LOAN AND SECURITY AGREEMENT

                                                                  EXHIBIT 10(ab)
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                           LOAN AND SECURITY AGREEMENT

THIS LOAN AND SECURITY AGREEMENT (this "Agreement") dated as of the Effective
Date between (i) SILICON VALLEY BANK, a California corporation with its
principal place of business at 3003 Tasman Drive, Santa Clara, California 95054
and with a loan production office located at One Newton Executive Park, Suite
200, 2221 Washington Street, Newton, Massachusetts 02462 ("Bank"), and (ii)
SPIRE CORPORATION, a Massachusetts corporation, SPIRE SOLAR, INC., a
Massachusetts corporation, SPIRE BIOMEDICAL, INC., a Massachusetts corporation,
each with offices located at One Patriots Park, Bedford, Massachusetts 01730,
and SPIRE SEMICONDUCTOR, LLC, a Delaware limited liability company (formerly
known as Bandwidth Semiconductor, LLC), with offices at 25 Sagamore Park Road,
Hudson, NH 03051 (jointly and severally, individually and collectively, the
"Borrower"), provides the terms on which Bank shall lend to Borrower and
Borrower shall repay Bank. The parties agree as follows:

         1         ACCOUNTING AND OTHER TERMS

         Accounting terms not defined in this Agreement shall be construed
following GAAP. Calculations and determinations must be made following GAAP.
Capitalized terms not otherwise defined in this Agreement shall have the
meanings set forth in Section 13. All other terms contained in this Agreement,
unless otherwise indicated, shall have the meaning provided by the Code to the
extent such terms are defined therein.

         2         LOAN AND TERMS OF PAYMENT

         2.1       Promise to Pay. Borrower hereby unconditionally promises to
pay Bank the outstanding principal amount of all Credit Extensions and accrued
and unpaid interest thereon as and when due in accordance with this Agreement.

         2.1.1     Revolving Advances.

                  (a)      Availability. Subject to the terms and conditions of
this Agreement and to deduction of Reserves, Bank shall make Advances not
exceeding the Availability Amount. Amounts borrowed hereunder may be repaid and,
prior to the Revolving Line Maturity Date, reborrowed, subject to the applicable
terms and conditions precedent herein.

                  (b)      Termination; Repayment. The Revolving Line terminates
on the Revolving Line Maturity Date, when the principal amount of all Advances,
the unpaid interest thereon, and all other Obligations relating to the Revolving
Line shall be immediately due and payable.

         2.1.2     Letters of Credit Sublimit.

                  (a)      As part of the Revolving Line, Bank shall issue or
have issued Letters of Credit for Borrower's account. Such aggregate amounts
utilized hereunder shall at all times reduce the amount otherwise available for
Advances under the Revolving Line. The face amount of outstanding Letters of
Credit (including drawn but unreimbursed Letters of Credit and any Letter of
Credit Reserve) may not exceed One Million Five Hundred Thousand Dollars
($1,500,000) inclusive of the Credit Extensions made pursuant to Sections 2.1.3
and 2.1.4. If, on the Revolving Line Maturity Date, there are any outstanding
Letters of Credit, then on such date Borrower shall provide to Bank cash
collateral in an amount equal to 105% of the face amount of all such Letters of
Credit plus all interest, fees, and costs due or to become due in connection
therewith (as estimated by Bank in its good faith business judgment), to secure
all of the Obligations relating to said Letters of Credit. All Letters of Credit
shall be in form and substance acceptable to Bank in its sole discretion and
shall be subject to the terms and conditions of Bank's standard Application and
Letter of Credit Agreement (the "Letter of Credit Application"). Borrower agrees
to execute any further documentation in connection with the Letters of Credit as
Bank may reasonably request. Borrower further agrees to be bound by the
regulations and interpretations of the issuer of any Letters of Credit
guarantied by Bank and opened for Borrower's account or by Bank's
interpretations of any Letter of Credit issued by Bank for Borrower's account,
and Borrower understands and agrees that Bank shall not be liable for any error,
negligence, or mistake, whether of omission or commission, in following
Borrower's instructions or those contained in the Letters of Credit or any
modifications, amendments, or supplements thereto.
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                  (b)      The obligation of Borrower to immediately reimburse
Bank for drawings made under Letters of Credit shall be absolute, unconditional,
and irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement, such Letters of Credit, and the Letter of Credit Application.

                  (c)      Borrower may request that Bank issue a Letter of
Credit payable in a Foreign Currency. If a demand for payment is made under any
such Letter of Credit, Bank shall treat such demand as an Advance to Borrower of
the equivalent of the amount thereof (plus fees and charges in connection
therewith such as wire, cable, SWIFT or similar charges) in Dollars at the
then-prevailing rate of exchange in San Francisco, California, for sales of the
Foreign Currency for transfer to the country issuing such Foreign Currency.

                  (d)      To guard against fluctuations in currency exchange
rates, upon the issuance of any Letter of Credit payable in a Foreign Currency,
Bank shall create a reserve (the "Letter of Credit Reserve") under the Revolving
Line in an amount equal to ten percent (10%) of the face amount of such Letter
of Credit. The amount of the Letter of Credit Reserve may be adjusted by Bank
from time to time to account for fluctuations in the exchange rate. The
availability of funds under the Revolving Line shall be reduced by the amount of
such Letter of Credit Reserve for as long as such Letter of Credit remains
outstanding.

         2.1.3     Foreign Exchange Sublimit. As part of the Revolving Line,
Borrower may enter into foreign exchange contracts with Bank under which
Borrower commits to purchase from or sell to Bank a specific amount of Foreign
Currency (each, a "FX Forward Contract") on a specified date (the "Settlement
Date"). FX Forward Contracts shall have a Settlement Date of at least one (1) FX
Business Day after the contract date and shall be subject to a reserve of ten
percent (10%) of each outstanding FX Forward Contract in a maximum aggregate
amount equal to One Hundred Fifty Thousand Dollars ($150,000) (the "FX
Reserve"). The aggregate amount of FX Forward Contracts at any one time plus
Credit Extensions made pursuant to Sections 2.1.2 and 2.1.4 may not exceed ten
(10) times the amount of the FX Reserve. Any amounts needed to fully reimburse
Bank will be treated as Advances under the Revolving Line and will accrue
interest at the interest rate applicable to Advances.

         2.1.4     Cash Management Services Sublimit. Borrower may use up to One
Million Five Hundred Thousand Dollars ($1,500,000), inclusive of the Credit
Extensions made pursuant to Sections 2.1.2 and 2.1.3, for Bank's cash management
services which may include merchant services, direct deposit of payroll,
business credit card, and check cashing services identified in Bank's various
cash management services agreements (collectively, the "Cash Management
Services"). Any amounts Bank pays on behalf of Borrower for any Cash Management
Services will be treated as Advances under the Revolving Line and will accrue
interest at the interest rate applicable to Advances.

         2.2       Overadvances. If, at any time the sum of (a) the outstanding
amount of any Advances (including any amounts used for Cash Management Services)
plus (b) the face amount of any outstanding Letters of Credit (including drawn
but unreimbursed Letters of Credit and any Letter of Credit Reserve, plus (c)
the FX Reserve (such sum being an "Overadvance"), exceeds the lesser of either
the Revolving Line or the Borrowing Base, Borrower shall immediately pay to Bank
in cash such Overadvance. Without limiting Borrower's obligation to repay Bank
any amount of the Overadvance, Borrower agrees to pay Bank interest on the
outstanding amount of any Overadvance, on demand, at the Default Rate.

         2.3       Payment of Interest on the Credit Extensions.

                  (a)      Interest Rate; Advances. Subject to Section 2.3(b),
the principal amount outstanding under the Revolving Line shall accrue interest
at a per annum rate equal to the Prime Rate plus one percent (1.00%).

                  (b)      Default Rate. Immediately upon the occurrence and
during the continuance of an Event of Default, Obligations shall bear interest
at a rate per annum which is five percentage points (5.00%) above the rate that
is otherwise applicable thereto (the "Default Rate"). Payment or acceptance of
the increased interest rate provided in this Section 2.3(b) is not a permitted
alternative to timely payment and shall not constitute a waiver of any Event of
Default or otherwise prejudice or limit any rights or remedies of Bank.

                  (c)      Adjustment to Interest Rate. Changes to the interest
rate of any Credit Extension based on changes to the Prime Rate shall be
effective on the effective date of any change to the Prime Rate and to the
extent of any such change.

                  (d)      360-Day Year. Interest shall be computed on the basis
of a 360-day year for the actual number of days elapsed.

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                  (e)      Debit of Accounts. Bank may debit any of Borrower's
deposit accounts, including the Designated Deposit Account, for principal and
interest payments or any other amounts Borrower owes Bank when due. These debits
shall not constitute a set-off.

                   (f)      Payment; Interest Computation; Float Charge. Interest
is payable monthly on the last calendar day of each month. In computing interest
on the Obligations, all Payments received after 12:00 p.m. Pacific time on any
day shall be deemed received on the next Business Day. In addition, so long as
any principal or interest with respect to any Credit Extension remains
outstanding, Bank shall be entitled to charge Borrower a "float" charge in an
amount equal to three (3) Business Days interest, at the interest rate
applicable to the Credit Extensions on all Payments received by Bank. The float
charge for each month shall be payable on the last day of the month. Bank shall
not, however, be required to credit Borrower's account for the amount of any
item of payment which is unsatisfactory to Bank in its good faith business
judgment, and Bank may charge Borrower's Designated Deposit Account for the
amount of any item of payment which is returned to Bank unpaid.

         2.4       Fees. Borrower shall pay to Bank:

                  (a)      Commitment Fee. A fully earned, non-refundable
commitment fee of Fifty Thousand Dollars ($50,000), payable on the Effective
Date;

                  (b)      Letter of Credit Fee. Bank's customary fees and
expenses for the issuance or renewal of Letters of Credit, upon the issuance,
each anniversary of the issuance, and the renewal of such Letter of Credit by
Bank;

                  (c)      Termination Fee. Subject to the terms of Section 12.1,
a termination fee;

                   (d)      Unused Revolving Line Facility Fee. A fee (the "Unused
Revolving Line Facility Fee"), payable monthly, in arrears, on a calendar year
basis, in an amount equal to three-quarters of one percent (0.75%) per annum of
the average unused portion of the Revolving Line, as determined by Bank. The
unused portion of the Revolving Line, for the purposes of this calculation,
shall include amounts reserved under the Cash Management Services Sublimit for
products provided and under the Foreign Exchange Sublimit for FX Forward
Contracts. Borrower shall not be entitled to any credit, rebate or repayment of
any Unused Revolving Line Facility Fee previously earned by Bank pursuant to
this Section notwithstanding any termination of the Agreement, or suspension or
termination of Bank's obligation to make loans and advances hereunder;

                  (e)      Collateral Monitoring Fee. For any month or any
portion thereof in which a Liquidity Event has occurred or is continuing, a
collateral monitoring fee, payable monthly, in arrears, on the last day of each
month, in the amount of Seven Hundred Fifty Dollars ($750); and

                  (f)      Bank Expenses. All Bank Expenses (including reasonable
attorneys' fees and expenses, plus expenses, for documentation and negotiation
of this Agreement) incurred through and after the Effective Date, when due.

         3         CONDITIONS OF LOANS

         3.1       Conditions Precedent to Initial Credit Extension. Bank's
obligation to make the initial Credit Extension is subject to the condition
precedent that Borrower shall consent to or have delivered, in form and
substance satisfactory to Bank, such documents, and completion of such other
matters, as Bank may reasonably deem necessary or appropriate, including,
without limitation:

                  (a)      duly executed original signatures to the Loan
Documents to which it is a party;

                  (b)      its Operating Documents and a good standing
certificate of each Borrower certified by the Secretary of State of the
Commonwealth of Massachusetts and the State of Delaware, as applicable, as of a
date no earlier than thirty (30) days prior to the Effective Date;

                  (c)      duly executed original signatures to the completed
Borrowing Resolutions for Borrower;

                  (d)      certified copies, dated as of a recent date, of
financing statement searches, as Bank shall request, accompanied by written
evidence (including any UCC termination statements) that the Liens indicated in

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any such financing statements either constitute Permitted Liens or have been or,
in connection with the initial Credit Extension, will be terminated or released;

                  (e)      the Perfection Certificates executed by Borrower;

                  (f)      a landlord's consent executed by each landlord of the
Borrower in favor of Bank;

                  (g)      a legal opinion of Borrower's counsel dated as of the
Effective Date together with the duly executed original signatures thereto;

                  (h)      evidence satisfactory to Bank that the insurance
policies required by Section 6.7 hereof are in full force and effect, together
with appropriate evidence showing loss payable and/or additional insured clauses
or endorsements in favor of Bank; and

                  (i)      payment of the fees and Bank Expenses then due as
specified in Section 2.4 hereof.

         3.2       Conditions Precedent to all Credit Extensions. Bank's
obligations to make each Credit Extension, including the initial Credit
Extension, is subject to the following:

                  (a)      except as otherwise provided in Section 3.4, timely
receipt of an executed Transaction Report;

                  (b)      the representations and warranties in Section 5 shall
be true in all material respects on the date of the Transaction Report and on
the Funding Date of each Credit Extension; provided, however, that such
materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text
thereof; and provided, further that those representations and warranties
expressly referring to a specific date shall be true, accurate and complete in
all material respects as of such date, and no Default or Event of Default shall
have occurred and be continuing or result from the Credit Extension. Each Credit
Extension is Borrower's representation and warranty on that date that the
representations and warranties in Section 5 remain true in all material
respects; provided, however, that such materiality qualifier shall not be
applicable to any representations and warranties that already are qualified or
modified by materiality in the text thereof; and provided, further that those
representations and warranties expressly referring to a specific date shall be
true, accurate and complete in all material respects as of such date; and

                  (c)      in Bank's sole discretion, there has not been any
material impairment in the general affairs, management, results of operations,
financial condition or the prospect of repayment of the Obligations, or there
has not been any material adverse deviation by Borrower from the most recent
business plan of Borrower presented to and accepted by Bank.

         3.3       Covenant to Deliver.

         Borrower agrees to deliver to Bank each item required to be delivered
to Bank under this Agreement as a condition to any Credit Extension. Borrower
expressly agrees that a Credit Extension made prior to the receipt by Bank of
any such item shall not constitute a waiver by Bank of Borrower's obligation to
deliver such item, and any such Credit Extension in the absence of a required
item shall be made in Bank's sole discretion.

          3.4       Procedures for Borrowing. Subject to the prior satisfaction of
all other applicable conditions to the making of an Advance set forth in this
Agreement, to obtain an Advance (other than Advances under Sections 2.1.2 or
2.1.4), Borrower shall notify Bank (which notice shall be irrevocable) by
electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the
Funding Date of the Advance. Together with such notification, Borrower must
promptly deliver to Bank by electronic mail or facsimile a completed Transaction
Report executed by a Responsible Officer or his or her designee. Bank shall
credit Advances to the Designated Deposit Account. Bank may make Advances under
this Agreement based on instructions from a Responsible Officer or his or her
designee or without instructions if the Advances are necessary to meet
Obligations which have become due. Bank may rely on any telephone notice given
by a person whom Bank believes is a Responsible Officer or designee.

         4         CREATION OF SECURITY INTEREST

         4.1       Grant of Security Interest. Borrower hereby grants Bank, to
secure the payment and performance in full of all of the Obligations, a
continuing security interest in, and pledges to Bank, the Collateral, wherever

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located, whether now owned or hereafter acquired or arising, and all proceeds
and products thereof. Borrower represents, warrants, and covenants that the
security interest granted herein is and shall at all times continue to be a
first priority perfected security interest in the Collateral (subject only to
Permitted Liens that may have superior priority to Bank's Lien under this
Agreement). If Borrower shall acquire a commercial tort claim, Borrower shall
promptly notify Bank in a writing signed by Borrower of the general details
thereof and grant to Bank in such writing a security interest therein and in the
proceeds thereof, all upon the terms of this Agreement, with such writing to be
in form and substance reasonably satisfactory to Bank.

         If this Agreement is terminated, Bank's Lien in the Collateral shall
continue until the Obligations (other than inchoate indemnity obligations) are
repaid in full in cash. Upon payment in full in cash of the Obligations and at
such time as Bank's obligation to make Credit Extensions has terminated, Bank
shall, at Borrower's sole cost and expense, release its Liens in the Collateral
and all rights therein shall revert to Borrower.

         4.2       Authorization to File Financing Statements. Borrower hereby
authorizes Bank to file financing statements, without notice to Borrower, with
all appropriate jurisdictions to perfect or protect Bank's interest or rights
hereunder, including a notice that any disposition of the Collateral, by either
Borrower or any other Person, shall be deemed to violate the rights of Bank
under the Code. Such financing statements may indicate the Collateral as "all
assets of the Debtor" or words of similar effect, or as being of an equal or
lesser scope, or with greater detail, all in Bank's discretion.

         5         REPRESENTATIONS AND WARRANTIES

                  Each Borrower represents and warrants as follows:

         5.1       Due Organization, Authorization; Power and Authority. Each
Borrower is duly existing and in good standing as a Registered Organization in
its jurisdiction of formation and is qualified and licensed to do business and
is in good standing in any jurisdiction in which the conduct of its business or
its ownership of property requires that it be qualified except where the failure
to do so could not reasonably be expected to have a material adverse effect on
Borrower's business. In connection with this Agreement, each Borrower has
delivered to Bank a completed certificate signed by such Borrower, entitled
"Perfection Certificate". Each Borrower represents and warrants to Bank that (a)
such Borrower's exact legal name is that indicated on such Perfection
Certificate and on the signature page hereof; (b) such Borrower is an
organization of the type and is organized in the jurisdiction set forth in its
respective Perfection Certificate; (c) each Perfection Certificate accurately
sets forth such Borrower's organizational identification number or accurately
states that such Borrower has none; (d) each Perfection Certificate accurately
sets forth such Borrower's place of business, or, if more than one, its chief
executive office as well as such Borrower's mailing address (if different than
its chief executive office); (e) each Borrower (and each of its respective
predecessors) has not, in the past five (5) years, changed its jurisdiction of
formation, organizational structure or type, or any organizational number
assigned by its jurisdiction; and (f) all other information set forth on the
Perfection Certificate pertaining to such Borrower and each of its Subsidiaries
is accurate and complete (it being understood and agreed that each Borrower may
from time to time update certain information in the Perfection Certificate after
the Effective Date to the extent permitted by one or more specific provisions in
this Agreement). If any Borrower is not now a Registered Organization but later
becomes one, such Borrower shall promptly notify Bank of such occurrence and
provide Bank with such Borrower's organizational identification number.

         The execution, delivery and performance by Borrower of the Loan
Documents to which it is a party have been duly authorized, and do not (i)
conflict with any of Borrower's organizational documents, (ii) contravene,
conflict with, constitute a default under or violate any material Requirement of
Law, (iii) contravene, conflict or violate any applicable order, writ, judgment,
injunction, decree, determination or award of any Governmental Authority by
which Borrower or any of its Subsidiaries or any of their property or assets may
be bound or affected, (iv) require any action by, filing, registration, or
qualification with, or Governmental Approval from, any Governmental Authority
(except such Governmental Approvals which have already been obtained and are in
full force and effect or (v) constitute an event of default under any material
agreement by which Borrower is bound. Other than defaults of the Borrower under
the Equipment Line that (X) have been previously disclosed to Bank and (Y) have
been waived by Bank, Borrower is not in default under any agreement to which it
is a party or by which it is bound in which the default could reasonably be
expected to have a material adverse effect on Borrower's business.

         5.2       Collateral. Borrower has good title to, has rights in, and the
power to transfer each item of the Collateral upon which it purports to grant a
Lien hereunder, free and clear of any and all Liens except Permitted Liens.
Borrower has no deposit accounts other than the deposit accounts with Bank, the
deposit accounts, if any, described in the Perfection Certificate delivered to
Bank in connection herewith, or of which Borrower has given

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Bank notice and taken such actions as are necessary to give Bank a perfected
security interest therein. The Accounts are bona fide, existing obligations of
the Account Debtors.

                  The Collateral is not in the possession of any third party
bailee (such as a warehouse) except as otherwise provided in the Perfection
Certificate. None of the components of the Collateral shall be maintained at
locations other than as provided in the Perfection Certificate or as permitted
pursuant to Section 7.2. In the event that Borrower, after the date hereof,
intends to store or otherwise deliver any portion of the Collateral to a bailee,
then Borrower will first receive the written consent of Bank and such bailee
must execute and deliver a bailee agreement in form and substance satisfactory
to Bank in its sole discretion.

         All Inventory is in all material respects of good and marketable
quality, free from material defects.

         Borrower is the sole owner of its intellectual property, except for
non-exclusive licenses granted to its customers in the ordinary course of
business. Each patent is valid and enforceable and no part of the intellectual
property has been judged invalid or unenforceable, in whole or in part, and to
the best of Borrower's knowledge, no claim has been made that any part of the
intellectual property violates the rights of any third party.

         Borrower is not a party to, nor is bound by, any material license or
other agreement with respect to which Borrower is the licensee (a) that
prohibits or otherwise restricts Borrower from granting a security interest in
Borrower's interest in such license or agreement or any other property, or (b)
for which a default under or termination of could interfere with the Bank's
right to sell any Collateral. Borrower shall provide written notice to Bank
within ten (10) days of entering or becoming bound by any such license or
agreement which is reasonably likely to have a material impact on Borrower's
business or financial condition (other than over-the-counter software that is
commercially available to the public). Borrower shall take such steps as Bank
requests to obtain the consent of, or waiver by, any person whose consent or
waiver is necessary for (x) all such licenses or agreements to be deemed
"Collateral" and for Bank to have a security interest in it that might otherwise
be restricted or prohibited by law or by the terms of any such license or
agreement, whether now existing or entered into in the future, and (y) Bank to
have the ability in the event of a liquidation of any Collateral to dispose of
such Collateral in accordance with Bank's rights and remedies under this
Agreement and the other Loan Documents.

         5.3       Accounts Receivable; Inventory.

                  (a)      For each Account with respect to which Advances are
requested, on the date each Advance is requested and made, such Account shall be
an Eligible Account.

                  (b)      All statements made and all unpaid balances appearing
in all invoices, instruments and other documents evidencing the Eligible
Accounts are and shall be true and correct and all such invoices, instruments
and other documents, and all of Borrower's Books are genuine and in all respects
what they purport to be. Whether or not an Event of Default has occurred and is
continuing, Bank may notify any Account Debtor owing Borrower money of Bank's
security interest in such funds and verify the amount of such Eligible Account.
All sales and other transactions underlying or giving rise to each Eligible
Account shall comply in all material respects with all applicable laws and
governmental rules and regulations. Borrower has no knowledge of any actual or
imminent Insolvency Proceeding of any Account Debtor whose accounts are Eligible
Accounts in any Transaction Report. To the best of Borrower's knowledge, all
signatures and endorsements on all documents, instruments, and agreements
relating to all Eligible Accounts are genuine, and all such documents,
instruments and agreements are legally enforceable in accordance with their
terms.

                  (c)      For any item of Inventory consisting of Eligible
Inventory in any Transaction Report, such Inventory (i) consists of finished
goods, in good, new, and salable condition, which is not perishable, returned,
consigned, obsolete, not sellable, damaged, or defective, and is not comprised
of demonstrative or custom inventory, works in progress, packaging or shipping
materials, or supplies; (ii) meets all applicable governmental standards; (iii)
has been manufactured in compliance with the Fair Labor Standards Act; (iv) is
not subject to any Liens, except the first priority Liens granted or in favor of
Bank under this Agreement or any of the other Loan Documents; and (v) is located
at the locations identified by Borrower in the Perfection Certificate where it
maintains Inventory (or any location permitted under Section 7.2).

         5.4       Litigation. Except as set forth on Schedule 5.4 attached
hereto, there are no actions or proceedings pending or, to the knowledge of the
Responsible Officers, threatened in writing by or against Borrower or any of its
Subsidiaries involving more than One Hundred Thousand Dollars ($100,000).

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         5.5       No Material Deviation in Financial Statements. All
consolidated financial statements for Borrower and any of its Subsidiaries
delivered to Bank fairly present in all material respects Borrower's
consolidated financial condition and Borrower's consolidated results of
operations. There has not been any material deterioration in Borrower's
consolidated financial condition since the date of the most recent financial
statements submitted to Bank.

         5.6       Solvency. The fair salable value of Borrower's assets
(including goodwill minus disposition costs) exceeds the fair value of its
liabilities; Borrower is not left with unreasonably small capital after the
transactions in this Agreement; and Borrower is able to pay its debts (including
trade debts) as they mature.

         5.7       Regulatory Compliance. Borrower is not an "investment company"
or a company "controlled" by an "investment company" under the Investment
Company Act of 1940, as amended. Borrower is not engaged as one of its important
activities in extending credit for margin stock (under Regulations X, T and U of
the Federal Reserve Board of Governors). Borrower has complied in all material
respects with the Federal Fair Labor Standards Act. Neither Borrower nor any of
its Subsidiaries is a "holding company" or an "affiliate" of a "holding company"
or a "subsidiary company" of a "holding company" as each term is defined and
used in the Public Utility Holding Company Act of 2005. Borrower has not
violated any laws, ordinances or rules, the violation of which could reasonably
be expected to have a material adverse effect on its business. None of
Borrower's or any of its Subsidiaries' properties or assets has been used by
Borrower or any Subsidiary or, to the best of Borrower's knowledge, by previous
Persons, in disposing, producing, storing, treating, or transporting any
hazardous substance other than legally. Borrower and each of its Subsidiaries
have obtained all consents, approvals and authorizations of, made all
declarations or filings with, and given all notices to, all Government
Authorities that are necessary to continue their respective businesses as
currently conducted.

         5.8       Subsidiaries; Investments. Borrower does not own any stock,
partnership interest or other equity securities except for Permitted
Investments.

         5.9       Tax Returns and Payments; Pension Contributions. Borrower has
timely filed all required tax returns and reports, and Borrower has timely paid
all foreign, federal, state and local taxes, assessments, deposits and
contributions owed by Borrower. Borrower may defer payment of any contested
taxes, provided that Borrower (a) in good faith contests its obligation to pay
the taxes by appropriate proceedings promptly and diligently instituted and
conducted, (b) notifies Bank in writing of the commencement of, and any material
development in, the proceedings, (c) posts bonds or takes any other steps
required to prevent the governmental authority levying such contested taxes from
obtaining a Lien upon any of the Collateral that is other than a "Permitted
Lien". Borrower is unaware of any claims or adjustments proposed for any of
Borrower's prior tax years which could result in additional taxes becoming due
and payable by Borrower. Borrower has paid all amounts necessary to fund all
present pension, profit sharing and deferred compensation plans in accordance
with their terms, and Borrower has not withdrawn from participation in, and has
not permitted partial or complete termination of, or permitted the occurrence of
any other event with respect to, any such plan which could reasonably be
expected to result in any liability of Borrower, including any liability to the
Pension Benefit Guaranty Corporation or its successors or any other governmental
agency.

         5.10       Use of Proceeds. Borrower shall use the proceeds of the Credit
Extensions solely as working capital and to fund its general business
requirements and not for personal, family, household or agricultural purposes.

         5.11      Full Disclosure. No written representation, warranty or other
statement of Borrower in any certificate or written statement given to Bank, as
of the date such representation, warranty, or other statement was made, taken
together with all such written certificates and written statements given to
Bank, contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained in the certificates or
statements not misleading (it being recognized by Bank that the projections and
forecasts provided by Borrower in good faith and based upon reasonable
assumptions are not viewed as facts and that actual results during the period or
periods covered by such projections and forecasts may differ from the projected
or forecasted results).

          6         AFFIRMATIVE COVENANTS

         Borrower shall do all of the following:

         6.1       Government Compliance.

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                  (a)      Maintain its and all its Subsidiaries' legal existence
and good standing in their respective jurisdictions of formation and maintain
qualification in each jurisdiction in which the failure to so qualify would
reasonably be expected to have a material adverse effect on Borrower's business
or operations. Borrower shall comply, and have each Subsidiary comply, with all
laws, ordinances and regulations to which it is subject, noncompliance with
which could have a material adverse effect on Borrower's business.

                  (b)      Obtain all of the Governmental Approvals necessary for
the performance by Borrower of its obligations under the Loan Documents to which
it is a party and the grant of a security interest to Bank in all of its
property. Borrower shall promptly provide copies of any such obtained
Governmental Approvals to Bank.

         6.2       Financial Statements, Reports, Certificates.

                  (a)      Borrower shall provide Bank with the following:

                  (i) monthly within fifteen (15) days after the end of such
period (or, during a Liquidity Event, weekly on the last Business Day of such
week), and with each request for a Credit Extension, a Transaction Report (and
any schedules related thereto);

                  (ii) within fifteen (15) days after the end of each month, (A)
monthly accounts receivable agings, aged by invoice date, (B) monthly accounts
payable agings, aged by invoice date, backlog reports and outstanding or held
check registers, if any, (C) monthly reconciliations of accounts receivable
agings (aged by invoice date), and the general ledger, (D) monthly inventory
reports for Inventory, computed on a first-in, first-out basis, valued at the
lower of cost or market (in accordance with GAAP), or such other Inventory
reports as are requested by Bank in its good faith business judgment, and (E)
outstanding purchase orders;

                  (iii) as soon as available, and in any event within thirty
(30) days after the end of each month, monthly unaudited financial statements;

                  (iv) within thirty (30) days after the end of each month a
monthly Compliance Certificate signed by a Responsible Officer, certifying that
as of the end of such month, Borrower was in full compliance with all of the
terms and conditions of this Agreement, and setting forth calculations showing
compliance with the financial covenants set forth in this Agreement and such
other information as Bank shall reasonably request, including, without
limitation, a statement that at the end of such month there were no held checks;

                   (v) within thirty (30) days prior to the end of each fiscal
year of Borrower, (A) annual operating budgets (including income statements,
balance sheets and cash flow statements, by month) for the upcoming fiscal year
of Borrower, and (B) annual financial projections for the following fiscal year
(on a monthly basis) as approved by Borrower's board of directors, together with
any related business forecasts used in the preparation of such annual financial
projections; and

                  (vi) as soon as available, and in any event within one hundred
fifty (150) days following the end of Borrower's fiscal year, annual financial
statements audited by independent certified public accountants acceptable to
Bank.

                  Notwithstanding the foregoing, during a Liquidity Event,
Borrower shall be required to provide Bank with the Transaction Report required
pursuant to clause (a)(i) above on a weekly basis, as of the last Business Day
of such month.

                  (b)      In the event that Borrower becomes subject to the
reporting requirements under the Securities Exchange Act of 1934, as amended,
within five (5) days after filing, all reports on Form 10-K, 10-Q and 8-K filed
with the Securities and Exchange Commission or a link thereto on Borrower's or
another website on the Internet.

         6.3       Accounts Receivable.

                  (a)      Schedules and Documents Relating to Accounts. Borrower
shall deliver to Bank Transaction Reports and schedules of collections, as
provided in Section 6.2, on Bank's standard forms; provided, however, that
Borrower's failure to execute and deliver the same shall not affect or limit
Bank's Lien and other rights in all of Borrower's Accounts, nor shall Bank's
failure to advance or lend against a specific Account affect or limit Bank's
Lien and other rights therein. If requested by Bank, Borrower shall furnish Bank
with copies (or, at Bank's request, originals) of all contracts, orders,
invoices, and other similar documents, and all shipping instructions, delivery
receipts, bills of lading, and other evidence of delivery, for any goods the
sale or disposition of which gave rise to such Accounts. In addition, Borrower
shall deliver to Bank, on its request, the originals of all

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instruments, chattel paper, security agreements, guarantees and other documents
and property evidencing or securing any Accounts, in the same form as received,
with all necessary indorsements, and copies of all credit memos.

                  (b)      Disputes. Borrower shall promptly notify Bank of all
disputes or claims relating to Accounts. Borrower may forgive (completely or
partially), compromise, or settle any Account for less than payment in full, or
agree to do any of the foregoing so long as (i) Borrower does so in good faith,
in a commercially reasonable manner, in the ordinary course of business, in
arm's-length transactions, and reports the same to Bank in the regular reports
provided to Bank; (ii) no Default or Event of Default has occurred and is
continuing; and (iii) after taking into account all such discounts, settlements
and forgiveness, the total outstanding Advances will not exceed the lesser of
the Revolving Line or the aggregate Borrowing Base.

                   (c)      Collection of Accounts. Borrower shall have the right
to collect all Accounts, unless and until a Default or an Event of Default has
occurred and is continuing. Collections of Accounts shall be deposited by
Borrower into a lockbox account, or such other "blocked account" as Bank may
specify, pursuant to a blocked account agreement in such form as Bank may
specify in its good faith business judgment. Whether or not an Event of Default
has occurred and is continuing, Borrower shall hold all Payments on, and
proceeds of, Accounts in trust for Bank, and Borrower shall immediately deliver
all such payments and proceeds to Bank in their original form, duly endorsed, to
be applied to the Obligations pursuant to the terms of Section 9.4 hereof;
provided, however, on any date in which Liquidity is equal to or greater than
two and one-half (2.5) times the outstanding principal amount of the
Obligations, and provided no Default has occurred, Bank shall transfer such
amounts on such date to Borrower's Designated Deposit Account.

                  (d)      Returns. Provided no Event of Default has occurred and
is continuing, if any Account Debtor returns any Inventory to Borrower, Borrower
shall promptly (i) determine the reason for such return, (ii) issue a credit
memorandum to the Account Debtor in the appropriate amount, and (iii) provide a
copy of such credit memorandum to Bank, upon request from Bank. In the event any
attempted return occurs after the occurrence and during the continuance of any
Event of Default, Borrower shall hold the returned Inventory in trust for Bank,
and immediately notify Bank of the return of the Inventory.

                  (e)      Verification. Bank may, from time to time, verify
directly with the respective Account Debtors the validity, amount and other
matters relating to the Accounts, either in the name of Borrower or Bank or such
other name as Bank may choose.

                  (f)      No Liability. Bank shall not be responsible or liable
for any shortage or discrepancy in, damage to, or loss or destruction of, any
goods, the sale or other disposition of which gives rise to an Account, or for
any error, act, omission, or delay of any kind occurring in the settlement,
failure to settle, collection or failure to collect any Account, or for settling
any Account in good faith for less than the full amount thereof, nor shall Bank
be deemed to be responsible for any of Borrower's obligations under any contract
or agreement giving rise to an Account. Nothing herein shall, however, relieve
Bank from liability for its own gross negligence or willful misconduct.

         6.4       Remittance of Proceeds. Except as otherwise provided in
Section 6.3(c), deliver, in kind, all proceeds arising from the disposition of
any Collateral to Bank in the original form in which received by Borrower not
later than the following Business Day after receipt by Borrower, to be applied
to the Obligations pursuant to the terms of Section 9.4 hereof; provided that,
if no Default or Event of Default has occurred and is continuing, Borrower shall
not be obligated to remit to Bank the proceeds of the sale of worn out or
obsolete Equipment disposed of by Borrower in good faith in an arm's length
transaction for an aggregate purchase price of $25,000 or less (for all such
transactions in any fiscal year). Borrower agrees that it will not commingle
proceeds of Collateral with any of Borrower's other funds or property, but will
hold such proceeds separate and apart from such other funds and property and in
an express trust for Bank. Nothing in this Section limits the restrictions on
disposition of Collateral set forth elsewhere in this Agreement.

         6.5       Taxes; Pensions. Timely file, and require each of its
Subsidiaries to timely file, all required tax returns and reports and timely
pay, and require each of its Subsidiaries to timely file, all foreign, federal,
state and local taxes, assessments, deposits and contributions owed by Borrower
and each of its Subsidiaries, except for deferred payment of any taxes contested
pursuant to the terms of Section 5.9 hereof, and shall deliver to Bank, on
demand, appropriate certificates attesting to such payments, and pay all amounts
necessary to fund all present pension, profit sharing and deferred compensation
plans in accordance with their terms.

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         6.6       Access to Collateral; Books and Records. At reasonable times,
on one (1) Business Day's notice (provided no notice is required if an Event of
Default has occurred and is continuing), Bank, or its agents, shall have the
right, on a semi-annual basis (or more frequently, as Bank shall determine
necessary in its sole discretion) to inspect the Collateral and the right to
audit and copy Borrower's Books. The foregoing inspections and audits shall be
at Borrower's expense, and the charge therefor shall be $750 per person per day
(or such higher amount as shall represent Bank's then-current standard charge
for the same), plus reasonable out-of-pocket expenses. In the event Borrower and
Bank schedule an audit more than ten (10) days in advance, and Borrower cancels
or seeks to reschedules the audit with less than ten (10) days written notice to
Bank, then (without limiting any of Bank's rights or remedies), Borrower shall
pay Bank a fee of $1,000 plus any out-of-pocket expenses incurred by Bank to
compensate Bank for the anticipated costs and expenses of the cancellation or
rescheduling.

         6.7       Insurance. Keep its business and the Collateral insured for
risks and in amounts standard for companies in Borrower's industry and location
and as Bank may reasonably request. Insurance policies shall be in a form, with
companies, and in amounts that are satisfactory to Bank. All property policies
shall have a loss payable endorsement showing Bank as an additional loss payee
and waive subrogation against Bank, and all liability policies shall show, or
have endorsements showing, Bank as an additional insured. All policies (or the
loss payable and additional insured endorsements) shall provide that the insurer
shall endeavor to give Bank at least twenty (20) days notice before canceling,
amending, or declining to renew its policy. At Bank's request, Borrower shall
deliver certified copies of policies and evidence of all premium payments.
Proceeds payable under any property policy shall, at Bank's option, be payable
to Bank on account of the Obligations. Notwithstanding the foregoing, (a) so
long as no Event of Default has occurred and is continuing, Borrower shall have
the option of applying the proceeds of any casualty policy up to Two Hundred
Fifty Thousand Dollars ($250,000) with respect to any loss, but not exceeding
Five Hundred Thousand Dollars ($500,000) in the aggregate for all losses under
all casualty policies in any one year, toward the replacement or repair of
destroyed or damaged property; provided that any such replaced or repaired
property (i) shall be of equal or like value as the replaced or repaired
Collateral and (ii) shall be deemed Collateral in which Bank has been granted a
first priority security interest, and (b) after the occurrence and during the
continuance of an Event of Default, all proceeds payable under such casualty
policy shall, at the option of Bank, be payable to Bank on account of the
Obligations. If Borrower fails to obtain insurance as required under this
Section 6.7 or to pay any amount or furnish any required proof of payment to
third persons and Bank, Bank may make all or part of such payment or obtain such
insurance policies required in this Section 6.7, and take any action under the
policies Bank deems prudent.

         6.8       Operating Accounts.

                  (a)      Subject to the following, maintain all of its and all
of its Subsidiaries' domestic operating and other deposit accounts and
securities accounts with Bank and Bank's Affiliates:

                  (i) Borrower is permitted to maintain Spire Corporation's
account no. 0000 2591 5267 with Bank of America, provided that the balance in
such Deposit Account shall at no time exceed Twenty Five Thousand Dollars
($25,000);

                  (ii) Borrower is permitted to maintain Spire Corporation's
account nos. 113759-490-7 and 1165-123685 and Spire Semiconductor, LLC's account
nos. 330400-908-9 and 330918-730-8 (collectively, the "Citizens' Accounts",
provided that (A) on a weekly basis, on the last Business Day of each week, and
in any event when the aggregate balance in the Citizens' Accounts exceeds One
Hundred Thousand Dollars ($100,000) , transfer such amounts in the Citizens'
Accounts to Bank for deposit into such account as Bank shal