i) REVOLVING LOAN AGREEMENT

Exhibit 10.17

REVOLVING LOAN AGREEMENT

between

XXXXXX TECHNOLOGIES COMPANY

and

KELTIC FINANCIAL PARTNERS, LP

Dated: May 30, 2003

i) REVOLVING LOAN AGREEMENT

This Revolving Loan Agreement is made this 30th day of May, 2003,
between XXXXXX TECHNOLOGIES COMPANY ("Borrower"), a corporation organized and
existing pursuant to the laws of the State of Tennessee having an address at 000
Xxxxx Xxxxxxxxxx Xxxx, Xxxxx Xxxxx, Xxx Xxxx 00000.

and KELTIC FINANCIAL PARTNERS, LP ("Lender"), a Delaware limited
partnership, with a place of business at 000 Xxxxxxxx Xxxxx Xxxxxx, Xxxxx X-000,
Xxx, Xxx Xxxx 00000 (this "Agreement").

W I T N E S S E T H:

WHEREAS, Borrower has requested that Lender extend a FOUR MILLION
SIX HUNDRED THOUSAND and 00/100 Dollars ($4,600,000.00) revolving credit
facility, the proceeds of which will be used to repay existing indebtedness to
CIT Small Business Lending Corporation and to also provide Borrower with working
capital support.

WHEREAS, Borrower has requested that Lender extend a FOUR HUNDRED
THOUSAND and 00/100 Dollars ($400,000.00) term loan, the proceeds of which will
be used to repay existing indebtedness to CIT Small Business Lending Corporation
and to provide Borrower with working capital support.

WHEREAS, Lender is willing to extend the credit facilities on the
terms and subject to the conditions set forth in this Agreement.

ii) AGREEMENT

B. DEFINITIONS. As used herein, the following terms shall have the
following meanings (terms defined in the singular to have the same meaning
when used in the plural and vice versa):

i. "Account Debtor" shall mean any Person who is or may become
obligated under or on account of any Receivable.

ii. "Advance" shall mean any loan or advance made by Lender in
connection with the Revolving Loan.

iii. "Affiliate" shall mean any Person: (i) which directly or
indirectly through one or more intermediaries controls, or is controlled
by, or is under common control with, Borrower including, without
limitation, Xxxxxx Holdings, Inc. and Xxxxxx Technologies, Inc.; (ii)
which beneficially owns or holds 5% or more of any class of the voting
stock or other equity interest in Borrower; or (iii) 5% or more of the
voting stock or other equity interest of which is beneficially owned or
held by Borrower. For purposes hereof, "control" means the possession,
directly or indirectly, of the power to direct or cause the direction of
the management and policies of a Person, whether through the ownership of
voting stock or other equity interests, by contract or otherwise.

iv. "Authenticate" shall mean to sign or to execute or
otherwise adopt a symbol, or encrypt or similarly process a record in
whole or in part, with the present interest of the authenticating person
to identify the person and adopt or accept a Record.

v. "Bank Accounts" shall have the meaning set forth in Section
5.23 of this Agreement.

vi. "Banking Day" shall mean any day on which commercial banks
are not authorized or required to close in New York State.

vii. "Borrower" shall mean Xxxxxx Technologies Company.

viii. "Borrowing Capacity" shall have the meaning set forth in
Section 2.1 of this Agreement.

ix. "Borrowing Base Certificate" shall mean a borrowing base
certificate substantially in the form of Exhibit D attached hereto.

x. "Capital Expenditure" shall mean, as determined in
accordance with GAAP, the dollar amount of gross expenditures (including
obligations under capital leases) made or incurred for fixed assets, real
property, plant and equipment, and all renewals, improvements and
replacements thereto (but not repairs thereof) during any period.

xi. "Code" shall mean the Internal Revenue Code of the United
States.

xii. "Collateral" shall mean all of the Property and interests
in Property described in the General Security Agreement, and all other
personal property of Borrower and interests of Borrower in personal
property that now or hereafter secures the payment and performance of any
of the Obligations pursuant to any of the Loan Documents or otherwise
including, without limitation, any proceeds and insurance proceeds of the
foregoing.

xiii. "Contract Year" shall mean, during the term of the
Loans, each consecutive twelve (12) month period commencing on the date
hereof and, in each case, ending on the date, which is one day prior to
the applicable anniversary date hereof.

xiv. "Default" shall mean an event or condition the occurrence
of which would, with the lapse of time or the giving of notice, or both,
become an Event of Default, whether or not Lender has declared an Event of
Default to have occurred.

xv. "EBITDA" shall mean Borrower's total income before
interest expense, taxes, depreciation and amortization, all calculated in
accordance with GAAP.

xvi. "Eligible Inventory" shall mean Inventory which has been
identified and described to Lender's satisfaction, is represented by
Borrower (by its

acceptance of Revolving Loans thereon) as meeting all of the
following criteria on the date of any Revolving Loan based thereon
and thereafter while any Obligation is outstanding, and is in all
other respects acceptable to Lender:

a. Borrower is the sole owner of the Inventory; none of
the Inventory is being held or shipped by Borrower on a
consignment or approval basis; Borrower has not sold, assigned
or otherwise transferred all or any portion thereof; and none
of the Inventory is subject to any claim, lien or security
interest;

b. If any of the Inventory is represented or covered by
any document of title, instrument or chattel paper, Borrower
is the sole owner of all such documents, instruments and
chattel paper, all thereof are in the possession of Borrower,
none thereof has been sold, assigned or otherwise transferred,
and none thereof is subject to any claim, lien or security
interest;

c. The Inventory consists of refrigerants which have
been processed in accordance with all Governmental Rules, or
finished goods consisting of saleable cylinders to hold
refrigerants acquired by Borrower in the ordinary course of
its business, as conducted on the date hereof, subject to its
contract or sole possession and, located in compliance with
Section 5.15 of this Agreement or at locations approved by
Lender in writing for which landlord or bailee waivers in form
and substance acceptable to Lender have been executed and
delivered by such landlord or bailee to Lender.

xvii. "Eligible Receivables" shall mean and include only
Receivables of Borrower, the records and accounts of which are located in
compliance with Section 5.14 of this Agreement, are acceptable to Lender
in Lender's sole and absolute discretion, arise out of sales in the
ordinary course of Borrower's business as currently conducted, made by
Borrower to a Person which is not an Affiliate of Borrower nor an employee
of Borrower nor controlled by an Affiliate of Borrower, which are not in
dispute and which do not then violate any warranty with respect to
Eligible Receivables set forth in the General Security Agreement, and the
Inventory which is the subject matter of such Receivable, must have been
shipped to the customer on or prior to the invoice date, or the services
described in any such invoice must have been provided on or prior to the
invoice date. No Receivable shall be an Eligible Receivable if more than
ninety (90) days have passed since the original invoice date. Lender may
treat any Receivable as ineligible if:

a. any warranty contained in this Agreement or in the
General Security Agreement with respect to Eligible
Receivables or any warranty with respect to such Receivable
contained in this Agreement or in the General Security
Agreement has been breached; or

b. the Account Debtor or any Affiliate of the Account
Debtor has disputed liability, or made any claim with respect
to such Receivable

or with respect to any other Receivable due from such customer
or Account Debtor to Borrower, with respect to any Receivable
which Lender, in its sole and absolute discretion, deems
material; or

c. the Account Debtor or any Affiliate of the Account
Debtor has filed a case for bankruptcy or reorganization under
the Bankruptcy Code, or if any case under the Bankruptcy Code
has been filed against the Account Debtor or any Affiliate of
the Account Debtor, or if the Account Debtor or any Affiliate
of the Account Debtor has made an assignment for the benefit
of creditors, or if the Account Debtor or any Affiliate of the
Account Debtor has failed, suspended business operations,
become insolvent, or had or suffered a receiver or a trustee
to be appointed for all or a significant portion of its assets
or affairs; or

d. if the Account Debtor is also a supplier to or
creditor of Borrower or if the Account Debtor has or asserts
any right of offset with respect to any Receivable or asserts
any claim or counterclaim against Borrower with respect to any
Receivable or otherwise (so long as the Account Debtor does
not assert any right of set off or counterclaim, Lender,
subject to all the other provisions of this Agreement, will
only consider the Receivable ineligible in an amount equal to
the amount owed such Account Debtor by Borrower); or

e. the sale is to an Account Debtor outside the United
States, unless the sale is secured by a letter of credit or
acceptance acceptable to Lender in its sole discretion, or is
insured by a credit risk insurance policy acceptable to Lender
in its sole discretion or on other terms acceptable to Lender
in its sole discretion; or

f. fifty percent (50%) or more of the Receivables of any
Account Debtor and its Affiliates are ineligible, then all the
Receivables of such Account Debtor and its Affiliates may be
deemed ineligible by Lender under this Agreement; or

g. the total unpaid Receivables of the Account Debtor
exceed twenty percent (20%) of the net amount of all
Receivables, to the extent of such excess, except that with
respect to NRP/COOLGAS, INC., USA/ B & B and GENUINE PARTS
COMPANY, the percentage shall be twenty-five percent (25%),
provided the credit worthiness of any such Account Debtor is
acceptable to Lender in its sole discretion and credit
insurance coverage is in existence covering such Account
Debtor's Receivables acceptable to Lender in its sole and
absolute discretion; or

h. it relates to a sale of goods or services to the
United States of America, or any agency or department thereof,
unless Borrower assigns its right to payment of such
Receivable to Lender, in form and substance

satisfactory to Lender, so as to comply with the Assignment of
Claims Act of 1940, as amended; or

i. it relates to a sale of goods or services to a state
or local governmental authority or an agency or department
thereof in excess of $50,000.00 in the aggregate; or

j. it relates to intercompany sales, employee sales or
any Receivable due from an Affiliate of Borrower; or

k. it consists of a sale to an Account Debtor on
consignment, xxxx and hold, guaranteed sale, sale or return,
sale on approval, payment plan, scheduled installment plan,
extended payment terms or any other repurchase or return
basis; or

l. the Account Debtor is located in a state in which
Borrower is deemed to be doing business under the laws of such
state and which denies creditors access to its courts in the
absence of qualifications to transact business in such state
or of the filing of any reports with such state, unless
Borrower has qualified as a foreign corporation authorized to
do business in such state or has filed all required reports;
or

m. the Receivable is evidenced by chattel paper or an
instrument of any kind, or has been reduced to judgment; or

n. the Receivable arises from a sale of goods or
services to an individual who is purchasing such goods
primarily for personal, family or household purposes;

o. if Lender believes, in its sole and absolute
judgment, that collection of such Receivable is insecure or
that such Receivable may not be paid by reason of the Account
Debtor's financial inability to pay.

xviii. "Environment" shall mean any water or water vapor, any
land surface or subsurface, air, fish, wildlife, biota and all other
natural resources.

xix. "Environmental Laws" shall mean all federal, state and
local environmental, land use, zoning, health, chemical use, safety and
sanitation laws, statutes, ordinances and codes relating to the protection
of the Environment and/or governing the use, storage, treatment,
generation, transportation, processing, handling, production or disposal
of "hazardous substances" and the rules, regulations, policies,
guidelines, interpretations, decisions, orders and directives of federal,
state and local governmental agencies and authorities with respect
thereto.

xx. "ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended.

xxi. "Events of Default" shall have the meaning set forth in
Article 12 of this Agreement.

xxii. "Fiscal Year" shall mean with respect to any Person, a
year of 365 or 366 days, as the case may be, ending on the last day of
December in any calendar year.

xxiii. "Fixed Charge Coverage Ratio" shall mean, for any
period, the ratio of EBITDA over the sum of (i) interest and fees due in
respect of Indebtedness for such period, excluding the commitment and
closing fees payable pursuant to Section 3.3 of this Agreement, (ii)
principal payments due on any Loan during such period, (iii) principal
payments on any other Indebtedness during such period, (iv) capital
expenditures for such period, (v) taxes due for such period, (vi) cash
dividends declared during such period, and (vii) distributions paid on
subordinated debt or equity during such period.

xxiv. "GAAP" shall mean generally accepted accounting
principles consistently applied and maintained throughout the period
indicated and consistent with the prior financial practice of Borrower,
except for changes mandated by the Financial Accounting Standards Board or
any similar accounting authority of comparable standing. Whenever any
accounting term is used herein which is not otherwise defined, it shall be
interpreted in accordance with GAAP.

xxv. "General Security Agreement" shall mean the general
security agreement dated the date hereof executed and delivered by
Borrower to Lender.

xxvi. "Governmental Rules" shall have the meaning given to
such term in Section 5.24 of this Agreement.

xxvii. "Indebtedness" shall mean and include all obligations
for borrowed money of any kind or nature, including funded debt and
unfunded liabilities, contingent obligations under guaranties or letters
of credit, and all obligations for the acquisition or use of any fixed
asset, including capitalized leases, or improvements which are payable
over a period longer than one year, regardless of the term thereof or the
Person or Persons to whom the same is payable and the Obligations.

xxviii. "Inventory" shall have the meaning given to such term
in the General Security Agreement.

xxix. "LIBOR" shall mean the London Inter-Bank Offered Rate as
quoted by Citibank, N.A. in New York City at 11:00 a.m. (New York time)
based upon Citibank, N.A.'s or an affiliated agency's or branch's quotes
to prime banks in the London Inter-Bank Euro-currency Market for
Eurodollar deposits.

xxx. "Loan Documents" shall mean this Agreement, the General
Security Agreement and all other documents and instruments to be delivered
by Borrower or any other Person under this Agreement or in connection with
the Loans or any other Indebtedness or Obligations of Borrower to Lender,
as the same may be amended, modified or supplemented from time to time.

xxxi. "Loan Interest Rate" shall mean, at the option of
Lender, the greater of: (a) the prime rate published in the "Money Rates"
column of The Wall Street Journal from time to time or, in the event that
The Wall Street Journal is not available at any time, such rate published
in another publication as determined by Lender plus two hundred (200)
basis points per annum, or (b) six and one-half percent (6-1/2%) per
annum.

xxxii. "Loans" shall mean the loans and advances made by
Lender hereunder, including all Advances and the Term Loan.

xxxiii. "Lockbox" shall mean the account established by
Borrower pursuant to the lockbox agreement among Borrower, Lender and a
financial institution with which Borrower maintains a depository account
into which the proceeds of all Collateral are to be deposited.

xxxiv. "Material Adverse Effect" shall mean any material
adverse effect, as determined in Lender's sole and absolute discretion, on
(a) the business, assets, operations, prospects or condition, financial or
otherwise, of Borrower or any guarantor; (b) Borrower's or any guarantor's
ability to pay or perform the Obligations in accordance with their terms;
(c) the value, collectability or salability of the Collateral or the
perfection or priority of Lender's liens; (d) the validity or
enforceability of this Agreement or any of the Loan Documents; or (e) the
practical realization of the benefits, rights and remedies inuring to
Lender under this Agreement or under the other Loan Documents.

xxxv. "Maximum Facility" shall mean Five Million and 00/100
Dollars ($5,000,000.00).

xxxvi. "Notice of Borrowing" shall mean a borrowing request in
a Record substantially in the form of Exhibit C attached hereto.

xxxvii. "Obligations" shall mean and include all loans
(including the Loans), advances, debts, liabilities, obligations,
covenants and duties owing by Borrower to Lender or any Affiliate of
Lender of any kind or nature, present or future, whether or not evidenced
by any note, guaranty or other instrument, whether arising under this
Agreement, the other Loan Documents or under any other agreement or by
operation of law, whether or not for the payment of money, whether arising
by reason of an extension of credit, opening, guaranteeing or confirming
of a letter of credit, loan, guaranty, indemnification or in any other
manner, whether direct or indirect (including those acquired by purchase
or assignment), absolute or contingent, due or to become due, now due or
hereafter arising and howsoever acquired including, without limitation,
all interest, charges, expenses, commitment, facility, collateral
management or other fees, attorneys' fees and expenses, consulting fees
and expenses and any other sum chargeable to Borrower under this
Agreement, the other Loan Documents or any other agreement with Lender.

xxxviii. "Person" shall mean an individual, partnership,
limited liability company, limited liability partnership, corporation,
joint venture, joint stock company, land trust, business trust or
unincorporated organization, or a government or agency or political
subdivision thereof.

xxxix. "Plan" shall mean an employee benefit plan or other
plan now or hereafter maintained for employees of Borrower or any
subsidiary of Borrower and covered by Title IV of ERISA.

xl. "Property" shall have the meaning set forth in the General
Security Agreement.

xli. "Receivables" shall have the meaning set forth in the
General Security Agreement.

xlii. "Reconciliation Report" shall mean a report in form
satisfactory to Lender, reconciling Borrower's month-end Receivable
agings, payable agings and Inventory listings to Borrower's monthly
financial statements, and including bank reconciliations.

xliii. "Record" shall mean information that is inscribed on a
tangible medium or which is stored in an electronic or other medium and is
retrievable in perceivable form. If Lender so specifies with respect to a
particular type of Record, that type of Record shall be signed or
otherwise authenticated by Borrower.

xliv. "Reportable Event" shall have the meaning assigned to
that term in Title IV of ERISA.

xlv. "Revolving Loan" shall mean the Advances to be made by
Lender to Borrower pursuant to Section 2.1 of this Agreement, and all
interest thereon and all fees, costs and expenses payable by Borrower in
connection therewith.

xlvi. "Revolving Note" shall mean, the promissory note
substantially in the form annexed hereto as Exhibit A, to be given by
Borrower to Lender to evidence the Revolving Loan.

xlvii. "Solvent" shall mean when used with respect to any
Person, such Person (i) owns property the fair value of which is greater
than the amount required to pay all of such Person's Indebtedness
(including contingent debts), (ii) owns property the present fair salable
value of which is greater than the amount that will be required to pay the
probable liabilities of such Person on its then existing Indebtedness as
such become absolute and matured, (iii) is able to pay all of its
Indebtedness as such Indebtedness matures, and (iv) has capital sufficient
to carry on its then existing business.

xlviii. "Tangible Net Worth" shall mean the net worth of
Borrower less the value of intangible assets and other assets whose value,
in the sole opinion of Lender, are less than the stated value carried on
the balance sheet of Borrower.

xlix. "Termination Date" shall mean the earlier of the date
that is three (3) years from the date hereof, or the date on which Lender
terminates this Agreement pursuant to Section 12.1 of this Agreement.

l. "Termination Notice" shall have the meaning set forth in
Section 3.7 of this Agreement.

li. "Term Loan" shall mean the term loan made by Lender to
Borrower pursuant to Section 2.2 of this Agreement.

lii. "Term Note" shall mean the promissory note substantially
in the form annexed hereto as Exhibit B to be given by Borrower to Lender
to evidence the Term Loan.

liii. "UCC" means the Uniform Commercial Code as in effect
from time to time.

C. THE REVOLVING LOAN.

i. Advances. Subject to the terms and conditions of this
Agreement and relying upon the representations and warranties set forth in
this Agreement, for so long as no Default or Event of Default exists,
Lender shall lend in its discretion to Borrower on its request, a sum
("Borrowing Capacity") equal to the lesser of:

a. Four Million Six Hundred Thousand and 00/100 Dollars
($4,600,000.00), or

b. the sum of (i) up to eighty-five percent (85%) of the
net face amount of Borrower's Eligible Receivables and (ii) up
to fifty percent (50%) of the Value of Borrower's Eligible
Inventory. Value shall mean the lesser of cost or the fair
market value of such Inventory.

Within the limits of the Borrowing Capacity, and subject to the
limitations set forth in this Agreement, Borrower may borrow, repay and reborrow
Advances.

ii. Term Loan. Lender shall make a loan to Borrower on the
date hereof in the amount of Four Hundred Thousand and 00/100 Dollars
($400,000.00), the proceeds of which will be used to refinance the
indebtedness of Borrower to CIT Small Business Lending Corporation and the
balance for Borrower's working capital needs (the "Term Loan"). The Term
Loan shall be payable as follows: equal monthly principal installments
each in the amount of $6,666.67, commencing July 1, 2003 payable on the
first day of each month thereafter until May 30, 2006 on which date the
entire unpaid principal balance of the Term Loan together with all accrued
but unpaid interest shall be immediately due and payable. Notwithstanding
the foregoing, the Term Loan must be repaid in full if Borrower prepays
all or substantially all of the Revolving Advances.

iii. Overline. Borrower acknowledges that Lender has advised
Borrower that Lender does not intend to permit Borrower to incur
Obligations at any time in an outstanding principal amount exceeding
either the Borrowing Capacity or the Maximum Facility; however, it is
agreed that should the Obligations of Borrower to Lender incurred under
the Loans or otherwise exceed either, then such excess Obligations shall
(a) constitute Obligations under this Agreement, (b) be entitled to the
benefit of all security and protection under this Agreement and the other
Loan Documents, (c) be secured by the Collateral and (d) be payable
immediately without notice or demand by Lender.

iv. Reserves. The Borrowing Capacity shall be subject to such
reserves, as Lender shall deem necessary and proper in Lender's sole and
absolute discretion. Reserves may be established by Lender from time to
time in such manner (including reduction of the advance rates set forth in
Subsection 2.1(b) above) and for such reasons as Lender may determine from
time to time in Lender's sole and absolute discretion. Payments, deposits,
guaranties or indemnifications made by Lender under any reimbursement
agreement, guaranty or similar instrument made in respect of any such
instrument may be treated by Lender as Advances to Borrower under this
Agreement.

v. Manner of Borrowing.

(a) Each Advance shall be requested in an Authenticated Record
sent via facsimile or electronic transmission including, without limitation, via
e-mail by a Notice of Borrowing executed by an authorized officer of Borrower,
not later than 11:00 a.m. Eastern Time on any Banking Day on which an Advance is
requested. Provided that Borrower shall have satisfied all conditions precedent
set forth in this Agreement, including the reaffirmation of the representations
and warranties and covenants provided in Article 10 of this Agreement, and
Borrower shall have sufficient Borrowing Capacity to permit an Advance under
this Agreement in accordance with Section 2.1 of this Agreement, Lender shall
make the Advance to Borrower in the amount requested in the Record by Borrower
in immediately available funds for credit to any account of Borrower (other than
a payroll account) at a bank in the United States of America as Borrower may
specify (provided, however, that Borrower shall pay Lender its usual and
customary fees for such transfer). Lender shall not be responsible for any
failure of any amount so transferred to be credited to any such account, unless
such failure is due to Lender's gross negligence or willful misconduct.

(b) The Term Loan shall be advanced in a single advance on the
date of this Agreement.

vi. Evidence of Borrower's Obligations. Borrower's obligation
to pay the principal of, and interest on, the Advances made to Borrower
shall be evidenced by the Revolving Note executed by Borrower and
delivered to Lender. Borrower's obligation to pay the principal of, and
interest on, the Term Loan shall be evidenced by the Term Note.

vii. Payments. All payments with respect to the Obligations
shall either be charged by Lender to Borrower's account pursuant to
Section 2.8 hereof,

charged as an Advance or made by Borrower to Lender in U.S. currency and
without any defense, offset or counterclaim of any kind, at 000 Xxxxxxxx
Xxxxx Xxxxxx, Xxxxx X-000, Xxx, Xxx Xxxx 00000, or to such other address
as Lender shall specify, by 12:00 noon New York, New York time on the date
when due. Whenever any payment to be made shall otherwise be due on a day
that is not a Banking Day, such payment shall be made on the next
succeeding Banking Day and such extension of time shall be included in
computing interest in connection with any such payment. Lender may make an
Advance to reimburse itself for any payments on the Obligations (including
fees and expenses payable by Borrower), which are not paid when due,
without notice or demand to Borrower. Any delay or failure by Lender in
submitting any invoice for such interest or fee or in the making of an
Advance against the Revolving Loan shall not discharge or relieve Borrower
of its obligation to make such interest or fee payment.

viii. Collections/Balance/Statements/etc.

(a) Collection and Remittance.

(i) Borrower covenants and agrees to enter into a depository
account service agreement with Fleet Bank, F.A. to
establish a depository account for the benefit of
Borrower over which Lender shall have the sole power of
withdrawal.

(ii) All proceeds of Collateral whether cash, checks, drafts,
notes, acceptances or other forms of payment, if
received by Borrower, shall be received by Borrower in
trust for Lender, and Borrower agrees to deliver or
cause to be delivered, such payments forthwith, in the
identical form in which received, to Lender or into a
depository account established for the benefit of
Borrower, as Lender shall require from time to time.

(iii) Collected funds in the depository account for the
benefit of Borrower shall be swept daily and the
proceeds deposited to an account of Lender or as Lender
shall otherwise elect.

(b) Determination of balance of Revolving Loans. In determining
the outstanding balance of the Revolving Loans, (i)
available/collected funds received from the depository account
for the benefit of Borrower in the Lender's account at Fleet
Bank, F.A. CT (Keltic Financial Partners, L.P. f/b/o Fleet
Capital Corp.) account number 9428395446 ABA 000000000 (or
such other account as Lender may direct from time to time),
before 2 p.m. Eastern Time of a Banking Day will be credited
on that Banking Day, and thereafter on the following Banking
Day, as follows: (A) First, to unpaid interest, (B) second to
unpaid fees and expenses; (C) third to the outstanding
principal balance of the Revolving Loan, and (D) fourth to all
other Obligations in such order as Lender shall elect; (ii)
any other form of funds received by Lender will be credited on
the Banking Day when Lender has received notification that
such funds are collected/available to Lender if before 2 p.m.
(Eastern Time), and thereafter on the following Banking Day;
(iii) all credits shall be conditional upon final payment to
Lender in cash or solvent credits of the items giving rise to
them and, if any item is not so paid, the amount of any credit
given for it shall be charged to the balance of the Revolving
Loan whether or not the item is returned; and (iv) for the
purpose of computing interest on the

Revolving Loan and other Obligations, interest shall continue
to accrue on the amount of any payment credited to Borrower's
Revolving Loan balance by Lender for a period of three (3)
Banking Days after the date so credited.

ix. Payment on Termination Date. Notwithstanding anything
herein to the contrary, the entire outstanding principal balance of the Loans,
plus all accrued and unpaid interest thereon and all fees and other amounts
payable under this Agreement and the other Loan Documents, shall be due and
payable in full, on the Termination Date.

D. LENDER'S COMPENSATION.

i. Interest on Advances. Borrower shall pay interest monthly,
in arrears, on the first day of each month, commencing June 1, 2003, on
the average daily, unpaid principal amount of the Revolving Loans at a
fluctuating rate, which is equal to the Loan Interest Rate.
Notwithstanding the foregoing, on and after the occurrence of a Default or
Event of Default, Borrower shall pay interest on the Revolving Loan at a
rate which is three and one-half percent (3.50%) per annum above the Loan
Interest Rate; provided, however, in no event shall any interest to be
paid under this Agreement or under any Loan Document that would exceed the
maximum rate permitted by law.

ii. Interest on the Term Loan. Borrower shall pay interest
monthly, in arrears, on the first day of each month, commencing June 1,
2003 on the unpaid principal amount of the Term Loan at a fluctuating rate
which is equal to the Loan Interest Rate. Notwithstanding the foregoing,
after the occurrence of an Event of Default hereunder, Borrower shall pay
interest on the unpaid principal balance of the Term Loan at a rate which
is three and one-half percent (3.5%) per annum above the interest rate
which would otherwise be applicable to the Term Loan; provided, however,
in no event shall any interest to be paid hereunder or under any Loan
Document that would exceed the maximum rate permitted by law.

iii. Commitment and Closing Fee. Borrower has paid to Lender
Seventy-Five Thousand and 00/100 Dollars ($75,000.00) as a commitment and
closing fee which fee has been fully earned by Lender.

iv. Facility Fee. Borrower shall pay to Lender monthly, in
arrears, on the first day of each month a facility fee in an amount equal
to one percent (1.0%) per annum of the Maximum Facility, which facility
fee is deemed earned in full for each year on the date hereof and on each
anniversary hereof.

v. Collateral Management Fee. Borrower shall pay to Lender
monthly, in arrears, on the first day of each month, a collateral
management fee in the amount of Two Thousand and 00/100 Dollars
($2,000.00). Upon the occurrence of a Default or an Event of Default and
during the continuance of such Default or Event of Default, the fee shall,
in the sole discretion of Lender, be increased by $1,000.00 per month.

vi. Field Examination Fees. Borrower shall promptly reimburse
Lender for all reasonable costs and expenses associated with periodic
field examinations and fixed asset appraisals performed by Lender and its
agents, as deemed necessary by Lender.

vii. Liquidated Damages. If Borrower prepays the principal of
the Revolving Loan to Borrower (other than from time to time from working
capital) or if the outstanding Obligations become due prior to the
Termination Date for any reason or no reason, Borrower shall pay to Lender
at the time of such prepayment, liquidated damages in an amount equal to:
(a) five percent (5.0%) of the Maximum Facility if the prepayment is made
prior to June 1, 2004; (b) three percent (3.0%) of the Maximum Facility if
the prepayment is made on or after June 1, 2004, but prior to June 1,
2005; and (c) one percent (1.0%) of the Maximum Facility if the prepayment
is made after June 1, 2005. Borrower shall give Lender at least ninety
(90) days' advance written notice ("Termination Notice") of Borrower's
election to terminate the availability of Revolving Loans under this
Agreement prior to the Termination Date. The Termination Notice shall be
irrevocable and shall specify the effective date of such termination,
which effective date shall not be less than ninety (90) days after the
giving of the Termination Notice and shall in no event be later than the
Termination Date. After the Termination Date, Lender shall have no
obligation to make any Advance(s) to Borrower.

viii. Computation of Interest and Fees. All interest and fees
under this Agreement shall be computed on the basis of a year consisting
of three hundred sixty (360) days for the number of days actually elapsed.

E. APPLICATION OF PROCEEDS. The proceeds of the Term Loan and the
Advances shall be used solely by Borrower to affect the acquisition of
certain assets, to repay existing indebtedness incurred in connection
therewith, for working capital needed in the normal operation of
Borrower's business and as provided in Section 9.6 of this Agreement.

F. INDUCING REPRESENTATIONS. In order to induce Lender to make the
Loans, Borrower makes the following representations and warranties to
Lender:

i. Organization and Qualifications. Borrower is and always has
been a corporation duly organized and validly existing under the laws of
the State of Tennessee. Borrower's tax identification number is
00-0000000. Borrower is qualified to do business in every jurisdiction
where the nature of its business requires it to be so qualified.

ii. Name and Address. During the preceding five (5) years,
Borrower has not been known by nor has used any other name whether
corporate, fictitious or otherwise, except as set forth on Schedule 5.2
attached hereto. Borrower's chief executive office is 000 Xxxxx Xxxxxxxxxx
Xxxx, Xxxxx Xxxxx, Xxx Xxxx 00000.

iii. Structure. Borrower has no subsidiaries or Affiliates,
except as set forth on Schedule 5.3 attached hereto.

iv. Legally Enforceable Agreement. The execution, delivery and
performance of this Agreement, each and all of the other Loan Documents
and each and all other instruments and documents to be delivered by
Borrower or its Affiliates under this Agreement and the creation of all
liens and security interests provided for herein are

within Borrower's corporate power, have been duly authorized by all
necessary or proper corporate action (including the consent of
shareholders where required), are not in contravention of any agreement or
indenture to which Borrower is a party or by which it is bound, or of the
Certificate of Incorporation or By-Laws of Borrower, and are not in
contravention of any provision of law and the same do not require the
consent or approval of any governmental body, agency, authority or any
other Person which has not been obtained and a copy thereof furnished to
Lender.

v. Solvent Financial Condition. Borrower is Solvent.

vi. Financial Statements. The audited financial statements of
Borrower as of December 31, 2002, copies of which have been delivered to
Lender, fairly present Borrower's financial condition and results of
operations in accordance with GAAP, and as of such dates and there have
been no changes since such dates. Borrower has no contingent liabilities,
liabilities for taxes, unusual forward or long-term commitments, or
unrealized or unanticipated losses from any unfavorable commitments, which
were not disclosed in such financial statements or the notes thereto.

vii. Joint Ventures. Borrower is not engaged in any joint
venture or partnership with any other Person.

viii. Real Estate. Attached hereto as Schedule 5.8 is a list
showing all real property owned or leased by Borrower, and if leased, the
correct name and address of the landlord and the date and term of the
applicable lease.

ix. Intellectual Property. Borrower owns or possesses all the
patents, trademarks, service marks, trade names, copyrights, licenses and
other intellectual property necessary for the present and planned future
conduct of its business without any conflict with the rights of others.
All such patents, trademarks, service marks, trade names, copyrights,
licenses and other similar rights are listed on Schedule 5.9 attached
hereto, if any.

x. Existing Business Relationship. There exists no actual or
threatened termination, cancellation or limitation of, or any adverse
modification or change in, the business relationship of Borrower with any
supplier, customer or group of customers whose purchases individually or
in the aggregate could effect the operations or the financial condition of
Borrower.

xi. Investment Company Act: Federal Reserve Board Regulations.
Borrower is not an "investment company", or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company"; as
such terms are defined in the Investment Company Act of 1940, as amended
(15 U.S.C. ss. 80(a)(1), et seq.). The making of the Loans under this
Agreement by Lender, the application of the proceeds and repayment thereof
by Borrower and the performance of the transactions contemplated by this
Agreement will not violate any provision of such Act, or any rule,
regulation or order issued by the Securities and Exchange Commission
thereunder. Borrower does not own any margin security as that term is
defined in Regulation U of the Board of Governors of

the Federal Reserve System and the proceeds of the Loans made pursuant to
this Agreement will be used only for the purposes contemplated under this
Agreement. None of the proceeds will be used, directly or indirectly, for
the purpose of purchasing or carrying any margin security or for the
purpose of reducing or retiring any Indebtedness which was originally
incurred to purchase or carry margin security or for any other purpose
which might constitute any of the Loans under this Agreement a "purpose
credit" within the meaning of said Regulation U or Regulations T or X of
the Federal Reserve Board. Borrower will not take, or permit any agent
acting on its behalf to take, any action which might cause this Agreement
or any document or instrument delivered pursuant hereto to violate any
regulation of the Federal Reserve Board.

xii. Tax Returns. Borrower and the guarantor have filed all
tax returns (Federal, state or local) required to be filed and paid all
taxes shown thereon to be due including interest and penalties or has
provided adequate reserves therefor. No assessments have been made against
Borrower or any guarantor by any taxing authority nor has any penalty or
deficiency been made by any such authority. To the best of Borrower's
knowledge, no Federal income tax return of Borrower or any guarantor is
presently being examined by the Internal Revenue Service nor are the
results of any prior examination by the Internal Revenue Service or any
state or local tax authority being contested by Borrower or any guarantor.

xiii. Litigation. Except as disclosed in Schedule 5.13, no
action or proceeding is now pending or, to the knowledge of Borrower,
threatened against Borrower or any guarantor, at law, in equity or
otherwise, before any court, board, commission, agency or instrumentality
of the Federal or state government or of any municipal government or any
agency or subdivision thereof, or before any arbitrator or panel of
arbitrators, and neither Borrower nor any guarantor has accepted liability
for any such action or proceeding. There is no proceeding pending before
any governmental agency (Federal, state or local) and, to the best of
Borrower's knowledge, no investigation has been commenced before any such
governmental agency the effect of which, if adversely decided, would or
could, have a Material Adverse Effect.

xiv. Receivables Locations. Annexed hereto as Schedule 5.14 is
a list showing all places at which Borrower maintains, or will maintain,
records relating to Receivables. Borrower will provide Lender thirty (30)
days prior written notice by means of an Authenticated Record of any new
location where Borrower maintains records relating to Receivables or
closes any location where it maintained records related to Receivables.

xv. Inventory Locations. Annexed hereto as Schedule 5.15 is a
list showing all places where Borrower maintains, or will maintain,
Inventory. Such list indicates whether the premises are owned or leased by
Borrower or whether the premises are the premises of a warehouseman or
other third party, and if owned by a third party, the name and address of
such third party. Borrower shall provide Lender thirty (30) days prior
written notice by means of an Authenticated Record of any new location of
where Borrower maintains Inventory or closes any location where it
maintains Inventory. This notice shall indicate whether the premises are
owned or leased by Borrower or whether

such premises are the premises of a warehouseman or other third party, and
if owned by a third party, the name and address of such third party. Prior
to moving any Inventory to a new location, Borrower shall obtain a
landlord's waiver in form and content acceptable to Lender in its
discretion.

xvi. Equipment List and Locations. Annexed hereto as Schedule
5.16 is a list showing all of Borrower's equipment, and describing the
places where the same is located. Such list indicates whether such
premises are owned or leased by Borrower or whether the premises are the
premises of another third party, and if leased, the name and address of
such third party. Borrower shall provide Lender thirty (30) days prior
written notice by means of an Authenticated Record of any new location of
where Borrower maintains Equipment or closes any location where it
maintains Equipment. This notice shall indicate whether the premises are
owned or leased by Borrower or whether

such premises are the premises of a warehouseman or other third party, and
if owned by a third party, the name and address of such third party. Prior
to moving any Equipment to a new location, Borrower shall obtain a
landlord's waiver in form and content acceptable to Lender in its
discretion.

xvii. Title/ Liens. Borrower has good and marketable title to
the Collateral as sole owner thereof. There are no existing liens on any
Property of Borrower, except for liens in favor of Lender and liens
described in Schedule 5.17. Except as set forth on Schedule 5.17, none of
the Collateral is subject to any prohibition against encumbering,
pledging, hypothecating or assigning the same or requires notice or
consent in connection therewith.

xviii. Existing Indebtedness. Borrower has no existing
Indebtedness except the Indebtedness described in Schedule 5.18.

xix. ERISA Matters. The present value of all accrued vested
benefits under any Plan (calculated on the basis of the actuarial
evaluation for the Plan) did not exceed as of the date of the most recent
actuarial evaluation for such Plan the fair market value of the assets of
such Plan allocable to such benefits. Borrower is not aware of any
information since the date of such evaluation that would affect the
information contained therein. Such Plan has not incurred an accumulating
funding deficiency, as that term is defined in Section 302 of ERISA or
Section 412 of the Code (whether or not waived), no liability to the
Pension Benefit Guaranty Corporation (other than required premiums which
have become due and payable, all of which have been paid) has been
incurred with respect to the Plan and there has not been any Reportable
Event which presents a risk of termination of the Plan by the Pension
Benefit Guaranty Corporation. Borrower has not engaged in any transaction
which would subject Borrower to tax, penalty or liability for prohibited
transactions imposed by ERISA or the Code.

xx. O.S.H.A. Borrower has duly complied with, and its
facilities, business, leaseholds, equipment and other property are in
compliance in all respects with, the provisions of the Federal
Occupational Safety and Health Act and all rules and regulations
thereunder and all similar state and local Governmental Rules. There are
no outstanding citations, notices or orders of non-compliance issued to
Borrower or relating

to its facilities, business, leaseholds, equipment or other property under
any such Governmental Rules.

xxi. Environmental Matters. Except as disclosed in Schedule
5.21,

a. No Property owned or used by Borrower is or has been
used for the generation, manufacture, refining,
transportation, treatment, storage, handling or disposal of
any "hazardous substances" or "hazardous wastes". The
following are all of the Standard Industrial Classification
Codes applicable to the properties and operations of Borrower:
1711; (b) Borrower is in compliance with all applicable
Environmental Laws; (c) there has been no contamination or
release of hazardous substances at, upon, under or within any
Property owned or leased by Borrower, and there has been no
contamination (as defined in any applicable Environmental Law)
or release of hazardous substances (as defined in any
applicable Environmental Law) on any other Property that has
migrated or threatens to migrate to any Property owned or
leased by Borrower; (d) to the best of Borrower's knowledge,
there are not now and never have been above-ground or
underground storage tanks at any Property owned or leased by
Borrower; (e) there are no transformers, capacitors or other
items of Equipment containing polychlorinated biphenyls at
levels in excess of 49 parts per million, violative of any
applicable Environmental Law, at any Property owned or leased
by Borrower; (f) no hazardous substances are present at any
Property owned or leased by Borrower, nor will any hazardous
substances be present upon any such Property or in the
operation thereof by Borrower; (g) all permits and
authorizations required under Environmental Laws for all
operations of Borrower have been duly issued and are in full
force and effect including, but not limited to, those for air
emissions, water discharges and treatment, storage tanks and
the generation, treatment, storage and disposal of hazardous
substances; (h) there are no past, pending or threatened
environmental claims against Borrower or any Property owned or
leased by Borrower; and there is no condition or occurrence on
any Property owned or leased by Borrower that could be
anticipated (1) to form the basis of an environmental claim
against Borrower or its properties or (2) to cause any
Property owned or leased by Borrower to be subject to any
restrictions on its ownership, occupancy or transferability
under any Environmental Law; (i) no portion of any Property
owned or leased by Borrower contains asbestos-containing
material that is or threatens to become friable; (j) the
representations and warranties set forth in this Section 5.21
shall survive repayment of the Obligations and the termination
of this Agreement and the other Loan Documents.

xxii. Labor Disputes. There are no pending or, to Borrower's
knowledge, threatened labor disputes which could have a Material Adverse
Effect.

xxiii. Location of Bank and Securities Accounts. Annexed
hereto as Schedule 5.23 is a complete and accurate list of all deposit,
checking and other bank accounts, all securities and other accounts
maintained with any broker dealer and all other similar accounts
maintained by Borrower (collectively, "Bank Accounts"), together with a
description thereof.

xxiv. Compliance With Laws. Borrower is in compliance with all
Federal, state and local governmental rules, ordinances and regulations
("Governmental Rules") applicable to its ownership or use of properties or
the conduct of its business.

xxv. No Other Violations. Borrower is not in violation of any
term of its Certificate of Incorporation or By-laws and no event or
condition has occurred or is continuing which constitutes or results in
(or would constitute or result in, with the giving of notice, lapse of
time or other condition) (a) a breach of, or a default under, any
agreement, undertaking or instrument to which Borrower is a party or by
which it or any of its Property may be affected, or (b) the imposition of
any lien on any Property of Borrower.

xxvi. Survival of Representations and Warranties. Borrower
covenants, warrants and represents to Lender that all representations and
warranties of Borrower contained in this Agreement or in any other Loan
Documents shall be true at the time of Borrower's execution of this
Agreement and the other Loan Documents, and Lender's right to bring an
action for breach of any such representation or warranty or to exercise
any remedy under this Agreement based upon the breach of any such
representation or warranty shall survive the execution, delivery and
acceptance hereof by Lender and the closing of the transactions described
herein or related hereto until the Obligations are finally and irrevocably
paid in full.

G. FINANCIAL STATEMENTS AND INFORMATION; CERTAIN NOTICES TO LENDER.
So long as Borrower shall have any Obligations to Lender under this
Agreement, Borrower shall deliver to Lender, or shall cause to be
delivered to Lender:

i. Borrowing Base Certificate. Weekly (on or before Tuesday of
each week as of the preceding week end), and monthly (within two (2) days
after the end of each month) and contemporaneously with each request for
an Advance, a satisfactorily completed and executed Borrowing Base
Certificate.

ii. Monthly Reports. Within fifteen (15) days after the end of
each month, an accounts receivable aging, accounts payable aging, an
inventory listing, a collateral update certificate, and a Reconciliation
Report of Borrower for such month, all in form satisfactory to Lender,
prepared by Borrower and if Lender so requests, customer statements, sales
journals, cash receipts journals and detailed sales credit reports.

iii. Annual Financial Statements. Within ninety (90) days
after the close of each Fiscal Year of Borrower, a copy of audited annual
financial statements of Borrower and its Affiliates prepared by an
independent certified public accountant on a combined basis consisting of
a balance sheet, statements of operations and retained

earnings and accompanying footnotes, statements of cash flow, together
with the unqualified opinion of such accounting firm, acceptable to Lender
in its sole discretion.

iv. Monthly Financial Statements. Within thirty (30) days
after the end of each month of Borrower, financial statements consisting
of a balance sheet, statements of operations and retained earnings and
statements of cash flow, prepared by management of Borrower, or Xxxxxx
Technologies Company in accordance with GAAP, together with a compliance
certificate in the form attached as Exhibit E hereto.

v. Projections. Within thirty (30) days prior to the end of
each Fiscal Year of Borrower, monthly financial projections for the next
fiscal year and annual projections for each succeeding Fiscal Year of
Borrower in form satisfactory to Lender.

vi. Customer Lists. Annually, a list of all of Borrower's
customers and vendors, including the addresses, and telephone and
facsimile numbers of such customers and vendors which lists shall be
delivered within thirty (30) days of each Fiscal Year end.

vii. Insurance. Annually, within thirty (30) days of the
renewal date of such insurance policy, evidence of insurance in form and
content satisfactory to Lender and otherwise in compliance with Section
8.6 of this Agreement, together with the original insurance policy.

viii. Notice of Event of Default and Adverse Business
Developments. Immediately after becoming aware of the existence of a
Default or an Event of Default or after becoming aware of any developments
or other information which is likely to adversely affect Borrower's
properties, business, prospects, profits or condition (financial or
otherwise) or its ability to perform its obligation under this Agreement
or any other Loan Documents including, without limitation, the following:

a. any dispute that may arise between Borrower and any
governmental regulatory body or law enforcement authority,
including any action relating to any tax liability of Borrower
or guarantor;

b. any labor controversy resulting in or threatening to
result in a strike or work stoppage against Borrower;

c. any proposal by any public authority to acquire the
assets or business of Borrower;

d. the location of any Collateral other than at
Borrower's place of business or as permitted under this
Agreement;

e. any proposed or actual change of Borrower's name,
identity, state of organization or corporate structure; or

f. any other matter which has resulted or may result in
a Material Adverse Effect.

In each case, Borrower will provide Lender with telephonic notice followed
by notice in a Record specifying and describing the nature of such Default,
Event of Default or development or information, and such anticipated effect.

ix. Other Information. Such other information respecting the
financial condition of Borrower or any guarantor, or any Property of
Borrower in which Lender may have a lien as Lender may, from time to time,
request. Borrower authorizes Lender to communicate directly with
Borrower's independent certified public accountants and authorizes those
accountants to disclose to Lender any and all financial statements and
other information of any kind that they may have with respect to Borrower
and its business and financial and other affairs. Lender shall treat
information so obtained as confidential. On or before the date of this
Agreement, Borrower shall deliver to Lender a letter addressed to such
accountants instructing them to comply with the provisions of this Section
6.9, which letter shall be acknowledged by such accountants.

H. ACCOUNTING. Lender may account monthly to Borrower. Each and
every account shall be deemed final, binding and conclusive upon Borrower
in all respects, as to all matters reflected therein, unless Borrower,
within fifteen (15) days after the date the account was rendered, delivers
to Lender notice in a Record of any objections which Borrower may have to
any such account and in that event only those items expressly objected to
in such notice shall be deemed to be disputed by Borrower. If Borrower
disputes the correctness of any statement, Borrower's notice shall specify
in detail the particulars of its basis for contending that such statement
is incorrect.

I. AFFIRMATIVE COVENANTS. Borrower represents and warrants that, so
long as it shall have any Obligations to Lender under this Agreement,
Borrower will:

i. Business and Existence. Preserve and maintain Borrower's
separate existence and rights, privileges and franchises.

ii. Trade Names. Transact business in Borrower's own name and
invoice all of Borrower's Receivables in Borrower's own name.

iii. Intentionally Left Blank.

iv. Taxes. Pay and discharge all taxes, assessments,
government charges and levies imposed upon Borrower, Borrower's income or
Borrower's profits or upon any Property belonging to Borrower prior to the
date on which penalties attach thereto, except where the same may be
contested in good faith by appropriate proceedings being diligently
conducted. Borrower will pay all taxes, assessments, governmental charges
or private encumbrances levied, assessed, imposed or payable upon or with
respect to the Inventory, the equipment or any other Collateral or any
part thereof.

v. Compliance with Laws. Comply with all Governmental Rules
applicable to Borrower including, without limitation, all laws and
regulations regarding

the collection, payment and deposit of employees' income, unemployment and
Social Security taxes.

vi. Maintain Properties: Insurance. Safeguard and protect all
Property used in the conduct of Borrower's business and keep all of
Borrower's Property insured with insurance companies licensed to do
business in the states where the Property is located against loss or
damage by fire or other risk under extended coverage endorsement and
against theft, burglary, and pilferage together with such other hazards as
Lender may from time to time request, in amounts satisfactory to Lender.
Borrower shall deliver the policy or policies of such insurance or
certificates of insurance to Lender containing endorsements in form
satisfactory to Lender naming Lender as lender, loss payee and additional
insured and providing that the insurance shall not be canceled, amended or
terminated except upon thirty (30) days' prior written notice to Lender.
All insurance proceeds received by Lender shall be retained by Lender for
application to the payment of such portion of the Obligations as Lender
may determine in Lender's sole discretion. Borrower shall promptly notify
Lender of any event or occurrence causing a loss or decline in the value
of Property insured or the existence of an event justifying a claim under
any insurance and the estimated amount thereof.

vii. Business Records. Keep adequate records and books of
account with respect to Borrower's business activities in which proper
entries are made in accordance with sound bookkeeping practices reflecting
all financial transactions of Borrower; and Borrower shall maintain all of
its Bank Accounts as set forth on Schedule 5.23 of this Agreement.

viii. Litigation. Give Lender prompt notice of any suit at law
or in equity against Borrower involving money or property valued in excess
of Fifty Thousand and 00/100 Dollars ($50,000.00) except where the same is
fully covered by insurance and the insurer has accepted liability
therefore in writing.

ix. Damage or Destruction of Collateral. Maintain or cause to
be maintained the Collateral and all its Properties in good condition and
repair at all times, preserve the Collateral and all its other Properties
from loss, damage, or destruction of any nature whatsoever and provide
Lender with prompt notice in a Record of any destruction or substantial
damage to any Collateral subject to Lender's security interest and of the
occurrence of any condition or event which has caused, or may cause, loss
or depreciation in the value of any Collateral.

x. Name Change. Provide Lender with not fewer than thirty (30)
days notice in an Authenticated Record prior to any proposed change of
name or the creation of any subsidiary.

xi. Access to Books and Records. Provide Lender with such
reports and with such access to Borrower's books and records and permit
Lender to copy and inspect such reports and books and records all, as
Lender deems necessary or desirable to enable Lender to monitor the credit
facilities extended hereby. Lender may examine and inspect the Inventory,
equipment or other Collateral and may examine, inspect and copy

all books and records with respect thereto at any time during Borrower's
normal business hours. Borrower shall maintain full, accurate and complete
records respecting the Inventory, including a perpetual inventory, and all
other Collateral at all times.

xii. Solvent. Continue to be Solvent.

xiii. Compliance With Environmental Laws. Comply with all
applicable Environmental Laws.

xiv. Compliance with ERISA and other Employment Laws. Comply
with all applicable provisions of ERISA and the Internal Revenue Code of
1986, as amended, and any other applicable laws, rules or regulations
relating to the compensation of employees and funding of employee pension
plans.

xv. Proceeds of Collateral. Forthwith upon receipt, pay to
Lender the proceeds of all Collateral, whereupon such proceeds shall be
applied to the Obligations in such order and manner as shall be determined
in the sole and absolute discretion of Lender.

xvi. Delivery of Documents. Notify Lender if any proceeds of
Receivables shall include, or any of the Receivables shall be evidenced
by, notes, trade acceptances or instruments or documents, or if any
Inventory is covered by documents of title or chattel paper, whether or
not negotiable, and if required by Lender, immediately deliver them to
Lender appropriately endorsed. Borrower waives protest regardless of the
form of the endorsement. If Borrower fails to endorse any instrument or
document, Lender is authorized to endorse it on Borrower's behalf.

J. NEGATIVE COVENANTS. So long as Borrower shall have any Obligation
to Lender under this Agreement and unless Lender has first consented
thereto in an Authenticated Record, Borrower shall not:

i. Indebtedness. Create, incur, assume or suffer to exist,
voluntarily or involuntarily, any Indebtedness, except (i) Obligations to
Lender, (ii) trade debt incurred in the ordinary course of Borrower's
business as currently conducted; (iii) purchase money financing and
equipment leases not to exceed Fifty Thousand and 00/100 Dollars
($50,000.00) in any Fiscal Year; and (iv) existing Indebtedness described
on Schedule 5.18.

ii. Mergers; Consolidations; Acquisitions. Enter into any
merger, consolidation, reorganization or recapitalization with any other
Person; take any steps in contemplation of dissolution or liquidation;
conduct any part of its business through any corporate subsidiary,
unincorporated association or other Person; acquire the stock or assets of
any Person, whether by merger, consolidation, purchase of stock or
otherwise; or acquire all or any substantial part of the properties of any
Person.

iii. Sale or Disposition. Sell or dispose of all or any
Properties or grant any Person an option to acquire any such Property,
provided, however, that the

foregoing shall not prohibit sales of Inventory in the ordinary course of
Borrower's business.

iv. Defaults. Permit any landlord, mortgagee, trustee under
deed of trust or lienholder to declare a default under any lease,
mortgage, deed of trust or lien on real estate owned or leased by
Borrower, which default remains uncured after any stated cure period or
for a period in excess of thirty (30) days from its occurrence, whichever
is less, unless such default is being contested by Borrower in good faith
by appropriate proceedings being diligently conducted.

v. Limitations on Liens. Suffer any lien, encumbrance,
mortgage or security interest on any of its Property, except such liens as
appear on Schedule 5.17 attached hereto, if any.

vi. Dividends and Distributions. Pay any cash dividends, make
any capital distribution in cash or other Property or return of capital,
or purchase or redeem any of its stock or other securities, or retire any
of its stock, or take any action which would have an effect equivalent to
any of the foregoing. Notwithstanding the foregoing, Borrower may make (i)
periodic payments to Xxxxxx Holdings, Inc. and/or Xxxxxx Technologies,
Inc. solely to make periodic interest payments due on its promissory note
to Xxxxxx X. Xxxxxxxxxxx, Xx. in the original principal amount of
$40,556.02 dated December 20, 2002, and its promissory note to Xxxxxxxx X.
Xxxxxx, Xx. in the original principal amount of $101,390.17 dated December
20, 2002 in accordance with the terms and conditions of the subordination
and pledge agreement executed by each such individual, and (ii) periodic
payments of principal and/or interest due on the promissory note payable
to Xxxxxxx Discovery Offshore Fund III, L.P. in the original principal
amount of $79,450.00 and the promissory note payable to Xxxxxxx Discovery
Fund III, L.P. in the original principal amount of $495,550.00, in
accordance with the terms and conditions of the subordination and pledge
agreement executed by each respective entity.

vii. Borrower's Name and Offices. Transfer Borrower's chief
executive office or change its organizational name or the office where it
maintains its records (including computer printouts and programs) with
respect to Receivables or any other Collateral.

viii. Fiscal Year. Change its Fiscal Year.

ix. Change of Control. Allow any current change in the
ownership structure of Borrower such that Xxxxxx Holdings, Inc. or Xxxxxx
Technologies, Inc. is not the sole shareholder of Borrower.

x. Guaranties; Contingent Liabilities. Assume, guarantee,
endorse, contingently agree to purchase or otherwise become liable upon
the obligation of any Person, except by the endorsement of negotiable
instruments for deposit or collection or similar transactions in the
ordinary course of its business as currently conducted.

xi. Removal of Collateral. Remove, or cause or permit to be
removed, any of the Collateral or other Property from the premises where
such Collateral

or Property is currently located and as set forth on Schedule 5.14, 5.15
or 5.16 of this Agreement, except for sales of Inventory in the ordinary
course of business as currently conducted and except as provided in
Sections 5.14, 5.15 or 5.16.

xii. Transfer of Notes or Accounts. Sell, assign, transfer,
discount or otherwise dispose of any Receivables or any promissory note or
other instrument payable to it with or without recourse.

xiii. Settlements. Compromise, settle or adjust any claim
relating to any of the Collateral.

xiv. Change of Business. Cause or permit a change in the
nature of its business as conducted on the date of this Agreement.

xv. Change of Accounting Practices. Change its present
accounting principles or practices in any respect, except, upon notice to
Lender in a Record, as may be required by changes in GAAP.

xvi. Inconsistent Agreement. Enter into any agreement
containing any provision which would be violated by the performance of
Borrower's Obligations or other obligations under this Agreement or any
other Loan Document.

xvii. Loan or Advances. Make any loans or advances to any
Person. For purposes of this Subsection 9.17, monetary obligation owed to
any Affiliate, subsidiary or guarantor including, without limitation,
those in connection with its performance of services or the sale of goods,
shall constitute loans or advances subject to the provisions of this
Subsection 9.17 but excluding salaries paid to employees.

xviii. Investments. Make any investment in any Person
including, without limitation, any Affiliates or form any Affiliates or
subsidiaries not existing on the date hereof.

xix. Tangible Net Worth. Permit Borrower's Tangible Net Worth
to be less than the amounts set forth below, for the period ending:

Amount Time Period
------ -----------

$330,000.00 June 30, 2003

$2,515,000.00 September 30, 2003

$2,356,000.00 December 31, 2003

$2,156,000.00 March 31, 2004

$2,406,000.00 June 30, 2004

$2,656,000.00 September 30, 2004

$2,556,000.00 December 31, 2004

$2,356,000.00 March 31, 2005

$2,656,000.00 June 30, 2005

$2,956,000.00 September 30, 2005

$2,856,000.00 December 31, 2005

$2,656,000.00 March 31, 2006

$3,006,000.00 June 30, 2006 and

until the Termination Date
-------------- ---------------------------------------

xx. Fixed Charge Coverage Ratio. Permit Borrower's Fixed
Charge Coverage Ratio for the periods set forth below to be greater than the
levels set forth below, tested quarterly based on a rolling twelve-month period:

Ratio Time Period
----- -----------

N/A

xxi. Capital Expenditures. Make or agree to make Capital
Expenditures in an amount which exceeds the levels set forth below during
the periods set forth below:

Amount Time Period
------ -----------

$375,000.00 Fiscal Year 2003

$425,000.00 Fiscal Year 2004

$475,000.00 Fiscal Year 2005

$525,000.00 Fiscal Year 2006 prorated
through the Termination Date
--------------------- ----------------------------------------

xxii. Transactions with Affiliates. Engage in any transaction
with any of Borrower's Affiliates except the Indebtedness described on
Schedule 5.18 hereof.

xxiii. EBITDA. Permit Borrower's EBITDA to be less than the
following during the time periods set forth below tested quarterly based
on a rolling twelve-month period:

Amount Time Period
------ -----------

($1,308,700.00) For the period ended June 30, 2003

$147,050.00 For the period ended September 30, 2003

$1,106,700.00 For the period ended December 31, 2003

$1,108,910.00 For the period ended March 31, 2004

$1,146,820.00 For the period ended June 30, 2004

$1,216,435.00 For the period ended September 30, 2004

$1,217,710.00 For the period ended December 31, 2004

$1,220,005.00 For the period ended March 31, 2005

$1,260,737.00 For the period ended June 30, 2005

$1,337,314.00 For the period ended September 30, 2005

$1,339,787.00 For the period ended December 31, 2005

$1,342,189.00 For the period ended March 31, 2006 and
thereafter through the Termination Date

K. CONDITIONS TO ADVANCES.

i. Lender's Right to Take Certain Actions. Lender's obligation
to make any Advance is subject to the condition that, as of the date of
the Advance, no Default or Event of Default shall have occurred and be
continuing and that the matters set forth in Article 5 of this Agreement
and the representations and covenants set forth in the other Loan
Documents continue to be true and complete. Borrower's acceptance of each
Advance under this Agreement shall constitute a confirmation, as of the
date of the Advance, of the matters set forth in Article 5 of this
Agreement, of the representations and covenants set forth in the other
Loan Documents, and that no Default or Event of Default then exists. If
requested by Lender, Borrower shall further confirm such matters by
delivery of a Record dated the day of the Advance and signed by an
authorized officer of Borrower.

L. TERM. Unless sooner terminated by Lender pursuant to the terms of
this Agreement, the period during which the Revolving Loan shall be
available shall initially be a period commencing on the date hereof and
concluding on the Termination Date.

M. EVENTS OF DEFAULT.

i. Defaults. Upon the happening of any of the following events
(individually, an "Event of Default," collectively, "Events of Default"):

a. if Borrower shall fail to make any payment when due
on any Obligation under this Agreement or any other Loan
Document; or

b. if Borrower shall fail to comply with any term,
condition, covenant, warranty or representation contained in
Articles 6 or 9 of this Agreement; or

c. if Borrower shall fail to comply with any term,
condition, covenant or warranty of or in this Agreement other
than in Articles 6 or 9 of this Agreement, and such failure
continues for a period in excess of ten (10) days after notice
thereof is given by Lender to Borrower; or

d. if Borrower shall fail to comply with any term,
condition, covenant, warranty or representation contained in
any of the other Loan Documents or any other agreement between
Lender and Borrower; or

e. if Borrower shall cease to be Solvent, make an
assignment for the benefit of its creditors, call a meeting of
its creditors to obtain any general financial accommodation,
suspend business or if a case under any provision of the
Bankruptcy Code including provisions for reorganizations,
shall be commenced by or against Borrower or if a receiver,
trustee or equivalent officer shall be appointed for all or
any of the Properties of Borrower; or

f. if any statement or representation contained in any
financial statement or certificate delivered by Borrower to
Lender shall be false, in any respect, when made; or

g. if any Federal or state tax lien is filed of record
against Borrower and is not bonded or discharged within ten
(10) days of filing; or

h. if Borrower's independent certified public
accountants shall refuse to deliver any financial statement
required by this Agreement; or

i. if a judgment for more than One Hundred Thousand and
00/100 Dollars ($100,000.00) shall be entered against Borrower
in any action or proceeding and shall not be stayed, vacated,
bonded, paid or discharged within ten (10) days of entry,
except a judgment where the

claim is fully covered by insurance and the insurance company
has accepted liability therefore in writing; or

j. if any obligation of Borrower in respect of any
Indebtedness (other than Indebtedness to Lender) shall be
declared to be or shall become due and payable prior to its
stated maturity or such obligation shall not be paid as and
when the same becomes due and payable; or there shall occur
any event or condition which constitutes an event of default
under any mortgage, indenture, instrument, agreement or
evidence of Indebtedness relating to any obligation of
Borrower in respect of any such Indebtedness the effect of
which is to permit the holder or the holders of such mortgage,
indenture, instrument, agreement or evidence of Indebtedness,
or a trustee, agent or other representative on behalf of such
holder or holders, to cause the Indebtedness evidenced thereby
to become due prior to its stated maturity; or

k. upon the happening of any Reportable Event which
Lender in its sole discretion determines might constitute
grounds for the termination of any Plan, or if a trustee shall
be appointed by an appropriate United States District Court or
other court or administrative tribunal to administer any Plan,
or if the Pension Benefit Guaranty Corporation shall institute
proceedings to terminate any Plan or to appoint a trustee to
administer any Plan; or

l. upon the occurrence and continuance of any Material
Adverse Effect, which in the sole and absolute opinion of
Lender, impairs Lender's security, increases Lender's risks or
impairs Borrower's ability to perform under this Agreement or
under the other Loan Documents; or

m. upon the happening of any of the events described in
Subsections 12.1 (d), (e), (f), (g), (h), (i) or (j) with
respect to any guarantor or if any such guarantor purports to
terminate its guaranty or upon the death of a guarantor that
is a natural person, if any; or

n. if either Xxxxx X. Xxxxxxx or Xxxxx X. Xxxxxxx does
not occupy the same position with Borrower as at the time of
the closing of the Loans or is not actively engaged in the
day-to-day operations of Borrower's business unless within
sixty (60) days of such event, (i) an individual is hired by
Borrower to perform substantially the same duties as Xxxxx X.
Xxxxxxx or Xxxxx X. Xxxxxxx, as the case may be; (ii) such
individual and their qualifications and experience are
acceptable to Lender which approval will not be unreasonably
withheld; and (iii) such individual executes a validity and
support agreement in substantially the same form as the
validity and support agreement executed by Xxxxx X. Xxxxxxx or
Xxxxx X. Xxxxxxx, as the case may be.

Then, and in any such event, Lender may terminate this Agreement
without prior notice or demand to Borrower or may demand payment in full of all
Obligations (whether otherwise then payable on demand or not) without
terminating this Agreement and shall, in any event, be under no further
responsibility to extend any credit or afford any financial accommodation to
Borrower, whether under this Agreement or otherwise.

ii. Obligations Immediately Due. Upon the Termination Date for
any reason, all of Borrower's Obligations to Lender including, but not
limited to, the Loans shall immediately become due and payable without
further notice or demand.

iii. Continuation of Security Interests. Notwithstanding any
termination, until all Obligations of Borrower shall have been fully paid
and satisfied, Lender shall retain all security in and title to all
existing and future Receivables, General Intangibles, Inventory,
Equipment, Fixtures, Investment Property, and other Collateral held by
Lender under the General Security Agreement or under any other Loan
Document and Borrower shall continue to assign Receivables and consign
Inventory to Lender and continue to turn over all proceeds of Collateral
to Lender.

iv. Lockbox. Upon the occurrence of and during the
continuation of an Event of Default, Lender shall have the right to
require Borrower to establish a Lockbox over which Lender shall have the
sole power of withdrawal. Upon the establishment of such Lockbox, all
proceeds of Collateral, whether cash, checks, drafts, notes, acceptances
or other forms of payment including, without limitation, electronic
payment if received by Borrower, shall be received by Borrower in trust
for Lender and Borrower shall deliver or cause to be delivered such
payments forthwith, in the identical form in which received, to Lender or
to the Lockbox, as Lender shall require from time to time.

N. REMEDIES OF LENDER. Upon the occurrence of any Event of Default
or upon any termination of this Agreement, then Lender shall have, in
addition to all of its other rights under this Agreement all of the rights
and remedies provided in the General Security Agreement.

O. GENERAL PROVISIONS.

i. Rights Cumulative. Lender's rights and remedies under this
Agreement shall be cumulative and non-exclusive of any other rights or
remedies which Lender may have under any other agreement or instrument, by
operation of law or otherwise.

ii. Successors and Assigns. This Agreement is entered into for
the benefit of the parties hereto and their successors and assigns. It
shall be binding upon and shall inure to the benefit of the parties, their
successors and assigns. Lender shall have the right, without the necessity
of any further consent or authorization by Borrower, to sell, assign,
securitize or grant participation in all, or a portion of, Lender's
interest in the Loans, to other financial institutions of the Lender's
choice and on such terms as are acceptable to Lender in its sole
discretion.

iii. Notice. Wherever this Agreement provides for notice to
any party (except as expressly provided to the contrary), it shall be
given by messenger, facsimile transmission, certified U.S. mail with
return receipt requested, or nationally recognized overnight courier with
receipt requested, effective when either received or receipt rejected by
the party to whom addressed, and shall be addressed as follows, or to such
other address as the party affected may hereafter designate:

If to Lender: Keltic Financial Partners, LP
Attn: Xxxx X. Xxxxxx, Managing Partner
000 Xxxxxxxx Xxxxx Xxxxxx, Xxxxx X-000
Xxx, Xxx Xxxx 00000
Fax: (000) 000-0000

With a copy to: Xxxxxxx X. Xxxx, Esq.
Xxxx & Xxxxxx LLC
0000 Xxxxx 000 Xxxxx
XX Xxx 00
Xxxxxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000

If to Borrower: Xxxxxx Technologies Company
000 Xxxxx Xxxxxxxxxx Xxxx
Xxxxx Xxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000

With a copy to: Xxxxxxx X. Xxxxxxxxxxx, Esq.
Xxxxxx Technologies Company
000 Xxxxx Xxxxxxxxxx Xxxx
Xxxxx Xxxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000

iv. Strict Performance. The failure, at any time or times
hereafter, to require strict performance by Borrower of any provision of
this Agreement shall not waive, affect or diminish any right of Lender
thereafter to demand strict compliance and performance therewith. Any
suspension or waiver by Lender of any Default or Event of Default by
Borrower under this Agreement or any other Loan Document shall not
suspend, waive or affect any other Default or Event of Default by Borrower
under this Agreement or any other Loan Document, whether the same is prior
or subsequent thereto and whether of the same or a different type.

v. Waiver. Borrower waives presentment, protest, notice of
dishonor and notice of protest upon any instrument on which it may be
liable to Lender as maker, endorser, guarantor or otherwise.

vi. Construction of Agreement. The parties hereto agree that
the terms and language of this Agreement were the result of negotiations
between the parties, and, as a result, there shall be no presumption that
any ambiguities in this Agreement shall be resolved against either party.
Any controversy over the construction of this Agreement shall be decided
mutually without regard to events of authorship or negotiation.

vii. Expenses. If, at any time or times prior or subsequent to
the date hereof, regardless of whether or not a Default or an Event of
Default then exists or any of the transactions contemplated under this
Agreement are concluded, Lender employs counsel for advice or other
representation, or incurs legal expenses, or consulting fees and expenses,
or other costs or out-of-pocket expenses in connection with: (a) the

negotiation and preparation of this Agreement or any other Loan Document,
or any amendment of or modification of this Agreement or any other Loan
Document; (b) the administration of this Agreement or any of the other
Loan Documents and the transactions contemplated hereby and thereby; (c)
periodic audits and appraisals performed by Lender; (d) any litigation,
contest, dispute, suit, proceeding or action (whether instituted by
Lender, Borrower or any other Person) in any way relating to the
Collateral, this Agreement or any other Loan Document or Borrower's
affairs; (e) the perfection of any lien on the Collateral; (f) any attempt
to enforce any rights or remedies of Lender against Borrower or any other
Person which may be obligated to Lender by virtue of this Agreement or any
other Loan Document including, without limitation, the Account Debtors; or
(g) any attempt to inspect, verify, protect, preserve, restore, collect,
sell, liquidate or otherwise dispose of or realize upon the Collateral;
then, in any such event, the actual reasonable attorneys' fees and
expenses arising from such services and all reasonable expenses, costs,
charges and other fees of such counsel of Lender or relating to any of the
events or actions described in this Section 14.7 shall be payable by
Borrower to Lender, and shall be additional Obligations under this
Agreement secured by the Collateral. Additionally, if any taxes (excluding
taxes imposed upon or measured by the net income of Lender, but including
any intangibles tax, stamp tax or recording tax) shall be payable on
account of the execution or delivery of this Agreement, or the execution,
delivery, issuance or recording of any other Loan Document, or the
creation of any of the Obligations under this Agreement, by reason of any
existing or hereafter enacted Federal or state statute, Borrower will pay
(or will promptly reimburse Lender for the payment of) all such taxes
including, but not limited to, any interest and penalties thereon, and
will indemnify, defend and hold Lender harmless from and against any
liability in connection therewith. Borrower shall also reimburse Lender
for all other expenses incurred by Lender in connection with the
transactions contemplated under this Agreement or the other Loan
Documents, including, without limitation, fees in connection with any bank
account, the Lockbox, wire charges, automatic clearing house fees and
other similar costs and expenses.

viii. Reimbursements Charged to Revolving Loan. With respect
to any amount advanced by Lender and required to be reimbursed by Borrower
pursuant to the foregoing provisions of Section 14.7, it is hereby agreed
that Lender may charge any such amount to Borrower's Revolving Loan on the
dates such reimbursement is made. Borrower's obligations under Section
14.7 shall survive termination of the other provisions of this Agreement.

ix. Waiver of Right to Jury Trial.

A. Borrower and Lender recognize that in matters related to the
Loans and this Agreement, and as it may be subsequently modified and/or amended,
any such party may be entitled to a trial in which matters of fact are
determined by a jury (as opposed to a trial in which such matters are determined
by a Federal or state judge). By execution of this Agreement, Lender and
Borrower will give up their respective right to a trial by jury. Borrower and
Lender each hereby expressly acknowledge that this waiver is entered into to
avoid delays, minimize trial expenses, and streamline the legal proceedings in
order to accomplish a quick resolution of

claims arising under or in connection with the Revolving Note, the Term Note and
this Agreement.

B. WAIVER OF JURY TRIAL. TO THE MAXIMUM EXTENT NOT PROHIBITED BY
LAW, BORROWER AND LENDER EACH HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES ANY RIGHT THAT BORROWER OR LENDER MAY HAVE TO A TRIAL BY JURY IN RESPECT
TO ANY LITIGATION, DIRECTLY OR INDIRECTLY, AT ANY TIME ARISING OUT OF, UNDER, OR
IN CONNECTION WITH THE LOANS, THIS AGREEMENT, OR ANY TRANSACTION CONTEMPLATED
THEREBY OR HEREBY, BEFORE OR AFTER MATURITY.

C. CERTIFICATIONS. BORROWER HEREBY CERTIFIES THAT NEITHER ANY
REPRESENTATIVE NOR AGENT OF LENDER NOR LENDER'S COUNSEL HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, OR IMPLIED THAT LENDER WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER. BORROWER ACKNOWLEDGES THAT
LENDER HAS BEEN INDUCED TO ENTER INTO THE TRANSACTIONS BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATION HEREIN.

x. Indemnification by Borrower/Waiver of Claims. Borrower
hereby covenants and agrees to indemnify, defend (with counsel selected by
Lender) and hold harmless Lender and its officers, partners, employees,
consultants and agents from and against any and all claims, damages,
liabilities, costs and expenses (including, without limitation, the actual
fees and expenses of counsel) which may be incurred by or asserted against
Lender or any such other Person in connection with:

a. any investigation, action or proceeding arising out
of or in any way relating to this Agreement, any of the Loans,
any of the other Loan Documents, any other agreement relating
to any of the Obligations, any of the Collateral, or any act
or omission relating to any of the foregoing; or

b. any taxes, liabilities, claims or damages relating to
the Collateral or Lender's liens thereon; or

c. the correctness, validity or genuineness of any
instrument or document that may be released or endorsed to
Borrower by Lender (which shall automatically be deemed to be
without recourse to Lender in any event), or the existence,
character, quantity, quality, condition, value or delivery of
any goods purporting to be represented by any such documents;
or

d. any broker's commission, finder's fee or similar
charge or fee in connection with the Loans and the
transactions contemplated in this Agreement.

xi. Savings Clause for Indemnification. To the extent that the
undertaking to indemnify, pay and hold harmless set forth in Section 14.10
above may be

unenforceable because it is violative of any law or public policy,
Borrower shall contribute the maximum portion which it is permitted to pay
and satisfy under applicable law to the payment and satisfaction of all
matters referred to under Section 14.10.

xii. Waiver. To the extent permitted by applicable law, no
claim may be made by Borrower or any other Person against Lender or any of
its Affiliates, partners, officers, employees, agents, attorneys or
consultants for any special, indirect, consequential or punitive damages
in respect of any claim for breach of contract, tort or any other theory
of liability arising out of or related to the transactions contemplated by
this Agreement or the other Loan Documents or any act, omission or event
occurring in connection therewith; and Borrower hereby waives, releases
and agrees not to xxx upon any claim for any such damages, whether or not
accrued and whether or not known or suspected to exist in its favor.
Neither Lender nor any of its Affiliates, partners, officers, employees,
agents, attorneys or consultants shall be liable for any action taken or
omitted to be taken by it or them under or in connection with this
Agreement or the transactions contemplated hereby, except for its or their
own gross negligence or willful misconduct.

xiii. Entire Agreement; Amendments; Lender's Consent. This
Agreement (including the Exhibits and Schedules thereto) and the other
Loan Documents supersede, with respect to their subject matter, all prior
and contemporaneous agreements, understandings, inducements or conditions
between the respective parties, whether express or implied, oral or
written. No amendment or waiver of any provision of this Agreement or any
other Loan Document, nor consent to any departure by Borrower therefrom,
shall in any event be effective unless the same shall be in a Record
Authenticated by Lender, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for
which given.

xiv. Cross Default; Cross Collateral. Borrower hereby agrees
that (a) all other agreements between Borrower and Lender are hereby
amended so that a Default or an Event of Default under this Agreement is a
default under all such other agreements and a default under any one of the
other agreements is a Default or an Event of Default under this Agreement,
and (b) the Collateral under this Agreement secures the Obligations now or
hereafter outstanding under all other agreements between Borrower and
Lender and the Collateral pledged under any other agreement with Lender
secures the Obligations under this Agreement.

xv. Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute
but one and the same agreement.

xvi. Severability of Provisions. Any provision of this
Agreement or any of the other Loan Documents that 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 this Agreement or the other Loan
Documents or affecting the validity or enforceability of such provision in
any other jurisdiction.

xvii. Table of Contents; Headings. The table of contents and
headings preceding the text of this Agreement are inserted solely for
convenience of reference and shall not constitute a part of this Agreement
or affect its meaning, construction or effect.

xviii. Exhibits and Schedules. All of the Exhibits and
Schedules to this Agreement are hereby incorporated by reference herein
and made a part hereof.

P. GOVERNING LAW; CONSENT TO JURISDICTION.

(A) THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY LENDER
AND ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE
REVOLVING NOTE DELIVERED PURSUANT THERETO WERE DISBURSED FROM THE STATE OF
NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO
THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREIN, AND IN ALL
RESPECTS, INCLUDING MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE AND ANY
APPLICABLE LAW OF THE UNITED STATES OF AMERICA EXCEPT THAT AT ALL TIMES
THE PROVISIONS FOR THE CREATION, PERFECTION, AND ENFORCEMENT OF THE LIENS
AND SECURITY INTERESTS CREATED PURSUANT HERETO AND PURSUANT TO THE OTHER
LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAW OF
THE STATE IN WHICH THE APPLICABLE INDIVIDUAL PROPERTY IS LOCATED, IT BEING
UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED BY THE LAW OF SUCH STATE,
THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE VALIDITY AND THE
ENFORCEABILITY OF ALL LOAN DOCUMENTS AND ALL OF THE INDEBTEDNESS OR
OBLIGATIONS ARISING HEREUNDER OR THEREUNDER. TO THE FULLEST EXTENT
PERMITTED BY LAW, LENDER AND BORROWER HEREBY UNCONDITIONALLY AND
IRREVOCABLY WAIVE ANY CLAIM TO ASSERT THAT THE LAW OF ANY OTHER
JURISDICTION GOVERNS THIS AGREEMENT AND THE REVOLVING NOTE, AND THIS
AGREEMENT AND THE REVOLVING NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

(B) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR
BORROWER, ANY GUARANTOR OR OTHER PARTY TO THIS TRANSACTION ARISING OUT OF OR
RELATING TO THIS AGREEMENT SHALL BE INSTITUTED IN THE SOLE OPTION OF LENDER IN
ANY FEDERAL OR STATE COURT LOCATED IN WESTCHESTER COUNTY, NEW YORK, PURSUANT TO
ss. 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND LENDER AND BORROWER
WAIVE ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF
ANY SUCH SUIT, ACTION OR PROCEEDING, AND LENDER AND BORROWER HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING.
BORROWER SHALL DESIGNATE FROM TIME TO TIME AN AUTHORIZED AGENT HAVING AN OFFICE
IN THE STATE OF NEW YORK TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY
AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING AND
AGREES THAT SERVICE OF PROCESS UPON SUCH AGENT AT SUCH ADDRESS AND WRITTEN
NOTICE OF SUCH SERVICE ON SUCH BORROWER MAILED OR DELIVERED TO SUCH BORROWER IN
THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF
PROCESS UPON SUCH BORROWER IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE
OF NEW YORK. BORROWER (I) SHALL GIVE PROMPT NOTICE TO LENDER OF ANY CHANGE OF
ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II) MAY AT ANY TIME AND FROM TIME TO
TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW
YORK (WHICH OFFICE SHALL BE DESIGNATED AS THE ADDRESS FOR SERVICE OF PROCESS),
AND (III) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT
CEASES TO HAVE AN OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A
SUCCESSOR. BORROWER REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS CONSENT TO
JURISDICTION PROVISION

WITH ITS LEGAL COUNSEL, AND HAS MADE THIS WAIVER KNOWINGLY AND
VOLUNTARILY.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers thereunto duly authorized on the day and year first
above written.

KELTIC FINANCIAL PARTNERS, LP
By: KELTIC FINANCIAL SERVICES LLC,
its general partner

By: /s/ Xxxx X. Xxxxxx
---------------------------------------------
Name: Xxxx X. Xxxxxx
Title: Managing Partner

XXXXXX TECHNOLOGIES COMPANY

By: /s/ Xxxxx X. Xxxxxxx
---------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President and Chief Operating
Officer

2. EXHIBIT A

a) REVOLVING NOTE

$4,600,000.00............................................. May 30, 2003
Rye, New York

FOR VALUE RECEIVED, XXXXXX TECHNOLOGIES COMPANY a corporation
organized and existing under the laws of the State of Tennessee, having an
address at 000 Xxxxx Xxxxxxxxxx Xxxx, Xxxxx Xxxxx, Xxx Xxxx 00000 ("Borrower"),
promises to pay to the order of KELTIC FINANCIAL PARTNERS, LP ("Lender"), at 000
Xxxxxxxx Xxxxx Xxxxxx, Xxxxx X-000, Xxx, Xxx Xxxx 00000 or at such other place
as Lender may from time to time in writing designate, the principal sum of each
Advance made by Lender to Borrower under that certain revolving loan agreement
dated even date herewith between Borrower and Lender as it may be subsequently
amended and/or modified (collectively, the "Loan Agreement") (the Loan Agreement
together with all of the other documents, instruments or agreements executed in
connection therewith, as the same may be modified, amended, restated or replaced
from time to time are hereinafter collectively referred to as, the "Loan
Documents"). The aggregate unpaid principal balance hereof shall not exceed at
any time the sum of FOUR MILLION SIX HUNDRED THOUSAND and 00/100 Dollar
($4,600,000.00). Capitalized terms used herein and not otherwise defined shall
have the meaning given such terms in the Loan Documents. The entire unpaid
principal balance hereof, together with the accrued interest thereon and accrued
late charges, if any, and all other sums due hereunder and under the Loan
Documents shall be due and payable on the Termination Date.

Borrower also promises to pay interest to Lender monthly, in
arrears, on the first day of each month commencing on June 1, 2003 on the
average daily unpaid principal balance of this Note at the rate set forth in
Section 3.1 of the Loan Agreement.

This is the "Revolving Note" referred to in the Loan Agreement and
is entitled to the benefit of all of the terms and conditions and the security
of all of the security interests and liens granted by Borrower or any other
person to Lender pursuant to the Loan Agreement or any other Loan Document
including, without limitation, provisions regarding mandatory and optional
prepayment rights. Upon the occurrence of any Event of Default, the entire
unpaid principal amount owed Lender hereunder shall become immediately due and
payable without further notice or demand.

Whenever any payment to be made under this Note shall be stated to
be due on a day other than a Banking Day, such payment shall be made on the next
succeeding Banking Day and such extension of time shall be included in the
computation of any interest then due and payable hereunder.

The undersigned and all other parties who, at any time, may be
liable hereon in any capacity waive presentment, demand for payment, protest and
notice of dishonor of this Note. This Note and any provision hereof may not be
waived, modified, amended or discharged orally, but only by an agreement in
writing which is signed by the holder and the party or parties against whom
enforcement of any waiver, change, modification, amendment or discharge is
sought.

This Note shall be governed by and construed under the internal laws
of the State of New York, as the same may from time to time be in effect,
without regard to principles of conflicts of laws thereof.

IN WITNESS WHEREOF, the undersigned has executed this Note the day
and year first above written.

WITNESS:. XXXXXX TECHNOLOGIES COMPANY

___________________________ By:____________________________________
Xxxxxxx X. Xxxxxxxxxxx, Esq. Name: Xxxxx X. Xxxxxxx
Title: President and Chief Operating
Officer

3. EXHIBIT B

a) TERM NOTE

$400,000.00 May 30, 2003
Rye, New York

FOR VALUE RECEIVED, XXXXXX TECHNOLOGIES COMPANY, a corporation
organized and existing pursuant to the laws of the State of Tennessee having an
address at 000 Xxxxx Xxxxxxxxxx Xxxx, Xxxxx Xxxxx, Xxx Xxxx 00000 ("Borrower"),
promises to pay to the order of KELTIC FINANCIAL PARTNERS, LP ("Lender") a
Delaware limited partnership with a place of business at 000 Xxxxxxxx Xxxxx
Xxxxxx, Xxxxx X-000, Xxx, Xxx Xxxx 00000, or at such other place as Lender may
from time to time in writing designate, the sum of FOUR HUNDRED THOUSAND DOLLARS
AND 00/100 ($400,000.00) as follows: equal monthly installments each in the
amount of $6,666.67 commencing on July 1, 2003 and payable on the first day of
each month thereafter through and including May 1, 2006, followed by one (1)
final payment on May 30, 2006 ("Maturity Date"), on which date all sums payable
hereunder are immediately due and payable.

Borrower also promises to pay interest to Lender monthly, in
arrears, on the first day of each month, commencing on June 1, 2003 on the
average daily unpaid principal balance of this Note at a fluctuating rate which
is equal to the Loan Interest Rate.

Notwithstanding the foregoing, after the occurrence of an Event of
Default, Borrower shall pay interest on the unpaid principal balance of this
Note at a rate which is three and one-half percent (3.5%) per annum above the
Loan Interest Rate, provided, however, in no event shall any interest to be paid
hereunder exceed the maximum rate permitted by law.

Any partial prepayments made by the undersigned will be applied
against the remaining unpaid payments due hereunder in the inverse order of the
maturity of such payments.

This is a term note referred to in the revolving loan agreement
between Borrower and Lender dated even date herewith (the "Loan Agreement")(the
Loan Agreement together with the other documents, instruments and agreements
executed in connection therewith, as they may from time to time be modified,
amended, restated or replaced are hereinafter collectively referred to as, the
"Loan Documents"). This Note is entitled to the benefits of all of the terms and
conditions and the security of all of the security interests and liens granted
by Borrower or any other person to Lender pursuant to the Loan Agreement or any
of the other Loan Documents including, without limitation, supplemental
provisions regarding mandatory and/or optional prepayment rights and premiums.
Capitalized terms used herein and not otherwise defined shall have the meaning
given such terms in the Loan Documents.

Whenever any payment to be made under this Note shall otherwise be
due on a day that is not a Banking Day, such payment shall be made on the next
succeeding Banking Day, and such extension of time shall be included in
computing interest in connection with any such payment.

This Note shall be binding upon and shall insure to the benefits of
the parties, their successors and assigns. Lender shall have the right, without
the necessity of any further consent or authorization by Borrower, to sell,
assign, securitize or grant participations in all, or a portion of, Lender's
interest in this Note, to other financial institutions of Lender's choice and on
such terms as are acceptable to Lender in its sole discretion.

Borrower and all other parties who, at any time, may be liable
hereon in any capacity waive presentment, demand for payment, protest and notice
of dishonor of this Note. This Note may not be changed orally, but only by an
agreement in writing which is signed by the holder and the party or parties
against whom enforcement of any waiver, change, modification or discharge is
sought.

IN WITNESS WHEREOF, the undersigned has executed this Note on the
day and year first above written.

WITNESS: XXXXXX TECHNOLOGIES COMPANY

__________________________ By:______________________________
Xxxxxxx Xxxxxxxxxxx, Esq. Name: Xxxxx X. Xxxxxxx
Title: President and Chief
Operating Officer

4. EXHIBIT C

FORM OF NOTICE OF BORROWING

Keltic Financial Partners, LP
555 Xxxxxxxx Xxxxx Avenue, Site X-000
Xxx Xxxx, Xxx Xxxx 00000

(1) Re: Request for loan/advance

The undersigned requests a $____________ loan advance pursuant to
Section 2.1 of the Loan Agreement dated May 30, 2003 between Keltic Financial
Partners, LP and the undersigned ("Loan Agreement"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings given to them in
the Loan Agreement.

Please wire the requested loan advance [to our operating account
number _________ at __________ or [in accordance with the following wire
instructions [insert instructions]. Please call the undersigned to confirm
receipt of this fax at ____________.

Thank you.

XXXXXX TECHNOLOGIES COMPANY

By:___________________________
Name: Xxxxx X. Xxxxxxx
Title: President and Chief
Operating Officer

5. EXHIBIT D

a) BORROWING BASE

EXHIBIT E

COMPLIANCE CERTIFICATE

XXXXXX TECHNOLOGIES COMPANY ("Borrower") hereby certifies to KELTIC
FINANCIAL PARTNERS, LP ("Lender") in accordance with the provisions of a Loan
Agreement between Borrower and Lender dated the 30th day of May, 2003, as the
same from time to time may be amended, supplemented or otherwise modified
("Agreement") that:

A. General

(i) Borrower has complied in all respects with all the terms,
covenants and conditions of the Agreement which are binding upon them;

(ii) there exists no Event of Default or Default as defined in the
Agreement;

(iii) the representations and warranties contained in the Agreement
are true in all respects with the same effect as though such representations and
warranties had been made on the date hereof; and

B. Financial Covenants

As of the date hereof or, from such period as may be designated
below, the computations and ratios as set forth below, are true and correct:

(a) Tangible Net Worth

(b) Capital Expenditures

WITNESS the signature of the undersigned duly authorized officer of
Borrower on _____________, 200___.

XXXXXX TECHNOLOGIES COMPANY

By_________________________________
Name: Xxxxx X. Xxxxxxx
Title: President and Chief
Operating Officer

Schedule 5.2

Other Names

Xxxxxx Technologies Company

dba Xxxxxx Technologies of Tennessee

dba Xxxxxx Technologies Company of Tennessee

Schedule 5.3

b) Subsidiaries and Affiliates

Parent Company is Xxxxxx Technologies, Inc. ("Parent"), a New York corporation

Parent is the sole stockholder of Xxxxxx Holding's, Inc. ("Holding"), a Nevada
Corporation

Holding is the sole stockholder of Borrower, Xxxxxx Technologies Company, a
Tennessee Corporation

The following Persons may be deemed "Affiliates" as that term is defined in
Section 1.3:

Xxxxxx Technologies, Inc.
Xxxxxx Holdings, Inc.
Xxxxxxx US Discovery Fund III, XX
Xxxxxxx US Discovery Offshore Fund III, X.X.
XxXxxx Chemical and Energy Operations, Inc.
Xxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
Xxxxxxxxx X. Xxxxxx, Xx.
Xxxxxxx X. Xxxxxxxxxxx

Schedule 5.8
Real Estate

Leased by Borrower

Facility Address Landlord Term
-------- -------- -------- ----

Champaign, Il 0000 Xxxxx Xxxxxx Xxxxxx Busey Bank 12/1/02 - 11/30/04
Champaign, Illinois 000 Xxxx Xxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000-0000

Houston, Tx. 00000 Xxxxxxxxx Xxx., Xxxxx X Two Ninety, Ltd. 7/15/00-6/30/03
Houston, Texas 0000 Xxxx Xxxxxxx
Xxxxxxx, Xxxxx 00000

Seattle, Wa. 0000 00xx Xx. XX, Xxx 00 Park 26, LLC 4/1/02 -3/31/04
Auburn, Washington c/o The Andover Company, Inc.
000 Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, XX 00000

Charlotte, NC 0000 Xxxxxxxx Xxxx Xxxxxx & Xxxxx Xxx 4/24/98 -4/23/00
Charlotte, North Carolina c/o Colliers Xxxxxxx now month to month
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000-0000

Punta Gorda, Fl. 0000 Xxxxxxxxxxxx Xxxxx Xxxx Xxxxxxxx 12/15/01 - 12/14/03
Punta Gorda, Florida 0000 Xxxxxxxxxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxx 00000

Pearl River, NY 000 X. Xxxxxxxxxx Xxxx 275 N. Middletown Road, LLC 0/0/00 - 00/00/00
Xxxxx Xxxxx, Xxx Xxxx 000 Xxxxx Xxxxxxxxxx Xxxx
Xxxxx Xxxxx, Xxx Xxxx 00000

Baton Rouge, La. 00000 Xxxxxxx Xxxxxxx Xxxxxx Family Holdings, LLC 8/1/02 - 7/31/05
Baton Rouge, Louisiana c/o Xxxx X. Xxxxxx, Xx., President
0000 Xxxxx Xxxxx Xxxx
Xxxxx Xxxxx, Xxxxxxxxx 00000

Villa Park, Il. 000 Xxxxx Xxxxxxx Xxx. HVP Partners 6/1/99 - 8/31/05
Villa Park, Illinois 00 X 000 Xxxxxxx
Xxxxxxxxxxx, Xxxxxxxx 00000

Baltimore, Md. 0000 Xxxx Xxxxxxxxx Xx. MIE Properties, Inc. 9/1/01 - 8/31/05
Baltimore, Maryland 0000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000

Rantoul, IL 000 Xxxx Xxxxxxxxx Xx. Roeco Enterprises, Inc. 10/1/97 - 9/30/02
Rantoul, Illinois XX Xxx 000 now month to month
Xxxxxxx, Xxxxxxxx 00000

Freemont, NH 1 Coopers Common Phoenix Fremont LLC 7/1/02 - 6/30/04
Freemont, New Hampshire 000 Xxxx Xxxx
Xxxxx Xxxxxxx, Xxx Xxxxxxxxx 00000

Schedule 5.8 (continued)

Leased by Parent, Xxxxxx Technologies, Inc.

Hillburn, NY 00 Xxxxx Xxxxxx Xxxx Xxxxxx Xxxx Co., Inc. 0/0/00 - 0/00/00
Xxxxxxxx, Xxx Xxxx 000 Xxxxx 00
Xxxxxxxxxx, Xxx Xxxx 00000

Owned

None

Schedule 5.9

c) Intellectual Property

i) U.S. Patents

TITLE-NAME INVENTOR OWNER DATE ISSUED NUMBER
---------- -------- ----- ----------- ------

Method & Apparatus
for Refrigerant
Reclamation X. Xxxxxx Parent 1/3/95 5,377,499

Hydraulic System
for Recovering
Refrigerants X. Xxxxxx Parent 4/2/96 5,502,974

Method & Apparatus
for Reclaiming a
Refrigerant X. Xxxxxx Borrower 6/11/91 5,022,230

Apparatus & Method
For Recovering Volatile
Refrigerants X. Xxxxxx Parent 9/8/98 5,802,859

Apparatus & Method X. Xxxxxx Parent 11/7/00 6,141,977
For Recovering Volatile
Refrigerants

Method & Apparatus
For Sonic Cleaning of
Heat Exchangers X. Xxxxxx Parent 9/18/01 6,290,778

Apparatus & Method
For Flushing a X. Xxxxxx &
Chiller System A. Mika Parent 3/19/02 6,357,240

Apparatus & Method
For Flushing a X. Xxxxxxx &
Refrigeration System A. Mika Parent 2/26/00 6,164,080

Method & Apparatus
For Measuring and
Improving Efficiency X. Xxxxxx &
In Refrigeration Systems X. Xxxxxxx Borrower 1/14/03 6,505,475

Patent Pending - Method
& Apparatus
For Measuring and X. Xxxxxx &
Improving Efficiency X. Xxxxxxx Parent filed 1/7/03 App. # 10/338,941

Schedule 5.9 (continued)

Patent Pending - Method
& Apparatus
For Measuring and
Improving Efficiency X. Xxxxxx &
In Refrigeration Systems X. Xxxxxxx Parent filed 1/7/00 App. # 09/577,703

Provisional - Method
& Apparatus
For Measuring and
Improving Efficiency in
Refrigeration Systems K..Zugibe Parent filed 12/9/02 60/431,901
Foreign license granted 3/13/2003

Provisional - Method
& Apparatus
For Optimizing
Refrigeration Systems K..Zugibe Parent filed 12/19/02 60/434,847
Foreign license granted 2/25/2003

ii) Foreign Patents

1. U.S. Patent # 5,377,499, issued to Xxxxxx Technologies, Inc., has been filed
in the following jurisdictions;

BRAZIL - Patent Issued 8/8/00 - Expires 12/6/2014, Patent #PI9404879-7 8/8/00

CANADA - Patent Issued 8/20/02 - Expires 12/8/2014, Patent #2137771

CHINA - Patent issued 11/9/2001- Expires 12/9/2014, Registration #00000

XXXXX XXXX - Patent Pending, application filed 12/7/94

ISRAEL - Patent issued 10/14/97 -Expires 12/6/14, Patent#111899

JAPAN - Patent Pending, application filed 12/8/94

MEXICO- Patent Issued 6/25/99 - Expires 12/9/14, Patent # 192486

POLAND - Patent Issued 12/1/98 - Expires 12/5/14. Patent#176 518

RUSSIA- Patent Issued 8/20/99 - Expires 8/20/14. Patent # 0000000

XXXXXX XXXXXX - Patent Issued 1/3/95- Expires 1/3/12. Patent # 5,377,499

EUROPEAN COMMUNITY - Patent Issued 3/31/99. Expires 12/8/14. Patent # 0682218
(Belgium, Denmark, France, Germany, Italy, Netherlands, Spain, Sweden,
Switzerland/Liechtenstein, United Kingdom)

2. U.S. Patent #5,022,230, issued to Xxxxxx Technologies Company, has been filed
in the following jurisdictions;

CANADA - Patent Issued 7/31/01 - Expires 5/23/2011, Patent #2,084,088

AUSTRALIA - Patent #660280

iii)

iv) Patent Licenses

Reciprocal licenses between Parent and Borrower (not formalized)

License of Borrower's Patent #5,022,230 granted to Xxxxx Xxxxxx for a total of
10 machines that were leased to Borrower in 1994, of which six were purchased by
Borrower in 2001 and four were returned to Xxxxx Xxxxxx in 2001.

v) Trademark Registrations

TITLE-NAME OWNER DATE ISSUED NUMBER
---------- ---------- ----- ----------- ------

GLACIER Parent 3/2/99 2,227,148

ZUGIBEAST Parent 7/9/96 1,985,422

HTI Parent 4/23/96 1,970,063

R-SIDE Borrower 7/30/02 2,601434

REFRIGERANTSIDE Borrower 4/9/02 2,559,214

Xxxxxx Technologies, Parent 4/23/96 1,969,986
Inc.

vi) Trademark Applications

None

vii) Trademark Licenses

All trademarks licensed to Borrower (not formalized)

viii) Copyrights

None

ix) Copyright Licenses

None

Schedule 5.13

d) Litigation

A. In June 1998, United Water of New York Inc. ("United") commenced an action
against the Xxxxxx Technologies, Inc. (the "Company") in the Supreme Court of
the State of New York, Rockland County, seeking damages in the amount of $1.2
million allegedly sustained as a result of alleged contamination of certain of
United's xxxxx which are in close proximity to the Company's Hillburn, New York
facility.

On April 1, 1999, the Company reported a release at the Company's Hillburn, New
York facility of approximately 7,800 lbs. of R-11, as a result of a failed hose
connection to one of the Company's outdoor storage tanks allowing liquid R-11 to
discharge from the tank into the concrete secondary containment area in which
the subject tank was located.

In July 1999, United amended its complaint in the Rockland County action to
allege facts relating to, and to seek damages allegedly resulting from the April
1, 1999 R-11 release.

In June 2000, the Rockland County Supreme Court approved a settlement of the
Rockland County action commenced by United. Under the settlement, the Company
paid to United the sum of $1,000,000 and has been making additional monthly
payments in the amount of $5,000, which payments are expected to continue
through December 2003. .

In June 2000, the Company signed an Order on Consent with the DEC regarding all
past contamination of the United well field, whereby, the Company agreed to
continue operating a remediation system it installed at its Hillburn facility in
May 1999, until remaining groundwater contamination has been effectively abated.
In May 2001, the Company signed an amendment to the Order on Consent with the
DEC, pursuant to which the Company installed one additional monitoring well and
modified the Company's existing remediation system to incorporate a second
recovery well. The Company is continuing to operate the remediation system
pursuant to that Order on Consent.

In May 2000, the Company's Hillburn facility was nominated by the United States
Environmental Protection Agency ("EPA") for listing on the National Priorities
List ("NPL"), pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act of 1980. The Company submitted opposition to the listing
within the sixty-day comment period. To date, no final decision has been made by
the EPA regarding the proposed listing. The Company has requested that the EPA
remove the Hillburn facility from nomination for the NPL due to the continued
reduction of contamination.

In October 2001, the Company learned that trace levels of R-11 were detected in
one of United's xxxxx that are closest to the Village of Suffern's ("Village")
well system. During February 2002, the Village expressed concern over the
possibility of R-11 reaching its well system and has advised the Company that it
was investigating available options to protect its well system. No contamination
of R-11 has ever been detected in any of the Village's xxxxx. In October 2002,
the Village advised the Company that it intends to proceed with plans to protect
its xxxxx and could look to the Company to reimburse the Village for any costs
it may incur. To date, no detailed cost estimate, formal demand or claim has
been presented by the Village.

In February 2003, the Company agreed to extend the statute of limitations
applicable to any claims that may be available to Ramapo Land Company, the
lessor of the Hillburn facility, arising out of the April 1, 1999 incident for
an additional two years. To date, no claims against the Company have been
asserted or threatened by Ramapo Land Company.

B. In February 2000, an action was commenced in the Supreme Court of the State
of New York, Rockland by XX Xxxxxxx Inc. d/b/a Dow-Tech Associates against the
Company seeking recovery of the sum of $20,000 allegedly due in connection with
the hiring of two employees by the Company. The Company maintains that the
allegations

in the complaint are without merit, that no amounts are due the plaintiff and
that the plaintiff owes $4,000 to the Company for unearned deposits.

Schedule 5.13 (continued)

B. In April 2003, NASDAQ advised the Guarantor that, based upon Guarantor's
Stock holders equity as reported in Form 10KSB for the 12 months ended December
31, 2002, the Guarantor failed to comply with Nasdaq SmallCap Market listing
requirements and was subject to delisting unless the Guarantor could demonstrate
a plan to achieve and sustain compliance with Nasdaq SmallCap Market listing
requirements. The Guarantor has submitted a plan, based upon the proposed rights
offering, to Nasdaq which the Guarantor believes will achieve and sustain
compliance.

Schedule 5.14

e) Receivables Locations

Facility Address Landlord Term
--------- ------- -------- ----

Pearl River, NY 000 X. Xxxxxxxxxx Xxxx 275 N. Middletown Road, LLC 0/0/00 - 00/00/00
Xxxxx Xxxxx, Xxx Xxxx 000 Xxxxx Xxxxxxxxxx Xxxx
Xxxxx Xxxxx, Xxx Xxxx 00000

Schedule 5.15

f) Current Inventory Locations - as of
5/22/03

Facility Address Landlord Term
-------- -------- -------- ----

Champaign, Il 0000 Xxxxx Xxxxxx Xxxxxx Busey Bank 12/1/02 - 11/30/04
Champaign, Illinois 000 Xxxx Xxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000-0000

Houston, Tx. 00000 Xxxxxxxxx Xxx., Xxxxx X Two Ninety, Ltd. 7/15/00-6/30/03
Houston, Texas 0000 Xxxx Xxxxxxx
Xxxxxxx, Xxxxx 00000

The Houston facility has been closed, and all inventory and equipment will be removed by 6/30/03

Seattle, Wa. 0000 00xx Xx. XX, Xxx 00 Park 26, LLC 4/1/02 -3/31/04
Auburn, Washington c/o The Andover Company, Inc.
000 Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, XX 00000

Borrower anticipates that the Seattle facility will be closed and all inventory and equipment
removed witching sixty (60) days.

Charlotte, NC 0000 Xxxxxxxx Xxxx Xxxxxx & Xxxxx Xxx 4/24/98 -4/23/00
Charlotte, North Carolina c/o Colliers Xxxxxxx now month to month
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000-0000

Punta Gorda, Fl. 0000 Xxxxxxxxxxxx Xxxxx Xxxx Xxxxxxxx 12/15/01 - 12/14/03
Punta Gorda, Florida 0000 Xxxxxxxxxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxx 00000

Pearl River, NY 000 X. Xxxxxxxxxx Xxxx 275 N. Middletown Road, LLC 0/0/00 - 00/00/00
Xxxxx Xxxxx, Xxx Xxxx 000 Xxxxx Xxxxxxxxxx Xxxx
Xxxxx Xxxxx, Xxx Xxxx 00000

Baton Rouge, La. 00000 Xxxxxxx Xxxxxxx Xxxxxx Family Holdings, LLC 8/1/02 - 7/31/05
Baton Rouge, Louisiana c/o Xxxx X. Xxxxxx, Xx., President
0000 Xxxxx Xxxxx Xxxx
Xxxxx Xxxxx, Xxxxxxxxx 00000

Borrower anticipates that the Baton Rouge facility will be closed and all inventory and equipment
removed witching sixty (60) days.

Villa Park, Il. 000 Xxxxx Xxxxxxx Xxx. HVP Partners 6/1/99 - 8/31/05
Villa Park, Illinois 00 X 000 Xxxxxxx
Xxxxxxxxxxx, Xxxxxxxx 00000

The Villa Park facility has been closed and all inventory and equipment will be removed by 6/30/03

Baltimore, Md. 2605 Lord Baltimore Dr. MIE Properties, Inc. 9/1/01 - 8/31/05
Baltimore, Maryland 0000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000

Rantoul, IL 000 Xxxx Xxxxxxxxx Xx. Roeco Enterprises, Inc. 10/1/97 - 9/30/02
Rantoul, Illinois XX Xxx 000 now month to month
Xxxxxxx, Xxxxxxxx 00000

The Rantoul facility will be closed and all inventory and
equipment transferred to Champaign facility within sixty (60)
days

Schedule 5.16

g) Current Equipment List and Locations

h) 1. Equipment List - See attached
Equipment List

j) 2. List of Locations - as of 5/22/03

When equipment is not in use at a customer's facility, the equipment is
maintained at the following locations:

Facility Address Landlord Term
-------- -------- -------- ----

Champaign, Il 0000 Xxxxx Xxxxxx Xxxxxx Busey Bank 12/1/02 - 11/30/04
Champaign, Illinois 000 Xxxx Xxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000-0000

Houston, Tx. 00000 Xxxxxxxxx Xxx., Xxxxx X Two Ninety, Ltd. 7/15/00-6/30/03
Houston, Texas 0000 Xxxx Xxxxxxx
Xxxxxxx, Xxxxx 00000

The Houston facility has been closed, and all inventory and equipment will be removed by 6/30/03

Seattle, Wa. 0000 00xx Xx. XX, Xxx 00 Park 26, LLC 4/1/02 -3/31/04
Auburn, Washington c/o The Andover Company, Inc.
000 Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, XX 00000

Borrower anticipates that the Seattle facility will be closed and all inventory and equipment
removed within sixty (60) days.

Charlotte, NC 0000 Xxxxxxxx Xxxx Xxxxxx & Xxxxx Xxx 4/24/98 -4/23/00
Charlotte, North Carolina c/o Colliers Xxxxxxx now month to month
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000-0000

Punta Gorda, Fl. 0000 Xxxxxxxxxxxx Xxxxx Xxxx Xxxxxxxx 12/15/01 - 12/14/03
Punta Gorda, Florida 0000 Xxxxxxxxxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxx 00000

Pearl River, NY 000 X. Xxxxxxxxxx Xxxx 275 N. Middletown Road, LLC 0/0/00 - 00/00/00
Xxxxx Xxxxx, Xxx Xxxx 000 Xxxxx Xxxxxxxxxx Xxxx
Xxxxx Xxxxx, Xxx Xxxx 00000

Baton Rouge, La. 00000 Xxxxxxx Xxxxxxx Xxxxxx Family Holdings, LLC 8/1/02 - 7/31/05
Baton Rouge, Louisiana c/o Xxxx X. Xxxxxx, Xx., President
0000 Xxxxx Xxxxx Xxxx
Xxxxx Xxxxx, Xxxxxxxxx 00000

Borrower anticipates that the Baton Rouge facility will be closed and all inventory and equipment
removed within sixty (60) days.

Villa Park, Il. 000 Xxxxx Xxxxxxx Xxx. HVP Partners 6/1/99 - 8/31/05
Xxxxx Xxxx, Xxxxxxxx 00 X 000 Xxxxxxx

Xxxxxxxxxxx, Xxxxxxxx 00000

The Villa Park facility has been closed and all inventory and
equipment will be removed by 6/30/03

Schedule 5.16 (continued)

Baltimore, Md. 2605 Lord Baltimore Dr. MIE Properties, Inc. 9/1/01 - 8/31/05
Baltimore, Maryland 0000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000

Rantoul, IL 000 Xxxx Xxxxxxxxx Xx. Roeco Enterprises, Inc. 10/1/97 - 9/30/02
Rantoul, Illinois XX Xxx 000 now month to month
Xxxxxxx, Xxxxxxxx 00000
The Rantoul facility will be closed and all inventory and equipment transferred to Champaign
facility within sixty (60) days

Hillburn, NY 00 Xxxxx Xxxxxx Xxxx Xxxxxx Xxxx Co., Inc. 0/0/00 - 0/00/00
Xxxxxxxx, Xxx Xxxx 000 Xxxxx 00
Xxxxxxxxxx, Xxx Xxxx 00000

Schedule 5.17

k) Liens

1. Xxxxxx Technologies Company

A. Financed - Equipment Loans

Acct # Item Expiration 12/31/2002 12/31/2003 12/31/2004 12/31/2005 Total
-----------------------------------------------------------------------------------------------------------------------------------

Loans - Recovery Vans Sub-Total $289,688.00 $192,926.00 $ 96,762 $289,688.00
-----------
CIT TERM LOAN $302,812.00 $186,053.00 $ 93,693 $ 23,066 $302,812.00
-------------------------------------------------------------------
Total
Indebtedness $592,500.00 $378,979.00 $ 190,455 $ 23,066 $592,500.00
-------------------------------------------------------------------

Expiration 12/31/2002 12/31/2003 12/31/2004 Total
25020 Loans-Recovery Vans
-----------------------------------
1999 Econoline - Ford Credit
Houston 0000 Xxx-00 $ 7,214.00 $ 6,633.00 $ 581.06 $ 7,214.06
1999 Chev Cube Van - GMAC
Hillburn 0280 Feb-04 $ 9,071.00 $ 7,712.00 $ 1,359.65 $ 9,071.65
1999 Frht Med Con - GMAC
Houston 0813 Feb-04 $ 14,310.00 $ 12,165.40 $ 2,144.32 $ 14,309.72
1999 Chev Cube Van - GMAC
Chicago 9744 Mar-04 $ 8,411.00 $ 6,527.00 $ 1,884.00 $ 8,411.00
1999 Chev Cube Van - GMAC
Charlotte 0665 Mar-04 $ 8,411.00 $ 6,527.00 $ 1,884.00 $ 8,411.00
1999 Frht Med Con - GMAC
Hillburn 3176 Mar-04 $ 15,271.00 $ 12,067.35 $ 3,203.83 $ 15,271.18
1999 Frht FL 70 - GMAC
Seattle 3177 Apr-04 $ 16,225.00 $ 11,970.09 $ 4,254.80 $ 16,224.89
1999 Frht FL 70 - GMAC
Chicago 3178 Apr-04 $ 16,225.00 $ 11,970.09 $ 4,254.80 $ 16,224.89
1999 Ford Econoline - Ford Credit
Seattle 5434 May-04 $ 9,148.00 $ 6,757.45 $ 2,390.83 $ 9,148.28
0000 Xxxx XX 70 - Intek Assoc
Baltimore 3175 Apr-04 $ 17,706.00 $ 13,067.01 $ 4,639.34 $ 17,706.35
Ford Econoline
Baltimore 2761 Jun-04 $ 10,039.00 $ 6,541.19 $ 3,497.71 $ 10,038.90
Ford Econoline
Baton Rouge 9771 Jun-04 $ 10,039.00 $ 6,541.19 $ 3,497.71 $ 10,038.90
Ford Econoline
Detroit 5427 Jun-04 $ 11,192.00 $ 7,292.70 $ 3,899.17 $ 11,191.87
Ford Econoline
Long Island 9772 Jun-04 $ 11,192.00 $ 7,292.70 $ 3,899.17 $ 11,191.87
Ford Econoline
Boston 5423 Jun-04 $ 11,192.00 $ 7,292.70 $ 3,899.17 $ 11,191.87
Frht Fl 70 - Intek Assoc
Detroit 6207 Jul-04 $ 20,783.00 $ 12,759.90 $ 8,023.55 $ 20,783.45
Frht Fl 70 - Intek Assoc
Boston 6206 Jul-04 $ 20,783.00 $ 12,759.90 $ 8,023.55 $ 20,783.45
Frht Fl 70 - Intek Assoc. 6208 Sep-04 $ 23,492.00 $ 12,456.00 $ 11,037.12 $ 23,493.12
Frht Fl 70 - Intek Assoc. 6209 Oct-04 $ 24,492.00 $ 12,297.00 $ 12,194.00 $ 24,491.00
Frht Fl 70 - Intek Assoc. 6210 Oct-04 $ 24,492.00 $ 12,297.00 $ 12,194.00 $ 24,491.00
--------------------------------------- -----------
Total - Loans - Recovery Vans $289,688.00 $192,926.67 $ 96,761.78 $289,688.45
--------------------------------------- -----------

Schedule 5.17 (continued)

B. Operating Leases

Item Expiration
---- ----------

Trade Winds chassis (3) Mo-Mo
Xxxxxxx Leasing Mo-Mo
Mail Machine (PR) Pitney Xxxxx May-03
Dell Computer (MD) (PR) (008) May-03
Dell Computer (PR) (010) Jun-03
Ascom Xxxxxx (NC) Mo-Mo
Neopost (LA) Nov-04
Copelco-2 Xxxxxx Fork Lift (IL) Mar-05
Mellon Leasing Fax Machine (PR) Sep-03
Mellon Leasing Fax Machine (NY) Qtr/Qtr
Mellon Leasing Fax Machine (IL) Dec-03
Sharp-Copier (IL) Dec-03
PBCC(Mailing System) (IL) Sep-05

C. Capital Leases

Item Expiration
---- ----------
Computers Jul-03
Gas Chromograph- NY Mar-03
Greentree Vendor Service NY Sept=03
Gas Chromograph- FL Mar-03
CIT/Norstar Phone Equip-NC Feb-05
Yale Forklift-GE Capital-TX Nov-04
Panas DBS Phone Sys-Xxxxx Fargo-Ch Dec-07
0000 Xxxxx Xxxxxxxxx-Xxxxxxxxx XX Nov-04
1998 Chevy Truck-Ft. Xxxxxx Fl Nov-03
Load Cells for Champaign Bulk Storage June - 08

2. Xxxxxx Technologies, Inc.

A. Operating Leases

Item Expiration
---- ----------
Postage Meter (NY) Pitney Xxxxx Qtr/Qtr
Minolta Copier (PR) Sep-04
Dell Computer (018) Jun-04
GE Capital-Xerox fax (PR) Apr-05

B. Capital Leases

Item Expiration
---- ----------
Computers Sep-03
Poweredge 2400 Server Aug-03
Toyota 5FBE-18 Elec Forklift-NC Oct-04

Schedule 5.18

l) Indebtedness

1. Obligations of Parent, Xxxxxx Technologies, Inc.

A. Convertible Debt:

Convertible Note holder Note Amount Date of Note Interest
----------------------- ----------- ------------ --------

Xxxxxxx U S Discovery Fund III, L. P. $302,000 12/20/02 10% Accrued and
1221 Avenue of the Americas, 40th Floor, Added to principal
Xxx Xxxx, Xxx Xxxx 00000

Xxxxxxx US Discovery Offshore Fund III, L.P.
1221 Avenue of the Americas, 40th Floor, $ 48,000 12/20/02 10% Accrued and
Xxx Xxxx, Xxx Xxxx 00000 Added to principal

Xxxxxxx X. Xxxxxx $ 50,000 12/20/02 10% Accrued and
20 Colonel Xxxxxxx Drive, Added to principal
Xxxxx Xxxxx, Xxx Xxxx 00000

Xxxxxxxxx X. Xxxxxx, Xx. $ 50,000 12/20/02 10% Accrued and
000 Xxxx Xxxxxx, Added to principal
Xxxxxx, Xxx Xxxx 00000

Xxxxxxx X. XxXxxxx $ 35,000 12/20/02 10% Accrued and
000 Xxxx Xxxx, Added to principal
Webster, New York 20 14580

Xxxxxx Xxxxx $ 10,000 12/20/02 10% Accrued and
00 Xxxxxx Xxxxxx, Added to principal
Xxxxxxxx, Xxx Xxxxxx 00000

Xxxxxxx US Discovery Fund III, L.P. $431,000 4/15/03 10% Accrued and
1221 Avenue of the Americas, 40th Floor, Added to principal
Xxx Xxxx, Xxx Xxxx 00000

Xxxxxxx US Discovery Offshore Fund III, L.P. $ 69,000 4/15/03 10% Accrued and
1221 Avenue of the Americas, 40th Floor, Added to principal
Xxx Xxxx, Xxx Xxxx 00000

Schedule 5.18 (continued)

Exchange Note holder Note Amt. Date of Note Interest
-------------------- --------- ------------ --------

Xxxxx X. Xxxxxxx
at 00 Xxxxxxxxxxxx Xxxxxx, $15,214.75 12/20/02 10% Accrued and
Xxxxx Xxxxx, Xxx Xxxx 00000 Added to principal

Xxxxxxx X. Xxxxxxxxxxx $50,715.84 12/20/02 10% Accrued and
0 Xxxxxxxx Xxxxx Added to principal
Xxxxxxx, Xxx Xxxx 00000

Xxxxxx X. Xxxxxxxxxxx, Xx. $40,556.07 12/20/02 10% - interest paid
000 Xxxxxx Xxxxxx in cash on interest
Xxxxxx, Xxx Xxxx 00000 payment dates

Xxxxxxx US Discovery Fund III, L.P. $349,939.27 12/20/02 10% Accrued and
1221 Avenue of the Americas, 40th Floor, Added to principal
Xxx Xxxx, Xxx Xxxx 00000

Xxxxxxx US Discovery Offshore Fund III, L.P. $55,787.42 12/20/02 10% Accrued and
1221 Avenue of the Americas, 40th Floor, Added to principal
Xxx Xxxx, Xxx Xxxx 00000

Xxxxxxxxx X. Xxxxxx, Xx. $101,390.17 12/20/02 10% - interest paid
One Angelus Drive in cash on interest
Xxxxxxxxxxx, Xxx Xxxx 00000 payment dates

Xxxxxx X. Xxxxxx $50,715.84 12/20/02 10% Accrued and
00 Xxxxxxxx Xxxxxx Added to principal
Xxxxxxxxxxx, Xxx Xxxx 00000

Copies of the form Convertible Note and Exchange Note are attached hereto.

B. Other Debt:

i. Premium Finance Agreement with A.I. Credit Corp. in the amount of
$308,664.30 representing financed Insurance premiums on liability,
workers compensation, business auto, property and umbrella policies,
covering period 4/27/03 through 4/27/04, requiring 8 equal payments
through 12/17/03.

ii. Premium Finance Agreement with First Insurance Funding in the amount
of $68,592 representing financed Insurance premiums on Pollution and
Environmental impairment policies, covering period 1/20/03 through
1/20/03, requiring 9 equal payments through 10/20/03.

iii Premium Finance Agreement with A.I. Credit Corp. in the amount of
$77,000representing financed Insurance premiums on Directors and
Officers liability policy, covering period 11/1/02 through 11/1/03,
requiring 9 equal payments through 8/1/03.

iv. Premium Finance Agreement with Premium Financing Specialists in the
amount of $26,000, expected to be renewed on or about June 1, 2003
for financing of premiums on A/R Credit Indemnity Policy. 2002-2003
policy paid in full, coming up for renewal and will be refinanced.

2. Obligations of Borrower, Xxxxxx Technologies Company

A. Unsecured Obligations

i. $62,500.00 unsecured note to Busey Bank made pursuant to lease
agreement for Champaign, Illinois facility (see Schedule 5.8), dated
May 15, 2003, based upon 5 year amortization.

ii. A total of $575,000 unsecured notes to Xxxxxxx U.S. Discovery Fund
III, L.P. and Xxxxxxx U.S. Discovery Offshore Fund III, L.P., 1221
Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
("Xxxxxxx Funds"), dated the date of this Revolving Loan Agreement.

B. Additional Secured Debt/Equipment financing:

Expiration 12/31/2002 12/31/2003 12/31/2004 Total
25020 Loans-Recovery Vans
--------------------------------
1999 Econoline - Ford Credit
Houston 0000 Xxx-00 $ 7,214.00 $ 6,633.00 $ 581.06 $ 7,214.06
1999 Chev Cube Van - GMAC
Hillburn 0280 Feb-04 $ 9,071.00 $ 7,712.00 $ 1,359.65 $ 9,071.65
1999 Frht Med Con - GMAC
Houston 0813 Feb-04 $ 14,310.00 $ 12,165.40 $ 2,144.32 $ 14,309.72
1999 Chev Cube Van - GMAC
Chicago 9744 Mar-04 $ 8,411.00 $ 6,527.00 $ 1,884.00 $ 8,411.00
1999 Chev Cube Van - GMAC
Charlotte 0665 Mar-04 $ 8,411.00 $ 6,527.00 $ 1,884.00 $ 8,411.00
1999 Frht Med Con - GMAC
Hillburn 3176 Mar-04 $ 15,271.00 $ 12,067.35 $ 3,203.83 $ 15,271.18
1999 Frht FL 70 - GMAC
Seattle 3177 Apr-04 $ 16,225.00 $ 11,970.09 $ 4,254.80 $ 16,224.89
1999 Frht FL 70 - GMAC
Chicago 3178 Apr-04 $ 16,225.00 $ 11,970.09 $ 4,254.80 $ 16,224.89
1999 Ford Econoline - Ford Credit
Seattle 5434 May-04 $ 9,148.00 $ 6,757.45 $ 2,390.83 $ 9,148.28
0000 Xxxx XX 70 - Intek Assoc
Baltimore 3175 Apr-04 $ 17,706.00 $ 13,067.01 $ 4,639.34 $ 17,706.35
Ford Econoline
Baltimore 2761 Jun-04 $ 10,039.00 $ 6,541.19 $ 3,497.71 $ 10,038.90
Ford Econoline
Baton Rouge 9771 Jun-04 $ 10,039.00 $ 6,541.19 $ 3,497.71 $ 10,038.90
Ford Econoline
Detroit 5427 Jun-04 $ 11,192.00 $ 7,292.70 $ 3,899.17 $ 11,191.87
Ford Econoline
Long Island 9772 Jun-04 $ 11,192.00 $ 7,292.70 $ 3,899.17 $ 11,191.87
Ford Econoline
Boston 5423 Jun-04 $ 11,192.00 $ 7,292.70 $ 3,899.17 $ 11,191.87
Frht Fl 70 - Intek Assoc
Detroit 6207 Jul-04 $ 20,783.00 $ 12,759.90 $ 8,023.55 $ 20,783.45
Frht Fl 70 - Intek Assoc
Boston 6206 Jul-04 $ 20,783.00 $ 12,759.90 $ 8,023.55 $ 20,783.45
Frht Fl 70 - Intek Assoc. 6208 Sep-04 $ 23,492.00 $ 12,456.00 $ 11,037.12 $ 23,493.12
Frht Fl 70 - Intek Assoc. 6209 Oct-04 $ 24,492.00 $ 12,297.00 $ 12,194.00 $ 24,491.00
Frht Fl 70 - Intek Assoc. 6210 Oct-04 $ 24,492.00 $ 12,297.00 $ 12,194.00 $ 24,491.00
--------------------------------------- -----------
Total - Loans - Recovery Vans $289,688.00 $192,926.67 $ 96,761.78 $289,688.45
--------------------------------------- -----------

Schedule 5.21

Environmental Matters

(a) The Borrower is a refrigerant services company providing innovative
solutions to recurring problems within the refrigeration industry. The
Borrower's products and services are primarily used in commercial air
conditioning, industrial processing and refrigeration systems, including (i)
refrigerant sales, (ii) RefrigerantSide(R) Services performed at a customer's
site, consisting of system decontamination to remove moisture, oils and other
contaminants and (iii) reclamation of refrigerants. The Company's products and
services are centered around refrigerants of all types, including
Chlorofluorocarbons (CFC's), Hydrochlorofluorocarbons (HCFC's),
Hyrofluorocarbons (HFC's), and Anhydrous Ammonia. Most refrigerants handled,
processed or sold by the Borrower are classified as hazardous materials and some
are classified as hazardous substances.

Additionally, the Borrower's facilities located at Champaign,
Illinois and Rantoul, Illinois, and Punta Gorda, Florida, are classified as
small waste generators and generate and store small amounts of hazardous waste
representing spent laboratory chemicals used in the Borrower's refrigerant
testing laboratories.

(c) (i) On April 1, 1999, the Borrower reported a release at its Hillburn,
New York facility of approximately 7,800 lbs. of R-11, as a result of a failed
hose connection to one of the Borrower's outdoor storage tanks allowing liquid
R-11 to discharge from the tank into the concrete secondary containment area in
which the subject tank was located. The R-11 migrated to ground water and
impacted four xxxxx operated by United Water New York used for supply of
drinking water to Rockland County.

(ii) In January 1999, the Borrower had a vapor release at its Baton
Rouge, Louisiana facility of a quantity of ammonia.

(iii) Normal operation of the Borrower's equipment results in de
minimis releases of refrigerants. EPA regulations permit a loss of up to 1.5% of
refrigerant processed during reclamation procedures.

(d) The Borrower has above ground bulk storage tanks used for the storage
of refrigerant at the following facilities: Rantoul, Illinois; Champaign,
Illinois, Xxxxxxxxx, Xxxxx Xxxxxxxx; Xxxxx Xxxxx, Xxxxxxx. Additionally, the
Company stores refrigerants at each of its facilities in cylinders and tanks
ranging in size from 30 lbs to 10,000 lbs.

(f) All of the Borrower's facilities, except for the Pearl River, New York
and Fremont, New Hampshire facilities, have various refrigerants at the
facilities, including Chlorofluorocarbons (CFC's), Hydrochlorofluorocarbons
(HCFC's), Hyrofluorocarbons (HFC's), and Anhydrous Ammonia. Most refrigerants
handled, processed or sold by the Borrower are classified as hazardous materials
and some are classified as hazardous substances.

(h) See schedule 5.13 above.

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Table of Contents

i) REVOLVING LOAN AGREEMENT

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