Exhibit 4.8
SUBSIDIARY GUARANTY
New York, New York April 26, 2004
FOR VALUE RECEIVED, and in consideration of note purchases from, loans
made or to be made or credit otherwise extended or to be extended by Laurus
Master Fund, Ltd. ("Laurus") to or for the account of Conolog Corporation
("Debtor") from time to time and at any time and for other good and valuable
consideration and to induce ▇▇▇▇▇▇, in its discretion, to purchase such notes,
make such loans or extensions of credit and to make or grant such renewals,
extensions, releases of collateral or relinquishments of legal rights as Laurus
may deem advisable, each of the undersigned (and each of them if more than one,
the liability under this Guaranty being joint and several) (jointly and
severally referred to as "Guarantors " or "the undersigned") unconditionally
guaranties to Laurus, its successors, endorsees and assigns the prompt payment
when due (whether by acceleration or otherwise) of all present and future
obligations and liabilities of any and all kinds of Debtor to Laurus and of all
instruments of any nature evidencing or relating to any such obligations and
liabilities upon which Debtor or one or more parties and Debtor is or may become
liable to Laurus, whether incurred by Debtor as maker, endorser, drawer,
acceptor, guarantors , accommodation party or otherwise, and whether due or to
become due, secured or unsecured, absolute or contingent, joint or several, and
however or whenever acquired by ▇▇▇▇▇▇, whether arising under, out of, or in
connection with that certain Securities Purchase Agreement dated as of the date
hereof by and between Debtor and Laurus (the "Securities Purchase Agreement");
that certain Secured Convertible Note dated as of the date hereof made by Debtor
in favor of ▇▇▇▇▇▇ (the "Note") the Warrant dated as of the date hereof made by
Debtor in favor of ▇▇▇▇▇▇ (the "Warrant")or that certain Registration Rights
Agreement dated as of the date hereof by and between Debtor and Laurus (the
"Registration Rights Agreement") (the Securities Purchase Agreement, the Note,
the Warrant and the Registration Rights Agreement, as each may be amended,
modified, restated or supplemented from time to time, are collectively referred
to herein as the "Documents"), or any documents, instruments or agreements
relating to or executed in connection with the Documents or any documents,
instruments or agreements referred to therein or otherwise (all of which are
herein collectively referred to as the "Obligations"), and irrespective of the
genuineness, validity, regularity or enforceability of such Obligations, or of
any instrument evidencing any of the Obligations or of any collateral therefor
or of the existence or extent of such collateral, and irrespective of the
allowability, allowance or disallowance of any or all of the Obligations in any
case commenced by or against Debtor under Title 11, United States Code,
including, without limitation, obligations or indebtedness of Debtor for
post-petition interest, fees, costs and charges that would have accrued or been
added to the Obligations but for the commencement of such case. In furtherance
of the foregoing, the undersigned ▇▇▇▇▇▇ agrees as follows:
1. No Impairment. Laurus may at any time and from time to time, either
before or after the maturity thereof, without notice to or further consent of
the undersigned, extend the time of payment of, exchange or surrender any
collateral for, renew or extend any of the Obligations or increase or decrease
the interest rate thereon, and may also make any agreement with Debtor or with
any other party to or person liable on any of the Obligations, or interested
therein, for the extension, renewal, payment, compromise, discharge or release
thereof, in whole or in part, or for any modification of the terms thereof or of
any agreement between Laurus and Debtor or any such other party or person, or
make any election of rights Laurus may deem desirable under the United States
Bankruptcy Code, as amended, or any other federal or state bankruptcy,
reorganization, moratorium or insolvency law relating to or affecting the
enforcement of creditors' rights generally (any of the foregoing, an "Insolvency
Law") without in any way impairing or affecting this Guaranty. This instrument
shall be effective regardless of the subsequent incorporation, merger or
consolidation of Debtor, or any change in the composition, nature, personnel or
location of Debtor and shall extend to any successor entity to Debtor, including
a debtor in possession or the like under any Insolvency Law.
2. Guaranty Absolute. Each of the undersigned jointly and severally
guarantees that the Obligations will be paid strictly in accordance with the
terms of the Documents and/or any other document, instrument or agreement
creating or evidencing the Obligations, regardless of any law, regulation or
order now or hereafter in effect in any jurisdiction affecting any of such terms
or the rights of Debtor with respect thereto. Guarantors hereby knowingly accept
the full range of risk encompassed within a contract of "continuing guaranty"
which risk includes the possibility that Debtor will contract additional
indebtedness for which Guarantors may be liable hereunder after ▇▇▇▇▇▇'s
financial condition or ability to pay its lawful debts when they fall due has
deteriorated, whether or not Debtor has properly authorized incurring such
additional indebtedness. The undersigned acknowledge that (i) no oral
representations, including any representations to extend credit or provide other
financial accommodations to Debtor, have been made by ▇▇▇▇▇▇ to induce the
undersigned to enter into this Guaranty and (ii) any extension of credit to the
Debtor shall be governed solely by the provisions of the Documents. The
liability of each of the undersigned under this Guaranty shall be absolute and
unconditional, in accordance with its terms, and shall remain in full force and
effect without regard to, and shall not be released, suspended, discharged,
terminated or otherwise affected by, any circumstance or occurrence whatsoever,
including, without limitation: (a) any waiver, indulgence, renewal, extension,
amendment or modification of or addition, consent or supplement to or deletion
from or any other action or inaction under or in respect of the Documents or any
other instruments or agreements relating to the Obligations or any assignment or
transfer of any thereof, (b) any lack of validity or enforceability of any Loan
Document or other documents, instruments or agreements relating to the
Obligations or any assignment or transfer of any thereof, (c) any furnishing of
any additional security to Laurus or its assignees or any acceptance thereof or
any release of any security by Laurus or its assignees, (d) any limitation on
any party's liability or obligation under the Documents or any other documents,
instruments or agreements relating to the Obligations or any assignment or
transfer of any thereof or any invalidity or unenforceability, in whole or in
part, of any such document, instrument or agreement or any term thereof, (e) any
bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,
liquidation or other like proceeding relating to Debtor, or any action taken
with respect to this Guaranty by any trustee or receiver, or by any court, in
any such proceeding, whether or not the undersigned shall have notice or
knowledge of any of the foregoing, (f) any exchange, release or nonperfection of
any collateral, or any release, or amendment or waiver of or consent to
departure from any guaranty or security, for all or any of the Obligations or
(g) any other circumstance which might otherwise constitute a defense available
to, or a discharge of, the undersigned. Any amounts due from the undersigned to
Laurus shall bear interest until such amounts are paid in full at the highest
rate then applicable to the Obligations. Obligations include post-petition
interest whether or not allowed or allowable.
3. Waivers.
(a) This Guaranty is a guaranty of payment and not of collection.
Laurus shall be under no obligation to institute suit, exercise rights or
remedies or take any other action against Debtor or any other person
liable with respect to any of the Obligations or
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resort to any collateral security held by it to secure any of the
Obligations as a condition precedent to the undersigned being obligated to
perform as agreed herein and each of the Guarantors hereby waives any and
all rights which it may have by statute or otherwise which would require
Laurus to do any of the foregoing. Each of the Guarantors further consents
and agrees that ▇▇▇▇▇▇ shall be under no obligation to marshal any assets
in favor of Guarantors, or against or in payment of any or all of the
Obligations. The undersigned hereby waives all suretyship defenses and any
rights to interpose any defense, counterclaim or offset of any nature and
description which the undersigned may have or which may exist between and
among Laurus, Debtor and/or the undersigned with respect to the
undersigned's obligations under this Guaranty, or which Debtor may assert
on the underlying debt, including but not limited to failure of
consideration, breach of warranty, fraud, payment (other than cash payment
in full of the Obligations), statute of frauds, bankruptcy, infancy,
statute of limitations, accord and satisfaction, and usury.
(b) Each of the undersigned further waives (i) notice of the
acceptance of this Guaranty, of the making of any such loans or extensions
of credit, and of all notices and demands of any kind to which the
undersigned may be entitled, including, without limitation, notice of
adverse change in Debtor's financial condition or of any other fact which
might materially increase the risk of the undersigned and (ii) presentment
to or demand of payment from anyone whomsoever liable upon any of the
Obligations, protest, notices of presentment, non-payment or protest and
notice of any sale of collateral security or any default of any sort.
(c) Notwithstanding any payment or payments made by the undersigned
hereunder, or any setoff or application of funds of the undersigned by
▇▇▇▇▇▇, the undersigned shall not be entitled to be subrogated to any of
the rights of ▇▇▇▇▇▇ against Debtor or against any collateral or guarantee
or right of offset held by ▇▇▇▇▇▇ for the payment of the Obligations, nor
shall the undersigned seek or be entitled to seek any contribution or
reimbursement from Debtor in respect of payments made by the undersigned
hereunder, until all amounts owing to Laurus by ▇▇▇▇▇▇ on account of the
Obligations are paid in full and the Documents have been terminated. If,
notwithstanding the foregoing, any amount shall be paid to the undersigned
on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full and the Documents shall not
have been terminated, such amount shall be held by the undersigned in
trust for ▇▇▇▇▇▇, segregated from other funds of the undersigned, and
shall forthwith upon, and in any event within two (2) business days of,
receipt by the undersigned, be turned over to Laurus in the exact form
received by the undersigned (duly endorsed by the undersigned to Laurus,
if required), to be applied against the Obligations, whether matured or
unmatured, in such order as Laurus may determine, subject to the
provisions of the Documents. Any and all present and future debts and
obligations of Debtor to any of the undersigned are hereby waived and
postponed in favor of, and subordinated to the full payment and
performance of, all present and future debts and obligations of Debtor to
▇▇▇▇▇▇.
4. Security. All sums at any time to the credit of the undersigned and any
property of the undersigned in Laurus' possession or in the possession of any
bank, financial institution or other entity that directly or indirectly, through
one or more intermediaries, controls or is controlled by, or is under common
control with, Laurus (each such entity, an "Affiliate") shall be deemed held by
Laurus or such Affiliate, as the case may be, as security for any and all of the
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undersigned's obligations to ▇▇▇▇▇▇ and to any Affiliate of Laurus, no matter
how or when arising and whether under this or any other instrument, agreement or
otherwise. Notwithstanding anything to the contrary contained herein, the
security interest granted to Laurus shall be limited to goods (including but not
limited to equipment and expressly excluding inventory) of the undersigned.
5. Representations and Warranties. Each of the undersigned respectively,
hereby jointly and severally represents and warrants (all of which
representations and warranties shall survive until all Obligations are
indefeasibly satisfied in full and the Documents have been irrevocably
terminated), that:
(a) Corporate Status. The undersigned is a corporation duly
organized, validly existing and in good standing under the laws of the
state of incorporation indicated on the signature page hereof and has full
power, authority and legal right to own its property and assets and to
transact the business in which it is engaged.
(b) Authority and Execution. The undersigned has full power,
authority and legal right to execute and deliver, and to perform its
obligations under, this Guaranty and has taken all necessary corporate and
legal action to authorize the execution, delivery and performance of this
Guaranty.
(c) Legal, ▇▇▇▇▇ and Binding Character. This Guaranty constitutes
the legal, valid and binding obligation of the undersigned enforceable in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other
laws of general application affecting the enforcement of creditor's rights
and general principles of equity that restrict the availability of
equitable or legal remedies.
(d) Violations. The execution, delivery and performance of this
Guaranty will not violate any requirement of law applicable to the
undersigned or any material contract, agreement or instrument to which the
undersigned is a party or by which the undersigned or any property of the
undersigned is bound or result in the creation or imposition of any
mortgage, lien or other encumbrance other than to Laurus on any of the
property or assets of the undersigned pursuant to the provisions of any of
the foregoing.
(e) Consents or Approvals. No consent of any other person or entity
(including, without limitation, any creditor of the undersigned) and no
consent, license, permit, approval or authorization of, exemption by,
notice or report to, or registration, filing or declaration with, any
governmental authority is required in connection with the execution,
delivery, performance, validity or enforceability of this Guaranty.
(f) Litigation. No litigation, arbitration, investigation or
administrative proceeding of or before any court, arbitrator or
governmental authority, bureau or agency is currently pending or, to the
best knowledge of the undersigned, threatened (i) with respect to this
Guaranty or any of the transactions contemplated by this Guaranty or (ii)
against or affecting the undersigned, or any of property or assets of the
undersigned, which, if adversely determined, would have a material adverse
effect on the business, operations, assets or condition, financial or
otherwise, of the undersigned.
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(g) Financial Benefit. Each of the undersigned has derived or
expects to derive a financial or other advantage from each and every loan,
advance or extension of credit made under the Documents or other
Obligation incurred by Debtor to Laurus.
6. Acceleration.
(a) If any breach of any covenant or condition or other event of
default shall occur and be continuing under any agreement made by Debtor
or any of the undersigned to Laurus, or either Debtor or any of the
undersigned should at any time become insolvent, or make a general
assignment, or if a proceeding in or under any Insolvency Law shall be
filed or commenced by, or in respect of, any of the undersigned, or if a
notice of any lien, levy, or assessment is filed of record with respect to
any assets of any of the undersigned by the United States of America or
any department, agency, or instrumentality thereof, or if any taxes or
debts owing at any time or times hereafter to any one of them becomes a
lien or encumbrance upon any assets of the undersigned in Laurus'
possession, or otherwise, any and all Obligations shall for purposes
hereof, at Laurus' option, be deemed due and payable without notice
notwithstanding that any such Obligation is not then due and payable by
Debtor.
(b) Each of the undersigned will promptly notify Laurus of any
default by such undersigned in its respective performance or observance of
any term or condition of any agreement to which the undersigned is a party
if the effect of such default is to cause, or permit the holder of any
obligation under such agreement to cause, such obligation to become due
prior to its stated maturity and, if such an event occurs, ▇▇▇▇▇▇ shall
have the right to accelerate such undersigned's obligations hereunder.
7. Payments from Guarantors. Laurus, in its sole and absolute discretion,
with or without notice to the undersigned, may apply on account of the
Obligations any payment from the undersigned or any other guarantors, or amounts
realized from any security for the Obligations, or may deposit any and all such
amounts realized in a non-interest bearing cash collateral deposit account to be
maintained as security for the Obligations.
8. Costs. The undersigned shall pay on demand, all costs, fees and
expenses (including expenses for legal services of every kind) relating or
incidental to the enforcement or protection of the rights of Laurus hereunder or
under any of the Obligations.
9. No Termination. This is a continuing irrevocable guaranty and shall
remain in full force and effect and be binding upon the undersigned, and each of
the undersigned's successors and assigns, until all of the Obligations have been
paid in full and the Documents have been irrevocably terminated. If any of the
present or future Obligations are guarantied by persons, partnerships or
corporations in addition to the undersigned, the death, release or discharge in
whole or in part or the bankruptcy, merger, consolidation, incorporation,
liquidation or dissolution of one or more of them shall not discharge or affect
the liabilities of any undersigned under this Guaranty.
10. Recapture. Anything in this Guaranty to the contrary notwithstanding,
if ▇▇▇▇▇▇ receives any payment or payments on account of the liabilities
guaranteed hereby, which payment or payments or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver, or any other party under
any Insolvency Law, common law or equitable doctrine, then to the extent of any
sum not
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finally retained by ▇▇▇▇▇▇, the undersigned's obligations to ▇▇▇▇▇▇ shall be
reinstated and this Guaranty shall remain in full force and effect (or be
reinstated) until payment shall have been made to Laurus, which payment shall be
due on demand.
11. Books and Records. The books and records of ▇▇▇▇▇▇ showing the account
between ▇▇▇▇▇▇ and Debtor shall be admissible in evidence in any action or
proceeding, shall be binding upon the undersigned for the purpose of
establishing the items therein set forth and shall constitute prima facie proof
thereof.
12. No Waiver. No failure on the part of Laurus to exercise, and no delay
in exercising, any right, remedy or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise by ▇▇▇▇▇▇ of any right, remedy
or power hereunder preclude any other or future exercise of any other legal
right, remedy or power. Each and every right, remedy and power hereby granted to
Laurus or allowed it by law or other agreement shall be cumulative and not
exclusive of any other, and may be exercised by ▇▇▇▇▇▇ at any time and from time
to time.
13. Waiver of Jury Trial. EACH OF THE UNDERSIGNED DOES HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BASED ON OR WITH RESPECT TO THIS GUARANTY OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR RELATING OR INCIDENTAL HERETO. THE UNDERSIGNED DOES
HEREBY CERTIFY THAT NO REPRESENTATIVE OR AGENT OF ▇▇▇▇▇▇ HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT LAURUS WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION.
14. Governing Law; Jurisdiction; Amendments. THIS INSTRUMENT CANNOT BE
CHANGED OR TERMINATED ORALLY, AND SHALL BE GOVERNED, CONSTRUED AND INTERPRETED
AS TO VALIDITY, ENFORCEMENT AND IN ALL OTHER RESPECTS IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK. EACH OF THE UNDERSIGNED EXPRESSLY CONSENTS TO THE
JURISDICTION AND VENUE OF THE SUPREME COURT OF THE STATE OF NEW YORK, COUNTY OF
NEW YORK, AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK FOR ALL PURPOSES IN CONNECTION HEREWITH. ANY JUDICIAL PROCEEDING BY THE
UNDERSIGNED AGAINST LAURUS INVOLVING, DIRECTLY OR INDIRECTLY ANY MATTER OR CLAIM
IN ANY WAY ARISING OUT OF, RELATED TO OR CONNECTED HEREWITH SHALL BE BROUGHT
ONLY IN THE SUPREME COURT OF THE STATE OF NEW YORK, COUNTY OF NEW YORK OR THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. THE
UNDERSIGNED FURTHER CONSENTS THAT ANY SUMMONS, SUBPOENA OR OTHER PROCESS OR
PAPERS (INCLUDING, WITHOUT LIMITATION, ANY NOTICE OR MOTION OR OTHER APPLICATION
TO EITHER OF THE AFOREMENTIONED COURTS OR A JUDGE THEREOF) OR ANY NOTICE IN
CONNECTION WITH ANY PROCEEDINGS HEREUNDER, MAY BE SERVED INSIDE OR OUTSIDE OF
THE STATE OF NEW YORK OR THE SOUTHERN DISTRICT OF NEW YORK BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR BY PERSONAL SERVICE PROVIDED A
REASONABLE TIME FOR APPEARANCE IS PERMITTED, OR IN SUCH OTHER MANNER AS MAY BE
PERMISSIBLE UNDER THE RULES OF SAID COURTS. EACH OF THE UNDERSIGNED WAIVES ANY
OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED HEREON AND SHALL
NOT ASSERT ANY
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DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR BASED UPON FORUM NON
CONVENIENS.
15. Severability. To the extent permitted by applicable law, any provision
of this Guaranty which 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 provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
16. Amendments, Waivers. No amendment or waiver of any provision of this
Guaranty nor consent to any departure by the undersigned therefrom shall in any
event be effective unless the same shall be in writing executed by each of the
undersigned and ▇▇▇▇▇▇.
17. Notice. All notices, requests and demands to or upon the undersigned,
shall be in writing and shall be deemed to have been duly given or made (a) when
delivered, if by hand, (b) three (3) days after being sent, postage prepaid, if
by registered or certified mail, (c) when confirmed electronically, if by
facsimile, or (d) when delivered, if by a recognized overnight delivery service
in each event, to the numbers and/or address set forth beneath the signature of
the undersigned.
18. Successors. Laurus may, from time to time, without notice to the
undersigned, sell, assign, transfer or otherwise dispose of all or any part of
the Obligations and/or rights under this Guaranty. Without limiting the
generality of the foregoing, Laurus may assign, or grant participations to, one
or more banks, financial institutions or other entities all or any part of any
of the Obligations. In each such event, Laurus, its Affiliates and each and
every immediate and successive purchaser, assignee, transferee or holder of all
or any part of the Obligations shall have the right to enforce this Guaranty, by
legal action or otherwise, for its own benefit as fully as if such purchaser,
assignee, transferee or holder were herein by name specifically given such
right. Laurus shall have an unimpaired right to enforce this Guaranty for its
benefit with respect to that portion of the Obligations which ▇▇▇▇▇▇ has not
disposed of, sold, assigned, or otherwise transferred.
19. Release. Nothing except cash payment in full of the Obligations shall
release any of the undersigned from liability under this Guaranty.
[Remainder of this page is blank.
Signature page immediately follows]
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IN WITNESS WHEREOF, this Guaranty has been executed by the undersigned
this __ day of April 26, 2003.
NOLOGOC CORP.
By: _________________________________
Name: _________________________________
Title: _________________________________
Address:
Telephone:
Facsimile:
State of Incorporation: New Jersey
_________________________________
_________________________________
_________________________________
___________________________
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___________________________
___________________________
_________________________________
_________________________________
_________________________________
___________________________
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STATE OF _____________ )
) SS
COUNTY OF ____________ )
On the ____ day of February , 2004, before me personally came
___________________________________________ to me known, who being by me duly
sworn, did depose and say s/he is the ______________ of ___________________ the
corporation described in and which executed the foregoing instrument; and that
s/he signed her/his name thereto by order of the board of directors of said
corporation.
____________________________________________
____________________________________________
Notary Public
My Commission Expires:
______________________
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