Document:

Exhibit
10.2

     

    NOTE
MODIFICATION

     

    THIS NOTE
MODIFICATION dated as of February 19, 2010, is executed by AEROSONIC CORPORATION
(the “Company”), a Delaware corporation, OP TECHNOLOGIES, INC., an Oregon
corporation, and AVIONICS SPECIALTIES, INC., a Virginia corporation,
(collectively, “Borrowers”) for  the benefit of Bruce J. Stone
(“Stone”).

     

    RECITALS

     

    WHEREAS,
the Company and Stone are parties to a Loan Agreement dated as of May 14,
2009 (the “Loan Agreement”) as evidenced by a note dated May 14, 2009 executed
and delivered by the Borrowers to Stone (the “Note”); and

     

    WHEREAS,
the Company has requested that Stone agree to amend and waive certain provisions
of the Loan Agreement and Stone is agreeable to such request but only upon the
terms and subject to the conditions set forth herein.

     

    WHEREAS,
the Company and Stone shall enter into a First Amendment to Loan Agreement dated
as of February 19, 2010 (the “Loan Amendment”).

     

    WHEREAS,
in connection with the Loan Amendment, the Borrowers shall amend and modify the
Note as follows:

    

    1.           Amendments

    

    (a)  Section
2 of the Note is hereby amended and modified by deleting therefrom the
definition of “Maturity
Date” in its entirety and inserting the following new
definition:

    

    “’Maturity
Date’ means the earlier of:  (i) April 10, 2011, or (ii) the maturity
of the Existing Loans.”  

    

    (b)  Section
3 of the Note is hereby amended and modified by deleting therefrom the words
“April 10, 2010” and replacing with the words “April 10, 2011”.

    

    2.           The
State of Florida documentary excise tax in the amount of $2,450.00 has
previously been paid directly to the Florida Department of Revenue.

     

    3.           All
references in the Note to “Loan Agreement” shall refer to the Loan Agreement as
amended by the Loan Amendment.

     

    4.           Notwithstanding
the execution of this Note Modification, the Note shall remain in full force and
effect, as modified hereby; and nothing herein contained and nothing done
pursuant hereto shall be construed to release, satisfy, discharge, terminate or
otherwise affect or impair in any manner whatsoever the validity or
enforceability of the indebtedness evidenced by the Note, except as expressly
modified hereby.

     

    5.           The
validity, construction, interpretation, and enforcement of this Note
Modification are governed by the laws of the State of Florida and the federal
laws of the United States of America, excluding the laws of those jurisdictions
relating to the resolution of conflicts with laws of other
jurisdictions.  

    

    [Signature
pages follow]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    EXECUTED:  February
19, 2010

    

    
      
        
          
            
              
                
                  	 
      	 
      	
                          AEROSONIC
      CORPORATION

                        
	 
      	 
      	
                          AVIONICS
      SPECIALTIES, INC.

                        
	 
      	 
      	
                          OP
      TECHNOLOGIES, INC.

                        
	 
      	 
      	 
      
	
                          WITNESSES:

                        	 
      	
                          By: 

                        	
                          /s/
      Douglas J. Hillman

                        
	 
      	 
      	 
      	
                          Douglas
      J. Hillman

                        
	 
      	 
      	 
      	
                          President
      and Chief Executive Officer

                        
	
                            

                        	 
      	 
      
	
                          Print Name:

                        	
                            

                        	 
      	 
      
	 
      	 
      	 
      
	
                            

                        	 
      	 
      
	
                          Print Name:

                        	
                            

                        	 
      	 
      

                

              

            

          

        

      

    

    
      
         

      

      
        2Exhibit
10.3

     

    FIRST
AMENDMENT

    TO

    LOAN
AGREEMENT

     

    This
First Amendment to Loan Agreement (this “Amendment”) dated as
of February 19, 2010, under the Loan Agreement, dated as of May 14, 2009 (the
“Loan
Agreement”) by and between Aerosonic Corporation, a Delaware corporation
(the “Company”) and Redmond Family Investments LLLP (“Redmond”).

     

    RECITALS

     

    WHEREAS,
the Company and Redmond are parties to the Loan Agreement; and

     

    WHEREAS,
the Company has requested that Redmond agree to amend and waive certain
provisions of the Loan Agreement and Redmond is agreeable to such request but
only upon the terms and subject to the conditions set forth herein.

     

    NOW,
THEREFORE, in consideration of the premises and the mutual agreements contained
herein, and for other valuable consideration the receipt of which is hereby
acknowledged, the Company and Redmond agree as follows:

     

    1.  Definitions.  Unless
otherwise defined herein, capitalized terms are used herein as defined in the
Loan Agreement.

     

    2.  Amendments.

     

    2.1  Amendments to Loan
Agreement.

     

    (a)  Section 1.1
of the Loan Agreement is hereby amended by deleting therefrom the following
definitions in their entireties and inserting the following new definitions in
the appropriate alphabetical order:

    

    “’Note’
means the 14% Subordinated Note due April 10, 2011, as extended pursuant to the
terms and conditions of the Note, in the aggregate principal amount of $500,000,
to be issued to Redmond at the Closing by the Company and the Subsidiaries in
the form of Exhibit
1.

    

    “Warrant”
means for any Warrant issued to Redmond prior to February 19, 2010, a Common
Stock Purchase Warrant of the Company to purchase at any time after the one-year
anniversary date of their original issue date until April 10, 2020, one share of
the Common Stock for a purchase price of $.64 per share, subject to
anti-dilution protection and adjustment of the warrant price and number of
shares as provided in the Warrant Certificate.  For any Warrant issue
to Redmond on or after February 19, 2010, a Common Stock Purchase Warrant of the
Company to purchase at any time after the one-year anniversary date of their
original issue date until the sixth anniversary of the date such Warrant is
issued to Redmond, one share of the Common Stock for a purchase price per share
equal to 50% of the volume weighted average of the selling price of the Common
Stock of the Company on February 12, 2010 and for the 19 trading days prior to
February 12, 2010, or $1.98 per share, subject to anti-dilution protection and
adjustment of the warrant price and number of shares as provided in the Warrant
Certificate.”

    

    (b)  For
Advances made on or after February 19, 2010, the definitions “Advance Shares”
and “Drawdown Shares” shall each be deleted in their entirety.

    

    (c)  Section
6.2(c) of the Loan Agreement with respect to certain negative covenants shall be
deleted in its entirety.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    2.2  Amendment to Exhibit 1- Form
of 14% Subordinated Note.

    

    (a)  Section
2 of the Note is hereby amended and modified by deleting therefrom the
definition of “Maturity
Date” in its entirety and inserting the following new
definition:

    

    “’Maturity
Date’ means the earlier of:  (i) April 10, 2011, or (ii) the maturity
of the Existing Loans.”  

    

    (b)  Section
3 of the Note is hereby amended and modified by deleting therefrom the words
“April 10, 2010” and replacing with the words “April 10, 2011”.

    

    2.3  Amendment to Exhibit 2- Form
of Warrant Certificate.

     

    (a)  With
respect to any Warrant Certificate issued prior to February 19, 2010, each time
the words “April 10, 2015” appear, such words shall be deleted in their entirety
and replaced with the words “April 10, 2020”.

     

    (b)  For
any Warrant Certificate issued on or after February 19, 2010, each time the
words “April 10, 2015” appear, such words shall be deleted in their entirety and
be replaced with the words “the sixth anniversary date of the issuance of the
Warrant Certificate.”

    

    (c)  For
any Warrant Certificate issued to Redmond on or after February 19, 2010, the
words “$.64” in the first full paragraph of the Warrant Certificate shall be
deleted and replaced with the following:  “50% of the volume weighted
average selling price of the Common Stock of the Company on February 12, 2010
and for the 19 trading days prior to February 12, 2010, or $1.98 per
share.”

    

    (d)  For
any Warrant Certificate issue to Redmond on or after February 19, 2010, the
first sentence of Section 1 of the Warrant Certificate shall be deleted in its
entirety and replaced with the following:

    

    “The
Warrants were issued in connection with the issuance by the Company and its
subsidiaries (as co-obligors) of a 14% Subordinated Note due April 10, 2011,
(the “Subordinated
Note” and
pursuant to that certain loan agreement executed as of May 14, 2009, as amended
by the First Amendment to Loan Agreement dated February 19, 2010 (the “Loan
Agreement”) with Common Stock Purchase Warrants issued to the Registered Owner
(0.20 shares of Common Stock of the Company for each $1.00 of principal amount
of Subordinated Note on the date of each Borrowing).” 

    

    2.4  Amendment to Schedule 1 to
Loan Agreement.  With respect to Advances made on or after
February 19, 2010, Schedule 1 shall be deleted in its entirety and replaced with
the following:

     

    SCHEDULE
1

     

    
      
        
          
            
              
                
                  
                    	
                            Maximum

                            Availability

                          	 	
                            Warrants

                          
	$	500,000	 	
                            to
      purchase 0.20 shares of Common Stock for each $1.00 of principal amount of
      each
Borrowing.

                          

                  

                

              

            

          

        

      

    

     

    3.  Continuing Effect.
Except as expressly amended or waived hereby, the Loan Agreement and the other
Financing Documents shall continue to be and shall remain in full force and
effect in accordance with their respective terms. This Amendment shall not
constitute an amendment or waiver of any provision of the Loan Agreement or the
other Financing Documents not expressly referred to herein and shall not be
construed as an amendment, waiver or consent to any action on the part of the
Company that would require an amendment, waiver or consent of
Redmond.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    4.  Representations and
Warranties of the Company; Covenants of the Company.  The
Company represents and warrants that the representations and warranties
contained in the Loan Agreement are true and correct as of the date of this
Amendment.  The Company represents and warrants that the Company has
complied in all material respects with the covenants contained in the Loan
Agreement as of the date of this Amendment.

    

    5.  Counterparts.  The
parties to this Amendment may execute this Amendment in counterparts by manual
or facsimile signature.  Each executed counterpart of this Amendment
will constitute an original document, and all executed counterparts,
collectively, will constitute the same agreement.

    

    6.  Governing
Law.  The validity, construction, enforcement, and
interpretation of this Agreement are governed by the laws of the State of
Florida and the federal laws of the United States of America, excluding the laws
of those jurisdictions pertaining to the resolution of conflicts with laws of
other jurisdictions.

    

    7.  Headings.  Section
headings used in this Amendment are for convenience of reference only, are not
part of this Amendment and are not to affect the constructions of, or to be
taken into consideration in interpreting, this Amendment.

    

    [Signature
pages follow]

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
and delivered as of the date first above written.

    

    
      
        
          
            	 
      	
                    AEROSONIC
      CORPORATION

                  
	 
      	 
      	 
      
	 
      	
                    By:

                  	
                    /s/
      Douglas J. Hillman

                  
	 
      	 
      	
                    Douglas
      J. Hillman

                  
	 
      	 
      	
                    President
      and Chief Executive Officer

                  
	 
      	 
      	 
      
	 
      	
                    REDMOND
      FAMILY INVESTMENTS, LLLP

                  
	 
      	 
      	 
      
	 
      	
                    By:

                  	
                    /s/
      David L. Redmond

                  
	 
      	 
      	
                    David
      L. Redmond

                    Title:  General
      Partner

                  

          

        

      

    

     

    
      
         

      

      
        4

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