EMBRESCIA GUARANTY
Exhibit
10.9
EMBRESCIA
GUARANTY
This
Continuing Guaranty of Payment (“Guaranty”) is made and delivered this 30th day
of November, 2007, by Xxxxxx X. Xxxxxxxxx (“Xxxxxxxxx”).
RECITALS:
A. 3-D
Service, Ltd. (“3-D”) has been engaged in the business of selling, repairing,
remanufacturing and maintaining industrial electrical and mechanical equipment
from its locations at 000 Xxxx Xxxx XX in Massillon, Ohio, and at 000
Xxxxxxxxxxxxx Xxxx in Cincinnati, Ohio.
X. Xxxxxxxxx
has been the Chairman of Board of 3-D since its inception. Through
XGen III, Ltd., an Ohio limited liability company owned 90% by XGEN Ltd. and
10%
by Venture Equity & Derivative Investment, LLC (“XGen”), Embrescia has also
had an ownership or beneficial interest in 3-D since its inception.
C. Pursuant
to the 3-D Membership Interest Purchase Agreement (the “Membership Interest
Purchase Agreement”), executed on November 30, 2007, Magnetech Industrial
Services, Inc. (“Magnetech”) has purchased all of the Membership Interest Units
of 3-D, including all Units owned by XGen III, Ltd.
D. Magnetech
would not have been willing to enter into the Membership Interest Purchase
Agreement without the agreement of Embrescia to execute this Guaranty, along
with the execution of a similar agreement by Xxxxxxx X. XxXxxx
(“XxXxxx”).
E. The
consummation by Magnetech of the transactions contemplated by the Membership
Interest Purchase Agreement is in reliance upon the assurance of Embrescia
that
he will comply fully with all of the terms and conditions of this
Guaranty.
NOW,
THEREFORE, in consideration of the payments, promises and other benefits made
to
or conveyed to Embrescia, directly or indirectly, through the Membership
Interest Purchase Agreement, and as an inducement to Magnetech to enter into
the
Membership Interest Purchase Agreement, Embrescia hereby agrees as
follows:
Embrescia
hereby promises and guarantees to Magnetech that upon failure of XGen III,
Ltd.,
to promptly and fully pay any and all Indebtedness (as defined below),
Embrescia, subject to the limitations of the Cap, hereinafter defined, shall
pay
all Indebtedness to Magnetech on demand together with all expenses of enforcing
this Guaranty, including attorneys’ fees, expenses and all other costs of
collection under this Guaranty. This Guaranty constitutes and is an
absolute, unconditional and continuing guarantee of payment and shall apply
to
each and every default in payment by XGen III, Ltd., which gives rise to
Indebtedness. Subject to the limits of the Cap, it is understood that repeated
and successive demands may be made and recoveries had hereunder.
In
this
Guaranty, “Indebtedness” means all indebtedness and obligations of XGen III,
Ltd., now or hereafter owing to Magnetech under Section 8.02 of the Membership
Interest Purchase Agreement, whether such indebtedness or obligations be direct
or indirect, absolute or contingent, or primary or secondary.
The
aggregate amount of Embrescia’ guaranty obligations for any and all Indebtedness
shall not exceed One Million Five Hundred Thousand Dollars ($1,500,000.00)
(the
“Cap”), provided that the Cap shall not apply to any Indebtedness
related to any willful or fraudulent breach by XGen III, Ltd., of the Membership
Interest Purchase Agreement or any document, instrument or agreement ancillary
to the Membership Interest Purchase Agreement.
The
liability of Embrescia hereunder shall be discharged and this Guaranty shall
terminate 120 days after payment in full of the Indebtedness if within such
120-day period no petition is filed by or against XGen III, Ltd., pursuant
to
the United States Bankruptcy Code, as amended from time to time, or under any
similar law of any jurisdiction. If such a petition is filed within
said 120-day period, this Guaranty shall continue and shall remain in full
force
and effect until such time as the Indebtedness has been paid in full and is
no
longer subject to repayment by, or recovery from, Magnetech under any such
law.
Magnetech
may take new, additional or substitute security for the Indebtedness without
releasing or impairing the obligation of Embrescia to Magnetech hereunder,
which
security may be taken without notice to Embrescia. The liability of
Embrescia hereunder shall not be affected or impaired by any irregularity in
or
amendment of the Membership Interest Purchase Agreement or any documents or
instruments executed in connection therewith. Embrescia agrees that
this instrument shall be binding on his heirs, personal representatives,
successors and assigns to the extent that such persons receive any portion
of
the proceeds Embrescia receives, directly or indirectly, from the Membership
Interest Purchase Agreement, and that the rights and benefits of this Guaranty
shall inure to the benefit of the successors and assigns of
Magnetech.
Magnetech
shall have the right to apply all amounts received hereunder, in such amounts
and in such proportions as Magnetech in its sole discretion shall determine,
to
the costs and expenses of enforcement and collection under this Guaranty and
to
the full or partial satisfaction of the Indebtedness. Demand for
payment under this Guaranty shall be effective upon Magnetech placing notice
in
the United States mail addressed to Embrescia at the addresses stated below
by
first class, registered, or certified mail.
This
Guaranty shall be interpreted, construed and governed by the laws of the State
of Ohio, without regard to conflicts of law principles. The parties
expressly consent to exclusive personal jurisdiction and venue in the federal
and state courts of the State of Ohio. Wherever possible, each provision
of this Guaranty shall be interpreted in such manner as to be effective and
valid under applicable law, and any provision of this Guaranty prohibited or
unenforceable under applicable law shall be ineffective only to the extent
of
such prohibition or unenforceability without invalidating the remaining
provisions of this Guaranty.
So
Agreed
and signed this 30th day of November, 2007.
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Xxxxxx
X. Xxxxxxxxx
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| /s/ Xxxxxx X. Xxxxxxxxx | |
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Xxxxxx
X. Xxxxxxxxx
0000
Xxxxxxxx Xxx
Xxxxxxxxx Xxxx 00000
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Before
me, the undersigned, a Notary
Public in and for said County and State, personally appeared Xxxxxx X.
Xxxxxxxxx, who acknowledged the execution of the foregoing Instrument on
the
date of its execution set forth above.
WITNESS
my hand and Seal this 29th day of November, 2007.
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My
Commission Expires:
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/s/ Xxx X. Xxxx |
,
Notary Public
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| November 9, 2008 | ||||
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[SEAL]
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Resident
of Cuyahoga County, Ohio
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