EXECUTION VERSION


 


LIMITED GUARANTY OF PAYMENT

(Up to $1,000,000)


 


THIS LIMITED GUARANTY
OF PAYMENT (this “Guaranty”) is made as of the 7th day of December, 2012, by Steven Leber, Joseph Bernstein
and Dr. Robert Cohen (each, a “Guarantor” and together, the “Guarantors”), in favor of the
holders (“Lenders”) of the Secured Convertible Promissory Notes (the “Notes”) issued pursuant
to that certain Note Purchase Agreement, dated as of December 7, 2012, by and among Grandparents.com, Inc., a Delaware corporation
(the “Borrower”) and the Lenders (together with all extensions, renewals, modifications, substitutions and amendments
thereof, the “Note Purchase Agreement”).


 


RECITALS:



 


WHEREAS, the Lenders
are making loans to the Borrower in the principal amount of up to Three Million Five Hundred Thousand Dollars ($3,500,000) (“Loan”);


 


WHEREAS, the Loan
is secured by, among other things, that certain Security Agreement (together with all extensions, renewals, modifications, substitutions
and amendments thereof, the “Security Agreement”), dated as December 7, 2012, made by Borrower in favor of John
Thomas Financial, Inc., as the collateral agent (the “Collateral Agent”), and granting the Lenders a first priority
lien on all of the assets of the Borrower; and


 


WHEREAS, the Lenders
require as a condition to the making of the Loan that Guarantor shall have executed and delivered this Guaranty for the benefit
of the Lenders.


 


NOW, THEREFORE, in consideration of
the premises and other good and valuable consideration, the receipt of which is hereby acknowledged, and in order to induce Lenders
to make the Loan to Borrower, Guarantor hereby represents, warrants and covenants to Lenders as follows: 


 


1.  Guaranty
of Obligations.  Subject to the limitations contained herein, the Guarantors hereby, jointly and severally, unconditionally
guarantee the prompt payment of the Obligations, as hereinafter defined, and become surety for, the prompt payment and performance
thereof (including any interest accruing thereon after maturity, or after the filing of any petition in bankruptcy, or the commencement
of any insolvency, reorganization or like proceeding relating to the Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), whether direct or indirect (including those acquired by assignment or participation),
absolute or contingent, joint or several, due or to become due, now existing or hereafter arising; which arise out of or in connection
with the Loan from the Lenders to the Borrower; provided that notwithstanding anything to the contrary contained herein or elsewhere,
and for the avoidance of doubt, the Guarantors guarantee, and liability pursuant hereto with respect to the Obligations, shall
not in any event exceed the amount of One Million Dollars ($1,000,000) (the “Guaranteed Amount”); and any amendments,
extensions, renewals or increases and all costs and expenses of the Lenders (including reasonable attorneys' fees and expenses)
incurred in the documentation, negotiation, modification, enforcement, collection or otherwise in connection with any of the foregoing,
including the Notes, as more fully set forth herein (collectively, the “Obligations”). If the Borrower defaults
under any such Obligations, the Guarantors will pay the amount due to the Lenders.


 




    	 



    	 



    

 


If the Borrower defaults
under any such Obligations, the Guarantors will pay the Guaranteed Amount to the Lenders. The Guaranteed Amount shall be reduced
by any amounts which the Lenders may realize before or after maturity of the Obligations, by acceleration or otherwise, as a result
of payments made by or on behalf of the Borrower or by or on behalf of any other person or entity, other than the Guarantors primarily
or secondarily liable for the Obligations or any part thereof, or otherwise credited to the Borrower or such person or entity,
or as a result of the exercise of the Lenders’ rights with respect to any collateral for the Obligations or any part thereof,
on a pro rata basis in proportion to amounts realized by the Lenders with respect to amounts due under the Notes. Solely
for purposes of illustration, if the aggregate amount outstanding under the Notes is $3,500,000 and the Borrower repays $1,400,000
of such amount, the Guaranteed Amount shall be reduced by $400,000 to $600,000. Payments made to the Lenders by the Guarantor (other
than, directly or indirectly, from collateral or other persons or entities liable for any portion of the Obligations) after maturity
of the Obligations, by acceleration or otherwise, shall reduce the Guaranteed Amount.


 


2.  Nature
of Guaranty; Waivers.  This is a guaranty of payment and not of collection and the Lenders shall not be required
or obligated, as a condition of the Guarantors’ liability, to make any demand upon or to pursue any of its rights against
the Borrower, or to pursue any rights which may be available to it with respect to any other person who may be liable for the payment
of the Obligations.


 


This is an absolute,
unconditional, irrevocable and continuing guaranty and will remain in full force and effect until all of the Obligations have been
indefeasibly paid in full, and the Lenders has terminated this Guaranty. This Guaranty will remain in full force and effect even
if there is no principal balance outstanding under the Obligations at a particular time or from time to time. This Guaranty will
not be affected by any surrender, exchange, acceptance, compromise or release by the Lenders of any other party, or any other guaranty
or any security held by it for any of the Obligations, by any failure of the Lenders to take any steps to perfect or maintain its
lien or security interest in or to preserve its rights to any security or other collateral for any of the Obligations or any guaranty,
or by any irregularity, unenforceability or invalidity of any of the Obligations or any part thereof or any security or other guaranty
thereof. The Guarantors’ obligations hereunder shall not be affected, modified or impaired by any counterclaim, set-off recoupment,
deduction or defense based upon any claim the Guarantors, or any of them, may have (directly or indirectly) against the Borrower
or the Lenders, except payment or performance of the Obligations.


 


Notice of acceptance
of this Guaranty, notice of extensions of credit to the Borrower from time to time, notice of default, diligence, presentment,
notice of dishonor, protest, demand for payment, and any defense based upon the Lenders’ failure to comply with the notice
requirements under Sections 9-611 and 9-612 of the Uniform Commercial Code as in effect from time to time are hereby waived. The
Guarantor waives all defenses based on suretyship or impairment of collateral.


 




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The Lenders at any
time and from time to time, without notice to or the consent of the Guarantor, and without impairing or releasing, discharging
or modifying the Guarantor’s liabilities hereunder, may (a) change the manner, place, time or terms of payment or performance
of or interest rates on, or other terms relating to, any of the Obligations; (b) renew, substitute, modify, amend or alter,
or grant consents or waivers relating to any of the Obligations, any other guaranties, or any security for any Obligations or guaranties;
(c) apply any and all payments by whomever paid or however realized including any proceeds of any collateral, to any Obligations
of the Borrower in such order, manner and amount as the Lenders may determine in its sole discretion; (d) settle, compromise
or deal with any other person, including the Borrower or the Guarantor, with respect to any Obligations in such manner as the Lenders
deems appropriate in its sole discretion; (e) substitute, exchange or release any security or guaranty; or (f) take such actions
and exercise such remedies hereunder as provided herein.


 


3.  Repayments
or Recovery from the Lenders.  If any demand is made at any time upon the Lenders for the repayment or recovery
of any amount received by it in payment or on account of any of the Obligations and if the Lenders repays all or any part of such
amount by reason of any judgment, decree or order of any court or administrative body or by reason of any settlement or compromise
of any such demand, the Guarantor will be and remain liable hereunder for the amount so repaid or recovered up to the Guaranteed
Amount to the same extent as if such amount had never been received originally by the Lenders. The provisions of this Section will
be and remain effective notwithstanding any contrary action which may have been taken by the Guarantor in reliance upon such payment,
and any such contrary action so taken will be without prejudice to the Lenders’ rights hereunder and will be deemed to have
been conditioned upon such payment having become final and irrevocable.


 


4.  Enforceability
of Obligations.  No modification, limitation or discharge of the Obligations arising out of or by virtue of any
bankruptcy, reorganization or similar proceeding for relief of debtors under federal or state law will affect, modify, limit or
discharge the Guarantor’s liability in any manner whatsoever and this Guaranty will remain and continue in full force and
effect and will be enforceable against the Guarantor to the same extent and with the same force and effect as if any such proceeding
had not been instituted. The Guarantor waives all rights and benefits which might accrue to it by reason of any such proceeding
and will be liable to the full extent hereunder, irrespective of any modification, limitation or discharge of the liability of
the Borrower that may result from any such proceeding.


 


The Guarantor expressly
waives the effect of any statute of limitations or other limitations on any actions under this Guaranty.


 


5.  Events
of Default.  The occurrence of any of the following shall be an “Event of Default”: (i) any
Event of Default (as defined in the Note Purchase Agreement); (ii) any default under any of the Obligations that does not have
a defined set of “Events of Default” and the lapse of any notice or cure period provided in such Obligations with respect
to such default; (iii) any Guarantor’s failure to perform any of his obligations hereunder; (iv) the falsity, inaccuracy
or material breach by any Guarantor of any written warranty, representation or statement made or furnished to the Lenders by or
on behalf of any Guarantor; or (v) the termination or attempted termination of this Guaranty. Upon the occurrence of any Event
of Default, (a) the Guarantors shall pay to the Lenders the Guaranteed Amount; or (b) on demand of the Lenders, the Guarantors
shall immediately deposit with the Agents (as defined in the Note Purchase Agreement) on behalf of the Lenders, in U.S. dollars,
the Guaranteed Amount, and the Lenders may at any time use such funds to repay the Obligations; or (c) the Lenders in their discretion
may exercise with respect to any collateral any one or more of the rights and remedies provided a secured party under the applicable
version of the Uniform Commercial Code; or (d) the Lenders in their discretion may exercise from time to time any other rights
and remedies available to it at law, in equity or otherwise.


 




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6.  Costs.  To
the extent that the Lenders incur any costs or expenses in protecting or enforcing its rights under the Obligations or this Guaranty,
including reasonable attorneys’ fees and the costs and expenses of litigation, such costs and expenses will be due on demand,
will be included in the Guaranteed Amount and will bear interest from the incurring or payment thereof at the default rate (as
contemplated in any of the Obligations).


 


7.  Postponement
of Subrogation.  Until the Obligations are indefeasibly paid in full, expire, are terminated and are not subject
to any right of revocation or rescission, the Guarantors postpone and subordinate in favor of the Lenders or its designee (and
any assignee or potential assignee), any and all rights which the Guarantors or any of them may have to (a) assert any claim whatsoever
against the Borrower based on subrogation, exoneration, reimbursement, or indemnity or any right of recourse to security for the
Obligations with respect to payments made hereunder, and (b) any realization on any property of the Borrower, including participation
in any marshalling of the Borrower’s assets.


 


8.  Notices.  All
notices, demands, requests, consents, approvals and other communications required or permitted hereunder (“Notices”)
must be in writing and will be effective upon receipt. Notices may be given in any manner to which the Lenders and the Guarantor
may separately agree, including electronic mail as contemplated in the Note Purchase Agreement. Regardless of the manner in which
provided, Notices may be sent to addresses for the Lenders and the Guarantors as set forth above or to such other address as either
may give to the other for such purpose in accordance with this Section.


 


9.  Preservation
of Rights.  No delay or omission on the Lenders’ part to exercise any right or power arising hereunder
will impair any such right or power or be considered a waiver of any such right or power, nor will the Lenders’ action or
inaction impair any such right or power. The Lenders’ rights and remedies hereunder are cumulative and not exclusive of any
other rights or remedies which the Lenders may have under other agreements, at law or in equity. The Lenders may proceed in any
order against the Borrower, any Guarantor or any other obligor of, or any collateral securing, the Obligations.


 


10.  Illegality.  If
any provision contained in this Guaranty should be invalid, illegal or unenforceable in any respect, it shall not affect or impair
the validity, legality and enforceability of the remaining provisions of this Guaranty.


 


11.  Changes
in Writing.  No modification, amendment or waiver of, or consent to any departure by the Guarantor from, any
provision of this Guaranty, will be effective unless made in a writing signed by the Required Investors (as defined in the Note
Purchase Agreement) or by the Collateral Agent, who hereby is empowered and authorized to act on behalf of the Lenders, and then
such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice to or demand
on the Guarantor will entitle the Guarantor to any other or further notice or demand in the same, similar or other circumstance.


 




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12.  Entire
Agreement.  This Guaranty, the Note Purchase Agreement, the Notes and the Security Agreement (including the documents
and instruments referred to herein) constitutes the entire agreement and supersedes all other prior agreements and understandings,
both written and oral, between the Guarantors and the Lenders with respect to the subject matter hereof. Unless otherwise defined
herein, all capitalized terms used herein shall have the meanings ascribed thereto in the Note Purchase Agreement.


 


13.  Successors
and Assigns.  This Guaranty will be binding upon and inure to the benefit of the Guarantor and the Lenders and
their respective heirs, executors, administrators, successors and assigns; provided, however, that the Guarantor
may not assign this Guaranty in whole or in part without the Lenders’ prior written consent and the Lenders at any time may
assign this Guaranty in whole or in part.


 


14.  Interpretation.  In
this Guaranty, unless the Lenders and the Guarantors otherwise agree in writing, the singular includes the plural and the plural
the singular; references to statutes are to be construed as including all statutory provisions consolidating, amending or replacing
the statute referred to; the word “or” shall be deemed to include “and/or”, the words “including”,
“includes” and “include” shall be deemed to be followed by the words “without limitation”;
and references to sections or exhibits are to those of this Guaranty. Section headings in this Guaranty are included for convenience
of reference only and shall not constitute a part of this Guaranty for any other purpose.


 


15.  Indemnity.  The
Guarantors agree to indemnify each of the Lenders, each legal entity, if any, who controls the Lenders and each of their respective
directors, officers and employees (the “Indemnified Parties”), and to hold each Indemnified Party harmless from
and against, any and all claims, damages, losses, liabilities and expenses (including all fees and charges of internal and external
counsel with whom any Indemnified Party may consult and all expenses of litigation and preparation therefor) which any Indemnified
Party may incur or which may be asserted against any Indemnified Party by any person, entity or governmental authority (including
any person or entity claiming derivatively on behalf of any Guarantor, in connection with or arising out of or relating to the
matters referred to in this Guaranty, whether (a) arising from or incurred in connection with any breach of a representation, warranty
or covenant by any Guarantor, or (b) arising out of or resulting from any suit, action, claim, proceeding or governmental investigation,
pending or threatened, whether based on statute, regulation or order, or tort, or contract or otherwise, before any court or governmental
authority; provided, however, that the foregoing indemnity agreement shall not apply to any claims, damages, losses,
liabilities and expenses solely attributable to an Indemnified Party’s gross negligence or willful misconduct. The indemnity
agreement contained in this Section shall survive the termination of this Guaranty and assignment of any rights hereunder. Each
Guarantor may participate at its expense in the defense of any such claim.


 




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16.  Governing
Law and Jurisdiction.  This Guaranty has been delivered to and accepted by the Lenders and will be deemed to
be made in the State of New York. This Guaranty will be interpreted and the rights and
liabilities of the Lenders and the Guarantor determined in accordance with the laws of the State of New York, excluding its conflict
of laws rules. Each Guarantor hereby irrevocably consents to the exclusive jurisdiction of any state or federal court
in the County of New York; provided that nothing contained in this Guaranty will prevent the Lenders from bringing any action,
enforcing any award or judgment or exercising any rights against such Guarantor individually, against any security or against any
property of such Guarantor within any other county, state or other foreign or domestic jurisdiction. Each Guarantor acknowledges
and agrees that the venue provided above is the most convenient forum for both the Lenders and such Guarantor. Each Guarantor waives
any objection to venue and any objection based on a more convenient forum in any action instituted under this Guaranty.


 


17.  WAIVER
OF JURY TRIAL.  EACH GUARANTOR IRREVOCABLY WAIVES ANY AND ALL RIGHT SUCH GUARANTOR MAY HAVE TO A TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR CLAIM OF ANY NATURE RELATING TO THIS GUARANTY, ANY DOCUMENTS EXECUTED IN CONNECTION WITH THIS GUARANTY
OR ANY TRANSACTION CONTEMPLATED IN ANY OF SUCH DOCUMENTS. THE GUARANTOR ACKNOWLEDGES THAT THE FOREGOING WAIVER IS KNOWING AND VOLUNTARY.


 


The Guarantor acknowledges
that it has read and understood all the provisions of this Guaranty, including the waiver of jury trial, and has been advised by
counsel as necessary or appropriate.


 




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IN WITNESS WHEREOF,
the parties hereto have duly executed this Guaranty, as of the date first above written.


 


	 	/s/ Steven Leber
	 	Steven Leber
	 	 
	 	/s/ Joseph Bernstein
	 	Joseph Bernstein
	 	 
	 	/s/ Robert Cohen
	 	Dr. Robert Cohen


 


[Signature Page to Limited Guaranty of Payment]