XETA TECHNOLOGIES INC
EX-10.7 REVOLVING CREDIT AND TERM LOAN AGREEMENT
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<DESCRIPTION>EX-10.7 REVOLVING CREDIT AND TERM LOAN AGREEMENT
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<P align="right"><FONT size="2"><B>Exhibit&nbsp;10.7</B></FONT>

<P align="center"><FONT size="2"><B>REVOLVING CREDIT AND TERM LOAN AGREEMENT</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Revolving Credit and Term Loan Agreement is dated as of October&nbsp;1,
2003, between <B>XETA TECHNOLOGIES, INC.</B>, an Oklahoma corporation (&#147;Borrower&#148;),
and <B>BANK OF OKLAHOMA, N.A. </B>(&#147;Bank&#148;).
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<P align="center"><FONT size="2"><B>RECITALS</B>
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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject to the terms and conditions set forth below, Bank has agreed to
make the following loans to Borrower: (i)&nbsp;a three million three hundred
seventy-four thousand seven hundred thirty-four and 33/100 dollar term loan
($3,374,734.33) (&#147;Term Loan&#148;), (ii)&nbsp;a two million two hundred thirty-eight
thousand three hundred thirty-three and 48/100 dollar term loan ($2,238,333.48)
(&#147;Real Estate Loan&#148;), and (iii)&nbsp;a seven million five hundred thousand and
no/100 dollar revolving line of credit ($7,500,000) (&#147;Revolving Line&#148;).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For valuable consideration received, it is agreed as follows:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DEFINED TERMS. As used in this Agreement, the following terms have the
following meanings (terms defined in the singular to have the same meaning when
used in the plural and vice versa).
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP consistent with
those applied in the preparation of the financial statements referred to
in Section&nbsp;6.8. All financial data submitted pursuant to Section&nbsp;6.8
shall be prepared in accordance with such principles. From time-to-time
or as requested by the Bank, the Borrower may provide the Bank with
financial or operating information about the Borrower which has been
prepared primarily for the Borrower&#146;s internal use or in direct response
to a request from the Bank. Borrower will use its best efforts to ensure
that such information is prepared consistently with previous versions of
such information and is not misleading, but does not represent that such
information will be consistent with GAAP.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2. &#147;Acquisition Term Deduction&#148; means the amount to be deducted
from Borrower&#146;s availability under the Borrowing Base to support the Term
Loan; provided, however, that, so long as no Event of Default exists at
the time of the request, the Acquisition Term Deduction may be
temporarily waived by Borrower, in Borrower&#146;s sole discretion, for a
period not to exceed ninety (90)&nbsp;days during any fiscal year of the
Borrower, upon the written request of Borrower to Bank, to cover working
capital needs. The amount of the Acquisition Term Deduction is
$1,000,000 at inception of this Agreement and shall be reduced
dollar-for-dollar as the Term Loan is reduced through principal payments.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3. &#147;Affiliate&#148; means any Person: (i)&nbsp;which directly or indirectly
controls, or is controlled by, or is under common control with, Borrower;
(ii)&nbsp;which directly or indirectly beneficially owns or holds five percent
(5%) or more of any class of voting stock of either Borrower; or (iii)
five percent (5%) or more of the voting stock of which is directly or
indirectly beneficially owned or held by either Borrower. The term
&#147;control&#148; means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and</FONT></TD>
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    <TD><FONT size="2">policies of a Person,
whether through the ownership of voting securities, by contract, or
otherwise.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4. &#147;Agreement&#148; means this Revolving Credit and Term Loan
Agreement, as amended, supplemented, or modified from time to time.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5. &#147;Borrowing Base&#148; means, at any date of determination
thereof, the sum of eighty percent (80%) of Borrower&#146;s Qualified
Receivables at such date, <I>plus </I>forty percent (40%) of Borrower&#146;s
Qualified Inventory at such date, <I>minus </I>the Acquisition Term Deduction,
as determined by Bank based upon the most recent information relating
thereto provided to Bank pursuant to Section&nbsp;2.2.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6. &#147;Borrowing Base Certificate&#148; means each certificate from
Borrower to Bank relating to the Borrowing Base, substantially in the
form of Schedule &#147;1.6&#148; hereto.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7. &#147;Borrowing Resolutions&#148; means certified Resolutions from the
Secretary of Borrower, in form and content as set forth on Schedule &#147;1.7&#148;
attached hereto.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8. &#147;Business Day&#148; means any day other than a Saturday, Sunday, or
other day on which commercial banks in Oklahoma are authorized or
required to close under the laws of the State of Oklahoma.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9. &#147;Capital Lease&#148; means all leases which have been or should be
capitalized on the books of the lessee in accordance with GAAP.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10. &#147;Cash Taxes&#148; means taxes which are paid each year as required
by the Internal Revenue Service, as shown on the tax returns of Borrower.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11. &#147;Certificates of Good Standing&#148; means a Certificate of Good
Standing issued by the Secretary of State of incorporation for the
Borrower and each Guarantor and such other states in which Borrower and
each Guarantor does business and is required to domesticate or otherwise
register, indicating that Borrower and each Guarantor is in good standing
with the laws of such state(s).</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12. &#147;Code&#148; means the Internal Revenue Code of 1986, as amended
from time to time, and the regulations and published interpretations
thereof.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.13. &#147;Collateral&#148; means all property in which Bank is intended to
have a security interest, as described in Section&nbsp;3.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.14. &#147;Commitment&#148; means the Bank&#146;s obligation to make loans to the
Borrower pursuant to this Agreement.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.15. &#147;Commitment Fee&#148; means the amount payable by the Borrower to
the Bank from the date hereof to the Termination Date, computed at a rate
equal to one-quarter of one percent (.25%) per annum on the average daily
amount of the unused portion of the Revolving Line payable quarterly on
the 1<SUP>st</SUP> day of each January, April, July and October and on the
Termination Date or such earlier date as the Revolving Line shall
terminate as provided herein, commencing October&nbsp;1, 2003.</FONT></TD>
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<P align="center"><FONT size="2">2</FONT>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.16. &#147;Commonly Controlled Entity&#148; means an entity, whether or not
incorporated, which is under common control with the Borrower within the
meaning of Section&nbsp;414(b) or 414(c) of the Code.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.17. &#147;Debt&#148; means, including but not limited to: (i)&nbsp;indebtedness
or liability for borrowed money; (ii)&nbsp;obligations evidenced by bonds,
debentures, notes, or other similar instruments; (iii)&nbsp;obligations for
the deferred purchase price of property or services (including trade
obligations); (iv)&nbsp;obligations under letters of credit; (v)&nbsp;obligations
under acceptance facilities; (vi)&nbsp;all guaranties, endorsements (other
than for collection or deposit in the ordinary course of business), and
other contingent obligations to purchase, to provide funds for payment,
to supply funds to invest in any Person or entity, or otherwise to assure
a creditor against loss; and (vii)&nbsp;obligations secured by any Liens,
whether or not the obligations have been assumed.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.18. &#147;Debt Service Coverage Ratio&#148; shall mean the ratio of (i)
EBITDA for the preceding four (4)&nbsp;consecutive fiscal quarters of
Borrower, to (ii)&nbsp;Borrower&#146;s Debt Service Requirement for the same
period.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.19. &#147;Debt Service Requirement&#148; shall mean, on any given date, the
sum of (i)&nbsp;interest expense (whether paid or accrued and including
interest attributable to Capital Leases) for the immediately preceding
four (4)&nbsp;consecutive quarters, (ii)&nbsp;scheduled principal payments on
borrowed money for (a)&nbsp;during the first year of the Loan, the immediately
following four (4)&nbsp;consecutive quarters, and (b)&nbsp;thereafter for the
immediately preceding four (4)&nbsp;consecutive quarters, and (iii)&nbsp;scheduled
capitalized lease expenditures for (a)&nbsp;during the first year of the Loan,
the immediately following four (4)&nbsp;consecutive quarters, and (b)
thereafter for the immediately preceding four (4)&nbsp;consecutive quarters,
all determined without duplication and in accordance with GAAP,
consistently applied. For purposes of computing the scheduled principal
payments on borrowed money, the entire principal balance of the Revolving
Line shall be excluded.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.20. &#147;EBITDA&#148; shall mean net income plus (i)&nbsp;interest expense, (ii)
depreciation, depletion, obsolescence, amortization of property, and tax
amortization of goodwill (iii)&nbsp;capitalized lease expense, and (iv)&nbsp;tax
expense, all determined in accordance with generally accepted accounting
principles, consistently applied, and for a particular period.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.21. ERISA&#148; means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations and published
interpretations thereof.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.22. &#147;Funded Debt&#148; means any obligations of the Borrower and its
Subsidiaries which are considered to constitute debt in accordance with
GAAP, including indebtedness for borrowed money, interest bearing
liabilities, subordinated debt, and indebtedness secured by
purchase-money security interests; but excluding accounts payable and
other short term non-interest bearing liabilities, future income taxes
(both current and long-term), obligations under covenants not to compete
and accrued liabilities.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.23. &#147;Funded Debt to EBITDA Ratio&#148; means, on any date of
determination, the ratio of (i)&nbsp;Funded Debt on the last day of the most
recently completed fiscal quarter of the Borrower to (ii)&nbsp;EBITDA for the
period of four (4)&nbsp;consecutive fiscal quarters most recently ended on or
prior to such date.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.24. &#147;GAAP&#148; means generally accepted accounting principles in the
United States, applied on a consistent basis.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.25. &#147;Initial Default&#148; means any of the events specified in Section
9, whether or not any requirement for the giving of notice, the lapse of
time, or both, or any other condition has been satisfied.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.26. &#147;Letter of Credit&#148; means any letter of credit issued pursuant
to Sections&nbsp;2.2 and 2.3, for which, when issued, a Letter of Credit Fee
should be paid.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.27. &#147;Letter of Credit Fee&#148; means a fee of one and seventy-five
hundredths percent (1.75%) per annum on the face amount of any Letter of
Credit issued or renewed after the date hereof.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.28. &#147;Lien&#148; means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), or
preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of
the foregoing, and the filing of any financing statement under the
Uniform Commercial Code or comparable law of any jurisdiction in respect
of any of the foregoing.)</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.29. &#147;Loan&#148; means advances under the Revolving Line, the Term Loan,
or the Real Estate Loan.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.30. &#147;Loan Documents&#148; means this Agreement, the Notes, the Security
Agreement, the Mortgage, the UCC-1 Financing Statement and all other
instruments, documents or agreements required under this Agreement.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.31. &#147;Matured Default&#148; means any of the events specified in Section
9, provided that any requirement for the giving of notice, the lapse of
time, or both, or any other condition has been satisfied.</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.32. &#147;Mortgage&#148; means a first and prior real estate Mortgage,
Assignment of Rents and Leases, Security Agreement and Financing
Statement in favor of Bank on the Mortgaged Property, in form and content
substantially as set forth on Schedule &#147;1.32&#148; hereto.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.33. &#147;Mortgaged Property&#148; means the property set forth on Schedule
&#147;1.33&#148; hereto.</FONT></TD>
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    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.34. &#147;Mortgage Related Documents&#148; means, with regard to the
Mortgaged Property:</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;the Title Insurance Binder prior to closing, and Title
Insurance Policy within twenty (20)&nbsp;days of the Closing to Bank,
evidencing only those exceptions acceptable to Bank;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;an appraisal on the Mortgaged Property, in form and
content satisfactory to Bank, evidencing an aggregate minimum value
reasonably acceptable to Bank;</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">4</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;if required by Bank, a Phase I Environmental Audit from
an auditor and in form and content acceptable to Bank; and</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;evidence that flood insurance is not required of Bank.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.35. &#147;Multiemployer Plan&#148; means a Plan described in Section
4001(a)(3) of ERISA.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.36. &#147;Notes&#148; means, separately and collectively, the Term Note, the
Real Estate Note, and the Revolving Line Note.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.37. &#147;Obligations&#148; means the Obligations defined in Section&nbsp;3.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.38. &#147;Opinion of Borrower&#146;s Counsel&#148; means a legal opinion from
Borrower&#146;s legal counsel including, without limitation, the opinions
relating to Borrower and this loan transaction as set forth on Schedule
&#147;1.38&#148; attached hereto.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.39. &#147;PBGC&#148; means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.40. &#147;Permitted Liens&#148; means, as to Borrower and all Subsidiaries:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;Liens in favor of the Bank;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;Liens for taxes or assessments or other government charges
or levies if not yet due and payable or, if due and payable or, if
they are being contested in good faith by appropriate proceedings
and for which appropriate reserves are maintained;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;Liens imposed by law, such as mechanics&#146;, materialmen&#146;s,
landlords&#146;, warehousemen&#146;s, and carriers&#146; liens, and other similar
Liens, securing obligations incurred in the ordinary course of
business which are not past due for more than thirty (30)&nbsp;days or
which are being contested in good faith by appropriate proceedings
and for which appropriate reserves have been established;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;Liens under workers&#146; compensation, unemployment insurance,
Social Security, or similar legislation;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5)&nbsp;Liens, deposits, or pledges to secure the performance of
bids, tenders, contracts (other than contracts for the payment of
money), leases (permitted under the terms of this Agreement),
public or statutory obligations, surety, stay, appeal, indemnity,
performance or other similar bonds, or other similar obligations
arising in the ordinary course of business;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6)&nbsp;The liens described on Schedule &#147;1.40(6)&#148;;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7)&nbsp;Judgment and other similar liens arising in connection
with court proceedings, provided the execution or other enforcement
of such Liens is effectively bonded, stayed and the claims secured
thereby are being actively contested in good faith and by
appropriate proceedings;</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">5</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8)&nbsp;Easements, rights-of-way, restrictions, and other similar
encumbrances which, in the aggregate, do not materially interfere
with the occupation, use and enjoyment by the Borrower of the
property or assets encumbered thereby in the normal course of its
business or materially impair the value of the property subject
thereto; and</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9)&nbsp;Purchase-money liens on any property hereafter acquired or
the assumption of any lien on property existing at the time of such
acquisition (and not created in contemplation of such acquisition),
or a lien incurred in connection with any conditional sale or other
title retention agreement or a Capital Lease; provided that:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Any property subject to any of the foregoing is
acquired by the Borrower or any subsidiary in the ordinary
course of its business; and</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Each such lien shall attach only to the property so
acquired and fixed improvements thereon.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.41. &#147;Person&#148; means an individual, partnership, corporation,
business trust, joint stock company, trust, unincorporated association,
joint venture, governmental authority, or other entity of whatever
nature.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.42. &#147;Plan&#148; means any pension plan which is covered by Title IV of
ERISA and in respect of which the Borrower or a Commonly Controlled
Entity is an &#147;employer&#148; as defined in Section&nbsp;3(5) of ERISA.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.43. &#147;Principal Office&#148; means the Bank&#146;s main office located at
Seven East Second Street, BOk Tower-8th Floor, Tulsa, Oklahoma 74102.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.44. &#147;Prohibited Transaction&#148; means any transaction set forth in
Section&nbsp;406 of ERISA or Section&nbsp;4975 of the Code.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.45. &#147;Qualified Inventory&#148; means the amount of inventory of
Borrower located in the United States of America or Canada that is not
subject to any Lien or adverse claim and that conforms to the
representations and warranties contained in this Agreement and that is
acceptable to the Bank in its sole discretion, <I>less </I>any packaging
materials and supplies, damaged or unsalvageable goods returned or
rejected by its customers, goods to be returned to its suppliers, goods
in transit to third parties (other than its agent or warehouses) and
goods out at contractors, and <I>less </I>any reserves required by the Bank in
its sole discretion for special order goods, market value declines and
bill and hold (deferred shipment) sales. Qualified Inventory includes
spare parts owned by the Borrower for use in supporting its customers.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46. &#147;Qualified Receivables&#148; means and includes only accounts
receivable of Borrower which meet the following specifications at the
time they came into existence and continue to meet the same until
collected in full.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.1. The account is due and payable. No account shall be
outstanding for more than ninety (90)&nbsp;days from the date of the
applicable invoice.</FONT></TD>
</TR>
</TABLE>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.2. The account arose from a bona fide outright sale of
goods previously made or from the performance of services, but not
from leasing, and the applicable Borrower has possession of or has
delivered to Bank shipping and delivery receipts evidencing
shipment of the goods or, if representing services, the services
have been fully performed for the respective account debtor.</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.3. The account is not subject to any assignment, claim,
lien or security interest of any character or subject to any
attachment, levy, garnishment or other judicial process, except the
security interest of Bank.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.4. The account is not subject to any claim for credit,
setoff, allowance, adjustment by the account debtor or
counterclaim, and no Borrower has received any notice of any such
claim for credit, setoff, allowance, adjustment or counterclaim
from or on behalf of the account debtor.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.5. The account arose in the ordinary course of each
Borrower&#146;s business and no notice of the bankruptcy, insolvency or
adverse change in the financial condition of the account debtor has
been received by any Borrower or Bank.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.6. Bank has not previously notified any Borrower that the
account or the account debtor is or has become unsatisfactory,
based upon reasonable credit standards, or the account debtor has
been adjudicated bankrupt or is subject to a similar proceeding.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.7. The account is not evidenced by a judgment, an
instrument or chattel paper.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.8. The account debtor is not a governmental entity except
that up to $1,000,000 of the total Qualified Receivables may be
from governmental entities.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.9. The account debtor is not a foreign (i.e., residing or
incorporated in or organized under a jurisdiction outside the
United States) person or company and is not a parent, subsidiary,
officer, employee, director, agent or Affiliate of Borrower, and
the account debtor and Borrower do not have common shareholders,
officers or directors; provided that Bank specifically excludes any
Bank Approved Account Debtor (defined below) from this subsection.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.10. All receivables of one account debtor shall become
ineligible if more than 10% of such receivables are over ninety
(90)&nbsp;days past due from the invoice.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.11. The account debtor (excluding any Bank Approved
Account Debtor) cannot exceed 25% of the total accounts receivable,
and any amounts over 25% will be excluded from the Borrowing Base
unless specifically waived in writing in each instance by Bank in
its sole discretion.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.12. With regard only to Sections&nbsp;1.46.10 and 1.46.11, the
term &#147;Bank Approved Account Debtor&#148; means an express written
designation given by Bank in its discretion as to an account debtor
on a semi-annual basis, effective January and</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">7</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">July of each calendar
year. Borrower shall submit a proposed list of account debtors to
Bank at least ten (10)&nbsp;days prior to the semi-annual designation
date, which list must be accompanied by such information relating
to the proposed account debtor as Bank may reasonably require.
Bank shall advise Borrower on or before the applicable semi-annual
effective date whether any or all of the proposed account debtors
has been designated as a Bank Approved Account Debtor. Any such
designation shall be effective only for the ensuing six (6)&nbsp;month
period, and any designation by Bank shall have no relevance with
regard to subsequent designations.
The initially approved Bank Approved Account Debtors are Host
Marriott Corporation, Marriott International, Hilton Hotels
Corporation, Avaya Financial Leasing, Time Warner, Texas Cable
Partners, and Union Electric Company (Ameren).</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46.13. Qualified Receivables also include accrued accounts
receivable that represent the Borrower&#146;s legally billable, but not
yet billed materials which have been shipped to its customer(s).</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.47. &#147;Real Estate Note&#148; shall mean the $2,238,333.48 Promissory
Note in form and content as set forth on Schedule &#147;1.47&#148; attached hereto.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.48. &#147;Reportable Event&#148; means any of the events set forth in
Section&nbsp;4043 of ERISA.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.49. Revolving Line Note&#148; shall mean the $7,500,000 Promissory Note
in form and content as set forth on Schedule &#147;1.49&#148; attached hereto.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.50. &#147;Security Agreement&#148; means the Security Agreement and other
Collateral documents described in Section&nbsp;3.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.51. &#147;Subsidiaries&#148; means, separately and collectively, any
corporation of which shares of stock having ordinary voting power (other
than stock having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other
managers of such corporation are at the time owned, or the management of
which is otherwise controlled, directly or indirectly through one or more
intermediaries, or both, by the Borrower.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.52. &#147;Tangible Net Worth&#148; means, without duplication, as at any
time of determination thereof, net worth <I>less </I>(a)&nbsp;all intangible items,
including without limitation, goodwill, licenses, organizational expense,
unamortized debt discount and expense carried as an asset, all reserves
and any write-up in the book value of assets, and (b)&nbsp;all reserves for
depreciation and other asset valuation reserves (but excluding reserves
for federal, state, and other income taxes), net of accumulated
amortization.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.53. &#147;Termination Date&#148; means December&nbsp;31, 2004.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.54. &#147;Term Note&#148; shall mean the $3,374,734.33 Promissory Note in
form and content as set forth on Schedule &#147;1.53&#148; attached hereto.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.55. &#147;Title Insurance Binder&#148; means an original mortgagee&#146;s title
guaranty binder or commitment in favor of Bank issued by a title insurer
and agent satisfactory to Bank,</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">8</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">committing to issue an ALTA mortgagee&#146;s
title guaranty policy insuring the Mortgage to be a first and prior lien
on the Mortgaged Property and improvements, containing only such
exceptions which are acceptable to Bank.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.56. &#147;Title Insurance Policy&#148; means an original fully paid ALTA
mortgage title insurance policy issued pursuant to the Title Insurance
Binder in an amount acceptable to Bank and insuring the Mortgage to be a
first and prior lien on Borrower&#146;s fee simple ownership interests (or
leasehold, as applicable) in the Mortgaged Property and improvements,
with no exceptions from coverage as to mechanics&#146; and materialmen&#146;s
liens,
matters shown by a current survey, right of parties in possession,
or such other exceptions as Bank shall approve.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.57. &#147;UCC&#148; shall mean the Uniform Commercial Code of the State of
Oklahoma.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.58. &#147;UCC-1 Chattel Check&#148; means a UCC Information and/or Copy
Request as to Borrower from the Chattel Records Division of the Oklahoma
County Clerk, and from any other office deemed necessary or advisable by
Bank, which chattel checks must evidence no conflicting security
interests, except the Permitted Liens.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.59. &#147;UCC-1 Financing Statement&#148; means a financing statement in
form and content substantially as set forth on Schedule &#147;1.59&#148; attached
hereto, which will be filed with the appropriate office and shall
evidence perfection of a first and prior security interest in the
collateral described in the Security Agreements in favor of Bank, except
for the Permitted Liens.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AMOUNT AND TERMS OF THE LOANS.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. Term Loan. Subject to the terms and conditions of this
Agreement, the Bank agrees to loan Borrower $3,374,734.33, to be further
evidenced by the Term Note. The purpose of the advance under the Term
Note is to enable Borrower to refinance Borrower&#146;s debt with Bank One.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Real Estate Loan. Subject to the terms and conditions of this
Agreement, the Bank agrees to loan Borrower $2,238,333.48, to be further
evidenced by the Real Estate Note. The purpose of the advance under the
Real Estate Note is to enable Borrower to refinance Borrower&#146;s debt with
Bank One.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. Revolving Line. Subject to the terms and conditions of this
Agreement, and so long as no Initial Default or Matured Default has
occurred, Bank agrees to loan to Borrower (by advancing funds or issuing
Letters of Credit in amounts not to exceed $7,500,000 in the aggregate),
such amounts up to $7,500,000 as Borrower may request from time to time
on or before the maturity of the Revolving Line Note, provided that the
aggregate principal amount of advances at any time outstanding shall not
exceed the lesser of (i) $7,500,000 or (ii)&nbsp;the Borrowing Base. Such
Borrowing Base shall be computed on a monthly basis, and Borrower agrees
to provide Bank on the 10th day of each month with regard to the
immediately preceding month all information requested in connection
therewith, including without limitation a Borrowing Base Certificate. In
the event Bank shall make advances in excess of the formula set forth
above, any such advance shall, nevertheless, be secured by all
Collateral. In the event outstanding advances with respect to Qualified
Receivables or Qualified Inventory fail to comply with such formula, by
reason of any</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">9</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">accounts receivable or inventory ceasing to be so
qualified, for whatever reason, then Borrower shall immediately notify
Bank of such situation and shall, within five (5)&nbsp;Business Days of the
imbalance, either (i)&nbsp;reduce the amount of the outstanding balances to
bring such amounts within the formulas prescribed, or (ii)&nbsp;provide
additional Qualified Receivable or Qualified Inventory, without any
additional advance being made by Bank with respect thereto, necessary to
comply with the formulas required herein. Within the limits set forth in
this Section&nbsp;2.2, Borrower may borrow, repay and reborrow at any one time
and from time to time.</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. Notice and Manner of Borrowing. The Borrower shall give the
Bank at least one (1)&nbsp;Business Day&#146;s notice of any Loans under this
Agreement, specifying the date and amount thereof. Such notice shall be
in writing or via telephone (with voice verification by the appropriate
officer), no later than 10:00&nbsp;a.m. (Tulsa time) on the date of such Loan
and upon fulfillment of the applicable conditions, the Bank will make
such Loan available to the Borrower in immediately available funds by
crediting the amount thereof to the following account with the Bank:
Account styled Xeta Corporation, No.&nbsp;209909011.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECURITY. As security for any and all indebtedness, obligations or
liabilities of every kind and description of Borrower to Bank, including,
without limitation, all advances and Loans evidenced by the Notes, and any
other advances or loans made pursuant to this Agreement or any other
instrument, document, agreement executed and/or delivered by Borrower to Bank
in connection herewith, including any extensions, renewals or changes in form
of any of the Notes, and any other obligations or liabilities now existing or
hereafter arising, direct or indirect, absolute or contingent, joint and/or
several, howsoever created or obtained (separately and collectively, the
&#147;Obligations&#148;), Borrower grants to Bank the following liens and security
interests and also agrees as follows:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1. A first and prior security interest in all assets of Borrower
including, without limitation, accounts, inventory, equipment, software,
general intangibles and chattel paper of Borrower, whether now owned or
hereafter acquired, howsoever arising or wheresoever located, all as
evidenced by the Security Agreement set forth on Schedule &#147;3.1&#148; attached
hereto.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2. A first and prior mortgage lien against the Mortgaged Property,
as evidenced by the Mortgage.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3. All proceeds and products of the foregoing.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4. Borrower also agrees to execute and deliver all financing
statements or other instruments, documents or agreements required by Bank
in order to effectuate the intent of the parties in connection herewith,
including without limitation documents necessary for proper perfection as
deemed necessary and/or advisable by Bank and legal counsel.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CONDITIONS PRECEDENT.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1. Closing. The commitment of Bank to advance funds under the
Notes shall be conditioned upon the following being satisfied:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1. Borrower shall execute and /or deliver to Bank the following:</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">10</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.1. This Agreement;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.2. Revolving Line Note;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.3. Term Note;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.4. Real Estate Note;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.5. Mortgage;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.6. Security Agreement;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.7. Financing Statement;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.8. Opinion of Borrower&#146;s Counsel;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.9. Borrowing Resolutions;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.10. Certificates of Good Standing;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.11. Chattel Check;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.12. Mortgage Related Documents;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.13. All schedules to this Agreement;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1.14. Any other instruments, documents or agreements
reasonably requested by Bank in connection herewith.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.2. The following statements shall be true and correct.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. The representations and warranties contained in this
Agreement and the other Loan Documents shall be true and
correct; and</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. No Initial Default or Matured Default has occurred and is
continuing or will occur as a result of the execution,
delivery and/or performance by Borrower under any of the Loan
Documents.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.3. The Bank shall have received such other approvals,
opinions, instruments, documents and/or agreements which it may
reasonably request.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;REPRESENTATIONS AND WARRANTIES. The Borrower represents and warrants
to the Bank that:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1. Incorporation, Good Standing, and Due Qualification. Borrower
is a corporation duly incorporated, validly existing, and in good
standing under the laws of the State in which it is incorporated; has the
corporate power and authority to own its assets and to transact the
business in which it is now engaged or proposed to be engaged; and is
duly qualified as a foreign corporation and in good standing under the
laws of each other jurisdiction in which such qualification is required.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">11</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2. Corporate Power and Authority. The execution, delivery, and
performance by Borrower of the Loan Documents have been duly authorized
by all necessary corporate action and do not and will not (1)&nbsp;require any
consent or approval of the stockholders which has not been given; (2)
contravene Borrower&#146;s charter or bylaws; (3)&nbsp;violate any provision of any
law, rule, regulation (including, without limitation, Regulations U and X
of the Board of Governors of the Federal Reserve System), order, writ,
judgment, injunction, decree, determination, or award presently in effect
having applicability to Borrower; (4)&nbsp;result in a breach of or constitute
a default under any indenture or loan or credit agreement or any other
agreement, lease, or instrument to which Borrower is a party or by which
it or its properties may be bound or affected; (5)&nbsp;result in, or require,
the creation or imposition of any lien, upon
or with respect to any of the properties now owned or hereafter
acquired by Borrower; or (6)&nbsp;cause Borrower to be in default under any
such law, rule, regulation, order, writ, judgment, injunction, decree,
determination, or award or any such indenture, agreement, lease, or
instrument.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3. Legally Enforceable Agreement. This Agreement is, and each of
the other Loan documents when delivered under this Agreement will be,
legal, valid, and binding obligations of Borrower, enforceable against
Borrower in accordance with their respective terms, except to the extent
that such enforcement may be limited by applicable bankruptcy,
insolvency, and other similar laws affecting creditors&#146; rights generally.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4. Financial Statements. The balance sheet of Borrower as of July
31, 2003, the related statements of income and retained earnings of
Borrower for the nine (9)&nbsp;months then ended, are complete and correct and
fairly present the financial condition of Borrower at such dates and the
results of the operations of Borrower for the periods covered by such
statements, all in accordance with GAAP consistently applied (subject to
year-end adjustments in the case of the interim financial statements),
and since July&nbsp;31, 2003, there has been no material adverse change in the
condition (financial or otherwise), business or operations of Borrower.
There are no liabilities of Borrower, fixed or contingent, which are
material but not reflected in such financial statements or in the notes
thereto, other than liabilities arising in the ordinary course of
business since July&nbsp;31, 2003. No information, exhibit, or report
furnished by the Borrower to the Bank in connection with the negotiation
of this Agreement contains any material misstatement of fact or omits to
state a material fact or any fact necessary to make the statement
contained therein not materially misleading.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5. Labor Disputes and Acts of God. Neither the business nor the
properties of Borrower is affected by any fire, explosion, accident,
strike, lockout or other labor dispute, drought, storm, hail, earthquake,
embargo, act of God or other casualty (whether or not covered by
insurance), materially adversely affecting such business or the operation
of Borrower.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6. Other Agreements. Borrower is not a party to any indenture,
loan, or credit agreement, or to any lease or other agreement or
instrument, or subject to any charter or corporate restriction, which
could have a material adverse effect on the business, properties, assets,
operations, or condition, financial or otherwise, of Borrower or the
ability of Borrower to carry out its obligations under the Loan
Documents. Borrower is not in material default in any respect in the
performance, observance, or fulfillment of any of the obligations,
covenants, or conditions contained in any agreement or instrument
material to its business to which it is a party.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">12</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.7. Litigation. There is no pending or threatened action or
proceeding against or affecting Borrower before any court, governmental
agency or arbitrator, which may, in any one case or in the aggregate,
materially adversely affect the financial condition, operations,
properties, or business of Borrower or the ability of Borrower to perform
its obligations under the Loan Documents. Any litigation which does
exist is set forth in detail satisfactory to Bank on Schedule &#147;5.7&#148;
hereto, but Borrower represents to Bank that such litigation does not
violate this Section&nbsp;5.7.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.8. Ownership and Liens. Borrower has title to, or valid leasehold
interests in, all of its properties and assets, real and personal,
including the properties and assets and leasehold interest reflected in
the financial statements referred to in Section&nbsp;5.4, and none of
the properties and assets owned by Borrower, and none of its
leasehold interests, are subject to any lien, except the Permitted Liens.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9. ERISA. Borrower is in compliance in all material respects with
all applicable provisions of ERISA. Neither a Reportable Event nor a
Prohibited Transaction has occurred and is continuing with respect to any
Plan; no notice of intent to terminate a Plan has been filed, nor has any
Plan been terminated; no circumstances exist which constitute grounds
entitling the PBGC to institute proceedings to terminate, or appoint a
trustee to administer, a Plan, nor has the PBGC instituted any such
proceedings; neither Borrower nor any Commonly Controlled Entity has
completely or partially withdrawn from a Multiemployer Plan; Borrower and
each Commonly Controlled Entity have met their minimum funding
requirements under ERISA with respect to all of their Plans and the
present value of all vested benefits under each Plan exceeds the fair
market value of all Plan assets allocable to such benefits, as determined
on the most recent valuation date of the Plan and in accordance with the
provisions of ERISA; and neither Borrower nor any Commonly Controlled
Entity has incurred any liability to the PBGC under ERISA.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.10. Operation of Business. To the best of its knowledge, Borrower
possesses all licenses, permits, franchises, patents, copyrights,
trademarks, and trade names, or rights thereto, to conduct its business
substantially as now conducted and as presently proposed to be conducted,
and Borrower is not in violation of any valid rights of others with
respect to any of the foregoing.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.11. Taxes. Borrower has filed all tax returns (federal, state and
local) required to be filed and have paid all taxes, assessments, and
governmental charges and levies thereon to be due, including interest and
penalties.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.12. Debt. Schedule &#147;5.12&#148; is a complete and correct list of all
credit agreements, indentures, purchase agreements, guaranties, Capital
Leases, and other investments, agreements, and arrangements presently in
effect providing for or relating to extensions of credit (including
agreements and arrangements for the issuance of letters of credit or for
acceptance financing) in respect of which Borrower is in any manner
directly or contingently obligated; and the maximum principal or face
amounts of the debt in question, which are outstanding and which can be
outstanding, are correctly stated, and all liens of any nature given or
agreed to be given as security therefor are correctly described or
indicated in such Schedule. With regard to any guaranty or other
contingent obligation of Borrower, Borrower shall promptly notify Bank in
the event any such obligation becomes non-contingent.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">13</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.13. Environment. Borrower has duly complied with, and its
business, operations, assets, equipment, property, leaseholds, or other
facilities are in compliance with, the provisions of all federal, state,
and local environmental, health and safety laws, codes and ordinances,
and all rules and regulations promulgated thereunder. Borrower has been
issued and will maintain all required federal, state, and local permits,
licenses, certificates and approvals relating to (1)&nbsp;air emissions; (2)
discharges to surface or groundwater; (3)&nbsp;noise emissions; (4)&nbsp;solid or
liquid waste disposal; (5)&nbsp;the use, generation, storage, transportation
or disposal or toxic or hazardous substances or wastes (intended hereby
and hereafter to include any and all such materials listed in any
federal, state, or local law, code or ordinance, and all rules and
regulations promulgated thereunder as hazardous or potentially
hazardous); or (6)&nbsp;other environmental, health or safety matters.
Borrower has not received notice of, nor to its best knowledge knows of
or suspects, facts which might constitute any violations of any federal,
state or local environmental, health, or safety laws,
codes or ordinances, and any rules or regulations promulgated
thereunder with respect to its business, operations, assets, equipment,
property, leaseholds, or other facilities. To Borrower&#146;s best knowledge,
there has been no emission, spill, release, or discharge into or upon (1)
the air; (2)&nbsp;soils, or any improvements located thereon; (3)&nbsp;surface
water or groundwater; or (4)&nbsp;the sewer, septic system or waste treatment,
storage or disposal system servicing the premises, of any toxic or
hazardous substances or wastes at or from the premises; and accordingly
the premises of the Borrower is free of all such toxic or hazardous
substances or wastes. Except as disclosed in writing to Bank, there has
been no complaint, order, directive, claim, citation, or notice by any
governmental authority or any person or entity with respect to (1)&nbsp;air
emissions; (2)&nbsp;spills, releases, or discharges to soils or improvements
located thereon, surface water, groundwater or the sewer, septic system
or waste treatment, storage or disposal systems servicing the premises;
(3)&nbsp;noise emissions; (4)&nbsp;solid or liquid waste disposal; (5)&nbsp;the use,
generation, storage, transportation, or disposal of toxic or hazardous
substances or waste; or (6)&nbsp;other environmental, health, or safety
matters affecting Borrower or its business, operations, assets,
equipment, property, leaseholds, or other facilities. Borrower has no
indebtedness, obligation, or liability, absolute or contingent, matured
or not matured, with respect to the storage, treatment, cleanup or
disposal of any solid wastes, hazardous wastes or other toxic or
hazardous substances (including without limitation any such indebtedness,
obligation, or liability with respect to any current regulation, law, or
statute regarding such storage, treatment, cleanup or disposal).</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AFFIRMATIVE COVENANTS. So long as any Note shall remain unpaid or the
Bank shall have any Commitment under this Agreement, Borrower will comply with
the following:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1. Maintenance of Existence. Preserve and maintain its corporate
existence and good standing in the states in which it does business, and
qualify and remain qualified as a foreign corporation in each
jurisdiction in which such qualification is required.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2. Maintenance of Records. Keep adequate records and books of
account, in which complete entries will be made in accordance with GAAP
consistently applied, reflecting all financial transactions.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3. Maintenance of Properties. Maintain, keep, and preserve all of
its properties (tangible and intangible) necessary or useful in the
proper conduct of its business in good working order and condition,
ordinary wear and tear excepted.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">14</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4. Conduct of Business. Continue to engage in an efficient and
economical manner in a business of the same general type as conducted by
it on the date of this Agreement.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5. Maintenance of Insurance. Borrower will keep or cause to be
kept adequately insured by financially sound and reputable insurers its
plant, equipment, motor vehicles, and all other property of a character
usually insured by businesses engaged in the same or similar businesses.
Upon demand by the Bank, any insurance policies covering the Collateral
shall be endorsed to provide for payment of losses to the Bank as its
interest may appear, to provide that such policies may not be canceled,
reduced or affected in any manner for any reason without thirty days
prior notice to the Bank, and to provide for any other matters which the
Bank may reasonably require; and such insurance shall be against fire,
casualty and any other hazards normally insured against and shall be in
the amount of the full value (less a reasonable deductible not to exceed
amounts customary in the industry
for similarly situated businesses and properties) of the property
insured. The Borrower shall at all times maintain adequate insurance
against damage to persons or property, which insurance shall be by
financially sound and reputable insurers and shall, without limitation,
provide the following coverages: comprehensive general liability
(including, without limitation, coverage, where applicable, damage caused
by explosion, broad form property damage coverage, broad form coverage
for contractually independent contractors), worker&#146;s compensation,
products liability and automobile liability.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6. Compliance with Laws. Comply in all material respects with all
applicable laws, rules, regulations, and orders, such compliance to
include, without limitation, paying before the same become delinquent all
taxes, assessments, and governmental charges imposed upon it or upon its
property.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7. Right of Inspection. At any reasonable time and from time to
time, and following reasonable prior written notice, permit the Bank or
any agent or representative thereof, to reasonably examine and make
copies of and abstracts from the records and books of account of, and
visit the properties of, Borrower, and to discuss the affairs, finances,
and accounts of Borrower with any of its officers and directors and
Borrower&#146;s independent accountants. Bank contemplates conducting at
least semi-annual field audits of the Borrower&#146;s property. Such
inspections and field audits shall be conducted at the Bank&#146;s expense.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8. Reporting Requirements. Furnish to Bank:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.1. Quarterly Financial Statements. As soon as available
and in any event within forty-five (45)&nbsp;days after the end of each
fiscal quarter of Borrower, Borrower shall deliver to Bank a copy
of its Form&nbsp;10Q that has been or will be filed with the Securities
and Exchange Commission.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.2. Annual Financial Statements. As soon as available and
in any event within ninety (90)&nbsp;days after the end of each fiscal
year of Borrower, commencing with the fiscal year ending October
31, 2003, a copy of its Form&nbsp;10K that has been or will be filed
with the Securities and Exchange Commission. Such filing shall
include an unqualified opinion on the Borrower&#146;s financial
statements acceptable to the Bank by independent accountants
selected by Borrower and acceptable to the Bank;</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">15</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.3. Management Letters. Promptly upon receipt thereof,
copies of any reports submitted to Borrower by independent
certified public accountants in connection with examination of the
financial statements of Borrower made by such accountants;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.4. Certificate of No Default. Within twenty (20)&nbsp;days
after the end of each of the quarters of each fiscal year of
Borrower a certificate of the chief financial officer of Borrower
(a)&nbsp;certifying that to the best of his knowledge no Initial Default
or Matured Default has occurred and is continuing, or if an Initial
Default or Matured Default has occurred and is continuing, a
statement as to the nature thereof and the action which is proposed
to be taken with respect thereto, and (b)&nbsp;with computations
demonstrating compliance with the covenants contained in Section
8.;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.5. Notice of Litigation. Promptly after the commencement
thereof, notice of all actions, suits, and proceedings before any
court or governmental department,
commission, board, bureau, agency, or instrumentality,
domestic or foreign, affecting Borrower, which, if determined
adversely to Borrower, could have a material adverse effect on the
financial condition, properties, or operations of Borrower;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.6. Notice of Initial Defaults and Matured Defaults. As
soon as possible and in any event within five (5)&nbsp;days after the
occurrence of each Initial Default or Matured Default, a written
notice setting forth the details of such Initial Default or Matured
Default and the action which is proposed to be taken by the
Borrower with respect thereto;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.7. ERISA Reports. As soon as possible, and in any event
within thirty (30)&nbsp;days after Borrower knows or has reason to know
that any circumstances exist that constitute grounds entitling the
PBGC to institute proceedings to terminate a Plan subject to ERISA
with respect to Borrower or any commonly controlled Entity, and
promptly but in any event within two (2)&nbsp;Business Days of receipt
by the Borrower or any Commonly Controlled Entity of notice that
the PBGC intends to terminate a Plan or appoint a trustee to
administer the same, and promptly but in any event within five (5)
Business Days of the receipt of notice concerning the imposition of
withdrawal liability with respect to Borrower or any Commonly
Controlled Entity, the Borrower will deliver to the Bank a
certificate of the chief financial officer of the Borrower setting
forth all relevant details and the action which the Borrower
proposes to take with respect thereto;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.8. Reports to Other Creditors. Promptly after the
furnishing thereof, copies of any statement or report furnished to
any other party pursuant to the terms of any indenture, loan,
credit, or similar agreement and not otherwise required to be
furnished to the Bank pursuant to any other clause of this Section
6.;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.9. Proxy Statements, etc. Promptly after the sending or
filing thereof, copies of all proxy statements, financial
statements, and reports which each Borrower sends to its
stockholders, and copies of all regular, periodic, and special
reports, and all registration statements which Borrower files with
the Securities and Exchange Commission or any governmental
authority which may be substituted therefor, or with any national
securities exchange; and</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">16</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8.10. General Information. Such other information
respecting the condition or operations, financial or otherwise, of
Borrower as the Bank may from time to time reasonably request.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9. Environment. Be and remain in material compliance with the
provisions of all federal, state, and local environmental, health and
safety laws, codes and ordinances, and all rules and regulations issued
thereunder; notify the Bank immediately of any notice of a hazardous
discharge or environmental complaint received from any governmental
agency or any other party; notify the Bank immediately of any hazardous
discharge from or affecting its premises; promptly contain and remove the
same, in compliance with all applicable laws; promptly pay any fine or
penalty assessed in connection therewith; permit the Bank to inspect the
premises, to conduct tests thereon, and to inspect all books,
correspondence, and records pertaining thereto; and at the Bank&#146;s
request, and at Borrower&#146;s expense, provide a report of a qualified
environmental engineer, satisfactory in scope, form, and content to the
Bank, and such other and further assurances reasonably satisfactory to
the Bank that the condition has been corrected.</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.10. Operating Accounts. Maintain its primary operating accounts
at Bank.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11. Guarantee of Subsidiaries. Cause any future Subsidiaries of
Borrower to guarantee the Loan, and to execute any and all documentation
required by Bank to evidence same.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NEGATIVE COVENANTS. So long as any Notes shall remain unpaid or the
Bank shall have any Commitment under this Agreement or any letter of credit
issued in connection herewith, Borrower will not:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1. Negative Pledge. Create, incur, permit or suffer to exist any
Liens upon any of its assets or properties, now owned or hereafter
acquired, except for the Permitted Liens.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2. Debt. Create, incur, assume, or suffer to exist any Debt,
except:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;Indebtedness arising out of this Agreement;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;Purchase money indebtedness not to exceed $500,000 in the
aggregate for any given fiscal year;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;Current liabilities for taxes and assessments incurred in
the ordinary course of business;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;Indebtedness in respect of current accounts payable or
accrued (other than for borrowed funds or purchase money
obligations) and incurred in the ordinary course of business,
provided that all such liabilities, accounts and claims shall be
promptly paid and discharged when due or in conformity with
customary trade terms;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5)&nbsp;Debt described in Schedule &#147;5.12&#148; but no voluntary
prepayment, renewals, extensions, or refinancings thereof;</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">17</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6)&nbsp;Unsecured non-Bank Debt in addition to the debt described
in Schedule &#147;5.12&#148; not to exceed $100,000 for the Borrower in the
aggregate in any given fiscal year; and</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7)&nbsp;Accounts payable to trade creditors for goods or services
which are not past due more than ninety (90)&nbsp;days from the billing
date, in each case incurred in the ordinary course of business, as
presently conducted, and paid within the specified time, unless
contested in good faith and by appropriate proceedings.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3. Mergers, etc. Wind up, liquidate or dissolve itself,
reorganize, merge or consolidate with or into, or convey, sell, assign,
transfer, lease, or otherwise dispose of (whether in one transaction or
in a series of transactions) all or substantially all of its assets
(whether now owned or hereafter acquired) to any Person.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4. Leases. Without Bank&#146;s prior written consent, create, incur,
assume, or suffer to exist, any obligation as lessee for the rental or
hire of any real or personal property, except (1)&nbsp;leases existing on the
date of this Agreement and any extensions or renewals thereof and (2)
leases (other than Capital Leases) which do not in the aggregate require
Borrower to make payments (including taxes, insurance, maintenance, and
similar expenses which the
Borrower is required to pay under the terms of any lease) in any
fiscal year of Borrower in excess of One Hundred Thousand and no/100ths
Dollars ($100,000). Bank agrees not to unreasonably withhold its consent
and will endeavor to respond within ten (10)&nbsp;days to Borrower&#146;s request
therefor.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5. Sale and Leaseback. Sell, transfer, or otherwise dispose of
any real or personal property to any Person and thereafter directly or
indirectly lease back the same or similar property.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6. Dividends. Declare or pay any dividends; or purchase, redeem,
retire, or otherwise acquire for value any of its capital stock now or
hereafter outstanding; or make any distribution of assets to its
stockholders as such whether in cash, assets, or in obligations of the
Borrower; or allocate or otherwise set apart any sum for the payment of
any dividend or distribution on, or for the purchase, redemption, or
retirement of any shares of its capital stock; or make any distribution
by reduction of capital or otherwise in respect of any shares of its
capital stock.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7. Sale of Assets. Sell, lease, assign, transfer, or otherwise
dispose of, any of its now owned or hereafter acquired assets (including,
without limitation, shares of stock, receivables, and leasehold
interests), except: (1)&nbsp;inventory disposed of or leased in the ordinary
course of business; (2)&nbsp;the sale or other disposition of assets no longer
used or useful in the conduct of its business; and (3)&nbsp;treasury stock.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8. Guaranties, etc. Assume, guaranty, endorse, or otherwise be or
become directly or contingently responsible or liable (including, but not
limited to, an agreement to purchase any obligation, stock, assets,
goods, or services, or to supply or advance any funds, assets, goods, or
services, or an agreement to maintain or cause such Person to maintain a
minimum working capital net worth, or otherwise to assure the creditors
of any Person against loss), for obligations of any Person, except 1)
guaranties by endorsement of negotiable instruments for deposits or
collection or similar transactions in the ordinary course of business,
and 2) aggregate guarantees less than $100,000.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">18</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.9. Transactions with Affiliates. Enter into any transaction,
including, without limitation, the purchase, sale, or exchange of
property or the rendering of any service, with any Affiliate, except in
the ordinary course of and pursuant to the reasonable requirements of
each Borrower&#146;s business and upon fair and reasonable terms no less
favorable to the Borrower than would obtain in a comparable arm&#146;s-length
transaction with a Person not an Affiliate.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10. Fiscal Year. Not change its fiscal year end.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FINANCIAL COVENANTS. So long as any Notes shall remain unpaid or the
Bank shall have any Commitment under this Agreement, Borrower shall comply with
the following on a consolidated basis:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1. Funded Debt to EBITDA Ratio. Maintain at all times a Funded
Debt to EBITDA Ratio of not greater than 3.5 to 1.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2. Minimum Tangible Net Worth. Maintain at all times a Tangible
Net Worth of not less than Seven Million Five Hundred Thousand and No/100
Dollars ($7,500,000).</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3. Debt Service Coverage Ratio. Maintain at all times a Debt
Service Coverage Ratio not less than 1.25 to 1.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4. Capital Expenditures. Not make expenditures for fixed or
capital assets if, after giving effect thereto, the aggregate of all such
expenditures would exceed $900,000 during any fiscal year of the
Borrower.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EVENTS OF DEFAULT.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1. Events of Default. For purposes of this Agreement, the
occurrence of any of the following events shall constitute an &#147;Event of
Default&#148;:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;Borrower&#146;s failure to pay the principal of, or interest
on, the Notes, or any amount of a commitment or other fee within
five (5)&nbsp;days after the date on which any such payment is due and
payable;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;Borrower&#146;s failure, inability or admission in writing of
its inability generally to pay, its debts as such debts become due;
or;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;Borrower&#146;s making of an assignment for the benefit of
creditors, or its filing of an application for the appointment by
any tribunal of a custodian, receiver, or trustee for it or a
substantial part of its assets or the commencement of any
proceeding by or against Borrower under any bankruptcy,
reorganization, arrangement, readjustment of debt, dissolution, or
liquidation law or statute of any jurisdiction, whether now or
hereafter in effect in which an order for relief is entered or an
adjudication or appointment is made, and which remains undismissed
for a period of thirty (30)&nbsp;days or more, or the taking by Borrower
of any corporate action indicating its consent to, approval of, or
acquiescence in any such petition, application, proceeding, or
order for relief or the appointment of a custodian, receiver, or
trustee for all or any substantial part of its properties; or its
sufferance of</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">19</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">such custodianship, receivership, or trusteeship to
continue undischarged for a period of thirty (30)&nbsp;days or more.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;The rendering against Borrower of one or more judgments,
decrees, or orders for the payment of money in excess of Five
Hundred Thousand and no/100ths Dollars ($500,000.00) in the
aggregate, and the continuance of such judgments, decrees, or order
in effect for a period of thirty (30)&nbsp;consecutive days without
being vacated, discharged, satisfied, or stayed or bonded pending
appeal;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5)&nbsp;The occurrence of any of the following events and the
Borrower&#146;s failure to cure same to the Bank&#146;s reasonable
satisfaction within forty-five (45)&nbsp;Business Days after receiving
from the Bank written notice of the occurrence of such event and a
demand for its cure:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Any representation or warranty made by Borrower in
this Agreement or the Security Agreement or which is
contained in any certificate, document, opinion, or financial
or other statement furnished at any time under or in
connection with any Loan Document shall prove to have been
incorrect, incomplete, or misleading in any material respect
on or as of the date made or deemed made;</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Borrower&#146;s failure to perform or observe any term,
covenant, or agreement contained in this Agreement or any
Loan Documents;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Borrower&#146;s failure (i)&nbsp;to pay any indebtedness for
borrowed money (other than the Notes) or any interest or
premium thereon, when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise); or
(ii)&nbsp;to perform or observe any term, covenant, or condition
on its part required to be performed or observed under any
agreement or instrument relating to any such indebtedness,
when required to be performed or observed, if the effect of
such failure to perform or observe is to accelerate, or to
permit the acceleration of, after the giving of any
applicable notice or passage of time, or both, the maturity
of such indebtedness, whether or not such failure to perform
or observe shall be waived by the holder of such
indebtedness, or any such indebtedness shall be declared to
be due and payable or required to be prepaid (other than by a
regularly scheduled required prepayment) prior to the stated
maturity thereof;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;The Borrower shall (i)&nbsp;contest the validity or
enforceability of the Collateral documents (ii)&nbsp;deny that it
has any further liability or obligation thereunder, or (iii)
fail to perform any of its obligations thereunder;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;The Collateral documents shall cease, at any time
after their execution and delivery and for any reason, (i)&nbsp;to
create a valid and perfected first priority security interest
in and to the property purported to be subject to such
Collateral documents; or (ii)&nbsp;to be in full force and effect;
or shall be declared null and void;;</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">20</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;With respect to the Borrower and any commonly
Controlled Entity under ERISA, there shall occur or exist (i)
any Reportable Event or a complete or partial withdrawal
from any Multiemployer Plans; (ii)&nbsp;any Prohibited
Transaction; (iii)&nbsp;the filing of a notice of intent to
terminate a Plan or a Plan is terminated; or (iv)
circumstances which constitute grounds entitling the PBGC to
institute proceedings to terminate a Plan, or the PBGC&#146;s
institution of such proceedings; and in each case above, such
event or condition, together with all other events or
conditions, if any, could subject Borrower to any tax,
penalty, or other liability which in the aggregate may exceed
Two Hundred Fifty Thousand and no/100ths Dollars
($250,000.00); or</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;The Bank receives notice of a hazardous discharge or
an environmental complaint; or any federal, state, or local
agency asserts or creates a Lien upon any or all of the
assets, equipment, property, leaseholds, or other facilities
of the Borrower by reason of the occurrence of a hazardous
discharge or an environmental complaint; or any federal,
state, or local agency asserts a claim against Borrower
and/or its assets, equipment, property, leaseholds, or other
facilities for damages or cleanup costs relating to a
hazardous discharge or an environmental complaint; unless,
within five (5)&nbsp;Business Days of the occurrence giving rise
to the claim, (i)&nbsp;the Borrower can prove to the Bank&#146;s
satisfaction that the Borrower has commenced and is
diligently pursuing either: (x)&nbsp;a cure or correction of the
event which constitutes the basis for the claim, and
continues diligently to pursue such cure or correction to
completion or (y)&nbsp;proceedings for an injunction, a
restraining order, or other appropriate relief preventing
such agency or agencies from asserting such claim, which
relief is granted within ten (10)&nbsp;Business Days of the
occurrence giving rise to the claim and the injunction,
order, or relief is not thereafter resolved or reversed on
appeal; and (ii)&nbsp;in either of the foregoing events, the
Borrower has posted a bond, letter of credit, or other
security satisfactory in form, substance, and amount to both
the Bank and the agency or entity asserting the claim to
secure the proper and complete cure or correction of the
event which constitutes the basis for the claim;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">provided, however, that immediately upon the occurrence of any such
event the Bank may suspend its commitment to make advances under
the Revolving Line pending satisfactory cure of the default that
said event will constitute upon expiration of the time provided for
cure.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">Upon the occurrence of any of the foregoing Events of Default
under Section&nbsp;9.1(1), 9.1(2), 9.1(3) and 9.1(4) or 9.1(5), which is
not cured within the time provided for cure (if any), the Bank may
exercise any or all of the following remedies: (a)&nbsp;declare its
obligation to make loans to be terminated, whereupon the same shall
forthwith terminate; (b)&nbsp;declare the outstanding Notes, all
interest thereon, and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Notes, all
such interest, and all such amounts shall become and be forthwith
due and payable, without presentment, demand, protest, or further
notice of any kind, all of which are hereby expressly waived by the
Borrower. Additionally, the Bank is hereby authorized at any time
and from time to time, without further notice to</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">21</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">Borrower (any such
notice being expressly waived by the Borrower), to set off and
apply any and all deposits (general or special, time or demand,
provisional or final) at
any time held and other indebtedness at any time owing by the Bank
to or for the credit or the account of the Borrower against any and
all of the obligations of the Borrower now or hereafter existing
under this Agreement or the Notes or other Loan Documents,
irrespective of whether or not the Bank shall have made any demand
under this Agreement or the Notes or such other Loan document and
although such obligations may be unmatured. The rights of the Bank
under this Section are in addition to other rights and remedies
(including, without limitation, other rights of setoff) which the
Bank may have, in this Agreement, any other loan document or at law
or equity, including without limitation the right to accelerate the
Notes upon the occurrence of a Matured Default.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;MISCELLANEOUS.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1. Material Information: The Bank acknowledges that the Borrower
is a public company subject to state and federal securities laws and
regulations regarding the dissemination of material, non-public
information. The Bank also acknowledges that it will, from time-to-time
be in possession of material information about the Borrower&#146;s financial
condition or financial results which has not been disclosed publicly by
the Borrower; that the deliberate or inadvertent dissemination of such
information could cause irreparable harm to the Borrower; and it shall
use all reasonable care to safeguard such information from unauthorized
disclosure. Furthermore, to facilitate the Borrower&#146;s compliance with
Regulation&nbsp;FD, in the event that such information is disclosed, the Bank
agrees to notify Borrower of any disclosure of such information within 24
hours of the Bank&#146;s knowledge that such disclosure has occurred.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2. Amendments, etc. No amendment, modification, termination, or
waiver of any provision of any Loan Document to which the Borrower is a
party, nor consent to any departure by the Borrower from any Loan
Document to which it is a party, shall in any event be effective unless
the same shall be in writing and signed by the Bank, and then such waiver
or consent shall be effective only in the specific instance and for the
specific purpose for which given.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3. Notices, etc. All notices, consents, waivers, and other
communications under this Agreement must be in writing and will be deemed
to have been duly given when (a)&nbsp;delivered by hand (with written
confirmation of receipt), (b)&nbsp;sent by telecopier (with written
confirmation of receipt), provided that a copy is mailed by registered
mail, return receipt requested, or (c)&nbsp;when received by the addressee, if
sent by a nationally recognized overnight delivery service (receipt
requested), in each case to the appropriate addresses and telecopier
numbers set forth below (or to such other addresses and telecopier
numbers as a party may designate by notice to the other parties):</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If to the Borrower:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;XETA TECHNOLOGIES, INC.<BR></B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1814
W. Tacoma<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Broken
Arrow, OK 74012<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ATTN:
Robert Wagner, Chief Financial Officer<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Facsimile
No.: 918.664.6876</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">22</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If to Bank:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BANK OF OKLAHOMA, N.A.<BR></B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;P.O.
Box 2300<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tulsa,
Oklahoma 74192<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Attn:
Stephen R. Wright, Senior Vice President<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Facsimile
No.: (918)&nbsp;295-0400</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">or at such other address as shall be designated by such party in a
written notice to the other party complying as to delivery with the terms
of this Section&nbsp;10.2. Except as is otherwise provided in this Agreement,
all such notices and communications shall be effective when deposited in
the mails addressed as aforesaid, except that notices for advances to the
Bank pursuant to the provisions of &#167; 2.4 shall not be effective until
received by the Bank.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4. No Waiver. No failure or delay on the part of the Bank in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right,
power, or remedy preclude any other or further exercise thereof or the
exercise of any other right, power, or remedy hereunder. The rights and
remedies provided herein are cumulative, and are not exclusive of any
other rights, powers, privileges, or remedies, now or hereafter existing,
at law or in equity or otherwise.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5. Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the Borrower and the Bank and their
respective successors and assigns, except that the Borrower may not
assign or transfer any of its rights under any Loan Document to which the
Borrower is a party without the prior written consent of the Bank.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6. Costs, Expenses and Taxes. The Borrower agrees to pay on
demand all costs and expenses incurred by the Bank in connection with the
preparation, execution, delivery, filing, and initial administration of
the Loan Documents, including without limitation the fees of Riggs,
Abney, Neal, Turpen, Orbison &#038; Lewis, and of any amendment, modification,
or supplement to the Loan Documents, including, without limitation, the
fees and out-of-pocket expenses of counsel for the Bank, incurred in
connection with advising the Bank as to its rights and responsibilities
hereunder. If Bank is required to pursue enforcement action to collect
the Obligations due to a default by Borrower hereunder or under any of
the Loan Documents, Borrower also agrees to pay all costs, expenses and
fees, including court costs, incurred in connection with such enforcement
action, whether by negotiation, legal proceedings, or otherwise. In
addition, the Borrower shall pay any and all stamp and other taxes (but
not mortgage registration taxes where local law prohibits Borrower from
doing so) and fees payable or determined to be payable in connection with
the execution, delivery, filing, and recording of any of the Loan
Documents and the other documents to be delivered under any such Loan
Documents, and agrees to hold the Bank harmless from and against any and
all liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes and fees. This provision shall survive
termination of this Agreement.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">23</FONT>
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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.7. Integration. This Agreement and the Loan Documents contain
the entire agreement between the parties relating to the subject matter
hereof and supersede all prior and contemporaneous oral statements and
writings with respect thereto.</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.8. Indemnity. The Borrower hereby agrees to defend, indemnify,
and hold the Bank harmless from and against any and all claims, damages,
judgments, penalties, costs, and expenses (including attorney fees and
court costs now or hereafter arising from the aforesaid enforcement of
this clause) arising directly or indirectly from the activities of the
Borrower, its predecessors in interest, or third parties with whom they
have a contractual relationship, or arising directly or indirectly from
the violation of any environmental protection, health or safety law,
whether such claims are asserted by any governmental agency or any other
Person. This indemnity shall survive termination of this Agreement.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.9. Governing Law, Jurisdiction and Venue. This Agreement and the
Notes shall be governed by, and construed in accordance with, the laws of
the State of Oklahoma applicable to agreements made and to be performed
entirely within the State of Oklahoma, without giving effect to its
conflicts of laws provisions. The parties agree that, in any dispute
between them relating to this Agreement or the Notes, exclusive
jurisdiction shall be in the trial courts, Federal or State, sitting in
the City of Tulsa, Oklahoma, or in Tulsa County, Oklahoma, and that venue
shall lie only in such courts; and any and all objections as to such
jurisdiction and venue are hereby expressly waived by each party.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.10. Severability of Provisions. Any provision of any Loan
Documents which is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions of such
Loan Document or affecting the validity or enforceability of such
provision in any other jurisdiction.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11. Headings. Article and Section headings in the Loan Documents
are included in such Loan Documents for the convenience of reference only
and shall not constitute a part of the applicable Loan Documents for any
other purpose.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.12. Conflicts. To the extent any conflict exists under any of
the Loan Documents, this Credit Agreement shall be controlling.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="60%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">&#147;Borrower&#148;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2"><B>XETA TECHNOLOGIES, INC.</B></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">/s/ Robert B. Wagner</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Name
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Robert B. Wagner</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Title
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">CFO</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">24</FONT>
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<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="55%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">&#147;Bank&#148;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2"><B>BANK OF OKLAHOMA, N.A.</B></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;/s/ Stephen R. Wright</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Stephen R. Wright, Senior Vice President</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">25</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.6&#148;
</FONT>

<P align="center"><FONT size="2">(Borrowing Base Certificate)
</FONT>

<P align="center"><FONT size="2">26</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.7&#148;
</FONT>

<P align="center"><FONT size="2">(Corporate Borrowing Resolutions)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.32&#148;
</FONT>

<P align="center"><FONT size="2">(Mortgage)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.33&#148;
</FONT>

<P align="center"><FONT size="2">(Mortgaged Property)
</FONT>

<P align="left"><FONT size="2">Part of Lot One (1), Block One (1), GREENWAY BUSINESS PARK III, an Addition to
the City of Broken Arrow, Tulsa County, State of Oklahoma, according to the
Recorded Plat No.&nbsp;4796, being more particularly described as follows:
</FONT>
<P align="left"><FONT size="2">Beginning at a point 466 feet East of the Northwest corner of said Lot 1;
thence S 89&#176;53&#146;46&#148; E 643.85 feet; thence N 35&#176;58&#146;48&#148; E 170 feet; thence
Southeasterly 52.65 feet along a curve to the left with a radius of 717.36 feet
and a tangent bearing of S 54&#176;01&#147;12&#148; E; thence S 58&#176;13&#146;32&#148; E 156.16 feet;
thence Southeasterly 161.88 feet along a curve to the left with a radius of
441.39 feet; thence S 41&#176;03&#146;02&#148; W 393.26 feet; thence South 60.20 feet; thence
S 00&#176;02&#146;00&#148; W 263.30 feet; to a point on the North right-of-way line of West
Tacoma Street; thence continuing along said right-of-way the following: N
89&#176;55&#146;59&#148; W 155.22 feet; Northwesterly 118.36 feet along a curve to the right
with a radius of 276.21 feet; N 65&#176;20&#146;27&#148; W 14.17 feet; Westerly 137.44 feet
along a curve to the left with a radius of 320.21 feet; N 89&#176;55&#146;59&#148; W 260 feet;
Southwesterly 140.56 feet along a curve to the left with a radius of 540.65
feet; thence N 00&#176;18&#146;14: E 610.86 feet to the point of beginning.
</FONT>
<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.38&#148;
</FONT>

<P align="center"><FONT size="2">(Opinion of Borrower&#146;s Counsel)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.40(6)&#148;
</FONT>

<P align="center"><FONT size="2">(Permitted Liens)
</FONT>

<P align="left"><FONT size="2">General Electric Credit Corporation, under that certain Business Lease
Agreement No.&nbsp;4185891-001, evidenced by UCC Financing Statement no.
2003004178732, filed April&nbsp;9, 2003, in the UCC records of the County Clerk of
Oklahoma County, Oklahoma.
</FONT>
<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.47&#148;
</FONT>

<P align="center"><FONT size="2">(Real Estate Note)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.49&#148;
</FONT>

<P align="center"><FONT size="2">(Revolving Line Note)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.54&#148;
</FONT>

<P align="center"><FONT size="2">(Term Note)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;1.59&#148;
</FONT>

<P align="center"><FONT size="2">(UCC-1 Financing Statement)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;3.1&#148;
</FONT>

<P align="center"><FONT size="2">(Security Agreement)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;5.7&#148;
</FONT>

<P align="center"><FONT size="2">(Pending or Threatened Litigation)
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<P align="center"><FONT size="2">Schedule &#147;5.12&#148;
</FONT>

<P align="center"><FONT size="2">(Debt)
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp; Renewal Term Note &#150; May&nbsp;1, 2003, with U.S. Bank National
Association for $1,986,381.24 due December&nbsp;31, 2003
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp; Renewal Term Note &#150; May&nbsp;1, 2003, with Bank One, Oklahoma, NA
for $2,427,799.30 due December&nbsp;31, 2003
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(These two term notes are being replaced by the Term Loan with
BOk in the amount of $3,374,734.33)</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp; Renewal Real Estate Term Note &#150; May&nbsp;1, 2003, with Bank One,
Oklahoma, NA for $1,262,250.12 due December&nbsp;31, 2003
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp; Renewal Real Estate Term Note &#150; May&nbsp;1, 2003, with U.S. Bank
National Association for $1,032,750.00 due December&nbsp;31, 2003
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(These two real estate notes are being replaced by the Real
Estate Note with BOk in the amount of $2,238,333.48)
</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp; Renewal Revolving Note &#150; May&nbsp;1, 2003, with Bank One, Oklahoma,
NA for $4,125,000.00 due December&nbsp;31, 2003
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp; Renewal Revolving Note &#150; May&nbsp;1, 2003, with U.S. Bank National
Association for $3,375,000.00 due December&nbsp;31, 2003
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>
<TR valign="top">
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(These two revolving notes are being replaced by the Revolving
Note with BOk in the amount of $7,500,000.00)</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp; Lease Agreement with Avaya Financial Services, 1 CIT Drive,
Livingston, NJ 07039; Lease #X562270, Schedule #00030; 12&nbsp;monthly lease
payments of $21,416.26 secured by equipment installed at GMAC, One
National General, Hazelwood, MO 63045 (Xeta Customer location).
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>




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