FIRST AMENDMENT TO CONVERTIBLE SENIOR SUBORDINATED NOTE PURCHASE AGREEMENT

Exhibit 10.10

Execution Copy

FIRST AMENDMENT TO CONVERTIBLE SENIOR SUBORDINATED

NOTE PURCHASE AGREEMENT

This FIRST AMENDMENT TO CONVERTIBLE SENIOR SUBORDINATED NOTE PURCHASE AGREEMENT (this " Amendment "), made and entered into as of January 31, 2007, is by and between Tecstar Automotive Group, Inc. (f/k/a Starcraft Corporation), an Indiana corporation (the " Company "), and Whitebox Convertible Arbitrage Partners L.P., Whitebox Hedged High Yield Partners L.P., Pandora Select Partners L.P. and Whitebox Intermarket Partners L.P. (collectively, the " Purchasers ").

RECITALS

1. The Purchasers and the Company entered into a Convertible Senior Subordinated Note Purchase Agreement dated as of July 12, 2004 (the " Note Purchase Agreement "); and

2. The Company desires to amend certain provisions of the Note Purchase Agreement, and the Purchasers has agreed to make such amendments, subject to the terms and conditions set forth in this Amendment.

AGREEMENT

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto hereby covenant and agree to be bound as follows:

Section 1. Capitalized Terms . Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to them in the Note Purchase Agreement, unless the context shall otherwise require.

Section 2. Amendments . The Note Purchase Agreement is hereby amended as follows:

• 2.1 Authorization of Issuance of Notes . The first sentence of Article I of the Note Purchase Agreement is deleted in its entirety and the following inserted in lieu thereof:

  The Company has authorized the issue and sale to the Purchasers of $15,000,000 in aggregate principal amount of its 11.5% Convertible Subordinated Promissory Notes due July 1, 2009 (the notes being referred to herein as the "Notes"). At the election of the Purchasers in their sole discretion and upon written notice to the Company no later than May 15, 2009, such maturity date shall be extended until July 1, 2012.

  2.2 Definitions . The definitions of "SEC Reports" and "Latest Statement Date" as they appear in the Note Purchase Agreement shall be amended to read in their entireties as follows:

  "SEC Reports" shall mean the Company’s and/or Quantum Fuel Systems Technologies Worldwide, Inc.’s ("Quantum") current, quarterly, annual and other periodic filings filed with the Commission.

  "Latest Statement Date" shall mean October 31, 2006.

  2.3 Capitalization . Section 5.2 of the Note Purchase Agreement is amended to read in its entirety as follows:

  Section 5.2 Capitalization . The Company is a wholly owned subsidiary of Quantum with 1,000 authorized shares of Common Stock, all of which are issued and outstanding. The Company has no outstanding options, warrants or other rights to acquire any capital stock, or securities convertible or exchangeable for capital stock or for securities themselves convertible or exchangeable for capital stock (together, "Convertible Securities"). The Company has no other agreement or commitment to sell or issue any shares of capital stock or Convertible Securities. All issued and outstanding shares of the Company’s capital stock (i) have been duly authorized and validly issued, (ii) are fully paid and nonassessable, (iii) are free from any preemptive and cumulative voting rights and (iv) were issued pursuant to an effective registration statement filed with the Commission and applicable state securities authorities or pursuant to valid exemptions under federal and state securities laws. There are no outstanding rights of first refusal or voting or shareholder agreements of any kind relating to any of the Company’s securities to which the Company or any of its executive officers and directors is a party or as to which the Company otherwise has knowledge. When issued in compliance with the conversion provisions of the Notes, the Common Shares will be validly issued, fully paid and nonassessable, and will be free of any liens or encumbrances; provided, however, that the Common Shares may be subject to restrictions on transfer under state and/or federal securities laws as set forth herein or as otherwise required by such laws at the time a transfer is proposed. Notwithstanding the foregoing, the issuance of Common Shares in payment of interest or principal on the Notes pursuant to the provisions of Article 9 thereof is subject to further authorization of such issuance at the time by the Board of Directors or a committee thereof.

  2.4 Disclosures . Section 5.6 of the Note Purchase Agreement is amended to read in its entirety as follows:

  Section 5.6 Disclosures . This Agreement contains no untrue statement of a Material fact or omits to state any Material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made. Except as expressly described in Schedule 5.6, the SEC Reports, the Credit Agreement Schedules or in other documents delivered to the Purchasers, their attorneys or agents in connection

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• herewith, since April 30, 2006, there has been no change in the financial condition, operations, business or properties of the Company that is Material. There are no facts that (individually or in the aggregate) Materially and adversely affecting the Company that have not been set forth in the Transaction Documents or in other documents delivered to the Purchaser or its attorneys or agents in connection herewith.

  2.5 Nasdaq Compliance and Reporting Status . Each of Sections 5.21 and 5.22 of the Note Purchase Agreement are deleted in their entireties and "Reserved" inserted in lieu thereof.

  2.6 Financial Covenants . Section 7.6(a) of the Note Purchase Agreement is amended by amending subsections (i), (iv), (vii) and (xxii) thereof to read in their entireties as follows:

  (i) "Agent" means the Person serving as the lead administrative Lender under the Credit Agreement from time to time in effect (initially WB QT, LLC) and, in the absence of such a Person, the holder of the largest principal amount of outstanding Senior Indebtedness.

  (iv) "Bank Indebtedness" means any and all amounts payable under or in respect of the Credit Agreement and any Refinancing Indebtedness with respect thereto, as amended from time to time, including principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to Quantum or any subsidiary whether or not a claim for post-filing interest is allowed in such proceedings), fees, charges, expenses, reimbursement obligations, guarantees and all other amounts payable thereunder or in respect thereof. It is understood and agreed that Refinancing Indebtedness in respect of the Credit Agreement may be Incurred from time to time after termination of the Credit Agreement.

  (vii) "Credit Agreement" means the Credit Agreement dated as of January 31, 2007 among Quantum, the lenders named therein and WB QT, LLC, as agent for the lenders, including any collateral documents, instruments and agreements executed in connection therewith (and any "Loan Documents" as defined therein), and any amendments, supplements, modifications, extensions, renewals, restatements or refundings thereof (except to the extent that any such amendment, supplement, modification, extension, renewal, restatement or refunding would be prohibited by the terms of this Agreement, unless otherwise agreed to by the Purchasers or any other Note holder) and any indentures or credit facilities or commercial paper facilities with banks or other institutional lenders that replace, refund or refinance any part of the loans, notes, other credit facilities or commitments thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount borrowable thereunder or alters the maturity thereof.

  (xxii) "Senior Indebtedness" of Quantum and its subsidiaries means the principal of, premium (if any) and accrued and unpaid interest on (including interest accruing on or

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• after the filing of any petition in bankruptcy or for reorganization of Quantum or any subsidiary, regardless of whether or not a claim for post-filing interest is allowed in such proceedings) and fees and other amounts owing in respect of, Bank Indebtedness and all other Indebtedness of Quantum and its subsidiaries whether outstanding on the Closing Date or thereafter Incurred, if in the instrument creating or evidencing the same or pursuant to which the same is outstanding it is provided that such obligations are superior in right of payment to the Senior Subordinated Indebtedness; provided, however, that in any case, Senior Indebtedness shall not include (a) any obligation of Quantum or any subsidiary to another subsidiary of Quantum, (b) any liability for federal, state, local or other taxes owed or owing by Quantum or any subsidiary, (c) any accounts payable or other liability to trade creditors arising in the ordinary course of business (including Guarantees thereof or instruments evidencing such liabilities), (d) any Indebtedness or obligation of Quantum or a subsidiary (and any accrued and unpaid interest in respect thereof) that by its terms is subordinated or junior in right of payment to any other Indebtedness or obligation of Quantum or a subsidiary, including any Senior Subordinated Indebtedness, (e) any obligations with respect to any Capital Stock or (f) any obligations not secured by assets of Quantum or any subsidiary.

  Section 7.6(b) of the Note Purchase Agreement is amended to read in its entirety as follows:

  (b) Limitation on Senior Indebtedness and Senior Subordinated Indebtedness . Without the prior written permission of holders of a majority in outstanding principal amount of the Notes, the sum of the total Senior Indebtedness of Quantum and its subsidiaries shall not exceed $35,000,000 and the sum of the total Senior Indebtedness and Senior Subordinated Indebtedness (including the obligations under the Notes) of Quantum and its subsidiaries shall not exceed $60,000,000; provided, that this provision does not limit Indebtedness that may be incurred that is a Subordinated Obligation; provided further, that in the event the maturity of the Notes is extended pursuant to Article I hereof, this Section 7.6(b) shall no longer be in force and effect.

  Section 7.6(a), except clauses (i), (iv), (vii) and (xxii), of the Note Purchase Agreement is further amended by deleting all references to "the Company" as they appear therein and by substituting "Quantum or any subsidiary" in lieu thereof and by deleting all remaining references to "the Company" as they appear therein and by substituting "Quantum" in lieu thereof.

  2.7 Schedules . Schedule A to the Note Purchase Agreement is amended to read as Schedule A hereto with is made part of the Note Purchase Agreement as Schedule A thereto. All other Schedules to the Note Purchase Agreement shall be deemed updated as of the date hereof for all SEC Reports and the disclosures made in the Schedules to the Credit Agreement (the " Credit Agreement Schedules ").

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• 2.8 Form of Notes . Exhibit 1 to the Note Purchase Agreement is amended to read as Exhibit 1 hereto which is made part of the Note Purchase Agreement as Exhibit 1 thereto.

Section 3. Filings; Registration Rights Agreement . The Company acknowledges and agrees that it has assumed all obligations of Starcraft Corporation under the Registration Rights Agreement dated as of July 12, 2004 by and among Starcraft Corporation, Whitebox Convertible Arbitrage Partners L.P., Whitebox Hedged High Yield Partners L.P., Pandora Select Partners L.P., Whitebox Intermarket Partners L.P., and Whitebox Diversified Convertible Arbitrage Partners L.P. (the " Registration Rights Agreement "). The Company further acknowledges that all holders of any of the Notes after giving effect to the transactions contemplated by this Amendment and the Amended and Restated Notes shall be considered "Purchasers" under the Registration Rights Agreement and that the Company shall, to the extent required by the Registration Rights Agreement or applicable law and regulations, amend the Registration Statement filed with the Commission on August 31, 2004 (the " Registration Statement ") as needed by the transaction contemplated by this Amendment and the Amended and Restated Notes.

Section 4. Effectiveness of Amendments . The amendments contained in this Amendment shall become effective upon execution and delivery by the Company of the Amended and Restated Notes Convertible Subordinated Promissory Notes to each of the Purchasers in the form Exhibit 1 hereto.

Section 5. Representations, Warranties, Authority, No Adverse Claim .

• 5.1 Reassertion of Representations and Warranties, No Default . The Company hereby represents that on and as of the date hereof and after giving effect to this Amendment (a) except as set forth in any SEC Reports since the Closing Date, all of the representations and warranties contained in the Note Purchase Agreement are true, correct and complete in all material respects as of the date hereof as though made on and as of such date, except for changes permitted by the terms of the Note Purchase Agreement and except to the extent such representations and warranties specifically refer to a prior date in which case such representations and warranties shall have been true, correct and complete as of such prior date, and (b) there will exist no Event of Default under the Note Purchase Agreement as amended by this Amendment on such date which has not been waived by the Purchasers.

  5.2 Authority, No Conflict, No Consent Required . The Company represents and warrants that the Company has the power and legal right and authority to enter into the Amendment Documents and has duly authorized as appropriate the execution and delivery of the Amendment Documents and other agreements and documents executed and delivered by the Company in connection herewith or therewith by proper corporate action, and none of the Amendment Documents nor the agreements contained herein or therein contravenes or constitutes a default under any agreement, instrument or indenture to which the Company is a party or a signatory or a provision of the Company’s Articles

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• of Incorporation, Bylaws or any other agreement or requirement of law, or result in the imposition of any Lien on any of its property under any agreement binding on or applicable to the Company or any of its property except, if any, in favor of the Purchasers. The Company represents and warrants that no consent, approval or authorization of or registration or declaration with any person, including but not limited to any governmental authority, is required in connection with the execution and delivery by the Company of the Amendment Documents or other agreements and documents executed and delivered by the Company in connection therewith or the performance of obligations of the Company therein described, except for those which the Company has obtained or provided and as to which the Company has delivered certified copies of documents evidencing each such action to the Purchasers.

  5.3 No Adverse Claim . The Company warrants, acknowledges and agrees that no events have been taken place and no circumstances exist at the date hereof which would give the Company a basis to assert a defense, offset or counterclaim to any claim of the Purchasers with respect to the Company’s obligations under the Note Purchase Agreement as amended by this Amendment.

Section 6. Affirmation of Note Purchase Agreement, Further References . The Purchasers and the Company each acknowledge and affirm that the Note Purchase Agreement, as hereby amended, is hereby ratified and confirmed in all respects and all terms, conditions and provisions of the Note Purchase Agreement, except as amended by this Amendment, shall remain unmodified and in full force and effect. All references in any document or instrument to the Note Purchase Agreement are hereby amended and shall refer to the Note Purchase Agreement as amended by this Amendment.

Section 7. Merger and Integration, Superseding Effect . This Amendment, from and after the date hereof, embodies the entire agreement and understanding between the parties hereto and supersedes and has merged into this Amendment all prior oral and written agreements on the same subjects by and between the parties hereto with the effect that this Amendment, shall control with respect to the specific subjects hereof and thereof.

Section 8. Severability . Whenever possible, each provision of this Amendment and the other Amendment Documents and any other statement, instrument or transaction contemplated hereby or thereby or relating hereto or thereto shall be interpreted in such manner as to be effective, valid and enforceable under the applicable law of any jurisdiction, but, if any provision of this Amendment, the other Amendment Documents or any other statement, instrument or transaction contemplated hereby or thereby or relating hereto or thereto shall be held to be prohibited, invalid or unenforceable under the applicable law, such provision shall be ineffective in such jurisdiction only to the extent of such prohibition, invalidity or unenforceability, without invalidating or rendering unenforceable the remainder of such provision or the remaining provisions of this Amendment, the other Amendment Documents or any other statement, instrument or transaction contemplated hereby or thereby or relating hereto or thereto in such jurisdiction, or affecting the effectiveness, validity or enforceability of such provision in any other jurisdiction.

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Section 9. Successors . The Amendment Documents shall be binding upon the Company and the Purchasers and their respective successors and assigns, and shall inure to the benefit of the Company and the Purchasers and the successors and assigns of the Purchasers.

Section 10. Headings . The headings of various sections of this Amendment have been inserted for reference only and shall not be deemed to be a part of this Amendment.

Section 11. Counterparts . The Amendment Documents may be executed in several counterparts as deemed necessary or convenient, each of which, when so executed, shall be deemed an original, provided that all such counterparts shall be regarded as one and the same document, and either party to the Amendment Documents may execute any such agreement by executing a counterpart of such agreement.

Section 12. Governing Law . THE AMENDMENT DOCUMENTS SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO CONFLICT OF LAW PRINCIPLES THEREOF.

[Signatures Follow On Succeeding Pages]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the date and year first above written.

[Signature pages to First Amendment to Convertible Senior Subordinated Note Purchase Agreement]

S-1

[Signature pages to First Amendment to Convertible Senior Subordinated Note Purchase Agreement]

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SCHEDULE A TO

FIRST AMENDMENT TO CONVERTIBLE

SENIOR SUBORDINATED NOTE

PURCHASE AGREEMENT

SCHEDULE A

PURCHASERS

Schedule A-1

EXHIBIT 1 TO

FIRST AMENDMENT TO CONVERTIBLE

SENIOR SUBORDINATED NOTE

PURCHASE AGREEMENT

THE SECURITY REPRESENTED BY THIS INSTRUMENT WAS ORIGINALLY ISSUED ON JULY 12, 2004, AND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE TRANSFER OF THIS SECURITY IS SUBJECT TO THE CONDITIONS SPECIFIED IN THE CONVERTIBLE SENIOR SUBORDINATED NOTE PURCHASE AGREEMENT, DATED AS OF JULY 12, 2004, AS AMENDED AND MODIFIED FROM TIME TO TIME, BETWEEN TECSTAR AUTOMOTIVE GROUP, INC. (F/K/A STARCRAFT CORPORATION) (THE "COMPANY") AND THE PURCHASERS PARTY THERETO. THE COMPANY RESERVES THE RIGHT TO REFUSE THE TRANSFER OF SUCH SECURITY UNTIL SUCH CONDITIONS HAVE BEEN FULFILLED WITH RESPECT TO SUCH TRANSFER. UPON WRITTEN REQUEST, A COPY OF SUCH CONDITIONS SHALL BE FURNISHED BY THE COMPANY TO THE HOLDER HEREOF WITHOUT CHARGE.

THE INDEBTEDNESS EVIDENCED BY THIS NOTE IS SUBORDINATED TO THE COMPANY’S SENIOR INDEBTEDNESS AS MORE FULLY SET FORTH IN ARTICLE 4 HEREOF.

TECSTAR AUTOMOTIVE GROUP, INC.

AMENDED AND RESTATED CONVERTIBLE

SUBORDINATED PROMISSORY NOTE

TECSTAR AUTOMOTIVE GROUP, INC. (f/ka/ Starcraft Corporation), an Indiana corporation (the "Company"), hereby promises to pay to the order of [name/organization of purchaser] (the "Purchaser"), the principal amount of [principal amount] and 00/100 Dollars ($[principal amount]) plus the portion of the Accreted Principal Amount (as defined below) in excess thereof together with interest on the Accreted Principal Amount calculated from the date hereof in accordance with the provisions of this Note.

This Note was issued pursuant to a Convertible Senior Subordinated Note Purchase Agreement, dated as of July 12, 2004 (as amended by a First Amendment to Convertible Senior Subordinated Note Purchase Agreement dated as of January 31, 2007 and as further amended and modified from time to time, the "Purchase Agreement"), between the Company and the purchasers party thereto including the Purchaser, and this Note one of is one of the "Notes" referred to in the Purchase Agreement. This Note amends and restates an existing Convertible Subordinated Promissory Note dated as of July 12, 2004, in the original principal amount of $[                      ] issued by the Company to the Purchaser (the "Prior Note"). It is expressly intended,

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understood and agreed that this Note shall replace the Prior Note as evidence of such indebtedness of the Company to the Purchaser, and such indebtedness of the Company to the Purchaser heretofore represented by the Prior Note, as of the date hereof, shall be considered outstanding hereunder from and after the date hereof and shall not be considered paid (nor shall the undersigned’s obligation to pay the same be considered discharged or satisfied) as a result of the issuance of this Note. The Purchase Agreement contains terms governing the rights of the holder of this Note, and all provisions of the Purchase Agreement are hereby incorporated herein in full by reference. Unless otherwise indicated herein, capitalized terms used in this Note have the same meanings set forth in the Purchase Agreement.

ARTICLE I

PAYMENT OF INTEREST; CONTINGENT INTEREST

Interest shall accrue on the Accreted Principal Amount at an annual rate equal to 11.50% (or, from and after any extension of the maturity date of this Note under Section 2.1 below, 9.50%) per annum, of which amount (a) 6.50% shall be payable in cash on each Interest Payment Date and (b) 5.0% (or, from and after any extension of the maturity date of this Note under Section 2.1 below, 3.0%) shall be payable by adding such interest to the Accreted Principal Amount on each Interest Payment Date (as defined below), and on the final maturity hereof (the "PIK Amount"). At any time, the outstanding principal amount of this Note, including all PIK Amounts and Default PIK Amounts (as defined below) added thereto through such time, is referred to in this Note as the "Accreted Principal Amount" (in each case computed on the basis of a 365/366-day year and the actual number of days elapsed in any year) on the unpaid principal amount of this Note outstanding from time to time, or (if less) at the highest rate then permitted under applicable law. The Company shall pay to the holder of this Note all accrued interest (including Contingent Additional Interest as described below) on the first day of each July and January (each, an "Interest Payment Date" ) and on the final maturity date of this Note. Any accrued cash interest which for any reason has not theretofore been paid shall increase the principal of the Note and be paid in full on the date on which the final principal payment on this Note is made (the "Default PIK Amounts"); provided that any such reason shall not affect or waive any Event of Default that arises due to the failure to make such payment in cash. Interest shall accrue on any principal payment due under this Note (including as to accrued interest added to the principal) until such time as payment therefore is actually delivered to the holder of this Note.

In the event that the Company fails by September 10, 2004 (the "Filing Deadline") to file the Registration Statement with the Commission, or fails by January 8, 2005 (the "Registration Deadline") to obtain effectiveness under the Securities Act and applicable state securities laws of the Registration Statement (as required by the terms of a Registration Rights Agreement between the Company and Purchaser of this date) registering all of the shares of Common Shares issuable as payment under or upon conversion of this Note as provided therein, then for each full month thereafter (prorated for partial months) that this failure continues (the "Failure Term"), and to the extent permitted by law, the Company shall pay in arrears in cash, with the next otherwise scheduled payment of interest pursuant to the above paragraph (or if the last scheduled interest payment has been made, then monthly on the same day of each succeeding month), additional

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interest (the "Contingent Additional Interest") equal to the greater of $5,000 or 0.5% of the outstanding principal balance on this Note as of the last day of the prior month. However, if the Failure Term runs for more than three months, the additional monthly cash interest payable thereafter shall increase, to the extent permitted by law, to the greater of $10,000 or 1% of the outstanding principal balance on this Note as of the last day of the prior month.

ARTICLE II

PAYMENT OF PRINCIPAL ON NOTE

Section 2.1 Scheduled Payment . The Company shall pay the Accreted Principal Amount or, if less, the outstanding principal amount of this Note to the holder of this Note on July 1, 2009, together with all accrued and unpaid interest on the principal amount being repaid At the election of the Purchasers in their sole discretion and upon written notice to the Company no later than May 15, 2009, such maturity date shall be extended until July 1, 2012.

Section 2.2 Conversion . Notwithstanding any provision contained in this Article 2, the holder of this Note may convert all or any portion of the outstanding principal amount of this Note into shares of common stock, without par value, of the Company (the "Common Shares") in accordance with Article 6 until such time as such principal amount has been paid.

ARTICLE III

PRO RATA PAYMENT

Except as otherwise expressly provided in this Note, all payments to the holders of the Note (whether for principal, interest or otherwise) shall be made pro rata among such holders based upon the aggregate unpaid principal amount of the Note held by each such holder. If any holder of the Note obtains any payment (whether voluntary, involuntary, or otherwise) of principal, interest or other amount with respect to the Note in excess of the holder’s pro rata share of such payments obtained by all holders of the Notes (other than as expressly provided herein), then the holder, by acceptance of the Note, agrees to purchase from the other holders of the Note a participation in the Note held by them as is necessary to cause the other holders to share the excess payment ratably among each of them as provided in this paragraph.

ARTICLE IV

SUBORDINATION

Section 4.1 Debt Subordination . The indebtedness evidenced by the Note is subordinate and junior to any and all Indebtedness constituting Senior Indebtedness within the meaning of the Purchase Agreement ("Senior Indebtedness"). The Note is subordinate to Senior Indebtedness only to the extent and in the manner hereinafter set forth.

• (a) During the continuance of any Company Default and so long as any Company Default remains which has not been cured or waived by the holder of the Senior Indebtedness under which the Company Default arises, no payment of principal or interest shall be made on the Note, unless (and, if applicable, to the extent permitted by clause 4.1(b)(i), below) such payment is made in kind in the form of Common Shares as

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• provided in Article 6 or Article 9; provided , that the Company may pay and the holder(s) of the Note may accept scheduled payments of interest upon the Note so long as (i) no Insolvency Proceeding has occurred, (ii) no Company Default that is a default in the payment of any principal, interest or any other amount on the Senior Indebtedness has occurred (each, a "Payment Default"), and (iiii)(A) the holder(s) of the Note have not received a written notice (a "Senior Non-Payment Default Notice") that a Company Default (other than a Payment Default) has occurred and is continuing or will occur as a result of or immediately following such payment, (B) each such Company Default has not been waived or cured in accordance with the terms of the Senior Documents, and (C) 180 days have not elapsed (each such 180 day period shall be referred to herein as a "Blockage Period") since the date the Senior Non-Payment Default Notice was received. Notwithstanding any provision in this Section 4.1(a) to the contrary (x) the Company shall not be prohibited from making, and the holder(s) of the Note shall not be prohibited from receiving, payments of interest upon the Note under clause (iii) of the preceding sentence for more than aggregate of 180 days within any period of 365 consecutive days; (y) no Company Default existing on the date any Senior Non-Payment Default Notice is given pursuant to this Section 4.1(a) shall, unless the same shall have ceased to exist for a period of at least 30 consecutive days, be used as the basis for any subsequent such notice; and (z) the failure of the Company to make any payment with respect to the Note by reason of the operation of this Section 4.1(a) shall not be construed as preventing the occurrence of a default under any loan agreement, credit agreement, security agreement, letter of credit, reimbursement agreement or other document or instrument evidencing or securing the Note.

  (b) If any cash payment is made on the Note at a time when the holders are not entitled to receive cash payments on the Note, the payment or distribution shall be delivered directly to the Agent for application against the Senior Indebtedness, unless and until all principal and interest on the Senior Indebtedness has been paid in full and the commitments, if any, of the holders of the Senior Indebtedness to extend credit accommodations to Quantum or the Company have expired, except that

no such delivery shall be made of stock or obligations issued by the Company or any corporation succeeding to the Company or acquiring its property and assets, pursuant to reorganization proceedings or dissolution or liquidation proceedings or upon any merger, consolidation, sale, lease, transfer or other disposal, if such stock or obligations are subordinate and junior at least to the extent provided hereunder to the payment of Senior Indebtedness to the extent then outstanding and to the payment of any stock or obligations which are concurrently therewith issued in exchange for Senior Indebtedness to the extent then outstanding, and

if any holder of Senior Indebtedness receives any payment or distribution that, except for the provisions of this Section 4.1, would have been payable or deliverable with respect to the Note, the holders of the Note shall (after all principal and interest owing on such Senior Indebtedness has been paid in full and the commitments, if any, of the holders of the Senior Indebtedness to extend credit accommodations to Quantum or the Company have expired) be subrogated to the rights of such holders of such Senior Indebtedness against the Company.

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• (c) Until all Senior Indebtedness has been paid in full and the commitments, if any, of the holders of the Senior Indebtedness to extend credit accommodations to Quantum or the Company have expired, the holders of the Note shall not, without the prior written consent of the Agent, take any Enforcement Action with respect to the Notes or any Collateral, until the earlier to occur of the following and in any event no earlier than ten (10) days after the Agent’s receipt of written notice from such holder of the Note of its intention to take such Enforcement Action (which notice may be issued during the 180 day period referred to in clause (iii) below with respect to an Enforcement Action that such holder of the Note has the right to commence upon the expiration of said 180 day period):

  • • (i) acceleration of the Senior Indebtedness;

      (ii) the occurrence of an Insolvency Proceeding with respect to the Company; or

      (iii) the passage of 180 days from the delivery by the holder of a Note to the Agent of notice of an event of default under the Subordinated Documents if any default described therein shall not have been cured or waived within such period.

Notwithstanding the foregoing, but subject in all events to the provisions of Section 4.4, any holder of the Note may file proofs of claim against the Company in any Insolvency Proceeding involving the Company. Except for distributions of the type specified in Section 4(b)(i), any distributions or other proceeds of any Enforcement Action obtained by any holder of the Note shall in any event be held in trust by it for the benefit of the holders of the Senior Indebtedness and promptly paid or delivered to the Agent in the form received until all Senior Indebtedness has been paid in full and the commitments, if any, of the holders of the Senior Indebtedness to extend credit accommodations to Quantum or the Company have expired. Notwithstanding anything contained herein to the contrary, if following the acceleration of the Senior Indebtedness, such acceleration is rescinded (whether or not any existing Company Default has been cured or waived), then all Enforcement Actions taken by any holder of the Note shall likewise be rescinded if such Enforcement Action is based solely on clause (i) of this Section 4.1(c). Notwithstanding anything herein to the contrary, no provision herein shall prevent any holder of the Note from initiating a legal action or proceeding solely to the extent necessary to prevent the running of any applicable statute of limitation or similar restriction on claims.

• (d) Each holder of the Note waives notice of the creation of the Senior Indebtedness and notice of acceptance by the holder(s) of Senior Indebtedness of the subordination and other provisions set forth herein. The holder of the Note agrees that, so long as the Credit Agreement remains in effect, the subordination provisions of the Note and the Purchase Agreement may not be modified or amended without the prior written consent of the Agent and that any amendment or modification entered into without such consent shall be null and void and that it will not agree to:

  • • (i) any amendment of the Note or the Purchase Agreement that would shorten the due dates of any principal or interest payments upon the Note;

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• • • (ii) any amendment of the covenants, events of default or other material provisions of the Note or the Purchase Agreement to make them more restrictive for or burdensome on the Company (except for financial covenants which the holder(s) of the Note may amend to the extent that holders of the Bank Indebtedness have amended the corresponding financial covenants in the Credit Agreement);

      (iii) any amendment increasing the interest rate payable with respect to the Note to an interest rate that is 200 basis points more than the interest rate applicable to the Note on the date of issuance of the Note, except in connection with the imposition of a default rate of interest in accordance with the terms of the Note or the Purchase Agreement as they are in effect on the date hereof.

  (e) Each holder of the Note agrees that each holder of Senior Indebtedness may, at any time and from time to time hereafter without the consent of or notice to any holder of the Note, change the manner or time of payment or renew or alter any of the terms of