Document:

SUBSIDIARY
GUARANTEE

 

SUBSIDIARY
GUARANTEE, dated as of May 9, 2017 (this “Guarantee”), made by each of the signatories hereto (together with
any other entity that may become a party hereto as provided herein, the “Guarantors”), in favor of the purchasers
signatory (together with their permitted assigns, the “Purchasers”) to that certain Securities Purchase Agreement,
dated as of the date hereof, between MagneGas Corporation, a Delaware corporation (the “Company”) and the Purchasers.

 

W I T N E
S S E T H:

 

WHEREAS,
pursuant to that certain Securities Purchase Agreement, dated as of the date hereof, by and between the Company and the Purchasers
(the “Purchase Agreement”), the Company has agreed to sell and issue to the Purchasers, and the Purchasers
have agreed to purchase from the Company the Debentures, subject to the terms and conditions set forth therein; and

 

WHEREAS,
each Guarantor will directly benefit from the extension of credit to the Company represented by the issuance of the Debentures;
and

 

NOW,
THEREFORE, in consideration of the premises and to induce the Purchasers to enter into the Purchase Agreement and to carry out
the transactions contemplated thereby, each Guarantor hereby agrees with the Purchasers as follows:

 

1.                 
Definitions. Unless otherwise defined herein, terms defined in the Purchase Agreement and used herein shall have the meanings
given to them in the Purchase Agreement. The words “hereof,” “herein,” “hereto” and “hereunder”
and words of similar import when used in this Guarantee shall refer to this Guarantee as a whole and not to any particular provision
of this Guarantee, and Section and Schedule references are to this Guarantee unless otherwise specified. The meanings given to
terms defined herein shall be equally applicable to both the singular and plural forms of such terms. The following terms shall
have the following meanings:

 

“Guarantee”
means this Subsidiary Guarantee, as the same may be amended, supplemented or otherwise modified from time to time.

“Obligations” means, in addition to all other costs and expenses of collection incurred by Purchasers in enforcing
any of such Obligations and/or this Guarantee, all of the liabilities and obligations (primary, secondary, direct, contingent,
sole, joint or several) due or to become due, or that are now or may be hereafter contracted or acquired, or owing to, of the
Company or any Guarantor to the Purchasers, including, without limitation, all obligations under this Guarantee, the Debentures
and any other instruments, agreements or other documents executed and/or delivered in connection herewith or therewith, in each
case, whether now or hereafter existing, voluntary or involuntary, direct or indirect, absolute or contingent, liquidated or unliquidated,
whether or not jointly owed with others, and whether or not from time to time decreased or extinguished and later increased, created
or incurred, and all or any portion of such obligations or liabilities that are paid, to the extent all or any part of such payment
is avoided or recovered directly or indirectly from any of the Purchasers as a preference, fraudulent transfer or otherwise as
such obligations may be amended, supplemented, converted, extended or modified from time to time. Without limiting the generality
of the foregoing, the term “Obligations” shall include, without limitation: (i) principal of, and interest on the
Debentures and the loans extended pursuant thereto; (ii) any and all other fees, indemnities, costs, obligations and liabilities
of the Company or any Guarantor from time to time under or in connection with this Guarantee, the Debentures and any other instruments,
agreements or other documents executed and/or delivered in connection herewith or therewith; and (iii) all amounts (including
but not limited to post-petition interest) in respect of the foregoing that would be payable but for the fact that the obligations
to pay such amounts are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding
involving the Company or any Guarantor.

 

    1 

     

    

 

2.                 
Guarantee.

 

(a)               
Guarantee.

 

(i)                
The Guarantors hereby, jointly and severally, unconditionally and irrevocably, guarantee to the Purchasers and their respective
successors, indorsees, transferees and assigns, the prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations.

 

(ii)              
Anything herein or in any other Transaction Document to the contrary notwithstanding, the maximum liability of each Guarantor
hereunder and under the other Transaction Documents shall in no event exceed the amount which can be guaranteed by such Guarantor
under applicable federal and state laws, including laws relating to the insolvency of debtors, fraudulent conveyance or transfer
or laws affecting the rights of creditors generally (after giving effect to the right of contribution established in Section 2(b)).

 

(iii)            
Each Guarantor agrees that the Obligations may at any time and from time to time exceed the amount of the liability of
such Guarantor hereunder without impairing the guarantee contained in this Section 2 or affecting the rights and remedies of the
Purchasers hereunder.

 

(iv)            
The guarantee contained in this Section 2 shall remain in full force and effect until all the Obligations and the obligations
of each Guarantor under the guarantee contained in this Section 2 shall have been satisfied by indefeasible payment in full.

 

(v)              
No payment made by the Company or any of the Guarantors, any other guarantor or received or collected by the Purchasers
from the Company, any of the Guarantors, any other guarantor by virtue of any action or proceeding or any set-off or appropriation
or application at any time or from time to time in reduction of or in payment of the Obligations shall be deemed to modify, reduce,
release or otherwise affect the liability of any Guarantor hereunder which shall, notwithstanding any such payment (other than
any payment made by such Guarantor in respect of the Obligations or any payment received or collected from such Guarantor in respect
of the Obligations), remain liable for the Obligations up to the maximum liability of such Guarantor hereunder until the Obligations
are indefeasibly paid in full.

 

(vi)            
Notwithstanding anything to the contrary in this Guarantee, with respect to any defaulted non-monetary Obligations the
specific performance of which by the Guarantors is not reasonably possible (e.g. the issuance of the Company's Common Stock),
the Guarantors shall only be liable for making the Purchasers whole on a monetary basis for the Company's failure to perform such
Obligations in accordance with the Transaction Documents.

 

    2 

     

    

 

(b)              
Right of Contribution. Subject to Section 2(c), each Guarantor hereby agrees that to the extent that a Guarantor
shall have paid more than its proportionate share of any payment made hereunder, such Guarantor shall be entitled to seek and
receive contribution from and against any other Guarantor hereunder which has not paid its proportionate share of such payment.
Each Guarantor's right of contribution shall be subject to the terms and conditions of Section 2(c). The provisions of this Section
2(b) shall in no respect limit the obligations and liabilities of any Guarantor to the Purchasers and each Guarantor shall remain
liable to the Purchasers for the full amount guaranteed by such Guarantor hereunder.

 

(c)               
No Subrogation. Notwithstanding any payment made by any Guarantor hereunder or any set-off or application of funds
of any Guarantor by the Purchasers, no Guarantor shall be entitled to be subrogated to any of the rights of the Purchasers against
the Company or any other Guarantor or any collateral security or guarantee or right of offset held by the Purchasers for the payment
of the Obligations, nor shall any Guarantor seek or be entitled to seek any contribution or reimbursement from the Company or
any other Guarantor in respect of payments made by such Guarantor hereunder, until all amounts owing to the Purchasers by the
Company on account of the Obligations are indefeasibly paid in full. If any amount shall be paid to any Guarantor on account of
such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by
such Guarantor in trust for the Purchasers, segregated from other funds of such Guarantor, and shall, forthwith upon receipt by
such Guarantor, be turned over to the Purchasers in the exact form received by such Guarantor (duly indorsed by such Guarantor
to the Purchasers, if required), to be applied against the Obligations, whether matured or unmatured, in such order as the Purchasers
may determine.

 

(d)              
Amendments, Etc. With Respect to the Obligations. Each Guarantor shall remain obligated hereunder notwithstanding
that, without any reservation of rights against any Guarantor and without notice to or further assent by any Guarantor, any demand
for payment of any of the Obligations made by the Purchasers may be rescinded by the Purchasers and any of the Obligations continued,
and the Obligations, or the liability of any other Person upon or for any part thereof, or any collateral security or guarantee
therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended,
modified, accelerated, compromised, waived, surrendered or released by the Purchasers, and the Purchase Agreement and the other
Transaction Documents and any other documents executed and delivered in connection therewith may be amended, modified, supplemented
or terminated, in whole or in part, as the Purchasers may deem advisable from time to time, and any collateral security, guarantee
or right of offset at any time held by the Purchasers for the payment of the Obligations may be sold, exchanged, waived, surrendered
or released. The Purchasers shall have no obligation to protect, secure, perfect or insure any Lien at any time held by them as
security for the Obligations or for the guarantee contained in this Section 2 or any property subject thereto.

 

    3 

     

    

 

(e)               
Guarantee Absolute and Unconditional. Each Guarantor waives any and all notice of the creation, renewal, extension
or accrual of any of the Obligations and notice of or proof of reliance by the Purchasers upon the guarantee contained in this
Section 2 or acceptance of the guarantee contained in this Section 2; the Obligations, and any of them, shall conclusively be
deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the guarantee contained
in this Section 2; and all dealings between the Company and any of the Guarantors, on the one hand, and the Purchasers, on the
other hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon the guarantee contained in
this Section 2. Each Guarantor waives to the extent permitted by law diligence, presentment, protest, demand for payment and notice
of default or nonpayment to or upon the Company or any of the Guarantors with respect to the Obligations. Each Guarantor understands
and agrees that the guarantee contained in this Section 2 shall be construed as a continuing, absolute and unconditional guarantee
of payment and performance without regard to (a) the validity or enforceability of the Purchase Agreement or any other Transaction
Document, any of the Obligations or any other collateral security therefor or guarantee or right of offset with respect thereto
at any time or from time to time held by the Purchasers, (b) any defense, set-off or counterclaim (other than a defense of payment
or performance or fraud by Purchasers) which may at any time be available to or be asserted by the Company or any other Person
against the Purchasers, or (c) any other circumstance whatsoever (with or without notice to or knowledge of the Company or such
Guarantor) which constitutes, or might be construed to constitute, an equitable or legal discharge of the Company for the Obligations,
or of such Guarantor under the guarantee contained in this Section 2, in bankruptcy or in any other instance. When making any
demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, the Purchasers may, but shall
be under no obligation to, make a similar demand on or otherwise pursue such rights and remedies as they may have against the
Company, any other Guarantor or against any collateral security or guarantee for the Obligations or any right of offset with respect
thereto, and any failure by the Purchasers to make any such demand, to pursue such other rights or remedies or to collect any
payments from the Company or any other Guarantor or to exercise any such right of offset, or any release of the Company or any
other Guarantor or any such guarantee or right of offset, shall not relieve any Guarantor of any obligation or liability hereunder,
and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Purchasers
against any Guarantor. For the purposes hereof, “demand” shall include the commencement and continuance of any legal
proceedings.

 

(f)               
Reinstatement. The guarantee contained in this Section 2 shall continue to be effective, or be reinstated, as the
case may be, if at any time payment, or any part thereof, of any of the Obligations is rescinded or must otherwise be restored
or returned by the Purchasers upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Company or any
Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer
for, the Company or any Guarantor or any substantial part of its property, or otherwise, all as though such payments had not been
made.

 

(g)              
Payments. Each Guarantor hereby guarantees that payments hereunder will be paid to the Purchasers without set-off
or counterclaim in U.S. dollars at the address set forth or referred to in the Signature Pages to the Purchase Agreement.

 

    4 

     

    

 

3.                 
Representations and Warranties. Each Guarantor hereby makes the following representations and warranties to Purchasers
as of the date hereof:

 

(a)               
Organization and Qualification. The Guarantor is a corporation or limited liability company, duly incorporated,
validly existing and in good standing under the laws of the applicable jurisdiction set forth on Schedule 1, with the requisite
corporate power and authority to own and use its properties and assets and to carry on its business as currently conducted. The
Guarantor has no subsidiaries other than those identified as such on the Disclosure Schedules to the Purchase Agreement. The Guarantor
is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction in which the nature of
the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified
or in good standing, as the case may be, could not, individually or in the aggregate, (x) adversely affect the legality, validity
or enforceability of any of this Guaranty in any material respect, (y) have a material adverse effect on the results of operations,
assets, prospects, or financial condition of the Guarantor or (z) adversely impair in any material respect the Guarantor's ability
to perform fully on a timely basis its obligations under this Guaranty (a “Material Adverse Effect”).

 

(b)              
Authorization; Enforcement. The Guarantor has the requisite corporate power and authority to enter into and to consummate
the transactions contemplated by this Guaranty, and otherwise to carry out its obligations hereunder. The execution and delivery
of this Guaranty by the Guarantor and the consummation by it of the transactions contemplated hereby have been duly authorized
by all requisite corporate action on the part of the Guarantor. This Guaranty has been duly executed and delivered by the Guarantor
and constitutes the valid and binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally the enforcement of, creditors' rights and remedies or by other equitable principles
of general application.

 

(c)               
No Conflicts. The execution, delivery and performance of this Guaranty by the Guarantor and the consummation by
the Guarantor of the transactions contemplated thereby do not and will not (i) conflict with or violate any provision of its organizational
or governance documents or (ii) other than the obligations of the Guarantors under the Senior Convertible Debenture, conflict
with, constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Guarantor
is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction
of any court or governmental authority to which the Guarantor is subject (including Federal and State securities laws and regulations),
or by which any material property or asset of the Guarantor is bound or affected, except in the case of each of clauses (ii) and
(iii), such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as could not, individually
or in the aggregate, have or result in a Material Adverse Effect. The business of the Guarantor is not being conducted in violation
of any law, ordinance or regulation of any governmental authority, except for violations which, individually or in the aggregate,
do not have a Material Adverse Effect.

 

    5 

     

    

 

(d)              
Consents and Approvals. The Guarantor is not required to obtain any consent, waiver, authorization or order of,
or make any filing or registration with, any court or other federal, state, local, foreign or other governmental authority or
other person in connection with the execution, delivery and performance by the Guarantor of this Guaranty.

 

(e)               
Purchase Agreement. The representations and warranties of the Company set forth in the Purchase Agreement as they
relate to such Guarantor, each of which is hereby incorporated herein by reference, are true and correct as of each time such
representations are deemed to be made pursuant to such Purchase Agreement, and the Purchasers shall be entitled to rely on each
of them as if they were fully set forth herein, provided that each reference in each such representation and warranty to the Company's
knowledge shall, for the purposes of this Section 3, be deemed to be a reference to such Guarantor's knowledge.

 

4.                 
Covenants.

 

(a)         
Each Guarantor covenants and agrees with the Purchasers that, from and after the date of this Guarantee until the Obligations
shall have been indefeasibly paid in full, such Guarantor shall take, and/or shall refrain from taking, as the case may be, each
commercially reasonable action that is necessary to be taken or not taken, as the case may be, so that no Event of Default (as
defined in the Debentures) is caused by the failure to take such action or to refrain from taking such action by such Guarantor.

 

(b)        
So long as any of the Obligations are outstanding, unless Purchasers holding at least 81% of the aggregate principal amount
of the then outstanding Debentures shall otherwise consent in writing, each Guarantor, severally, will not directly or indirectly
on or after the date of this Guarantee:

 

i.                       
other than Permitted Indebtedness or Indebtedness of up to $150,000 in the aggregate in any 12 month-period, enter into, create,
incur, assume, guarantee or suffer to exist any indebtedness for borrowed money of any kind, including but not limited to, a guarantee,
on or with respect to any of its property or assets now owned or hereafter acquired or any interest therein or any income or profits
therefrom;

 

ii.                       
other than Permitted Liens, enter into, create, incur, assume or suffer to exist any Liens of any kind, on or with respect to
any of its property or assets now owned or hereafter acquired or any interest therein or any income or profits therefrom;

 

iii.                       
amend its certificate of incorporation, bylaws or other charter documents so as to adversely affect any rights of any Purchaser;

 

iv.                       
repay, repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis
number of shares of its securities or debt obligations;

 

v.                       
pay cash dividends on any equity securities of the Company; or

 

vi.                       
enter into any agreement with respect to any of the foregoing.

 

    6 

     

    

 

5.                 
Miscellaneous.

 

(a)               
Amendments in Writing. None of the terms or provisions of this Guarantee may be waived, amended, supplemented or
otherwise modified except in writing by the Purchasers.

 

(b)              
Notices. All notices, requests and demands to or upon the Purchasers or any Guarantor hereunder shall be effected
in the manner provided for in the Purchase Agreement, provided that any such notice, request or demand to or upon any Guarantor
shall be addressed to such Guarantor at its notice address set forth on Schedule 5(b).

 

(c)               
No Waiver By Course Of Conduct; Cumulative Remedies. The Purchasers shall not by any act (except by a written instrument
pursuant to Section 5(a)), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any default under the Transaction Documents or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Purchasers, any right, power or privilege hereunder shall operate as a waiver thereof. No single
or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Purchasers of any right or remedy hereunder on any one occasion shall
not be construed as a bar to any right or remedy which the Purchasers would otherwise have on any future occasion. The rights
and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights
or remedies provided by law.

 

(d)              
Enforcement Expenses; Indemnification.

 

(i)                
Each Guarantor agrees to pay, or reimburse the Purchasers for, all its costs and expenses incurred in collecting against
such Guarantor under the guarantee contained in Section 2 or otherwise enforcing or preserving any rights under this Guarantee
and the other Transaction Documents to which such Guarantor is a party, including, without limitation, the reasonable fees and
disbursements of counsel to the Purchasers.

 

(ii)              
Each Guarantor agrees to pay, and to save the Purchasers harmless from, any and all liabilities with respect to, or resulting
from any delay in paying, any and all stamp, excise, sales or other taxes which may be payable or determined to be payable in
connection with any of the transactions contemplated by this Guarantee.

 

(iii)            
Each Guarantor agrees to pay, and to save the Purchasers harmless from, any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to the execution,
delivery, enforcement, performance and administration of this Guarantee to the extent the Company would be required to do so pursuant
to the Purchase Agreement.

 

(iv)            
The agreements in this Section shall survive repayment of the Obligations and all other amounts payable under the Purchase
Agreement and the other Transaction Documents.

 

    7 

     

    

 

(e)               
Successor and Assigns. This Guarantee shall be binding upon the successors and assigns of each Guarantor and shall
inure to the benefit of the Purchasers and their respective successors and assigns; provided that no Guarantor may assign, transfer
or delegate any of its rights or obligations under this Guarantee without the prior written consent of the Purchasers.

 

(f)               
Set-Off. Each Guarantor hereby irrevocably authorizes the Purchasers at any time and from time to time while an
Event of Default under any of the Transaction Documents shall have occurred and be continuing, without notice to such Guarantor
or any other Guarantor, any such notice being expressly waived by each Guarantor, to set-off and appropriate and apply any and
all deposits, credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by the Purchasers to or for the credit or the account of such Guarantor, or any
part thereof in such amounts as the Purchasers may elect, against and on account of the obligations and liabilities of such Guarantor
to the Purchasers hereunder and claims of every nature and description of the Purchasers against such Guarantor, in any currency,
whether arising hereunder, under the Purchase Agreement, any other Transaction Document or otherwise, as the Purchasers may elect,
whether or not the Purchasers have made any demand for payment and although such obligations, liabilities and claims may be contingent
or unmatured. The Purchasers shall notify such Guarantor promptly of any such set-off and the application made by the Purchasers
of the proceeds thereof, provided that the failure to give such notice shall not affect the validity of such set-off and application.
The rights of the Purchasers under this Section are in addition to other rights and remedies (including, without limitation, other
rights of set-off) which the Purchasers may have.

 

(g)              
Counterparts. This Guarantee may be executed by one or more of the parties to this Guarantee on any number of separate
counterparts (including by telecopy), and all of said counterparts taken together shall be deemed to constitute one and the same
instrument.

 

(h)              
Severability. Any provision of this Guarantee which is prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction.

 

(i)                
Section Headings. The Section headings used in this Guarantee are for convenience of reference only and are not
to affect the construction hereof or be taken into consideration in the interpretation hereof.

 

(j)                
Integration. This Guarantee and the other Transaction Documents represent the agreement of the Guarantors and the
Purchasers with respect to the subject matter hereof and thereof, and there are no promises, undertakings, representations or
warranties by the Purchasers relative to subject matter hereof and thereof not expressly set forth or referred to herein or in
the other Transaction Documents.

 

(k)              
Governing Laws. All questions concerning the construction, validity, enforcement and interpretation of this Guarantee
shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard
to the principles of conflicts of law thereof. Each of the Company and the Guarantors agree that all proceedings concerning the
interpretations, enforcement and defense of the transactions contemplated by this Guarantee (whether brought against a party hereto
or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively
in the state and federal courts sitting in the City of New York, Borough of Manhattan. Each of the Company and the Guarantors
hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough
of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives, and agrees not to assert in any proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such proceeding is improper. Each party hereto hereby irrevocably waives personal
service of process and consents to process being served in any such proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Guarantee
and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner permitted by law. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising
out of or relating to this Guarantee or the transactions contemplated hereby.

 

    8 

     

    

 

(l)                
Acknowledgements. Each Guarantor hereby acknowledges that:

 

(i)                
it has been advised by counsel in the negotiation, execution and delivery of this Guarantee and the other Transaction Documents
to which it is a party;

 

(ii)              
the Purchasers have no fiduciary relationship with or duty to any Guarantor arising out of or in connection with this Guarantee
or any of the other Transaction Documents, and the relationship between the Guarantors, on the one hand, and the Purchasers, on
the other hand, in connection herewith or therewith is solely that of debtor and creditor; and

 

(iii)            
no joint venture is created hereby or by the other Transaction Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Guarantors and the Purchasers.

 

(m)            
Additional Guarantors. The Company shall cause each of its subsidiaries formed or acquired on or subsequent to the
date hereof to become a Guarantor for all purposes of this Guarantee by executing and delivering an

Assumption Agreement in the form of Annex 1 hereto.

 

(n)              
Release of Guarantors. Each Guarantor will be released from all liability hereunder concurrently with the indefeasible
repayment in full of all amounts owed under the Purchase Agreement, the Debentures and the other Transaction Documents.

 

(o)              
Seniority. Except with respect to the Senior Convertible Debentures held by the Guarantees, the Obligations of each
of the Guarantors hereunder rank senior in priority to any other Indebtedness (as defined in the Purchase Agreement) of such Guarantor.

 

(p)              
WAIVER OF JURY TRIAL. EACH GUARANTOR AND, BY ACCEPTANCE OF THE BENEFITS HEREOF, THE PURCHASERS, HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS GUARANTEE AND FOR ANY COUNTERCLAIM
THEREIN.

 

*********************

 

 

 

(Signature
Pages Follow)

 

    9 

     

    

 

IN
WITNESS WHEREOF, each of the undersigned has caused this Guarantee to be duly executed and delivered as of the date first above
written.

 

	 	Equipment Sales and Service, Inc. 
	 	 	 
	 	By:	/s/Ermanno
    Santilli
	 	Name:	Ermanno
    Santilli
	 	Title:  	Chief
    Executive Officer 
	 	 	 
	 	MagneGas Welding Supply, LLC
	 	 	 
	 	By:_	/s/Ermanno
    Santill
	 	Name:	Ermanno
    Santilli
	 	Title:  	Chief
    Executive Officer 
	 		 
	 	MagneGas Real Estate Holdings, LLC
	 	 	 
	 	By:	/s/Ermanno
    Santilli
	 	Name:	Ermanno
    Santilli
	 	Title:   	Chief
    Executive Officer 
	 	 	 
	 	MagneGas
    Energy Solutions, LLC 
	 	 	 
	 	By:	/s/Ermanno
    Santilli
	 	Name:	Ermanno
    Santilli
	 	Title:  	Chief
    Executive Officer 
	 	 	 
	 	MagneGas
    IP, LLC 
	 	 	 
	 	By:	/s/Ermanno
    Santilli
	 	Name:	Ermanno
    Santilli
	 	Title:  	Chief
    Executive Officer 
	 	 	 
	 	MagneGas Production, LLC  
	 	 	 
	 	By:	/s/Ermanno
    Santilli
	 	Name:	Ermanno Santilli
	 	Title:  	Chief Executive Officer

 

    10 

     

    

 

SCHEDULE
1

 

GUARANTORS

 

The following
are the names, notice addresses and jurisdiction of organization of each Guarantor.

 

	 	 	 	 	COMPANY	 
	 	 	JURISDICTION
    OF	 	OWNED
    BY	 
	 	 	INCORPORATION	 	PERCENTAGE	 
	 	 	 	 	 	 
	Equipment
    Sales and Services, Inc.	 	Florida	 	 	100	%
	 	 	 	 	 	 	 
	MagneGas
    Welding Supply, LLC	 	Delaware	 	 	100	%
	 	 	 	 	 	 	 
	MagneGas
    Real Estate Holdings, LLC	 	Delaware	 	 	100	%
	 	 	 	 	 	 	 
	MagneGas
    Energy Solutions, LLC	 	Delaware	 	 	100	%
	 	 	 	 	 	 	 
	MagneGas
    IP, LLC	 	Delaware	 	 	100	%
	 	 	 	 	 	 	 
	MagneGas
    Production, LLC	 	Delaware	 	 	100	%

 

 

 

    11 

     

    

 

Annex
1 to

SUBSIDIARY
GUARANTEE

 

ASSUMPTION
AGREEMENT, dated as of ___________ ____, 20___ made by ______________________________, a ______________ _______________________
(the “Additional Guarantor”), in favor of the Purchasers pursuant to the Purchase Agreement referred to below.
All capitalized terms not defined herein shall have the meaning ascribed to them in such Purchase Agreement.

       W I T N E S S E T H :

 

 WHEREAS,
MagneGas Corporation, a Delaware corporation (the “Company”) and the Purchasers have entered into a Securities
Purchase Agreement, dated as of May 9, 2017 (as amended, supplemented or otherwise modified from time to time, the “Purchase
Agreement”);

 

WHEREAS,
in connection with the Purchase Agreement, the Subsidiaries of the Company (other than the Additional Guarantor) have entered
into the Subsidiary Guarantee, dated as of May 9, 2017 (as amended, supplemented or otherwise modified from time to time, the
“Guarantee”) in favor of the Purchasers;

 

WHEREAS,
the Purchase Agreement requires the Additional Guarantor to become a party to the Guarantee; and

 

WHEREAS,
the Additional Guarantor has agreed to execute and deliver this Assumption Agreement in order to become a party to the Guarantee;

 

NOW,
THEREFORE, IT IS AGREED:

 

1.                 
Guarantee. By executing and delivering this Assumption Agreement, the Additional Guarantor, as provided in Section 5(m)
of the Guarantee, hereby becomes a party to the Guarantee as a Guarantor thereunder with the same force and effect as if originally
named therein as a Guarantor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and
liabilities of a Guarantor thereunder. The information set forth in Annex 1 hereto is hereby added to the information set forth
in Schedule 1 to the Guarantee. The Additional Guarantor hereby represents and warrants that each of the representations and warranties
contained in Section 3 of the Guarantee is true and correct on and as the date hereof as to such Additional Guarantor (after giving
effect to this Assumption Agreement) as if made on and as of such date.

 

2.                 
Governing Law. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW
OF THE STATE OF NEW YORK.

 

    12 

     

    

 

IN
WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed and delivered as of the date first above
written.

 

	 	[ADDITIONAL GUARANTOR]
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

    13albo-ex101_158.htm

 

Exhibit 10.1

ALBIREO PHARMA, INC.

NONEMPLOYEE DIRECTOR COMPENSATION POLICY

(Adopted January 23, 2017)

The Board of Directors of Albireo Pharma, Inc. (the “Company”) has approved the following Nonemployee Director Compensation Policy (this “Policy”) to provide an inducement to obtain and retain the services of qualified persons to serve as members of the Company’s Board of Directors.  The Policy establishes compensation to be paid to nonemployee directors of the Company.

Applicable Persons

This Policy shall apply to each director of the Company who is not an employee of, or compensated consultant to, the Company or any Affiliate (each, an “Outside Director”). “Affiliate” shall mean an entity which is a direct or indirect parent or subsidiary of the Company, as determined pursuant to Section 424 of the Internal Revenue Code of 1986, as amended.

Compensation

	
A.
	
Equity Grants

1.Annual Stock Option Grants

Each Outside Director shall be granted, automatically and without any action on the part of the Board of Directors, under the Company’s 2016 Equity Incentive Plan or a successor plan (the “Equity Plan”), a nonqualified stock option to purchase 3,000 shares of the Company’s common stock, par value $0.01 per share (“Common Stock”), each year on the fifth (5th) business day after the Company’s annual meeting of stockholders (the “Annual Stock Options”); provided, however, that if there has been no annual meeting of stockholders held by the first business day of the third fiscal quarter, each Outside Director shall be granted, automatically and without any action on the part of the Board of Directors, such Annual Stock Option on the first business day of the third fiscal quarter of such year.

2.Initial Stock Option Grants for Newly Appointed or Elected Directors

Each new Outside Director shall be granted, automatically and without any action on the part of the Board of Directors, under the Equity Plan, a nonqualified stock option to purchase 4,500 shares of Common Stock on the date that the Outside Director is first appointed or elected to the Board of Directors (the “Initial Stock Options” and, together with the Annual Stock Options, the “Outside Director Stock Options”).

3.Terms of Outside Director Stock Options

Unless otherwise specified by the Board of Directors or the Compensation Committee at the time of grant, each Outside Director Stock Option shall: (i) vest, in the case of (A) an Annual Stock Option, on the earlier of (a) one year from the date of the grant or (b) the day prior to the annual meeting for the next fiscal year that begins following the date of grant, subject to the Outside Director’s continued service on the Board of Directors on the vesting date, and (B) an Initial Stock Option, in equal annual installments over three years from the date of grant; provided that each Initial Stock Option shall in any case be fully vested on the day prior to the annual meeting for the third fiscal year that begins following the date of 

grant, subject to the Outside Director’s continued service on the Board of Directors on the applicable vesting dates; (ii) terminate 10 years from the date of grant, (iii) become fully vested immediately prior to a Change of Control (as defined in the Equity Plan, as amended from time to time), and (iv) be granted under the Company’s standard form of agreement unless on or prior to the date of grant the Board of Directors or the Compensation Committee shall determine that other terms or conditions shall be applicable.

 

	
B.
	
Cash Fees

1.Annual Cash Fees

The following annual cash fees shall be paid to the Outside Directors serving on the Board of Directors and the Audit Committee, Compensation Committee and Nominating and Governance Committee, as applicable.

	
Board of Directors or Committee of Board of Directors
	
 
	
Annual Retainer Amount for Chair
	
 
	
 
	
Annual Retainer Amount for Other Members
	
 

	
Board of Directors
	
 
	
$
	
60,000
	
 
	
 
	
$
	
35,000
	
 

	
Audit Committee
	
 
	
$
	
15,000
	
 
	
 
	
$
	
7,500
	
 

	
Compensation Committee
	
 
	
$
	
15,000
	
 
	
 
	
$
	
7,500
	
 

	
Nominating and Governance Committee
	
 
	
$
	
7,500
	
 
	
 
	
$
	
3,750
	
 

 

2.Payment Terms for All Cash Fees

Cash fees payable to Outside Directors shall be paid quarterly in arrears as soon as practicable following the last business day of each fiscal quarter.

Following an Outside Director’s first election or appointment to the Board of Directors, such Outside Director shall receive his or her cash compensation prorated during the first fiscal quarter in which he or she was initially appointed or elected for the number of days during which he or she provides service. If an Outside Director dies, resigns or is removed during any quarter, he or she shall be entitled to a cash payment on a prorated basis through his or her last day of service that shall be paid as soon as practicable following the last business day of the fiscal quarter.

Expenses

Upon presentation of documentation of such expenses reasonably satisfactory to the Company, each Outside Director shall be reimbursed for his or her reasonable out-of-pocket business expenses incurred in connection with attending meetings of the Board of Directors and Committees thereof or in connection with other business related to the Board of Directors. Each Outside Director shall abide by the Company’s travel and other expense policies applicable to Company personnel.

2

 

Amendments

The Compensation Committee or the Board of Directors shall review this Policy from time to time to assess whether any amendments in the type and amount of compensation provided herein should be adjusted in order to fulfill the objectives of this Policy. 

3

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