Document:

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                                                                 Exhibit 10 (kk)
                                                        REDI LOAN NUMBER 02-18-A

                              STATE OF SOUTH DAKOTA
                          BOARD OF ECONOMIC DEVELOPMENT

                         REVOLVING ECONOMIC DEVELOPMENT
                            AND INITIATIVE FUND (REDI)

                                 LOAN AGREEMENT

         LOAN AGREEMENT made and entered into this 19th day of December, 2002,
by and between the South Dakota Board of Economic Development, 711 Wells Avenue,
Pierre, South Dakota 57501 (herein "BED"), and M-TRON INDUSTRIES, INC. OF 100
DOUGLAS AVENUE, YANKTON, SOUTH DAKOTA 57078 (herein the "Borrower").

         WHEREAS, the South Dakota Board of Economic Development is a board
created pursuant to SDCL 1-16G-1 for the purpose of promoting economic
development in South Dakota, and the South Dakota Governor's Office of Economic
Development, acting pursuant to ARSD 68:02:01:23, provides administrative
support to BED in the application, processing, monitoring, and servicing of
loans made by BED; and,

         WHEREAS, the Borrower made an application (the "Application") dated
September 20, 2002, to BED for a loan from the Revolving Economic Development
and Initiative Fund (REDI), which Application was approved by BED pursuant to
SDCL Chapters 1-33 and 1-16G, as amended, and ARSD Article 68:02 (the "BED
Loan"); and,

         WHEREAS, BED has by duly adopted resolution designated one of the
members of the Board of Economic Development to execute this Loan Agreement; has
designated the Commissioner, Governor's Office of Economic Development (the
"Commissioner"), and BankWest, Inc., a state chartered financial institution, of
Pierre, South Dakota (BankWest), as its representatives hereunder; has
authorized the Commissioner to act on its and the State's behalf hereunder; has
empowered the Commissioner to delegate his duties in connection herewith to
those persons under his supervision as he deems appropriate, has entered into a
Loan Servicing Agreement with BankWest, whereby BankWest will act as BED's agent
for purposes of closing, funding, receiving payment and servicing the BED Loan
with the Borrower: and has authorized BankWest to act on behalf of BED
consistent with the terms of the Loan Servicing Agreement and the Borrower's BED
Loan Documents;

NOW THEREFORE it is mutually agreed as follows:

         1. In consideration of the Borrower's execution and delivery of a
Promissory Note dated the date hereof, and observance and performance of the
covenants, terms and conditions hereof, and in reliance on the Borrower's
representations made herein, BED, through its duly designated agent, agrees to
loan to Borrower, from the Revolving Economic Development and Initiative Fund
the principal sum of Two Hundred Ninety-Six Thousand and no/100 Dollars
($296,000), according to the terms and conditions set forth in this Loan
Agreement and the Promissory Note of even date herewith, which is incorporated
herein by reference.

                                  Page 1 of 11

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         2. In consideration of BED's agreement to loan said funds to the
Borrower, the Borrower has made, executed and delivered to BED a Promissory Note
dated the date hereof, in the principal sum of Two Hundred Ninety-Six Thousand
and no/100 Dollars ($296,000), due and payable, together with interest thereon
at the rate of three percent (3%) per annum, simple interest, according to the
terms and conditions set forth therein and in this Loan Agreement.

         3. As security for the repayment of the BED Loan above described, the
Borrower agrees as follows:

         a. To mortgage to BED the real property, buildings, and improvements
            owned by the Borrower as described with particularity in the
            Mortgage of even date which is incorporated herein by reference;

         4. Unless otherwise provided herein or in the Loan Servicing Agreement,
or unless a Lender disburses the funds pursuant to a Lender Agreement, the loan
proceeds will be kept in the state treasury, in the Revolving Economic
Development and Initiative Fund, and shall be disbursed to the Borrower based
upon the Borrower's request for disbursements. In order to obtain a
disbursement, the Borrower shall submit to BED a signed request for disbursement
on a form prescribed by BED, together with all attachments required by such
form. Disbursements may be obtained only for those Project costs which have been
legally incurred, and which are due and payable, or have been paid by the
Borrower. The Borrower will designate, by duly adopted resolution, an official
to certify on Borrower's behalf that the request submitted is correct and is a
valid expenditure for the Project. Unless BED specifically agrees otherwise, or
unless the Borrower has already paid the costs, disbursements shall be made
directly to the person to whom the Borrower owes such amount. First disbursement
of the BED Loan must be made not later than six months from the date hereof, and
no disbursement may be made later than twelve months from the date of BED's
original approval of Borrower's Application, unless such time is extended in
writing by BED.

         5. Borrower warrants and represents as follows:

         a. The Borrower is duly organized and existing under the laws of the
            State of South Dakota, or under the laws of another state or country
            and is authorized to transact business in the State of South Dakota;
            has taken all proper action, including the adoption of a resolution,
            to authorize the execution, delivery and performance of its
            obligations under this Loan Agreement, the Promissory Note, and any
            other Loan Documents (hereinafter referred to jointly as the "Loan
            Documents"), and the incurring of the debt represented by the
            Promissory Note; and has the power and authority to enter into and
            consummate all transactions contemplated by the Loan Documents, and
            to carry out its obligations hereunder and thereunder.

         b. There is no action, suit, proceeding, inquiry or investigation at
            law or equity, by or before any judicial or administrative court,
            agency or body, pending or threatened against the Borrower wherein
            an unfavorable decision, ruling, or finding would materially and
            adversely affect the validity or enforceability of any of the Loan
            Documents.

                                  Page 2 of 11

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         c. Neither the execution and delivery of the Loan Documents, the
            consummation of the transactions contemplated thereby, nor the
            fulfillment of, or compliance with the provisions of the Loan
            Documents will conflict with or result in the breach of any
            restriction, agreement or instrument to which the Borrower is a
            party, or by which it is bound, or result in the creation or
            imposition of any lien of any nature upon any of the property of the
            Borrower under the terms of any such instrument or agreement, nor
            will such action result in the violation of any provision of any
            law, ordinance, governmental order to which the Borrower, its
            property or operations are subject.

         d. No event of default has occurred in any agreement or instrument as
            to any outstanding indebtedness of the Borrower for money borrowed
            and no condition, event or act exists which, with the lapse of time
            or the giving of notice, would constitute an event of default under
            any such agreement or instrument. The Borrower is not in violation
            of any term of any restriction, agreement, indenture, ordinance,
            resolution, charter, or other instrument to which it is a party or
            which it or its property may be bound, which violation would
            materially and adversely affect the transactions contemplated hereby
            or the compliance by the Borrower with the terms of the Loan
            Documents.

         e. The Borrower has obtained or made all permits, filings and approvals
            required to the date of this Loan Agreement by any governmental body
            or officer for the making and performance by the Borrower of its
            obligations under the Loan Documents or for the Project, the
            financing thereof or the reimbursement of the Borrower for the costs
            thereof No consent, approval or authorization of, or filing,
            registration or qualification with, any governmental authority
            (other than those, if any, already obtained) is required on the part
            of the Borrower as a condition to entering into the Loan Documents
            and the performance of the Borrower's obligations hereunder and
            thereunder.

         f. The Loan Documents to which the Borrower is a party are legal, valid
            and binding obligations and agreements of the Borrower, enforceable
            against the Borrower according to their terms, except as the
            enforceability thereof may be limited by laws relating to
            bankruptcy, insolvency or other similar laws affecting creditors'
            rights generally and general principles of equity.

         g. The Project consists of the facilities, improvements and activities
            described in Exhibit A, attached hereto, and by this reference
            incorporated herein, as such Exhibit may be amended from time to
            time.

         h. The funds provided pursuant to this Loan Agreement do not exceed 29
            percent of the total Project cost as described in the Borrower's
            Application.

         i. There is no fact that the Borrower has not specifically disclosed in
            writing to BED that materially and adversely affects or will
            materially and adversely affect the properties, operations and
            finances of the Borrower, its status as a legal entity in good
            standing, or its ability to perform its obligations under the Loan
            Documents, or to pledge any revenues or property to the repayment of
            the BED Loan

                                  Page 3 of 11

<PAGE>

         j. The Borrower certifies that there has been no material adverse
            change since the date of the Borrower's Application in the financial
            condition, organization, operation, business prospects, property, or
            the personnel of the Borrower; and that the information contained in
            the Application, and other information the Borrower provided to BED
            does not contain any material misrepresentations or misstatements of
            fact.

         k. The Borrower further warrants and represents that it:

                  (1)      has not received any notice or otherwise learned of
                           any environmental liability which would individually
                           or in the aggregate constitute a Material Adverse
                           Occurrence arising in connection with (i) any
                           non-compliance with or violation of the requirements
                           of any Environmental Law as defined in Section 13 or
                           (ii) the release or threatened release of any toxic
                           or hazardous waste, contaminant, constituent or other
                           substance into the environment;

                  (2)      does not have any knowledge of any threatened or
                           actual liability in connection with the release or
                           threatened release of any toxic or hazardous waste,
                           contaminant, constituent, or other substance in the
                           environment which would individually or in the
                           aggregate constitute a Material Adverse Occurrence;
                           and

                  (3)      has not received any notice or otherwise learned of
                           any federal or state investigation evaluating whether
                           any remedial action is needed to respond to a
                           material release or threatened release on any toxic
                           or hazardous waste, contaminant, constituent or other
                           substance into the environment for which the Borrower
                           is or may be liable. The Borrower is in substantial
                           compliance with all Environmental Laws in the
                           respective jurisdictions where it is presently doing
                           business or conducting operations.

                  Material Adverse Occurrence shall mean any occurrence of
                  whatsoever nature (including, without limitation, any adverse
                  determination in any litigation, arbitration or governmental
                  investigation or proceeding) which the BED shall reasonably
                  determine materially adversely affects: (i) the then present
                  or prospective financial condition or operations of any party
                  to the Loan; (ii) the ability of any such Party to perform its
                  obligations under any of the Loan Documents; or (iii) the
                  value of the Collateral securing the Loan.

         6. To further induce BED to make this BED Loan, Borrower agrees to the
following conditions:

         a. Borrower will execute the Loan Documents and any supplements or
            additions thereto, and such other documents in connection with this
            BED Loan as BED may from time to time request which are reasonably
            necessary to effectuate to the fullest extent possible the terms of
            this Loan Agreement and the Loan Documents.

                                  Page 4 of 11

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         b. Borrower will, on demand, reimburse BED for any and all expenses,
            including reasonable attorney fees, incurred, or which may be
            hereafter incurred, by BED or its agents from time to time in
            connection with or by reason of Borrower's Application for, and the
            making and administration, of the BED Loan.

         c. Borrower will at all times keep proper books of account in a manner
            satisfactory to BED. Borrower authorizes BED to make or cause to be
            made, during regular business hours, at Borrower's expense and in
            such manner and at such times as BED may require, (i) inspections
            and audits of any books, records and papers in the custody or
            control of Borrower or others, relating to Borrower's financial or
            business conditions, including the making of copies thereof and
            extracts therefrom, and (ii) inspections and appraisals of any of
            Borrower's assets. Borrower will furnish to BED quarterly financial
            statements within 60 days of quarter-end and an annual report within
            90 days of the fiscal year end. The annual report must contain, at a
            minimum, the Borrower's unaudited financial statements (including a
            balance sheet, income statements and cash flow statement), and upon
            request of BED will include Borrower's federal tax returns. Borrower
            hereby authorizes all federal, state and municipal authorities to
            furnish reports, examination, records, and other information
            relating to the conditions and affairs of Borrower and any desired
            information from such reports, returns, files, and records of such
            authorities upon request therefor by BED.

         d. Borrower agrees to comply with those federal, state and local laws,
            regulations, ordinances and permits applicable to the Project, as
            well as the provisions of SDCL Chapter 1-16G, SDCL Chapter 1-33, and
            ARSD Chapter 68:02, and shall furnish to BED such reports and
            information and provide such access required by those statutes and
            rules.

         e. Borrower agrees to pay in a timely manner the principal and interest
            on the Promissory Note, and on any other indebtedness now or
            hereafter at any time due to BED or any other Lender.

         f. The Borrower will promptly pay all taxes, charges, liens,
            assessments and encumbrances which now affect, or which may in the
            future affect, the Project or the security for the payment of the
            Promissory Note as herein provided, or BED's interest therein for
            which it is legally liable.

         g. Borrower agrees to indemnify and hold BED, its officers, agents and
            employees, harmless from and against any and all actions, suits,
            damages, liability or other proceedings (including costs and
            attorney's fees) arising from or connected with the Borrower's
            Project funded herein. This section does not require the Borrower to
            be responsible for or defend against claims or damages arising
            solely from errors or omissions of BED, its officers, agents or
            employees.

                                  Page 5 of 11

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         h. Borrower agrees that it will notify BED in writing within 30 days of
            the occurrence of any of the following: (i) if Borrower is an
            individual, a change in the place of Borrower's principal residence;
            (ii) if Borrower is an organization, a change in Borrower's place of
            business, the opening of any new place of business or the closing of
            any existing place of business; (iii) if Borrower is an
            organization, a change in the location of its chief executive
            office; (iv) any other change in the Borrower's "location" as that
            term is defined and used in Article 9 of the Uniform Commercial Code
            as adopted in South Dakota and as amended from time to time. Failure
            to do so shall constitute a material default upon the terms of this
            Loan Agreement.

         7. On or prior to the disbursement of funds pursuant to this Loan
Agreement, the Borrower shall submit to BankWest all documents required by the
Commitment Letter, the Loan Documents and the applicable statutes and
regulations. In addition, the Borrower shall submit the following items:

         a. the executed Promissory Note, Mortgage and Parity Agreement;

         b. an executed counterpart of this Loan Agreement;

         c. an executed Employment Agreement with BED agreeing to create and
            retain not less than 32 full time employee positions, as set forth
            in the Borrower's Application dated September 20, 2002.

         d. a certified resolution of the Borrower's governing body approving
            the BED Loan, this Loan Agreement, the Promissory Note, and the Loan
            Documents;

         e. any certificate of insurance required by the Loan Agreement or the
            Loan Documents, including, if applicable, a title insurance policy;

         f  such other certificates, documents and other information as BED may
            require.

         Once the documents listed above have been executed and delivered, the
         BED Loan will be deemed closed.

         8. In the event Borrower fails to make any payment or any part thereof
as provided in the Promissory Note described herein, within fifteen (15) days of
the due date thereof, or in the event that the Borrower fails or refuses to
perform any covenants or agreements hereunder on the Borrower's part made and
entered into, or under any agreement between the Borrower and the BED made in
connection with the BED Loan, or in the event of failure of the Borrower to
promptly pay, when due, any taxes, charges, liens, assessments, or encumbrances,
or in the event of the insolvency of the Borrower, BED may at its option declare
this Agreement and the Promissory note to be in default and the total
indebtedness owed by the Borrower to BED, including principal and interest,
shall at the option of BED immediately become due and payable, upon twenty (20)
days' written notice to the Borrower. Anything in the foregoing or in any of the
other Loan Documents to the contrary

                                  Page 6 of 11

<PAGE>

notwithstanding, BED may in the event of a default not capable of cure
immediately declare a default and immediately take action to realize upon the
Collateral by whatever means allowed by law.

         a. In the event of any default by Borrower upon the terms of this Loan
            Agreement or the Promissory Note, then the entire outstanding
            principal balance of the Loan shall thereafter bear interest until
            paid or until the default is cured to BED's satisfaction at a fixed
            rate three percentage points higher than the prime rate of interest
            published weekly in the Wall Street Journal, as published at the
            time of the default.

         b. In the event that Borrower defaults in providing the financial
            information required by Section 6(c), the reports required under
            Section 6(d), or proof of the insurance required by Section 12 of
            this Loan Agreement, then the Borrower shall pay to BED the sum of
            $200 for each such default. This sum is intended by the parties and
            shall be considered and treated as liquidated damages due to BED,
            and not as a penalty. The parties specifically agree that due to the
            nature of the BED Loan made to the Borrower it is impracticable or
            extremely difficult to fix the actual damages resulting from the
            Borrower's breach of those provisions of this Loan Agreement because
            failure to provide the information in a timely manner prevents BED
            from having complete and accurate data concerning the status of its
            economic development program for the purpose of preparing its annual
            report, assessing the success of its economic development strategies
            and developing future strategies; from assessing the financial
            strength of the businesses BED assists, and the success of its
            assistance efforts; and it makes it difficult for BED to protect the
            continued viability of its revolving loan program.

         9. If an event of default occurs, BED, at its sole option, has the
right, but not the duty, to incur and pay any reasonable expenses, for the
account of the Borrower, for the payment of any taxes, charges, liens,
assessments and encumbrances with relation to the Project, and add any amounts
so paid to the principal sum due hereunder. Borrower agrees that if an event of
default occurs, in addition to any other amounts that may be due from the
Borrower, it will pay BED an amount equal to the costs and expenses, including
reasonable expert and attorneys fees, incurred by BED in enforcing its rights
under this Loan Agreement or the other Loan Documents.

         10. The rights and remedies herein conferred upon BED shall be
cumulative and not alternative and shall be in addition and not in substitution
of or in derogation of rights and remedies conferred by the Loan Documents or
any other agreements between the parties hereto or by any applicable law. The
failure of BED to enforce strict performance of any covenant, promise, or
condition herein contained, including timely payments due hereunder, shall not
operate as a waiver of the right of BED thereafter to require that the terms
hereof be strictly performed according to the tenor thereof.

         11. If BED participates in this loan with a bank, credit union, savings
and loan, a federal or state agency, or other lender ("the Lender"), the
Borrower agrees to cooperate and abide by all terms and conditions of any and
all loan documents involving any loan from the Lender to the Borrower for the
Project, including the Lender Agreement. A default in any provision of any such
loan documents with the Lender shall constitute a default under this Loan
Agreement and the Promissory Note.

                                  Page 7 of 11

<PAGE>

Borrower further agrees to cooperate with BankWest as closing agent and loan
servicing agent, to facilitate the performance of the duties of BankWest
pursuant to the Loan Servicing Agreement.

         12. The Borrower shall at all times during the term of this Loan
Agreement, and while the Promissory Note is outstanding, keep and maintain, or
provide evidence acceptable to BED that it has obtained, property and casualty
insurance, workers compensation, and liability insurance with insurers licensed
to do business in the State, against such risks and in such amounts as are
customary in the State for entities of the same or similar size and type as the
Borrower, and similarly situated with facilities of the Project's type, and
provide proof of such coverage to BED. Each policy (except workers' compensation
insurance) shall be lender loss payable, and name BED as an additional insured
or loss payee, as its interests may appear. Any policy provided pursuant to this
section must provide that it cannot be canceled without 30 days prior written
notice of cancellation to BED. In the event of cancellation the Borrower will
promptly obtain replacement insurance with the same or substantially similar
coverage and provide proof of such coverage to BED. In the event of renewal,
replacement, or changes in coverage, the Borrower will promptly provide written
notice of such changes to BED.

         13. The Borrower covenants and agrees to comply with all present and
future environmental laws, ordinances, permits, rules and regulations. Borrower
shall not permit the generation, creation, treatment, incorporation, discharge,
disposal, escape, release or threat of release of any contaminant above, upon,
under, within, or from the Project site which is not in compliance with any
applicable laws, ordinances, permits, rules and regulations. Borrower represents
that there are no underground storage tanks containing any contaminant located
on the Project site, or property assigned as Collateral for this BED Loan, and
that no new tanks will be located on such property unless the Borrower complies
with any applicable laws, ordinances, rules and regulations, and obtains all
necessary permits.

         a. For purposes of this Loan Agreement, "contaminant" is a "Petroleum
            Product" as described in SDCL 37-2-5; "Asbestos" as described in
            SDCL 34-44-1(2); a "Regulated Substance" as described in SDCL 34
            A-12-1(8); substances regulated under and defined in the provisions
            of 15 U.S.C. 2601-2671, 33 U.S.C. 1251-1387, 42 U.S.C. 6901-6999(I),
            or 42 U.S.C. 7401-7642; or any corresponding federal or state
            regulations promulgated under the above federal or state statutes,
            as well as any amendments, deletions, or corrections to any such
            laws, ordinances, rules and regulations, including any laws,
            ordinances, rules and regulations which may be enacted or adopted
            subsequent to the date of, and which become effective during the
            term of, and while the Premises remains subject to the terms and
            conditions of this Loan Agreement.

         b. Borrower agrees to indemnify and hold BED, its officers, agents,
            employees, assigns and successors in interest harmless from any and
            all claims, demands, judgments, penalties, costs, damages, expenses
            or liability of any kind or character whatsoever, including costs
            and reasonable attorneys' fees, arising or resulting from or
            connected with a breach of the foregoing covenant, it being the
            intent of BED and the Borrower that BED shall have no liability for
            damage to the environment or natural resources, for abatement,
            removal, or cleanup of, or otherwise with respect to, any
            contaminants either by virtue of any interest

                                  Page 8 of 11

<PAGE>

            of BED in the property, or created as a result of BED's exercise of
            any of its rights or remedies under this Loan Agreement or any of
            the Loan Documents.

         c. Borrower shall, for the purposes of this Loan Agreement, be
            designated the "Owner" or "Operator" of the property.

         14. Any required or permitted notice or other communication under this
Agreement shall be in writing and addressed as follows:

               If to BED:           State of South Dakota
                                    Board of Economic Development
                                    c/o Governors Office of Economic Development
                                    711 East Wells Avenue
                                    Pierre, SD 57501-3369

                 Copy to:           BankWest, Inc.
                                    P.O. Box 998
                                    Pierre, S.D. 57501

          If to Borrower:           M-tron Industries, Inc.
                                    100 Douglas Avenue
                                    Yankton, SD 57078

Notices required or permitted under this Loan Agreement shall be given by and to
the Commissioner, Governor's Office of Economic Development and Craig Hilton,
Senior Vice President of Bankwest on behalf of BED, and the Borrower
or__________________on behalf of the Borrower, or such authorized designees as
either party may from time to time designate in writing. Any such notice or
other communication, if mailed, shall be sent by registered or certified mail,
return receipt requested. Notices or communications to or between the parties
shall be deemed to have been delivered when mailed by registered or certified
mail or, if personally delivered, when received by such party.

         15. Time is of the essence in the performance of the covenants, terms
and conditions contained in this BED Loan Agreement. This Loan Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective transferees, successors and assigns except that the Borrower may not
assign or transfer it rights under the Loan Documents without prior written
consent of BED.

         16. All other prior discussions, communications and representations
concerning the subject matter of the Loan Documents are superseded by the terms
of the Loan Documents, and except as specifically provided herein, the Loan
Documents constitute the entire agreement with respect to the subject matter
hereof.

                                  Page 9 of 11

<PAGE>

         17. This Agreement shall be governed by and construed in accordance
with the laws of the State of South Dakota. Any lawsuit pertaining to or
affecting this Loan Agreement shall be venued in Circuit Court, Sixth Judicial
Circuit, Hughes County, South Dakota.

         18. All representations contained in the Borrower's Application, and
all representations, terms, conditions and covenants contained in the Commitment
Letter executed in conjunction with this Loan Agreement are hereby incorporated
by reference herein. To the extent there is a conflict between the terms of the
Application or Commitment Letter and this Loan Agreement, the terms of this Loan
Agreement shall prevail.

         19. This Loan Agreement and the Loan Documents may not be amended
except in writing, which writing shall be expressly identified as a part hereof
or thereof, and which writing will be signed by an authorized representative of
each of the parties. No provision stated herein shall be waived without the
prior written consent of BED.

         20. In the event that any provision of this Loan Agreement shall be
held unenforceable or invalid by any court of competent jurisdiction, such
holding shall not invalidate or render unenforceable any other provision hereof.

         IN WITNESS WHEREOF the parties hereto have set their hands and seals
effective the day and year above first written.

                                                 SOUTH DAKOTA BOARD OF
                                                 ECONOMIC DEVELOPMENT

                                                 BY:  [ILLEGIBLE]
                                                      --------------------------
(SEAL)
                                                 ITS: TREASURER

                                                 M-TRON INDUSTRIES, INC.

(SEAL)                                           BY:  /s/ Robert R. Zylstra
                                                      ---------------------
                                                 ITS: President & CEO

ATTEST:

BY:  /s/ David L. Rein
     -----------------------
ITS: Secretary

NOTE: Corporate Borrowers must execute Loan Agreement, in corporate name, by
duly authorized officer, and seal must be affixed and duly attested.

                                  Page 10 of 11

<PAGE>

                                   EXHIBIT A
                                       TO
                                 LOAN AGREEMENT

                              PROJECT DESCRIPTION

REDI loan proceeds will be used expand the Yankton facility by funding the
purchase of inventory and equipment from Champion Technology, A competitor being
liquidated.

<TABLE>
<CAPTION>
SOURCES                                                 USES
-------                                                 ----
<S>                              <C>                    <C>                            <C>
REDI                             $   350,000            Equipment                      $    350,000
ABC                              $   100,000            Inventory                      $    500,000
YAPG                             $   250,000            Acquisition Costs              $    170,000
FNB-Omaha                        $   120,000
Equity-Lynch Corp,               $   200,000
                                 -----------                                           ------------
TOTAL                            $ 1,020,000            TOTAL                          $  1,020,000
                                 -----------                                           ------------
</TABLE>

ACKNOWLEDGMENT OF EXHIBIT A
TO LOAN AGREEMENT

M-TRON INDUSTRIES, INC.

BY:  /s/ David L. Rein
     -----------------------
ITS: VP & CFO

                                  Page 11 of 11<PAGE>
                                                                 Exhibit 10 (ll)
                              STATE OF SOUTH DAKOTA
                          BOARD OF ECONOMIC DEVELOPMENT

                                                        REDI LOAN NUMBER 02-18-A

                                 PROMISSORY NOTE

                                                        YANKTON, SOUTH DAKOTA

$296,000                                                DECEMBER 19, 2002

         For value received, the undersigned M-TRON INDUSTRIES, INC. OF 100
DOUGLAS AVENUE, YANKTON, SOUTH DAKOTA 57078 promises to pay, in lawful money of
the United States of America, to the order of SOUTH DAKOTA BOARD OF ECONOMIC
DEVELOPMENT at the offices of its Loan Servicing Agent, BankWest Inc., at P.O.
Box 998, City of PIERRE, State of SOUTH DAKOTA or at holder's option, at such
other place as may be designated from time to time by the holder TWO HUNDRED
NINETY-SIX THOUSAND AND NO/100 DOLLARS, ($296,000) with interest on unpaid
principal computed from the date of each advance to the undersigned at the rate
of three percent per annum, payment to be made in installments as follows:

         By paying 59 equal monthly installments, in the amount of $1,642.00,
         (based on a level 240 month amortization), beginning thirty (30) days
         from the date of this Promissory Note, with the final balloon payment
         of principal and interest due at the end of 60 months/years from the
         date of this Promissory Note.

         This Promissory Note is issued pursuant to that certain Revolving
Economic Development and Initiative Fund (REDI) Loan Agreement dated the date
hereof by and between the Borrower and BED (the "Loan Agreement"), the terms and
provisions of which are hereby incorporated by reference, pursuant to SDCL
Chapters 1-16G and 1-33, as amended, and Rules and Regulations Article 68:02,
Administrative Rules South Dakota (ARSD).

         This Promissory Note is secured by:

                   [X] Mortgage of even date.

         If any sum payable hereunder is not paid when due or in the event of a
default upon any term, covenant or condition of any of the Loan Documents, then
the entire outstanding principal balance shall thereafter bear interest until
paid or until the default is cured to BED's satisfaction at a fixed rate three
percentage points higher that the prime rate of interest published weekly in the
Wall Street Journal, as published a the time of the default.

                                  Page 1 of 3

<PAGE>

         The Borrower shall have the option of prepaying any installment of
principal or interest owing on this Promissory Note prior to the maturity date
thereof without penalty. If prepayments are made, such payment will include
accrued interest to the date of the prepayment on the amount of principal
prepaid, and principal payments shall be reduced in inverse order of maturity.
Such prepayments shall not in any way alter or suspend any obligations of the
Borrower under the terms of this Promissory Note or the Loan Agreement.

         In the event of default in the payment of this Promissory Note, the
Borrower agrees to pay all costs of collection, including reasonable attorney
fees.

         The Borrower hereby waives presentment for payment, demand, notice of
nonpayment, protest, notice of protest, and notice of dishonor.

         This Promissory Note and all instruments or documents securing the same
shall be governed by and construed in accordance with the laws of the State of
South Dakota.

         Signed and sealed this 19th day of December, 2002.

                                                  M-TRON INDUSTRIES, INC.

       (SEAL)                                     BY:  /s/ Robert R. Zylstra
                                                       ---------------------
                                                  ITS: President & CEO

ATTEST:

BY: /s/ David L. Rein
    -----------------
ITS: Secretary

NOTE: Corporate Borrowers must execute Promissory Note, in corporate name, by
duly authorized officer, and seal must be affixed and duly attested.

                                  Page 2 of 3

<PAGE>

                         DECLARATION OF BUSINESS PURPOSE

         The undersigned has applied to BED for credit in the amount not to
exceed $296,000. The undersigned warrants and represents that the credit will be
used primarily (50% or more) for the business or commercial purpose described in
the Loan Agreement, and will not be used primarily for personal, family or
household purposes. This declaration is to confirm that no disclosures are
required under the Federal Truth in Lending law and Regulations.

         Dated at Yankton, South Dakota, this 19th day of December, 2002.

                                                  M-TRON INDUSTRIES, INC.

         (SEAL)                                   BY:  /s/ Robert R. Zylstra
                                                       ---------------------
                                                  ITS: President & CEO

ATTEST:

BY: /s/ David L. Rein
    -----------------
ITS: Secretary

NOTE: Corporate Borrowers must execute Declaration, in corporate name, by
duly authorized officer, and seal must be affixed and duly attested.

                                  Page 3 of 3

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