GUARANTY
Exhibit
10.3
THIS GUARANTY is made on the 27th day of July, 2006, by Rainier Home Health Care
Pharmacy, Inc., a Washington corporation (“Rainier”), Precision Healthcare, Inc., a
Tennessee corporation (“Precision”), Long Term Rx, Inc., an Indiana corporation (“Long
Term Rx”), Home Med Channel, Inc., an Indiana corporation (“Home Med”), Holland Compounding
Pharmacy, Inc., a Washington corporation (“Xxxxxxx XX”), and Holland Drug Store, Inc. a
Washington corporation (“Holland”, and collectively with Rainier, Precision, Long Term Rx, Home
Med, and Xxxxxxx XX, “Guarantors”), in favor of Xxxxxxx X. Xxxxxxxx (“Lender”).
RECITALS
A. Guarantors are indirect subsidiaries of Standard Management Corporation, an Indiana
corporation (“Borrower”).
B. Borrower intends to obtain from Lender a bridge loan to be evidenced by a Secured
Promissory Note of even date herewith, in the original principal amount of $2,837,087.67 (such
promissory note, as amended, modified, renewed, or extended from time to time, the “Note”).
C. Lender has advised Borrower and Guarantors that Lender will not extend the bridge loan
unless all of Borrower’s obligations under the Note and the Fee Letter are guaranteed by
Guarantors.
D. Guarantors are willing and have agreed to guarantee all such obligations of Borrower, as
hereinafter provided.
AGREEMENT
NOW, THEREFORE, in consideration of and as an inducement to Lender to extend credit to
Borrower upon the terms and conditions set forth in the Note, and in consideration of the premises
and for other good and valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, Guarantors agree as follows:
1. The Guaranty. Guarantors, jointly and severally, unconditionally and irrevocably
guarantee: (a) the due and punctual payment in full by Borrower when due of the indebtedness of
Borrower to Lender evidenced by or arising under the Note and under the Fee Letter dated July 26,
2006, by Borrower to Lender (the “Fee Letter”), and all extensions, renewals, and
modifications thereof, and (b) the due and punctual performance and observance by Borrower of all
of the other terms, covenants, representations, warranties, and conditions agreed to by Borrower in
the Note and the Fee Letter.
2. Certain Lender Discretions. Guarantors expressly agree that Lender may, in
Lender’s sole and absolute discretion, without notice to or further assent of Guarantors, and
without in any way releasing, affecting or impairing the obligations and liabilities of any
Guarantor hereunder: (a) waive compliance with, or default under, or grant any other indulgences
with respect to, the Note or the Loan Documents (as defined in the Note), (b) agree to modify,
amend, or change any provisions of the Note or the Loan Documents, (c) grant extensions or renewals
of or with respect to the obligations and covenants of Borrower and Guarantors under the Note or
the Loan Documents (and/or effect any release, compromise or settlement in connection therewith),
and (d) deal in all respects with Borrower, each Guarantor, and all collateral for the obligations
of Borrower and each Guarantor, as if this Guaranty were not in effect.
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3. Nature of Guaranty. The liability of Guarantors under this Guaranty shall be
primary, direct and immediate and not conditional or contingent upon pursuit by Lender of any
remedies it may have against Borrower or any Guarantor with respect to the Note or any of the Loan
Documents. No exercise or non-exercise by Lender of any right given to it hereunder or under the
Note or any Loan Document shall affect any of Guarantors’ obligations hereunder or give Guarantors
any recourse against Lender. Without limiting the generality of the foregoing, Lender shall not be
required to make any demand on Borrower, or otherwise pursue or exhaust its remedies against
Borrower or any collateral security for the obligations of Borrower or any Guarantor before,
simultaneously with or after, enforcing its rights and remedies hereunder against Guarantors. Any
one or more successive and/or concurrent actions may be brought hereon against Guarantors either in
the same action, if any, brought against Borrower, or in separate actions, as often as Lender, in
his sole discretion, may deem advisable. The obligations of Guarantors under this Guaranty shall be
unconditional irrespective of failure of genuineness, validity, regularity or enforceability of the
Note resulting from action or inaction on the part of Borrower or any other circumstances which
might otherwise constitute a legal or equitable discharge of a surety or a guarantor. Guarantors
hereby expressly waive acceptance hereof, and any notice or demand to which they would otherwise be
entitled hereunder solely by reason of the fact that its position is one of suretyship, including
without limitation notice of non-performance of Borrower under the Note or of any Guarantor under
any Loan Documents and presentment for payment, protest, or notice of protest for any obligation
created under the Note.
4. Certain Rights of Lender. All rights and remedies afforded to Lender by reason of
this Guaranty, or by law, are separate and cumulative and the exercise of one shall not in any way
limit or prejudice the exercise of any other such rights or remedies. No delay or omission by
Lender in exercising any such right or remedy shall operate as a waiver thereof. No waiver of any
rights and remedies hereunder shall be deemed made by Lender unless in writing and duly executed.
No modification or amendment hereof shall be deemed made except in writing duly executed by Lender
and Guarantors. Any such written waiver shall apply only to the particular instance specified
therein and shall not impair the further exercise of such right or remedy or of any other right or
remedy of Lender, and no single or partial exercise of any right or remedy hereunder shall preclude
further exercise of any other right or remedy.
5. No Impairment. The obligation of Guarantors to make payment for or perform the
obligations of Borrower in accordance with the terms of this Guaranty shall not be impaired,
modified, changed, released or limited in any manner whatsoever by any impairment, modification,
change, release or limitation of the liability of Borrower or its estate in bankruptcy or
reorganization resulting from the operation of any present or future provision of the United States
Bankruptcy Code or other similar laws or statutes affecting the enforcement of creditors’ rights.
6. General Provisions. This Guaranty shall be governed by and construed in
accordance with the laws of the State of Indiana, without regard to such jurisdiction’s conflict of
laws principles. In case any one or more of the provisions contained herein shall, for any reason,
be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Guaranty, but this Guaranty shall be
construed as if such invalid, illegal or unenforceable provision or provisions had never been
contained herein. Titles and headings to articles and sections herein are inserted for convenience
of reference only and are not intended to be a part of or to affect the meaning or interpretation
of this Guaranty. Lender shall be entitled, in addition to such other relief as it may be entitled,
to collect from Guarantors, or any of them, all of Lender’s reasonable costs and expenses
(including, without limitation, reasonable attorneys’ fees and costs) incurred in enforcing the
terms of this Guaranty.
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7. Covenant of Guarantors. Each Guarantor agrees that it will not declare or pay any
dividend or distribution on its capital stock, or redeem, repurchase, or otherwise acquire or
retire any of its capital stock without the prior written consent of Lender.
[Signature Page Follows]
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IN WITNESS WHEREOF, Guarantors have caused this Guaranty to be executed as of the day and year
first above written.
| Rainier Home Health Care Pharmacy, Inc. |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Printed: Xxxxxxx X. Xxxxx | ||||
| Title: Treasurer | ||||
| Precision Healthcare, Inc. |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Printed: Xxxxxxx X. Xxxxx | ||||
| Title: Treasurer | ||||
Long Term Rx, Inc. |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Printed: Xxxxxxx X. Xxxxx | ||||
| Title: Treasurer | ||||
| Home Med Channel, Inc. |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Printed: Xxxxxxx X. Xxxxx | ||||
| Title: Treasurer | ||||
| Holland Compounding Pharmacy, Inc. |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Printed: Xxxxxxx X. Xxxxx | ||||
| Title: Treasurer | ||||
| Holland Drug Store, Inc. |
||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||
| Printed: Xxxxxxx X. Xxxxx | ||||
| Title: Treasurer | ||||
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