AMENDMENT TO NOTE AGREEMENT

           This  AMENDMENT TO NOTE  AGREEMENT,  dated as of  September  29, 1999
(this "Amendent")  among QUESTRON  OPERATING  COMPANY,  INC. and ALBION ALLIANCE
MEZZANINE FUND, L.P., ALLIANCE INVESTMENT OPPORTUNITIES FUND, LLC, THE EQUITABLE
LIFE  ASSURANCE  SOCIETY OF THE UNITED  STATES  and IBJ  WHITEHALL  BANK & TRUST
COMPANY  (collectively,  the "Purchasers") modifies that certain Note Agreement,
dated as of June 29, 1999 (the "Existing Note  Agreement;" and the Existing Note
Agreement as modified by this Amendment, the "Note Agreement") among the Company
and the Purchasers.

           WHEREAS,  pursuant to the Existing Note Agreement, the Company issued
to the  Purchaser  its 14.50%  Senior  Subordinated  Notes due June 30 2005 (the
"Notes")  in  the  aggregate   principal   amount  of  Twenty  Million   Dollars
($20,000,000); and

           WHEREAS, the Purchasers are the holders of all the outstanding Notes;
and

           WHEREAS,  the Company and the Purchasers  have agreed to waive,  on a
limited basis, certain provisions of the Existing Note Agreement.

           NOW, THEREFORE, for good and valuable consideration,  the receipt and
sufficiently  of which is  hereby  acknowledged,  the  parties  hereto  agree as
follows:

1.         DEFINED TERMS

           Capitalized  terms used and not  defined  herein  shall have the same
meanings given to them in the Note Agreement.

2.         CERTAIN AMENDMENTS AND AGREEMENTS.

2.1        Limited Waivers.

           Each  Purchaser  hereby  waives any default which might have occurred
pursuant  to Section  6.1(b) of the  Existing  Note  Agreement  by virtue of the
failure of the Company to comply with:

                     (a) Section 4.2 of the Existing Note Agreement with respect
           to any  failure by the  Company to maintain  the  specified  ratio of
           Consolidated  Senior Secured Funded Debt to Pro Forma Combined EBITDA
           for the period of four (4) full  consecutive  fiscal  quarters of the
           Company ended September 30, 1999;
<PAGE>

                     (b) Section 4.3 of the Existing Note Agreement with respect
           to any  failure by the  Company to maintain  the  specified  ratio of
           Total Funded Debt to Pro Forma Combined EBITDA for the period of four
           (4) full  consecutive  fiscal quarters of the Company ended September
           30, 1999; or

                     (c) Section 4.4 of the Existing Note Agreement with respect
           to any failure by the Company to maintain the specified  ratio of Pro
           Forma Combined EBITDA to Pro Forma Combined  Interest Expense for the
           period of four (4) full  consecutive  fiscal  quarters of the Company
           ended September 30, 1999.

          2.2        No Other Amendments.

           Except as expressly  set forth in Section 2.1, the  Purchasers do not
waive the occurrence of any other Event of Default. Specifically, the Purchasers
do not waive any Event of Default  arising other than pursuant to Section 6.1(b)
of the Existing Note Agreement,  any Event of Default pursuant to Section 6.1(b)
arising out of the failure by the  Company to comply with any  provision  of the
Existing Note Agreement other than Section 4.2,  Section 4.3 and Section 4.4, or
any Event of Default  pursuant to Section  6.1(b)  arising out of the failure by
the  Company to comply  with  Section  4.2,  Section  4.3 or Section  4.4 of the
Existing  Note  Agreement  for any fiscal  period of the Company  other than the
period  of four  (4) full  consecutive  fiscal  quarters  of the  Company  ended
September 30, 1999.

3.         NO OTHER MODIFICATIONS; CONFIRMATION .

           All the  provisions of the Notes,  and,  except as expressly  waived,
modified and  supplemented  hereby,  all the  provisions  of the  Existing  Note
Agreement,  are and shall remain in full force and effect.  As of the  Effective
Date (defined  below),  all  references in the Financing  Documents to the "Note
Agreement"  shall be references to the Existing Note  Agreement,  as modified by
this Amendment and as hereafter amended,  modified or supplemented in accordance
with its terms.

4.         REPRESENTATIONS AND WARRANTIES.

           The  Company  represents  and  warrants  as follows to each holder of
Notes as of the date hereof and as of the Effective Date (as defined below). The
Company  acknowledges and agrees that the representations and warranties of this
Section 4 comprise  representations and warranties in a written  modification to
the Note Agreement, as contemplated by Section 6.1(c) of the Note Agreement.

<PAGE>


          4.1        No Other Defaults.

           No Default  or Event of Default  (other  than  Defaults  or Events of
Default expressly and specifically  waived pursuant to the provisions of Section
2.1 of this Amendment) has occurred and is continuing.

     4.2        Senior Credit Agreement.

           The Senior Credit  Agreement (as amended as described in Section 5.3)
is the only Senior  Credit  Facility in existence  as of the date hereof.  After
giving effect to the  effectiveness  of this Amendment,  no unwaived  default or
event of default has occurred or is  continuing  in respect of any Senior Credit
Facility.

          4.3        Obligations Remain Enforceable.

           The  execution,  delivery  and  performance  by the  Company  of this
Amendment have been duly authorized by all necessary  corporate and other action
and do not and will not require any registration  with,  consent or approval of,
notice to or action by, any person  (including  any  Governmental  Authority) in
order to be effective and  enforceable.  The Note Agreement (as modified by this
Amendment) and the Notes constitute the legal,  valid and binding  obligation of
the Company,  enforceable  against Company in accordance with its terms,  except
that  the  enforceability  thereof  may be  limited  by  applicable  bankruptcy,
reorganization,  arrangement,  insolvency,  moratorium,  or other  similar  laws
affecting the enforceability of creditors' rights generally;  and subject to the
availability of equitable remedies.

          4.4        Securities Purchase Agreement Representations.

           All  representations  and warranties of the Company  contained in the
Securities   Purchase  Agreement  (other  than   representations  or  warranties
expressly  made only on and as of the Closing Date or any earlier date) are true
and correct as of the date hereof, after taking into account Section 2 above.

          4.5        Financial Information.

           All financial  statements  delivered to the Purchasers by the Company
pursuant to the provisions of Section 5.1(a),  Section 5.1(b) and Section 5.1(c)
of the Note Agreement since the Closing Date were, and all information delivered
to the  Purchasers  by the  Company  pursuant  to  Section  5.1(e)  of the  Note
Agreement since the Closing Date was, true, complete and correct in all material
respects as of the respective dates of such information.

<PAGE>

5.         EFFECTIVENESS

           This  Amendment  shall  become  effective  only  upon the date of the
satisfaction in full of the following  conditions precedent (which date shall be
the "Effective Date").

           5.1        Execution and Delivery of this Amendment.

           Each  Purchaser  shall  have  received  a  counterpart  hereof,  duly
executed and delivered by the Company and each other Purchaser.

           5.2        Acknowledgement by Affiliate Guarantors.

           Each Affiliate  Guarantor  shall have duly executed and delivered the
form of acknowledgement attached to this Amendment acknowledging its obligations
in respect of the Affiliate Guaranty.

           5.3        Senior Credit Agreement.

           The  Company  and  each of its  Affiliates  and  Subsidiaries  as are
parties to the Senior  Credit  Facility  shall have entered into an amendment to
the Senior Credit Agreement in the form attached hereto as Exhibit 5.3.

           5.4        Representations and Warranties.

           The  representations  and warranties of the Company made in Section 4
of this  Amendment  shall  remain  true and  correct in all  respects  as of the
Effective Date.

           5.5        No Injunction, Etc.

           No injunction,  writ,  restraining order or other order of any nature
prohibiting,  directly  or  indirectly,  the  consummation  of the  transactions
contemplated  herein  shall  have  been  issued  and  remain  in  force  by  any
Governmental Authority.

           5.6        Expenses.

           The  Company  shall  have  paid  all  out-of-pocket  expenses  of the
Purchasers  in connection  with the  execution  and delivery of this  Amendment,
including,  without limitation,  the fees and disbursements of Bingham Dana LLP,
as special counsel to the Required Holders.

<PAGE>


6.         MISCELLANEOUS

           6.1        Section Headings.

           The titles of the  Sections of this  Amendment  appear as a matter of
convenience  only,  do not  constitute  a part  hereof  and shall not affect the
construction  hereof.  The words  "herein,"  "hereof,"  "hereunder" and "hereto"
refer to this  Amendment as a whole and not to any  particular  Section or other
subdivision.  References to Sections are, unless otherwise specified, references
to Sections of this Amendment.

           6.2        Governing Law.

           THIS  AMENDMENT  SHALL BE GOVERNED BY, AND  CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK.

           6.3        Successors and Assigns.

           This Amendment  shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties hereto.  The provisions hereof are
intended to be for the benefit of all holders,  from time to time, of Notes, and
shall be enforceable by any such holder whether or not an express  assignment to
such holder of rights  hereunder  shall have been made by any  Purchaser  or its
successor or assign.

           6.4        Execution in Counterpart.

           This Amendment may be executed in one or more  counterparts and shall
be  effective  when at least one  counterpart  shall have been  executed by each
party hereto, and each set of counterparts that, collectively, show execution by
each party hereto shall constitute one duplicate original.

         [The remainder of this page has been left blank intentionally.
                     The next page is the signature page.]


<PAGE>


           IN WITNESS WHEREOF,  the parties hereto have caused this Amendment to
be duly executed and delivered by their  respective  proper and duly  authorized
officers as of the day and year first above written.


                                        QUESTRON OPERATING COMPANY, INC.



                                        By: /s/ Dominic A. Polimeni
                                            ------------------------------------
                                            Name:  Dominic A. Polimeni
                                            Title  Chairman and CEO



                                        ALBION ALLIANCE MEZZANINE FUND, L.P.
                                         By:  Albion Alliance LLC,
                                              its General Partner


                                        By: /s/ U. Peter C. Gummeson
                                            ------------------------------------
                                            Name:  U. Peter C. Gummeson
                                            Title  Senior Vice President


                                        ALLIANCE INVESTMENT
                                        OPPORTUNITIES FUND, LLC
                                        By: Alliance Investment Opportunities
                                            Management L.P., its Managing Member
                                        By: Alliance Capital Management, L.P.,
                                            its Managing Member
                                        By: Alliance Capital Management
                                            Corporation, its General Partner



                                        By: /s/ Nelson Jantgen
                                            ------------------------------------
                                            Name: Nelson Jantgen
                                            Title SVP
<PAGE>

                                       THE EQUITABLE LIFE ASSURANCE SOCIETY OF
                                       THE UNITED STATES



                                        By: /s/ U. Peter C. Gummeson
                                            ------------------------------------
                                            Name:  U. Peter C. Gummeson
                                            Title  Investment Officer


                                       IBJ WHITEHALL BANK & TRUST COMPANY



                                       By: /s/ Jean-Louis Pernin
                                           -------------------------------------
                                           Name:  Jean-Louis Pernin
                                           Title: Director


<PAGE>


                       ACKNOWLEDGEMENT AND CONFIRMATION OF
                              AFFILIATE GUARANTORS


           Each of the undersigned, being a party to that Unconditional Guaranty
(the  "Guaranty"),  dated as of June 29,  1999,  re:  $20,000,000  14.5%  Senior
Subordinated  Notes due June 30, 2005 (the "Notes") issued by Questron Operating
Company, Inc. (the "Company") acknowledges that:

                     (a) it has received and read the attached Amendment to Note
           Agreement;

                     (b) that it will benefit  materially and substantially from
           the  agreements  and  forbearances  made  by  the  Purchasers  in the
           attached Amendment to Note Agreement; and

                     (c) that its  guaranty of the  Guarantied  Obligations  (as
           defined in the Guaranty) and all of its other obligations pursuant to
           the Guaranty  shall  remain in full force and effect  notwithstanding
           the execution  and delivery by the Company and the  Purchasers of the
           attached  Amendment  to Note  Agreement  and the  performance  by the
           Company and the Purchasers of their respective  obligations  pursuant
           to the Notes  and the Note  Agreement  (as  defined  in the  attached
           Amendment to Note Agreement).

         [The remainder of this page has been left blank intentionally.
                     The next page is the signature page.]


<PAGE>


           IN WITNESS  WHEREOF,  each of the  undersigned  parties  hereto  have
caused this  Acknowledgement and Confirmation of Affiliate Guarantors to be duly
executed and delivered by their respective  proper and duly authorized  officers
as of the day and year first above written.

                            QUESTRON TECHNOLOGY, INC.
                            QUESTRON FINANCE CORP.
                            QUESTRON DISTRIBUTION LOGISTICS, INC.
                            COMP WARE, INC.
                            POWER COMPONENTS, INC.
                            INTEGRATED MATERIAL SYSTEMS, INC.
                            CALIFORNIA FASTENERS, INC.
                            FAS-TRONICS, INC.
                            FORTUNE INDUSTRIES, INC.
                            CAPITAL FASTENERS, INC.
                            ACTION THREADED PRODUCTS, INC.
                            ACTION THREADED PRODUCTS OF
                            GEORGIA, INC.
                            ACTION THREADED PRODUCTS OF
                            MINNESOTA, INC.



                            By: /s/ Dominic A. Polimeni
                                ------------------------------------------------
                                Name:  Dominic A. Polimeni
                                Title  Chairman and CEO



<PAGE>


                                   EXHIBIT 5.3
                      AMENDMENT TO SENIOR CREDIT AGREEMENT