ELCOM INTERNATIONAL INC
EXHIBIT 10.45-DPA TERMS HOLDINGS
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>8
<FILENAME>form10k_ex1045.txt
<DESCRIPTION>EXHIBIT 10.45-DPA TERMS HOLDINGS
<TEXT>

                     LLOYDS TSB COMMERCIAL FINANCE LIMITED


                          STANDARD TERMS AND CONDITIONS


                                     FOR THE


                                PURCHASE OF DEBTS

                                 INCORPORATED IN


                            DEBT PURCHASE AGREEMENT

<PAGE>

                               INTRODUCTION

1.1A number of words and phrases used in the Debt  Purchase  Agreement and these
Conditions have special meanings. These are explained in Condition 21.

1.2  The  Debt  Purchase  Agreement  may  be  entered  into  in  any  number  of
counterparts,  each of which when  executed and  delivered  may be treated as an
original.

                    PURCHASE PRICE, TITLE AND TRUST OF DEBTS

2.1The Purchase Price of each Debt shall be its Net Value.

2.2Upon written  request,  you will execute and deliver to us at your reasonable
expense, in such form as we may reasonably require, duly stamped assignments, or
such other  documents  as we may require  formally  transferring  to us title to
Debts or Related  Rights vested in us. You will do such other acts and things as
we may  reasonably  require  to carry out the  purposes  and  intent of the Debt
Purchase Agreement.

2.3If,  for any reason  whatsoever,  a Debt or its Related  Rights shall fail to
vest in us in  accordance  with  clause  D.2 or  under  an  Assignment  or other
document  executed pursuant to Condition 2.2 then you will hold such Debt or its
Related Rights in trust for us.

                              NOTIFICATION OF DEBTS

3.1On the Commencement  Date you will deliver to us an Offer detailing all Debts
(except Non- Notifiable Debts) together with details of all credit notes (except
those clearly  appropriated  to Non-  Notifiable  Debts) issued by you. You will
also advise us of any other  matters  which may cause the Notified  Value of any
Debts to be  reduced  or  extinguished.  In respect of the Debts that we wish to
purchase we will  accept your Offer by  crediting  their  Notified  Value to the
Sales Ledger Control Account in our books.

3.2 In respect of each Debt coming into existence  after the  Commencement  Date
(other  than a Non-  Notifiable  Debt)  you will  include  it on a  Notification
Schedule, provided it has not already been Notified to us, together with details
of a ll relative  credit notes issued by you (except those clearly  appropriated
to Non-Notifiable Debts). You will also advise us of any other matters which may
cause the Notified Value of any Debts to be reduced or extinguished.

                              NON-NOTIFIABLE DEBTS

4.1Until  we give you  written  notice  to the  contrary,  you will not  deliver
Notification Schedules relating to the following classes of Debts:

(a)Debts due from a director or shareholder or employee of yours;

(b)Debts due from any other person  whose  relationship  to you falls within the
meaning of "associate" as defined by s.184of the Consumer Credit Act 1974;

(c)Debts due from the sale of any of your capital assets;

(d)Debts which are not due in respect of your  Customer's  trade,  occupation or
profession;

(e)Debts where the Customer does not have an established place of business;

(f)Debts  arising  under  a hire  purchase,  leasing  or  consumer  credit  sale
agreement;

(g)Debts due in respect of Goods delivered on sale or return or on approval;

(h)Debts arising under any Contract of Sale involving  progress payments or RIBA
or JCT or  similar  terms  where  payment is  required  prior to  completion  or
performance of the Contract of Sale;

(i)Debts  arising  under any  Contract  of Sale with a Ministry,  Department  or
Agency of the Crown;

(j)Debts  arising under any Contract of Sale with a Customer who supplies  goods
or  services  to you and which may  therefore  be subject to rights of set- off,
contra accounting, defence or cross-claim;

(k)those  additional Debts referred to in the General  Particulars as Additional
NonNotifiable Debts.

4.2 We may at any time, upon written  notice,  require you thereafter to deliver
Notification  Schedules in respect of any Debts or classes of Debts  referred to
in condition 4.1.

4.3We shall only make a Service  Charge in respect of any  Non-Notifiable  Debts
after we have given you notice under condition 4.2.

                               AGENCY APPOINTMENT

5.1We  appoint  you as our agent,  at your  expense,  to  administer  Customers'
accounts and procure the  collection  of Debts for our benefit.  You accept such
appointment  and will act promptly and  efficiently  in carrying out your duties
and such instructions in respect of them as we may give.

5.2Where in the  General  Particulars  of the Debt  Purchase  Agreement  we have
stated  that no notice of  Assignment  is  required  to be given  then,  for the
moment, neither you nor us will notify your Customers of our ownership of Debts.
However,  we may at anytime  give such  notice to any or all of your  Customers.
Alternatively,  we may require you to notify your Customers of your  appointment
as our agent to collect Debts Vested in us.

5.3Where in the General  Particulars  of the Debt  Purchase  Agreement it states
that  notice  of  Assignment  of Debts and of your  appointment  as our agent to
collect Debts will be given then the Debt Purchase Agreement shall be treated as
if we had on the  Commencement  Date served a notice on you under  condition 5.2
requiring you to give to all or any of your Customers the notices referred to in
that condition.

5.4The  notices to Customers  referred to in conditions  5.2 and 5.3 shall be in
such form and  contained  in or endorsed on such  documents  as we may  specify,
including invoices and statements of account.

<PAGE>

5.5We may, at any time,  by written  notice to you terminate in whole or in part
your agency  referred to in condition  5.1 in respect of the Debts  specified in
such notice.

                               COLLECTION OF DEBTS

6.1You  will  ensure  that a bank  account  is  opened  that  complies  with the
definition  of a Trust  Account in  Condition  21.  Until  notice from us to the
contrary you will,  immediately  upon receipt,  pay into the Trust Account,  the
identical cash, or other remittance or instrument received in or towards payment
of a Debt Vested in us,  including  remittances and instruments  made payable to
us.  Alternatively,  if we so  require  you will  deliver to us or pay into such
other bank  account as we may  nominate  all such cash or other  remittances  or
instruments  endorsing  the same  where  necessary.  You will  keep any  payment
received by you as our agent,  pending  payment into the Trust Account or to any
other account nominated by us, separate from your own money and hold the same on
trust for us. All  balances in the Trust  Account  shall be held on trust for us
and you will notify the relevant bank of such trust.

6.2  Following  our  cancellation,  in  whole  or in  part,  of your  agency  to
administer Customers' accounts or to collect Debts for us:

(a)we may give immediate notice to the relevant Customers of our interest in the
Debts and their Related  Rights and instruct them to pay or deliver  directly to
us;

(b)you  will  confirm to your  Customers  the effect of any notice  given  under
condition 6.2(a);

(c)we may, at your reasonable expense, administer Customers' accounts;

(d)subject to condition  6.2(e),  we shall have the sole and unfettered right to
collect and enforce  payment of Debts in whatever  way we think fit;  without in
any way  limiting  our rights,  we may  institute,  carry on or defend any legal
proceedings:

     (i)in any part of the world; and

     (ii)whether in your or our name; and settle  compromise or adjust any claim
     brought by or against us, upon such terms as we see fit;


(e) we will not collect or enforce payment of Debts in our name unless:

     (i)we have first  required  you,  under  condition  5.2,  to give notice of
     Assignment; or

     (ii)under  condition 5.2 we shall be treated as having required you to give
     notice of Assignment;

(f)we shall be under no obligation to institute or defend any proceedings, by or
against us, relating to any Debt or Related Right;

(g)you  will,  at your  expense,  co-operate  with us to secure  collection  and
enforcement  of Debts and Related  Rights,  including the provision of witnesses
and evidence;

(h)we, or our agents, may enter into your premises (or such other premises where
the Goods may be  located  or  services  are to be  performed)  and  perform  or
complete any Contract of Sale or any collateral contract;

(i)we may charge you a fee of 7.5% of the Notified  Value of Debts unpaid at the
time of  cancellation  of  your  agency  or  which  shall  come  into  existence
thereafter;

(j)you  will be  bound by any act or  omission  of ours in the  exercise  of our
rights  pursuant to any of sub- clauses 6.2 (a) to (h)  including  any reduction
in, or extinction of, the Purchase Price.

                               DEBT CLASSIFICATION

7.1 We shall classify all Notified Debts as either Approved or Disapproved.

7.2 Without  notice to you, we shall treat as a  Disapproved  Debt any  Notified
Debt (including any previously classified as an Approved Debt):

(a)in relation to which you are in breach of any warranty or  undertaking  given
to us; or

(b)which is disputed by a Customer or any third party; or

(c)which is a Non-Notifiable Debt; or

(d)which when  aggregated with all other unpaid Debts exceeds the Funding Limit;
or

(e)in  respect  of which we are  entitled  to give you notice of  repurchase  in
accordance with conditions 16.1 and 16.2, even though we may refrain from giving
such notice; or

(f)which,  on the  Commencement  Date,  is overdue by more than 60 days (or such
other period as we may specify); or

(g)which is not paid by the date specified in the relevant Financial Particulars
on which an Approved Debt will automatically become a Disapproved Debt.

7.3We may give you notice, at any time, of any other Debt which we may designate
as a Disapproved Debt, even if previously classified as an Approved Debt.

7.4Any  Debt  not  designated  by  us  as  a  Disapproved   Debt  shall,   until
such designation, be treated as an Approved Debt.

7.5Wemay  establish  debtor  limits in  relation to any of your  Customers.  The
result will be that even though Debts may be  classified  as Approved your right
to make  withdrawals  under  condition  9.2 shall be restricted by the amount of
such debtor limits.

                                  OUR SERVICES

8.1For the Service Charge  specified in the Financial  Particulars we will carry
out the following services relative to Notified Debts for you at your request or
at any other time

<PAGE>

should we so decide:

(a)advice as to improvements  to your  collection  procedures and assessing your
need for credit insurance;

(b)general  advice on standard  sales  contracts,  terms of payment,  the use of
settlement  discounts,  evaluating the effect of changing  invoicing methods and
terms;

(c)provision of statistical information based upon Debts Notified to us;

(d)advice on export debtor  procedures  and the specific  requirements  of major
trading countries where we have arrangements with correspondents;

(e)assisting  in the review of the general terms and  conditions of suppliers in
relation to their reservations of title;

(f)advising on your relationship with your bankers;

(g)reconciliation of your monthly sales ledger position;

(h)advice upon your need for foreign exchange facilities or contingent liability
cover;

(i)daily information as to the status of your accounts with us;

(j)monitoring   the  operation  of  the  Trust  Account,   including   detailing
dishonoured cheques or other defects in payment;

(k)liaising with solicitors instructed to collect Debts;

(l)inspecting your books and records relating to Debts, including:

     (a) general systems;
     (b) maintenance of sales ledger;
     (c) dunning cycles;
     (d) overdue debts;
     (e) control systems.

The  provision  of  any  of  the  services  in  this   Condition  8.1  shall  be
without responsibility on our part to the fullest extent permitted by law.

                              FUNDS IN USE ACCOUNT

9.1We  shall  operate  an account  in your name  designated  as the Funds In Use
Account.

9.2Prior to the  Collection  Date for an Approved  Debt, you will be entitled to
withdraw from us amounts on account of the Purchase  Price, up to the lesser of:
(i)the  equivalent  of the Initial  Payment  Percentage,  shown in the Financial
Particulars, of the Notified Value of each Approved Debt; and

(ii)the Funding Limit shown in the Financial Particulars.

Such withdrawals shall be debited to the Funds In Use Account.  Should it become
apparent  that the Notified  Value of a Debt exceeds its expected Net Value then
you will promptly repay the difference to us.

If as a consequence of our disapproval of an existing  Approved Debt the account
becomes  overpaid,  then  recovery of the  overpaid  element will be from future
invoices and cash, in the first instance.

9.3We may terminate your right to withdraw,  from the Funds In Use Account prior
to the  Collection  Date,  monies on account of the  Purchase  Price of Approved
Debts:-

(a)at any time after a Termination  Event  (whether or not we exercise the right
of termination); or

(b)following  the period of notice to  terminate  by either of us allowed by the
Purchase Agreement

9.4We may at anytime, by written notice to you, with immediate effect vary:

(i)the Initial Payment  Percentage in respect of all un recovered Approved Debts
or such Debts afterwards notified; or

(ii)the Funding Limit

and if the debit  balance on the Funds in Use  Account  thereafter  exceeds  the
Funding Limit, you will immediately upon demand pay to us the excess.

9.5We shall debit to the Funds in Use Account:

(i)the amount of all payments made to you,  including  withdrawals on account of
the Purchase Price under condition 9.2;

(ii)all Fees and Charges;

(iii)value added tax;

(iv)any sums actually, contingently or prospectively payable by you to us;

(v)an amount equivalent to any unexpired guarantee, given by us at your request,
in respect of your obligations to any other party.

9.6 We shall credit to the Funds in Use Account:

(i)on the Collection Date, an amount  equivalent to all remittances  received in
or towards the discharge or settlement of Debts;

(ii)any Allowance;

(iii)all  payments  received in or towards the discharge of the repurchase price
of Debts  calculated in accordance  with Condition 16.3 after first debiting the
same to the sales ledger control account.

9.7 Where the Financial  Particulars  envisage that you may notify us of Foreign
Debts or NonSterling  Domestic  Debts,  we may maintain Funds in Use Accounts in
either the currencies of those Debts or in any other currency agreed between us.

                               OUR OTHER ACCOUNTS

<PAGE>


10.1 Apart from the Funds in Use Account,  we shall maintain such other accounts
as we consider necessary.

10.2We shall maintain a Sales Ledger Control  account to which shall be credited
all Debts at their Notified Value but subject, if necessary, to later adjustment
to their Net Value.

10.3 There shall be debited to our Sales Ledger Control account:

(a)the Notified Value of credit notes;

(b)the amount of payments received in or towards the discharge of Debts;

(c)the value of any discounts taken or allowed;

(d)the  repurchase  price of any Debt  subject to a notice of  repurchase  under
condition 16;

(e)the difference between the Notified Value of Debts and their Net Value;

(f)such other debit adjustments as we may from time to time reasonably  consider
to be necessary.

10.4Where,  in the  negotiations  leading to the  signing  of the Debt  Purchase
Agreement,  Foreign Debts or Non-Sterling Domestic Debts were not envisaged, and
the same are  Notified to us, we shall be entitled to adjust the Service  Charge
to compensate  for the additional  work involved and a reasonable  profit margin
thereon. At our discretion, we may make all payments, debit all Fees and Charges
and credit all receipts in the currency of such Debt or in Sterling.

10.5Copies of statements relating to the Sales Ledger Control account,  Funds In
Use  Accounts  and any other  accounts  between us or  relating to Debts will be
delivered to you at regular  intervals.  Unless you notify us, within 30 days of
our  despatch,  that any item is incorrect  then those  accounts will be binding
upon you,  except for  manifest  error or error of law.  In any  proceedings  or
claim, you will accept and be bound by a certificate by our Company Secretary as
to amounts due and owing by either of us.

10.6You irrevocably  authorise us to pay to a Customer a sum equal to any credit
balance on that Customer's account, however it arises.

                              OUR FEES AND CHARGES

11.1For the services to be supplied by us, you will pay to us the following fees
and charges which are set out in the Debt Purchase Agreement:

(a)the Arrangement Fee;

(b)the Service Charge,  for your right to request us to provide the services set
out in Condition  8.1; our  entitlement  to or the a mount of the Service Charge
shall  neither be  affected  by your  failure to request  any service nor by the
subsequent  issue of a credit  note by you, or the issue of a debit note by your
Customer;

(c)a sum equal to the  deficiency  (if any) between any Minimum  Annual  Service
Charge for any permitted currency  (including  Sterling) and the total amount of
all Service Charges paid in such currency in any period of 12months, expiring on
the anniversary of the first day of the first month  following the  Commencement
Date;

(d)the Discount Charge;

(e)the Funds Transmission Charge, in respect of each payment made to you;

11.2 You will pay us any costs,  charges or  expenses  incurred  in opening  and
maintaining the Trust Account.

11.3  Value  Added  Tax,  where  applicable,  shall be added to all our Fees and
Charges.

11.4We  may a tour  discretion  require  a pro  rata sum to be paid  monthly  on
account of the Minimum Annual Service Charge. If the Debt Purchase  Agreement is
terminated  either by us following a Termination  Event or by you giving us less
than the required notice period,  which in our discretion we may accept, then we
may (in addition to the Minimum Annual Service Charges accrued,  paid or payable
under  Condition  11.1 (b) and  (c)charge  you a sum  equivalent  to the Minimum
Annual Service  Charge,  together with a sum equal to the estimated net Discount
Charge for the unexpired period of the Agreement.

11.5The  Discount  Charge will be calculated  daily,  at the rate set out in the
Financial  Particulars,  on any daily debit  balance on the Funds in Use Account
(as adjusted  below) and will be debited  monthly in arrears to the Funds in Use
Account.

11.6 The Allowance will be calculated  daily at the rate set out in the relevant
Financial  Particulars,  on any daily credit balance on the Funds in Use Account
(as adjusted below) and will be credited  monthly in arrears to the Funds in Use
Account.

11.7 If, at any time, the debit balance on the Funds in Use Account  exceeds the
Funding  Limit then we may notify  you in  writing of our  intention  thereafter
permanently to increase our Fees and Charges to reflect our increased risks. The
exercise  of this  right  shall not  prejudice  our  right to  demand  immediate
repayment of the amount by which the Funding Limit is exceeded.

11.8 For the purposes of calculating  the Discount  Charge and the Allowance any
sum recovered in or towards  discharge of a Debt shall be treated as credited to
the Funds in Use Account on its Collection Date.

                              EXPENSES AND SET OFF

12.1 You will pay us,  on the basis of a full  indemnity,  all  costs,  fees and
expenses (including reasonable legal fees) incurred by us in:

(a)negotiating, entering into, preserving or enforcing our rights under the Debt
Purchase Agreement and any ancillary or collateral agreement;

<PAGE>

(b)collecting  or  attempting to collect,  settle or compromise a Debt,  dealing
with disputes or in dealing with or disposing of Related Rights;

(c)obtaining any release of Debts, or waiver of rights, from any Encumbrancer;

12.2You will be  responsible  for all stamp duties  payable on  Assignments  and
reassignments or other instruments  transferring title (whether to you or us) to
the Debts, Related Rights or Goods.

12.3 If we provide  services to a level or intensity which were not envisaged by
us at the time of entry into this  agreement  then,  in  addition to the Service
Charge,  we may make a reasonable  charge for all costs and expenses  (including
the cost of our management time and resulting loss of profit) for providing such
services.

12.4 If we purchase a Debt  expressed in a currency other than sterling then you
will be responsible to us for all bank charges and  commissions  for collections
and currency conversions.

12.5We may at any time set off your liability to us against our liability to you
and/or combine any accounts  recording  transactions  between us, whether or not
arising under the Debt Purchase  Agreement.  In order to effect such set off, or
combination  of  accounts,  we may  convert  currencies  at the rate of exchange
prevailing at the time of set off or combination. You may not exercise any right
of set off or counterclaim against monies due from you to us.

                            YOUR RECORDS AND REPORTS

13.1You will  maintain a monthly open item ageing  analysis,  in such form as we
may require,  showing the position of each Customer's account on the last day of
each month, including details of any outstanding credit balances. All ledgers of
Debts and records of Related Rights shall bear  conspicuous  notations that they
belong to us.

13.2 You will supply to us (or at our option make  available  for  inspection by
us) the  following  documents  and/or  information  in whatever form they may be
stored:

(a) forthwith or as soon as reasonably practicable upon our request:

(i)all  invoices  relating  to Debts  and all debit  and  credit  notes or other
documents evidencing how Debts are reduced, paid or otherwise satisfied;

     (ii)the full terms of any Contract of Sale;

     (iii)proof of the complete performance of each Contract of Sale

     (iv)evidence of any Related Right; and

     (v)such other information and evidence as we may require relating to Debts,
     Related Rights or Contracts of Sale;

(b)daily: a report detailing monies collected by you as our agent;

(c)within  10  calendar  days of the end of the  month to which  they  relate or
forthwith upon our request copies of:

     (i)your open item ageing analysis referred to in condition13.1;

     (ii)your sales ledger control;

     (iii)your purchase ledger;

(d)within one month (or other such period as we may  reasonably  specify) of the
end of the month to which they relate: your monthly management accounts;

(e)within  four  months  of the  end of  your  financial  year:  copies  of your
annual audited (and, if applicable, consolidated) accounts;

(f)within a  reasonable  time of our  request:  any other  information  relating
to your business or affairs.

13.3You  will allow us, or our  representatives  or agents,  at any time  during
business  hours, to enter upon your premises (or any premises where you carry on
business or store any goods or records  relating to your business) to verify any
of the information or documents required be supplied under to condition 13.2 or,
at your  expense,  to remove  and/or  copy  (including  copying to disk)  books,
ledgers, orders, correspondence, bank statements, and other documents or records
and any items comprised in the Related Rights.

13.4Should there be any breach of conditions 13.1 to 13.3 inclusive then without
prejudice to any other rights in our favour, we may immediately appoint, at your
expense,  accountants  or other  professional  persons to obtain or provide such
information as we may require.

                   YOUR WARRANTIES, UNDERTAKINGS AND INDEMNITY

14.1 You warrant to us that:

(a)except as disclosed to us in writing prior to the  Commencement  Date,  there
are no Encumbrances affecting the Debts;

(b)you have  disclosed to us every  material  fact or matter which you know,  or
ought to have known, might influence us in deciding whether or not to enter into
this  agreement or to classify any Debt as Approved or  Disapproved or to accept
any person as an indemnifier or guarantor;

(c)all  reports,  accounts,  records,  data and  information  supplied to us are
accurate and complete;

(d)there is no agreement for the sale or charge of the Debts to any other party.

14.2The  warranty in condition  14.1(b) includes but is not limited to, any past
Insolvency of your directors or

<PAGE>

shareholders  or of any  company  in which they have been  interested  or of any
disqualification  at any time of any of your  directors or any shadow  directors
(as defined by the Insolvency Act 1986) from acting as a director.

14.3Each of the warranties set out in condition 14.1shall be treated as repeated
by you each time that you submit a Notification Schedule to us.

14.4 In relation to each Debt referred to in a Notification  Schedule,  you will
be treated as warranting that:

(a)the respective Contract of Sale:

     (i)is valid and enforceable against the Customer;

     (ii)is governed by English law or such other law approved by us in writing;

     (iii)provides for the Customer to submit to the jurisdiction of the English
     Courts; and

     (iv)does not include any prohibition  against  Assignment of the Debt or of
     the Contract of Sale;

     (v)provides  for  payment  in  Sterling  or an  Approved  Foreign  Currency
     referred to in the Financial Particulars;

     (vi)provides  for terms of payment not more  liberal  than those set out in
     the General Particulars.

(b)the  Customer (or the person having the duty to  administer  the estate of an
Insolvent  Customer)  will pay not less than the Notified Value of the Debt (but
allowing,  if agreed, a prompt payment discount not exceeding five per cent) not
later than the Settlement Date;

(c)noright  of  set-off or  counterclaim  exists or will exist in respect of the
Debt;

(d)there will be no dispute by the Customer (whether justifiable or not);

(e)prior to  performance  of the Contract of Sale, you have taken all reasonable
steps to ascertain the credit  worthiness of the Customer and have advised us of
any adverse information known to you;

(f)the Debt is not a Non-Notifiable Debt;

(g)the Goods, free of Encumbrances, have been Delivered;

(h)you  have  no  obligations  to  your  Customer  and  there  are no  contracts
between you and your Customer, other than Contracts of Sale;

(i)to the extent  referred  to in the  invoice,  the  Contract  of Sale has been
performed and the Debt has become due;

(j)the Debt has not been previously Notified to us;

(k)the relevant invoice bears notice of Assignment of the Debt to us in the form
required by us, should you be obliged to give such notice to your Customers;

(l)the Debt has not been sold,  assigned  or charged to any other  person and is
free from Encumbrances.

14.5In respect of each Debt referred to in a Notification  Schedule, you will be
treated as undertaking to us that:

(a)the  warranties given upon Notification of a Debt will remain unaltered until
full discharge of the Debt;

(b)you  will  advise  us as  soon  as  reasonably  practicable  of  any  adverse
information  which  subsequently  becomes  known  to you  affecting  the  credit
worthiness of the Customer;

(c)you will promptly  perform all your further or continuing  obligations  under
the  relevant  Contract  of Sale,  whether  or not  relating  to the  repair  or
maintenance of goods,  the provision of drawings,  documents or information,  or
the performance of other services or obligations;

(d)you will not extend time for payment of the Debt nor waive,  modify,  rescind
or terminate the relevant Contract of Sale;

(e)without  prejudicing  our rights in  relation  to your  warranties,  you will
notify us promptly of:

     (i)any dispute  (whether  justifiable or not) between you and the Customer;
     or

     (ii)any claims by the Customer to set-off or counterclaim against the Debt;
     or

     (iii)any credit to which a Customer is entitled;

(f)you will promptly resolve all your Customer's disputes and claims;

     (g)where  you  are  required  to  give  notice  to  your  Customers  of the
     Assignment  to us of the Debt,  each  statement  of account  will bear such
     notice in the form  required by us;  (h)you  will ensure that each  invoice
     contains  details of your payment terms set out in the General  Particulars
     and not vary them without our consent.

14.6 You undertake to us that you will:

(a)maintain  insurance  against  loss  (however  that may arise) of the  Related
Rights and books and records relating to Debts and Contracts of Sale;

(b)fully  comply  with all  legislation  which  relates  to you or any  business
carried on by you;

(c)comply  with  the  requirements  of the  Companies  Act 1985 and all laws and
binding  directives  relating to the protection of the environment  and/or human
health;

(d)advise us immediately of your becoming  aware of any

<PAGE>

breach of the legislation referred to above or upon receipt of any notice served
upon you alleging any such breach;

(e)carry out such procedures as we may reasonably require in relation to the day
to day administration of the Debt Purchase Agreement;

(f)immediately notify us if you contemplate taking any action which might result
in your Insolvency or if you are aware of any such action being  contemplated by
any other party;

(g)promptly  disclose to us details of any change or contemplated  change in the
control or ownership of your company or business;

(h)promptly  disclose all facts and matters which in any way might reasonably be
expected to influence our decision as to the  continuance  of this  agreement or
the establishment, cancellation or variation of any limit;

(i)not disclose to any person information  provided by us relating to the credit
worthiness  of Customers or details of, or the reasons for, our  designation  of
Debts as Approved or Disapproved;

(j)give our bankers such instructions or indemnities as they may require for the
collection of non transferable instruments made payable to you;

(k) instruct your bankers to transfer to the Trust Account all credit  transfers
received by you;

(l)not hold yourself out as our agent except as provided for in condition 5 and,
following termination of such agency, not hold yourself out as our agent for any
purpose;

(m)if  notice is given not to issue any  credit  notes then none shall be issued
unless expressly agreed by ourselves;

(n)ensure that your Customer  records of account  prominently  indicate that the
Debts have been assigned to us;

(o)provide us with such security as we may from time to time reasonably  require
for the  performance  of your  obligations  to us,  including  charges over your
assets;

(p) save as agreed by us in writing  not create  any  Encumbrance  over Debts or
your rights under this  agreement,  nor offer to factor or discount the Debts of
any other part or your business, other than to us;

14.7 You agree to indemnify us against any loss or reasonable  expense,  present
or contingent, which we may suffer or incur or monies paid as a result of:

(a)any breach of your warranties, obligations or undertakings to us; or

(b)our accepting and/or acting upon instructions purporting to come from you and
given by telephone,  facsimile,  telex,  computer or electronic  means, if those
instructions  subsequently  prove to have been incorrect or  unauthorised by you
(except to the extent that our officers have been negligent or fraudulent); or

(c)our  collecting  and/or crediting to your account with us any cheque or other
negotiable instrument payable to you or endorsed in your favour; or

(d)our honouring any guarantee or indemnity given in respect of your obligations
to any other party.

                             IMMEDIATE TERMINATION

15.1 We may  immediately  terminate  the Debt  Purchase  Agreement by giving you
written  notice upon or at any time after the occurrence of any of the following
events:

(a)your  becoming  Insolvent,  or any step is taken which  could  result in your
becoming Insolvent;

(b)your committing or threatening to commit any breach of this agreement;

(c)any  person who, or company  which,  has given us a guarantee or indemnity or
granted a  security  interest  in  respect of your  obligations  to us  (however
arising)  dying or becoming  Insolvent  or giving or  attempting  to give notice
terminating, amending or withdrawing such guarantee, indemnity or security;

(d)there  shall be any change in your  overall  financial  condition  or in your
operating performance, which we reasonably determine to be materially adverse;

(e)without our prior written  consent,  there shall be a material  change in the
composition of your Board of Directors or senior management or any change in the
ownership  of 10 per cent or more of your shares or there shall be any change in
your control;

(f)we reasonably consider there to be a deterioration in your overall management
and control or in your general day today  administration  and organisation or in
your sales ledger, administration or credit control procedures;

(g)any  Encumbrancer,  having  waived  or  released  its  rights to the Debts or
Related Rights, withdrawing or attempting to withdraw, such waiver or release or
otherwise asserting any interest adverse to us in Debts or Related Rights Vested
in us.

15.2Following   termination  of  the  Debt  Purchase  Agreement,  you  will  not
thereafter  deliver  Notification   Schedules  relating  to  Debts  coming  into
existence after  termination and we shall have no obligation in respect of them.
Apart  from  any  matters  specifically  mentioned  as  arising  on  or  out  of
termination,  the rights and obligations of each of us in relation to or arising
out of Debts  Vested in us prior to  termination  shall not be  affected by such
termination.

                                   REPURCHASE

16.1We may, by written notice,  require you immediately to repurchase all or any
Debts relating to a Customer:

(a)who is Insolvent; or

(b)who fails to pay the Notified Value of a Debt (less any

<PAGE>

prompt payment discount not exceeding 5%) by the Settlement Date; or

(c)in respect of whom solicitors or any collection agent have been instructed to
collect any Approved Debt; or

(d)in  respect of whose Debts you are in breach of any warranty  given by you to
us.

16.2 We may, by written notice, require you immediately to repurchase all or any
Debts following:

(a)the expiry of any notice to terminate this agreement; or

(b)a Termination Event, whether or not we terminate the agreement.

16.3 The repurchase  price payable by you to us for a Debt shall be the Notified
Value of the Debt plus all relative  Fees and Charges less all sums  received in
or towards discharge of the Debt.

16.4Any  notice  to  repurchase  under  condition  16.2  shall be given  without
prejudice to all other rights in our favour however arising.

16.5  If  we  require  you  to  repurchase  all  Debts  vested  in us  then  for
administrative  convenience,  we may treat their  repurchase  price as satisfied
when a sum equal to the debit  balance  on the Funds in Use  Account  shall have
been paid to us. Upon such discharge of the repurchase  price in accordance with
this condition we shall have no further liability to you for the Purchase Price.
Payment of the repurchase price shall not affect our entitlement to any Fees and
Charges debited thereafter.

16.6Upon payment of the repurchase price of all Debts which we have required you
to  repurchase  (and not  otherwise)  our rights in relation to those Debts will
vest in you. We will,  if  requested by you, at your  expense,  execute a formal
re-assignment to you of the Debts so repurchased and give written notice of such
repurchase to your Customers.

                                 COMMUNICATIONS

17.1You irrevocably authorise us to:

(a)(subject  to  providing  you with copies)  provide  your bankers  (which term
includes  any bank with which you may have or have had an  account),  Lloyds TSB
Group Plc or any of its  subsidiaries or your auditors and accountants with such
information as they may require in relation to your business and affairs and the
operation and effect of this agreement;

(b)obtain from your bankers or Lloyds TSB Group Plc or any of its  subsidiaries,
with whom you have accounts,  or your auditors and accountants  such information
as we may require;

(c)obtain from your Customers  their consent to taking of references  from their
bankers.

17.2 You confirm that you have authorised your bankers, auditors and accountants
to give us such information as we may require.

17.3 Any communication or Notification Schedule made or sent to us by you or any
of your employees or agents whether written or oral  (including  notices sent by
facsimile  or  other  electronic  means)  will be  binding  upon  you and may be
accepted by us in spite of the absence  of, or any defect in, the  authority  of
any such employee or agent.

                          PARTNERSHIPS AND SOLE TRADERS

18.1  Where  you  are  constituted  as a  partnership,  the  provisions  of this
condition 18 shall additionally apply.

18.2Yourundertakings  and warranties contained in this agreement shall be deemed
to be given by each of you. Your obligations to us shall be joint and several.

18.3 We shall be entitled:

(i)to release or conclude a compromise  with any Partner  without  affecting our
rights against the others or the partnership; and

(ii)to treat a notice or demand by us to any Partner as a notice or demand given
to the other Partners or to the  Partnership  (but we need not treat a notice or
demand in such manner); and

(iii)to  treat a notice or demand by any  Partner,  to us, as a notice or demand
given by the firm or all the Partners  (but we need not treat a notice or demand
in such manner); and

(iv)to  treat this  agreement  as binding upon any  executor,  administrator  or
personal representative of any of you and upon any committee,  receiver, trustee
or other persons acting on behalf of any of you.

18.4If at any time a member of your  partnership  ceases  for any reason to be a
member, you will forthwith notify us in writing of such fact.

18.5Provided  that the  notification  in  condition  18.4has been given then the
retiring  partner  shall have no obligation to us in respect of Debts Vesting in
us after  whichever  is the later of either the date of such  retirement  or the
service of notice of such  retirement  upon us.  However he shall  remain  fully
liable to us for all  matters  occurring  prior to the later of the date of such
retirement or the service of notice of such retirement upon us.

18.6You  warrant  that the persons  signing  this  agreement  comprise  all your
partners.  When you take a new partner you will notify us of such fact. You will
procure that your new partner  executes such  documents as may be required by us
to ensure that he is bound by the terms of this  agreement  and is placed  under
the same  obligations  to us as you are. If you change your  trading  style,  or
adopt another style,  or incorporate  your business,  you will notify us of such
fact, and if required by us, enter into such further agreement with us as may be
necessary.

18.7Notwithstanding  any change in your  partnership,  we may  account to you or
exercise all rights of set-off as if there had been no such change.

<PAGE>

18.8You will take all steps necessary to enable us to register this agreement at
the Bills of Sale Registry.

18.9If you are a sole trader,  you will seek our consent before  entering into a
partnership with another person or incorporate your business.


                                     GENERAL

19.1  Should we  propose to you a  variation  of any of the  provisions  of this
agreement then (provided that you have actually received that proposal),  in the
absence of any written  acceptance  or  rejection of it by you within 14 days of
its receipt,  the  submission to us thereafter of a  Notification  Schedule will
constitute  your  acceptance  of our proposal  provided  that you have  actually
received such proposal.

19.2 We may,  without your consent,  assign all of our rights and remedies under
the Debt  Purchase  Agreement or  sub-contract  or delegate our  obligations  or
duties but will  notify  you of our  having  done so. You will not assign any of
your rights nor delegate any of your duties under the Debt Purchase Agreement.

19.3Nodelay  or omission by us in exercising any of our rights or remedies shall
impair or  operate  as a waiver of them.  No waiver by us of any  breach of your
obligations  to us shall  constitute  a waiver of any other  breach.  No single,
partial or  defective  exercise  by us of any right shall  preclude  our further
exercise of our  rights.  Our rights are  cumulative  and not  exclusive  of any
rights provided at law or in equity.

19.4 The terms of the Debt Purchase Agreement and these Conditions are agreed by
us and by you to be  reasonable  but in the event  that any  provision  shall be
found to b e valid  only if some part of it were  deleted  then  such  provision
shall apply as if it were so deleted.

19.5 This Debt Purchase Agreement shall not constitute a partnership  between us
and you.

                            NOTICES AND JURISDICTION

20.1Any notice given by you (including  notice to terminate this agreement) must
be in writing and may only be given by recorded  delivery or registered  post to
our  registered  office or to such office as we may  designate to you in writing
for the purpose of receiving notices. It shall only be effective upon delivery.

20.2 Any notice  given by us to you to  terminate  the Debt  Purchase  Agreement
shall be in writing and sent by post or delivered to your  registered  office or
any place of your  business or it may be handed  personally  to any  Director of
yours, if you are a limited company or to any Partner, if you are a Partnership.
Save as  otherwise  specified,  any  other  notices  sent by us may be  given by
telephone, facsimile, transmission or electronic mail.

20.3Notices given by telephone, facsimile, transmission or electronic mail shall
take effect upon receipt.  Except as stated to the contrary,  notices  served by
post  shall  take  effect  forty-eight  hours  from the time of  posting or upon
receipt, whichever shall be the earlier.

20.4  The  Debt  Purchase  Agreement  shall  be  governed  by and  construed  in
accordance with English Law. You agree to accept the jurisdiction of the English
Courts but without  prejudice to our right to bring proceedings in the Courts of
any other jurisdiction.

                                   DEFINITIONS

21.1 In this agreement the following  expressions shall have the meaning set out
opposite each:

"Approved  Debt" Any Notified Debt classified by us as approved and which at the
relevant time is not a Disapproved Debt.

"Assignment"  A transfer of  ownership  or title by  whatever  means and whether
formal or informal.

"Collection  Date" In the case of a Debt which is:  (a)paid in cash: the date of
receipt by us of such cash;

(b)paid by cheque or other instrument:  the date on which funds representing the
same are cleared by our bankers for interest;

(c)paid by transfer of funds  effected by CHAPS or BACS: the date on which funds
are credited to our bank account;

"Contract  of  Sale" A  contract  for the  sale of goods  and/or  work  done and
materials  supplied and/or services  rendered and/or hiring by you to a Customer
under which a Debt arises;

"Customer"  The party under a Contract of Sale  obliged to pay you the Debt and,
where the context so permits, a prospective Customer;

"Debt" Any debt or other obligation (including any tax or duty), present, future
or  contingent,  of any  Customer  under a Contract  of Sale  together  with its
Related Rights; a Debt, where the context permits,  shall include part of a Debt
and all or part of its Related Rights;

"Delivered" In relation to Goods - despatched in the United Kingdom to the order
of the Customer; In relation to services - completed.

"Deliver" and "Delivery" are to be construed accordingly.

"Disapproved  Debt" A Debt  classified by us as disapproved  in accordance  with
condition 7.

"Domestic  Debt" A Debt  payable in  sterling  arising  from a Contract  of Sale
performed  in U.K.,  the  invoice  for which is  addressed  to a location in the
United Kingdom.

"Encumbrance"  Any mortgage,  charge,  pledge,  trust,  hypothecation,  lien, or
security interest of any kind or any retained title of any conditional vendor to
you.

"Encumbrancer" Any person holding, or with a right to, an Encumbrance.

<PAGE>

"Fees  and  Charges"  The  items  referred  to in  conditions10.4,  11.1 to 11.6
inclusive, 12.1 to 12.4 inclusive, 16.3, 16.5 and any other sums due from you to
us.

"Financial  Particulars"  The  subclauses  set out under the heading  "Financial
Particulars" in the Debt Purchase Agreement.

"Foreign Debt" A Debt whose invoice is:

(i)addressed  to a location in one of the Markets or Territories  referred to in
Part II of the Financial Particulars; and (ii)expressed in the Permitted Foreign
Currency  appearing  in the column  below such Market or Territory or such other
currency as we may approve.

"Funding Limit" The maximum debit balance at any time permitted on each Funds in
Use Account  which,  until further  notice from us, shall be the amount shown in
the Financial Particulars.

"Funds In Use Account "The account described in condition 9.

"General  Particulars"  The sub  clauses  set out  under  the  heading  "General
Particulars" in the Debt Purchase Agreement.

"Goods" Goods or services the subject of a Contract of Sale;

"Insolvent" In relation to any company and/or "Insolvency" means:

(i)the issue of a petition to wind up the company; or
(ii)the calling of a meeting to pass, or the passing of, a resolution to wind up
the company; or
(iii)the appointment of a receiver or administrative receiver or judicial factor
in respect of all or any part of the company's  undertaking  assets or property;
or
(iv)the issue of a petition for an administration order under the Insolvency Act
1986;or
(v)the making of a proposal for a voluntary arrangement under the Insolvency Act
1986;

In relation to an individual or partnership, means:
(i)the issue of a petition for order in bankruptcy or sequestration against that
individual or one or more individuals in the partnership; or
(ii)that  individual  or one or  more  individuals  in a  partnership  making  a
proposal for a voluntary arrangement under the Insolvency Act 1986; or

In relation to a partnership, means:
(i)the  issue  of a  petition  to  wind  up in  accordance  with  the  Insolvent
Partnerships Order 1994; or
(ii)the  partnership  making a proposal  for a voluntary  arrangement  under the
Insolvency Act 1986;or
(iii)on  the  issue  of a  petition  for an  administration  order  against  the
partnership;

In relation to any company, individual or partnership means:
(i)allowing an Encumbrancer to take possession of any assets; or
(ii)suffering distress execution or sequestration upon any assets; or
(iii)ceasing or threatening to cease to carry on business; or
(iv)giving notice of the intended suspension of payment of debts; or

(v)allowing  any judgment or order of any court or tribunal for payment of money
to remain  unsatisfied  for 7 days or more;  or (vi)being  insolvent  within the
terms of section 123(1)(a) and (b) of the Insolvency Act 1986.

"Net  Value" In  relation  to a Debt:  the  amount  actually  received  by us in
settlement or discharge after taking into account all deductions,  discounts and
off-sets.

"Non-Notifiable  Debts" Those debts listed in condition  4.1 prior to service of
any notice under condition 4.2.

"Non Sterling Domestic Debts" A Debt, arising from the performance in the United
Kingdom of a Contract of Sale,  the invoice for which is addressed to a location
in the United Kingdom but payable in a Permitted Foreign Currency referred to in
Part II of the Financial Particulars, in the column under U.K.

"Notification Schedule" A schedule in such form as we shall specify notifying us
of the  existence  and amount of Debts and the invoices  relating to them or any
credit notes and "Notified" and "Notify" are to be construed accordingly.

"Notified  Value" The full  amount of each Debt  referred  to in a  Notification
Schedule including any applicable tax or duty and before any discount for prompt
payment or otherwise;

"Permitted  Foreign Currency" A currency referred to in Part II of the Financial
Particulars except Sterling or such currency of which we may approve.

"Purchase  Price"  The  amount  payable by us to you for each Debt to which this
agreement applies together with its Related Rights.

"Related Rights"

(i)all your rights under a Contract of Sale;

(ii)all  instruments  (negotiable  or non  negotiable)  securities,  insurances,
bonds, guarantees and indemnities relating to a Debt;

(iii)all  your  ledgers,  documents,  computer  or  electronic  data  (including
operating systems) recording or evidencing Debts;

(iv)all Goods returned to or repossessed by you or rejected by a Customer;

"Settlement  Date" Three  months after the end of the month in which the invoice
recording the existence of a Debt is raised.

"Sterling" Sterling (GBP) or the freely

<PAGE>

transmissible currency of the United Kingdom for the time being.

"Termination Event" Any of the events set out in condition 15.1. "Trust Account"
A bank account opened in your name where we shall have the irrevocable  right to
appoint any of our  officers  as the only  authorised  signatories  and which is
unencumbered and declared in trust for us.

"UnitedKingdom"/"U.K"  The United Kingdom of Great Britain and Northern Ireland,
the Isle of Man and the Channel Islands.

"Vested"/"Vesting" In relation to a Debt: our ownership of that Debt by transfer
or the holding of that Debt in trust for us.

"We" or "Us"  LLOYDS TSB  Commercial  Finance  Limited  and our  successors  and
assignees.

"Working  Day" A day when both we and  Lloyds TSB Bank Plc shall be open for all
normal business in England and Wales.

"You" The party referred to as the Client in the Client Particulars.

21.2In the Debt Purchase Agreement (including these Conditions):

(a)unless the context otherwise  provides,  the singular includes the plural and
vice versa;

(b)any gender may include reference to any other gender;

(c)the headings and  punctuation in this agreement are for convenience  only and
shall be ignored in its interpretation;

(d)reference  to a  "clause"  is to a  clause  in  the  separate  Debt  Purchase
Agreement  executed  by you and us, of which these  Conditions  form an integral
part;

(e)  references to the "Debt  Purchase  Agreement" is to the separate  agreement
referred to in condition  21.2(d) and to any other  documents  constituting  the
entire agreement  between us as amended,  varied,  supplemented,  substituted or
novated from time to time;

(f)references to any person, including us, are to be construed as including that
person's permitted assigns, transferees or successors in title;

(g)the  meaning of general  words  introduced  by the word  "other" is not to be
limited by  reference to any  preceding  word  indicating a particular  class of
acts, matters or things;

(h)unless the context otherwise  requires,  where in or in relation to any place
outside  England  and Wales,  the meaning of a word or  expression  used in this
agreement is to be considered  and such word or expression has no counterpart in
that place, it is to have the meaning of its closest equivalent in that place;


(i)any  reference to an Act of  Parliament  shall be construed as a reference to
that Act as subsequently amended or re-enacted and shall include all subordinate
legislation deriving authority from that Act

<PAGE>


These  Conditions  are signed on our behalf and by or on your behalf to indicate
the  consent  of  each of us to  their  incorporation  into  the  Debt  Purchase
Agreement between us and you whose Commencement Date is 1 March 2001.


FOR LLOYDS TSB COMMERCIAL  FINANCE  LIMITED



                                                )
                                                )
                                                )
         /s/Peter Anderson                      )       Attorney
                                                )





 FOR ELCOM  HOLDINGS  LIMITED

                                                )
                                                )
                                                )
        /s/ Robert J.  Crowell                  )       Signature  of
                                                )       authorised
        /s/ Peter Rendall                       )       Director


{17032.00019:AHP1027.DOCv}

</TEXT>
</DOCUMENT>
