. Except as provided in this Agreement, the
obligations evidenced by the Loan Agreement, the Notes, the Security Agreement
and the other Loan Documents are unaffected, unchanged and unimpaired. By
entering into this Agreement, the parties have no intention whatsoever to
extinguish or discharge the indebtedness evidenced by the Note, or to affect any
novation or to release or discharge the lien and security interest create by the
Security Agreement. 

6.
 WAIVER OF DEFENSES. As an important inducement and as
additional consideration to the Bank, the Borrowers, for themselves and for
their respective successors, heirs and assigns to the extent permitted by law,
each hereby waive and agree not to assert as a defense to any action for
collection of the 2004 Renewal Note or the 2005 Term Loan Note or for
foreclosure of the security interests created by the Security Agreement, any
defense which it now has or which may arise in the future under the Loan
Documents or the 2004 Renewal Note or the 2005 Term Loan Note by reason of any
act or omission by the Bank, its agents or employees heretofore taken or omitted
to be taken and in any way connected with the transactions evidenced or
contemplated by the Loan Documents or the 2004 Renewal Note or the 2005 Term
Loan Note, including, without limitation, any such acts or omissions relating to
required disclosures which Borrower acknowledge have been made in full and fair
manner as may be required by law.

     
7.  PAYMENT OF EXCISE AND INTANGIBLE TAXES. Borrowers
agree to pay in full, concurrently with the execution hereof, or subsequent
thereto if not fully paid, any and all documentary and intangible taxes due on
the 2005 Term Loan Note or any renewal or modification thereof or on this
Agreement and other excise taxes, together with interest and penalties, if any,
determined to be due on delinquent or unpaid amounts. Borrowers further agree to
indemnify and save the Bank harmless from any and all such taxes and charges
later determined to be due.

8.
 CLOSING COSTS AND ATTORNEYS' FEES. Borrowers shall pay
all closing costs, including, without limitation, the reasonable attorneys' fees
incurred by the Bank in connection with this Agreement and any related
documents.

10.
 MISCELLANEOUS. This Agreement contains the final,
complete, and exclusive expression of the understanding between the parties
regarding the transactions contemplated by it. A waiver or modification of any
provisions of this Agreement is valid only if the waiver or modification is in
writing signed by each party. The failure or delay by the Bank to exercise any
right, power or privilege under this Agreement will not operate as a waiver of
any such right, power or privilege. The titles and headings preceding the text
of the sections of this Agreement have been inserted solely for convenience of
reference and do not affect this Agreement's meaning or effect. This Agreement
is a Florida contract and it is the intent of the parties that it be construed
according to the laws of the State of Florida. Borrowers may not assign their
interest in this Agreement without the prior written approval of the Bank, and
this Agreement binds the successors and assigns of the parties.

  

IN WITNESS
WHEREOF, the parties have executed this Agreement as of the date set
forth above.

TECHNOLOGY
RESEARCH                 TECHNOLOGY
RESEARCH

CORPORATION                                    
CORPORATION/ HONDURAS , S.A. DE
C.V.

 

By:    /s/ Scott J.
Loucks                     
         By:    /s/
Scott J.
Loucks                           

Name:   Scott J.
Loucks                               
Name:   Scott J. Loucks

Title:   VP Finance,
CFO                              
Title:  Secretary

WACHOVIA BANK,

NATIONAL ASSOCIATION

By:    /s/ Timothy J.
Coop                            

Name:     Timothy J. Coop

Title:  Senior Vice President

 

 

2005 TERM LOAN NOTE

$3,000,000.00                                                                                                               April 14, 2005

Being indebted for
value received, TECHNOLOGY RESEARCH CORPORATION and TECHNOLOGY RESEARCH
CORPORATION / HONDURAS, S.A. DE C.V. (collectively, jointly and
severally, the "Borrowers"), jointly and severally promise to pay to
WACHOVIA BANK, NATIONAL ASSOCIATION, as successor by merger to
SouthTrust Bank (the "Lender"), or order, at its at 225 Water Street,
Jacksonville, FL 32202, or at such other address as may be designated from time
to time by the holder hereof to the Borrower, the sum of THREE MILLION
DOLLARS ($3,000,000.00) together with interest on the unpaid balance
from the date of disbursement until maturity at a rate per annum equal to the
Applicable Rate as defined below. There is no revolving feature to this Note and
Borrowers may not reborrow any sums repaid hereunder. Interest shall accrue on
the basis of an assumed year of 360 days and shall be charged for the actual
number of days elapsed in an Interest Period. Notwithstanding anything in this
Note to the contrary, no Interest Period may end later than the Maturity Date
and if the Maturity Date falls in less than one month, then the interest rate
applicable to this Note shall not be the LIBOR Rate during the remaining term
but rather shall be the Base Rate. After the occurrence of an Event of Default,
the interest rate applicable to this Note may not be continued at or converted
to the LIBOR Rate but shall be the Default Rate.

The following
definitions shall apply for the purpose of determination of the interest rate
applicable to the Note from time to time:

 

"Applicable Rate" means either the LIBOR Rate or
the Base Rate or the Default Rate, as such interest rate may apply to the Loan
evidenced by this Note as provided herein.

 

 

“Base Rate” means a rate of interest equal to one
hundred (100) basis points below the rate quoted as the "prime rate" as reported
in the "Money Rates" section of the Wall Street Journal (or the arithmetic
average of the rates so quoted, if more than one rate is quoted) or, in the
event of discontinuance of such publication or such section thereof, the Base
Rate shall mean the monthly average prime rate as reported and published in the
Federal Reserve Bulletin published monthly by the Board of Governors of
the Federal Reserve System under the table styled "Prime Rate Charged by Banks
on Short Term Business Loans". In the event of the discontinuance of both such
publications or such section or table thereof, the Base Rate shall mean the
prime rate as from time to time announced or published by Citibank, N.A. at its
principal office in New York, New York.

The terms "Base Rate" and "prime rate" are intended by the parties
to be benchmarks only and are not to be construed as indicating that such rates
are the best or lowest rates offered by the Lender to any of its customers
regardless of their creditworthiness.

 

“Default Rate” means a rate per annum equal to
the highest rate then allowable by law, or 18%, whichever is lesser.

 

“Eurocurrency Reserve Percentage” means, with
respect to each Interest Period, a percentage (expressed as a decimal) equal to
the percentage in effect two Business Days prior to the first day of such
Interest Period, as prescribed by the Board of Governors of the Federal Reserve
System (or any successor), for determining reserve requirements applicable to
any "Eurocurrency liabilities" pursuant to Regulation D or any other applicable
regulation of the Board of Governors which prescribes reserve requirements
applicable to "Eurocurrency liabilities" as presently defined in Regulation
D.

 

“Interbank Rate” means, with respect to each
Interest Period, the rate per annum at which dollar deposits in immediately
available funds are offered to the Bank two Business Days prior to the beginning
of such Interest Period by major banks in the London interbank eurodollar market
as at or about 11:00 a.m. London time, for delivery on the first day of such
Interest Period, for the number of days comprised therein and in an amount
comparable to the amount of the Loan to which such Interest Period
relates.

“Interbank Rate (Reserve Adjusted)” means, for
any Interest Period, a rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) determined pursuant to the following formula:

Interbank
Rate             
=                   
          Interbank
Rate       _ 

(Reserve
Adjusted)                    
1 - Eurocurrency Reserve Percentage

"Interest Period" means, (i) when the applicable
interest rate is the Base Rate, one (1) day, and (ii) when the applicable
interest rate is the LIBOR Rate, the period commencing on the effective date of
Borrower’s election as provided hereinbelow and ending on (but excluding) the
day 30, 60 or 90 days thereafter, in either case as the Borrower may select in
its relevant notice to the Bank as provided in this Note, provided, however,
that

(a) if any Interest Period would otherwise end
on a day which is not a Business Day, such Interest Period shall end on the next
succeeding Business Day; and

(b) no Interest Period may end later than the
Maturity Date, provided that the Applicable Rate shall be the Base Rate
for any Interest Period of less than thirty (30) days by.

“LIBOR Rate” means an adjustable rate of interest
per annum equal to the Interbank Rate (Reserve Adjusted) plus 160 basis points,
fixed for Interest Periods of 30, 60 or 90 days. 

The Borrower shall
select the initial Applicable Rate to apply to the Loan by providing written
notice thereof (which may be by telefacsimile) to the Bank at least three (3)
Business Days prior to the date of this Note. If timely notice of the initial
Applicable Rate is not provided as required hereby, then the initial Applicable
Rate shall be the Base Rate. Subject to the provisions hereof, the Borrower
shall have the right to (i) continue the current Applicable Rate from time to
time, or (ii) to convert the Applicable from either the LIBOR Rate or the Base
Rate to the other, or (iii) to continue or change the Interest Period applicable
to the Loan while the Applicable Rate is the LIBOR Rate, in each case by
submitting to the Bank (effective upon receipt) (x) in the case of continuation
of the LIBOR Rate, and conversion of the Base Rate to the LIBOR Rate, at least
three (3) Business Days prior to the end of a current Interest Period, and (y)
in the case of conversion of the LIBOR Rate to the Base Rate, on or before 12:00
p.m. Eastern Time on the Business Day prior to the date on which the conversion
shall be effective, a written notice of Borrower’s election to continue the
Applicable Rate in its current form or to convert the Applicable Rate or to
continue or change the applicable Interest Period as described in said notice.
Such continuation or conversion shall take effect at the end of the current
Interest Period. If no such notice of election is received by the Bank from the
Borrower within the time prescribed prior to the end of a current Interest
Period, then the Applicable Rate shall be converted to the Base Rate. 

Notwithstanding
anything herein to the contrary, no Interest Period may end later than the
Maturity Date and if the Maturity Date falls in less than thirty (30) days, then
the Loan shall not accrue interest at the LIBOR Rate during the remaining term
but rather shall accrue interest at a rate per annum equal to the Base Rate.
After the occurrence and during the continuance of an Event of Default, the
interest rate may not be continued at a LIBOR Rate but shall be the Default
Rate.

If as a result of a
regulatory change the Bank shall reasonably determine that it is unlawful for
the Bank to make, continue or maintain any loan accruing interest at a LIBOR
Rate, the obligation of the Bank to continue or maintain the Loan evidenced by
this Note at a LIBOR Rate shall, upon such determination (and telephonic notice
thereof, to be subsequently confirmed in writing, to the Borrowers which notice
shall, in the absence of manifest error, create a rebuttable presumption as to
the effect of such regulatory change as specified above), forthwith be suspended
until the earliest date the Bank can determine and notify the Borrowers that the
circumstances causing such suspension no longer exist, and the LIBOR Rate
applicable to this Note shall automatically convert to the Base Rate on the last
day(s) of the then current respective Interest Period(s) with respect thereto or
sooner, if required by such regulatory change, provided that the Bank shall take
any reasonable actions available to it (including designation of its lending
offices) consistent with legal and regulatory restrictions that will avoid the
need for such suspension and will not, in the reasonable judgment of the Bank,
be otherwise materially disadvantageous to the Bank.

If the Bank shall
have reasonably determined that quotations of interest rates for the relevant
deposits referred to in the definition of "Interbank Rate" are not being
provided in the relevant amounts or for the relevant maturities for purposes of
determining rates of interest for LIBOR Rate determinations as provided herein
or that, by reason of circumstances affecting the London interbank eurodollar
market, adequate means do not exist for ascertaining the LIBOR Rate for any loan
to which such rate is the applicable rate, then, upon telephonic notice from the
Bank to the Borrowers to be subsequently confirmed in writing (such notice, in
the absence of manifest error, to create a rebuttable presumption as to the
effect specified above), the obligations of the Bank to continue the loan
evidenced by this Note at a LIBOR Rate shall forthwith be suspended and interest
shall accrue on principal outstanding under this Note at the Base Rate until the
earliest date that the Bank can reasonably determine and notify the Borrowers
that the circumstances causing such suspension no longer exist, provided that
the Bank shall take any reasonable actions available to it to obtain the
necessary quotations of interest rates in the London interbank eurodollar market
(or another eurodollar market acceptable to the Bank and to the
Borrowers).

In the event that
the Bank shall incur any loss or expense (including any loss or expense incurred
by reason of the liquidation or reemployment of deposits or other funds acquired
by the Bank to make, continue or maintain any portion of the principal amount of
any Loan at a LIBOR Rate) as a result of any repayment or prepayment of the
principal amount of any Loan on a date other than the scheduled last day of the
Interest Period applicable thereto then, upon written notice from the Bank to
the Borrowers the Borrowers shall, within five days of receipt thereof, pay
directly to the Bank such amount as will (in the reasonable determination of the
Bank) reimburse the Bank for such loss or expense. Such written notice shall, in
the absence of manifest error, create a rebuttable presumption of the amount of
such losses or expenses.

The Borrower shall
pay to Lender monthly installments of interest commencing with a payment due May
14, 2005 and on the same day of each month thereafter provided that all unpaid
principal plus accrued interest shall be due and payable and shall be paid on
October 14, 2005 (the “Maturity Date"). Payment shall be made at the Maturity
Date without demand, counterclaim, offset, deduction or defense, (whether now or
hereafter conferred by statute or otherwise.) 

All payments made
upon this Note shall be applied first to the payment of accrued interest and
thereafter in reduction of principal. 

Any payment not
received within ten (10) days when due shall be subject to, and it is agreed
that the holder hereof shall collect thereon, a "late charge" in the amount of
five percent (5%) of the amount of the delinquent payment to defray costs of
collection and losses of the holder. Said late charge shall be immediately due
and payable and shall be paid by the maker hereof without notice or demand by
the holder. The holder's entitlement to collect a late charge shall in no way
detract from or affect its right to accelerate payment of this Note in the event
of a failure by Borrower to make any payment hereunder when due.

Privilege is hereby
reserved to prepay the principal of this Note in whole or in part at any time
without notice, premium or penalty for the privilege of such prepayment;
provided, however, that payment of accrued interest shall be due and payable and
shall be paid at the time of and together with any such prepayment. 

Notwithstanding any
other provision of this Note or of any instrument securing this Note or any
other instrument executed in connection with the Loan evidenced hereby, it is
expressly agreed that amounts payable under this Note or under the other
aforesaid instruments for the payment of interest or any other payment in the
nature of or which would be considered as interest or other charge for the use
or loan of money shall not exceed the highest rate allowed by law, from time to
time, and in the event the provisions of this Note or of such other instruments
referred to above in this paragraph with respect to the payment of interest or
other charge for the use or loan of money shall result in exceeding such
limitation, then the excess over such limitation shall not be payable and the
amount otherwise agreed to have been paid shall be reduced by the excess so that
such limitation will not be exceeded, and if any payment actually made shall
result in such limitation being exceeded, the amount of the excess shall
constitute and be treated as a payment on the principal hereof and shall operate
to reduce such principal by the amount of such excess, or if in excess of the
principal indebtedness, such excess shall be refunded.

This Note shall be
in default upon the occurrence of any default or event of default under the
terms of this Note or any document executed in connection with the Loan
evidenced by this Note. In any event, this Note shall be in default upon failure
of the Borrower to make any payment hereunder when due, without notice or
demand. In the event of default the holder of this Note may, at its option,
declare all unpaid indebtedness evidenced by this Note and any modifications
thereof, immediately due and payable without notice regardless of the date of
maturity. Failure at any time to exercise this option shall not constitute a
waiver of the right to exercise the same at any other time. 

From and after the
stated, or if this Note is accelerated, the accelerated, maturity date of this
Note, it shall bear interest at the Default Rate. 

The parties
acknowledge that this Note may be assigned and that any holder of this Note
shall be entitled to recover directly against any endorser or guarantor hereof
without first proceeding against the Borrower or any other party.

Each Obligor (which
term shall mean and include each Borrower, endorser, guarantor and all others
who may become liable for all or any part of the obligations evidenced and
secured hereby), does hereby jointly and severally: (a) consent to any
forbearance or extension of the time or manner of payment hereof and to the
release of all or any part of any security held by the Lender to secure payment
of this Note and to the subordination of the lien of the mortgage and any other
instrument of security securing this Note as to all or any part of the property
encumbered thereby, all without notice to or consent of that party; (b) agree
that no course of dealing or delay or omission or forbearance on the part of the
Lender in exercising or enforcing any of its rights or remedies hereunder or
under any instrument securing this Note shall impair or be prejudicial to any of
the Lender's rights and remedies hereunder or to the enforcement hereof and that
the Lender may extend, modify or postpone the time and manner of payment and
performance of this Note and any instrument securing this Note, may grant
forbearance and may release, wholly or partially, any security held by the
Lender as security for this Note and release, partially or wholly, any person or
party primarily or secondarily liable with respect to this Note, all without
notice to or consent by any party primarily or secondarily liable hereunder and
without thereby releasing, discharging or diminishing its rights and remedies
against any other party primarily or secondarily liable hereunder; and (c) waive
notice of acceptance of this Note, notice of the occurrence of any default
hereunder or under any instrument securing this Note and presentment, demand,
protest, notice of dishonor and notice of protest and notices of any and all
action at any time taken or omitted by the Lender in connection with this Note
or any instrument securing this Note and waives all requirements necessary to
hold that party to the liability of that party.

All parties liable
for the payment of this Note agree to pay the Lender reasonable attorneys' fees
and costs, whether or not an action be brought, for the services of counsel
employed after maturity or default to collect this Note or any principal or
interest due hereunder, or to protect the security, if any, or enforce the
performance of any other agreement contained in this Note or in any instrument
of security as aforesaid, including costs and attorneys' fees on any appeal, or
in any proceedings under the Bankruptcy Code or in any post judgment
proceedings.

This Note is
executed under seal and constitutes a contract under the laws of the State of
Florida, and shall be enforceable in a Court of competent jurisdiction in that
State.

TECHNOLOGY
RESEARCH                   
TECHNOLOGY RESEARCH

CORPORATION                                        
CORPORATION/ HONDURAS , S.A. DE
C.V.

 

By:    /s/ Scott J.
Loucks                              
By:    /s/ Scott J.
Loucks                   

Name:   Scott J.
Loucks                               
Name:   Scott J. Loucks

Title:   VP Finance,
CFO                              
Title:  Secretary

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