Exhibit 10.7
Execution Copy
GUARANTY
This GUARANTY AGREEMENT ("Agreement"), dated as of June
, 2008 is made by
each of the undersigned (each a "Guarantor", and collectively, the
"Guarantors"), in favor of YA GLOBAL INVESTMENTS, L.P. (the "Secured Party").
WHEREAS, in connection with the Securities Purchase Agreement by and among
Isonics Corporation, a California corporation (the "Company") and the Secured
Party of even date herewith (the "Securities Purchase Agreement"), the Company
has agreed, upon the terms and subject to the conditions of the Securities
Purchase Agreement, to issue to the Secured Party (i) an aggregate original
principal amount of $1,175,000 notes (the "Notes"); and (ii) warrants (the
"Warrants") to be exercisable to acquire additional shares of the Company's
common stock ("Common Stock"), no par value per share (the "Warrants Shares")
initially in that number of shares of Common Stock set forth in the Securities
Purchase Agreement;
WHEREAS, each of the Guarantors is executing and delivering a Security Agreement
dated the date hereof (the "Security Agreement") granting a lien in all of the
Pledged Property (as defined in the Security Agreement) to the Secured Party;
WHEREAS, it is a condition precedent to the Secured Party purchasing the Notes
and Warrants pursuant to the Securities Purchase Agreement that the Guarantors
shall have executed and delivered to the Secured Party this Agreement
guaranteeing all of the obligations of the Company under the Transaction
Documents (as defined in the Securities Purchase Agreement, the "Transaction
Documents";
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 Secured Party to perform under the Securities Purchase
Agreement, each Guarantor hereby agrees with the Secured Party as follows:
SECTION 1.
DEFINITIONS.
REFERENCE IS HEREBY MADE TO THE SECURITIES PURCHASE
AGREEMENT AND THE NOTES ISSUED PURSUANT THERETO 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 TO THE
SECURED PARTY (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 SECURED PARTY
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 SECURED PARTY BUT FOR THE
FACT THAT THEY ARE UNENFORCEABLE OR NOT ALLOWABLE DUE TO THE EXISTENCE