Document:

<PAGE>

                                                                    EXHIBIT 10.3

                               SECURITY AGREEMENT

                                                               September 1, 2004

                  THIS AGREEMENT is made among

                  Brown Brothers Harriman & Co., as Administrative Agent for the
         Lenders party to the Loan Agreement (defined herein) (the "AGENT") with
         offices at 40 Water Street, Boston, Massachusetts 02109;

                  and

                  Dynamics Research Corporation (the "LEAD BORROWER"), a
         Massachusetts corporation with its principal executive offices at 60
         Frontage Road, Andover, Massachusetts, as agent for itself;

                  DRC International Corporation ("INTERNATIONAL"), a
         Massachusetts corporation with its principal executive offices at 60
         Frontage Road, Andover, Massachusetts;

                  H.J. Ford Associates, Inc. ("H.J. FORD"), a Delaware
         corporation with its principal executive offices at 60 Frontage Road,
         Andover, Massachusetts;

                  Andrulis Corporation ("ANDRULIS"), a Delaware corporation with
         its principal executive offices at 60 Frontage Road, Andover,
         Massachusetts; and

                  Impact Innovations Group LLC ("IMPACT"), a Delaware limited
         liability company with its principal executive offices at 60 Frontage
         Road, Andover, Massachusetts.

                  (Each of the Lead Borrower, International, H.J. Ford,
         Andrulis, and Impact being sometimes hereinafter referred to
         individually as a "BORROWER" and collectively as the "BORROWERS").

                  In consideration of the mutual covenants contained herein and
         benefits to be derived herefrom, and other good and valuable
         consideration, the receipt and sufficiency of which are hereby
         acknowledged, the parties hereto agrees as follows:

1.       - DEFINITIONS:

                  As used herein, the following terms have the following
         meanings or are defined in the section of this Agreement so indicated.

         "ACCOUNT DEBTOR": Has the meaning given that term in the UCC.

         "ACCOUNTS" and "ACCOUNTS RECEIVABLE" include, without limitation,
                  "accounts" as defined in the UCC, and also all: accounts,
                  accounts receivable, receivables, and rights to payment
                  (whether or not earned by performance) for: property that has
                  been or is to be sold, leased, licensed, assigned, or
                  otherwise disposed of; services rendered or to be rendered; a
                  policy of insurance issued or to be issued; a secondary
                  obligation incurred or to be incurred; energy provided or to
                  be provided; for the use or hire of a vessel; arising out of
                  the use of a credit or charge card or information contained on
                  or used with that card; winnings in a lottery or other game of
                  chance; and also all Inventory which gave rise thereto, and
                  all rights associated with such Inventory, including the right
                  of stoppage in transit; all reclaimed, returned, rejected or
                  repossessed Inventory (if any) the sale of which gave rise to
                  any Account.

         "AGENT": Is referred to in the Preamble.

         "AGENT'S RIGHTS AND REMEDIES": Is defined in Section 5.f.

                                     - 1 -

<PAGE>

         "CHATTEL PAPER": Has the meaning given that term in the UCC.

         "COLLATERAL": Is defined in Section 2.a.

         "COLLATERAL INTEREST": Means any interest in property to secure an
                  obligation, including, without limitation, a security
                  interest, mortgage, and deed of trust.

         "CONTRACT RIGHTS": includes, without limitation, "contract rights" as
                  now or formerly defined in the UCC and also any right to
                  payment under a contract not yet earned by performance and not
                  evidenced by an instrument or Chattel Paper.

         "DEPOSIT ACCOUNT": Has the meaning given that term in the UCC and also
                  includes all demand, time, savings, passbook, or similar
                  accounts maintained with a bank.

         "DOCUMENTS": Has the meaning given that term in the UCC.

         "DOCUMENTS OF TITLE": Has the meaning given that term in the UCC.

         "ENCUMBRANCE": Each of the following:

                           (a)      A Collateral Interest or agreement to create
                  or grant a Collateral Interest; the interest of a lessor under
                  a Capital Lease; conditional sale or other title retention
                  agreement; sale of accounts receivable or chattel paper; or
                  other arrangement pursuant to which any Person is entitled to
                  any preference or priority with respect to the property or
                  assets of another Person or the income or profits of such
                  other Person; each of the foregoing whether consensual or
                  non-consensual and whether arising by way of agreement,
                  operation of law, legal process or otherwise.

                           (b)      The filing of any financing statement under
                  the UCC or comparable law of any jurisdiction.

         "EQUIPMENT": Includes, without limitation, "equipment" as defined in
                  the UCC, and also all furniture, store fixtures, motor
                  vehicles, rolling stock, machinery, office equipment, plant
                  equipment, tools, dies, molds, and other goods, property, and
                  assets which are used and/or were purchased for use in the
                  operation or furtherance of a Borrowers' business, and any and
                  all accessions or additions thereto, and substitutions
                  therefor.

         "EVENTS OF DEFAULT": Has the meaning given that term in the Loan
                  Agreement.

         "FIXTURES": Has the meaning given that term in the UCC.

         "GENERAL INTANGIBLES": Includes, without limitation, "general
                  intangibles" as defined in the UCC; and also all: rights to
                  payment for credit extended; deposits; amounts due to any
                  Borrower; credit memoranda in favor of any Borrower; warranty
                  claims; tax refunds and abatements; insurance refunds and
                  premium rebates; all means and vehicles of investment or
                  hedging, including, without limitation, options, warrants, and
                  futures contracts; records; customer lists; telephone numbers;
                  goodwill; causes of action; judgments; payments under any
                  settlement or other agreement; literary rights; rights to
                  performance; royalties; license and/or franchise fees; rights
                  of admission; licenses; franchises; license agreements,
                  including all rights of any Borrower to enforce same; permits,
                  certificates of convenience and necessity, and similar rights
                  granted by any governmental authority; patents, patent
                  applications, patents pending, and other intellectual
                  property; internet addresses and domain names; developmental
                  ideas and concepts; proprietary processes; blueprints,
                  drawings, designs, diagrams, plans, reports, and charts;
                  catalogs; manuals; technical data;

                                     - 2 -

<PAGE>

                  computer software programs (including the source and object
                  codes therefor), computer records, computer software, rights
                  of access to computer record service bureaus, service bureau
                  computer contracts, and computer data; tapes, disks,
                  semi-conductors chips and printouts; trade secrets rights,
                  copyrights, mask work rights and interests, and derivative
                  works and interests; user, technical reference, and other
                  manuals and materials; trade names, trademarks, service marks,
                  and all goodwill relating thereto; applications for
                  registration of the foregoing; and all other general
                  intangible property of any Borrower in the nature of
                  intellectual property; proposals; cost estimates, and
                  reproductions on paper, or otherwise, of any and all concepts
                  or ideas, and any matter related to, or connected with, the
                  design, development, manufacture, sale, marketing, leasing, or
                  use of any or all property produced, sold, or leased, by any
                  Borrower or credit extended or services performed, by any
                  Borrower, whether intended for an individual customer or the
                  general business of any Borrower, or used or useful in
                  connection with research by any Borrower.

         "GOODS": Has the meaning given that term in the UCC, and also includes
                  all things movable when a security interest therein attaches
                  and also all computer programs embedded in goods and any
                  supporting information provided in connection with a
                  transaction relating to the program if (i) the program is
                  associated with the goods in such manner that it customarily
                  is considered part of the goods or (ii) by becoming the owner
                  of the goods, a Person acquires a right to use the program in
                  connection with the goods.

         "INSTRUMENTS": Has the meaning given that term in the UCC.

         "INVENTORY": Includes, without limitation, "inventory" as defined in
                  the UCC and also all: (a) Goods which are leased by a Person
                  as lessor; are held by a Person for sale or lease or to be
                  furnished under a contract of service; are furnished by a
                  Person under a contract of service; or consist of raw
                  materials, work in process, or materials used or consumed in a
                  business; (b) Goods of said description in transit; (c) Goods
                  of said description which are returned, repossessed and
                  rejected; (d) packaging, advertising, and shipping materials
                  related to any of the foregoing; (e) all names, marks, and
                  General Intangibles affixed or to be affixed or associated
                  thereto; and (f) Documents and Documents of Title which
                  represent any of the foregoing.

         "INVESTMENT PROPERTY": Has the meaning given that term in the UCC.

         "LEASEHOLD INTEREST": Any interest of a Borrower as lessee under any
                  Lease.

         "LETTER-OF-CREDIT RIGHT": Has the meaning given that term in UCC and
                  also refers to any right to payment or performance under an
                  L/C, whether or not the beneficiary has demanded or is at the
                  time entitled to demand payment or performance.

         "LOAN AGREEMENT": The Second Amended and Restated Loan Agreement,
                  dated of even date herewith, by and among the Borrowers, the
                  Agent, various banks and other financial institutions named
                  therein as lenders and others, all as the same may be amended
                  from time to time hereafter. Terms used herein which are
                  defined in the Loan Agreement are used herein as so defined.
                  In the event that the Loan Agreement is ever terminated or the
                  definition of any term used herein is deleted from the Loan
                  Agreement, then unless otherwise agreed in writing, such term
                  used herein which had been defined in the Loan Agreement shall
                  continue to be used herein as then most recently defined in
                  the Loan Agreement.

         "PAYMENT INTANGIBLE": As defined in the UCC and also any general
                  intangible under which the Account Debtor's primary obligation
                  is a monetary obligation.

         "PERMITTED LIEN": Has the meaning given that term in the Loan
                  Agreement.

                                     - 3 -

<PAGE>

         "PERSON": Any natural person, and any corporation, limited liability
                  company, trust, partnership, joint venture, or other
                  enterprise or entity.

         "PERFECTION CERTIFICATE": Collectively, each Perfection Certificate
                  executed and delivered by each Borrower in connection with the
                  Loan Agreement.

         "PROCEEDS": Includes, without limitation, "Proceeds" as defined in the
                  UCC and each type of property described in Section 2.a hereof.

         "RECEIVABLES COLLATERAL": That portion of the Collateral which consists
                  of Accounts, Accounts Receivable, General Intangibles, Chattel
                  Paper, Instruments, Documents of Title, Documents, Investment
                  Property, Payment Intangibles, Letter-of-Credit Rights,
                  bankers' acceptances, and all other rights to payment.

         "REQUIREMENTS OF LAW": Has the meaning given that term in the Loan
                  Agreement.

         "SUPPORTING OBLIGATION": Has the meaning given that term in the UCC and
                  also refers to a Letter-of-Credit Right or secondary
                  obligation which supports the payment or performance of an
                  Account, Chattel Paper, a Document, a General Intangible, an
                  Instrument, or Investment Property.

         "UCC": The Uniform Commercial Code as adopted and in effect in the
                  Commonwealth of Massachusetts, as amended from time to time.

2.       - GRANT OF SECURITY INTEREST:

         a.       GRANT OF SECURITY INTEREST. To secure the Borrowers' prompt,
                  punctual, and faithful performance of all and each of the
                  Liabilities, each Borrower hereby grants to the Agent, for the
                  ratable benefit of the Lenders, a continuing security interest
                  in and to, and assigns to the Agent, for the ratable benefit
                  of the Lenders, the following, and each item thereof, whether
                  now owned or now due, or in which that Borrower has an
                  interest, or hereafter acquired, arising, or to become due, or
                  in which that Borrower obtains an interest, and all products,
                  Proceeds, substitutions, and accessions of or to any of the
                  following (all of which, together with any other property in
                  which the Agent may in the future be granted a security
                  interest, is referred to herein as the "COLLATERAL"):

                  i.       All Accounts and accounts receivable.

                  ii.      All Inventory.

                  iii.     All General Intangibles.

                  iv.      All Equipment.

                  v.       All Goods.

                  vi.      All Fixtures.

                  vii.     All Chattel Paper.

                  viii.    All Letter-of-Credit Rights.

                  ix.      All Payment Intangibles.

                  x.       All Supporting Obligations.

                  xi.      All books, records, and information relating to the
                           Collateral and/or to the operation of each Borrowers'
                           business, and all rights of access to such books,
                           records, and information, and all property in which
                           such books, records, and information are stored,
                           recorded, and maintained.

                                     - 4 -

<PAGE>

                  xii.     All Leasehold Interests.

                  xiii.    All Investment Property, Instruments, Documents,
                           Deposit Accounts, money, policies and certificates of
                           insurance, deposits, impressed accounts, compensating
                           balances, cash, or other property.

                  xiv.     All insurance proceeds, refunds, and premium rebates,
                           including, without limitation, proceeds of fire and
                           credit insurance, whether any of such proceeds,
                           refunds, and premium rebates arise out of any of the
                           foregoing. ( through ) or otherwise.

                  xv.      All liens, guaranties, rights, remedies, and
                           privileges pertaining to any of the foregoing (
                           through ), including the right of stoppage in
                           transit.

provided, however, the term "Collateral" shall not include (i) any property for
which the grant of a security interest therein is prohibited by any applicable
Requirement of Law of any governmental authority; or (ii) any contract, license
or agreement which contains a provision that (A) prohibits the grant of a
security interest therein; or (B) provides a default may or shall occur
thereunder as a result of the grant of a security interest therein, unless any
required consents shall have been obtained.

         b.       COMMERCIAL TORT CLAIMS. If the Borrowers shall at any time,
                  acquire a commercial tort claim, the Borrowers shall promptly
                  notify the Agent in a writing signed by the applicable
                  Borrower of the brief details thereof and grant to the Agent,
                  for the ratable benefit of the Lenders, in such writing a
                  security interest therein and in the proceeds thereof, all
                  upon the terms of this Agreement, with such writing to be in
                  form and substance satisfactory to the Lenders.

         c.       EXTENT AND DURATION OF SECURITY INTEREST.

                  i.       The security interest created and granted herein is
                           in addition to, and supplemental of, any security
                           interest previously granted by any Borrower to the
                           Agent, if any, and shall continue in full force and
                           effect applicable to all Liabilities until both

                           a)       all Liabilities have been paid and/or
                                    satisfied in full; and

                           b)       the security interest created herein is
                                    specifically terminated in writing by a duly
                                    authorized officer of the Agent.

                  ii.      It is intended that the Collateral Interests created
                           herein extend to and cover all assets of each
                           Borrower.

                  iii.     Once all Liabilities have been paid and/or satisfied
                           in full and there is no further obligation on any
                           Lender to make any further financial accommodations
                           to or for the benefit of any Borrower, the Agent
                           agrees to release the Collateral from the security
                           interest and file, at the Borrowers' cost and
                           expense, such termination statements as may be
                           necessary or appropriate.

                  iv.      Notwithstanding any provision contained in this
                           Agreement to the contrary, upon the occurrence of any
                           Collateral Release Event (as defined in the Loan
                           Agreement), this Agreement and the security interest
                           granted to the Agent hereunder shall immediately and
                           automatically terminate and have no further force or
                           effect.

3.       - GENERAL REPRESENTATIONS, COVENANTS AND WARRANTIES:

                  As a further inducement to the Agent and each Lender, each
         Borrower, in addition to all other representations, warranties, and
         covenants made by any Borrower in any other Loan Document, make those
         representations, warranties, and covenants included in this Agreement.

         a.       ENCUMBRANCES.

                                     - 5 -

<PAGE>

                  i.       The Borrowers are, and shall hereafter remain, the
                           owners of the Collateral free and clear of all
                           Encumbrances other than any Permitted Liens.

                  ii.      No Borrower has, and none shall have, possession of
                           any property on consignment to that Borrower.

                  iii.     No Borrower shall acquire or obtain the right to use
                           any Equipment, the acquisition or right to use of
                           which Equipment is otherwise permitted by this
                           Agreement, in which Equipment any third party has an
                           interest, except for:

                           a)       Equipment which is merely incidental to the
                                    conduct of that Borrowers' business.

                           b)       Equipment, the acquisition or right to use
                                    of which has been consented to by the Agent,
                                    which consent may be conditioned upon the
                                    Agent's receipt of such agreement with the
                                    third party which has an interest in such
                                    Equipment as is satisfactory to the Agent.

         b.       FURTHER ASSURANCES.

                  i.       All names under which each Borrower conducted its
                           business within the last five (5) years are set forth
                           in each Borrower's respective Perfection Certificate.

                  ii.      All Persons with whom any Borrower ever consolidated
                           or merged, or from whom any Borrower ever acquired in
                           a single transaction or in a series of related
                           transactions substantially all of such Person's
                           assets are set forth in each Borrower's respective
                           Perfection Certificate.

                  iii.     Except as provided for in the Loan Agreement, no
                           Borrower will undertake or commit to undertake any
                           action such that the results of that action, if
                           undertaken prior to the date of this Agreement, would
                           have been reflected on any of the Borrower's
                           respective Perfection Certificate.

                  iv.      No Borrower is the owner of, nor has it any interest
                           in, Collateral which is not subject to a perfected
                           Collateral Interest in favor of the Agent (subject
                           only to Permitted Liens) to secure the Liabilities.

                  v.       No Borrower will hereafter acquire any asset or any
                           interest in property which is not, immediately upon
                           such acquisition, subject to such a perfected
                           Collateral Interest in favor of the Agent to secure
                           the Liabilities (subject only to Permitted Liens).

                  vi.      Each Borrower shall execute and deliver to the Agent
                           such instruments, documents, and papers, and shall do
                           all such things from time to time hereafter as the
                           Agent may reasonably request to carry into effect the
                           provisions and intent of this Agreement; to protect
                           and perfect the Agent's Collateral Interests in the
                           Collateral; and to comply with all applicable
                           statutes and laws, and facilitate the collection of
                           the Receivables Collateral. Each Borrower shall
                           execute all such instruments as may be reasonably
                           required by the Agent with respect to the recordation
                           and/or perfection of the Collateral Interests created
                           or contemplated herein.

                  vii.     Each Borrower hereby authorizes the Agent to file
                           financing statements, without notice to the
                           Borrowers, with all appropriate jurisdictions in
                           order to perfect or protect the Agent's and Lender's
                           interest or rights hereunder, which financing
                           statements may indicate the Collateral as "all assets
                           of the Debtor" or words of similar effect, or as
                           being of an equal or lesser scope, or with greater
                           detail, all in Lender's discretion.

                  viii.    This Agreement constitutes an authenticated record
                           which authorizes the Agent to file such financing
                           statements as the Agent determines as appropriate to
                           perfect or protect the Collateral Interests created
                           by this Agreement.

                                     - 6 -

<PAGE>

                  ix.      A carbon, photographic, or other reproduction of this
                           Agreement or of any financing statement or other
                           instrument executed pursuant to this Section b shall
                           be sufficient for filing to perfect the security
                           interests granted herein.

4.       - AGENT AS BORROWERS' ATTORNEY-IN-FACT:

         a.       APPOINTMENT AS ATTORNEY-IN-FACT. Each Borrower hereby
                  irrevocably constitutes and appoints the Agent (acting through
                  any officer of the Agent) as that Borrowers' true and lawful
                  attorney, with full power of substitution, exercisable
                  following the occurrence and continuance of any Event of
                  Default, to convert the Collateral into cash at the sole risk,
                  cost, and expense of that Borrower, but for the sole benefit
                  of the Agent and the Lenders. The rights and powers granted
                  the Agent by this appointment include but are not limited to
                  the right and power to:

                  i.       Prosecute, defend, compromise, or release any action
                           relating to the Collateral.

                  ii.      Sign change of address forms to change the address to
                           which each Borrowers' mail is to be sent to such
                           address as the Agent shall designate; receive and
                           open each Borrowers' mail; remove any Receivables
                           Collateral and Proceeds of Collateral therefrom and
                           turn over the balance of such mail either to the Lead
                           Borrower or to any trustee in bankruptcy or receiver
                           of the Lead Borrower, or other legal representative
                           of a Borrower whom the Agent determines to be the
                           appropriate person to whom to so turn over such mail.

                  iii.     Endorse the name of the relevant Borrower in favor of
                           the Agent upon any and all checks, drafts, notes,
                           acceptances, or other items or instruments; sign and
                           endorse the name of the relevant Borrower on, and
                           receive as secured party, any of the Collateral, any
                           invoices, schedules of Collateral, freight or express
                           receipts, or bills of lading, storage receipts,
                           warehouse receipts, or other documents of title
                           respectively relating to the Collateral.

                  iv.      Sign the name of the relevant Borrower on any notice
                           to that Borrowers' Account Debtors or verification of
                           the Receivables Collateral; sign the relevant
                           Borrowers' name on any Proof of Claim in Bankruptcy
                           against Account Debtors, and on notices of lien,
                           claims of mechanic's liens, or assignments or
                           releases of mechanic's liens securing the Accounts.

                  v.       Take all such action as may be necessary to obtain
                           the payment of any letter of credit and/or banker's
                           acceptance of which any Borrower is a beneficiary.

                  vi.      Repair, manufacture, assemble, complete, package,
                           deliver, alter or supply goods, if any, necessary to
                           fulfill in whole or in part the purchase order of any
                           customer of each Borrower.

                  vii.     Use, license or transfer any or all General
                           Intangibles of each Borrower.

         b.       NO OBLIGATION TO ACT. The Agent shall not be obligated to do
                  any of the acts or to exercise any of the powers authorized by
                  Section a herein, but if the Agent elects to do any such act
                  or to exercise any of such powers, it shall not be accountable
                  for more than it actually receives as a result of such
                  exercise of power, and shall not be responsible to any
                  Borrower for any act or omission to act except for any act or
                  omission to act as to which there is a final determination
                  made in a judicial proceeding (in which proceeding the Agent
                  has had an opportunity to be heard) which determination
                  includes a specific finding that the subject act or omission
                  to act had been grossly negligent or in actual bad faith.

5.       - EVENTS OF DEFAULT. RIGHTS AND REMEDIES UPON DEFAULT:

         a.       RIGHTS OF ENFORCEMENT. Upon and following the occurrence of
                  any Event of Default which consists of the entry of an order
                  for relief with respect to any Borrower and, at the option of
                  the Agent, upon the occurrence and during continuance of any
                  other Event of Default and at all times thereafter, the Agent
                  shall have all of the rights and remedies of a secured party
                  upon default under

                                     - 7 -

<PAGE>

                  the UCC, in addition to which the Agent shall have all and
                  each of the following rights and remedies:

                  i.       To give notice to any of the Borrowers' customs
                           brokers to follow the instructions of the Agent as
                           provided in any written agreement or undertaking of
                           such broker in favor of the Agent.

                  ii.      To collect the Receivables Collateral with or without
                           the taking of possession of any of the Collateral.

                  iii.     To take possession of all or any portion of the
                           Collateral.

                  iv.      To sell, lease, or otherwise dispose of any or all of
                           the Collateral, in its then condition or following
                           such preparation or processing as the Agent deems
                           advisable and with or without the taking of
                           possession of any of the Collateral.

                  v.       To apply the Receivables Collateral or the Proceeds
                           of the Collateral towards (but not necessarily in
                           complete satisfaction of) the Liabilities.

                  vi.      To exercise all or any of the rights, remedies,
                           powers, privileges, and discretions under all or any
                           of the Loan Documents.

         B.       SALE OF COLLATERAL. Upon the occurrence and during continuance
                  of any other Event of Default, and subject to applicable law,

                  i.       Any sale or other disposition of the Collateral may
                           be at public or private sale upon such terms and in
                           such manner as the Agent deems advisable, having due
                           regard to compliance with any statute or regulation
                           which might affect, limit, or apply to the Agent's
                           disposition of the Collateral.

                  ii.      Unless the Collateral is perishable or threatens to
                           decline speedily in value, or is of a type
                           customarily sold on a recognized market (in which
                           event the Agent shall provide the Lead Borrower such
                           notice as may be practicable under the
                           circumstances), the Agent shall give the Lead
                           Borrower at least ten (10) days prior notice, by
                           authenticated record, of the date, time, and place of
                           any proposed public sale, and of the date after which
                           any private sale or other disposition of the
                           Collateral may be made. Each Borrower agrees that
                           such written notice shall satisfy all requirements
                           for notice to that Borrower which are imposed under
                           the UCC or other applicable law with respect to the
                           exercise of the Agent's rights and remedies upon
                           default.

                  iii.     The Agent and any Lender may purchase the Collateral,
                           or any portion of it at any sale held under this
                           Article.

                  iv.      If any of the Collateral is sold, leased, or
                           otherwise disposed of by the Agent on credit, the
                           Liabilities shall not be deemed to have been reduced
                           as a result thereof unless and until payment is
                           finally received thereon by the Agent.

                  v.       The Agent shall apply the proceeds of the Agent's
                           exercise of its rights and remedies upon default
                           pursuant to this Article 5.

         c.       OCCUPATION OF BUSINESS LOCATION. In connection with the
                  Agent's exercise of the Agent's rights under this Article 5,
                  the Agent may, at any time after an Event of Default has
                  occurred and is continuing, enter upon, occupy, and use any
                  premises owned or occupied by each Borrower, and may exclude
                  each Borrower from such premises or portion thereof as may
                  have been so entered upon, occupied, or used by the Agent. The
                  Agent shall not be required to remove any of the Collateral
                  from any such premises upon the Agent's taking possession
                  thereof, and may render any Collateral unusable to the
                  Borrowers. In no event shall the Agent be liable to any
                  Borrower for use or occupancy by the Agent of any premises
                  pursuant to this Article 5, nor for any charge (such as wages
                  for any Borrowers' employees and utilities) incurred in
                  connection with the Agent's exercise of the Agent's Rights and
                  Remedies.

                                     - 8 -

<PAGE>

         d.       GRANT OF NONEXCLUSIVE LICENSE. Each Borrower hereby grants to
                  the Agent a royalty free nonexclusive irrevocable license to
                  use, apply, and affix any trademark, trade name, logo, or the
                  like in which any Borrower now or hereafter has rights, such
                  license being with respect to the Agent's exercise of the
                  rights hereunder including, without limitation, in connection
                  with any completion of the manufacture of Inventory or sale or
                  other disposition of Inventory.

         e.       ASSEMBLY OF COLLATERAL. At any time after an Event of Default
                  has occurred and is continuing, the Agent may require any
                  Borrower to assemble the Collateral and make it available to
                  the Agent at the Borrowers' sole risk and expense at a place
                  or places which are reasonably convenient to both the Agent
                  and the Lead Borrower.

         f.       RIGHTS AND REMEDIES. The rights, remedies, powers, privileges,
                  and discretions of the Agent hereunder (the "AGENT'S RIGHTS
                  AND REMEDIES") shall be cumulative and not exclusive of any
                  rights or remedies which it would otherwise have. No delay or
                  omission by the Agent in exercising or enforcing any of the
                  Agent's Rights and Remedies shall operate as, or constitute, a
                  waiver thereof. No waiver by the Agent of any Event of Default
                  or of any default under any other agreement shall operate as a
                  waiver of any other default hereunder or under any other
                  agreement. No single or partial exercise of any of the Agent's
                  Rights or Remedies, and no express or implied agreement or
                  transaction of whatever nature entered into between the Agent
                  and any person, at any time, shall preclude the other or
                  further exercise of the Agent's Rights and Remedies. No waiver
                  by the Agent of any of the Agent's Rights and Remedies on any
                  one occasion shall be deemed a waiver on any subsequent
                  occasion, nor shall it be deemed a continuing waiver. The
                  Agent's Rights and Remedies may be exercised at such time or
                  times and in such order of preference as the Agent may
                  determine. The Agent's Rights and Remedies may be exercised
                  without resort or regard to any other source of satisfaction
                  of the Liabilities.

6.       - GENERAL:

         a.       NOTICES. All notices, demands, and other communications made
                  in respect of this Agreement shall be as provided in the Loan
                  Agreement.

         b.       PROTECTION OF COLLATERAL. The Agent has no duty as to the
                  collection or protection of the Collateral beyond the safe
                  custody of such of the Collateral as may come into the
                  possession of the Agent.

         c.       SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
                  the Borrowers and their respective representatives,
                  successors, and assigns and shall enure to the benefit of the
                  Agent and each Lender and their respective successors and
                  assigns. In the event that the Agent or any Lender assigns or
                  transfers its rights under this Agreement, the assignee shall
                  thereupon succeed to and become vested with all rights,
                  powers, privileges, and duties of such assignor hereunder and
                  such assignor shall thereupon be discharged and relieved from
                  its duties and obligations hereunder.

         d.       SEVERABILITY. Any determination that any provision of this
                  Agreement or any application thereof is invalid, illegal, or
                  unenforceable in any respect in any instance or with respect
                  to any Borrower, shall not affect the validity, legality, or
                  enforceability of such provision in any other instance, or
                  with respect to any other Borrower, or the validity, legality,
                  or enforceability of any other provision of this Agreement.

         e.       POWER OF ATTORNEY. In connection with all powers of attorney
                  included in this Agreement, each Borrower hereby grants unto
                  the Agent (acting through any of its officers), exercisable
                  upon the occurrence and during the continuance of any Event of
                  Default, full power to do any and all things necessary or
                  appropriate in connection with the exercise of such powers as
                  fully and effectually as that Borrower might or could do,
                  hereby ratifying all that said attorney shall do or cause to
                  be done by virtue of this Agreement. No power of attorney set
                  forth in this Agreement shall be affected by any disability or
                  incapacity suffered by any Borrower and each shall survive the
                  same. All powers conferred upon the Agent by this Agreement,
                  being coupled with an interest,

                                     - 9 -

<PAGE>

                  shall be irrevocable until this Agreement is terminated by a
                  written instrument executed by a duly authorized officer of
                  the Agent.

         f.       APPLICATION OF PROCEEDS. The proceeds of any collection, sale,
                  or disposition of the Collateral, or of any other payments
                  received hereunder, shall be applied towards the Liabilities
                  in such order and manner as provided for in the Loan
                  Agreement. The Borrowers shall remain liable for any
                  deficiency remaining following such application.

         g.       INTENT. It is intended that:

                  i.       This Agreement take effect as a sealed instrument.

                  ii.      The scope of all Collateral Interests created by this
                           Agreement be broadly construed in favor of the Agent
                           and that they cover all assets of each Borrower.

                  iii.     All Collateral Interests created by this Agreement
                           secure all Liabilities, whether now existing or
                           contemplated or hereafter arising.

                  iv.      All reasonable costs, expenses, and disbursements
                           incurred by the Agent in connection with such
                           Person's relationship(s) with any Borrower shall be
                           borne by the Borrowers.

         h.       MASSACHUSETTS LAW. This Agreement and all rights and
                  obligations hereunder, including matters of construction,
                  validity, and performance, shall be governed by the law of The
                  Commonwealth of Massachusetts.

         i. CONSENT TO JURISDICTION.

                  i.       Each Borrower agrees that any legal action,
                           proceeding, case, or controversy against any Borrower
                           with respect to any Loan Document may be brought in
                           the Superior Court of Suffolk County Massachusetts or
                           in the United States District Court, District of
                           Massachusetts, sitting in Boston, Massachusetts, as
                           the Agent may elect in the Agent's sole discretion.
                           By execution and delivery of this Agreement, each
                           Borrower, for itself and in respect of its property,
                           accepts, submits, and consents generally and
                           unconditionally, to the jurisdiction of the aforesaid
                           courts.

                  ii.      Each Borrower WAIVES personal service of any and all
                           process upon it, and irrevocably consents to the
                           service of process out of any of the aforementioned
                           courts in any such action or proceeding by the
                           mailing of copies thereof by certified mail, postage
                           prepaid, to the Lead Borrower at the Lead Borrower's
                           address for notices as specified herein, such service
                           to become effective five (5) Business Days after such
                           mailing.

                  iii.     Each Borrower WAIVES any objection based on forum non
                           conveniens and any objection to venue of any action
                           or proceeding instituted under any of the Loan
                           Documents and consents to the granting of such legal
                           or equitable remedy as is deemed appropriate by the
                           Court.

                  iv.      Nothing herein shall affect the right of the Agent to
                           bring legal actions or proceedings in any other
                           competent jurisdiction.

                  v.       Each Borrower agrees that any action commenced by any
                           Borrower asserting any claim arising under or in
                           connection with this Agreement or any other Loan
                           Document shall be brought solely in the Superior
                           Court of Suffolk County Massachusetts or in the
                           United States District Court, District of
                           Massachusetts, sitting in Boston, Massachusetts, and
                           that such Courts shall have exclusive jurisdiction
                           with respect to any such action.

                  {REMAINDER OF PAGE LEFT INTENTIONALLY BLANK}

                                     - 10 -

<PAGE>

                  EXECUTED under seal as of the date first written above.

                                            DYNAMICS RESEARCH CORPORATION

                                            By:_________________________________
                                            Name:_______________________________
                                            Title:______________________________

                                            DRC INTERNATIONAL CORPORATION

                                            By:_________________________________
                                            Name:_______________________________
                                            Title:______________________________

                                            H.J. FORD ASSOCIATES, INC.

                                            By:_________________________________
                                            Name:_______________________________
                                            Title:______________________________

                                            ANDRULIS CORPORATION

                                            By:_________________________________
                                            Name:_______________________________
                                            Title:______________________________

                                            IMPACT INNOVATIONS GROUP LLC

                                            By:_________________________________
                                            Name:_______________________________
                                            Title:______________________________

                                     - 11 -

<PAGE>

                                            BROWN BROTHERS HARRIMAN & CO.

                                            By:_________________________________
                                            Name:_______________________________
                                            Title:______________________________

                                     - 12 -<PAGE>

                                                                    EXHIBIT 10.4

                                PLEDGE AGREEMENT

         THIS PLEDGE AGREEMENT (this "AGREEMENT") is dated as of the 1st day of
September, 2004 by and between DYNAMICS RESEARCH CORPORATION, a Massachusetts
corporation (the "PLEDGOR"), and BROWN BROTHERS HARRIMAN & CO., a New York
general partnership with offices at 40 Water Street, Boston, Massachusetts, for
itself and as Administrative Agent for each of the Lenders (defined below) which
are and which may become parties to the Loan Agreement (defined below) (the
"SECURED PARTY"). The Secured Party, in its capacity as Agent for the Lenders
hereunder, is sometimes hereinafter referred to as the "AGENT", which term shall
also be deemed to include any other party acting as agent for the Lenders
hereunder.

                              Preliminary Statement

         WHEREAS, the Pledgor and certain of its affiliates (such affiliates,
together with the Pledgor, being referred to herein singly as a "BORROWER" or
collectively, the "BORROWERS") and the Agent, Banknorth, N.A., as Documentation
Agent, KeyBank National Association, as Co-Syndication Agent, and Fleet National
Bank, a Bank of America company, as Co-Syndication Agent (collectively, the
"LENDERS" and each a "LENDER") have entered into that certain Second Amended and
Restated Loan Agreement of even date herewith (as amended, modified, extended
and/or supplemented from time to time, the "LOAN AGREEMENT"; capitalized terms
used but not defined herein shall have the meanings given to such terms in the
Loan Agreement) pursuant to which the Lenders have agreed, subject to the terms
and conditions set forth therein, to make certain loans to the Borrowers
(collectively, the "LOANS"); such Loans are evidenced by the Borrowers'
Revolving Credit Notes, Term Notes, and Acquisition Term Notes of even date
herewith payable to the Lenders (as such Notes may be amended, modified,
supplemented and/or extended from time to time, singly and collectively, the
"NOTE"); and

         WHEREAS, the obligation of the Agent and the Lenders to enter into the
Loan Agreement and make the Loans described therein is subject to the
conditions, among others, that the Pledgor shall execute and deliver this
Agreement and grant to the Secured Party the pledge and security interest
hereinafter described;

         NOW, THEREFORE, in consideration of the willingness of the Secured
Party and the Lenders to enter into the Loan Agreement and, subject to the terms
and conditions set forth therein, to make Loans to the Borrowers pursuant to the
Loan Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, it is hereby agreed as follows:

         1.       Security Interest. The Pledgor hereby deposits with and
pledges to the Secured Party, for the benefit of the Lenders, the shares of
capital stock (the "PLEDGED STOCK") listed in Schedule I attached hereto. The
Pledgor hereby pledges to the Secured Party, for the benefit of the Lenders, any
and all promissory notes in excess of $250,000.00 made payable to the Pledgor
(each, a "PLEDGED NOTE", and collectively, with the Pledged Stock and any
additional securities or collateral now or hereafter pledged hereunder, the
"PLEDGED COLLATERAL"). The Pledgor hereby grants to the Secured Party, for the
benefit of the Lenders, a security interest in and lien on all of the Pledged
Collateral as security for the due and punctual payment and performance of the
Secured Obligations described in Section 2 hereof. Simultaneously with the
execution of this Agreement, the Pledgor shall deliver to the Secured Party the

                                     - 1 -

<PAGE>

original certificates evidencing the Pledged Stock and executed Stock Powers.
Notwithstanding any provision contained in this Agreement to the contrary, upon
the occurrence of any Collateral Release Event, this Agreement and the security
interest granted hereunder shall immediately and automatically terminate and
have no further force or effect.

         2.       Secured Obligations. The security interest hereby granted
shall secure the due and punctual payment and performance of the Liabilities (as
defined in the Loan Agreement) of the Pledgor (herein called the "SECURED
OBLIGATIONS").

         3.       Special Warranties and Covenants of the Pledgor. The Pledgor
hereby warrants and covenants to the Secured Party and each Lender that:

         a.       The Pledged Collateral is duly and validly pledged with the
                  Secured Party, for the benefit of the Lenders, in accordance
                  with law and the Pledgor warrants and will defend the Secured
                  Party's right, title and security interest in and to the
                  Pledged Collateral against the claims and demands of all
                  persons whomsoever.

         b.       The Pledgor has good title to the Pledged Collateral, free and
                  clear of all claims, mortgages, pledges, liens, security
                  interests and other encumbrances of every nature whatsoever
                  except as may be expressly set forth and permitted under the
                  Loan Agreement.

         c.       To the knowledge of the Pledgor, all of the Pledged Stock has
                  been duly and validly issued and is fully paid and
                  nonassessable.

         d.       The Pledged Stock includes all of the presently issued and
                  outstanding capital stock of each subsidiary of the Pledgor.

         e.       If Pledgor acquires any additional shares of capital stock
                  (including, without limitation, from the issuance of any
                  additional shares of capital stock of any subsidiary of the
                  Pledgor) or any other investment property or securities,
                  and/or if the Pledgor becomes the payee on any promissory note
                  or other instrument, after the date hereof, the same shall
                  constitute Pledged Collateral and shall be deposited and
                  pledged with the Secured Party, for the benefit of the
                  Lenders, as provided in Section 1 hereof simultaneously with
                  such acquisition.

         f.       So long as the Collateral Release Event has not occurred, in
                  the event that the Pledgor obtains a promissory note which
                  would constitute a Pledged Note hereunder, the Pledgor shall
                  promptly deliver such Pledged Note to the Administrative Agent
                  with such endorsements as the Administrative Agent shall
                  reasonably require.

         g.       The Pledgor will not sell, convey or otherwise dispose of any
                  of the Pledged Collateral except to the extent permitted in
                  the Loan Agreement, nor will the Pledgor create, incur or
                  permit to exist any pledge, mortgage, lien, charge,
                  encumbrance or any security interest whatsoever with respect
                  to any of the Pledged Collateral or the proceeds thereof,
                  other than liens on and security interests in the Pledged
                  Collateral created hereby or which are otherwise expressly
                  permitted under the Loan Agreement.

                                     - 2 -

<PAGE>

         h.       The statements contained in the Preliminary Statement of this
                  Agreement are true and correct.

         4.       Distributions. Upon the dissolution, winding up, liquidation
or reorganization of any company whose capital stock or notes are included in
the Pledged Collateral, whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors or any other
marshaling of the assets and liabilities of any such company or otherwise, if
any sum shall be paid or any property shall be distributed upon or with respect
to any of the Pledged Collateral and an Event of Default shall have occurred and
be continuing, then such sum shall be paid over to the Secured Party to be held
as collateral security for the Secured Obligations. In case any stock dividend
shall be declared on any of the Pledged Collateral, or any share of stock or
fraction thereof shall be issued pursuant to any stock split involving any of
the Pledged Collateral, or any distribution of capital (including cash
dividends) shall be made on any of the Pledged Collateral, or any property shall
be distributed upon or with respect to the Pledged Collateral pursuant to a
recapitalization or reclassification, the shares or other property so
distributed shall be delivered to the Secured Party to be held as collateral
security for the Secured Obligations.

         5.       [Reserved].

         6.       Rights and Remedies of Secured Party. Upon the occurrence and
continuance of any Event of Default, such default not having previously been
remedied or cured within any applicable grace or cure periods, the Secured Party
shall have the following rights and remedies:

         a.       All rights and remedies provided by law, including, without
                  limitation, those provided by the Massachusetts Uniform
                  Commercial Code;

         b.       All rights and remedies provided in this Agreement; and

         c.       All rights and remedies provided in the Loan Agreement, the
                  Note, or in any other Loan Document, and any other agreement,
                  document or instrument pertaining to the Secured Obligations.

         7.       Right to Transfer into Name of Secured Party, etc. In case
there shall exist an Event of Default that shall be continuing after applicable
grace and cure periods, but subject to the provisions of the Uniform Commercial
Code or other applicable law, the Secured Party may cause all or any of the
Pledged Collateral to be transferred into its name or into the name of its
nominee or nominees. So long as no Event of Default shall exist and be
continuing, the Pledgor shall be entitled to exercise as the Pledgor shall deem
fit, but in a manner not inconsistent with the terms hereof or of the Secured
Obligations, the voting power with respect to the Pledged Collateral.

         8.       Right of Secured Party to Exercise Voting Power, etc. In case
there shall exist an Event of Default, which shall not have been remedied or
cured, the Secured Party, until such Event of Default has been remedied or cured
in accordance with the Loan Agreement, shall be entitled to exercise the voting
power with respect to the Pledged Collateral, to receive and retain, as
collateral security for the Secured Obligations any and all dividends or other
distributions at any time and from time to time declared or made upon any of the
Pledged Collateral, and to exercise any and all rights of payment, conversion,
exchange, subscription or any other rights, privileges or options pertaining to
the Pledged

                                     - 3 -

<PAGE>

Collateral as if it were the absolute owner thereof, including, without
limitation, the right to exchange, at its discretion, any and all of the
Pledged Collateral upon the merger, consolidation, reorganization,
recapitalization or other readjustment of the Pledgor or, upon the exercise of
any such right, privilege or option pertaining to the Pledged Collateral, and
in connection therewith, to deposit and deliver any and all of the Pledged
Collateral with any committee, depositary, transfer agent, registrar or other
designated agency upon such terms and conditions as the Secured Party may
determine, all without liability except to account for property actually
received, but the Secured Party shall have no duty to exercise any of the
aforesaid rights, privileges or options and shall not be responsible for any
failure to do so or delay in so doing.

         9.       Right of Secured Party to Dispose of Collateral, etc. Upon the
occurrence and during the continuance of an Event of Default, such Event of
Default not having previously been remedied or cured within any applicable grace
or cure periods, the Secured Party shall have the right, unless the Event of
Default shall have been remedied or cured in accordance with the Loan Agreement
prior to taking any such actions, at any time or times thereafter to sell,
resell, assign and deliver all or any of the Pledged Collateral in one or more
parcels at any exchange or broker's board or at public or private sale. The
Secured Party will give the Pledgor at least ten (10) days' prior written notice
in accordance with Section 17 hereof of the time and place of any public sale
thereof or of the time after which any private sale or any other intended
disposition thereof is to be made. Any such notice shall be deemed to meet any
requirement hereunder or under any applicable law (including the Uniform
Commercial Code) that reasonable notification be given of the time and place of
such sale or other disposition. Such notice may be given without any demand of
performance or other demand, all such demands being hereby expressly waived by
the Pledgor. All such sales shall be conducted in a commercially reasonable
manner and shall be at such commercially reasonable price or prices as the
Secured Party shall deem best and either for cash or on credit or for future
delivery (without assuming any responsibility for credit risk). At any such sale
or sales the Secured Party may purchase any or all of the Pledged Collateral to
be sold thereat upon such terms as the Secured Party may deem best. Upon any
such sale or sales the Pledged Collateral so purchased shall be held by the
purchaser absolutely free from any claims or rights of whatsoever kind or
nature, including any equity of redemption and any similar rights, all such
equity of redemption and any similar rights being hereby expressly waived and
released by the Pledgor. In the event any consent, approval or authorization of
any governmental agency will be necessary to effectuate any such sale or sales,
the Pledgor shall execute, and hereby agree to cause the Pledgor to execute, all
such applications or other instruments as may be required. The proceeds of any
such sale or sales, together with any other additional collateral security at
the time received and held hereunder, shall be received and applied pursuant to
Section 13-3 of the Loan Agreement.

         The Pledgor recognizes that the Secured Party may be unable to effect a
public sale of all or a part of the Pledged Collateral by reason of certain
prohibitions contained in the Securities Act of 1933, but may be compelled to
resort to one or more private sales to a restricted group of purchasers, each of
whom will be obligated to agree, among other things, to acquire such Pledged
Collateral for its own account, for investment and not with a view to the
distribution or resale thereof. The Pledgor acknowledges that private sales so
made may be at prices and upon other terms less favorable to the seller than if
such Pledged Collateral were sold at public sales, and that the Secured Party
has no obligation to delay sale of any such Pledged Collateral for the period of
time necessary to permit such Pledged Collateral to be registered for public
sale under the Securities Act of 1933. The Pledgor agrees that any

                                     - 4 -

<PAGE>

such private sales shall not be deemed to have been made in a commercially
unreasonable manner solely because they shall have been made under the
foregoing circumstances.

         10.      Collection of Amounts Payable on Account of Pledged
Collateral, etc. Upon the occurrence and during the continuance of any Event of
Default, the Secured Party may, but without obligation to do so, demand, sue for
and/or collect any money or property at any time due, payable or receivable, to
which it may be entitled hereunder, on account of or in exchange for any of the
Pledged Collateral and shall have the right, for and in the name, place and
stead of the Pledgor, to execute endorsements, assignments or other instruments
of conveyance or transfer with respect to all or any of the Pledged Collateral.

         11.      Care of Pledged Collateral in Secured Party's Possession.
Beyond the exercise of reasonable care to assure the safe custody of the Pledged
Collateral while held hereunder, the Secured Party shall have no duty or
liability to collect any sums due in respect thereof or to protect or preserve
rights pertaining thereto, and shall be relieved of all responsibility for the
Pledged Collateral upon surrendering the same to the Pledgor.

         12.      Waivers, etc. The Pledgor hereby waives presentment, demand,
notice, protest and, except as is otherwise provided herein, in the Loan
Agreement or in any other Loan Document, all other demands and notices in
connection with this Agreement or the enforcement of the Secured Party's rights
hereunder or in connection with any Secured Obligations or any Pledged
Collateral; consents to and waives notice of the granting of renewals,
extensions of time for payment or other indulgences to the Pledgor, any other
Borrower, or to any third party, or substitution, release or surrender of any
collateral security for any Secured Obligation, the addition or release of
persons primarily or secondarily liable on any Secured Obligation or on any
collateral security for any Secured Obligation, the acceptance of partial
payments on any Secured Obligation or on any collateral security for any Secured
Obligation and/or the settlement or compromise thereof. No delay or omission on
the part of the Secured Party in exercising any right hereunder shall operate as
a waiver of such right or of any other right hereunder. Any waiver of any such
right on any one occasion shall not be construed as a bar to or waiver of any
such right on any future occasion. The Pledgor further waives any right it may
have under the constitution of The Commonwealth of Massachusetts (or under the
constitution of any other state in which any of the Pledged Collateral may be
located), or under the Constitution of the United States of America, to notice
(other than any requirement of notice provided herein) or to a judicial hearing
prior to the exercise of any right or remedy provided by this Agreement to the
Secured Party and waives its right, if any, to set aside or invalidate any sale
duly consummated in accordance with the foregoing provisions hereof on the
grounds (if such be the case) that the sale was consummated without a prior
judicial hearing. The Pledgor's waivers under this Section have been made
voluntarily, intelligently and knowingly and after the Pledgor has been apprised
and counseled by its attorneys as to the nature thereof and its possible
alternative rights.

         13.      Termination; Assignment, etc. This Agreement and the security
interest in the Pledged Collateral created hereby shall terminate upon the
earlier to occur of either of the following events (x) when all of the Secured
Obligations have been paid and finally discharged in full in cash (provided that
the Lenders are no longer obligated to make Loans under the Loan Agreement), or
(y) upon the occurrence of the Collateral Release Event. For all purposes of
this Agreement, no Event of Default shall be deemed to have been cured or waived
except as expressly provided in the Loan Agreement. No waiver by the Secured
Party or any Lender or by any other holder of Secured Obligations of any default
shall be

                                     - 5 -

<PAGE>

effective unless in writing nor operate as a waiver of any other default or of
the same default on a future occasion.

         14.      Reinstatement. Notwithstanding the provisions of Section 13,
this Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any amount received by the Lenders or the Secured Party in
respect of the Secured Obligations is rescinded or must otherwise be restored or
returned by the Lenders or the Secured Party upon the insolvency, bankruptcy,
dissolution, liquidation or reorganization of the Pledgor or any other Borrower
or upon the appointment of any intervenor or conservator of, or trustee or
similar official for, the Pledgor or any other Borrower or any substantial part
of their respective properties, or otherwise, all as though such payments had
not been made.

         15.      Governmental Approvals, etc. Upon the exercise by the Secured
Party of any power, right, privilege or remedy pursuant to this Agreement which
requires any consent, approval, qualification or authorization of any
governmental authority or instrumentality, the Pledgor will execute and deliver,
or will cause the execution and delivery of, all applications, certificates,
instruments and other documents and papers that the Secured Party may be
required to obtain for such governmental consent, approval, qualification or
authorization.

         16.      Reserved.

         17.      Notices. Except as otherwise provided herein, all notices to
the Pledgor or to the Secured Party shall be in writing and shall be deemed to
have been sufficiently given or served for all purposes hereof if given or
served in the manner provided for in the Loan Agreement.

         18.      Miscellaneous.

         a.       This Agreement shall inure to the benefit of and be binding
                  upon the Secured Party, the Lenders and the Pledgor and their
                  respective successors and assigns permitted under the Loan
                  Agreement (provided that the Pledgor shall have no right to
                  assign its rights and duties hereunder), and the term
                  "Lenders" shall be deemed to include any other holder or
                  holders of any of the Secured Obligations and the term
                  "Secured Party" shall be deemed to include any successor agent
                  for the Lenders. In case any provision in this Agreement shall
                  be invalid, illegal or unenforceable, the validity, legality
                  and enforceability of the remaining provisions shall not in
                  any way be affected or impaired thereby. This Agreement may be
                  executed in any number of counterparts and by the different
                  parties hereto on separate counterparts, each of which shall
                  be an original, but all of which together shall constitute one
                  instrument.

         b.       This Agreement is intended to be supplemental of the Security
                  Agreement (as defined in the Loan Agreement). All provisions
                  of the Security Agreement (as defined in the Loan Agreement)
                  shall apply to the Pledged Collateral and the Secured Party
                 shall have the same rights with respect to any and all
                  security interests in the Pledged Collateral granted the Agent
                  to secure the Liabilities hereunder as thereunder.
                  Notwithstanding the foregoing, in the event of a conflict
                  between this Agreement and the Security Agreement (as defined
                  in the Loan Agreement), the terms of this Agreement shall
                  control with

                                     - 6 -

<PAGE>

                  respect to the Pledged Collateral and the Security Agreement
                  (as defined in the Loan Agreement) with respect to all other
                  collateral.

         19.      Governing Law; Jurisdiction, Waiver of Jury Trial.

         a.       This Agreement and all rights and obligations hereunder,
                  including matters of construction, validity, and performance,
                  shall be governed by the law of The Commonwealth of
                  Massachusetts.

         b.       Consent to Jurisdiction.

                  i.       The Pledgor agrees that any legal action, proceeding,
                           case, or controversy against the Pledgor with respect
                           to this Agreement or any other Loan Document may be
                           brought in the Superior Court of Suffolk County
                           Massachusetts or in the United States District Court,
                           District of Massachusetts, sitting in Boston,
                           Massachusetts, as the Agent may elect in the Agent's
                           sole discretion. By execution and delivery of this
                           Agreement, the Pledgor, for itself and in respect of
                           its property, accepts, submits, and consents
                           generally and unconditionally, to the jurisdiction of
                           the aforesaid courts.

                  ii.      The Pledgor WAIVES personal service of any and all
                           process upon it, and irrevocably consents to the
                           service of process out of any of the aforementioned
                           courts in any such action or proceeding by the
                           mailing of copies thereof by certified mail, postage
                           prepaid, to the Pledgor at the Pledgor's address for
                           notices as specified herein, such service to become
                           effective five (5) Business Days after such mailing.

                  iii.     The Pledgor WAIVES any objection based on forum non
                           conveniens and any objection to venue of any action
                           or proceeding instituted under this Agreement and
                           consents to the granting of such legal or equitable
                           remedy as is deemed appropriate by the Court.

                  iv.      Nothing herein shall affect the right of the Agent to
                           bring legal actions or proceedings in any other
                           competent jurisdiction.

                  v.       The Pledgor agrees that any action commenced by the
                           Pledgor asserting any claim arising under or in
                           connection with this Agreement or any other Loan
                           Document shall be brought solely in the Superior
                           Court of Suffolk County Massachusetts or in the
                           United States District Court, District of
                           Massachusetts, sitting in Boston, Massachusetts, and
                           that such Courts shall have exclusive jurisdiction
                           with respect to any such action.

         c.       The Pledgor makes the following waiver knowingly, voluntarily,
                  and intentionally, and understands that the Agent and the
                  Lenders in the establishment and maintenance of their
                  respective relationships with the Pledgor contemplated by the
                  within Agreement, is relying thereon. THE PLEDGOR, TO THE
                  EXTENT ENTITLED THERETO, WAIVES ANY PRESENT OR FUTURE RIGHT OF
                  THE PLEDGOR, OR OF ANY GUARANTOR OR ENDORSER OF THE PLEDGOR OR
                  OF ANY OTHER PERSON

                                     - 7 -

<PAGE>

                  LIABLE TO THE AGENT OR THE LENDERS ON ACCOUNT OF OR IN RESPECT
                  TO THE LIABILITIES, TO A TRIAL BY JURY IN ANY CASE OR
                  CONTROVERSY IN WHICH THE AGENT OR THE LENDERS IS OR BECOMES A
                  PARTY (WHETHER SUCH CASE OR CONTROVERSY IS INITIATED BY OR
                  AGAINST THE AGENT OR ANY LENDER OR IN WHICH THE AGENT OR ANY
                  LENDER IS JOINED AS A PARTY LITIGANT), WHICH CASE OR
                  CONTROVERSY ARISES OUT OF, OR IS IN RESPECT TO, ANY
                  RELATIONSHIP AMONGST OR BETWEEN THE PLEDGOR, ANY SUCH PERSON,
                  THE AGENT AND ANY LENDER (AND THE AGENT AND THE LENDERS
                  LIKEWISE WAIVE THE RIGHT TO A JURY IN ANY TRIAL OF ANY SUCH
                  CASE OR CONTROVERSY).

                 {REMAINDER OF PAGE LEFT INTENTIONALLY BLANK}

                                     - 8 -

<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Agreement as a
sealed instrument as of the date first above written.

                                         BROWN BROTHERS HARRIMAN & CO.,
                                         for itself and as Agent for all Lenders

                                         By: ___________________________________
                                         Name:
                                         Title:

                                         DYNAMICS RESEARCH CORPORATION

                                         By: ___________________________________
                                         Name:
                                         Title:

                                     - 9 -

<PAGE>

                                   SCHEDULE I

                              (to Pledge Agreement)

                    PLEDGED STOCK

<TABLE>
<CAPTION>
Description                           No. of Shares               Certificate No(s).
-----------                           -------------               ------------------
<S>                                   <C>                         <C>

</TABLE>

                                     - 10 -

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00071-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00071-of-00352.parquet"}]]