Exhibit 10.41

GUARANTY

OF

SPECTRAL SOLUTIONS, INC.

     ISCO INTERNATIONAL INC., a corporation organized and existing under the
laws of Delaware and formerly known as Illinois Superconductor Corporation
(“ISCO”) and the corporate parent of SPECTRAL SOLUTIONS, INC., a corporation
organized and existing under the laws of the State of Colorado (“Guarantor”),
has issued to ELLIOTT ASSOCIATES, L.P., a limited partnership organized under
the laws of the State of Delaware and ALEXANDER FINANCE LP, an Illinois limited
partnership (collectively, “Payees”), 14% promissory notes due March 31, 2003,
in the aggregate principal amount of $9,425,000 (the “Notes”) pursuant to the
Note Purchase Agreement dated November 6, 2001 (the “Note Purchase Agreement”).

     Section 1. Guaranty.

     (a)   In consideration of Payees purchasing the Notes and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Guarantor hereby absolutely, irrevocably and unconditionally
guarantees to the Payees the full payment and performance when due of any and
all obligations and undertakings of ISCO under the Notes, the Note Purchase
Agreement and the Security Agreement (the “Security Agreement”) being entered
into pursuant to the Note Purchase Agreement (such obligations and undertakings
shall hereinafter be referred to as the “Obligations”), together with all
reasonable attorneys’ fees, disbursements and all other costs and expenses of
collections incurred by Payees in enforcing any of such Obligations and/or this
Guaranty.

     (b)   Notwithstanding the provisions of Section 1(a), the Guarantor’s
obligations hereunder shall not exceed the maximum amount that would not be
subject to avoidance under fraudulent conveyance, fraudulent transfer, and other
similar laws.

     Section 2. Certain Guarantor Waivers.

     (a)   Waivers of Notice, Etc. Guarantor waives notice of acceptance of this
Guaranty and notice of the creation or performance of any of the Obligations,
and waives presentment, demand of payment, protest or notice of protest, notice
of dishonor or nonperformance of any of the Obligations, suit or taking other
action or non-action by the Payees, ISCO or any other guarantor against, and any
other notice to, any party liable thereon (including, without limitation,
Guarantor). Guarantor also hereby waives any notice of default by ISCO and any
other notice to which Guarantor might otherwise be entitled, the right to
interpose any counterclaim or consolidate any other action with an action on
this Guaranty, and the benefit of any statute of limitations affecting its
liabilities hereunder or the enforcement hereof. No act or omission of any kind
in connection with any of the foregoing shall in any way impair or otherwise
affect the

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legality, validity, binding effect or enforceability of any term or provision of
this Guaranty or any of the obligations of Guarantor hereunder.

     (b)   Guaranty Not Affected. Guarantor hereby covenants, agrees and
consents that Payees may, at any time and from time to time (whether or not
after revocation or termination of this Guaranty), without incurring
responsibility to Guarantor, and without impairing or releasing any of the
obligations of Guarantor hereunder and, upon or without any terms or conditions,
and in whole or in part: (i) agree with ISCO to change the manner, place or
terms of performance, including (without limitation) any change or extend the
time of performance of, renew or alter, any of the Obligations, any security
therefor, or any other liability incurred directly or indirectly in respect
thereof, or to make any other change in the Obligations, and the guaranty herein
made shall apply to the Obligations as so changed, extended, renewed or altered;
(ii) take additional security, for or sell, exchange, release, surrender,
substitute, realize upon or otherwise deal with in any manner and in any order
any property by whomsoever at any time pledged or mortgaged to secure, or
howsoever securing, any of the Obligations or any other liabilities (including
any of those hereunder) incurred directly or indirectly in respect thereof or
hereof, and/or any offset thereagainst; (iii) exercise or refrain from
exercising any rights against ISCO or others (including, without limitation,
Guarantor) or otherwise act or refrain from acting; (iv) settle or compromise
any Obligation, any security therefor, or any liability (including any of those
hereunder) incurred directly or indirectly in respect thereof or hereof, and/or
subordinate the performance of all or any part thereof to the performance of any
of the Obligations (whether due or not) to creditors of ISCO other than Payees
and Guarantor; (v) apply any sums by whomsoever paid or howsoever realized to
any Obligation regardless of what Obligations remain unperformed; (vi) cancel,
compromise, modify, or waive the provisions of any document relating to any of
the Obligations; (vii) release any other guarantor or surety of the Obligations;
and (viii) grant ISCO any indulgence as Payees may, in its sole discretion,
determine.

     (c)   Failure to Perfect Lien, Etc. No failure by Payees to file, record or
otherwise perfect any lien or security interest, nor any improper filing or
recording, nor any failure by Payees to insure or protect any security nor any
other dealing (or failure to deal) with any security by Payees with respect to
any of the Obligations, shall impair or release any of the obligations of the
Guarantor hereunder. No invalidity, irregularity or unenforceability of all or
any part of the Obligations or of any security therefor shall affect, impair or
be a defense to this Guaranty, and this Guaranty is a primary obligation of
Guarantor.

     (d)   Waiver of Subrogation. No payment by Guarantor except the
indefeasible performance in full of the Obligations shall entitle Guarantor to
be subrogated to any of the rights of Payees. Guarantor shall have no right of
reimbursement or indemnity whatsoever and no right of recourse to or with
respect to any assets or property of ISCO or to any security for the
Obligations, unless and until all of the Obligations have been indefeasibly
performed in full, other than as such reimbursement or indemnity rights are
waived in the next paragraph below,

     (e)   Payment Guaranty; Waiver of Defenses, Counterclaims, Etc. Guarantor
hereby agrees that this Guaranty constitutes guaranty of payment, performance
and compliance (and not a guaranty of collection only), and waives any right to
require that any resort be had by Payees to ISCO or any other guarantor or to
any security pledged with respect to the performance of any of the Obligations.
Further, this guaranty of payment is absolute and unconditional, and shall

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remain valid, binding and fully enforceable irrespective of any circumstance of
any nature that might otherwise constitute a defense, offset, claim, abatement
or counterclaim that Guarantor or ISCO may assert against Payees with respect to
any of the Obligations or otherwise, including, but not limited to, failure of
consideration, fraudulent inducement, breach of warranty, payment, statute of
frauds, statute of limitations, accord and satisfaction, and usury, and
irrespective of the validity, legality, binding effect or enforceability of the
terms of any agreement or instrument relating to any of the Obligations.
Guarantor hereby absolutely, unconditionally and irrevocably waives any and all
rights to assert any such defenses, offsets, claims, abatements and
counterclaims. In the event Payees are not permitted or otherwise unable
(because of the pendency of any bankruptcy, insolvency, receivership or other
similar proceeding) to accelerate the Obligations but would otherwise be
permitted to do so at such time pursuant to the Purchase Agreement, Payees may
demand performance in full under this Guaranty as if all of the Obligations had
been duly accelerated, and Guarantor will not raise, and hereby expressly
waives, any claim or defense with respect to such acceleration.

     Section 3. Remedies. In the case of any proceedings to collect any
obligations of Guarantor, Guarantor shall pay all costs and expenses of every
kind for collection and enforcement of this Guaranty, including attorneys’ fees
and disbursements. Upon the occurrence and during the continuance of any failure
of any of the Obligations to be performed when due, the Payees may elect to
nonjudicially or judicially foreclose against any real or personal property
security it holds for the Obligations, or accept an assignment of any such
security in lieu of foreclosure or compromise or adjust any part of the
Obligations, or make any other accommodation with ISCO or any other guarantor,
pledgor or surety, or exercise any other remedy against ISCO or any other
guarantor, pledgor or surety, or any security, in accordance with and subject to
the provisions of the documents creating such security interests. No such action
by Payees will release, limit or otherwise affect the obligations of Guarantor
to Payees, even if the effect of that action is to deprive Guarantor of the
right to collect any reimbursement from ISCO or any other person for any sums
paid to Payees.

     Section 4. Reinstatement, Indemnification, Etc. If claim is ever made upon
Payees for repayment, return, restoration or other recovery of any amount or
amounts received by Payees in payment or on account of any of the Obligations,
and Payees repay all or part of such amount: (a) because such payment or
application of proceeds is or may be avoided, invalidated, declared fraudulent,
set aside or determined to be void or voidable as a preferential transfer,
fraudulent conveyance, impermissible set off or a diversion of trust funds; or
(b) for any other reason, including (without limitation) by reason of (i) any
judgment, decree or order of any court or administrative body having
jurisdiction over Payees or any of their property, or (ii) any settlement or
compromise of any such claim effected by Payees with any such claimant
(including ISCO); then, and in such event, Guarantor agrees that any such
judgment, decree, order, settlement or compromise shall be binding upon
Guarantor, notwithstanding any revocation hereof or the cancellation of any
Notes or other instrument or document evidencing any of the Obligations and the
obligations of Guarantor hereunder shall continue to apply, or shall
automatically (and without further action) be reinstated if not then in effect,
as case may be, and Guarantor shall be and remain liable to Payees hereunder for
the amount so repaid or recovered to the same extent as if such amount had never
originally been received by Payees. Guarantor hereby indemnifies Payees, and
agrees to reimburse and hold Payees harmless on demand, from and against all
actions, claims, losses, judgments, damages, amounts paid in

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settlement and expenses (including reasonable attorneys’ fees and court costs)
brought against or incurred by Payees and arising out of, relating to or in
connection with any of the Obligations.

     Section 5. Waiver of Rights, Etc. No delay on the part of Payees in
exercising any of their options, powers or rights, or partial or single exercise
thereof, shall constitute a waiver thereof. No waiver of any of their rights
hereunder, and no modification or amendment of this Guaranty, shall be deemed to
be made by Payees unless the same shall be in writing, duly signed by an officer
of each Payee on behalf of such Payee, and each such waiver, if any, shall apply
only with respect to the specific instance involved, and shall in no way impair
the rights of Payees or the obligations of Guarantor to Payees in any other
respect at any other time.

     Section 6. Enforcement, Etc. Payees, in their sole discretion, may proceed
to exercise or enforce any right, power, privilege, remedy or interest that
Payees may have under this Guaranty, the Obligations or any applicable law: at
law, in equity, in rem or in any other forum available under applicable law;
without notice except as otherwise expressly required by law provided herein;
without pursuing, exhausting or otherwise exercising or enforcing any other
right, power, privilege, remedy or interest that Payees may have against or in
respect of Guarantor, the Obligations, ISCO, any other guarantor, surety,
pledgor, collateral or any other person or thing; and without regard to any act
or omission of Payees or any other person.

     Section 7. Reliance. Guarantor expressly acknowledges that Guarantor has
not received or relied upon any oral or written agreements, understandings,
representations or warranties from Payees or any other party with respect to
this Guaranty (or any of Guarantor’s obligations hereunder), and that this
Guaranty contains the entire understanding of the parties with respect to the
subject matter hereof and supersedes and replaces any and all prior oral or
written agreements and understandings with respect thereto.

     Section 8. Representations, Warranties and Agreements of the Guarantor. The
Guarantor hereby makes the following representations and warranties to Payees as
of the date hereof:

     (a)   Organization and Qualification. The Guarantor is a corporation, duly
incorporated, validly existing and in good standing under the laws of the State
of Colorado, 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. 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

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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 Certificate of Incorporation or By-laws or (ii)
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 govern-mental 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.

     (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 or other govern-mental authority
or other person in connection with the execution, delivery and performance by
the Guarantor of this Guaranty.

     Section 9. Successors and Assigns. This Guaranty is binding upon the
Guarantor and its successors or assigns, and shall inure to the benefit of
Payees and their respective successors and assigns.

     Section 10. Modification, Etc. This Guaranty cannot be terminated or
changed orally and no provision hereof may be modified or waived except in
writing by the holders of 75% of the outstanding principal amount of the Notes.

     Section 11. Section and Other Headings. The Sections and other headings
contained in this Guaranty are for reference purposes only and shall not affect
the Meaning or interpretation of this Guaranty.

     Section 12. Governing Law. THIS GUARANTY AND THE RIGHTS OF PAYEES AND THE
OBLIGATIONS OF GUARANTOR HEREUNDER SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE -STATE OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF
CONFLICTS OF LAW OR CHOICE 0-LAW.

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     Section 13. Severability. In the event that any term or provision of this
Guaranty shall be finally determined to be superseded, invalid, illegal or
otherwise unenforceable pursuant to applicable law by a governmental authority
having jurisdiction and venue, that determination shall not impair or otherwise
affect the validity, legality or enforceability (a) by or before that authority
of the remaining terms and provisions of this Guaranty, which shall be enforced
as if the unenforceable term or provision were deleted, or (b) by or before any
other authority of any of the terms and provisions of the Guaranty.

     Section 14. Consent to Jurisdiction. Guarantor hereby irrevocably submits
to the exclusive jurisdiction and venue of any New York state and federal court
located in New York County, New York, over any action or proceeding arising out
of any dispute between Guarantor and Payees, and Guarantor further irrevocably
consents To the service of any process in any such action or proceeding by the
mailing of a copy of such process to Guarantor at the address set forth below.

     Section 15. Waiver of Jury Trial, Inconvenient Forum. GUARANTOR AND, BY
ACCEPTING THIS GUARANTY, PAYEES, HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE ANY RIGHT EACH MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
ARISING OUT OF) UNDER OR IN CONNECTION WITH THIS GUARANTY, OR THE TRANSACTIONS
CONTEMPLATED HEREBY, AND ANY RIGHT TO OBJECT TO INCONVENIENT FORUM OR IMPROPER
VENUE IN NEW YORK COUNTY, NEW YORK. GUARANTOR HEREBY CERTIFIES THAT NO
REPRESENTATIVE OR AGENT OF PAYEES NOR PAYEES’ COUNSEL HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT PAYEES WOULD NOT, IN THE

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EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL.
GUARANTOR ALSO ACKNOWLEDGES THAT PAYEES HAS BEEN INDUCED TO ACCEPT THIS GUARANTY
BY, AMONG OTHER THINGS , THE FOREGOING WAIVER OF TRIAL BY JURY.

Dated the 6th day of November, 2001

SPECTRAL SOLUTIONS, INC.

 

By: /s/ Charles F. Willes

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