Exhibit 10.7


 


This Instrument Prepared
By:


Great Western Bank


PO Box 2345


Sioux Falls, SD
57104


(605) 334-2548


 


SUBORDINATION
AGREEMENT


 


THIS SUBORDINATION AGREEMENT (the “Agreement”) is made and entered into
this 27th day of April, 2009, by and between Great
Western Bank, a banking corporation chartered under the laws of the
State of South Dakota with an address of 200 East 10th Street,
Suite 100, P.O. Box 2345, Sioux Falls, South Dakota 57101 (“Great
Western”), and Broadwind Energy, Inc., a
Delaware corporation with an address of 47 East Chicago Avenue, Suite 332,
Naperville, Illinois 60540 (“Broadwind”).


 


RECITALS


 


WHEREAS, Tower Tech Systems
Inc., a Wisconsin corporation and a wholly-owned subsidiary of Broadwind (“Tower
Tech”), desires to obtain a loan in the principal sum of $10,000,000 from Great
Western (the “Loan”) to be evidenced by a Promissory Note in the principal sum
of $10,000,000, which promissory note will be secured, in part, by a mortgage
security interest and fixture filing in the following described real property:


 


Lot Three (3), Block One (1), Corson Development
Park Addition to the City of Brandon, Minnehaha County, South Dakota,


 


including all structures and improvements located
thereon or appurtenant thereto (collectively, the “Building”);


 


WHEREAS, Tower Tech is presently indebted to
Broadwind;


 


WHEREAS, in order to induce
Great Western to provide the Loan to Tower Tech, Broadwind desires to enter
into this Agreement whereby Broadwind will subordinate any and all interest it
may have in any and all of the property, equipment, and other assets of Tower
Tech, whether now held or hereafter acquired, including, without limitation, the
Building (collectively, the “Collateral”) to the security interests of Great
Western in the Collateral, whether now held or hereafter acquired in connection
with the Loan, and absent the willingness of Broadwind to enter into this
Agreement, Great Western would have been unwilling to make the Loan to Tower
Tech; and


 

















 


WHEREAS, Broadwind acknowledges and agrees that it derives a
significant financial benefit from the ability of its wholly-owned subsidiary, Tower
Tech, to obtain the Loan from Great Western, and, as such, no further
consideration on the part of Great Western is either necessary or required to
make this Agreement a binding obligation of Broadwind following its execution
of this Agreement.


 


NOW, THEREFORE, in
consideration of the mutual representations, warranties, and covenants
contained herein, and of other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto do agree as
follows:


 


1.                                     Broadwind
agrees that any and all liens, rights, and security interests owned, claimed or
held, or to be owned, claimed or held by Broadwind in the Collateral or in any
other properties or assets of Tower Tech, whether now owned or hereafter
acquired, shall be in all things subordinate and inferior to any and all liens,
rights, and security interests owned, claimed or held by Great Western in such
Collateral and other properties or assets of Tower Tech, whether now existing
or hereafter claimed by Great Western, as such are pledged by Tower Tech in
connection with the Loan.


 


2.                                     Great Western
may, at any time, and from time to time, without the consent of or notice to
Broadwind, without incurring responsibility to Great Western, and without
impairing or releasing any of its rights, or any of the obligations of Great
Western hereunder:


 


a.                                       change the
interest rate, or the amount of Tower Tech’s payments; or extend the time of
payment, renew or otherwise alter the terms of the Loan or any instrument
evidencing the same in any manner; and


 


b.                                      exercise or
refrain from exercising any right against Tower Tech or others.


 


3.                                     No waiver shall
be deemed to be made by Great Western of any of its rights hereunder unless the
same shall be in writing signed on behalf of Great Western, and each such
waiver, if any, shall be a waiver only with respect to the specific matter or
matters to which the waiver relates and shall in no way impair the rights of
Great Western or the obligations of Tower Tech or Broadwind to Great Western in
any other respect at any other time. No change of law or circumstances shall
relieve or diminish the obligations, liabilities, agreements or duties hereunder
of Broadwind or affect this Agreement in any way or provide any recourse
against Great Western.


 


4.                                     This Agreement
shall be binding upon the parties, their respective successors and assigns, and
shall inure to the benefit of Great Western, its successors and assigns.


 


6.                                   This Agreement
shall be governed by and construed and enforced in accordance with the laws of
the State of South Dakota. The parties consent to the jurisdiction of the
courts


 

















 


of the State of South Dakota and agree that any action arising out of
or to enforce this Agreement must be brought and maintained in Minnehaha County,
South Dakota.


 


IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the date first written above.


 


	
   

  	
   

  	
  GREAT
  WESTERN BANK

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Richard
  L. Martin

  
	
   

  	
   

  	
  Richard
  L. Martin, Market President – Sioux Falls Market

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BROADWIND
  ENERGY, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J.
  Cameron Drecoll

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  J.
  Cameron Drecoll, Chief Executive Officer

  



 


	
  STATE OF SOUTH DAKOTA

  	
   

  	
  )

  
	
   

  	
   

  	
  : SS

  
	
  COUNTY OF MINNEHAHA

  	
   

  	
  )

  



 


On this, the 28 day of April, 2009, before me, the undersigned officer,
personally appeared Richard L. Martin, who acknowledged himself to be the
Market President - Sioux Falls Market of Great Western Bank, a banking
corporation chartered under the laws of the State of South Dakota, and that he,
as such Market President – Sioux Falls Market, being authorized so to do, executed
the foregoing instrument for the purposes therein contained by signing the name
of Great Western Bank by himself as Market President - Sioux Falls Market.


 


IN WITNESS WHEREOF,
I hereunto set my hand and official seal.


 


 


	
   

  	
  /s/ Gerald E.
  Kruger

  
	
  (SEAL)

  	
  Notary Public, South
  Dakota 

  My Commission Expires: Feb. 12, 2010

  



 

















 


	
  STATE OF ILLINOIS

  	
   

  	
  )

  
	
   

  	
   

  	
  : SS

  
	
  COUNTY OF COOK

  	
   

  	
  )

  



 


On this, the 27 day of April, 2009, before me, the
undersigned officer, personally appeared J. Cameron Drecoll, who acknowledged
himself to be the Chief Executive Officer of Broadwind Energy, Inc., a
Delaware corporation, and that he, as such Chief Executive Officer being authorized
so to do, executed the foregoing instrument for the purposes therein contained
by signing the name of the corporation by himself as Chief Executive Officer.


 


IN
WITNESS WHEREOF, I hereunto set my hand and official seal.


 


	
   

  	
  /s/ Beatriz
  Sanchez

  
	
  (SEAL)

  	
  Notary Public,

  
	
   

  	
  My Commission Expires:
  July 02, 2012