CREDIT AGREEMENT



            THIS CREDIT AGREEMENT (such agreement, as amended or otherwise

modified from time to time, being hereinafter referred to as this "Agreement"),

dated as of January 3, 2005, is between EDAC TECHNOLOGIES CORPORATION, a

Wisconsin corporation, GROS-ITE, INDUSTRIES, INC., a Connecticut corporation,

and APEX MACHINE TOOL COMPANY, INC., a Connecticut corporation (individually and

collectively referred to herein as "Borrower"), each with its principal office

at 1806 New Britain Avenue, Farmington, Connecticut 06032 and BANKNORTH, N.A., a

national bank having a mailing address at 102 West Main Street, New Britain,

Connecticut 06050-0174 ("Lender").



                                   Background



            Lender is willing, subject to the terms and conditions set forth in

this Agreement, to make available to Borrower (i) a Term Loan in the amount of

$5,000,000 to fund the refinancing of certain financing facilities currently

held by Borrower, (ii) a Revolving Credit Loan in an amount not to exceed

$5,000,000, to finance Borrower's general working capital needs, and (iii) an

interim Equipment Loan in the amount of $1,500,000 (initially in the form of a

line of credit and then converting into a term loan), to finance the acquisition

of certain Eligible Equipment. The credit facilities to be made available by

Lender to Borrower will be evidenced by the Loan Documents and secured by the

Security Documents. The funding of the Term Loan and the commencement of funding

the Revolving Credit Loan and the Equipment Loan shall occur on January 3, 2005

(the "Effective Date").



            NOW, THEREFORE, in consideration of the terms and conditions set

forth herein, and of any loans, advances, guarantees, or extensions of credit

heretofore, now or hereafter made to or for the benefit of Borrower by Lender,

and intending to be legally bound hereby, the parties hereto agree as follows:



                                    ARTICLE I

                               THE CREDIT FACILITY



      SECTION 1.1 Revolving Credit and Term Loans.



                  1.1.1 Revolving Credit Loans.



                  (a) Subject to the terms and conditions hereof and in reliance

on the representations and warranties contained in this Agreement, Lender agrees

to make Revolving Credit Loans to Borrower commencing on the Effective Date and

continuing at any time or from time to time on or prior to the Revolving Credit

Loan Maturity Date in an aggregate principal amount at any one time outstanding

not exceeding the Revolving Credit Commitment. Subject to these limitations,

Borrower may borrow, repay and re-borrow funds from Lender pursuant to the

provisions of this Section and Section 1.1.5(b).



                  (b) Borrower's obligation to repay the Revolving Credit Loans

with interest in accordance with the terms of this Agreement shall be evidenced

by a single Revolving Credit Note substantially in the form of Exhibit A

attached hereto. The Revolving Credit Note



{PAGE}



shall be dated as of the date of this Agreement, shall mature and become due and

payable in accordance with the terms of this Agreement and shall bear interest

as set forth in Section 1.1.4. All Revolving Credit Loans made to Borrower by

Lender shall be recorded by Lender, and all payments made on account of the

Revolving Credit Loans shall be similarly recorded. Any failure of Lender to

record a transaction in a timely fashion, or any error in recording shall not

affect or impair the validity of any Obligation.



                  1.1.2 Term Loan.



                  (a) Subject to the terms and conditions hereof and in reliance

on the representations and warranties contained in this Agreement, Lender agrees

to make the Term Loan to Borrower on the Effective Date in an aggregate

principal amount equal to $5,000,000. The outstanding principal amount of the

Term Loan shall be paid in equal monthly installments of $97,559.81 allocate

between principal and interest as set forth on Schedule I attached hereto.

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