Non-Negotiable Promissory Note

Non-Negotiable Promissory Note







                         NON-NEGOTIABLE PROMISSORY NOTE


THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 NOR UNDER ANY
STATE SECURITIES LAW AND MAY NOT BE PLEDGED, SOLD, ASSIGNED OR TRANSFERRED UNTIL
(i) A  REGISTRATION  STATEMENT  WITH  RESPECT  THERETO  IS  EFFECTIVE  UNDER THE
SECURITIES  ACT OF 1933  AND ANY  APPLICABLE  STATE  SECURITIES  LAW OR (ii) THE
COMPANY  RECEIVES  AN  OPINION  OF  COUNSEL  TO THE  COMPANY  OR  OTHER  COUNSEL
REASONABLY  SATISFACTORY  TO THE  COMPANY  TO THE  EFFECT  THAT SUCH NOTE MAY BE
PLEDGED,  SOLD,  ASSIGNED  OR  TRANSFERRED  WITHOUT  AN  EFFECTIVE  REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933 OR APPLICABLE STATE SECURITIES LAWS.

$1,400,000                                             Lancaster, Pennsylvania
  No. 1                                                November 14, 1995

         FOR VALUE  RECEIVED,  the  undersigned,  LEE N. BLATT,  residing at 471
North Arrowhead Trail, Vero Beach, Florida 32903 (the "Maker"),  promises to pay
to HERLEY INDUSTRIES,  INC., a Delaware  corporation with its principal place of
business at 10 Industry Drive,  Lancaster,  Pennsylvania  17603  ("Payee"),  the
principal amount of ONE MILLION FOUR HUNDRED THOUSAND  ($1,400,000)  DOLLARS, on
or before 12:00 noon on November 14, 1996,  unless renewed by the Company for up
to four additional  one-year  periods at 75% of the average closing price of the
Company's  Common Stock for the ten trading days prior thereto,  without set-off
or counterclaim and without any deduction or withholding,  plus interest thereon
at a rate determined  annually equal to the average rate of interest paid by the
Company for borrowed  monies  computed on a Company fiscal year basis.  Interest
shall be payable at the maturity hereof.  All payments shall be applied first to
pay accrued but unpaid  interest,  and the  remainder to reduce the  outstanding
principal amount hereof. In no event shall the rate of interest hereunder exceed
that  permitted by law and if  fulfillment of the  obligations  hereunder  would
violate the usury limit of applicable  law, the  obligations  hereunder shall be
automatically reduced to the limit of validity.

         This  Note may be  prepaid  in whole or in  part,  without  premium  or
penalty at any time.

         The occurrence of any one of the following  events shall  constitute an
event of default hereunder:

         (a) The Maker shall fail to pay within 10 days after written  notice of
any failure to pay any amount due hereunder.

         (b) The Maker  shall  commence  a  voluntary  case  under  the  federal
bankruptcy laws, shall seek to take advantage of any insolvency laws, shall make
an  assignment  for the benefit of  creditors,  shall  apply for,  consent to or
acquiesce in the appointment of, or taking possession by, a trustee,






receiver,  custodian or similar  official or agent for itself or any substantial
part of its property,  or shall take any action authorizing or seeking to effect
any of the foregoing.

         (c) A trustee,  receiver,  custodian or similar official or agent shall
be appointed for the Maker or any  substantial  part of its property,  or all or
any  substantial  part of the  property  of the  Maker is  condemned,  seized or
otherwise appropriated by any governmental authority.

         (d) The Maker shall have an order or decree for relief in any voluntary
or involuntary case under the federal bankruptcy laws entered against it, or any
involuntary   petition  seeking   reorganization,   liquidation,   readjustment,
arrangement,  composition,  or other  similar  relief as to it under the federal
bankruptcy laws, or any similar law for the relief of debtors,  shall be brought
and shall be consented to or shall remain undismissed.

         In the event that an event of default described in paragraph (c) or (d)
above is cured by the Maker,  such event shall no longer  constitute an event of
default.

         Not in  limitation  of any other right under any other  agreement or at
law or in equity,  if any event of default  hereunder  shall have  occurred  the
holder hereof may, upon notice to the Maker,  declare all obligations under this
Note to be, and thereupon the same shall become,  immediately due and payable by
the Maker without  presentment,  demand,  protest or further notice of any kind,
all of which are hereby expressly waived by the Maker.

         The Maker and all endorsers  hereof hereby waive  presentment,  demand,
protest, notice of protest, notice of dishonor and all other forms of demand and
notice  concerning  this  Note  and  consent  to each  and  every  extension  or
postponement  of the time of payment or other  indulgence  with  respect to this
Note,  and to each and every  substitution,  addition,  exchange  or  release of
collateral and to the addition,  substitution or release of any person primarily
or  secondarily  liable  hereunder.  No delay or  omission by the Payee or other
holder  hereof in  exercising  any right or power  hereunder  shall operate as a
waiver  of such  right or  power,  and a waiver  on one  occasion  shall  not be
construed  as a  waiver  or a bar to the  exercise  of any  right  on any  other
occasion.  Any  provision  in this  Note  which is  prohibited  by law  shall be
ineffective to the extent of such  prohibition  without  invalidating  any other
provision hereof.

         The rights and  remedies of the holder of this Note as provided in this
Note  shall  be  cumulative  and   concurrent,   and  may  be  pursued   singly,
successively,  or together against the Payee for the payment hereof or otherwise
at the sole  discretion of the Payee.  The failure to exercise any such right or
remedy  shall in no event be  construed as a waiver or release of said rights or
remedies or of the right to exercise them at any time later.

         This  Note  may not be  changed  or  terminated  orally,  but only by a
writing  signed  by the  Maker and the  Payee.  This  Note may not be  endorsed,
assigned or transferred by the Payee without the consent of Maker.

         The Note shall be governed and construed under the substantive  laws of
the State of  Pennsylvania,  without regard to its conflicts of laws principles.
This Note and the attached Pledge






and  Security  Agreement  constitute  the entire  agreement of the Maker and the
Payee with respect to the indebtedness  evidenced hereby.  Pursuant to the terms
of the Pledge and Security  Agreement,  Maker has collateralized  this Note with
315,774 shares of the Maker's Common Stock.

         The Maker agrees to pay all costs, charges and expenses incurred by the
Payee and its assigns (including, without limitation, costs of collection, court
costs and reasonable  attorneys' fees and  disbursements) in connection with the
enforcement of the Payee's rights under this Note.

         Executed as a sealed instrument as of the date set forth above.



                                                      /s/ Lee N. Blatt
                                                       ------------------
                                                        Lee N. Blatt