Document:

<PAGE>

                                 EXHIBIT 10.16

                            EMPLOYMENT AGREEMENT OF
                               DAVID L. SHEPHERD
<PAGE>

                              EMPLOYMENT AGREEMENT

          THIS AGREEMENT made as of the 23rd day of April, 2001, between
Westwood Corporation (hereinafter called the "Company"), and David L. Shepherd
(hereinafter called "Shepherd").

          1.  Employment. The Company employs Shepherd who accepts employment
              ----------
upon the terms and conditions of this Agreement.

          2.  Term.  The term of employment provisions of this Agreement shall
              ----
begin on April 23, 2001, and shall terminate on April 22, 2003.

          3.  Compensation.  For all services rendered by Shepherd, the Company
              ------------
shall pay him a salary of $127,500 a year, payable in equal monthly installments
at the end of each month.  Salary payment shall be subject to withholding and
other applicable taxes.  The Company shall have the opportunity to provide
raises or increases to Shepherd, such decision to be subject to approval by the
Board of Directors.

          4.  Bonus Compensation.  It will be the Company's policy to provide
              ------------------
Shepherd, as an additional incentive, either on an annual or quarterly basis,
additional bonus compensation in the form of additional cash payments at the
discretion of the Board of Directors.  Such bonus compensation, if any, shall be
determined by the Board of Directors in consideration of such factors as the
Company's profitability, change in asset size of the Company, number of
employees, sales levels and growth in sales, and other factors determined by the
Board of Directors as relevant in its decision.

          5.  Shepherd Stock Option.  The Company hereby grants Shepherd the
              ---------------------
option to purchase up to 50,000 common shares of the Company pursuant to the
1992 Incentive and Nonqualified Stock Option Plan, as amended (the "Plan"), with
such terms and provisions as set forth in the Plan and in the Option Agreement
attached to this Employment Agreement as Exhibit "A".

          6.  Duties.  Shepherd is to be employed as the Secretary/Treasurer and
              ------
Chief Financial Officer of the Company and will be charged with all activities
related thereto and as assigned by the President.  Shepherd shall devote all
time, attention and energies to the Company's business.

          7.  Expenses.  Shepherd may incur reasonable expenses in connection
              --------
with the Company's business, including expenses for entertainment, travel
expenses and similar items.  The Company will reimburse Shepherd for all such
expenses upon the periodic presentation of an itemized account of such
expenditures.

          8.  Vacations.  Shepherd shall be entitled to a vacation of two weeks
              ---------
during the first year of employment, three weeks during the second year of
employment, and four weeks of
<PAGE>

vacation for each year of employment thereafter, during which time his
compensation shall be paid in full.

          9.   Death During Employment.  If Shepherd should die during the term
               -----------------------
of employment, the Company shall pay to the estate of Shepherd the compensation
which would otherwise be payable to him up to the end of the month in which his
death occurs.  In addition, the Company shall pay an additional two (2) months
salary, within 60 days after the death of Shepherd, to his widow or, if he is
not survived by his widow, to Shepherd's surviving children in equal shares or,
if there are no such surviving children, to his estate.  In the event of
Shepherd's death, all other rights and benefits Shepherd (or his estate) may
have under the employee and/or group or executive benefit plans and programs of
the Company generally, as permitted by law, shall be determined in accordance
with the terms and conditions of such plans and programs.

          10.  Termination of Employment.
               -------------------------

          (a)  Due Cause.  Nothing herein shall prevent the Company from
               ---------
terminating Shepherd for "Due Cause" (as hereinafter defined), in which event
Shepherd shall be entitled to receive his salary on a pro rata basis to the date
of termination. In the event of such termination for Due Cause, all other rights
and benefits Shepherd may have under the employee and/or group or executive
benefit plans and programs of the Company, generally, shall be determined in
accordance with the terms and conditions of such plans and programs. The term
"Due Cause" shall mean (i) Shepherd has committed a willful criminal act, such
as embezzlement, against the Company intending to enrich himself at the expense
of the Company, (ii) a finding by the Board of Directors that Shepherd has
engaged in misconduct materially injurious to the Company or any of its
Subsidiaries or their reputation or that Shepherd has committed gross negligence
or willful misconduct with respect to the Company or any of its Subsidiaries, or
(iii) Shepherd fails to carry out his duties in gross dereliction of duty and,
after receiving written notice to such effect from the President or Board of
Directors, Shepherd fails to cure the existing problem within thirty (30) days.

          (b)  Disability.  In the event Shepherd suffers a Disability, this
               ----------
Agreement shall terminate three (3) months after the date on which the
Disability occurs and Shepherd shall be entitled to his salary through the end
of the month in which is employment is terminated due to the Disability.

          (c)  Voluntary Termination.  Shepherd may voluntarily terminate his
               ---------------------
employment under this Agreement at any time by providing at least thirty  (30)
days prior written notice to the Company.  In such event, Shepherd shall be
entitled to receive his salary until the date his employment terminates and all
other rights and benefits Shepherd may have under the employee and/or group or
executive benefit plans and programs of the Company, generally, shall be
determined in accordance with the terms and conditions of such plans and
programs.

          (d)  Termination for other than Due Cause.  This Contract does not
               ------------------------------------
prevent the Board of Directors from terminating the employment of Shepherd for
any other reason at its

                                       2
<PAGE>

discretion. In such event that Shepherd's employment is terminated for any
reason not set forth in subsections (a) through (c) of this paragraph, Shepherd
shall be paid the remaining salary payments, including existing benefits,
through April 22, 2003, or six months salary, including existing benefits, if
termination occurs later than October 22, 2002.

          11.  Assignment.  Shepherd acknowledges that the services to be
               ----------
performed by him are unique and personal. Accordingly, Shepherd may not assign
any of his rights or delegate any of his duties or obligations under this
Agreement. The rights and obligations of the Company under this Agreement shall
inure to the benefit of and shall be binding upon the successors and assigns of
the Company.

          IN WITNESS WHEREOF, the parties have signed this Agreement.

                                 WESTWOOD CORPORATION

                                   /s/ Ernest H. McKee
                                 ---------------------
                                 Ernest H. McKee
                                 President

                                 Shepherd:

                                   /s/ David L. Shepherd
                                 -----------------------
                                 David L. Shepherd

                                       3<PAGE>

                                 EXHIBIT 10.17

                  STILLWATER NATIONAL BANK AND TRUST COMPANY
                            OF STILLWATER, OKLAHOMA

                                LOAN AGREEMENT
                            Dated October 25, 2000
<PAGE>

                                LOAN AGREEMENT
                                --------------

     THIS AGREEMENT, made and entered into the 25th day of October, 2000, by and
between STILLWATER NATIONAL BANK AND TRUST COMPANY OF STILLWATER, OKLAHOMA, a
National Banking Corporation (hereinafter referred to as "Bank"), WESTWOOD
CORPORATION, a Nevada Corporation (hereinafter referred to as "Westwood"), TANO
CORP., a Louisiana Corporation (hereinafter referred to as "TANO"), NMP CORP.,
an Oklahoma Corporation (hereinafter referred to as "NMP"), and MC II ELECTRIC
COMPANY, a Texas Corporation (hereinafter referred to as "MC II") (collectively
Westwood, TANO, NMP and MC II are hereinafter referred to as "Debtor").

     In consideration of the mutual promises herein contained, the parties
hereby agree as follows:

                             I. THE REVOLVING PLAN

     1.1  Subject to the terms and conditions of this Agreement, Debtor shall
have the right from time to time, prior to the Maturity Date, to borrow and,
upon repayment, reborrow from the Bank amounts not at any one time in the
aggregate principal balance exceeding the lesser of (i) the Borrowing Base
determined as of the date of borrowing; or (ii) Two Million Eight Hundred
Thousand and No/100 Dollars ($2,800,000.00) (hereinafter referred to as
"Revolving Loan").  For these purposes:

          (a) "Maturity Date" means March 25, 2001.

          (b) "Borrowing Base" means, as of any given date, the sum of the
     following factors: (1) seventy-five percent (75%), or at the Bank's sole
     discretion any lesser percentage designated upon forty-five (45) days
     notice, of Eligible Trade Accounts Receivable of TANG, MC II and NMP; plus
     (2) fifty percent (50%) of the value of the inventory of NMP, excluding the
     inventory being held by NMP for the benefit of MC II, not to exceed One
     Million Five Hundred Thousand and No/100 Dollars ($1,500,000.00).
     Provided, however, as of December 31, 2000, this figure will be adjusted to
     fifty percent (50%) of the value of the inventory of NMP, excluding the
     inventory being held by NMP for the benefit of MC II, not to exceed One
     Million Two Hundred Fifty Thousand and No/100 Dollars ($1,250,000.00).

          (c) "Trade Accounts Receivable" means, as of any given date, all
     accounts receivable of TANO, MC II and NMP for goods sold and delivered and
     services rendered by TANG, MC II and NMP in the ordinary course of the
     business presently conducted by each of them and representing amounts then
     invoiced and due and owing, and a Trade Account Receivable shall be an
     "Eligible Trade Account Receivable", and shall be included in the Borrowing
     Base, only if and so long as it meets each and all of the following
     requirements:

               (1) It is a valid, genuine and legally enforceable obligation,
          subject to no defense, set off or counter-claim, of the account debtor
          or other obligor named herein or in TANG, MC II and/or NMP's records
          pertaining thereto, and that neither TANO, MC II nor NMP has received
          from the account debtor or other obligor any

                                      -1-
<PAGE>

          notification repudiating such obligation or asserting that such
          obligation is subject to any defense, set off or counterclaim;

               (2) It is owned by either TANG, MC II or NMP, free and clear of
          all interests, liens, attachments, encumbrances and security interests
          except the security interest granted to the Bank pursuant to this
          Agreement;

               (3) The Account debtor or other obligor is located in the United
          States or Canada;

               (4) Not more than ninety (90) days have expired since the date of
          invoice; or, if the Bank in its sole discretion accepts as eligible a
          Trade Account Receivable which is due on a date stated in the invoice,
          not more than thirty (30) days have expired since the date stated;

               (5) Neither TANO, MC II nor NMP has received notice from the Bank
          that the credit of the account debtor is not satisfactory to the Bank
          for any reason;

               (6) The account debtor is not an entity in which any of the
          Debtors have a controlling interest;

               (7) Eligible Trade Accounts Receivable shall not include any
          account receivable of the same account debtor to any of the Debtors in
          excess of fifteen percent (15%) of the then Eligible Trade Accounts
          Receivable calculated after excluding this debtor's Eligible Trade
          Accounts Receivable, provided, however Eligible Trade Accounts
          Receivable may include accounts receivable of Ingalls Shipbuilding up
          to a maximum of fifty percent (50%) of the then Eligible Trade
          Accounts Receivable after excluding Ingalls Shipbuilding Eligible
          Trade Accounts Receivable; and

               (8) The entire receivable of one account debtor becomes
          ineligible if more than ten percent (10%) of the total due is over
          ninety (90) days past due, unless the ten percent (10%) over ninety
          (90) days is attributable to an isolated dispute over a specific
          invoice.

          (d) The value of Inventory used in determining the Borrowing Base
     shall equal the value of raw material plus the value of finished product
     and shall not include the value of any work in progress.

     In addition to the eligibility requirements set forth in clause (c) of this
Section 1.1, the Bank shall have the right (acting at its sole discretion with
or without the consent of the Debtor) from time to time by written notice to
Debtor to establish additional or further eligibility requirements and to change
in any manner the eligibility requirements set forth in said clauses or so
established, and if at any time any Receivables fail to meet all the eligibility
requirements set forth in clause (c) of this Section 1.1 or established or
changed from time to time by the Bank, they shall immediately be

                                      -2-
<PAGE>

excluded from the Borrowing Base. Pursuant to this Agreement, the Bank is
granted collateral security in addition to Eligible Trade Accounts Receivable
and Inventory. Notwithstanding any apportionment or segregation of collateral
made by the Bank for purposes of determining the Borrowing Base, all collateral
granted to the Bank pursuant to this Agreement and all other collateral rights,
interests and properties now or at any time hereafter available to the Bank,
shall secure and may be applied to pay any or all indebtedness of the Debtor
secured thereby, in any manner or order of application and without regard to any
such apportionment or segregation.

     1.2  All loans made by the Bank under this Agreement for the Revolving Loan
shall be evidenced by and payable with interest on the terms set forth in a
Renewal and Amended Revolving Promissory Note of Debtor ("Renewal Note") payable
to the order of the Bank, with interest, in the form and with the provisions set
forth in Exhibit "A" attached hereto.  The Bank is hereby authorized, but shall
not be required, to make notations of advances by it to the Debtor and payments
to it by the Debtor on the reverse side of the Renewal Note.  Such notations, or
the entries on any liability ledger records maintained by or for the Bank as to
indebtedness of Debtor, shall be presumed correct until the contrary is
established by Debtor.  Upon demand by the Bank at any time or from time to
time, the Debtor will confirm and admit by signed writing the exact amount of
indebtedness for principal and interest then outstanding under this Agreement.
Any billing statement or accounting rendered by or for the Bank shall be
conclusive and fully binding on Debtor unless specific written notice of
exception is given to the Bank by Debtor within thirty (30) days thereafter.

     1.3  Advances under the Renewal Note will be limited to the Borrowing Base.
A request for advance shall be submitted upon a signed Borrowing Base
Certificate and Compliance Statement in the form as is shown on Exhibit "B"
attached hereto.  Each request for advance will be supported by a current
accounts receivable aging and such other documentation that may reasonably be
required by the Bank to determine the Borrowing Base.

     1.4  The Debtor may prepay the Revolving Note at any time, without premium
or penalty.  If at any time the aggregate outstanding principal balance of all
loans under this Agreement exceeds the then amount of the Borrowing Base, the
Debtor shall immediately, without notice or demand, prepay the Note in an amount
equal to the excess.

     1.5  The Bank may make loans in any amount and in any manner requested
orally or in writing by any officer or agent of the Debtor or by any person
reasonably believed by the Bank to be an officer or agent of the Debtor.  Loan
proceeds may be disbursed by deposit in any deposit account of the Debtor, by an
instrument payable to Borrower.

     1.6  The Debtor will use the proceeds of all loans under this Agreement
solely for lawful and authorized corporate purposes in furtherance of the
business presently conducted by the Debtor.

                                      -3-
<PAGE>

                                 II. INTEREST

     2.1  The interest rate on the Renewal Note shall be the "Contract Rate"
(defined below), and is subject to change from time to time based on changes in
the "Index" (defined below).  The "Contract Rate" shall be a rate per annum
equal to the sum of the "Base Rate" (defined below) and the "Margin" (defined
below).  The Contract Rate shall fluctuate during the term of this Note based
upon the sum of the Base Rate and the Margin.

     2.2  The Base Rate may be adjusted up or down DAILY, and shall equal the
lowest base rate on corporate loans posted by at least seventy-five percent
(75%) of the nation's 30 largest banks as published in the money rates section
of the Southwest Edition of the Wall Street Journal.  Bank will inform Debtor
                                -------------------
what the current Base Rate is at any time during the term of the Renewal Note
upon request of Debtor.  The Base Rate will not change more often than once each
DAY.

     2.3  The Margin shall be one (1) percentage point.

                           III. CONDITIONS PRECEDENT

     3.1  The Bank's obligation to make any loan to the Debtor under the Renewal
Note shall be subject to the terms and conditions of this Agreement and the
following conditions precedent:

          (a)  Each representation and warranty set forth in Section 4.1 shall
     be true and correct as of the date of borrowing. except for changes
     subsequent to the date of this Agreement caused by transactions permitted
     under the terms of this Agreement; and

          (b)  There shall not exist any Event of Default under Section 7.1 of
     this Agreement or any event which, with the giving of notice or the lapse
     of time (or both) would become an Event of Default thereunder; and

          (c)  The Debtor shall have delivered to the Bank:

               (1) The Renewal Note duly executed by Debtor;

               (2) A Security Agreement ("Security Agreement"), in form and
          substance satisfactory to the Bank, granting the Bank security
          interests in all present and future equipment, inventory, and accounts
          receivable of the Debtor;

               (3) All collateral schedules, financing statements, security
          interest, subordination agreements, releases and termination
          statements which the Bank may request to assure the creation,
          perfection and priority of the security interests created by the
          Security Agreement;

               (4) Lock Box Agreement in form and substance satisfactory to the
          Bank, defining how payments of each of the Debtor's accounts
          receivable are to be paid and accounted for;

                                      -4-
<PAGE>

               (5) A Limited Guaranty Agreement ("Guaranty"), in form and
          substance acceptable to the Bank, executed by Ernest H.  McKee
          ("Guarantor"), guaranteeing the payment of the Renewal Note up to a
          maximum amount of Eight Hundred Thousand and No/100 Dollars
          ($800,000.00);

               (6) Pledge Agreement ("Pledge"), in form and substance acceptable
          to the Bank, executed by Ernest H. McKee, pledging Seven Hundred Fifty
          Thousand (750,000) shares of Westwood stock as security for the
          payment of the Renewal Note; and

               (7) Assignment ("Assignment"), in form and substance acceptable
          to the Bank, executed by Ernest H.  McKee, assigning to the Bank his
          rights in and to _____________________________ Life Insurance Policy
          No. _________________ as security for payment of the Renewal Note.

                      IV. REPRESENTATIONS AND WARRANTIES

     4.1  Debtor represents and wan-ants to the Bank that:

          (a) Each Debtor is a corporation, duly organized, existing and in good
     standing under the laws of the State of its incorporation.  It has the
     corporate power to own its property and to carry on its business as now
     conducted and is duly qualified to do business in all states in which such
     qualification is required;

          (b) Each Debtor is duly authorized and empowered to execute, deliver
     and perform this Agreement, the Renewal Note, and the Security Agreement.
     and to borrow money from the Bank;

          (c) The execution and delivery of this Agreement, the Renewal Note,
     and the Security Agreement, and the performance by the Debtor of its
     obligation thereunder, do not, and will not, conflict with any provision of
     law or the Articles of Incorporation or By-Laws of any Debtor or of any
     agreement binding upon it;

          (d) The execution and delivery of this Agreement, the Renewal Note,
     and Security Agreement have been duly authorized by all necessary corporate
     action of the directors and shareholders of each Debtor; and this
     Agreement, the Renewal Note, and the Security Agreement have in fact been
     duly executed and delivered by the Debtor and constitute its lawful and
     binding obligations, legally enforceable against it in accordance with
     their respective terms;

          (e) No litigation, tax claims or governmental proceedings are pending
     or are threatened against the Debtor or the Guarantor, and no judgment or
     order of any court or administrative agency is outstanding against the
     Debtor or the Guarantor, which will have a material adverse affect on the
     Debtor or the Guarantor;

                                      -5-
<PAGE>

          (f) The transaction evidenced by this Agreement does not violate any
     usury law or other law relating to the payment of interest on loans;

          (g) The authorization, execution, delivery and performance of this
     Agreement, the Renewal Note and the Security Agreement are not and will not
     be subject to the jurisdiction, approval or consent of, or to any
     requirement of registration with or notification to, any federal, state or
     local regulatory body or administrative agency;

          (h) When any financing statement heretofore signed by the Debtor is
     filed in the proper office where the particular collateral is located, the
     Bank will have a valid and perfected first security interest in the
     collateral described in the Security Agreement, subject to no prior
     security interest, assignment, lien or encumbrance (except interests, if
     any, specifically approved by the Bank in writing);

          (i) All assets of the Debtor are free and clear of all liens, security
     interests and encumbrances, except those specifically permitted by Bank;

          (j) Each Debtor has filed all federal and state tax returns which are
     required to be filed, and all taxes shown as due thereon have been paid;

          (k) Financial statements furnished to the Bank were prepared in
     accordance with generally accepted accounting principles consistently
     maintained, except as expressly therein set forth.  They present fairly the
     financial condition of the Debtor as of the dates thereof.  The annual
     reports disclose fully all liabilities of the Debtor whether or not
     contingent, with respect to any pension plan.  Since the date of the most
     recent financial statement, there has been no material adverse change in
     the financial condition of the Debtor;

          (1) Each qualified retirement plan of the Debtor presently conforms
     and is administered in a manner consistent with the Employee Retirement
     Income Security Act of 1974; and

          (m) All books and records pertaining to the accounts of the Debtor
     will be located in Tulsa, Oklahoma.

                           V. AFFIRMATIVE COVENANTS

     6.1  The Debtor covenants and agrees that it will:

          (a) Pay all taxes, assessments and governmental charges prior to the
     time when any penalties or interest accrue, unless contested in good faith
     with an adequate reserve for payment;

                                      -6-
<PAGE>

          (b)  Continue the conduct of its business; maintain its corporate
     existence in good standing; maintain all rights, licenses and franchises;
     comply with all applicable laws and regulations;

          (c)  Maintain its property in good working order and condition; make
     all needful and proper repairs, replacements, additions and improvements
     thereto;

          (d)  Beginning on October 25, 2000, deliver to the Bank each week a
     Borrowing Base on the form attached hereto as Exhibit "B", together with a
     weekly cash flow statement;

          (e)  Beginning on December 1, 2000 deliver to Bank each month an
     inventory listing for TANO, NMP and MC II:

          (f)  Deliver to the Bank and to any participant designated by the
     Bank:

               (1) Beginning December 1, 2000, quarterly balance sheet and
          income statements to be delivered within thirty (30) days after its
          due date.

               (2)  Beginning March 31, 2001, annual audited financial
          statements, to be delivered within ninety (90) days after its due
          date.

               (3)  Beginning October 25, 2000, weekly Accounts Receivable
          Aging/Listings and Borrowing Base to be delivered within two (2) days
          after the end of each week.

               (4)  Beginning on September 1, 2001, annual audited financial
          statement of the Guarantor, to be delivered within (90) after its due
          date.

               (5)  Guarantor's 2000 Federal Income Tax Return and annually
          thereafter, to be delivered within ten (10) days of its filing.

          (g)  Maintain a "Leverage Ratio" of no greater than 8.0 to 1.0.  The
     Debtor will provide the Bank, within forty-five (45) days after the close
     of each of its fiscal year's quarter, with information reasonably needed by
     the Bank to determine the Leverage Ratio.  As used herein, Leverage Ratio
     shall be defined as the ratio of the Debtor's total liabilities less the
     Debtor's debt, which is subordinate to the Bank's debt and has been
     approved by Bank, ("Subordinated Debt") to the Debtor's tangible net worth
     plus Debtor's Subordinated Debt;

          (h) Maintain a "Liquidity Ratio" of 1.0 to 1.0.  The Debtor will
     provide the Bank, within forty-five (45) days after the close of each of
     its fiscal year's quarter, with information reasonably needed by the Bank
     to determine the Liquidity Ratio.  As used herein, Liquidity Ratio shall be
     defined as the ratio of the Debtor's current assets to the Debtor's current
     liabilities;

                                      -7-
<PAGE>

          (i)  Permit any officer, employee, attorney or accountant for the Bank
     or for any participant designated by the Bank, to review, make extracts
     from, or copy any and all of its corporate and financial books, records and
     properties of the Debtor at all times during ordinary business hours;

          (j)  Maintain property, liability, workman's compensation and other
     forms of insurance in amounts designated at any time or from time to time
     by the Bank;

          (k)  Not change any of the Debtor's senior management without the
     Bank's prior approval; and

          (l)  Do, make, procure, execute and deliver at its expense all acts,
     things, writings and assurances which the Bank may at any time reasonably
     request in order to protect, assure, or enforce the interests, rights and
     remedies of the Bank created by, provided in or emanating from this
     Agreement, and the Security Agreement.

     5.2  The Debtor further covenants and agrees that it will notify the Bank
in writing promptly, and in any event within five (5) business days, in the
event of the occurrence of any Event of Default defined or described in Section
7.1 or the occurrence of any event which, with the giving of notice or lapse of
time (or both), would become such an Event of Default.

                            VI. NEGATIVE COVENANTS

     6.1  The Debtor covenants and agrees that it will not, without the express
written consent of the Bank:

          (a)  Become or remain liable in any manner in respect of any
     indebtedness or contractual liability (including, without limitation,
     notes, bonds, debentures, loans, guaranties, and pension liabilities,
     whether or not contingent and whether or not subordinated), except:

               (1)  Indebtedness arising under this Agreement;

               (2)  Indebtedness arising under the Subordinated Debt;

               (3)  Presently outstanding unsecured indebtedness, if any, to the
          extent disclosed in the financial statements identified in Section
          4.1(k);

               (4)  Unsecured indebtedness, other than for money borrowed or for
          the purchase of a capital asset, incurred in the ordinary course of
          its business, which becomes due and must be fully satisfied within
          twelve (12) months after the date on which it is incurred; and

                                      -8-
<PAGE>

               (5)  Unsecured indebtedness subordinated in right of payment to
          all indebtedness owed to the Bank pursuant to a debt subordination
          agreement accepted or approved in writing by the Bank;

          (b)  Create, incur or cause to exist any mortgage, security interest,
     encumbrance, lien or other charge of any kind upon any of its property or
     assets, whether now owned or hereafter acquired, except:

               (1)  The security interests created by the Security Agreement;

               (2)  Security interests created by the Subordinated

               (3)  Liens for taxes or assessments not yet due or contested in
          good faith by appropriate proceedings;

               (4) Security interest approved by the Bank in writing, at its
          sole discretion; and

               (5) Other liens, charges and encumbrances incidental to the
          conduct of its business or the ownership of its property which were
          not incurred in connection with the borrowing of money or the purchase
          of property on credit and which do not in the aggregate materially
          detract from the value of its property or materially impair the use
          thereof in its business.

          (c) Expend or contract to expend funds for the purchase or lease of
     any property, whether real, personal or mixed, except current assets
     purchased in the ordinary course of business;

          (d) Sell, lease or otherwise dispose of all or any substantial part of
     its property;

          (e) Consolidate or merge with, or acquire assets of, any other
     corporation or business;

          (f) Substantially alter the nature of the business in which it is
     engaged, or enter into a new business;

          (g) Declare or pay any dividends (except dividends payable solely in
     its capital stock, or dividends needed to pay current federal and state
     income tax liability as long as Debtor remains sub-S corporation), or
     purchase or redeem any of its capital stock, or otherwise distribute any
     property on account of its capital stock;

          (h)  Purchase stock or securities of,, extend credit to or make
     investments in, become liable as surety for, or guarantee or endorse any
     obligation of, any person, firm or corporation, except direct obligations
     of the United States and commercial bank deposits;

                                      -9-
<PAGE>

          (i)  In any manner transfer any property without prior or present
     receipt of full and adequate consideration;

          (j)  Permit funds to be owing to the Debtor by the directors or
     shareholders of Debtor, or members of their families, on account of any
     loan, credit sale or other transaction or event;

          (k)  Pay excessive or unreasonable salaries, bonuses, fees,
     commissions or other compensation; and

          (l) Permit any default or event of default to occur under any note,
     loan agreement, lease, mortgage, contract for deed, security agreement or
     other contractual obligation binding upon Debtor.

                            VII. EVENTS OF DEFAULT

     7.1  Each of the following occurrences shall constitute an Event of
Default:

          (a)  The Debtor shall fail to pay any installment of interest due on
     the Renewal Note, or Debtor shall fail to pay any amount of principal or
     interest due on the Renewal Note on the Maturity Date as defined in the
     Renewal Note, and such failure shall continue for five (5) calendar days;

          (b) The Debtor shall fail to perform or observe any of the covenants
     contained in Sections V and VI of this Agreement, and such failure shall
     continue for a period of ten (10) calendar days;

          (c) Any representation or warranty contained in Section IV shall prove
     to have been materially false or misleading as of this date or (except to
     the extent of changes caused by transactions permitted under this
     Agreement) as of any date on which a loan is made to the Debtor under this
     Agreement; or any other representation or warranty made by or on behalf of
     the Debtor to the Bank (whether made in this Agreement, in any financial
     statement, report or certificate furnished pursuant to this Agreement, or
     otherwise in any manner) shall prove to have been false or materially
     misleading as of the time as of which such representation or warranty was
     made;

          (d)  The Debtor shall fail to pay when due any substantial liability
     or liabilities other than the Renewal Note, including, but not limited that
     certain Promissory Note executed by Debtor to the order of the Bank dated
     August 13, 1999 in the original principal amount of Two Million and No/100
     Dollars ($2,000,000.00); or the maturity of any such liability or
     liabilities shall be accelerated; or any breach, default or event of
     default shall occur under any indenture, loan agreement, note or agreement
     pertaining to any such liability, entitling a creditor or representative of
     creditors of the Debtor, acting with or without the consent or concurrence
     of other creditors and with or without notice or a period of grace, to
     accelerate the maturity of or demand payment of any such liability, whether
     such

                                      -10-
<PAGE>

     breach, default or event of default is waived by the creditor so
     entitled.  "Substantial" for these purposes, means in excess of Twenty-Five
     Thousand and No/ 100 Dollars ($25,000.00);

          (e)  Any breach, default or event of default shall occur under the
     Security Agreement, or under any other agreement, conveyance or instrument
     now in effect or hereafter made for the benefit of the Bank in connection
     with or as security for indebtedness arising under this Agreement;

          (f)  The Debtor shall have procured, permitted or suffered,
     voluntarily or involuntarily, any creditor to obtain a lien not permitted
     herein upon all or any substantial part of its property by operation of law
     or the appointment by any court or public authority (other than a
     bankruptcy court) of any receiver or trustee to take charge of, or the
     sequestration of, all or any substantial part of its property; or shall
     commit an act of bankruptcy under the United States Bankruptcy Act (as now
     or hereafter amended); or shall file or have filed against it, voluntarily
     or involuntarily, a petition in bankruptcy or for reorganization or the
     adoption of an arrangement under the United States Bankruptcy Act (as now
     or hereafter amended); or shall initiate or have initiated against it,
     voluntarily or involuntarily, any act, process or proceeding for
     liquidation, dissolution, arrangement, composition or reorganization or
     under any insolvency law or other statute or law providing for a
     modification or adjustment of the rights of creditors; and

          (g)  Any event or reportable event which the Bank in good faith
     determines to constitute potential grounds for the termination of any
     employee benefit plan or other plan maintained for employees of the Debtor,
     or for the appointment of a trustee to administer any such plan, shall have
     occurred and be continuing thirty (30) calendar days after written notice
     to such effect shall have been given by the Bank to the Debtor; or any such
     plan shall be terminated, or a trustee shall be appointed to administer any
     such plan; or the Pension Benefit Guaranty Corporation shall institute
     proceedings to terminate any such plan or to appoint a trustee to
     administer any such plan.

     7.2  Upon the occurrence of an Event of Default or at any time thereafter
until such Event of Default is waived in writing, if capable of being cured, is
cured to the written satisfaction of the Bank, the Bank at its option may
exercise one or more of all of the following rights and remedies:

          (a)  Terminate the obligations of the Bank under this Agreement; and

          (b)  Declare the indebtedness evidenced by the Renewal Note to be
     immediately due and payable, and the same shall thereupon be immediately
     due and payable, without notice or presentment or other demand, and the
     Bank thereupon may exercise and enforce all rights and remedies available
     to it to collect the indebtedness evidenced by the Renewal Note;

          (c)  Exercise and enforce all rights and remedies accorded upon
     default to a secured party;

                                      -11-
<PAGE>

          (d)  Without notice to or demand upon the Debtor or any other person,
     off set any indebtedness then owed to the Bank by the Debtor, whether or
     not such indebtedness is then due, against the indebtedness evidenced by
     the Renewal Note (including, without limitation, indebtedness transferred
     by the Bank to a third party by participation, negotiation, assignment,
     succession or otherwise) and any other indebtedness then owed by the Debtor
     to the Bank, whether or not then due, and exercise any and all other rights
     of set off, application or banker's lien available to the Bank by law or
     agreement.

     7.3  Any Event of Default may be waived in writing by the Bank, but not
otherwise; and the failure to exercise the rights and remedies referred to in
Paragraph 7.2 shall not operate as a waiver or otherwise preclude enforcement of
such rights and remedies.  A waiver shall be effective only in the specific
instance and for the specific purpose given.  The rights and remedies of the
Bank shall be cumulative and the exercise or enforcement of any one right or
remedy shall neither be a condition to nor bar the exercise and enforcement of
any other.

     7.4  The Debtor agrees to pay the Bank, on demand.  the amount of all out-
of-pocket expenses, including the reasonable fees and disbursements of legal
counsel for the Bank, incurred or paid by the Bank in connection with or as a
result of the exercise or enforcement of any right or remedy referred to in
Section 7.2, except to the extent payment of the same by the Debtor may be
prohibited by law.

                             VIII.  MISCELLANEOUS

     8.1  All notices to be given to the Debtor hereunder shall be sufficiently
given if sent in writing by certified or registered mail, addressed to the
Debtor at 12402 East 60th Street, Tulsa, OK 74146, Attention: CFO, and to the
Bank at P.O. Box 521500, Tulsa, OK 74152, Attention: President, or addressed to
such other address or to the attention of such other person as any party may
from time to time designate in written notice to the other party.

     8.2  The Debtor shall pay to the Bank, upon the execution of the Renewal
Note a loan fee of Four Thousand and No/100 Dollars ($4,000.00) and the amount
of all reasonable out-of-pocket expenses, including the fees, and disbursements
of legal counsel for the Bank paid or incurred by the Bank in connection with
the preparation, execution, delivery and performance of this Agreement, the
Renewal Note, the Security Agreement, the Guaranty, the Pledge and the
Assignment and all documents deemed necessary by the Bank.  The Debtor agrees to
indemnify and hold harmless the Bank from and against any and all taxes,
assessments and other charges (except net income taxes) levied or based upon or
payable in connection with the execution, delivery and performance of this
Agreement or the Renewal Note, the Security Agreement, or levied or based upon
payable in connection with, or measured by the indebtedness evidenced by the
Note.

     8.3  This Agreement shall inure to the benefit of, extend to and be
binding upon the respective successors and assigns of the Debtor and the Bank,
including any participant of the Bank.  The term "Bank", as used herein,
includes any subsequent holder of the Renewal Note.  This Agreement cannot be
modified, amended, waived, canceled, terminated or otherwise changed orally.

                                      -12-
<PAGE>

This Agreement is made and the Renewal Note will be issued under, and each shall
be governed and construed by the substantive laws of, the State of Oklahoma If
any provision of this Agreement is held invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect other
provisions which can be given effect, and this Agreement shall be given effect,
and shall be construed as if such invalid or illegal or unenforceable provision
had never been contained herein.  All representations and warranties contained
in this Agreement shall survive the execution and delivery of this Agreement and
the issuance of the Renewal Note.

     8.4   This Agreement supercedes and replaces that certain Loan Agreement
between the parties dated August 13, 1999 ("1999 Loan Agreement"), INSOFAR AND
ONLY INSOFAR as the provisions of the 1999 Loan Agreement pertain to the
Revolving Note as defined in the 1999 Loan Agreement. As to the Term Note, as
defined in the 1999 Loan Agreement, the 1999 Loan Agreement remains in full
force and effect.

     IN WITNESS WHEREOF, this Agreement is executed as of the day and year first
above written.

                                   "DEBTOR"

                                   Westwood Corporation,
                                   a Nevada corporation

                                   By: /s/ Ernest H. McKee
                                       ---------------------------------------
                                           Ernest H. McKee, President

                                   TANO Corp.,
                                   a Louisiana corporation

                                   By: /s/ Guy Hardwick
                                       ---------------------------------------
                                           Guy Hardwick, President

                                   NMP Corp.,
                                   an Oklahoma corporation

                                   By: /s/ Ernest H. McKee
                                       ---------------------------------------
                                           Ernest H. McKee, President

                                      -13-
<PAGE>

                              MC II Electric Company,
                              a Texas corporation

                              By: /s/ Ernest H. McKee
                                  ------------------------------------
                                      Ernest H. McKee, President

                              "GUARANTOR"

                              /s/ Ernest H. McKee
                              ----------------------------------------
                              Ernest H. McKee

                              "BANK"
                              Stillwater National Bank and Trust Company,
                              Stillwater, Oklahoma

                              By: /s/ Joe E. Staires
                                  ------------------------------------
                                      Joe E. Staires, Senior Vice-President

                                      -14-
<PAGE>

                                  EXHIBIT "A"

                              RENEWAL AND AMENDED
                              -------------------
                                   REVOLVING
                                   ---------
                                PROMISSORY NOTE
                                ---------------

$2,800.000.00                                                Tulsa, Oklahoma
                                                            October 25, 2000

KNOW ALL MEN BY THESE PRESENTS, THAT:

     FOR VALUE RECEIVED, the undersigned, WESTWOOD CORPORATION, a Nevada
corporation, TANO CORP., a Louisiana corporation, NMP CORP., an Oklahoma
corporation, and MC II ELECTRIC COMPANY, a Texas corporation (hereinafter
collectively called the "Maker"), promises to pay to the order of STILLWATER
NATIONAL BANK AND TRUST COMPANY, STILLWATER, OKLAHOMA, a National Banking
Corporation ("SNB" or the "Holder"), on or before March 25, 2001. (hereinafter
called the "Maturity Date") the principal sum of Two Million Eight Hundred
Thousand and No/ 100 Dollars ($2.800,000.00) (hereinafter called the "Face
Amount"), or so much thereof which is actually outstanding from time to time, in
lawful money of the United States of America, together with all costs herein
provided and interest at the "Contract Rate" (defined below) on the principal
balance outstanding hereof and thereon from the date hereof until said amounts
shall have been paid in full as more specifically provided below.

     1.  REVOLVING CREDIT.  This Note will evidence a revolving line of credit
         ----------------
to Maker.  Subject to the terms and conditions of the "Loan Agreement"
pertaining to the loan evidenced by this Note, which is of even date herewith
between Maker and Holder, Maker shall have the right from time to time during
the term of this Note to borrow and, upon repayment, re-borrow from the Holder
amounts having the aggregate principal balance at any one time not exceeding the
lesser of (i) the "Borrowing Base" (defined below) determined as of the date of
any borrowing or re-borrowing, or (ii) the Face Amount.  Advances under this
Note shall be made in accordance with Paragraphs 1.1,1.2 and 1.3 of the Loan
Agreement.  Maker agree to be liable for all sums advanced in accordance with
Paragraphs 1.1,1.2 and 1.3 of the Loan Agreement.  The unpaid principal balance
owing on this Note at any time may be evidenced by endorsements on this Note or
by Holder's internal records, including daily computer print-outs.  Holder will
have no obligation to advance funds under this Note if: (i) Maker or any
guarantor is in default under the terms of this Note, the Loan Agreement, the
"Security Agreement" (defined below) or any agreement that Maker or any
guarantor has with Holder, including any agreement made in connection with the
signing of the Note; (ii) Maker or any guarantor ceases doing business or is
insolvent; (iii) and any guarantor seeks, claims or otherwise attempts to limit,
modify or revoke such guarantor's guarantee of this Note or any other loan with
Holder; (iv) Maker have applied funds provided pursuant to this Note for
purposes other than those authorized by Holder; or (v) Holder in good faith
deems itself insecure under this Note or any other agreement between Holder and
Maker.  For these purposes Borrowing Base, Trade Accounts Receivable and
Eligible Trade Accounts Receivable will have the meaning as defined in the Loan
Agreement.

                                      -1-
<PAGE>

     2.  INTEREST ONLY.  Maker shall pay the Holder monthly payments of interest
         -------------
only, to-wit: Beginning on November 25, 2000, and on the same day of each month
thereafter until the Maturity Date, monthly payments of interest only shall be
paid in arrears on the outstanding principal balance.  At the Maturity Date all
accrued but unpaid interest and the unpaid principal balance shall be due and
payable.  PROVIDED, HOWEVER, so often as the principal balance of this Note
shall ever exceed the Borrowing Base.  Maker shall immediately notify Holder of
such event and Maker shall immediately, without the necessity of Holder making a
demand or giving notice to Maker or to any person obligated to pay the
indebtedness of this Note, pay Holder so much of the outstanding principal so
that the then remaining principal balance shall equal or be less than the
Borrowing Base.

     3.  VARIABLE INTEREST RATE.  The interest rate on this Note is the
         ----------------------
"Contract Rate" (defined below), and is subject to change from time to time
based on changes in the "Index" (defined below).  The "Contract Rate" shall be a
rate per annum equal to the sum of the "Base Rate" (defined below) and the
"Margin" (defined below).  The Contract Rate shall fluctuate during the term of
this Note based upon the sum of the Base Rate and the Margin.  The Note shall
initially bear interest at the rate of Ten Percent and One-Half Percent (10.5%)
per annum ("Initial Interest Rate"), which is based on a current Base Rate of
Nine and One-Half Percent (9.5%) per annum, plus the Margin.

     The Base Rate may be adjusted up or down DAILY, and shall equal the lowest
base rate on corporate loans posted by at least 75% of the nation's 30 largest
banks as published in the money rates section of the southwest edition of the
Wall Street Journal.  Holder will inform Co-Makers what the current Base Rate is
-------------------
at any time during the term of this Note upon request of Co-Makers.  The Base
Rate will not change more often than each DAY.

     The Margin shall be one (1) percentage point.

     4.  DAILY INTEREST.  Interest shall be calculated on the daily principal
         --------------
balance based on the actual number of days elapsed in the interest payment
period over a year of three hundred sixty (360) days.  All payments which are
due on a Saturday, Sunday or national bank holidays shall be deemed to be
payable on the next bank business day.

     5.  COLLATERAL.  This Note and all amounts due hereunder are secured by the
         ----------
account receivables of and inventory of the Maker as described and set forth in
that certain Security Agreement of even date herewith (hereinafter called the
"Security Agreement"), given by Maker.

     6.  PREPAYMENT.  Maker shall have the right to prepay this Note, in whole
         ----------
or in part, at any time without penalty or premium.

     7.  ACCELERATION UPON DEFAULT.  It is agreed that time is of the essence in
         -------------------------
the performance of all obligations hereunder and under the Security Instruments.
Maker and each surety, endorser and guarantor hereof, jointly and severally,
covenant and agree that upon the occurrence of any Event of Default as defined
in the Security Agreement or any other Security Instrument, then and in any of
such events the Holder hereof may, at its option and without notice or

                                      -2-
<PAGE>

demand, declare this Note and all unpaid principal and accrued interest
hereunder immediately due and payable. The I-colder hereof shall not be liable
for failure to collect or for lack of diligence in bringing suit on this Note or
on any renewal or extension hereof or upon or with respect to any security or to
foreclose the Mortgage given to secure the payment hereof or for failure to make
demand or presentment for payment or to protest or give notice of protest,
dishonor or non-payment or any other notice, or generally for any act of
omission or commission. The failure of the Holder hereof to exercise any of the
remedies or options set forth in this Note, the Security Agreement or any other
Security Instrument, upon the occurrence of one or more of the Events of
Default, including without limitation the right to exercise its option of
acceleration, shall not constitute a waiver of the right to exercise the same or
any other remedy at any subsequent time in respect to the same or any other
Event of Default.

     8.    DEFAULT INTEREST RATE.  Upon the occurrence of any Event of Default
           ---------------------
hereunder, or upon maturity hereof (by acceleration or otherwise), the entire
unpaid principal sum and then accrued and unpaid interest, at the option of
Holder, shall bear interest at the rate of six percent (6%) in excess of the
Base Rate.

     9.    JOINT AND SEVERAL; LIABILITY; ATTORNEY'S FEES.  This Note shall be
           ---------------------------------------------
the joint and several obligation of all makers, and it shall be the joint and
several obligation of all endorsers, guarantors and sureties, and shall be
binding on all parties hereto and their successors and assigns.  All makers,
endorser, guarantors and sureties hereof agree jointly and severally that if,
and as often as, this Note is placed in the hands of any attorneys for
collection or to defend or enforce any of the Holder's rights hereunder, Maker
shall pay to the Holder on demand its reasonable attorney's fees, together with
all court costs and other expenses paid by such Holder.

     10.   WAIVERS.  Except as otherwise specifically provided in this Note, the
           -------
Security Agreement, or any guaranty agreement, or any Security Agreement, all
makers, endorsers, guarantors and sureties hereof jointly and severally waive
presentment, protest, notice of protest, notice of dishonor, diligence in
collection, and any and all other notices and matters of alike nature.  All
makers, endorsers, guarantors and sureties consent to: (i) any renewal,
extension or modification (whether one or more) of the terms of the Security
Instruments, including the terms or time of payment under this Note; (ii) the
release or surrender, exchange or substitution of all or any part of the
security, whether real or personal or direct or indirect, for the payment
hereof; (iii) the granting of any other indulgences to Maker, including, without
limitation, the advancement of additional principal and extension of additional
credit so that the principal balance remaining is above the Face Amount hereof,
and (iv) the taking or releasing of other or additional parties primarily or
contingently liable hereunder.  Any such renewal, extension, modification,
release, surrender, exchange or substitution may be made without notice to Maker
and any endorsers, guarantors and sureties hereof and without affecting the
liability of said parties hereunder.

     11.   ONE INSTRUMENT; OKLAHOMA LAW.  This Note and the Security Instruments
           ----------------------------
are to be construed as one contract and each hereby referred to and made a part
of the other. This Note is being executed and delivered and is intended to be
performed in the State of Oklahoma and shall be construed and enforced in
accordance with and governed by the laws of the State of Oklahoma.

                                      -3-
<PAGE>

     12.   MODIFICATIONS, FORBEARANCE.  This Note may not be modified or
           --------------------------
terminated orally, but only by agreement or discharge in writing and signed by
Holder.  Any forbearance of Holder in exercising any right or remedy hereunder
or under the Security Instruments, or otherwise afforded by applicable law,
shall not be a waiver of or preclude the exercise of any right or remedy.  The
acceptance by Holder of payment of any sum payable hereunder after the due date
of such payment shall not be a waiver of Holder's right to require prompt
payment when due of all other sums payable hereunder and shall not constitute an
implied or tacit approval for the late or delinquent payment of any other
installment due hereunder.

     13.   SUCCESSORS OF HOLDER.  Whenever the term "Holder" is referred to in
           --------------------
this Note, such reference shall be deemed to include the successors and assigns
of Holder, including, without limitation, any subsequent assignee or holder of
this Note, and all covenants, provisions and agreements by or on behalf of Maker
and any endorsers, guarantors and sureties hereof which are contained herein
shall inure to the benefit of the successors and assigns of Holder.

     14.   CURATIVE INTEREST RATE.  All agreements between the Maker and the
           ----------------------
Holder are expressly limited so that in no event whatsoever, whether by reason
of disbursement of the proceeds hereof or otherwise, shall the amount of
interest or finance charge (as defined by the laws of the State of Oklahoma)
paid or agreed to be paid by the Maker to the Holder hereof exceed the highest
lawful contractual rate of interest or the maximum finance charge permissible
under the law which a court of competent jurisdiction, by final non-appealable
order, determines to be applicable hereto.  If fulfillment of any agreement
between the Maker and the Holder hereof., at the time the performance of such
agreement becomes due, involves exceeding such highest lawful contractual rate
or such maximum permissible finance charge, then the obligation to fulfill the
same shall be reduced automatically so that such obligation does not exceed such
highest lawful contractual rate or such maximum permissible finance charge.  If
by any circumstance the Holder shall ever receive as interest or finance charge
an amount which would exceed the amount allowed by applicable law, the amount
which may be deemed excessive shall be deemed applied to the principal of the
indebtedness evidenced hereby and not to interest.  All interest and finance
charges paid or agreed to be paid to the Holder hereof shall be prorated,
allocated and spread throughout the full period of this Note.  The terms and
provisions of this paragraph shall control all other terms and provisions
contained herein and in any of the other Security Instruments executed in
connection herewith.

     15.   NOTICES.  Any notice, report, demand or other instrument authorized
           -------
or required to be given or furnished under this Note to the Maker or the Holder
shall be deemed given, received and furnished: (i) when personally delivered; or
(ii) three (3) days after the same is deposited in the United States mail as
first class certified mail, return receipt requested, postage prepaid; or (iii)
the day after such notice is deposited with an overnight delivery service, such
as Federal Express, Airborne, etc.; or (iv) via confirmed telecopy or facsimile,
to the address as follows:

                                      -4-
<PAGE>

     Addresses for such Notices are as follows:

     IF TO HOLDER:
     ------------

     STILLWATER NATIONAL BANK & TRUST COMPANY
     Attn: President
     P.O. Box 521500
     Tulsa, Oklahoma 74152-1500
     Phone: (918) 523-3600
     Fax: (918) 523-3894

     IF TO MAKER:
     -----------

     Westwood Corporation, et al.
     Attn: CFO
     5314 South Yale, Suite 1100
     Tulsa, Oklahoma 74135
     Phone: (918) 524-0002
     Fax: (918) 524-0006

     Either party may change the address to which any such notice, report,
demand or other instrument is to be delivered or mailed by furnishing written
notice of such change to the other party, but no such notice of change shall be
effective unless and until received by such other party.  Copies of notices
given to the specified persons are for information only and notice shall not be
effected by giving notice solely to said persons.  The above addresses shall
also constitute the addresses of the parties for the purposes of (S) 9-402 of
the Oklahoma Uniform Commercial Code and any similar provision of the Uniform
Commercial Code of any other state where the Mortgaged Property is located, and
for such purposes the Maker shall be the debtor and the Holder shall be the
secured party.

     16.  UNENFORCEABLE TERMS.  If any provision of this Note or the application
          -------------------
thereof to any party or encumbrance is held invalid or unenforceable, the
remainder of this Note and the application of such provision to other parties or
circumstances shall not be affected thereby, the provisions of this Note being
severable in any such instance.

     17.  BUSINESS PURPOSES.  This Note is given for an actual loan of money for
          -----------------
business purposes and not for personal, residential or agricultural purposes.

     18.  EVIDENCE OF DEBT.  The records of the Holder of this Note shall be
          ----------------
prima facie evidence of the amount owing on this Note.

     19.  RENEWAL AND AMENDED NOTE.  This Renewal and Amended Revolving
          ------------------------
Promissory Note is a renewal of and amendment to that certain Revolving
Promissory Note between Holder and Maker dated August 13, 1999, in the original
face amount of Two Million and No/100 Dollars ($2,000,000.00).

                                      -5-
<PAGE>

     IN WITNESS WHEREOF, the undersigned has executed this Note on the date
first above written.

                                 "MAKER"
                                 Westwood Corporation,
                                 a Nevada corporation

                                 By:_______________________________________
                                       Ernest H. McKee, President

                                 TANO Corp.,
                                 a Louisiana corporation

                                 By:_______________________________________
                                       Guy Hardwick, President

                                 NMP Corp.,
                                 an Oklahoma corporation

                                 By:_______________________________________
                                       Ernest H. McKee, President

                                 MC II Electric Company,
                                 a Texas corporation

                                 By:_______________________________________
                                       Ernest H. McKee, President

                                      -6-
<PAGE>

                            EXHIBIT B to EXHIBIT 1
                            ----------------------

              BORROWING BASE CERTIFICATE AND COMPLIANCE STATEMENT

     The Borrowing Base Certificate is delivered under the terms and compliance
with a LOAN AGREEMENT by and between STILLWATER NATIONAL BANK AND TRUST COMPANY
OF STILLWATER, OKLAHOMA, and BORROWER therein named for is Note No. 41554.

TO:  STILLWATER NATIONAL BANK AND TRUST COMPANY OF STILLWATER, OKLAHOMA

     The undersigned is ____________ of BORROWER as defined in the LOAN
AGREEMENT referred to above.  The undersigned reaffirms all representations and
warrants made by BORROWER in the LOAN AGREEMENT referred to above and certifies
and warrants that it holds, subject to the security interest of LENDER, the
collateral described in the Borrowing Base calculation below:

<TABLE>
<S>                                                                                                       <C>
Total Accounts as shown in the attached Accounts Receivable
Aging Report as of the end of  _______________________________                                            $_______________ (a)

     Less:
     Accounts of Subsidiaries and Affiliates                                                              $_______________ (b)

     Accounts outstanding more than ninety (90) days
          from the date of the invoice                                                                    $_______________ (c)

     Account debtors not located in the United States
          of America or Canada                                                                            $_______________ (d)

     Accounts of Account debtor previously disapproved by BANK                                            $_______________ (e)

     Amount of Accounts representing retainage                                                            $_______________ (f)

     Total Accounts of account debtor when more than ninety (90) days
     have expired from the date of the invoice of more than ten
     percent (10%) (in dollars) of the debtor's Accounts Receivable                                       $_______________ (g)

     Total Accounts of account debtors to whom Borrower is indebted                                       $_______________ (h)

     Total Ineligible Account [Total of (b) through (h)]                                                  $_______________ (i)

     Potential Total Eligible Trade Accounts Receivable (a) less (i)                                      $_______________ (j)

     Less Concentration - the amount of Account debtors' accounts in
     excess of 15% and total Eligible Accounts Receivable calculated
     without this Deduction, with the exception of Ingalls
     Shipbuilding which will not exceed 50%.                                                              $_______________ (k)

     Less Government Progress Payments in excess of $300,000                                              $_______________ (l)

     Total Eligible Trade Accounts Receivable (j) less (k and l)                                          $_______________ (m)

Receivable Portion of BORROWING BASE [75% of (l)]                                                         $_______________ (n)

Eligible Inventory of NMP Corp. $________ LESS MC II Inventory $________  equals $_________
(the lesser of 50% of the cost of raw materials and finished products and 50% of the fair market value
of raw materials and furnished products) as of the end of _______________
NOT TO EXCEED $1,500,000 CHANGING TO $1,250,000 ON 12/31/00.                                              $_______________ (o)
BORROWING BASE (m) plus (o)                                                                               $_______________ (p)

     Total Loan Amount                                                                                    $_______________ (q)
</TABLE>
<PAGE>

<TABLE>
     <S>                                                                                                  <C>
     Less: Principal Balance of loan as of ____________________
          (Same date as Accounts Receivable Aging Report)                                                 $_______________ (r)

     Principal balance of Loan not advanced [(p) - (q)]                                                   $_______________ (s)

     Principal Amount of Loan subject to being advanced (the
     lesser of (o) or (p) minus (q)                                                                       $_______________ (t)
</TABLE>

If (o) minus (q) is a negative number, attached you will find a check payable to
LENDER in the amount of $ _______________the amount (o) exceeds (q) to reduce
the principal of the loan.

Unless and until a new subsequent Borrowing Base Certificate and Compliance
Statement is received by LENDER, the maximum principal balance outstanding shall
not exceed the lesser of (o) and (q).

________________________________________________________________________________
                                 ADVANCE REQUEST

     AMOUNT OF ADVANCE REQUEST    $_______________

     DEPOSIT TO ACCOUNT           $_______________
________________________________________________________________________________

                                    WESTWOOD CORPORATION

     Date:_____________             By:_______________________________________

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00027-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00027-of-00352.parquet"}]]