REIMBURSEMENT AGREEMENT

Reimbursement Agreement, dated as of March 1, 2007, is made by AEROSPACE INTEGRATION CORPORATION, a Florida corporation (Borrower), having its principal office in Mary Esther, Florida, in favor of NATIONAL CITY BANK, a national banking association, having its principal office at Cleveland, Ohio (the Bank).

WHEREAS, Borrower requested that The Industrial Development Board of the City of Albertville, Alabama (the Issuer) finance manufacturing facilities for it through the provisions of a lease to Borrower, pursuant to the terms of a Lease Agreement dated as of March 1, 2007 (the Lease Agreement), between Borrower and the Issuer; and

WHEREAS, the Issuer has agreed to provide such facilities to Borrower and to obtain the funds required for the manufacturing facilities (the Project) and lease by issuing its Variable Rate Industrial Development Revenue Bonds, Series 2007 (Aerospace Integration Corporation Project) in the principal amount of $10,000,000 (the Project Bonds), pursuant to the provisions of a Trust Indenture dated as of March 1, 2007 (the Indenture), from the Issuer to Branch Banking & Trust Company, as trustee (the Trustee); and

WHEREAS, upon the issuance of the Project Bonds, such Bonds will be sold under a Bond Purchase Agreement dated as of March 1, 2007 (the Purchase Agreement), among the Issuer, Borrower, and NatCity Investments, Inc., as the underwriter (the Underwriter); and

WHEREAS, Borrower and NatCity Investments, Inc. (the Remarketing Agent) are entering into a certain Remarketing Agreement dated as of March 1, 2007 (the Remarketing Agreement), pursuant to which the Remarketing Agent has agreed to act as Remarketing Agent in respect to the Project Bonds; and

WHEREAS, under the Indenture, the Issuer has assigned to the Trustee certain of the Issuers rights under the Lease Agreement together with the right to receive payments thereunder; and

WHEREAS, Borrower has requested the Bank to issue an irrevocable letter of credit in favor of the Trustee, in the form of Annex 1 hereto (the Letter of Credit) in an amount not exceeding Ten Million Two Hundred Seventy One Thousand Two Hundred Thirty Three and 00/100 Dollars ($10,271,233), (the Letter of Credit Commitment), which Letter of Credit is being issued pursuant to this Agreement; and

WHEREAS, to secure Borrowers obligations to the Bank under this Agreement (a) the Issuer and Borrower will grant a leasehold mortgage on the Borrowers leasehold interest in the Project pursuant to a Leasehold Mortgage, Security Agreement and Assignment of Lease dated as of March 1, 2007 (the Mortgage), (b) Borrower will grant a security interest in its personal property pursuant to a Security Agreement dated as of March 1, 2007 (the Borrower Security Agreement), (c) Borrower will cause MTC Technologies, Inc., an Ohio corporation (the Guarantor), to guarantee Borrowers obligations hereunder pursuant to a Guaranty dated as of March 1, 2007 (the Guaranty), which Guaranty shall be secured by a lien on the personal property of the Guarantor pursuant to a Security Agreement dated as of March 1, 2007 (the

Annex 2 - 1

Guarantor Security Agreement), and (d) Borrower will indemnify the Bank, the Issuer and the Trustee for environmental liabilities arising from the Project pursuant to an Environmental Compliance and Indemnification Agreement dated as of March 1, 2007 (the Environmental Indemnity).

NOW, THEREFORE, in consideration of the premises and in order to induce the Bank to issue the Letter of Credit, Borrower and the Bank hereby agree as follows:

SECTION 1. Definitions. In addition to the terms heretofore defined, the following terms shall have the meanings provided below.

Agreement means this Reimbursement Agreement, as the same may be amended and/or restated from time to time.

Bank Group means the Banks as that term is defined in the Credit Agreement.

Banks Interest Rate means, with respect to any unreimbursed B Drawing until the date of reimbursement, a rate of interest equal to the Banks Prime Rate, changing when and as the Prime Rate changes, computed on the amounts of unreimbursed B Drawings from time to time outstanding, calculated on the basis of a 360-day year and on actual days elapsed.

Bond Legislation means the resolutions/ordinances enacted by the Issuer authorizing the issuance of the Project Bonds.

Bond Pledge Agreement shall mean that certain agreement, dated as of March 1, 2007, among the Bank, Borrower and the Trustee, pursuant to which Borrower has pledged to the Bank, Drawing Project Bonds which the Trustee will hold for the benefit of the Bank.

Business Day means any day other than a Saturday or Sunday or holiday, or other day on which banks located in the city or cities in which the corporate trust office of the Trustee responsible for administration of the Indenture, the principal office of the Remarketing Agent or the principal office of the Bank are located and authorized or required to close for general banking business or on which The New York Stock Exchange is closed.

Commitment Fee means the fee payable by Borrower pursuant to Section 2(a) hereof.

Credit Agreement means the Credit and Security Agreement made effective as of April 21, 2005, among MTC Technologies, Inc., a Delaware corporation, the Guarantor, the Bank Group, National City Bank, as lead arranger and administrative agent for the Bank Group, Branch Banking and Trust Company, as syndication agent, Keybank National Association, as co-documentation agent, and Fifth Third Bank, as co-documentation agent, as amended and as the same may be further amended and/or restated from time to time.

Date of Issuance means the date of issuance of the Letter of Credit.

Drawing means any A Drawing, B Drawing or C Drawing.

A Drawing means a drawing made by sight draft accompanied by a certificate in the form of Exhibit A to Annex 1 hereto to pay the interest payments due on the Project Bonds.

B Drawing means a drawing made by a sight draft accompanied by a certificate in the form of Exhibit B to Annex 1 hereto to pay a portion of the purchase price of the Project Bonds corresponding to the principal amounts of the Project Bonds being purchased pursuant to a demand tender or a mandatory tender by a holder of the Project Bonds pursuant to the Indenture, provided, however, that Project Bonds tendered by a holder, which Project Bonds shall also be redeemed by the Trustee as part of any redemption, shall not be subject to a B Drawing and shall not become Drawing Project Bonds.

C Drawing means a drawing made by sight draft accompanied by a certificate in the form of Exhibit C to Annex 1 hereto to pay the portion of the redemption price of Project Bonds corresponding to the principal amount of such Project Bonds redeemed by the Issuer pursuant to the Indenture and delivered to the Trustee for cancellation, or to pay the principal portion of the Project Bonds at their stated maturities or upon acceleration of payments due on such Project Bonds pursuant to the Indenture.

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