GUARANTY

 

This Guaranty (the “Guaranty”) is made this 21st day of December, 2012, by such
guarantors listed on the signature pages hereof (collectively, jointly and
severally, “Guarantors,” and each, individually, a “Guarantor”), in favor of the
secured parties listed on the signature pages hereof (together with its
successors, assigns, endorsees and transferees).

 

RECITALS

 

WHEREAS, pursuant to that certain Securities Purchase Agreement, dated as of
December 21, 2012 (as amended, restated, supplemented, or otherwise modified
from time to time, including all schedules thereto, the “Securities Purchase
Agreement”), by and among BOLDFACE Group, Inc., a Nevada corporation (“Parent”),
and each of the investors listed on the Schedule of Purchasers attached thereto
(collectively, with their successors, assigns, endorsees and transferees, the
“Purchasers” and each, individually, a “Purchaser”), Parent has agreed to sell,
and Purchasers have each agreed to purchase, severally and not jointly, certain
Notes and Warrants;

 

WHEREAS, each Guarantor is a direct or indirect wholly-owned Subsidiary of
Parent and will receive direct and substantial benefits from the purchase by
Purchasers of the Notes and Warrants;

 

WHEREAS, in order to induce Purchasers to purchase, severally and not jointly,
the Notes and Warrants as provided for in the Securities Purchase Agreement,
Guarantors have agreed to jointly and severally guaranty all of Parent’s
obligations under and with respect to the Notes and the Securities Purchase
Agreement; and

 

WHEREAS, in connection herewith, Guarantors, Parent and Purchasers have entered
into that certain Security Agreement dated of even date herewith (as amended,
restated, supplemented, or otherwise modified from time to time, including all
schedules thereto, the “Security Agreement”), pursuant to which Guarantors and
Parent (Guarantors and Parent, collectively, “Obligors” and each, individually,
an “Obligor”) have granted each of the Purchasers continuing security interests
in all assets of each Obligor, as more fully set forth in the Security
Agreement.

 

AGREEMENTS

 

NOW, THEREFORE, for and in consideration of the recitals made above and other
good and valuable consideration, the receipt, sufficiency and adequacy of which
are hereby acknowledged, each Guarantor hereby agrees as follows:

 

1.          Definitions. All capitalized terms used herein that are not
otherwise defined herein shall have the meanings given them in the Securities
Purchase Agreement or the Security Agreement, as the case may be.

 

 

 

 

2.          Guaranteed Obligations. Guarantors jointly and severally hereby
irrevocably and unconditionally guaranty to Purchaser the due and punctual
Satisfaction in Full of the Guaranteed Obligations (as defined below).
“Guaranteed Obligations” means, collectively, all of the present and future
payment and performance obligations of each Obligor arising under the Securities
Purchase Agreement, any and all Notes payable to Purchaser, the Security
Agreement and the other Transaction Documents, including, without limitation,
attorneys’ fees and expenses and any interest, fees, or expenses that accrue
after the filing of an Insolvency Proceeding, regardless of whether allowed or
allowable in whole or in part as a claim in any Insolvency Proceeding.

 

3.          Guarantors’ Representations and Warranties. Each Guarantor
represents and warrants to Purchaser that such Guarantor expects to derive
substantial benefits from the purchase by Purchasers of the Notes and Warrants
and the other transactions contemplated hereby and by the other Transaction
Documents. Purchaser may rely conclusively on a continuing warranty, hereby
made, that such Guarantor continues to be benefited by this Guaranty and
Purchaser shall have no duty to inquire into or confirm the receipt of any such
benefits, and this Guaranty shall be effective and enforceable by Purchaser
without regard to the receipt, nature or value of any such benefits.

 

4.          Unconditional Nature. No act or thing need occur to establish any
Guarantor’s liability hereunder, and no act or thing, except Satisfaction in
Full of the Guaranteed Obligations (as defined below), shall in any way
exonerate any Guarantor hereunder or modify, reduce, limit or release any
Guarantor’s liability hereunder. This is an absolute, unconditional and
continuing guaranty of payment of the Guaranteed Obligations and shall continue
to be in force and be binding upon each Guarantor until Satisfaction in Full of
the Guaranteed Obligations. Each Guarantor agrees that this Guaranty is a
guaranty of Satisfaction in Full of the Guaranteed Obligations and not of
collection, and that its obligations under this Guaranty shall be primary,
absolute and unconditional.  In addition to the terms set forth herein, it is
expressly understood and agreed that, if, at maturity and at any time during the
continuance of an Event of Default, the outstanding amount of the Guaranteed
Obligations under the Transaction Documents (including, without limitation, all
accrued interest thereon, all accrued late charges thereon and all premiums due
in respect thereof) is declared to be immediately due and payable, then
Guarantors shall, upon notice of such acceleration, without further demand, pay
to Purchaser the entire outstanding Guaranteed Obligations due and owing to
Purchaser.

 

5.          Subrogation. No Guarantor will exercise or enforce any right of
contribution, reimbursement, recourse or subrogation available to such Guarantor
as to any of the Guaranteed Obligations, or against any Person liable therefor,
or as to any collateral security therefor, unless and until Satisfaction in Full
of the Guaranteed Obligations.

 

 

 

 

6.          Obligations Absolute. Each Guarantor agrees that its obligations
hereunder are irrevocable, absolute, independent and unconditional and shall not
be affected by any circumstance which constitutes a legal or equitable discharge
of a guarantor or surety other than Satisfaction in Full of the Guaranteed
Obligations. In furtherance of the foregoing and without limiting the generality
thereof, each Guarantor agrees that none of its obligations hereunder shall be
affected or impaired by any of the following acts or things (which Purchaser is
expressly authorized to do, omit or suffer from time to time, without consent or
approval by or notice to any Guarantor): (a) any acceptance of collateral
security, guarantors, accommodation parties or sureties for any or all of the
Guaranteed Obligations; (b) one or more extensions or renewals of the Guaranteed
Obligations (whether or not for longer than the original period) or any
modification of the interest rates, maturities, if any, or other contractual
terms applicable to any of the Guaranteed Obligations or any amendment or
modification of any of the terms or provisions of any of the Transaction
Documents; (c) any waiver or indulgence granted to Parent or any other Obligor,
any delay or lack of diligence in the enforcement of the Guaranteed Obligations,
or any failure to institute proceedings, file a claim, give any required notices
or otherwise protect any of the Guaranteed Obligations; (d) any full or partial
release of, compromise or settlement with, or agreement not to sue, Parent, any
other Obligor or any other Person liable in respect of any of the Guaranteed
Obligations; (e) any release, surrender, cancellation or other discharge of any
evidence of the Guaranteed Obligations or the acceptance of any instrument in
renewal or substitution therefor; (f) any failure to obtain collateral security
(including rights of setoff) for the Guaranteed Obligations, or to see to the
proper or sufficient creation and perfection thereof, or to establish the
priority thereof, or to preserve, protect, insure, care for, exercise or enforce
any collateral security; or any modification, alteration, substitution,
exchange, surrender, cancellation, termination, release or other change,
impairment, limitation, loss or discharge of any collateral security; (g) any
collection, sale, lease or disposition of, or any other foreclosure or
enforcement of or realization on, any collateral security; (h) any assignment,
pledge or other transfer of any of the Guaranteed Obligations or any evidence
thereof; (i) any manner, order or method of application of any payments or
credits upon the Guaranteed Obligations or (j) Purchaser not being a Permitted
Secured Party. Each Guarantor waives any and all defenses and discharges
available to a surety, guarantor or accommodation co-obligor.

 

7.          Waivers by Guarantors. Each Guarantor waives any and all defenses,
claims, setoffs and discharges of, and/or against, Parent or any other Obligor
or Person (including, without limitation, Purchaser), pertaining to the
Guaranteed Obligations, except the defense of discharge by indefeasible
satisfaction and discharge in full. Without limiting the generality of the
foregoing, no Guarantor will assert, plead or enforce against any Purchaser any
defense of waiver, release, discharge or disallowance in any Insolvency
Proceeding, statute of limitations, res judicata, statute of frauds,
anti-deficiency statute, fraud, incapacity, minority, usury, illegality or
unenforceability which may be available to Parent or any other Obligor or Person
liable in respect of any of the Guaranteed Obligations, or any setoff available
to any Purchaser against Parent or any other such Obligor or Person, whether or
not on account of a related transaction. Each Guarantor expressly agrees that
such Guarantor shall be and remain liable for any deficiency remaining after
foreclosure of any mortgage or security interest securing the Guaranteed
Obligations, whether or not the liability of Parent or any other Obligor or
Person for such deficiency is discharged pursuant to statute or judicial
decision. The liability of each Guarantor shall not be affected or impaired by,
and each Guarantor waives and agrees it shall not at any time insist upon, plead
or in any manner claim or take the benefit of, any voluntary or involuntary
liquidation, dissolution, sale or other disposition of all or substantially all
of the assets, marshalling of assets and liabilities, any valuation, appraisal,
stay, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of, or other
similar event or proceeding affecting, Parent or any of its assets. No Guarantor
will assert, plead or enforce against any Purchaser any claim, defense or setoff
available to such Guarantor against Parent. Each Guarantor waives presentment,
demand for payment, notice of dishonor or nonpayment and protest of any
instrument evidencing the Guaranteed Obligations. Purchaser shall not be
required first to resort for payment of the Guaranteed Obligations to Parent or
any other Person, or their properties, or first to enforce, realize upon or
exhaust any collateral security for the Guaranteed Obligations, before enforcing
this Guaranty.

 

 

 

 

8.          If Payments Set Aside, etc. If any payment applied by Purchaser to
the Guaranteed Obligations is thereafter set aside, recovered, rescinded or
required to be returned for any reason (including, without limitation, the
bankruptcy, insolvency or reorganization of Parent or any other Obligor or
Person), the Guaranteed Obligations to which such payment was applied shall for
the purpose of this Guaranty be deemed to have continued in existence,
notwithstanding such application, and this Guaranty shall be enforceable as to
such Guaranteed Obligations as fully as if such application had never been made.

 

9.          Additional Obligation of Guarantors. Each Guarantor’s liability
under this Guaranty is in addition to and shall be cumulative with all other
liabilities of such Guarantor to Purchaser as guarantor, surety, endorser,
accommodation co-obligor or otherwise of any of the Guaranteed Obligations,
without any limitation as to amount.

 

10.         No Duties Owed by Purchaser. Each Guarantor acknowledges and agrees
that Purchaser (a) has not made any representations or warranties with respect
to, (b) does not assume any responsibility to such Guarantor for, and (c) has no
duty to provide information to such Guarantor regarding, the enforceability of
any of the Guaranteed Obligations or the financial condition of Parent or any
other Obligor or Person. Each Guarantor has independently determined the
creditworthiness of Parent and the enforceability of the Guaranteed Obligations
and until Satisfaction in Full of the Guaranteed Obligations will independently
and without reliance on Purchaser continue to make such determinations.

 

11.         Miscellaneous.

 

(a)          This Guaranty may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party. In the event that any signature is delivered by
facsimile transmission or by an e-mail which contains a portable document format
(.pdf) file of an executed signature page, such signature page shall create a
valid and binding obligation of the party executing (or on whose behalf such
signature is executed) with the same force and effect as if such signature page
were an original thereof. Any party delivering an executed counterpart of this
Guaranty by facsimile or other electronic method of transmission also shall
deliver an original executed counterpart of this Guaranty but the failure to
deliver an original executed counterpart shall not affect the validity,
enforceability, and binding effect of this Guaranty.

 

(b)          Any provision of this Guaranty which is prohibited or unenforceable
shall be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof in that jurisdiction or
affecting the validity or enforceability of such provision in any other
jurisdiction.

 

 

 

 

(c)          Headings used in this Guaranty are for convenience only and shall
not be used in connection with the interpretation of any provision hereof.

 

(d)          The pronouns used herein shall include, when appropriate, either
gender and both singular and plural, and the grammatical construction of
sentences shall conform thereto.

 

(e)          Unless the context of this Guaranty or any other Transaction
Document clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the terms “includes”
and “including” are not limiting, and the term “or” has, except where otherwise
indicated, the inclusive meaning represented by the phrase “and/or.” The words
“hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Guaranty or
any other Transaction Document refer to this Guaranty or such other Transaction
Document, as the case may be, as a whole and not to any particular provision of
this Guaranty or such other Transaction Document, as the case may be. Section,
subsection, clause, schedule, and exhibit references herein are to this Guaranty
unless otherwise specified. Any reference in this Guaranty or in any other
Transaction Document to any agreement, instrument, or document shall include all
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements, thereto and thereof, as
applicable (subject to any restrictions on such alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements set forth herein). “Satisfaction in Full of the
Guaranteed Obligations” shall mean the indefeasible payment in full in cash and
discharge, or other satisfaction in accordance with the terms of the Transaction
Documents and discharge, of all Guaranteed Obligations in full. Any reference
herein to any Person shall be construed to include such Person’s permitted
successors and permitted assigns.

 

(f)          This Guaranty shall be effective upon delivery to Purchaser,
without further act, condition or acceptance by Purchaser, shall be binding upon
each Guarantor and the successors and assigns of each Guarantor, and shall inure
to the benefit of Purchaser and its participants, successors and assigns. This
Guaranty may not be waived, modified, amended, terminated, released or otherwise
changed except by a writing signed by each Guarantor and Purchaser.

 

(g)          The language used in this Guaranty will be deemed to be the
language chosen by the parties to express their mutual intent, and no rules of
strict construction will be applied against any party. For clarification
purposes, the Recitals are part of this Guaranty.

 

(h)          All dollar amounts referred to in this Guaranty and the other
Transaction Documents are in United States Dollars (“U.S. Dollars”), and all
amounts owing under this Guaranty and all other Transaction Documents shall be
paid in U.S. Dollars. All amounts denominated in other currencies shall be
converted in the U.S. Dollar equivalent amount in accordance with the Exchange
Rate on the date of calculation. “Exchange Rate” means, in relation to any
amount of currency to be converted into U.S. Dollars pursuant to this Guaranty,
the U.S. Dollar exchange rate as published in the Wall Street Journal on the
relevant date of calculation.

 

(i)          Judgment Currency.

 

 

 

 

(i)          If for the purpose of obtaining or enforcing judgment against any
Guarantor in any court in any jurisdiction it becomes necessary to convert into
any other currency (such other currency being hereinafter in this Section 11(i)
referred to as the “Judgment Currency”) an amount due in U.S. Dollars under this
Guaranty or any other Transaction Document, the conversion shall be made at the
Exchange Rate prevailing on the Trading Day (as defined in the Securities
Purchase Agreement) immediately preceding: (1) the date actual payment of the
amount due, in the case of any proceeding in the courts of New York or in the
courts of any other jurisdiction that will give effect to such conversion being
made on such date or (2) the date on which the foreign court determines, in the
case of any proceeding in the courts of any other jurisdiction (the date as of
which such conversion is made pursuant to this Section 11(i)(i) being
hereinafter referred to as the “Judgment Conversion Date”).

 

(ii)         If in the case of any proceeding in the court of any jurisdiction
referred to in Section 11(i)(i) above, there is a change in the Exchange Rate
prevailing between the Judgment Conversion Date and the date of actual payment
of the amount due, the applicable party shall pay such adjusted amount as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the Exchange Rate prevailing on the date of payment, will produce
the amount of U.S. Dollars which could have been purchased with the amount of
Judgment Currency stipulated in the judgment or judicial order at the Exchange
Rate prevailing on the Judgment Conversion Date.

 

(iii)        Any amount due from any Guarantor under this provision shall be due
as a separate debt and shall not be affected by judgment being obtained for any
other amounts due under or in respect of this Guaranty or any other Transaction
Document.

 

12.         Notices. All notices and other communications provided for hereunder
shall be given in the form and manner, and delivered to such addresses, as
specified in the Security Agreement.

 

13.         Governing Law; Jurisdiction; Service of Process; Jury Trial. All
questions concerning the construction, validity, enforcement and interpretation
of this Guaranty shall be governed by the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law provision or
rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of
New York. Each Guarantor hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the Borough of
Manhattan, New York, New York, for the adjudication of any dispute hereunder or
in connection herewith or with any transaction contemplated hereby or discussed
herein, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper; provided, however, any suit seeking enforcement of this Guaranty may
be brought, at Purchaser’s option, in the courts of any jurisdiction where
Purchaser elects to bring such action. Each Guarantor hereby irrevocably waives
personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Guaranty and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Without limitation of the foregoing, each Guarantor hereby irrevocably appoints
Parent as such Guarantor’s agent for purposes of receiving and accepting any
service of process hereunder. Nothing contained herein shall be deemed to limit
in any way any right to serve process in any manner permitted by law. EACH
GUARANTOR HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED
HEREBY.

 

[Signature page follows]

 

 

 

 

IN WITNESS WHEREOF, this Guaranty has been duly executed by each Guarantor as of
the date set forth above.

 

  boldface licensing + branding, a Nevada corporation           By: /s/ Nicole
Ostoya     Name: Nicole Ostoya     Title:   Chief Executive Officer  

 

[SECURED PARTIES SIGN BY EXECUTING OMNIBUS SIGNATURE PAGE

TO THE SECURITIES PURCHASE AGREEMENT]