Exhibit 10.8
 
THIS INSTRUMENT IS SUBJECT TO THE TERMS OF A SUBORDINATION AGREEMENT AND/OR
SUBORDINATION AND INTERECREDITOR AGREEMENT IN FAVOR OF FAUNUS GROUP
INTERNATIONAL, INC. AND EACH HOLDER HEREOF BY ITS ACCEPTANCE HEREOF SHALL BE
BOUND BY THE PROVISIONS OF SUCH SUBORDINATION AGREEMENT.
 
GUARANTY
 
GUARANTY, dated as of April 12, 2011, made by each of the undersigned (each a
“Guarantor”, and collectively, the “Guarantors”), in favor of WORLDWIDE STOCK
TRANSFER LLC, A NEW JERSEY LIMITED LIABILITY COMPANY, in its capacity as
collateral agent (in such capacity, the “Collateral Agent”) for the “Purchasers”
(as defined below) party to the Securities Purchase Agreement (as defined
below).
 
W I T N E S S E T H :
 
WHEREAS, Ads in Motion, Inc., a Delaware corporation (the “Company”) and each
party listed as a “Purchaser” on Schedule I attached to the Securities Purchase
Agreement (collectively, the “Purchasers”) are parties to the Securities
Purchase Agreement dated as of the date hereof (as amended, restated, replaced
or otherwise modified from time to time, the “Securities Purchase Agreement”),
pursuant to which the Company shall be required to sell, and the Purchasers
shall purchase or have the right to purchase, the “Notes” (as defined therein)
issued pursuant to the Securities Purchase Agreement (as defined therein);
 
WHEREAS, the Securities Purchase Agreement requires that the Guarantors execute
and deliver to the Collateral Agent, (i) a guaranty guaranteeing all of the
obligations of the Company under the Securities Purchase Agreement, the Notes
and the “Transaction Documents” (as defined in the Securities Purchase
Agreement, the “Transaction Documents”); and (ii) a Security Agreement dated the
date hereof granting the Collateral Agent a lien in all of their personal
property (the “Security Agreement”); and
 
WHEREAS, each Guarantor has determined that the execution, delivery and
performance of this Guaranty directly benefits, and is in the best interest of,
such Guarantor;
 
NOW, THEREFORE, in consideration of the premises and the agreements herein and
in order to induce the Purchasers to perform under the Securities Purchase
Agreement, each Guarantor hereby agrees with each Purchaser as follows:
 
SECTION 1. Definitions.  Reference is hereby made to the Securities Purchase
Agreement and the Notes for a statement of the terms thereof.  All terms used in
this Guaranty, which are defined in the Securities Purchase Agreement or the
Notes and not otherwise defined herein, shall have the same meanings herein as
set forth therein.
 
 
 

--------------------------------------------------------------------------------

 
 
SECTION 2. Guaranty.  The Guarantors, jointly and severally, hereby
unconditionally and irrevocably, guaranty the punctual payment, as and when due
and payable, by stated maturity or otherwise, of all Obligations (as defined in
the Security Agreement) of the Company from time to time owing by it in respect
of the Securities Purchase Agreement, the Notes and the other Transaction
Documents, including, without limitation, all interest that accrues after the
commencement of any Insolvency Proceeding (as defined in the Security Agreement)
of the Company or any Guarantor, whether or not the payment of such interest is
unenforceable or is not allowable due to the existence of such Insolvency
Proceeding, and all fees, commissions, expense reimbursements, indemnifications
and all other amounts due or to become due under any of the Transaction
Documents (such obligations, to the extent not paid by the Company, being the
“Guaranteed Obligations”), and agrees to pay any and all expenses (including
reasonable counsel fees and expenses) reasonably incurred by the Collateral
Agent in enforcing any rights under this Guaranty.  Without limiting the
generality of the foregoing, each Guarantor’s liability hereunder shall extend
to all amounts that constitute part of the Guaranteed Obligations and would be
owed by the Company to the Collateral Agent under the Securities Purchase
Agreement and the Notes but for the fact that they are unenforceable or not
allowable due to the existence of an Insolvency Proceeding involving any
Guarantor or the Company (each, a “Transaction Party”).  Each Guarantor agrees
that this Guaranty is a guaranty of payment and performance and not of
collection.
 
SECTION 3. Guaranty Absolute; Continuing Guaranty; Assignments.
 
(a) The Guarantors, jointly and severally, guaranty that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the
Transaction Documents, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of the Collateral Agent with respect thereto.  The obligations of each
Guarantor under this Guaranty are independent of the Guaranteed Obligations, and
a separate action or actions may be brought and prosecuted against any Guarantor
to enforce such obligations, irrespective of whether any action is brought
against any Transaction Party or whether any Transaction Party is joined in any
such action or actions.  The liability of any Guarantor under this Guaranty
shall be irrevocable, absolute and unconditional irrespective of, and each
Guarantor hereby irrevocably waives, to the extent permitted by law, any
defenses it may now or hereafter have in any way relating to, any or all of the
following:
 
(i) any lack of validity or enforceability of any Transaction Document or any
agreement or instrument relating thereto;
 
(ii) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Guaranteed Obligations, or any other amendment or waiver
of or any consent to departure from any Transaction Document, including, without
limitation, any increase in the Guaranteed Obligations resulting from the
extension of additional credit to any Transaction Party or otherwise;
 
(iii) any taking, exchange, release or non-perfection of any Collateral (as
defined in the Security Agreement), or any taking, release or amendment or
waiver of or consent to departure from any other guaranty, for all or any of the
Guaranteed Obligations;
 
(iv) any change, restructuring or termination of the corporate, limited
liability company or partnership structure or existence of any Transaction
Party; or
 
 
- 2 -

--------------------------------------------------------------------------------

 
 
(v) any other circumstance (including any statute of limitations) or any
existence of or reliance on any representation by the Collateral Agent that
might otherwise constitute a defense available to, or a discharge of, any
Transaction Party or any other guarantor or surety.
 
This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Collateral Agent or any other Person upon
the insolvency, bankruptcy or reorganization of any Transaction Party or
otherwise, all as though such payment had not been made.
 
(b) This Guaranty is a continuing guaranty and shall (i) remain in full force
and effect until the indefeasible cash payment in full of the Guaranteed
Obligations in cash (other than inchoate indemnity obligations) and shall not
terminate for any reason prior to the respective Maturity Date of each Note
(other than payment in full of the Notes in cash) and (ii) be binding upon each
Guarantor and its respective successors and assigns.  This Guaranty shall inure
to the benefit of and be enforceable by the Collateral Agent and its successors,
and permitted pledgees, transferees and assigns.  Without limiting the
generality of the foregoing sentence, the Collateral Agent or any Purchaser may
pledge, assign or otherwise transfer all or any portion of its rights and
obligations under and subject to the terms of any Transaction Document to any
other Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Purchaser herein or otherwise, in
each case as provided in the Securities Purchase Agreement or such Transaction
Document.  Notwithstanding the foregoing and for the avoidance of doubt, this
Guaranty will expire and each Guarantor will be released from its obligation
hereunder upon payment in full of the Obligations.
 
SECTION 4. Waivers.  To the extent permitted by applicable law, each Guarantor
hereby waives promptness, diligence, notice of acceptance and any other notice
with respect to any of the Guaranteed Obligations and this Guaranty and any
requirement that the Collateral Agent exhaust any right or take any action
against any Transaction Party or any other Person or any Collateral.  Each
Guarantor acknowledges that it will receive direct and indirect benefits from
the financing arrangements contemplated herein and that the waiver set forth in
this Section 4 is knowingly made in contemplation of such benefits.  The
Guarantors hereby waive any right to revoke this Guaranty, and acknowledge that
this Guaranty is continuing in nature and applies to all Guaranteed Obligations,
whether existing now or in the future.
 
 
- 3 -

--------------------------------------------------------------------------------

 
 
SECTION 5. Subrogation.  No Guarantor may exercise any rights that it may now or
hereafter acquire against any Transaction Party or any other guarantor that
arise from the existence, payment, performance or enforcement of any Guarantor’s
obligations under this Guaranty, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification and any
right to participate in any claim or remedy of the  Collateral Agent against any
Transaction Party or any other guarantor or any Collateral, whether or not such
claim, remedy or right arises in equity or under contract, statute or common
law, including, without limitation, the right to take or receive from any
Transaction Party or any other guarantor, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or security solely
on account of such claim, remedy or right, unless and until all of the
Guaranteed Obligations (other than inchoate indemnity obligations) and all other
amounts payable under this Guaranty (other than inchoate indemnity obligations)
shall have indefeasibly been paid in full in cash.  If any amount shall be paid
to a Guarantor in violation of the immediately preceding sentence at any time
prior to the later of the payment in full in cash of the Guaranteed Obligations
and all other amounts payable under this Guaranty, such amount shall be held in
trust for the benefit of the Collateral Agent and shall forthwith be paid to the
Collateral Agent to be credited and applied to the Guaranteed Obligations and
all other amounts payable under this Guaranty, whether matured or unmatured, in
accordance with the terms of the Transaction Document, or to be held as
Collateral for any Guaranteed Obligations or other amounts payable under this
Guaranty thereafter arising.  If (a) any Guarantor shall make payment to the
Collateral Agent of all or any part of the Guaranteed Obligations, and (b) all
of the Guaranteed Obligations (other than inchoate indemnity obligations) and
all other amounts payable under this Guaranty (other than inchoate indemnity
obligations) shall indefeasibly be paid in full in cash, the Collateral Agent
will, at such Guarantor’s request and expense, execute and deliver to such
Guarantor appropriate documents, without recourse and without representation or
warranty, necessary to evidence the transfer by subrogation to such Guarantor of
an interest in the Guaranteed Obligations resulting from such payment by such
Guarantor.
 
SECTION 6. Representations, Warranties and Covenants.
 
(a) Each Guarantor hereby represents and warrants as of the date first written
above as follows:
 
(i) The Guarantor (A) is a corporation, limited liability company or limited
partnership duly organized, validly existing and in good standing under the laws
of the jurisdiction of its organization as set forth on the signature pages
hereto, (B) has all requisite corporate, limited liability company or limited
partnership power and authority to conduct its business as now conducted and as
presently contemplated and to execute and deliver this Guaranty and each other
Transaction Document to which the Guarantor is a party, and to consummate the
transactions contemplated hereby and thereby and (C) is duly qualified to do
business and is in good standing in each jurisdiction in which the character of
the properties owned or leased by it or in which the transaction of its business
makes such qualification necessary except where the failure to be so qualified
would not result in a Material Adverse Effect.
 
(ii) The execution, delivery and performance by the Guarantor of this Guaranty
and each other Transaction Document to which the Guarantor is a party (A) have
been duly authorized by all necessary corporate, limited liability company or
limited partnership action, (B) do not and will not contravene its charter or
by-laws, its limited liability company or operating agreement or its certificate
of partnership or partnership agreement, as applicable, or any applicable law or
any contractual restriction binding on the Guarantor or its properties do not
and will not result in or require the creation of any lien (other than pursuant
to any Transaction Document) upon or with respect to any of its properties, and
(C) do not and will not result in any default, noncompliance, suspension,
revocation, impairment, forfeiture or nonrenewal of any material permit,
license, authorization or approval applicable to it or its operations or any of
its properties.
 
 
- 4 -

--------------------------------------------------------------------------------

 
 
(iii) No authorization or approval or other action by, and no notice to or
filing with, any governmental authority is required in connection with the due
execution, delivery and performance by the Guarantor of this Guaranty or any of
the other Transaction Documents to which the Guarantor is a party (other than
expressly provided for in any of the Transaction Documents).
 
(iv) Each of this Guaranty and the other Transaction Documents to which the
Guarantor is or will be a party, when delivered, will be, a legal, valid and
binding obligation of the Guarantor, enforceable against the Guarantor in
accordance with its terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance, suretyship or
other similar laws and equitable principles (regardless of whether enforcement
is sought in equity or at law).
 
(v) There is no pending or, to the best knowledge of the Guarantor, threatened
action, suit or proceeding against the Guarantor or to which any of the
properties of the Guarantor is subject, before any court or other governmental
authority or any arbitrator that (A) if adversely determined, could reasonably
be expected to have a Material Adverse Effect or (B) relates to this Guaranty or
any of the other Transaction Documents to which the Guarantor is a party or any
transaction contemplated hereby or thereby.
 
(vi) The Guarantor (A) has read and understands the terms and conditions of the
Securities Purchase Agreement and the other Transaction Documents, and (B) now
has and will continue to have independent means of obtaining information
concerning the affairs, financial condition and business of the Company and the
other Transaction Parties, and has no need of, or right to obtain from any
Purchaser, any credit or other information concerning the affairs, financial
condition or business of the Company or the other Transaction Parties that may
come under the control of any Purchaser.
 
(b) The Guarantor covenants and agrees that until indefeasible full and final
payment in cash of the Guaranteed Obligations, it will comply with each of the
covenants (except to the extent applicable only to a public company) which are
set forth in Section 4 of the Securities Purchase Agreement as if the Guarantor
were a party thereto.
 
SECTION 7. Right of Set-off.  Upon the occurrence and during the continuance of
any Event of Default, any Purchaser may, and is hereby authorized to, at any
time and from time to time, without notice to the Guarantors (any such notice
being expressly waived by each Guarantor) and to the fullest extent permitted by
law, set-off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by any Purchaser to or for the credit or the account of any Guarantor against
any and all obligations of the Guarantors now or hereafter existing under this
Guaranty or any other Transaction Document, irrespective of whether or not any
Purchaser shall have made any demand under this Guaranty or any other
Transaction Document and although such obligations may be contingent or
unmatured.  Each Purchaser agrees to notify the relevant Guarantor promptly
after any such set-off and application made by such Purchaser, provided that the
failure to give such notice shall not affect the validity of such set-off and
application.  The rights of any Purchaser under this Section 7 are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) which such Purchaser may have under this Guaranty or any other
Transaction Document in law or otherwise.
 
 
- 5 -

--------------------------------------------------------------------------------

 
 
SECTION 8. Notices, Etc.  All notices and other communications provided for
hereunder shall be in writing and shall be mailed, telecopied or delivered, if
to any Guarantor, to it at its address set forth on the signature page hereto,
or if to the Collateral Agent or any Purchaser, to it at its respective address
set forth in the Securities Purchase Agreement; or as to any Person at such
other address as shall be designated by such Person in a written notice to such
other Person complying as to delivery with the terms of this Section 8.  All
such notices and other communications shall be effective (i) if mailed (by
certified mail, postage prepaid and return receipt requested), when received or
three Business Days after deposited in the mails, whichever occurs first; (ii)
if telecopied, when transmitted and confirmation is received, provided same is
on a Business Day and, if not, on the next Business Day; or (iii) if delivered
by hand, upon delivery, provided same is on a Business Day and, if not, on the
next Business Day.
 
SECTION 9. CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE.  ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS GUARANTY OR ANY OTHER TRANSACTION
DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK IN THE COUNTY OF
NEW YORK OR OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH GUARANTOR HEREBY
IRREVOCABLY ACCEPTS IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,
THE JURISDICTION OF THE AFORESAID COURTS.  EACH GUARANTOR HEREBY IRREVOCABLY
APPOINTS THE SECRETARY OF STATE OF THE STATE OF NEW YORK AS ITS AGENT FOR
SERVICE OF PROCESS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING AND FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS AND IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, AT ITS ADDRESS FOR NOTICES AS SET
FORTH ON THE SIGNATURE PAGE HERETO AND TO THE SECRETARY OF STATE OF THE STATE OF
NEW YORK, SUCH SERVICE TO BECOME EFFECTIVE TEN (10) DAYS AFTER SUCH
MAILING.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE COLLATERAL AGENT TO
SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL
PROCEEDINGS OR OTHERWISE PROCEED AGAINST EACH GUARANTOR IN ANY OTHER
JURISDICTION.  ANY GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE JURISDICTION OR LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.  TO THE EXTENT THAT ANY GUARANTOR HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, EACH GUARANTOR HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF
ITS OBLIGATIONS UNDER THIS GUARANTY AND THE OTHER TRANSACTION DOCUMENTS.
 
 
- 6 -

--------------------------------------------------------------------------------

 
 
SECTION 10. WAIVER OF JURY TRIAL, ETC.  EACH GUARANTOR HEREBY WAIVES ANY RIGHT
TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM CONCERNING ANY
RIGHTS UNDER THIS GUARANTY OR THE OTHER TRANSACTION DOCUMENTS, OR UNDER ANY
AMENDMENT, WAIVER, CONSENT, INSTRUMENT, DOCUMENT OR OTHER AGREEMENT DELIVERED OR
WHICH IN THE FUTURE MAY BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH, OR
ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION WITH THIS
GUARANTY OR THE OTHER TRANSACTION DOCUMENTS, AND AGREES THAT ANY SUCH ACTION,
PROCEEDING OR COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A
JURY.  EACH GUARANTOR CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR
ATTORNEY OF THE COLLATERAL AGENT OR ANY PURCHASER HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT ANY PURCHASER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING
OR COUNTERCLAIM, SEEK TO ENFORCE THE FOREGOING WAIVERS.  EACH GUARANTOR HEREBY
ACKNOWLEDGES THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE COLLATERAL
AGENT ENTERING INTO THIS AGREEMENT.
 
SECTION 11. Taxes.
 
(a) All payments made by any Guarantor hereunder or under any other Transaction
Document shall be made in accordance with the terms of the respective
Transaction Document and shall be made without set-off, counterclaim, deduction
or other defense.  All such payments shall be made free and clear of and without
deduction for any present or future taxes, levies, imposts, deductions, charges
or withholdings, and all liabilities with respect thereto, excluding taxes
imposed on the net income of any Purchaser by the jurisdiction in which such
Purchaser is organized or where it has its principal lending office (all such
nonexcluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities, collectively or individually, “Taxes”).  If any Guarantor shall be
required to deduct or to withhold any Taxes from or in respect of any amount
payable hereunder or under any other Transaction Document:
 
(i) the amount so payable shall be increased to the extent necessary so that
after making all required deductions and withholdings (including Taxes on
amounts payable to any Purchaser pursuant to this sentence) each Purchaser
receives an amount equal to the sum it would have received had no such deduction
or withholding been made,
 
(ii) such Guarantor shall make such deduction or withholding,
 
(iii) such Guarantor shall pay the full amount deducted or withheld to the
relevant taxation authority in accordance with applicable law, and
 
(iv) as promptly as possible thereafter, such Guarantor shall send the
Purchasers an official receipt (or, if an official receipt is not available,
such other documentation as shall be satisfactory to the Collateral Agent, as
the case may be) showing payment.  In addition, each Guarantor agrees to pay any
present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies that arise from any payment made hereunder or
from the execution, delivery, registration or enforcement of, or otherwise with
respect to, this Agreement or any other Transaction Document (collectively,
“Other Taxes”).
 
 
- 7 -

--------------------------------------------------------------------------------

 
 
(b) Each Guarantor hereby indemnifies and agrees to hold the Collateral Agent
and each Purchaser (each an “Indemnified Party”) harmless from and against Taxes
or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed
by any jurisdiction on amounts payable under this Section 11) paid by any
Indemnified Party  as a result of any payment made hereunder or from the
execution, delivery, registration or enforcement of, or otherwise with respect
to, this Agreement or any other Transaction Document, and any liability
(including penalties, interest and expenses for nonpayment, late payment or
otherwise) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted.  This indemnification shall
be paid within 30 days from the date on which the Collateral Agent or such
Purchaser makes written demand therefor, which demand shall identify the nature
and amount of such Taxes or Other Taxes.
 
(c) If any Guarantor fails to perform any of its obligations under this
Section 11, such Guarantor shall indemnify the Collateral Agent and each
Purchaser for any taxes, interest or penalties that may become payable as a
result of any such failure.  The obligations of the Guarantors under this
Section 11 shall survive the termination of this Guaranty and the payment of the
Obligations and all other amounts payable hereunder.
 
SECTION 12. Miscellaneous.
 
(a) Each Guarantor will make each payment hereunder in lawful money of the
United States of America and in immediately available funds to each Purchaser,
at such address specified by such Purchaser from time to time by notice to the
Guarantors.
 
(b) No amendment or waiver of any provision of this Guaranty and no consent to
any departure by any Guarantor therefrom shall in any event be effective unless
the same shall be in writing and signed by each Guarantor and each Purchaser,
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
 
(c) No failure on the part of any Purchaser to exercise, and no delay in
exercising, any right hereunder or under any other Transaction Document shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right hereunder or under any Transaction Document preclude any other or further
exercise thereof or the exercise of any other right.  The rights and remedies of
the Collateral Agent and the Purchasers provided herein and in the other
Transaction Documents are cumulative and are in addition to, and not exclusive
of, any rights or remedies provided by law.  The rights of the Collateral Agent
and the Purchasers under any Transaction Document against any party thereto are
not conditional or contingent on any attempt by the Collateral Agent or any
Purchaser to exercise any of their respective rights under any other Transaction
Document against such party or against any other Person.
 
(d) Any provision of this Guaranty that 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 portions
hereof or affecting the validity or enforceability of such provision in any
other jurisdiction.
 
 
- 8 -

--------------------------------------------------------------------------------

 
 
(e) This Guaranty shall (i) be binding on each Guarantor and its respective
successors and assigns, and (ii) inure, together with all rights and remedies of
the Collateral Agent hereunder, to the benefit of the Collateral Agent, the
Purchasers and their respective successors, transferees and assigns.  Without
limiting the generality of clause (ii) of the immediately preceding sentence,
the Collateral Agent and any Purchaser may assign or otherwise transfer its
rights and obligations under the Securities Purchase Agreement or any other
Transaction Document to any other Person in accordance with the terms thereof,
and such other Person shall thereupon become vested with all of the benefits in
respect thereof granted to the Collateral Agent or such Purchaser, as the case
may be, herein or otherwise.  None of the rights or obligations of any Guarantor
hereunder may be assigned or otherwise transferred without the prior written
consent of each Purchaser.
 
(f) This Guaranty reflects the entire understanding of the transaction
contemplated hereby and shall not be contradicted or qualified by any other
agreement, oral or written, entered into before the date hereof.
 
(g) Section headings herein are included for convenience of reference only and
shall not constitute a part of this Agreement for any other purpose.
 
(h) THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW
OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED
THEREIN WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
 
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
 
 
- 9 -

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be executed by
its respective duly authorized officer, as of the date first above written.
 

 
GUARANTORS:
          MAGLA INTERNATIONAL, INC.          
 
By:
/s/ Jordan Glatt
      Name :  Jordan Glatt       Title :          

 

  MAGLA WORLDWIDE LTD.          
 
By:
/s/ Jordan Glatt
      Name :  Jordan Glatt       Title :          

 
Guaranty
 
 
 

--------------------------------------------------------------------------------