PROMISSORY NOTE

FOR VALUE RECEIVED , MAGNETECH INDUSTRIAL SERVICES, INC., an Indiana corporation (“Magnetech”) promises to pay to the order of JOHN A MARTELL (“Lender”) the principal sum of Three Million Dollars ($3,000,000), with interest thereon at 1% below the Prime Rate, payable at 1125 South Walnut Street, South Bend, Indiana 46619, or such other place as Lender may designate in writing from time to time hereafter. For purposes of this Promissory Note, “Prime Rate” shall mean the Prime Rate as published in The Wall Street Journa l, and which is described as the base rate on corporate loans at large U.S. money center commercial banks. The Prime Rate will be adjusted on the first business day of each month during the period this Note is outstanding.

Interest only on the outstanding principal balance of the Note shall be due and payable commencing on February 1, 2004 and continuing on the 1 ^st day of each month thereafter until December 31, 2008, when all principal and accrued interest under this Note shall be due and payable in one lump sum amount; provided, that Magnetech, upon at least 60 days prior written notice to Lender (which notice may not be sent by Magnetech prior to July 1, 2008), may extend the term of this Note for an additional period of sixty (60) months (the “Extended Term”).

In the event the term of this Note is extended by Magnetech, interest only on the outstanding principal balance shall be due and payable to Lender on January 1, 2009. Thereafter, equal monthly principal installments of Fifty Thousand Dollars ($50,000) and all accrued interest on the outstanding principal balance shall be due and payable commencing on February 1,   2009 and continuing on the 1 ^st day of each month thereafter until December 31, 2013, when all remaining principal and accrued interest under this Note shall be due and payable in one lump sum amount. Notwithstanding anything in this Note to the contrary, the interest rate payable on the outstanding principal balance of the Note during the Extended Term shall be the Prime Rate, plus 1%. The Prime Rate will continue to be adj