Document:

SUBORDINATION AGREEMENT

 EXHIBIT 10.7 
  

			
	

	 	 SUBORDINATION AGREEMENT

	 	 (All Indebtedness and Liens)

  
 Quantum-Veritek, Inc.
(“Borrower”) is indebted to the undersigned (“Creditor”) in the principal sum of Five Million Nine Hundred Thousand Dollars ($5,900,000) evidenced by  ̈ an open account x a promissory note  ̈ other (describe)
N/A         which indebtedness is  ̈ unsecured x
secured by all personal property of Borrower and Creditor is or may become financially interested in Borrower and desires to aid Borrower in obtaining or having continued financial accommodations, whether by way of loan, commitment to loan,
discounting of instruments, extensions of credit or the obtaining of any other financial aid from Comerica Bank (“Bank”). 
  
 In order to induce the Bank to extend or to continue to extend financial accommodations to Borrower from time to time, whether by way of a loan, commitment to loan,
discounting of instruments, extension of credit or otherwise and in consideration of any of these financial accommodations, Creditor agrees as follows: 
  

	1.	Any and all obligations and liabilities of Borrower to Creditor, including, without limit, principal and interest payments, whether direct or indirect, absolute or contingent, joint
or several, secured or unsecured, due or to become due, now existing or later arising and whatever the amount and however evidenced (the “Subordinated Indebtedness”), are subordinated in right of payment to any and all obligations and
liabilities of Borrower to the Bank, including, without limit, principal and interest payments, whether direct or indirect, absolute or contingent, joint or several, secured or unsecured, due or to become due, now existing or later arising and
however evidenced, together with all other sums due thereon and all costs of collecting the same (including, without limit, reasonable attorney fees) for which Borrower is liable (the “Senior Indebtedness”). 

  

	2.	Creditor will not ask for, demand, sue for, take or receive (by way of voluntary payment, acceleration, set-off or counterclaim, foreclosure or other realization on security,
dividends in bankruptcy or otherwise), or offer to make any discharge or release of, any of the Subordinated Indebtedness, and Creditor waives any such rights with respect to the Subordinated Indebtedness nor shall Creditor exercise any rights of
subrogation or other similar rights with respect to the Senior Indebtedness. 

  

	3.	Creditor will not exercise any of Creditor’s rights in any collateral now or later securing the Subordinated Indebtedness. All rights of Creditor in any collateral now or later
securing the Subordinated Indebtedness are subordinated to all rights of the Bank now or later existing in any of the same collateral securing the Senior Indebtedness. Creditor waives all rights to require the Bank to marshall the collateral for the
Senior Indebtedness or any other property the Bank may at any time have as security for the Senior Indebtedness and waives all right to require the Bank to first proceed against any guarantor or other person before proceeding against such
collateral. Creditor shall not contest the validity, priority or perfection of the Bank’s security interest in any collateral in which the Creditor may also have an interest. The priorities of the Bank and the Creditor in such collateral shall
be in accordance with this Agreement, regardless of whether the Bank’s security interest or lien in such collateral is valid or perfected. The Bank may take action to foreclose or otherwise realize upon, or protect its interest in, the
collateral, in accordance with its agreements with the Borrower, at any time, without the consent of Creditor, and Creditor agrees not to interfere in a manner which would defeat the purpose of this Agreement in connection therewith. So long as any
part of the Senior Indebtedness is outstanding, if the Bank has agreed to release its security interest in any of the collateral in connection with the realization of any of its rights with respect to such collateral, the Bank is hereby authorized
as Creditor’s attorney in fact to execute releases and discharges of Creditor’s liens and security interests in such collateral provided that the Bank is releasing or discharging the Bank’s security interest in such collateral as part
of the same transaction and provided that the Bank gives Creditor five (5) days prior written notice of such release during which such five (5) day period Creditor does not sign and deliver to the Bank any such releases and discharges. The
subordination and postponement in priority, operation and effect of the security interests of the Creditor shall have the same force and effect as though the security interests of the Bank had attached and were perfected by filing or otherwise prior
to the time the security interests of the Creditor attached and/or were perfected. Creditor agrees that its liens and security interests in the Collateral shall secure only the Creditor loan and no other obligations or liabilities of Borrower to
Creditor. 

  

	4.	Creditor authorizes and empowers the Bank to demand, enforce payment by legal proceedings, receive and give acquittances for the Subordinated Indebtedness and to exercise all rights
of Creditor in any security (other than a deed of trust, mortgage or security interest covering real property or a principal dwelling) now or later held for the Subordinated Indebtedness. As collateral for the Senior Indebtedness, Creditor hereby
pledges, assigns and 

 grants to Bank a security interest in the Subordinated Indebtedness, any collateral or other security
(other than a deed of trust, mortgage or security interest covering real property or a principal dwelling) for the Subordinated Indebtedness, and all claims or demands of Creditor in connection therewith, with full right on the part of the Bank, in
its own name or in the name of Creditor, to collect and enforce these claims or demands, by suit, proof of debt in bankruptcy, or in any other proceeding involving dissolution, insolvency, liquidation or an adjustment of the indebtedness of
Borrower. The Bank has no obligation to the Creditor to take any steps with regard to these claims or demands, the Subordinated Indebtedness, or any collateral or other security for the Subordinated Indebtedness. 
  

	5.	Should any payment, distribution or security or proceeds from these be received by Creditor upon or with respect to the Subordinated Indebtedness prior to the satisfaction in full
of the Senior Indebtedness, Creditor shall immediately deliver same to the Bank in the form received (except for endorsement or assignment by Creditor where required by the Bank), for application on the Senior Indebtedness (whether or not then due
and in such order of maturity as Bank elects) and, until so delivered, the same shall be held in trust by Creditor as the property of the Bank. 

  

	6.	Creditor represents and warrants that it has not made or permitted to be made and shall not make or permit any assignment, transfer, pledge, or disposition for collateral purposes
or otherwise, of all or any part of the Subordinated Indebtedness or any collateral or other security for the Subordinated Indebtedness so long as this Agreement remains in effect. Creditor shall, on the date of this Agreement or promptly upon
receipt if not yet delivered to Creditor, deliver to the Bank, endorsed if required by the Bank, all notes and other instruments evidencing any Subordinated Indebtedness. Creditor agrees to execute all financing statements deemed necessary by the
Bank to perfect the Bank’s rights and interests under this Agreement. The Bank is to have all the rights and remedies of a secured creditor under the Michigan Uniform Commercial Code, as amended from time to time, with respect to such
interests. Creditor further makes, constitutes and appoints Bank its true and lawful attorney-in-fact with full power of substitution to take any action in furtherance of this Agreement, including, but not limited to, the signing of financing
statements, endorsing of instruments, and the execution and delivery of all documents and agreements necessary to obtain or accomplish any protection for or collection or disposition of any part of any collateral. Such appointment shall be deemed
irrevocable and coupled with an interest. 

  

	7.	This Agreement constitutes a continuing agreement of subordination, even though at times Borrower is not indebted to the Bank. The Bank may continue, in reliance on this Agreement,
without notice to Creditor, to lend monies, extend credit, modify, renew or make other financial accommodations, to or for the account of Borrower until the fifth (5th) day (“effective date”) following written acknowledgment by an officer
of the Bank that the Bank received written notice of revocation of this Agreement from Creditor. Any such notice of revocation shall not be effective as to any Senior Indebtedness existing at the effective date of revocation or any Senior
Indebtedness created after that pursuant to any commitment or agreement of the Bank or pursuant to any Borrower loan (whether advances or readvances by the Bank after the effective date of revocation are optional or obligatory) existing at the
effective date of revocation or any modifications or renewals of any such Senior Indebtedness, whether in whole or in part. Possession by the Bank of any note or other evidence of indebtedness made, endorsed or guaranteed by Borrower shall be
conclusive evidence (but not the only means of establishing) that Borrower is indebted to the Bank. 

  

	8.	Creditor shall indemnify the Bank against all claims, damages, costs, and expenses, including, without limit, reasonable attorneys’ fees, incurred by the Bank in connection
with any suit, claim or action against the Bank arising out of any modification or termination of a Borrower loan or any refusal by the Bank to extend additional credit relating to the revocation of this Agreement. 

  

	9.	Creditor delivers this Agreement based solely on Creditor’s independent investigation of (or decision not to investigate) the financial condition of Borrower and is not relying
on any information furnished by the Bank. Creditor assumes full responsibility for obtaining any further information concerning Borrower’s financial condition, the status of the Senior Indebtedness or any other matter which Creditor may deem
necessary or appropriate now or later. Creditor waives any duty on the part of the Bank, and agrees that Creditor is not relying upon nor expecting the Bank to disclose to Creditor any fact now or later known by the Bank, whether relating to the
operations or condition of Borrower, the existence, liabilities or financial condition of any guarantor of the Senior Indebtedness, the occurrence of any default with respect to the Senior Indebtedness, or otherwise, notwithstanding any effect such
fact may have upon Creditor’s risk or Creditor’s rights against Borrower. Creditor knowingly accepts the full range of risk encompassed in this Agreement, which risk includes, without limit, the 

  

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 possibility that Borrower may incur Senior Indebtedness to the Bank after the financial condition of
Borrower, or its ability to pay Borrower’s debts as they mature, has deteriorated. Creditor acknowledges and agrees that the Bank’s rights under this Agreement are not conditioned upon pursuit by the Bank of any remedy the Bank may have
against Borrower or any other person or any other security. The absence of Borrower’s signature at the end of this Agreement shall in no way impair or affect the validity of this Agreement. 
  

	10.	The Bank, in its sole discretion, without notice to Creditor, may release, exchange, enforce and otherwise deal with any security now or later held by the Bank for payment of the
Senior Indebtedness or release any party now or later liable for payment of the Senior Indebtedness without affecting in any manner the Bank’s rights under this Agreement. Creditor acknowledges and agrees that the Bank has no obligation to
acquire or perfect any lien on or security interest in any asset(s), whether realty or personalty, to secure payment of the Senior Indebtedness, and Creditor is not relying upon assets in which the Bank has or may have a lien or security interest
for payment of the Senior Indebtedness. 

  

	11.	Notwithstanding any prior revocation, termination, surrender, or discharge of this Agreement in whole or in part, the effectiveness of this Agreement shall automatically continue or
be reinstated in the event that any payment received or credit given by the Bank in respect of the Senior Indebtedness is returned, disgorged, or rescinded under any applicable state or federal law, including, without limitation, laws pertaining to
bankruptcy or insolvency, in which case this Agreement, shall be enforceable against the Creditor as if the returned, disgorged, or rescinded payment or credit had not been received or given by the Bank, and whether or not the Bank relied upon this
payment or credit or changed its position as a consequence of it. In the event of continuation or reinstatement of this Agreement, the Creditor agrees upon demand by the Bank to execute and deliver to the Bank those documents which the Bank
determines are appropriate to further evidence (in the public records or otherwise) this continuation or reinstatement, although the failure of the Creditor to do so shall not affect in any way the reinstatement or continuation.

  

	12.	Creditor waives any right to require the Bank to: (a) proceed against any person or property; (b) give notice of the terms, time and place of any public or private sale of personal
property security held from Borrower or any other person, or otherwise comply with the provisions of Section 9-611 or 9-621 of the Michigan or other applicable Uniform Commercial Code, as the same may be amended, revised or replaced from time to
time; or (c) pursue any other remedy in the Bank’s power. Creditor waives notice of acceptance of this Agreement and presentment, demand, protest, notice of protest, dishonor, notice of dishonor, notice of default, notice of intent to
accelerate or demand payment of any Senior Indebtedness, any and all other notices to which the undersigned might otherwise be entitled, and diligence in collecting any Senior Indebtedness, and agrees that the Bank may, once or any number of times,
modify the terms of any Senior Indebtedness, compromise, extend, increase, accelerate, renew or forbear to enforce payment of any or all Senior Indebtedness, or permit the Borrower to incur additional Senior Indebtedness, all without notice to
Creditor and without affecting in any manner the unconditional obligations of Creditor under this Agreement. 

  

	13.	Creditor acknowledges that the Bank has the right to sell, assign, transfer, negotiate or grant participations or any interest in, any or all of the Senior Indebtedness and any
related obligations, including without limit this Agreement. In connection with the above, but without limiting its ability to make other disclosures to the full extent allowable, the Bank may disclose all documents and information which the Bank
now or later has or acquires relating to Creditor and this Agreement, however obtained. Creditor further agrees that the Bank may disclose such documents and information to Borrower. Creditor further agrees that the Bank may provide information
relating to this Agreement or relating to Creditor to the Bank’s parent, affiliates, subsidiaries and service providers. 

  

	14.	No waiver or modification of any of its rights under this Agreement shall be effective unless the waiver or modification shall be in writing and signed by an authorized officer on
behalf of the Bank. Each waiver or modification shall be a waiver or modification only with respect to the specific matter to which the waiver or modification relates and shall in no way impair the rights of the Bank or the obligations of Creditor
to the Bank in any other respect. 

  

	15.	This Agreement shall bind and be for the benefit of Creditor and the Bank and their respective successors and assigns, and shall be construed according to the laws of the State of
Michigan, without regard to conflict of laws principles. If this Agreement is executed by two or more persons, it shall bind each of them individually as well as jointly. 

  

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	16.	The term “Borrower”, as used in this Agreement, includes any person, corporation, partnership or other entity which succeeds to the interests or business of Borrower named
above, and the terms “Senior Indebtedness” and “Subordinated Indebtedness” include indebtedness of any successor Borrower to the Bank and Creditor. 

  

	17.	Creditor agrees to reimburse the Bank upon demand for any and all costs and expenses (including, without limit, court costs, legal fees, and reasonable attorney fees whether inside
or outside counsel is used, whether or not suit is instituted and, if instituted, whether at the trial or appellate level, in a bankruptcy, probate or administrative proceeding, or otherwise) incurred in enforcing any of the duties and obligations
of Creditor under this Agreement. 

  

	18.	Creditor waives any defense against the enforceability of this Agreement based upon or arising by reason of the application by Borrower of the proceeds of any Indebtedness for
purposes other than the purposes represented by Borrower to the Bank or intended or understood by the Bank or Creditor. Creditor waives all rights to require the Bank to marshall the Collateral or any other property the Bank may at any time have as
security for the Indebtedness and waives all right to require the Bank to first proceed against any guarantor or other person before proceeding against the Collateral. 

  

	19.	The relative priorities of the Bank and Creditor in the Collateral as set forth in this Agreement control irrespective of the time, method or order of attachment or perfection of
the liens and security interests acquired by the parties in the Collateral and irrespective of the priorities as would otherwise be determined by reference to the Uniform Commercial Code or other applicable laws. Creditor shall not contest the
validity, priority or perfection of the Bank’s security interest in the Collateral (regardless of whether the Bank’s security interest in the Collateral is valid or perfected). The priorities of any liens or security interests of the
parties in any property of the Borrower other than the Collateral are not affected by this Agreement and shall be determined by reference to applicable law. The Bank’s rights under this Agreement are in addition to, and not in substitution of,
its rights under any other subordination agreement with Creditor. 

  

	20.	Special Provisions: Notwithstanding anything to the contrary in this Agreement, Creditor may ask for, demand, sue for, take or receive from Borrower, the regularly scheduled
payments of interest (but not prepayments, whether voluntary or by acceleration or otherwise) which may come due under the above-described promissory note (“Note”); provided, however, that Creditor may not ask for, demand, sue for, take or
receive from Borrower any such payments after Creditor is given written notice by the Bank that a Default or Event of Default exists or has occurred under any note(s), guaranty(ies), and/or agreement(s) between the Bank and the Borrower or that any
loan(s) between Borrower and Bank has (have) been called. All such payments due Creditor under the Note must be suspended until such time (if ever) as Creditor receives subsequent written notice from the Bank stating that the Default has been cured
and/or the loan(s) has (have) been paid. The Bank agrees to give Borrower copies of the notices, but the Bank’s failure to do so shall not affect its rights under this Agreement or any other Agreement with Borrower. 

  
 The Note may not be modified or prepaid or accelerated without the prior
written consent of the Bank. 
  
 THE UNDERSIGNED AND THE BANK ACKNOWLEDGE THAT
THE RIGHT TO TRIAL BY JURY IS A CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED. EACH PARTY, AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR CHOICE, KNOWINGLY AND VOLUNTARILY, AND FOR THEIR MUTUAL BENEFIT, WAIVES ANY
RIGHT TO TRIAL BY JURY IN THE EVENT OF LITIGATION REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN ANY WAY RELATED TO, THIS AGREEMENT. 
  
 IN WITNESS WHEREOF, Creditor has caused this Agreement to be executed as of November 3, 2003. 
  
  

			
	 QUANTUM VALUE PARTNERS.L.P.

	 [CREDITOR]

		
	 BY:
	 	 Quantum Value Management, LLC, its General Partner

		
	 BY:
	 	 /s/ Michael Azar

	 ITS:
	 	 Managing Member

  

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 BORROWER’S ACKNOWLEDGMENT 
  
 Quantum-Veritek, Inc. (“Borrower”) accepts notice of subordination created by this Agreement and agrees that it will take no
action inconsistent with this Agreement and that, except as permitted by this Agreement or with the prior written approval of Bank, no payment or distribution shall be made by Borrower on or with respect to the Subordinated Indebtedness, so long as
this Agreement remains in effect. Borrower agrees that the Bank may, at its option, without notice and without limiting Bank’s other rights, upon any breach by Creditor of, or purported termination by the Creditor of, this Agreement, declare
all Senior Indebtedness to be immediately due and payable and/or terminate any commitments of Bank to Borrower. 
  

									
	 QUANTUM-VERITEK. INC.

	 	 BORROWER’S ADDRESS

	 [BORROWER]
	 	 	 	 
			
	 BY:
	 	 /s/ James C. Juranitch

	 	 30120 West Pontiac

	 	 	 SIGNATURE OF
	 	 STREET ADDRESS

					
	 ITS:
	 	 Pres/CEO

	 	 Wixom

	 	 Michigan

	 	 48393

	 	 	 TITLE (IF APPLICABLE)
	 	 CITY
	 	 STATE
	 	 ZIP

			
	 	 	 	 	 Dated: November 3, 2003

  

 520% SUBORDINATED NOTE DUE 2008

 Exhibit 10.9 
  
 QUANTUM VALUE PARTNERS, LP. 
  

20% SUBORDINATED NOTE DUE 2008 
  

			
	$5,900,000	 	Dated: October 31, 2003

  
 FOR VALUE RECEIVED,
the undersigned, Quantum-Veritek, Inc. a Michigan corporation (the “Company”), hereby promises to pay to the order of Quantum Value Partners, LP (“Payee”), at Payee’s address as specified below (or at such other place as the
holder of this Note (the “Holder”) may from time to time hereafter direct by notice in writing to the Company), the principal amount of $5,900,000 on August 1, 2008 (the “Maturity Date”). 
  
 1. Interest and Payment. 
  
 I.A.1.1. This Note shall bear interest on the principal amount thereof outstanding from time to time at the rate of 20% per annum.
Commencing April 1, 2004, Payee shall make interest only payments in cash equal to eight percent per annum on the outstanding balance. Commencing April 1, 2004, in lieu of payment of the additional 12% per annum interest that would otherwise be paid
on the interest payment date, Company shall increase the principal balance due hereunder by an amount equal to the amount of such cash that would otherwise have been paid to Holder. The interest shall payable quarterly in arrears commencing April 1,
2004 and each quarter thereafter (each, an Interest Payment Date”), and on the Maturity Date together with the principal amount of this Note at the time outstanding. Interest shall be computed on the basis of a 360-day year of twelve 30-day
months, for the actual number of days elapsed. Notwithstanding anything to the contrary contained in this Note, the Company shall not be obligated to pay, and the Holder shall not be entitled to charge, collect or receive interest in excess of the
maximum rate allowed by applicable law. If during any period of time the interest rate specified herein exceeds such maximum rate, then, any amounts of interest collected by the Holder in excess of such maximum rate shall be applied to the reduction
of the unpaid principal amount of this Note. 
  
 I.A.1.2. All payments of the
principal of, accrued interest on, and other amounts payable under this Note shall be payable in such coin or currency of the United States of America as at the time shall be legal tender for the payment of public and private debts. At the option of
the Holder of this Note, the Company will make all payments on account of this Note by electronic funds transfer in funds immediately available at the place of payment to a deposit account with a commercial bank designated by the Holder in writing
at least three business days prior to the relevant Interest Payment Date, Maturity Date or any prepayment date. All payments received on account of this Note shall be applied first to the payment of accrued and unpaid interest on this Note and then
to the reduction of the unpaid principal amount of this Note. 
  
 I.A.1.3. In the
event that the date for the payment of any amount payable under this Note falls due on a Saturday, Sunday or public holiday under the laws of the State of Michigan, the time for payment of such amount shall be extended to the next succeeding
business day and any principal amount otherwise due and payable shall continue to bear interest until paid in full on such extended payment date. 
  

 2. Prepayment. The Company may, upon at least five business days prior written notice to the Holder of this Note,
prepay the principal of this Note outstanding at any time in whole at any time and in part from time to time, without penalty or premium, thereof together with interest on the principal amount being prepaid accrued through the date of prepayment.

  
 3. Covenants. So long as any portion of the indebtedness evidenced by
this Note, whether principal, accrued and unpaid interest or any other amount at any time due hereunder remains unpaid, the Company covenants and agrees that: 
  

I.A.3.1. It will duly and punctually pay the principal of, and accrued interest on, and other amounts payable under this Note in each case, in accordance with the
terms of this Note. 
  
 I.A.3.2. It will promptly pay or discharge, and will cause
each of its subsidiaries to pay or discharge, before the same may become delinquent, (a) all taxes, assessments and governmental charges levied or imposed upon the Company or any such subsidiary, and (b) all claims for labor, materials and supplies
which, if unpaid, might by law become a lien or charge upon the property of the Company; or any such subsidiary; provided, however, that neither the Company nor any such subsidiary shall be required to pay or discharge, or cause to be paid or
discharged, any such tax, assessment, charge or claim (i) whose amount, applicability or validity is being contested in good faith by appropriate proceedings, or (ii) if the effect of such failure to pay or discharge would not have a material
adverse effect on the assets, business, operations, properties or condition (financial or otherwise) of the Company and its subsidiaries taken as a whole. 
  
 I.A.3.3. It will deliver to the Holder of this Note, forthwith upon any executive officer of the Company becoming aware of the existence of a default in performance of
any covenant hereunder which with or without the giving of notice or lapse of time or both would have a material adverse effect on the ability of the Company to perform its obligation under the Notes or on the consolidated financial condition or
operating results of the Company, Event of Default or material adverse change in the financial condition or results of operations of the Company and its subsidiaries, on a consolidated basis, a notice specifying with particularity such default,
Event of Default or material adverse change and further stating what action the Company has taken, is taking or proposes to take with respect thereto. 
  
 I.A.3.4. It shall, and shall cause each of its subsidiaries to, keep its books, records and accounts in accordance with generally accepted accounting principles applied
on a basis consistent with preceding years. 
  
 I.A.3.5. It will maintain, and
shall cause each of its subsidiaries to maintain, with financially sound and responsible insurers, insurance with respect to its properties and business against such casualties and contingencies and in such amounts as are customary’ in the case
of similarly situated corporations engaged in the same or similar business. 
  
 I.A.3.6. Except to the extent otherwise permitted by this Note, it will, and will cause each of its subsidiaries to, (i) do or cause or cause to be done all things reasonably necessary to preserve, renew and keep in full force and effect
its corporate existence, except that any such subsidiary may merge with or into the Company or any other subsidiary of the Company so long as the surviving corporation of the merger is the Company or a wholly-owned subsidiary of the Company; (ii) at
all times maintain, preserve and protect all of its patents, trademarks, service marks, trade names, service names, copyrights, licenses, 

  

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permits franchises and other rights, including distributorship and franchise agreements, that continue to be useful in some material respect in the conduct
of its business; and (iii) preserve all the remainder of its property useful in the conduct of its business and keep the same in good repair, working order and condition (ordinary wear and tear excepted), and from time to time, make, or cause to be
made, all needful and proper repairs, renewals, replacements, betterments and improvements thereto so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided, that nothing in this
Section IA3.6 shall prevent the Company or any subsidiary of the Company from discontinuing the use, operation or maintenance of any of such properties, or disposing of any of them, if such discontinuance or disposal is, in the judgment of the board
of directors of the Company or such subsidiary, or of any executive officer of the Company or any such subsidiary, as applicable, having managerial responsibility for any such property, desirable in the conduct of the business of the Company or such
subsidiary. It will, and will cause each subsidiary of the Company to, remain in substantially the same businesses in which the Company and its subsidiaries are engaged as of the date of this Note or in other types of businesses reasonably related
or incidental thereto, except to the extent that any such business of the Company or any such subsidiary is continued by the Company or any other subsidiary of the Company. 
  
 I.A.3.7 It will not, and will not permit any subsidiary of the Company to, make or have outstanding any loan or advance to, or own purchase
or acquire any obligations (other than accounts receivable generated in the ordinary course of business) or securities of, or any interest in, or make any capital contribution to or acquire all or substantially all of the assets of, any other person
or entity, other than: (a) strategic investments which in the good faith business judgment of the board of directors of the Company or the board of directors of the subsidiary of the Company which proposes to make such investment, as the case may
be, are in furtherance of the business purposes of the Company or such subsidiary; (b) endorsement of negotiable instruments for collection or deposit in the ordinary course of business; (c) ownership of stock of the Company’s subsidiaries; and
(d) prepayment of the Notes as permitted by the terms thereof. 
  
 I.A.3.8. It
will, and will cause each of its subsidiaries to, comply, in all material respects with all requirements of law and contractual obligations applicable to or binding upon any of them. 
  
 I.A.3.9. It will not, and will not permit any subsidiaries to, directly or indirectly purchase, acquire or lease any property from, or sell,
transfer or lease any property to, or otherwise deal with, in the ordinary course of business or otherwise, any affiliate of the Company or such subsidiary, except upon terms not less favorable to Company or such subsidiary than if the Affiliate
relationship did not exist and provided the transaction is approved by a majority of the independent directors of the board of directors of the Company. 
  
 4. Events of Default. If any of the following events (each an “Event of Default”) shall occur: 
  
 I.A.4.1. The Company fails to pay the principal of, any installment of interest accrued on,
or any other amount which becomes due under, this Note or any of the other Notes as and when the same becomes due and payable hereunder or thereunder; or 
  
 I.A.4.2. The Company defaults in the due observance or performance of any of its covenants contained in this Note or any of the other Notes (other than a Default
involving the payment of money due under this Note or any of the other Notes) and such default is not cured within 10 days after the occurrence of such default; or 
  

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 I.A.4.3. The Company or any subsidiary thereof shall (i) become insolvent, however evidenced, (ii) apply for or consent
to the appointment of, or the taking of possession by, a receiver, trustee or similar official of or for itself or of or for all or a substantial part of its property, (iii) make an assignment for the benefit of its creditors, (iv) commence a
voluntary case under the Federal Bankruptcy Code, as now or hereafter in effect (the “Code”), (v) file a petition seeking to take advantage of any other bankruptcy, insolvency, moratorium, reorganization or other similar law of any
jurisdiction, (vi) acquiesce as to or fail to controvert in a timely or appropriate manner, an involuntary case filed against the Company or such subsidiary under the Code, or (vii) take any corporate action in furtherance of any of the foregoing;
or 
  
 I.A.4.4. A proceeding or involuntary case shall be commenced, without the
application or consent of the Company or any subsidiary thereof, in any court of competent jurisdiction, seeking (i) the liquidation, reorganization, dissolution, winding up or composition or readjustment of its debts, (ii) the appointment of a
trustee, receiver or similar official for it or for all or any substantial part of its assets, or (iii) similar relief in respect of it under any law providing for the relief of debtors, and any such proceeding or case shall continue undismissed, or
unstayed and in effect, for a period of 90 days; or 
  
 I.A.4.5. The dissolution
of the Company or any of its subsidiaries or any vote in favor thereof by the board of directors and shareholders of the Company or such subsidiary, provided that any subsidiary may be dissolved to the extent its assets are transferred to, and its
liabilities are assumed by, the Company or another subsidiary of the Company or to the extent such dissolution would not have an adverse effect on the Company and its subsidiaries taken as a whole. 
  
 5. Suits for Enforcement and Remedies. If any one or more Events of Default shall
occur, the Holder may proceed to (i) protect and enforce Holder’s rights either by suit in equity or by action at law, or both, whether for the specific performance of any covenant, condition or agreement contained in this Note or in any
agreement or document referred to herein or in aid of the exercise of any power granted in this Note or in any agreement or document referred to herein, (ii) enforce the payment of this Note, or (iii) enforce any other legal or equitable right of
the Holder. No right or remedy herein or in any other agreement or instrument conferred upon the holder of this Note is intended to be exclusive of any other right or remedy, and each and every such right or remedy shall be cumulative and shall be
in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 
  
 6. Restriction on Transfer. This Note has been acquired for investment and has not been registered under the securities laws of the United States of America or any
state thereof. Accordingly, neither this Note nor any interest therein may be offered for sale, sold or transferred in the absence of registration and qualification of this Note under applicable federal and state securities laws or an opinion of
counsel of the Holder reasonably satisfactory to the Company that such registration and qualification are not required. 
  

 4 

 7. Subordination. 
  
 I.A.7.1. The Company covenants and agrees, and the Holder, by his or its acceptance hereof, likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Section 7 the indebtedness represented by this Note (and the other Notes) and the payment of the principal of accrued interest on, and all other amounts payable in respect of this Note (and the other Notes) are hereby
expressly made subordinate and subject in right of payment to the prior payment in full of all Senior Indebtedness. 
  
 I.A.7.2. As used in this Section 7, the following capitalized terms will have the definition set forth below: 
  
 “Senior Indebtedness” means, without duplication, (i) the principal
of, and premium (if any), and unpaid interest and fees on, all present and future (a) obligations incurred by the Company and/or any of its subsidiaries (whether as borrower or guarantor) under or pursuant to any loan or credit agreement between or
among the Company and/or any of its subsidiaries and one or more banks and/or other institutional lenders (each, a “Financing Agreement”), or any agreement between or among the Company and/or any of its subsidiaries and one or more banks
and/or other institutional lenders providing for the extension, amendment renewal, refunding or refinancing of such obligations (a “Refinancing Agreement”), whether now existing or hereafter entered into or contracted, including, without
limitation, the principal balance of all loans made thereunder and interest and fees accruing with respect to such loans and (b) all other obligations, liabilities, and indebtedness incurred by the Company and/or any of its subsidiaries under or
pursuant to any Financing Agreement or Refinancing Agreement, including, without limitation, reimbursement obligations with respect to letters of credit issued pursuant to a Financing Agreement or a Refinancing Agreement (and all fees, commissions
and charges incurred in connection with the issuance and maintenance of such letters of credit) or obligations with respect to acceptances issued or overdrafts extended pursuant to a Financing Agreement or a Refinancing Agreement; (ii) obligations
of the Company and/or any of its subsidiaries under direct or indirect guaranties in respect of, and obligations (contingent or otherwise) to purchase or otherwise acquire, or otherwise assure a creditor against loss in respect of, indebtedness or
obligations of others of the kind referred to in clause (i) above; (iii) indebtedness incurred by the Company and/or any subsidiaries of the Company to finance the acquisition by it of assets classified as capital assets under GAAP (“Purchase
Money Debt”); (iv) obligations of the Company and/or any of the Company Subsidiaries as lessee under leases required to be capitalized on the balance sheet of the lessee under generally accepted accounting principles; and (v) Acquisition
Indebtedness; in each case, (x) whether now existing or hereafter arising and whether such indebtedness or obligations arise or accrue before or after the commencement of any bankruptcy, insolvency or receivership proceedings, including, without
limitation, interest and fees accruing pre-petition or post-petition at the rate or rates prescribed in a Financing Agreement, a Refinancing Agreement, Purchase Money Debt and/or Acquisition Indebtedness/or any extension, renewal, refunding or
refinancing of any of the foregoing, and costs, expenses, and attorneys’ fees and disbursements, whenever incurred (and, whether or not such claims, interest, costs, expenses, fees or disbursements are allowed or allowable in any such
proceeding); and (y) unless the document, instrument or agreement creating or evidencing the indebtedness or obligation or pursuant to which the same is outstanding, provides (1) that such indebtedness is not superior in right of payment to the
Notes or (2) that such indebtedness or obligation shall be subordinated to any other such indebtedness or obligation, unless such indebtedness or obligation expressly provides that it shall be senior in right of payment to the Notes. 
  
 As used in the foregoing definition of “Senior Indebtedness”,
“Acquisition Indebtedness” means indebtedness of the Company and/or any of its subsidiaries payable to any entity or person in connection with an Acquisition from such entity or person, regardless of whether such indebtedness was created,
incurred or assumed by the Company and/or such subsidiary of the Company. 
  

 5 

 8. Miscellaneous 
  
 I.A.8.1. The obligations to make the payments provided for in this Note are absolute and unconditional and not subject to any defense, set-off, counterclaim, rescission,
recoupment or adjustment whatsoever. 
  
 I.A.8.2. If, following the occurrence of
an Event of Default, the Holder of this Note shall seek to enforce the collection of any amount of the principal of and/or accrued Interest on this Note, there shall be immediately due and payable by the Company, in addition to the then unpaid
principal of, and accrued unpaid interest on, this Note, all costs and expenses incurred by such Holder in connection therewith, including, without limitation, reasonable attorneys’ fees and disbursements. 
  
 I.A.8.3. No forbearance, indulgence, delay or failure to exercise any right or remedy with
respect to this Note shall operate as a waiver or as an acquiescence in any Default, nor shall any single or partial exercise of any right or remedy preclude any other or further exercise thereof or the exercise of any other right or remedy.

  
 I.A.8.4. This Note may not be modified or discharged (other than by payment)
except by a writing duly executed by the Company and Holder. 
  
 I.A.8.5. The
headings of various sections and subsections of this Note are for convenience of reference only and shall in no way modify any of the terms or provisions of this Note. 
  

 6 

 I.A.8.6. All notices required to be given to any of the parties hereunder shall be in writing and shall be deemed to have
been sufficiently given for all purposes when presented personally to such party, sent by facsimile (with the original timely mailed), or sent by registered, certified or express mail, return receipt requested, to such party at its address set forth
below: 
  
 if to the Company, to: 
  
 Quantum-Veritek, Inc. 
 28213 Van Dyke Avenue 
 Warren, MI 48093

 Attn: Michael C. Azar, Esq., General Counsel 
 Facsimile No: (586)582-9481 
  
 if to the Payee, to: 
  
 Quantum Value Partners,
LP 
 28213 Van Dyke Avenue 
 Warren, MI 48093 
 Attn: Michael C. Azar, Esq., General Counsel 
 Facsimile No: (586) 582-9481 
  
 or hereafter given to the other party hereto pursuant to the provisions of this Note. 
  
 I.A.8.7. The Company may not delegate its obligations under this Note and such attempted delegations shall be null and void. The Holder may
assign, pledge or otherwise transfer this Note without prior written consent of the Company. This Note inures to the benefit of Payee, its successors and its assignee of this Note and binds the Company, and its successors and assigns, and the terms
“Payee” and “the Company” whenever occurring herein shall be deemed and construed to include such respective successors and assigns. 
  
 I.A.8.8. This Note shall continue to be effective or be reinstated, as the case may be, if at any time any payment made pursuant to it is rescinded or must otherwise be
returned by the Holder upon bankruptcy or reorganization or otherwise of the Company, all as though such payment had not been made. 
  
 Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Note, and, in case of loss,
theft or destruction, of indemnity or security reasonably satisfactory to it, and reimbursement to the Company of all reasonable expenses incidental thereto, and upon surrender and cancellation of this Note, if mutilated, the Company will make and
deliver a new Note of like date and tenor, in lieu thereof. 
  

									
	  
 Pay to the order
of
 Comerica Bank, without recourse
	 	 	 	QUANTUM-VERITEK, INC.
	 	 	 	 	By:	 	 /s/ James Jufanitch

	 QUANTUM VALUE PARTNERS, LP
	 	 	 	 Name:
	 	 James Jufanitch

	 	 	 	 	 	 	 Title:
	 	 Pres/CEO

	 By:
	 	 QUANTUM Value Management, LLC
 its general
partner
	 	 	 	 	 	 
				
	 /s/ Michael C. Azar

	 	 	 	 	 	 
	 By:
	 	  

	 	 	 	 	 	 
	 ITS:
	 	  

	 	 	 	 	 	 

 Dated: November 3, 2003 
  

 7

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