Document:

<PAGE>   1
                                                                    EXHIBIT 10.2

                                     SECURED

                                 PROMISSORY NOTE

$539,117                                                        October 18, 1999

         FOR VALUE RECEIVED, Oakhurst Technology, Inc., a corporation organized
under the laws of the State of Delaware (the "Maker"), hereby promises to pay to
the order of Robert Davies (the "Holder"), having an address at 100 First
Stamford Place, Suite 600, Stamford, Connecticut 06902, or his assigns, the
principal sum of Five Hundred Thirty Nine Thousand and One Hundred and Seventeen
Dollars ($539,117), together with interest on the unpaid principal balance of
this Note payable quarterly at the rate of 14% per year (computed on the basis
of the actual number of days elapsed in a 360-day year). Quarterly interest
payments shall commence on January 18, 2000 and continue until this Note is paid
in full. All principal and accrued but unpaid interest shall be paid to the
Holder on October 18, 2000. All payments shall be made in immediately available
funds.

         All payments by the Maker under this Note shall be made without
set-off, defense or counterclaim and be free and clear and without any deduction
or withholding for any taxes or fees of any nature whatever, unless the
obligation to make such deduction or withholding is imposed by law.

         The Maker agrees that: (i) upon the failure to pay when due the
principal and accrued interest hereunder; (ii) if the Maker (1) commences any
voluntary proceeding under any provision of Title 11 of the United States Code,
as now or hereafter amended, or commences any other proceeding, under any law,
now or hereafter in force, relating to bankruptcy, insolvency, reorganization,
liquidation, or otherwise to the relief of debtors or the readjustment of
indebtedness, (2) makes any assignment for the benefit of creditors or a
composition or similar arrangement with such creditors, or (3) appoints a
receiver, trustee or similar judicial officer or agent to take charge of or
liquidate any of its property or assets; or (iii) upon the commencement against
the Maker of any involuntary proceeding of the kind described in clause (ii)
above (clauses (i), (ii) and (iii) each, an "Event of Default"), all unpaid
principal and accrued but unpaid interest under this Note shall become
immediately due and payable without presentment, demand, protest or notice of
any kind.

         The obligations of the Maker under this Note are secured by the pledge
of 17,524 shares of common stock, par value $0.01 per share, of Sterling
Construction Company to the Holder in accordance with the terms of the Stock
Pledge Agreement, dated as of the date hereof, between the Maker and the Holder
(the "Pledge Agreement"). The Maker shall remain liable for any deficiency if
the proceeds of any sale or other disposition of Collateral (as defined in the
Pledge Agreement) are insufficient to pay the obligations of the Maker
hereunder.

<PAGE>   2

         This Note may be prepaid at the option of the Maker, in whole or in
part, upon the refinancing in whole of the multiple advance term loan facility
of Oakhurst Company, Inc. ("OCI") pursuant to the Letter Loan Agreement, dated
December 29, 1998, between OCI and KTI, Inc., at any time after such refinancing
and from time to time thereafter, without penalty or premium. Any voluntary
prepayment of this Note shall be applied first to the payment of interest
accrued and unpaid on this Note and second to the payment of principal.

                  None of the terms or provisions of this Note may be excluded,
modified or amended except by a written instrument duly executed by the Holder
expressly referring to this Note and setting forth the provision so excluded,
modified or amended.

                  The Maker hereby forever waives presentment, demand,
presentment for payment, protest, notice of protest, notice of dishonor of this
Note and all other demands and notices in connection with the delivery,
acceptance, performance and enforcement of this Note.

                  This Note shall be governed and construed in accordance with
the laws of the State of Delaware applicable to agreements made and performed
entirely in such State, without regard to conflict of laws principles thereof,
and shall be binding upon the successors and assigns of the Maker and shall
inure to the benefit of the successors and assigns of the Holder.

                                               OAKHURST TECHNOLOGY, INC.

                                               By: /s/ Maarten D. Hemsley
                                                   Name: Maarten D. Hemsley
                                                   Title: President

                  FOR VALUE RECEIVED, the sufficiency of which is hereby
acknowledged, Oakhurst Company, Inc. (the "Guarantor") hereby absolutely,
unconditionally and irrevocably guarantees on a subordinated basis (the
"Guaranty") the full and punctual payment when due, whether at stated maturity,
by required prepayment, declaration, acceleration, demand or otherwise, of all
amounts due under this Note of the Maker, whether for principal, interest, fees,
expenses or otherwise (including all such amounts which would become due but for
the operation of the automatic stay under Section 362(a) of the United States
Bankruptcy Code, 11 U.S.C. ss. 362(a), and the operation of Sections 502(b) and
506(b) of the United States Bankruptcy Code, 11 U.S.C. ss. 502(b) and ss.
506(b)); provided, however, that the Guarantor shall be liable under this
Guaranty only for the maximum amount of such liability that can be hereby
incurred without rendering this Guaranty, as it relates to the Guarantor,
voidable under applicable law relating to fraudulent conveyance or fraudulent
transfer, and not for any greater amount. This Guaranty constitutes

<PAGE>   3

a guaranty of payment when due and not of collection, and the Guarantor
specifically agrees that it shall not be necessary or required that the Holder
exercise any right, assert any claim or demand or enforce any remedy whatsoever
against the Maker before or as a condition to the obligations of the Guarantor
hereunder.

         In case the Maker shall fail to punctually pay its obligations under
the Note in full when due, the Guarantor agrees to make such payment punctually
when and as the same shall become due and payable.
         The obligations of the Guarantor hereunder are independent of the
obligations of the Maker, and a separate action or actions may be brought and
prosecuted against the Guarantor, regardless of whether action is brought
against the Maker or whether the Maker is joined in any such action or actions.

                  The Guarantor agrees that its obligations under this Guaranty
are absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of this Note, or any substitution,
release or exchange of any other guaranty of or security for the Note, and, to
the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever (including, without limitation, personal defenses of the
Maker) which might otherwise constitute a legal or equitable discharge or
defense of a surety, guarantor or co-obligor, it being the intent that the
obligations of the Guarantor hereunder shall be absolute and unconditional under
any and all circumstances.

                  With respect to its obligations hereunder, the Guarantor
hereby expressly waives diligence, presentment, demand of payment, protest and
all notices whatsoever, and any requirement that the Holder exhaust any right,
power or remedy or proceed against any person under the Note, or against any
other person under any other guaranty of, or security for, or obligation
relating to, the Note.

                  The obligations of the Guarantor under this Guaranty shall be
automatically reinstated if and to the extent that for any reason any payment or
performance by or on behalf of any person in respect of the Maker's obligations
under this Note is rescinded or must be otherwise restored by any holder of any
of the Maker's obligations under this Note, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, and the Guarantor
agrees that it will pay to the Holder on demand all reasonable out-of-pocket
costs and expenses (including, without limitation, fees of counsel) incurred by
the Holder in connection with such rescission or restoration, including any such
costs and expenses incurred in defending against any claim alleging that such
payment constituted a preference, fraudulent transfer or similar payment under
any bankruptcy, insolvency or similar law.

                  The Maker and the Holder agree that the indebtedness evidenced
by this Note is subordinated in right of payment, to the extent and in the
manner provided herein, to the prior payment in full of all Senior Obligations
(whether outstanding on the date hereof or hereafter created, incurred, assumed
or guaranteed), and that the subordination is for the benefit of the holders of
Senior Obligations.

<PAGE>   4

                  Upon any payment or distribution of assets of the Guarantor of
any kind or character, whether in cash, property or securities, to creditors in
any Insolvency or Liquidation Proceeding with respect to the Guarantor, all
amounts due or to become due under or with respect to all Senior Obligations
shall first be paid indefeasibly in full in cash before any payment is made on
account of this Guaranty. Upon any such Insolvency or Liquidation Proceeding,
any payment or distribution of assets of the Guarantor of any kind or character,
whether in cash, property or securities, to which the Holder would be entitled
shall be paid by the Guarantor or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other person making such payment or distribution,
or by the Holder if received by it, directly to the holders of Senior
Obligations (pro rata to such holders on the basis of the amounts of Senior
Obligations held by such holders) or their Representative, as their interests
may appear, for application to the payment of the Senior Obligations remaining
unpaid until all such Senior Obligations have been paid indefeasibly in full in
cash, after giving effect to any concurrent payment, distribution or provision
therefor to or for the holders of Senior Obligations.

                  (a) In the event of and during the continuation of any default
in the payment of principal of, interest or premium, if any, on any Senior
Obligations, or in the event that any event of default (other than a payment
default) with respect to any Senior Obligations shall have occurred and be
continuing and shall have resulted in such Senior Obligation becoming or being
declared due and payable prior to the date on which it would otherwise have
become due and payable, or (b) if any event of default other than as described
in clause (a) above with respect to any Senior Obligations shall have occurred
and be continuing permitting the holders of such Senior Obligations (or their
Representative or Representatives) to declare such Senior Obligations due and
payable prior to the date on which it would otherwise have become due and
payable, then no payment shall be made by or on behalf of the Guarantor on
account of this Guaranty, unless and until such default shall have been cured or
waived in writing in accordance with the instruments governing such Senior
Obligations or such acceleration shall have been rescinded or annulled.

                  In the event that the Holder receives any payment with respect
to this Guaranty at a time when such payment is prohibited by the provisions
hereof, such payment shall be held by the Holder, in trust for the benefit of,
and shall be paid forthwith over and delivered, upon written request, to, the
holders of Senior Obligations as their interests may appear or their
Representative under the agreements (if any) pursuant to which Senior
Obligations may have been issued, as their respective interests may appear, for
application to the payment of all Obligations with respect to Senior Obligations
remaining unpaid to the extent necessary to pay such Obligations in full in
accordance with their terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Obligations.

<PAGE>   5

                  After all Senior Obligations are paid in full and until this
Guaranty is paid in full, the Holder shall be subrogated (equally and ratably
with all other Pari Passu Debt) to the rights of holders of Senior Obligations
to receive distributions applicable to Senior Obligations to the extent that
distributions otherwise payable to the Holder have been applied to the payment
of Senior Obligations. A distribution made under this Guaranty to holders of
Senior Obligations that otherwise would have been made to the Holder is not, as
between the Guarantor and the Holder, a payment by the Guarantor on this
Guaranty.

                  The "Subordination" section of this Guaranty defines the
relative rights of the Holder and holders of Senior Obligations. Nothing in this
Guaranty shall impair, as between the Guarantor and the Holder, the obligations
of the Guarantor, which are absolute and unconditional, to pay principal of and
interest on this Guaranty in accordance with its terms or affect the relative
rights of the Holder and creditors of the Guarantor other than their rights in
relation to holders of Senior Obligations.

                  No right of any holder of Senior Obligations to enforce the
subordination of the indebtedness evidenced by this Guaranty shall be impaired
by any act or failure to act by the Guarantor or the Holder or by the failure of
the Guarantor or the Holder to comply with this Guaranty.

                  Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Obligations, or any of them, may, at any time
and from time to time, without the consent of or notice to the Holder, without
incurring any liabilities to the Holder and without impairing or releasing the
subordination and other benefits provided in this Guaranty or the obligations of
the Holder to the holders of the Senior Obligations, even if any right of
reimbursement or subrogation or other right or remedy of the Holder is affected,
impaired or extinguished thereby, take any action with respect to the Senior
Obligations, including, without limitation, any one or more of the following:

                  (1) change the manner, place or terms of payment or change or
      extend the time of payment of, or renew, exchange, amend, increase or
      alter, the terms of any Senior Obligations, any security therefor or
      guaranty thereof or any liability of any obligor thereon (including any
      guarantor) to such holder, or any liability incurred directly or
      indirectly in respect thereof or otherwise amend, renew, exchange, extend,
      modify, increase or supplement in any manner any Senior Obligations or any
      instrument evidencing or guaranteeing or securing the same or any
      agreement under which Senior Obligations are outstanding;

                  (2) sell, exchange, release, surrender, realize upon, enforce
      or otherwise deal with in any manner and in any order any property
      pledged, mortgaged or otherwise securing Senior Obligations or any
      liability of any obligor thereon, to such holder, or any liability
      incurred directly or indirectly in respect thereof;

<PAGE>   6

                  (3) settle or compromise any Senior Obligations or any other
      liability of any obligor of the Senior Obligations to such holder or any
      security therefor or any liability incurred directly or indirectly in
      respect thereof and apply any sums by whomsoever paid and however realized
      to any liability (including, without limitation, Senior Obligations) in
      any manner or order; and

                  (4) fail to take or to record or to otherwise perfect, for any
      reason or for no reason, any lien or security interest securing Senior
      Obligations by whomsoever granted, exercise or delay in or refrain from
      exercising any right or remedy against any obligor or any guarantor or any
      other person, elect any remedy and otherwise deal freely with any obligor
      and any security for the Senior Obligations or any liability of any
      obligor to such holder or any liability incurred directly or indirectly in
      respect thereof.

                  Whenever a distribution is to be made or a notice given to
holders of Senior Obligations, the distribution may be made and the notice given
to their Representative. Upon any payment or distribution of assets of the
Guarantor referred to in the "Subordination" section of this Guaranty, the
Holder shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction or upon any certificate of such Representative or of the
liquidating trustee or agent or other person making any distribution to the
Holder for the purpose of ascertaining the persons entitled to participate in
such distribution, the holders of the Senior Obligations and other indebtedness
of the Guarantor, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent thereto or to the
"Subordination" section of this Guaranty.

                  "Insolvency or Liquidation Proceedings" means (i) any
voluntary or involuntary insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding,
relative to the Guarantor or to the creditors of the Guarantor, as such, or to
the assets of the Guarantor, or (ii) any liquidation, dissolution,
reorganization or winding up of the Guarantor, whether voluntary or involuntary
and involving insolvency or bankruptcy, or (iii) any assignment for the benefit
of creditors or any other marshaling of assets and liabilities of the Guarantor.

                  "Obligations" means any principal, interest, penalties,
expenses, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Senior Obligations.

                  "Pari Passu Debt" means any indebtedness of the Guarantor
which by its terms is pari passu in right of payment to this Guaranty.

                  "Representative" means the trustee, agent or representative
for any Senior Obligations.

                  "Senior Obligations" shall mean all obligations (whether now
outstanding or hereafter incurred) for the payment of which the

<PAGE>   7

Guarantor is responsible or liable as obligor, guarantor or otherwise, except
those which by their express terms are Pari Passu Debt.

                  This Guaranty shall be governed and construed in accordance
with the laws of the State of Delaware applicable to agreements made and
performed entirely in such State, without regard to conflict of laws principles
thereof.

                                           OAKHURST COMPANY, INC.

                                           By: /s/ Maarten D. Hemsley
                                               Name: Maarten D. Hemsley
                                               Title: President<PAGE>   1

                                                       EXHIBIT 10.3

                                 PROMISSORY NOTE

$20,087                                                         October 18, 1999

          FOR VALUE RECEIVED, Oakhurst Technology, Inc., a corporation organized
under the laws of the State of Delaware (the "Maker"), hereby promises to pay to
the order of Menai Capital LLC (the "Holder"), having an address at 100 First
Stamford Place, Suite 600, Stamford, Connecticut 06902, or its assigns, the
principal sum of Twenty Thousand and Eighty Seven Dollars ($20,087), together
with interest on the unpaid principal balance of this Note payable quarterly at
the rate of 14% per year (computed on the basis of the actual number of days
elapsed in a 360-day year). Quarterly interest payments shall commence on
January 18, 2000 and continue until this Note is paid in full. All principal and
accrued but unpaid interest shall be paid to the Holder on October 18, 2000. All
payments shall be made in immediately available funds.

          All payments by the Maker under this Note shall be made without
set-off, defense or counterclaim and be free and clear and without any deduction
or withholding for any taxes or fees of any nature whatever, unless the
obligation to make such deduction or withholding is imposed by law.

          The Maker agrees that: (i) upon the failure to pay when due the
principal and accrued interest hereunder; (ii) if the Maker (1) commences any
voluntary proceeding under any provision of Title 11 of the United States Code,
as now or hereafter amended, or commences any other proceeding, under any law,
now or hereafter in force, relating to bankruptcy, insolvency, reorganization,
liquidation, or otherwise to the relief of debtors or the readjustment of
indebtedness, (2) makes any assignment for the benefit of creditors or a
composition or similar arrangement with such creditors, or (3) appoints a
receiver, trustee or similar judicial officer or agent to take charge of or
liquidate any of its property or assets; or (iii) upon the commencement against
the Maker of any involuntary proceeding of the kind described in clause (ii)
above (clauses (i), (ii) and (iii) each, an "Event of Default"), all unpaid
principal and accrued but unpaid interest under this Note shall become
immediately due and payable without presentment, demand, protest or notice of
any kind.

          This Note may be prepaid at the option of the Maker, in whole or in
part, upon the refinancing in whole of the multiple advance term loan facility
of Oakhurst Company, Inc. ("OCI") pursuant to the Letter Loan Agreement, dated
December 29, 1998, between OCI and KTI, Inc., at any time after such refinancing
and from time to time thereafter, without penalty or premium. Any voluntary
prepayment of this Note shall be applied first to the payment of interest
accrued and unpaid on this Note and second to the payment of principal.

<PAGE>   2

          None of the terms or provisions of this Note may be excluded, modified
or amended except by a written instrument duly executed by the Holder expressly
referring to this Note and setting forth the provision so excluded, modified or
amended.

          The Maker hereby forever waives presentment, demand, presentment for
payment, protest, notice of protest, notice of dishonor of this Note and all
other demands and notices in connection with the delivery, acceptance,
performance and enforcement of this Note.

          This Note shall be governed and construed in accordance with the laws
of the State of Delaware applicable to agreements made and performed entirely in
such State, without regard to conflict of laws principles thereof, and shall be
binding upon the successors and assigns of the Maker and shall inure to the
benefit of the successors and assigns of the Holder.

                                             OAKHURST TECHNOLOGY, INC.

                                             By: /s/MAARTEN D. HEMSLEY
                                                 ---------------------
                                                 Name:  Maarten D. Hemsley
                                                 Title: President

          FOR VALUE RECEIVED, the sufficiency of which is hereby acknowledged,
Oakhurst Company, Inc. (the "Guarantor") hereby absolutely, unconditionally and
irrevocably guarantees on a subordinated basis (the "Guaranty") the full and
punctual payment when due, whether at stated maturity, by required prepayment,
declaration, acceleration, demand or otherwise, of all amounts due under this
Note of the Maker, whether for principal, interest, fees, expenses or otherwise
(including all such amounts which would become due but for the operation of the
automatic stay under Section 362(a) of the United States Bankruptcy Code, 11
U.S.C. ss. 362(a), and the operation of Sections 502(b) and 506(b) of the United
States Bankruptcy Code, 11 U.S.C. ss. 502(b) and ss. 506(b)); provided, however,
that the Guarantor shall be liable under this Guaranty only for the maximum
amount of such liability that can be hereby incurred without rendering this
Guaranty, as it relates to the Guarantor, voidable under applicable law relating
to fraudulent conveyance or fraudulent transfer, and not for any greater amount.
This Guaranty constitutes a guaranty of payment when due and not of collection,
and the Guarantor specifically agrees that it shall not be necessary or required
that the Holder exercise any right, assert any claim or demand or enforce any
remedy whatsoever against the Maker before or as a condition to the obligations
of the Guarantor hereunder.

     In case the Maker shall fail to punctually pay its obligations under the
Note in full when due, the Guarantor agrees to make such payment punctually when
and as the same shall become due and payable.

     The obligations of the Guarantor hereunder are independent of the
obligations of the Maker, and a separate action or actions may be

<PAGE>   3

brought and prosecuted against the Guarantor, regardless of whether action is
brought against the Maker or whether the Maker is joined in any such action or
actions.

          The Guarantor agrees that its obligations under this Guaranty are
absolute and unconditional, irrespective of the value, genuineness, validity,
regularity or enforceability of this Note, or any substitution, release or
exchange of any other guaranty of or security for the Note, and, to the fullest
extent permitted by applicable law, irrespective of any other circumstance
whatsoever (including, without limitation, personal defenses of the Maker) which
might otherwise constitute a legal or equitable discharge or defense of a
surety, guarantor or co-obligor, it being the intent that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and all
circumstances.

          With respect to its obligations hereunder, the Guarantor hereby
expressly waives diligence, presentment, demand of payment, protest and all
notices whatsoever, and any requirement that the Holder exhaust any right, power
or remedy or proceed against any person under the Note, or against any other
person under any other guaranty of, or security for, or obligation relating to,
the Note.

          The obligations of the Guarantor under this Guaranty shall be
automatically reinstated if and to the extent that for any reason any payment or
performance by or on behalf of any person in respect of the Maker's obligations
under this Note is rescinded or must be otherwise restored by any holder of any
of the Maker's obligations under this Note, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, and the Guarantor
agrees that it will pay to the Holder on demand all reasonable out-of-pocket
costs and expenses (including, without limitation, fees of counsel) incurred by
the Holder in connection with such rescission or restoration, including any such
costs and expenses incurred in defending against any claim alleging that such
payment constituted a preference, fraudulent transfer or similar payment under
any bankruptcy, insolvency or similar law.

          The Maker and the Holder agree that the indebtedness evidenced by this
Note is subordinated in right of payment, to the extent and in the manner
provided herein, to the prior payment in full of all Senior Obligations (whether
outstanding on the date hereof or hereafter created, incurred, assumed or
guaranteed), and that the subordination is for the benefit of the holders of
Senior Obligations.

          Upon any payment or distribution of assets of the Guarantor of any
kind or character, whether in cash, property or securities, to creditors in any
Insolvency or Liquidation Proceeding with respect to the Guarantor, all amounts
due or to become due under or with respect to all Senior Obligations shall first
be paid indefeasibly in full in cash before any payment is made on account of
this Guaranty. Upon any such Insolvency or Liquidation Proceeding, any payment
or distribution of assets of the Guarantor of any kind or character, whether in
cash, property or securities, to which the Holder would be entitled shall be
paid by the Guarantor or by any receiver, trustee

<PAGE>   4

in bankruptcy, liquidating trustee, agent or other person making such payment or
distribution, or by the Holder if received by it, directly to the holders of
Senior Obligations (pro rata to such holders on the basis of the amounts of
Senior Obligations held by such holders) or their Representative, as their
interests may appear, for application to the payment of the Senior Obligations
remaining unpaid until all such Senior Obligations have been paid indefeasibly
in full in cash, after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of Senior Obligations.

          (a) In the event of and during the continuation of any default in the
payment of principal of, interest or premium, if any, on any Senior Obligations,
or in the event that any event of default (other than a payment default) with
respect to any Senior Obligations shall have occurred and be continuing and
shall have resulted in such Senior Obligation becoming or being declared due and
payable prior to the date on which it would otherwise have become due and
payable, or (b) if any event of default other than as described in clause (a)
above with respect to any Senior Obligations shall have occurred and be
continuing permitting the holders of such Senior Obligations (or their
Representative or Representatives) to declare such Senior Obligations due and
payable prior to the date on which it would otherwise have become due and
payable, then no payment shall be made by or on behalf of the Guarantor on
account of this Guaranty, unless and until such default shall have been cured or
waived in writing in accordance with the instruments governing such Senior
Obligations or such acceleration shall have been rescinded or annulled.

          In the event that the Holder receives any payment with respect to this
Guaranty at a time when such payment is prohibited by the provisions hereof,
such payment shall be held by the Holder, in trust for the benefit of, and shall
be paid forthwith over and delivered, upon written request, to, the holders of
Senior Obligations as their interests may appear or their Representative under
the agreements (if any) pursuant to which Senior Obligations may have been
issued, as their respective interests may appear, for application to the payment
of all Obligations with respect to Senior Obligations remaining unpaid to the
extent necessary to pay such Obligations in full in accordance with their terms,
after giving effect to any concurrent payment or distribution to or for the
holders of Senior Obligations.

          After all Senior Obligations are paid in full and until this Guaranty
is paid in full, the Holder shall be subrogated (equally and ratably with all
other Pari Passu Debt) to the rights of holders of Senior Obligations to receive
distributions applicable to Senior Obligations to the extent that distributions
otherwise payable to the Holder have been applied to the payment of Senior
Obligations. A distribution made under this Guaranty to holders of Senior
Obligations that otherwise would have been made to the Holder is not, as between
the Guarantor and the Holder, a payment by the Guarantor on this Guaranty.

          The "Subordination" section of this Guaranty defines the relative
rights of the Holder and holders of Senior Obligations. Nothing in this Guaranty
shall impair, as between the Guarantor and

<PAGE>   5

the Holder, the obligations of the Guarantor, which are absolute and
unconditional, to pay principal of and interest on this Guaranty in accordance
with its terms or affect the relative rights of the Holder and creditors of the
Guarantor other than their rights in relation to holders of Senior Obligations.

          No right of any holder of Senior Obligations to enforce the
subordination of the indebtedness evidenced by this Guaranty shall be impaired
by any act or failure to act by the Guarantor or the Holder or by the failure of
the Guarantor or the Holder to comply with this Guaranty.

          Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Obligations, or any of them, may, at any time and from
time to time, without the consent of or notice to the Holder, without incurring
any liabilities to the Holder and without impairing or releasing the
subordination and other benefits provided in this Guaranty or the obligations of
the Holder to the holders of the Senior Obligations, even if any right of
reimbursement or subrogation or other right or remedy of the Holder is affected,
impaired or extinguished thereby, take any action with respect to the Senior
Obligations, including, without limitation, any one or more of the following:

          (1) change the manner, place or terms of payment or change or extend
     the time of payment of, or renew, exchange, amend, increase or alter, the
     terms of any Senior Obligations, any security therefor or guaranty thereof
     or any liability of any obligor thereon (including any guarantor) to such
     holder, or any liability incurred directly or indirectly in respect thereof
     or otherwise amend, renew, exchange, extend, modify, increase or supplement
     in any manner any Senior Obligations or any instrument evidencing or
     guaranteeing or securing the same or any agreement under which Senior
     Obligations are outstanding;

          (2) sell, exchange, release, surrender, realize upon, enforce or
     otherwise deal with in any manner and in any order any property pledged,
     mortgaged or otherwise securing Senior Obligations or any liability of any
     obligor thereon, to such holder, or any liability incurred directly or
     indirectly in respect thereof;

          (3) settle or compromise any Senior Obligations or any other liability
     of any obligor of the Senior Obligations to such holder or any security
     therefor or any liability incurred directly or indirectly in respect
     thereof and apply any sums by whomsoever paid and however realized to any
     liability (including, without limitation, Senior Obligations) in any manner
     or order; and

          (4) fail to take or to record or to otherwise perfect, for any reason
     or for no reason, any lien or security interest securing Senior Obligations
     by whomsoever granted, exercise or delay in or refrain from exercising any
     right or remedy against any obligor or any guarantor or any other person,
     elect any remedy and otherwise deal freely with any obligor and any
     security for the Senior Obligations or any liability of any obligor to such

<PAGE>   6

     holder or any liability incurred directly or indirectly in respect thereof.

          Whenever a distribution is to be made or a notice given to holders of
Senior Obligations, the distribution may be made and the notice given to their
Representative. Upon any payment or distribution of assets of the Guarantor
referred to in the "Subordination" section of this Guaranty, the Holder shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction or upon any certificate of such Representative or of the
liquidating trustee or agent or other person making any distribution to the
Holder for the purpose of ascertaining the persons entitled to participate in
such distribution, the holders of the Senior Obligations and other indebtedness
of the Guarantor, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent thereto or to the
"Subordination" section of this Guaranty.

          "Insolvency or Liquidation Proceedings" means (i) any voluntary or
involuntary insolvency or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding, relative to the
Guarantor or to the creditors of the Guarantor, as such, or to the assets of the
Guarantor, or (ii) any liquidation, dissolution, reorganization or winding up of
the Guarantor, whether voluntary or involuntary and involving insolvency or
bankruptcy, or (iii) any assignment for the benefit of creditors or any other
marshaling of assets and liabilities of the Guarantor.

          "Obligations" means any principal, interest, penalties, expenses,
fees, indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Senior Obligations.

          "Pari Passu Debt" means any indebtedness of the Guarantor which by its
terms is pari passu in right of payment to this Guaranty.

          "Representative" means the trustee, agent or representative for any
Senior Obligations.

          "Senior Obligations" shall mean all obligations (whether now
outstanding or hereafter incurred) for the payment of which the Guarantor is
responsible or liable as obligor, guarantor or otherwise, except those which by
their express terms are Pari Passu Debt.

<PAGE>   7

          This Guaranty shall be governed and construed in accordance with the
laws of the State of Delaware applicable to agreements made and performed
entirely in such State, without regard to conflict of laws principles thereof.

                                   OAKHURST COMPANY, INC.

                                   By: /s/MAARTEN D. HEMSLEY
                                       ---------------------
                                   Name:  Maarten D. Hemsley
                                   Title: President

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