Unassociated Document


    GUARANTY

     

    GUARANTY
      (the
      “Guaranty”), dated as of September 26, 2007, by
      Duska
      Scientific Co., a Delaware corporation with an address of Duska Therapeutics,
      Inc., Two Bala Plaza, Suite 300, Bala Cynwyd, PA (the
      “Guarantor”), in favor of the Purchasers identified in the Purchase Agreement
      (as defined below) (collectively, “Secured Parties”). 

    


    WHEREAS,
      the Guarantor is a subsidiary or affiliate of Duska Therapeutics,
      Inc.
      (the
“Borrower”);
      and

    


    WHEREAS,
      in accordance with a certain senior secured convertible note, dated as of the
      date hereof (the “Notes”), executed by the Borrower, and certain related
      agreements between the Borrower and the Secured Parties (collectively, as
      amended, restated, or extended from time to time, the “Loan Documents”), the
      Secured Parties have agreed to loan to the Borrower up to Six Million Five
      Hundred Thousand Dollars ($6,500,000) (the “Loan”); and

    


    WHEREAS,
      the Secured Parties’ willingness to extend the loan is conditioned upon the
      Guarantor executing and delivering this Guaranty; and

    


    WHEREAS,
      the aforesaid Loan will be beneficial to the Guarantor inasmuch as the proceeds
      of the Loan to the Borrower will indirectly benefit the Guarantor;

    


    NOW,
      THEREFORE, in order to induce the Secured Parties to make the Loan to the
      Borrower pursuant to the Loan Documents, and for other good and valuable
      consideration, the receipt and sufficiency of which is hereby acknowledged
      by
      the Guarantor, the Guarantor hereby agrees as follows:

    


    1.
       Guaranty
      of Payment and Performance. The
      Guarantor hereby guarantees to the Secured Parties the full and punctual payment
      when due (whether at maturity, by acceleration or otherwise), and the
      performance, of all liabilities, agreements and other obligations of the
      Borrower to the Secured Parties, whether direct or indirect, absolute or
      contingent, due or to become due, secured or unsecured, now existing or
      hereafter arising or acquired (whether by way of discount, letter of credit,
      lease, loan, overdraft or otherwise), including without limitation all
      obligations under the Note (collectively, the “Obligations”). This Guaranty is
      an absolute, unconditional and continuing guaranty of the full and punctual
      payment and performance of the Obligations and not of their collectibility
      only
      and is in no way conditioned upon any requirement that the Secured Parties
      first
      attempt to collect any of the Obligations from the Borrower or resort to any
      security or other means of obtaining their payment. Should the Borrower default
      in the payment or performance of any of the Obligations, the obligations of
      the
      Guarantor hereunder shall become immediately due and payable to the Secured
      Parties, without demand or notice of any nature, all of which are expressly
      waived by the Guarantor. Payments by the Guarantor hereunder may be required
      by
      the Secured Parties on any number of occasions. 

    


    2.
       Guarantor’s
      Agreement to Pay. The
      Guarantor further agrees, as the principal obligor and not as a guarantor only,
      to pay to the Secured Parties, on demand, all reasonable costs and expenses
      (including court costs and reasonable legal expenses) incurred or expended
      by
      the Secured Parties in connection with enforcement of this Guaranty, together
      with interest on amounts recoverable under this Guaranty from the time such
      amounts become due under this Guaranty until payment, at the rate per annum
      equal to the default rate set forth in the Note; provided that if such interest
      exceeds the maximum amount permitted to be paid under applicable law, then
      such
      interest shall be reduced to such maximum permitted amount.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    3. Unlimited
      Guaranty. The
      liability of the Guarantor hereunder shall be unlimited to the extent of the
      Obligations and the other obligations of the Guarantor hereunder (including,
      without limitation, under Section 2 above). 

    


    4. Waivers
      by Guarantor; Secured Party’s Freedom to Act. The
      Guarantor agrees that the Obligations will be paid and performed strictly in
      accordance with their respective terms 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 Secured Parties with respect thereto. The Guarantor waives
      presentment, demand, protest, notice of acceptance, notice of Obligations
      incurred and all other notices of any kind, all defenses which may be available
      to Borrower by virtue of any valuation, stay, moratorium law or other similar
      law now or hereafter in effect, any right to require the marshalling of assets
      of the Borrower, and all suretyship defenses generally. Without limiting the
      generality of the foregoing, the Guarantor agrees to the provisions of any
      instrument evidencing, securing or otherwise executed in connection with any
      Obligation and agrees that the obligations of the Guarantor hereunder shall
      not
      be released or discharged, in whole or in part, or otherwise affected by
      (i) the
      failure of any Secured Party to assert any claim or demand or to enforce any
      right or remedy against the Borrower; (ii) any
      extensions or renewals of any Obligation; (iii) any
      rescissions, waivers, amendments or modifications of any of the terms or
      provisions of any agreement evidencing, securing or otherwise executed in
      connection with any Obligation (provided, that, the obligations of the Guarantor
      hereunder shall be appropriately modified to reflect any amendment or
      modification of the Obligations); (iv) the
      substitution or release of any entity primarily or secondarily liable for any
      Obligation; (v) the
      adequacy of any rights any Secured Party may have against any collateral or
      other means of obtaining repayment of the Obligations; (vi) the
      impairment of any collateral securing the Obligations, including without
      limitation the failure to perfect or preserve any rights a Secured Party might
      have in such collateral or the substitution, exchange, surrender, release,
      loss
      or destruction of any such collateral; or (vii) any
      other act or omission which might in any manner or to any extent vary the risk
      of the Guarantor or otherwise operate as a release or discharge of any other
      guarantor, all of which may be done without notice to the
      Guarantor.

    


    5. Unenforceability
      of Obligations Against Borrower.
      If for
      any reason the Borrower has no legal existence or is under no legal obligation
      to discharge any of the Obligations, or if any of the Obligations have become
      irrecoverable from the Borrower by operation of law or for any other reason,
      this Guaranty shall nevertheless be binding on the Guarantor to the same extent
      as if the Guarantor at all times had been the principal obligor on all such
      Obligations. In the event that acceleration of the time for payment of the
      Obligations is stayed upon the insolvency, bankruptcy or reorganization of
      the
      Borrower, or for any other reason, all such amounts otherwise subject to
      acceleration under the terms of any agreement evidencing, securing or otherwise
      executed in connection with any Obligation shall be immediately due and payable
      by the Guarantor.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    6. Subrogation;
      Subordination.
      Until
      the payment and performance in full of all Obligations, the Guarantor shall
      not
      exercise any rights against the Borrower arising as a result of payment by
      any
      Guarantor hereunder, by way of subrogation or otherwise, and will not prove
      any
      claim in competition with any Secured Party or its affiliates in respect of
      any
      payment hereunder in bankruptcy or insolvency proceedings of any nature; the
      Guarantor will not claim any set-off or counterclaim against the Borrower in
      respect of any liability of the Guarantor to the Borrower; and the Guarantor
      waives any benefit of and any right to participate in any collateral which
      may
      be held by any Secured Party. The payment of any amounts due with respect to
      any
      indebtedness of the Borrower now or hereafter held by the Guarantor is hereby
      subordinated to the prior payment in full of the Obligations. The Guarantor
      agrees that after the occurrence of any default in the payment or performance
      of
      the Obligations, after the expiration of any applicable cure period, it will
      not
      demand, sue for or otherwise attempt to collect after such time any such
      indebtedness of the Borrower to the Guarantor until the Obligations shall have
      been paid in full. If, notwithstanding the foregoing sentence, the Guarantor
      shall collect, enforce or receive any amounts in respect of such indebtedness,
      such amounts shall be collected, enforced and received by the Guarantor as
      trustee for the Secured Parties and be paid over to the Secured Parties on
      account of the Obligations without affecting in any manner the liability of
      the
      Guarantor under the other provisions of this Guaranty.

    


    7. Further
      Assurances.
      The
      Guarantor agrees to do all such things and execute all such documents, as a
      Secured Party may consider reasonably necessary or desirable to give full effect
      to this Guaranty and to perfect and preserve the rights and powers of a Secured
      Party hereunder.

    


    8. Termination;
      Reinstatement.
      This
      Guaranty shall remain in full force and effect until the earlier of: (i) the
      Obligations are paid in full or otherwise satisfied (including by the conversion
      in full of the Notes) (other than contingent indemnity obligations), and not
      subject to any recapture or preference in bankruptcy or similar proceedings,
      and
      the Secured Parties have no further commitment to extent credit to the Borrower
      or (ii) the Secured Parties are given written notice of the Guarantor’s
      intention to discontinue this Guaranty, notwithstanding any intermediate or
      temporary payment or settlement of the whole or any part of the Obligations.
      No
      such notice under (ii) above shall be effective against a Secured Party unless
      received and acknowledged by an officer of a Secured Party at its head office.
      Without limiting the generality of the foregoing sentence, the Guarantor will
      be
      released from all liability hereunder concurrently with either the repayment
      of
      in full of all amounts owed under the Notes or the conversion in full of the
      Notes. No notice under (ii) above shall affect any rights of a Secured Party
      or
      of any affiliate hereunder with respect to any Obligations incurred prior to
      such notice. This Guaranty shall continue to be effective or be reinstated,
      notwithstanding any notice or termination, if at any time any payment made
      or
      value received with respect to an Obligation is rescinded or must otherwise
      be
      returned by a Secured Party upon the insolvency, bankruptcy or reorganization
      of
      the Borrower, or otherwise, all as though such payment had not been made or
      value received. 

    


    9. Successors
      and Assigns.
      This
      Guaranty shall be jointly and severally binding upon the Guarantor, its
      successors and assigns, and shall inure to the benefit of and be enforceable
      by
      the Secured Parties and their successors, transferees and assigns. Without
      limiting the generality of the foregoing sentence, the Secured Parties may
      assign or otherwise transfer any agreement or any note held by it evidencing,
      securing or otherwise executed in connection with the Obligations, or sell
      participations in any interest therein, to any other person or entity, and
      such
      other person or entity shall thereupon become vested, to the extent set forth
      in
      the agreement evidencing such assignment, transfer or participation, with all
      the rights in respect thereof granted to the Secured Parties
      herein.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    10. Amendments
      and Waivers.
      No
      amendment or waiver of any provision of this Guaranty nor consent to any
      departure by the Guarantor therefrom shall be effective unless the same shall
      be
      in writing and signed by the Secured Parties holding a majority of the principal
      amount of the Notes. No failure on the part of a Secured Party to exercise,
      and
      no delay in exercising, any right hereunder shall operate as a waiver thereof;
      nor shall any single or partial exercise of any right hereunder preclude any
      other or further exercise thereof or the exercise of any other
      right.

    


    11. Notices.
      All
      notices and other communications called for hereunder shall be made in writing
      and, unless otherwise specifically provided herein, shall be deemed to have
      been
      duly made or given when delivered by hand or mailed first class mail postage
      prepaid or, in the case of telegraphic or telexed notice, when transmitted,
      answer back received, addressed as follows: if to the Guarantor, at the address
      set forth above, and if to a Secured Party, at the address set forth in the
      Purchase Agreement (as defined in the Note).

    


    12. Governing
      Law; Consent to Jurisdiction.
      This
      Guaranty shall be governed by, and construed in accordance with, the laws of
      the
      State of New York without reference to its conflicts of laws provisions. The
      Guarantor agrees that any suit for the enforcement of this Guaranty may be
      brought in the courts of the State of New York or any federal court sitting
      therein and consents to the non-exclusive jurisdiction of such court and to
      service of process in any such suit being made upon the Guarantor by mail at
      the
      address specified in Section 11 hereof. The Guarantor hereby waives any
      objection that it may now or hereafter have to the venue of any such suit or
      any
      such court or that such suit was brought in an inconvenient court. Any
      enforcement action relating to this Guarantee may be brought by motion for
      summary judgment in lieu of a complaint pursuant to Section 3213 of the New
      York
      Civil Practice Law and Rules.

    


    13. WAIVER
      OF JURY TRIAL. THE GUARANTOR AND, BY THEIR ACCEPTANCE OF THIS GUARANTY, EACH
      SECURED PARTY, HEREBY WAIVES TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH
      RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF: (A) THIS GUARANTY OR ANY
      OTHER INSTRUMENT OR DOCUMENT DELIVERED IN CONNECTION WITH THE OBLIGATIONS;
      (B) THE VALIDITY, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF; OR
      (C) ANY OTHER CLAIM OR DISPUTE HOWEVER ARISING BETWEEN THE GUARANTOR AND
      ANY SECURED PARTY.

    


    14. Certain
      References.
      All
      pronouns and any variations thereof shall be deemed to refer to the masculine,
      feminine, neuter, singular or plural, as the identity of the person, persons,
      entity or entities may require. The terms “herein”, “hereof” or “hereunder” or
      similar terms used in this Guaranty refer to this entire Guaranty and not only
      to the particular provision in which the term is used.

    
 

    15. Miscellaneous.
      This
      Guaranty, together with the Security Agreement, delivered by the Guarantor
      as of
      the date hereof to the Secured Parties, constitutes the entire agreement of
      the
      Guarantor with respect to the matters set forth herein. The rights and remedies
      herein provided are cumulative and not exclusive of any remedies provided by
      law
      or any other agreement, and this Guaranty shall be in addition to any other
      guaranty of the Obligations. The invalidity or unenforceability of any one
      or
      more sections of this Guaranty shall not affect the validity or enforceability
      of its remaining provisions. Captions are for the ease of reference only and
      shall not affect the meaning of the relevant provisions. The meanings of all
      defined terms used in this Guaranty shall be equally applicable to the singular
      and plural, masculine, feminine and generic forms of the terms defined.


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF,
      the
      Guarantor has caused this Guaranty to be executed and delivered as of the date
      appearing in the introductory paragraph of this Guaranty.

     

    
      	
              DUSKA
                SCIENTIFIC CO.

            	 
	 	 
	
              By:

            	/s/
              Amir Pelleg    
	 
	 	
              Name:
                Amir Pelleg 

              Title:
                President