mis_8k1130ex1011.htm


    Exhibit
      10.11

     

    


     

    Magnetech
      DeWees Non-Compete Agreement

     

    This
Non-Compete
      Agreement (“Agreement”) is made and
      entered into this 30th day of November, 2007 (“Effective Date”), by and between
      Magnetech Industrial Services, Inc., an Indiana corporation (“Magnetech” or
“Company”) and Bernard L. DeWees (“DeWees”).

     

    Recitals:

     

    A.           Since
      March 1, 2002, 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 800 Nave Road SE in Massillon, Ohio,
      and at 870 Crescentville Road in Cincinnati, Ohio (“the Business”).

     

    B.           DeWees
      has been the President of 3-D since its
      inception.  Through BDeWees, Inc., an Ohio corporation which he wholly
      owns, DeWees has also owned fifty percent (50%) of 3-D since its
      inception.

     

    C.           DeWees
      is intimately familiar with the Business, including its operations, employees,
      suppliers and customers.

     

    D.           Pursuant
      to the 3-D Membership Interest Purchase Agreement (the “Membership Interest
      Purchase Agreement”), executed November 30, 2007, Magnetech has purchased
      substantially all of the Membership Interests of 3-D.

     

    E.           Magnetech
      would not have been willing to enter into the Membership Interest Purchase
      Agreement without the agreement of DeWees to execute this Agreement, along
      with
      the execution of a similar agreement by Thomas J. Embrescia
      (“Embrescia”).

     

    F.           The
      consummation by Magnetech of the transactions contemplated by the Membership
      Interest Purchase Agreement is in reliance upon the assurance of DeWees that
      he
      will comply fully with all of the terms and conditions of this
      Agreement.

     

    G.           3-D,
      now a wholly-owned subsidiary of Magnetech, has entered into a lease for
      facilities in Massillon, Ohio in accordance with Article 6.01(d) of the
      Membership Interest Purchase Agreement (“Lease”).

     

    H.           Magnetech
      has delivered its Promissory Note to BDeWees, Inc. in the amount of
      $2,000,000.00 in accordance with Section 3.04 of the Membership Interest
      Purchase Agreement (“Note”)

     

    NOW,
      THEREFORE, in consideration of the promises and covenants herein
      exchanged and for other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the parties hereto agree as
      follows:

     

    1.           Consideration.  DeWees
      hereby acknowledges and
      agrees
      that his execution of this Agreement is
      a material inducement to Magnetech
      to consummate the transactions
      contemplated by the Membership Interest Purchase
      Agreement. DeWees
      further acknowledges and agrees that
      the consummation by Magnetech
      of the transactions contemplated by
      the

     


    
      
        
        

      

      
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    Membership
      Interest Purchase Agreement, with the
      resulting
      significant benefits to the DeWees,
      constitutes sufficient consideration
      to support the covenants set forth in this Agreement.

     

    2.           Term.  This
      Agreement shall commence on the Effective Date and continue for a period of
      two
      (2) years.

     

    3.           Covenants
      of DeWees.

     

    (a)           Covenants
      Against Competition and Solicitation.  DeWees agrees that he will
      not, for the Prohibited Period (as defined below), without the express written
      consent of Company, unless there has been a default by the Company under the
      Lease or the Note that has not been cured in the period of time allowed for
      cure
      in the Lease:

     

    (i)           Directly
      or indirectly, as a proprietor, officer, employee, partner, stockholder,
      consultant, agent, owner or otherwise, work for, render assistance or services
      to or otherwise participate in any business that competes with or engages in
      business substantially similar to the Business anywhere within the Prohibited
      Territory (as defined below);

    


    (ii)           Directly
      or indirectly, induce, hire or solicit or seek to induce, hire or solicit any
      person who was engaged with 3-D as an employee, agent, independent contractor
      or
      otherwise at any time within one year before the Closing Date to end his or
      her
      engagement or employment with Company; or

    


    (iii)           Either
      for himself or for any other person, firm, corporation or entity, solicit,
      divert or accept, or attempt to solicit, divert or accept any persons or
      entities which were customers or suppliers of 3-D at any time within one year
      before the Closing Date.

    


    For
      purposes of this Agreement, the “Prohibited Territory” means anywhere within a
      one thousand (1000) mile radius of each of 3-D’s locations (in Massillon and
      Cincinnati), unless that geographic restriction is deemed to be of unreasonably
      broad scope, and therefore unenforceable, by a court of competent jurisdiction,
      in which case the next sentence shall define the Prohibited
      Territory.  The Prohibited Territory means anywhere within a
      five-hundred (500) mile radius of each of 3-D’s locations (in Massillon and
      Cincinnati), unless that geographic restriction is deemed to be of unreasonably
      broad scope, and therefore unenforceable, by a court of competent jurisdiction,
      in which case the next sentence shall define the Prohibited
      Territory.  The Prohibited Territory means anywhere within a
      two-hundred-fifty (250) mile radius of each of 3-D’s locations (in Massillon and
      Cincinnati).

    


    The
      term
“Prohibited Period” shall be defined as a period of two (2) years from and after
      the Closing Date as defined in the Membership Interest Purchase
      Agreement.

    


    (b)           Reasonableness
      of Covenants.  DeWees acknowledges and agrees that the temporal,
      geographic and other limitations contained in this Section 3 are reasonable
      and


    
      
        
        

      

      
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    necessary
      for the proper protection of Magnetech’s investment in the Membership Interests
      of 3-D and shall be enforceable to
      the fullest extent permitted by law.

    


    (c)           Modification.  In
      the event that any term, provision or covenant contained in this Section 3
      is
      found to be unreasonable, and therefore unenforceable, by a court of competent
      jurisdiction, but would be valid and enforceable if any part thereof were
      deleted or otherwise modified, then the parties expressly agree that a court
      may
      limit the application of, or modify any such term, provision or covenant and
      proceed to enforce such term, provision or covenant as so limited or
      modified.

    


    4.           Remedies
      for Breach.  DeWees acknowledges that Company’s remedy at law
      for any breach of DeWees’ obligations under Section 3 would be inadequate and
      specifically agrees that Company shall be entitled to injunctive relief against
      him, without the necessity of proof of actual damage or the posting of a bond,
      in addition to any other remedies available at law or in equity, including
      compensatory damages incurred by Company as a result of such violation and
      including costs, expenses and reasonable attorneys’ fees in enforcing any of its
      rights under Section 3.    The rights and remedies set forth
      in this Agreement shall be cumulative and not exclusive.

     

    5.           Miscellaneous.

     

    (a)           Notices.   Any
      notice
      required or permitted to be given under this Agreement shall be in writing
      and
      shall be deemed to have been duly given on the date delivered, if delivered
      in
      person, or on the date mailed, if mailed first-class, postage prepaid, certified
      mail, return receipt requested, at the address set forth below (or such other
      address as may be given by like notice):

     

    
      	 	
              If
                to Company:

            	 	 
	 	 	
              Magnetech
                Industrial Services, Inc.

            
	 	 	
              1125
                South Walnut Street

            
	 	 	
              South
                Bend, Indiana  46619

            
	 	 	
              Attn:

            	
              John
                A. Martell

            
	 	 	
              and

            	
              James
                M. Lewis

            
	 	 	 	 
	 	 	 	
              with
                a copy to:

            
	 	 	 	 
	 	 	 	
              Barnes
                & Thornburg LLP

            
	 	 	 	
              600
                1st Source Bank Center

            
	 	 	 	
              100
                North Michigan

            
	 	 	 	
              South
                Bend, Indiana 46601

            
	 	 	 	
              Attn:  Richard
                L. Mintz, Esq.

            
	 	 	 	 
	 	
              If
                to DeWees:

            	
              Bernard
                L. DeWees

            
	 	 	
              5316
                Hawick Street, NW

            
	 	 	
              Canton,
                OH 44708

            
	 	 	 	 
	 	 	 	
              with
                a copy to:

            
	 	 	 	 


    

    



    
      
        
        

      

      
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              DAY
                KETTERER LTD.

            
	 	 	 	
              Millennium
                Centre, Ste. 300

            
	 	 	 	
              200
                Market Avenue North

            
	 	 	 	
              Canton,
                Ohio 44702

            
	 	 	 	
              Attn:  Daniel
                A. Minkler

            


    

    


    (b)           Assignment;
      Binding Effect. No party to this Agreement may assign this Agreement or
      such party’s right, duties and obligations hereunder without the prior written
      consent of the other party hereto; provided, that Company shall have
      the right to assign its rights hereunder to an Affiliate of
      Company.  Subject to the foregoing, this Agreement shall be binding
      upon and inure to the benefit of the parties to this Agreement and their heirs,
      personal and legal representatives, successors and assigns.  For
      purposes of this Agreement, “Affiliate” means a person or entity that directly
      or indirectly, through one or more intermediaries, controls, is controlled
      by,
      or is under common control with, another person or entity or which any person
      or
      entity owns or controls directly or indirectly 50% or more of the voting shares
      or of the value of such person or entity or has the ability to control the
      management or affairs of such person or entity.

     

    (c)           Severability.  If
      any provision of this Agreement shall be held invalid or unenforceable by any
      court of competent jurisdiction or as a result of legislative or administrative
      action, such holding or action shall be strictly construed and shall not affect
      the validity or affect any other provision of this Agreement.

     

    (d)Governing
      Law; Venue.  This
      Agreement shall be construed, interpreted and enforced in accordance with the
      laws of the State of Ohio, without giving effect to principles of conflicts
      of
      laws. The parties expressly consent to exclusive personal jurisdiction and
      venue
      in the federal and state courts of the State of Ohio.

    (e)           Waiver. The
      failure of any party to enforce at
      any time or for any period of time any of the provisions of this Agreement
      shall
      not be construed as a waiver of such provision or of the right of the party
      to
      enforce such provision.  The waiver of any breach or default or the
      failure to exercise any right shall not be deemed a waiver of any subsequent
      breach or default or waiver of the right to exercise any other
      right.

     

    (f)           Entire
      Agreement and Amendment. This Agreement sets forth the entire understanding
      of the parties, there being no oral or other written agreements or
      understandings between them relating to the subject matter hereof, and
      supersedes and replaces all other prior agreements, understandings or letters
      of
      intent between the parties with regard to the subject matter of this
      Agreement.  No modification, amendment, waiver or release of any
      provision of this Agreement or of any right, obligation, claim or cause of
      action arising under this Agreement shall be valid or binding for any purpose
      unless in writing and duly executed by the party against whom the same is sought
      to be asserted.

     

    IN
      WITNESS WHEREOF, Company has caused this Non-Compete Agreement to be executed
      on
      its behalf by its authorized officer and DeWees has executed this Non-Compete
      Agreement on the date or dates indicated below, effective as of the Effective
      Date.

     


    
      
        
        

      

      
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              Bernard
                L. DeWees

            	 	
              Magnetech
                Industrial Services, Inc.

            
	 	 	 	 	 
	 	 	 	 	 
	/s/
              Bernard L. DeWees 	 	/s/
              John A. Martell 
	
              Bernard
                L. DeWees

            	 	
              John
                A. Martell, President and CEO

            
	 	 	 	 	 
	
              Date:

            	November
              30, 2007	 	
              Date:

            	November
              30, 2007


    

    
 

     

     

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