Document:

Exhibit 10.14

Exhibit 10.14

PARK STERLING CORPORATION

RESTRICTED STOCK AWARD

This RESTRICTED STOCK AWARD (the “Award”) is made and entered into as of
 _____, by and
between Park Sterling Corporation (the “Company”), a bank holding company organized under the laws
of the State of North Carolina, and
 _____ 
(the “Director”).

Upon and subject to the Additional Terms and Conditions attached hereto and incorporated
herein by reference as part of this Award and further subject to the provisions of the Park
Sterling Corporation 2010 Long-Term Incentive Plan (the “Plan”), the Company hereby awards as of
the Grant Date to the Director the Restricted Shares in consideration of the Director’s services
rendered and to be rendered to the Company (including any Affiliate) (the “Restricted Stock
Award”).

	 	A.	 	Grant Date:
 _____.

	 
	 	B.	 	Restricted Shares:
 _____ 
shares of the Company’s voting common
stock (“Common Stock”), $1.00 par value per share.

	 
	 	C.	 	Plan under which granted: Park Sterling Corporation 2010 Long-Term Incentive Plan.

D. Vesting: The Restricted Shares shall become vested, as and to the extent
indicated below, only if the Director remains in the continuous service of the Company and
its Affiliates through the applicable Performance-Based Vesting Date indicated in the
Performance-Based Vesting Schedule below:

	 	 	 	 	 
	 	 	Percentage of Restricted Shares	 
	Performance-Based-Vesting Date	 	which are Vested Shares	 
	 
	 	 	 	 
	 
	 	 	 	 

Each of the Performance Goals identified above shall be considered attained when

 

 

The Restricted Shares that are not vested on or before the
earlier of (1) the Director’s Separation from Service or (2)
 _____ 
shall be forfeited.

The Restricted Shares which have satisfied (or are deemed to have satisfied) the conditions
of the Vesting Schedule are herein referred to as the “Vested Shares.” Any portion of the
Restricted Shares which have not become Vested Shares in accordance with this Paragraph D.
before or at the time of Director’s Separation from Service shall be forfeited. There will
be no proration of the Performance-Based Vesting Schedule for partial years of service.

IN WITNESS WHEREOF, the Company and Director have signed this Award as of the Grant Date set
forth above.

	 	 	 	 	 	 	 	 	 
	 	 	Park Sterling Corporation	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 

	 	 	 	 

	 	 

Director
	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 
	 

	 	 	 	 

	 	 	 	 

 

 

 

ADDITIONAL TERMS AND CONDITIONS OF

PARK STERLING CORPORATION

RESTRICTED STOCK AWARD

1. Issuance of Restricted Shares.

(a) The Company shall issue the Restricted Shares as of the Grant Date in either manner
described below, as determined by the Committee in its sole discretion:

(i) by the issuance of share certificate(s) evidencing Restricted Shares to the
Secretary of the Company or such other agent of the Company as may be designated by
the Committee or the Secretary (the “Share Custodian”); or

(ii) by documenting the issuance in uncertificated or book entry form on the
Company’s stock records.

Evidence of the Restricted Shares either in the form of share certificate(s) or book entry,
as the case may be, shall be held by the Company or Share Custodian, as applicable, until
the Restricted Shares become Vested Shares in accordance with the Vesting Schedule.

(b) If the shares of Common Stock are registered under the Securities Act of 1933, as
amended (the “Securities Act”) and the Director is determined by the Committee to be an
“affiliate” of the Company, as such term is defined in Rule 144 (“Rule 144”) under the
Securities Act, the Restricted Shares (and the Vested Shares resulting therefrom) shall be
evidenced only by physical share certificates.

(c) When the Restricted Shares become Vested Shares, the Company or the Share
Custodian, as the case may be, shall deliver the Vested Shares to the Director or, at the
Company’s election, to a broker designated by the Company (the “Designated Broker”) by
either physical delivery of the share certificate(s) or book entry transfer, as applicable,
for the benefit of an account established in the name of the Director. If the number of
Vested Shares includes a fraction of a share, neither the Company nor the Share Custodian
shall be required to deliver the fractional share to the Director, and the Company shall pay
the Director the amount determined by the Company to be the estimated Fair Market Value
therefor. At any time after receipt by the Designated Broker, the Director may require that
the Designated Broker deliver the Vested Shares to the Director pursuant to such
arrangements or agreements as may exist between the Designated Broker and the Director.

(d) In the event that the Director forfeits any of the Restricted Shares, the Company
shall cancel the issuance on its stock records and, if applicable, the Share Custodian shall
promptly deliver the share certificate(s) representing the forfeited shares to the Company.

(e) Director hereby irrevocably appoints the Share Custodian, and any successor
thereto, as the true and lawful attorney-in-fact of Director with full power and authority
to execute any stock transfer power or other instrument necessary to transfer any Restricted
Shares to the Company in accordance with this Award, in the name, place, and stead of the
Director. The term of such appointment shall commence on the Grant Date of this Award and
shall continue until the last of the Restricted Shares are delivered to the Director as
Vested Shares or are returned to the Company as forfeited Restricted Shares, as provided by
the applicable terms of this Award.

 

 

 

(f) Unless and until the Restricted Shares become Vested Shares, the Director shall be
entitled to all rights applicable to holders of shares of Common Stock including, without
limitation, the right to vote such shares and to receive dividends or other distributions
thereon as provided by Section 3, except as otherwise expressly provided in this Award.

(g) In the event the number of shares of Common Stock is increased or reduced as a
result of a subdivision or combination of shares of Common Stock or the payment of a stock
dividend or any other increase or decrease in the number of shares of Common Stock or other
transaction such as a merger, reorganization or other change in the capital structure of the
Company, the Director agrees that any certificate representing shares of Common Stock or
other securities of the Company issued as a result of any of the foregoing shall be
delivered to the Share Custodian or recorded in book entry form, as applicable, and shall be
subject to all of the provisions of this Award as if initially granted hereunder.

2. Acknowledgement by Director of Tax Election Opportunity. Director acknowledges
that the award of the Restricted Shares constitutes a transfer of property for federal income tax
purposes under Section 83 of the Internal Revenue Code and that the Director shall have the sole
responsibility for determining whether to elect early income tax treatment by making an election
permitted under Subsection (b) of Section 83 of the Internal Revenue Code and the sole
responsibility for effecting any such election in an appropriate and on a timely basis.

3. Dividends.

(a) The Director shall be entitled to dividends or other distributions paid or made on
Restricted Shares but only as and when the Restricted Shares to which the dividends or other
distributions are attributable become Vested Shares. Dividends paid on Restricted Shares
will be held by the Company and transferred to the Director, without interest, on such date
as the Restricted Shares become Vested Shares. Dividends or other distributions paid on
Restricted Shares that are forfeited shall be retained by the Company.

(b) The Company’s obligation under this Section 3 shall be an unfunded and unsecured
promise to pay. The Company shall not be obligated under any circumstances to fund its
financial obligations under this Section 3 prior to the date any dividends become payable
pursuant to the terms of this Award. All dividends held in the non-interest bearing account
described in Section 3(a) will remain general assets of the Company subject to the claims of
its general creditors. This Award does not give the Director any ownership interest in the
assets of the Company, and all rights of ownership in the accumulated dividends attributable
to Restricted Shares that become Vested Shares shall be solely those of an unsecured general
creditor of the Company.

4. Restrictions on Transfer of Restricted Shares.

(a) General Restrictions. Except as provided by this Award, the
Director shall not have the right to make or permit to exist any transfer or hypothecation,
whether outright or as security, with or without consideration, voluntary or involuntary, of
all or any part of any right, title or interest in or to any Restricted Shares. Any such
disposition not made in accordance with this Award shall be deemed null and void. The
Company will not recognize, or have the duty to recognize, any disposition not made in
accordance with the Plan and this Award, and any Restricted Shares so transferred will
continue to be bound by the Plan and this Award. The Director (and any subsequent holder of
Restricted Shares) may not sell, pledge or otherwise directly or indirectly transfer
(whether with or without consideration and whether voluntarily or
involuntarily or by operation of law) any interest in or any beneficial interest in any
Restricted Shares except pursuant to the provisions of this Award. Any sale, pledge or
other transfer (or any attempt to effect the same) of any Restricted Shares in violation of
any provision of the Plan or this Award shall be void, and the Company shall not record such
transfer, assignment, pledge or other disposition on its books or treat any purported
transferee or pledgee of such Restricted Shares as the owner or pledgee of such Restricted
Shares for any purpose.

 

 

(b) Certain Permitted Transfers. The restrictions contained in this Section 4
will not apply with respect to transfers of the Restricted Shares pursuant to applicable
laws of descent and distribution; provided that the restrictions contained in this Section 4
will continue to be applicable to the Restricted Shares after any such transfer; and
provided further that the transferee(s) of such Restricted Shares must agree in writing to
be bound by the provisions of the Plan and this Award, including the provisions of Section
6.

5. Additional Restrictions on Transfer.

(a) Certificates evidencing the Restricted Shares shall have noted conspicuously on the
certificate a legend required under applicable securities laws and reflecting the transfer
restrictions set forth herein in addition to any other legend(s) as the Company deems
appropriate and the Director shall not make any transfer of the Restricted Shares without
first complying with the restrictions on transfer described in such legends. Such legends
may include the following:

transfer is restricted

 The shares evidenced by this certificate have been issued pursuant to an exemption
from registration under the Securities act of 1933, as amended (the “Securities Act”) and
applicable state Securities laws and as such may only be sold or otherwise transferred: (1)
pursuant to registration or an exemption from registration under the Securities Act , including
but not limited to Rule 144 thereunder, and the securities laws of any applicable state or
other jurisdiction; or (2) if, in the opinion of counsel, in form and substance satisfactory
to the issuer, such transfer is exempt from registration or is otherwise in compliance with
applicable federal and state securities laws. 

The securities evidenced by this certificate are subject to restrictions on transfer and
forfeiture provisions which also apply to the transferee as set forth in a restricted stock
Award , dated February
 _____, 2011, a copy of which is available from the Company.

(b) Opinion of Counsel. No holder of Restricted Shares may sell, transfer,
assign, pledge or otherwise dispose of (whether with or without consideration and whether
voluntarily or involuntarily or by operation of law) any interest in or any beneficial
interest in any Restricted Shares, except (i) pursuant to an effective registration
statement under the Securities Act or (ii) in a transaction that fully complies with Rule
144, without first delivering to the Company an opinion of counsel (reasonably acceptable in
form and substance to the Company) that neither registration nor qualification under the
Securities Act and applicable state securities laws is required in connection with such
transfer.

6. Lock-up Agreement. The Director hereby agrees that he will not, directly or
indirectly, sell, offer, contract to sell, grant of options for the purchase of, transfer the
economic risk of ownership in, make
any short sale of, pledge or otherwise dispose of any Vested Shares during the thirty (30) days
prior to and the one hundred eighty (180) days (or any shorter period permitted by the managing
underwriter) after the effectiveness of any underwritten public offering, except as part of such
underwritten public offering or if otherwise permitted by the Company. The Director hereby agrees
to execute and deliver any additional document or acknowledgement reflecting the foregoing
provisions or containing similar restrictions as may be requested by the Company or its managing
underwriters in connection with the initial public offering of Common Stock. The Company may place
a legend on any stock certificates representing Vested Shares and may impose stop-transfer
instructions with respect to the Vested Shares in order to enforce the foregoing restrictions.

 

 

 

7. Change in Capitalization.

(a) The number and kind of Restricted Shares shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting from a
subdivision or combination of shares or the payment of a stock dividend in shares of Common
Stock to holders of outstanding shares of Common Stock or any other increase or decrease in
the number of shares of Common Stock outstanding effected without receipt of consideration
by the Company. No fractional shares shall be issued in making such adjustment. All
adjustments made by the Committee under this Section shall be final, binding, and
conclusive.

(b) In the event of a merger, consolidation, extraordinary dividend (including a
spin-off), reorganization, recapitalization, sale of substantially all of the Company’s
assets, other change in the capital structure of the Company, tender offer for shares of
Common Stock or a Change in Control, an appropriate adjustment may be made with respect to
the Restricted Shares such that other securities, cash or other property may be substituted
for the Common Stock held by the Share Custodian or recorded in book entry form pursuant to
this Award.

(c) The existence of the Plan and the Restricted Stock Award shall not affect the right
or power of the Company to make or authorize any adjustment, reclassification,
reorganization or other change in its capital or business structure, any merger or
consolidation of the Company, any issue of debt or equity securities having preferences or
priorities as to the Common Stock or the rights thereof, the dissolution or liquidation of
the Company, any sale or transfer of all or part of its business or assets, or any other
corporate act or proceeding.

8. Governing Laws. This Award shall be construed, administered and enforced according
to the laws of the State of North Carolina; provided, however, no Restricted Shares shall be issued
except, in the reasonable judgment of the Committee, in compliance with exemptions under applicable
state securities laws of the state in which the Director resides, and/or any other applicable
securities laws.

9. Successors. This Award shall be binding upon and inure to the benefit of the
heirs, legal representatives, successors, and permitted assigns of the parties.

 

 

 

10. Notice. All notices, requests, waivers and other communications required or
permitted hereunder shall be in writing and shall be either personally delivered, sent by facsimile
or by reputable overnight courier service or mailed by first class mail, return receipt requested,
to the recipient at the address below indicated:

	 	 	 	 	 
	If to the Company:

	 	Park Sterling Corporation	 	 
	 

	 	Attn: Secretary	 	 
	 

	 	1043 E. Morehead Street, Suite 201	 	 
	 

	 	Charlotte, NC 28204	 	 
	 
	 	 	 	 
	If to the Recipient:
	 	 	 	 
	 

	 	 

	 	 
	 

	 	 

	 	 
	 

	 	 

	 	 

or such other address or to the attention of such other person as the recipient party shall have
specified by prior written notice to the sending party. All such notices, requests, waivers and
other communications shall be deemed to have been effectively given: (a) when personally delivered
to the party to be notified; (b) when sent by confirmed facsimile to the party to be notified; (c)
five (5) business days after deposit in the United States Mail postage prepaid by certified or
registered mail with return receipt requested at any time other than during a general
discontinuance of postal service due to strike, lockout, or otherwise (in which case such notice,
request, waiver or other communication shall be effectively given upon receipt) and addressed to
the party to be notified as set forth above; or (d) two (2) business days after deposit with a
national overnight delivery service, postage prepaid, addressed to the party to be notified as set
forth above with next-business-day delivery guaranteed. A party may change its or his notice
address given above by giving the other party ten (10) days’ written notice of the new address in
the manner set forth above.

11. Severability. In the event that any one or more of the provisions or portion
thereof contained in this Award shall for any reason be held to be invalid, illegal, or
unenforceable in any respect, the same shall not invalidate or otherwise affect any other
provisions of this Award, and this Award shall be construed as if the invalid, illegal or
unenforceable provision or portion thereof had never been contained herein.

12. Entire Agreement. Subject to the terms and conditions of the Plan, this Award
expresses the entire understanding and agreement of the parties with respect to the subject matter.
This Award may be executed in two or more counterparts, each of which shall be deemed an original
but all of which shall constitute one and the same instrument.

13. Headings and Capitalized Terms. Paragraph headings used herein are for
convenience of reference only and shall not be considered in construing this Award. Capitalized
terms used, but not defined, in this Award shall be given the meaning ascribed to them in the Plan.

14. Specific Performance. In the event of any actual or threatened default in, or
breach of, any of the terms, conditions and provisions of this Award, the party or parties who are
thereby aggrieved shall have the right to specific performance and injunction in addition to any
and all other rights and remedies at law or in equity, and all such rights and remedies shall be
cumulative.

15. No Right to Continued Service. Neither the establishment of the Plan nor the
grant of the Restricted Stock Award made pursuant to this Award shall be construed as giving
Director the right to any continued service relationship with the Company or any Affiliate.

16. Compliance with Section 409A of the Code. It is intended that this Award comply
with Section 409A of the Code and the regulations and other guidance promulgated thereunder
(“Code Section 409A”) to the extent it is subject to Code Section 409A, and this Award will
be interpreted and operated consistently with that intent. If the Company determines that
any provisions of this Award do not comply with the requirements of Code Section 409A, the
Company has the authority to amend this Award to the extent necessary (including
retroactively) in order to preserve compliance with said Code Section 409A. The Company
also has express discretionary authority to take such other actions as may be permissible to
correct any failures to comply in operation with the requirements of Code Section 409A.
Neither the Company nor the Director has the discretion to accelerate the timing or schedule
of any benefit payment under this Award that is subject to Code Section 409A, except as
specifically provided herein or as may be permitted pursuant to Code Section 409A.Exhibit 4.2

Exhibit 4.2

TERM NOTE-NON REVOLVING-LINE OF CREDIT NOTE

December 13, 2010

			
	 	 	 
	$250,000.00
	 	Pittsburgh, Pennsylvania

For value received, the undersigned Orbit/FR, Inc., a Delaware corporation, with an address of
506 Prudential Road, Horsham, Pennsylvania 19044, Advanced ElectroMagnetics, Inc., a California
corporation, with an address of 9311 Stevens Road San Tee, CA 92071, Orbit Advanced Technologies,
Inc., a Delaware corporation, with an address of 506 Prudential Road, Horsham, Pennsylvania 19044
and Flam & Russell, Inc., a Delaware corporation, with an address of 506 Prudential Road, Horsham,
Pennsylvania 19044 (collectively, the “Borrower”), jointly and severally, promise to pay to the
order of Citizens Bank of Pennsylvania, a Pennsylvania, state-chartered bank with an address of 525
William Penn Place, Pittsburgh, Pennsylvania 15219-1724 (together with its successors and assigns,
the “Bank”), the principal amount of Two Hundred Fifty Thousand Dollars and Zero Cents
($250,000.00), or, if less, such amount as may be the aggregate unpaid principal amount of all
loans or advances made by the Bank to the Borrower pursuant hereto, on or before 12/13, 2016 (the
“Maturity Date”), The aggregate principal outstanding balance of each Advance shall bear interest
thereon at a per annum rate equal to a fixed rate equal to Two and One-Half Percent (2.50%) above
the Bank’s Cost of Funds (as hereinafter defined).

This Note evidences a line of credit for the purpose of financing the acquisition of
equipment by the Borrower. Advances shall be limited to a maximum of
100% of the invoice price of
equipment, (minimum advance of $50,000.00), less delivery and installation costs acceptable to the
Bank in its sole discretion, based upon invoices or other evidence acceptable to the Bank.
Advances may be made from time to time until 12/13, 2011 (the “Conversion Date”). Undersigned may
borrow, one or more advances hereunder provided, however, that amounts repaid may not be
reborrowed hereunder.

Each advance shall be repaid in equal installments comprised of principal and interest
(calculated by the Bank in the Bank’s sole discretion at the
applicable rate) based upon up to a 5
year amortization period, determined by the Bank in its sole discretion at the time of such
advance and commencing on the date of such advance, except that the last installment shall be due
and payable on the Maturity Date and shall be in an amount equal to the aggregate outstanding
balance on the Maturity Date.

This Note is secured by all collateral granted to the Bank by the Borrower or any endorser or
guarantor hereof or by any other party and shall be secured by any additional collateral hereafter
granted to the Bank by the Borrower or any endorser or guarantor hereof or by any other party.

Principal and interest shall be payable at the Bank’s main office or at such other place as
the Bank may designate in writing in immediately available funds in lawful money of the United
States of America without set-off, deduction or counterclaim. Interest shall be calculated on the
basis of actual number of days elapsed and a 360-day year.

At the option of the Bank, this Note shall become immediately due and payable without notice
or demand upon the occurrence at any time of any of the following events of default (each, an
“Event of Default”): (1) default of any liability, obligation, covenant or undertaking of the
Borrower, any endorser or any guarantor hereof to the Bank, hereunder or otherwise, including,
without limitation, failure to pay in full and when due any installment of principal or interest
or default of the Borrower, any endorser or any guarantor hereof under any other loan document
delivered by the Borrower, any endorser or any guarantor, or in connection with the loan evidenced
by this Note or any other agreement by the Borrower, any endorser or any guarantor with the Bank;
(2) failure of the Borrower, any endorser or any guarantor hereof to maintain aggregate collateral
security value satisfactory to the Bank; (3) default of any material liability, obligation or
undertaking of

 

 

 

the Borrower, any endorser or any guarantor hereof to any other party; (4) if any statement,
representation or warranty heretofore, now or hereafter made by the Borrower, any endorser or any guarantor hereof in connection with the loan evidenced by this Note
or in any supporting financial statement of the Borrower, any endorser or any guarantor hereof
shall be determined by the Bank to have been false or misleading in any material respect when made;
(5) if the Borrower, any endorser or any guarantor hereof is a corporation, trust, partnership or
limited liability company, the liquidation, termination or dissolution of any such organization, or
the merger or consolidation of such organization into another entity, or its ceasing to carry on
actively its present business or the appointment of a receiver for its property; (6) the death of
the Borrower, any endorser or any guarantor hereof and, if the Borrower, any endorser or any
guarantor hereof is a partnership or limited liability company, the death of any partner or member;
(7) the institution by or against the Borrower, any endorser or any guarantor hereof of any
proceedings under the Bankruptcy Code 11 USC §101 et seq. or any other law in which the Borrower,
any endorser or any guarantor hereof is alleged to be insolvent or unable to pay its debts as they
mature, or the making by the Borrower, any endorser or any guarantor hereof of an assignment for
the benefit of creditors or the granting by the Borrower, any endorser or any guarantor hereof of a
trust mortgage for the benefit of creditors; (8) the service upon the Bank of a writ in which the
Bank is named as trustee of the Borrower, any endorser or any guarantor hereof; (9) a judgment or
judgments for the payment of money shall be rendered against the Borrower, any endorser or any
guarantor hereof, and any such judgment shall remain unsatisfied and in effect for any period of
thirty (30) consecutive days without a stay of execution; (10) any levy, lien (including mechanics
lien) except as permitted under any of the other loan documents between the Bank and the Borrower,
seizure, attachment, execution or similar process shall be issued or levied on any of the property
of the Borrower, any endorser or any guarantor hereof; (11) the termination or revocation of any
guaranty hereof; or (12) the occurrence of such a change in the condition or affairs (financial or
otherwise) of the Borrower, any endorser or any guarantor hereof, or the occurrence of any other
event or circumstance, such that the Bank, in its sole discretion, deems that it is insecure or
that the prospects for timely or full payment or performance of any obligation of the Borrower, any
endorser or any guarantor hereof to the Bank has been or may be impaired.

BORROWER HEREBY AUTHORIZES AND EMPOWERS ANY ATTORNEY OR ATTORNEYS OR THE PROTHONOTARY OR
CLERK OF ANY COURT OF RECORD IN THE COMMONWEALTH OF PENNSYLVANIA OR IN ANY OTHER JURISDICTION,
UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, TO APPEAR FOR BORROWER IN ANY SUCH COURT, WITH OR
WITHOUT DECLARATION FILED, AS OF ANY TERM OR TIME THERE OR ELSEWHERE TO BE HELD AND THEREIN TO
CONFESS OR ENTER JUDGMENT AGAINST BORROWER IN FAVOR OF THE BANK FOR ALL SUMS DUE OR TO BECOME DUE
BY BORROWER TO THE BANK UNDER THIS NOTE, WITH COSTS OF SUIT AND RELEASE OF ERRORS AND WITH THE
GREATER OF FIVE PERCENT (5%) OF SUCH SUMS OR $10,000 ADDED AS A REASONABLE ATTORNEY’S FEE AND FOR
DOING SO THIS NOTE OR A COPY VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. SUCH AUTHORITY AND
POWER SHALL NOT BE EXHAUSTED BY ANY EXERCISE THEREOF, AND JUDGMENT MAY BE CONFESSED AS AFORESAID
FROM TIME TO TIME AS OFTEN AS THERE IS OCCASION THEREFOR.

BORROWER ACKNOWLEDGES THAT IT HAS BEEN OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED BY
COUNSEL IN CONNECTION WITH THE EXECUTION AND DELIVERY OF THIS NOTE AND THAT IT KNOWINGLY WAIVES
ITS RIGHT TO BE HEARD PRIOR TO THE ENTRY OF SUCH JUDGMENT AND UNDERSTANDS THAT, UPON SUCH ENTRY,
SUCH JUDGMENT SHALL BECOME A LIEN ON ALL REAL PROPERTY OF BORROWER IN THE COUNTY WHERE SUCH
JUDGMENT IS ENTERED.

Any payments received by the Bank on account of this Note shall, at the Bank’s option, be
applied first, to accrued and unpaid interest; second, to the unpaid principal balance hereof;
third to any costs, expenses or charges then owed to the Bank by the Borrower; and the balance to
escrows, if any. Notwithstanding the foregoing, any payments received after the occurrence and
during the continuance of an Event of Default shall be applied in such manner as the Bank may
determine. The Borrower hereby authorizes the Bank to charge any deposit account which the
Borrower may maintain with the Bank for any payment required hereunder without prior notice to the
Borrower.

 

2

 

If pursuant to the terms of this Note, the Borrower is at any time obligated to pay interest
on the principal balance at a rate in excess of the maximum interest rate permitted by applicable
law for the loan evidenced by this Note, the applicable interest rate shall be immediately reduced
to such maximum rate and all previous payments in excess of the maximum rate shall be deemed to
have been payments in reduction of principal and not on account of the interest due hereunder.

The Borrower represents to the Bank that the proceeds of this Note will not be used for
personal, family or household purposes or for the purpose of purchasing or carrying margin stock
or margin securities within the meaning of Regulations U and X of the Board of Governors of the
Federal Reserve System, 12 C.F.R. Parts 221 and 224.

The Borrower and each endorser and guarantor hereof grant to the Bank a continuing lien on and
security interest in any and all deposits or other sums at any time credited by or due from the
Bank or any Bank Affiliate (as hereinafter defined) to the Borrower and/or each endorser or
guarantor hereof and any cash, securities, instruments or other property of the Borrower and each
endorser and guarantor hereof in the possession of the Bank or any Bank Affiliate, whether for
safekeeping or otherwise, or in transit to or from the Bank or any Bank Affiliate (regardless of
the reason the Bank or Bank Affiliate had received the same or whether the Bank or Bank Affiliate
has conditionally released the same) as security for the full and punctual payment and performance
of all of the liabilities and obligations of the Borrower and/or any endorser or guarantor hereof
to the Bank or any Bank Affiliate and such deposits and other sums may be applied or set off
against such liabilities and obligations of the Borrower or any endorser or guarantor hereof to the
Bank or any Bank Affiliate at any time, whether or not such are then due, whether or not demand has
been made and whether or not other collateral is then available to the Bank or any Bank Affiliate.

No delay or omission on the part of the Bank in exercising any right hereunder shall operate
as a waiver of such right or of any other right of the Bank, nor shall any delay, omission or
waiver on any one occasion be deemed a bar to or waiver of the same or any other right on any
future occasion. The Borrower and every endorser or guarantor of this Note, regardless of the time,
order or place of signing, waives presentment, demand, protest, notice of intent to accelerate,
notice of acceleration and all other notices of every kind in connection with the delivery,
acceptance, performance or enforcement of this Note and assents to any extension or postponement of
the time of payment or any other indulgence, to any substitution, exchange or release of
collateral, and to the addition or release of any other party or person primarily or secondarily
liable and waives all recourse to suretyship and guarantor defenses generally, including any
defense based on impairment of collateral. To the maximum extent permitted by law, the Borrower and
each endorser and guarantor of this Note waive and terminate any homestead rights and/or exemptions
respecting any premises under the provisions of any applicable homestead laws, including without
limitation, Title 42, Section 8123, of the Pennsylvania Consolidated Statutes Annotated.

Borrower hereby waives and releases all errors, defects and imperfections in any proceedings
instituted by the Bank under the terms of this Note or any other loan documents, as well as all
benefits that might accrue to the Borrower by virtue of any present or future laws exempting any
property, real or personal, or any part of the proceeds arising from any sale of such property,
from attachment, levy or sale under execution or providing for any stay of execution, exemption
from civil process or extension of time for payment, as well as the right of inquisition on any
real estate that may be levied upon under a judgment obtained by virtue hereof, and Borrower
hereby voluntarily condemns the same and authorizes the entry of such voluntary condemnation on
any writ of execution issued thereon, and agrees that such real estate may be sold upon any such
writ in whole or in part in any order desired by the Bank.

The Borrower and each endorser and guarantor of this Note shall indemnify, defend and hold
the Bank and the Bank Affiliates and their directors, officers, employees, agents and attorneys
(each an “Indemnitee”) harmless against any claim brought or threatened against any Indemnitee by
the Borrower, by any endorser or guarantor, or by any other person (as well as from attorneys’
reasonable fees and expenses in connection therewith) on account of the Bank’s relationship with
the Borrower or any
endorser or guarantor hereof (each of which may be defended, compromised, settled or pursued by
the Bank with counsel of the Bank’s selection, but at the expense of the Borrower and any endorser
and/or guarantor), except for any claim arising out of the gross negligence or willful misconduct
of the Bank.

 

3

 

The Borrower and each endorser and guarantor of this Note agree to pay, upon demand, costs of
collection of all amounts under this Note including, without limitation, principal and interest, or
in connection with the enforcement of, or realization on, any security for this Note, including,
without limitation, to the extent permitted by applicable law, reasonable attorneys’ fees and
expenses. Upon the occurrence and during the continuance of an Event of Default, interest shall
accrue at a rate per annum equal to the aggregate of 5.0% plus the rate provided for herein. If any
payment due under this Note is unpaid for 10 days or more, the Borrower shall pay, in addition to
any other sums due under this Note (and without limiting the Bank’s other remedies on account
thereof), a late charge equal to the greater of $35.00 or 5.0% of such unpaid amount. In addition
the Borrower shall pay the Bank’s customary fee if any payment made on account of this Note is
dishonored.

This Note shall be binding upon the Borrower and each endorser and guarantor hereof and upon
their respective heirs, successors, assigns and legal representatives, and shall inure to the
benefit of the Bank and its successors, endorsees and assigns.

The liabilities of the Borrower and each Borrower, if more than one, and any endorser or
guarantor of this Note are joint and several; provided, however, the release by the Bank of the
Borrower or any one or more endorsers or guarantors shall not release any other person obligated
on account of this Note. Any and all present and future debts of the Borrower to any endorser or
guarantor of this Note are subordinated to the full payment and performance of all present and
future debts and obligations of the Borrower to the Bank. Each reference in this Note to the
Borrower and each Borrower, if more than one, and endorser or guarantor of this Note, is to such
person individually and also to all such persons jointly. No person obligated on account of this
Note may seek contribution from any other person also obligated, unless and until all liabilities,
obligations and indebtedness to the Bank of the person from whom contribution is sought have been
irrevocably satisfied in full. The release or compromise by the Bank of any collateral shall not
release any person obligated on account of this Note.

The Borrower and each endorser and guarantor hereof each authorizes the Bank to complete this
Note if delivered incomplete in any respect. A photographic or other reproduction of this Note may
be made by the Bank, and any such reproduction shall be admissible in evidence with the same
effect as the original itself in any judicial or administrative proceeding, whether or not the
original is in existence.

The Borrower will from time to time execute and deliver to the Bank such documents, and take
or cause to be taken, all such other further action, as the Bank may request in order to effect
and confirm or vest more securely in the Bank all rights contemplated by this Note or any other
loan documents related thereto (including, without limitation, to correct clerical errors) or to
vest more fully in or assure to the Bank the security interest in any collateral securing this
Note or to comply with applicable statute or law.

This Note shall be governed by federal law applicable to the Bank and, to the extent not
preempted by federal law, the laws of the Commonwealth of Pennsylvania.

Any notices under or pursuant to this Note shall be deemed duly received and effective if
delivered in hand to any officer or agent of the Borrower or Bank, or if mailed by registered or
certified mail, return receipt requested, addressed to the Borrower or Bank at the address set
forth in this Note or as any party may from time to time designate by written notice to the other
party.

 

4

 

The term “Bank Affiliate” as used in this Note shall mean any “Affiliate” of the Bank or any
lender acting as a participant under any loan arrangement between the Bank and the Borrower(s).
The term “Affiliate” shall mean with respect to any person, (a) any person which, directly or
indirectly through one or more intermediaries controls, or is controlled by, or is under common
control with, such person, or (b) any person who is a director or officer (i) of such person, (ii)
of any subsidiary of such person, or (iii) any
person described in clause (a) above. For purposes of this definition, control of a person shall
mean the power, direct or indirect, (x) to vote 5% or more of the Capital Stock having ordinary
voting power for the election of directors (or comparable equivalent) of such person, or (y) to
direct or cause the direction of the management and policies of such person whether by contract or
otherwise. Control may be by ownership, contract, or otherwise.

The Borrower and each endorser and guarantor of this Note each irrevocably submits to the
nonexclusive jurisdiction of any Federal or state court sitting in Pennsylvania, over any suit,
action or proceeding arising out of or relating to this Note. Each of the Borrower and each
endorser and guarantor irrevocably waives, to the fullest extent it may effectively do so under
applicable law, any objection it may now or hereafter have to the laying of the venue of any such
suit, action or proceeding brought in any such court and any claim that the same has been brought
in an inconvenient forum. Each of the Borrower and each endorser and guarantor hereby consents to
any and all process which may be served in any such suit, action or proceeding, (i) by mailing a
copy thereof by registered and certified mail, postage prepaid, return receipt requested, to the
Borrower’s, endorser’s or guarantor’s address shown below or as notified to the Bank and (ii) by
serving the same upon the Borrower(s), endorser(s) or guarantor(s) in any other manner otherwise
permitted by law, and agrees that such service shall in every respect be deemed effective service
upon the Borrower or such endorser or guarantor.

THE BORROWER, EACH ENDORSER AND GUARANTOR AND THE BANK EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY, AND AFTER AN OPPORTUNITY TO CONSULT WITH LEGAL COUNSEL, (A) WAIVES ANY AND ALL
RIGHTS TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING IN CONNECTION WITH THIS NOTE, ANY OF THE
OBLIGATIONS OF THE BORROWER, EACH ENDORSER AND GUARANTOR TO THE BANK, AND ALL MATTERS CONTEMPLATED
HEREBY AND DOCUMENTS EXECUTED IN CONNECTION HEREWITH AND (B) AGREES NOT TO SEEK TO CONSOLIDATE ANY
SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CAN NOT BE, OR HAS NOT BEEN, WAIVED. THE
BORROWER, EACH ENDORSER AND GUARANTOR AND THE BANK EACH CERTIFIES THAT NEITHER THE BANK NOR ANY OF
ITS REPRESENTATIVES, AGENTS OR COUNSEL HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE BANK
WOULD NOT IN THE EVENT OF ANY SUCH PROCEEDING SEEK TO ENFORCE THIS WAIVER OF RIGHT TO TRIAL BY
JURY.

 

5

 

CONFESSION OF JUDGMENT

THE TERMS OF THIS NOTE INCLUDE A WARRANT OF ATTORNEY TO CONFESS JUDGMENT AND HAVE BEEN
NEGOTIATED AND AGREED UPON IN A COMMERCIAL CONTEXT. BORROWER HAS FULLY REVIEWED THE WARRANT OF
ATTORNEY TO CONFESS JUDGMENT WITH ITS OWN COUNSEL, AND IS KNOWINGLY AND VOLUNTARILY WAIVING CERTAIN
RIGHTS IT WOULD OTHERWISE POSSESS, INCLUDING, BUT NOT LIMITED TO, THE RIGHT TO ANY NOTICE OF A
HEARING PRIOR TO THE ENTRY OF JUDGMENT BY THE BANK PURSUANT TO THE FOREGOING WARRANT.

Executed as an instrument under seal as of Dec 13, 2010.

	 	 	 	 	 
	 	Borrower:

 Orbit/FR, Inc.

 	 
	 	By:  	/s/ Relland Winand
 	 
	 	 	Relland Winand, CFO 	 
	 	 	 
	 	By:  	
/s/ Per Iversen
 	 
	 	 	Per Iversen, President & CEO 	 
	 	 	 	 
	 	506 Prudential Road

Horsham, Pennsylvania

19044

Borrower:

Advanced ElectroMagnetics, Inc.

 	 
	 	By:  	/s/  Relland Winand
 	 
	 	 	Relland Winand, CFO 	 
	 	 	 
	 	By:  	
/s/ Per Iversen
 	 
	 	 	Per Iversen, President & CEO 	 
	 
	 	9311 Stevens Road

San Tee, CA
 92071
 	 

 

6

 

	 	 	 	 	 
	 	Borrower:

Orbit Advanced Technologies, Inc.

 	 
	 	By:  	/s/ Relland Winand
 	 
	 	 	Relland Winand, CFO 	 
	 	 	 
	 	By:  	                                         /s/ Per Iversen
 	 
	 	 	Per Iversen, President & CEO 	 
	 	

506 Prudential Road

Horsham, Pennsylvania

19044

Borrower:

Flam & Russell Inc.

 	 
	 	By:  	/s/  Relland Winand
 	 
	 	 	Relland Winand, CFO 	 
	 	 	 
	 	By:  	
/s/  Per Iversen
 	 
	 	 	Per Iversen, President & CEO 	 
	 	 	 	 
	 	506 Prudential Road

Horsham, Pennsylvania

19044
 	 

			
	 	 	 
	 
	 	© 2010 Medici, a division of Wolters Kluwer Financial Services

 

7

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