EXHIBIT 10.3

                       GUARANTEE AND POSTPONEMENT OF CLAIM


TO: ROYAL BANK OF CANADA

      FOR VALUABLE CONSIDERATION, receipt whereof is hereby acknowledged, the
undersigned and each of them (if more than one) hereby jointly and severally
guarantee(s) payment on demand to ROYAL BANK OF CANADA (hereinafter called the
"Bank") of all debts and liabilities, present or future, direct or indirect,
absolute or contingent, matured or not, at any time owing by PNEUTECH INC.,
ROUSSEAU CONTROLS INC. AND/OR HYDRAMEN FLUID POER LIMITED. (hereinafter called
the "customer") to the Bank or remaining unpaid by the customer to the Bank,
heretofore or hereafter incurred or arising and whether incurred by or arising
from agreement or dealings between the Bank and the customer or by or from any
agreement or dealings with any third party by which the Bank may be or become in
any manner whatsoever a creditor of the customer or however otherwise incurred
or arising anywhere within or outside the country where this guarantee is
executed and whether the customer be bound alone or with another or others and
whether as principal or surety (such debts and liabilities being hereinafter
called the "liabilities"); the liability of the undersigned hereunder being
limited to the principal sum of FIFTEEN MILLION DOLLARS ($15,000,000.00),
together with interest thereon from the date of demand for payment at a rate
equal to THE BANK'S PRIME INTEREST RATE PER ANNUM IN EFFECT FROM TIME TO TIME
PLUS FIVE (5%) percent per annum, as well after as before default and judgment.

AND THE UNDERSIGNED AND EACH OF THEM (IF MORE THAN ONE) HEREBY JOINTLY AND
SEVERALLY AGREE(S) WITH THE BANK AS FOLLOWS:

(1) The Bank may grant time, renewals, extensions, indulgences, releases and
discharges to, take securities (which word as used herein includes securities
taken by the Bank from the Customer and others, monies which the Customer has on
deposit with the Bank, other assets of the Customer held by the Bank in
safekeeping or otherwise, and other guarantees) from and give the same and any
or all existing securities up to, abstain from taking securities from, or
perfecting securities of, cease or refrain from giving credit or making loans or
advances to, or change any term or condition applicable to the liabilities,
including without limitation, the rate of interest or maturity date, if any, or
introduce new terms and conditions with regard to the liabilities, or accept
compositions from and otherwise deal with, the customer and others and with all
securities as the Bank may see fit, and may apply all moneys at any time
received from the customer or others or from securities upon such part of the
liabilities as the Bank deems best and change any such application in whole or
in part from time to time as the Bank may see fit, the whole without in any way
limiting or lessening the liability of the undersigned under this guarantee, and
no loss of or in respect of any securities received by the Bank from the
customer or others, whether occasioned by the fault of the Bank or otherwise,
shall in any way limit or lessen the liability of the undersigned under this
guarantee.

(2) This guarantee shall be a continuing guarantee and shall cover all the
liabilities, and it shall apply to and secure any ultimate balance due or
remaining unpaid to the Bank.

(3) The Bank shall not be bound to exhaust its recourse against the customer or
others or any securities it may at any time hold before being entitled to
payment from the undersigned of the liabilities. The undersigned renounce(s) to
all benefits of discussion and division.

(4) The undersigned or any of them may, by notice in writing delivered to the
Manager of the branch or agency of the Bank receiving this instrument, with
effect from and after the date that is 30 days following the date of receipt by
the Bank of such notice, determine their or his/her liability under this
guarantee in respect of liabilities thereafter incurred or arising but not in
respect of any liabilities theretofore incurred or arising even though not then
matured, provided, however, that notwithstanding receipt of any such notice the
Bank may fulfil any requirements of the customer based on agreements express or
implied made prior to the receipt of such notice and any resulting liabilities
shall be covered by this guarantee; and provided further that in the event of
the determination of this guarantee as to one or more of the undersigned it
shall remain a continuing guarantee as to the other or others of the
undersigned.


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(5) All indebtedness and liability, present and future, of the customer to the
undersigned or any of them are hereby assigned to the Bank and postponed to the
liabilities, and all moneys received by the undersigned or any of them in
respect thereof shall be received in trust for the Bank and forthwith upon
receipt shall be paid over to the Bank, the whole without in any way limiting or
lessening the liability of the undersigned under the foregoing guarantee; and
this assignment and postponement is independent of the said guarantee and shall
remain in full effect notwithstanding that the liability of the undersigned or
any of them under the said guarantee may be extinct. The term "Liabilities", as
previously defined, for purposes of the postponement feature provided by this
agreement, and this section in particular, includes any funds advanced or held
at the disposal of the customer under any line(s) of credit.

(6) This guarantee and agreement shall not be affected by the death or loss or
diminution of capacity of the undersigned or any of them or by any change in the
name of the customer or in the membership of the customer's firm through the
death or retirement of one or more partners or the introduction of one or more
other partners or otherwise, or by the acquisition of the customer's business by
a corporation, or by any change whatsoever in the objects, capital structure or
constitution of the customer, or by the customer's business being amalgamated
with a corporation, but shall notwithstanding the happening of any such event
continue to apply to all the liabilities whether theretofore or thereafter
incurred or arising and in this instrument the word "customer" shall include
every such firm and corporation.

(7) This guarantee shall not be considered as wholly or partially satisfied by
the payment or liquidation at any time or times of any sum or sums of money for
the time being due or remaining unpaid to the Bank, and all dividends,
compositions, proceeds of security valued and payments received by the Bank from
the customer or from others or from estates shall be regarded for all purposes
as payments in gross without any right on the part of the undersigned to claim
in reduction of the liability under this guarantee the benefit of any such
dividends, compositions, proceeds or payments or any securities held by the Bank
or proceeds thereof, and the undersigned shall have no right to be subrogated in
any rights of the Bank until the Bank shall have received payment in full of the
liabilities.

(8) All monies, advances, renewals, credits and credit facilities in fact
borrowed or obtained from the Bank shall be deemed to form part of the
liabilities, notwithstanding any lack or limitation of status or of power,
incapacity or disability of the customer or of the directors, partners or agents
of the customer, or that the customer may not be a legal or suable entity, or
any irregularity, defect or informality in the borrowing or obtaining of such
monies, advances, renewals, credits or credit facilities, or any other reason,
similar or not, the whole whether known to the Bank or not. Any sum which may
not be recoverable from the undersigned on the footing of a guarantee, whether
for the reasons set out in the previous sentence, or for any other reason,
similar or not, shall be recoverable from the undersigned and each of them as
sole or principal debtor in respect of that sum, and shall be paid to the Bank
on demand with interest and accessories.

(9) This guarantee is in addition to and not in substitution for any other
guarantee, by whomsoever given, at any time held by the Bank, and any present or
future obligation to the Bank incurred or arising otherwise than under a
guarantee, of the undersigned or any of them or of any other obligant, whether
bound with or apart from the customer; excepting any guarantee surrendered for
cancellation on delivery of this instrument.

(10) The undersigned and each of them shall be bound by any account settled
between the Bank and the customer, and if no such account has been so settled
immediately before demand for payment under this guarantee any account stated by
the Bank shall be accepted by the undersigned and each of them as conclusive
evidence of the amount which at the date of the account so stated is due by the
customer to the Bank or remains unpaid by the customer to the Bank.

(11) This guarantee and agreement shall be operative and binding upon every
signatory thereof notwithstanding the non-execution thereof by any other
proposed signatory or signatories, and possession of this instrument by the Bank
shall be conclusive evidence against the undersigned and each of them that this
instrument was not delivered in escrow or pursuant to any agreement that it
should not be effective until any conditions precedent or subsequent had been
complied with, unless at the time of receipt of this instrument by the Bank each
signatory thereof obtains from the Manager of the branch or agency of the Bank
receiving this instrument a letter setting out the terms and conditions under
which this instrument was delivered and the conditions, if any, to be observed
before it becomes effective.


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(12) No suit based on this guarantee shall be instituted until demand for
payment has been made, and demand for payment shall be deemed to have been
effectually made upon any guarantor if and when an envelope containing such
demand, addressed to such guarantor at the address of such guarantor last known
to the Bank, is posted, postage prepaid, in the post office, and in the event of
the death of any guarantor demand for payment addressed to any of such
guarantor's heirs, executors, administrators or legal representatives at the
address of the addressee last known to the Bank and posted as aforesaid shall be
deemed to have been effectually made upon all of them. Moreover, when demand for
payment has been made, the undersigned shall also be liable to the Bank for all
legal costs (on a solicitor and own client basis) incurred by or on behalf of
the Bank resulting from any action instituted on the basis of this guarantee.
All payments hereunder shall be made to the Bank at a branch or agency of the
Bank.

(13) This instrument covers all agreements between the parties hereto relative
to this guarantee and assignment and postponement, and none of the parties shall
be bound by any representation or promise made by any person relative thereto
which is not embodied herein.

(14) This guarantee and agreement shall extend to and enure to the benefit of
the Bank and its successors and assigns, and every reference herein to the
undersigned or to each of them or to any of them, is a reference to and shall be
construed as including the undersigned and the heirs, executors, administrators,
legal representatives, successors and assigns of the undersigned or of each of
them or of any of them, as the case may be, to and upon all of whom this
guarantee and agreement shall extend and be binding.

(15) Prime Interest Rate is the annual rate of interest announced from time to
time by Royal Bank of Canada as a reference rate then in effect for determining
interest rates on Canadian dollar commercial loans in Canada.

(16) This Guarantee and Postponement of Claim shall be governed by and construed
in accordance with the laws of the Province of Ontario ("Jurisdiction"). The
undersigned irrevocably submits to the courts of the Jurisdiction in any action
or proceeding arising out of or relating to this Guarantee and Postponement of
Claim, and irrevocably agrees that all such actions and proceedings may be heard
and determined in such courts, and irrevocably waives, to the fullest extent
possible, the defense of an inconvenient forum. The undersigned agrees that a
judgment or order in any such action or proceeding may be enforced in other
jurisdictions in any manner provided by law. Provided, however, that the Bank
may serve legal process in any manner permitted by law or may bring an action or
proceeding against the undersigned or the property or assets of the undersigned
in the courts of any other jurisdiction.

(17) The Undersigned hereby acknowledges receipt of a copy of this agreement.
(#18 applicable in all PPSA provinces except Ontario)

(18) The Undersigned hereby waives Undersigned's right to receive a copy of any
Financing Statement or Financing Change Statement registered by the Bank.


GIVEN UNDER SEAL at Toronto this July 27, 2005
                                          ----
                                                        (MONTH) (DAY) (YEAR)
SIGNED, SEALED AND DELIVERED IN THE PRESENCE OF

                                            THOMAS EQUIPMENT, INC.

     -----------------------------------    Per:   /s/ CLIFFORD M. RHEE
      Witness                                          NAME:  CLIFFORD M. RHEE
                                                       TITLE: PRESIDENT

                                            I have authority to bind the
                                            Corporation
     -----------------------------------    ------------------------------------
      Witness


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