SECOND AMENDED AND RESTATED EMPLOYMENT CONTRACT

THIS   SECOND   AMENDED   AND  RESTATED  CONTRACT  OF  EMPLOYMENT  (hereinafter
"Contract") is made in Indianapolis,  Indiana,  dated  and effective as amended
July  1,  1999,  by  and  between STANDARD MANAGEMENT CORPORATION,  an  Indiana
Corporation, and all wholly  owned subsidiaries of the above named corporations
(hereinafter the "Company"), and STEPHEN M. COONS (hereinafter "Executive").

                                   RECITALS

A.Executive  has participated in  the  organization  of  the  Company  and  its
business.

B.Executive has and is expected to continue to make a major contribution to the
profitability, growth and financial strength of the Company.

C.The Company  considers  the  continued services of the Executive to be in the
best interest of the Company and  its  shareholders  and  desires to assure the
continued services of the Executive on behalf of the Company  on  an  objective
and  impartial  basis  and  without distraction or conflict of interest in  the
event of an attempt to obtain control of the Company.

D.Executive is willing to remain  in  the employ of the Company under the terms
and conditions hereof and upon the understanding  that the Company will provide
him  with the income security herein if his employment  is  terminated  by  the
Company or if he voluntarily terminates his employment for good reason.

NOW, THEREFORE, in consideration of the mutual agreements contained herein, the
parties to this Contract hereby agree as follows:


                                   AGREEMENT

1.EMPLOYMENT.   The Company hereby agrees to employ Executive as Executive Vice
President, Secretary  and  General  Counsel  of the Company.  Executive accepts
such employment and agrees to be subject to the  general  supervision,  orders,
advice and direction of the President and Chief Executive Officer and the Board
of  Directors  of  the  Company  in  a  manner  consistent with the Articles of
Incorporation and By-Laws of the Company.  The Executive  shall be permitted to
maintain his personal representation of selected corporate  clients not adverse
to the interests of the Company.

2.TERMS  OF EMPLOYMENT AND COMPENSATION.  Executive's term of  employment  (the
"Employment  Term")  hereunder  shall  start on July 1, 1999 and continue until
such employment terminates pursuant to Section 7 hereof.

3.SALARY AND BONUS.  Executive's salary  for  the first year hereunder shall be
$203,000.00  per  year.   Thereafter  during the Employment  Term,  Executive's
salary shall be increased each year by  an  amount  equal to Executive's salary
for the previous year multiplied by the percent change  of  the  Consumer Price
Index  for  all Urban Consumers (the "CPI") (published by the Bureau  of  Labor
Statistics, United States Department of Labor) during the immediately preceding
calendar year.   For  example, if the percent change in the CPI from January 1,
1999 to December 31, 1999  were  5%,  Executive's  salary  for  the second year
hereunder  would  be $213,150.00.  Executive's salary shall be payable  on  the
Company's regular salary  payment dates.  In addition, within 90 days after the
end of each fiscal year during  the  Employment Term, Executive shall receive a
bonus.  The bonus paid to Executive shall  be one and one-half percent (1-1/2%)
of the annual gross operating income of the  Company  paid  within  ninety (90)
days after the close of each fiscal year covered hereunder.  Provided, however,
that in no event shall said bonus be less than ten percent (10%) of the  annual
salary of Executive for the year in consideration.

The salary and bonus payments hereunder shall be subject to withholding and any
other applicable tax law.

4.SALARY  GUARANTEE.  All salaries payable to the Executive under the Agreement
will be guaranteed  (the "Guaranteed Payments") as of the effective date of the
Agreement for the full Employment Term of the Agreement except for terminations
for violations found in Section 7(b) (c) (d) or (e) hereof.

(a)After the initial  three  year  Employment  Term of Guaranteed Payments, any
additional one year extensions made pursuant to  the terms of Section 7(a) will
be guaranteed once the notice period for the extension  or  termination  period
found in Section 7(a) has passed.

(b)None of the Guaranteed Payments described in this Section shall prevent  the
Executive  from  receiving  the Termination Benefits described in Section 13 of
the Agreement.

(c)All  Guaranteed Payments described  in  this  Section  and  payable  to  the
Executive  shall  be  payable to the Estate of Stephen M. Coons in the event of
death of the Executive.

(d)In the event of any  mental disability which renders the Executive unable to
fulfill his duties pursuant  to  Section  1  of  this Agreement, all Guaranteed
Payments shall be made to Stephen M. Coons's attorney  in  fact,  his  personal
representative,  his  guardian,  or  any other such person legally specifically
listed, to whomever is legally authorized  to receive monetary payments due and
owing to Stephen M. Coons.

(e)In the event of any physical disability which  renders  the Executive unable
or unwilling to fulfill his duties pursuant to Section 1 of this Agreement, all
Guaranteed Payments shall be made directly to the Executive.

(f)Upon  the  termination of Executive=s employment for any reason  other  than
pursuant to Section 7(b), (d) or (e) hereof, the Company shall pay to Executive
in a lump-sum payment, within thirty (30) calendar days after such termination,
the salary received  by  him on the date of such termination in an amount equal
to two (2) years of annual salary.

5.REIMBURSEMENT FOR EXPENSES.   The  Company shall, during the Employment Term,
reimburse Executive for all reasonable travel, business entertainment and other
business  expenses  incurred by Executive  in  rendering  services  under  this
Contract.   Such  reimbursement   shall  be  subject  to  compliance  with  the
applicable policies and procedures  established  by  the  Company.   During the
Employment  Term,  Executive  shall  be entitled to an automobile allowance  of
$500.00 per month.

6.FRINGE BENEFITS.  During the Employment  Term, Executive shall be entitled to
participate in the Company's corporate, medical and disability insurance plans.
The Company shall also provide Executive with term life insurance in the amount
of  $500,000.   Executive  shall  be  entitled to  all  other  fringe  benefits
generally  provided  for  salaried employees  of  the  Company  upon  attaining
eligibility as provided under such fringe benefit programs.  Executive shall be
entitled to four (4) weeks vacation per year.

7.TERMINATION.  The Employment  Term  shall  terminate on the first to occur of
the following events:

(a)the  third  anniversary  of the date on which  the  Employment  Term  become
effective; provided, however, that after such third anniversary, the Employment
Term shall be extended each year  thereafter  for an additional one year period
unless either party gives the other written notice at least 90 days before such
extension of its intention not to renew the Contract;

(b)termination by the Company for cause, upon written  notice  (specifying  the
particulars)  to  Executive  from the Company's Board of Directors, which cause
shall be limited to:

(i)  the persistent failure of  or  refusal  by  Executive  to  comply with the
material orders, advice, directions, policies, standard and regulations  of the
Company  and  its President or Board of Directors, as promulgated from time  to
time, or with the  provisions  of  this  Contract,  which failure or refusal is
detrimental to the Company;






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(ii)   an  act  or  acts of fraud or dishonesty by Executive  resulting  in  or
tending to result in  gain  to  or  personal  enrichment  of  Executive  at the
Company's expense;

(iii)  any felony conviction of Executive or material tort which is detrimental
to the Company; or

(iv)  the persistent absence of Executive from his employment without cause  or
explanation;

(c)the death of Executive;

(d)the  90th  day  after notice from the Company to Executive that Executive is
considered to be permanently  disabled  due  to  his  inability  to perform his
duties or fulfill his responsibilities hereunder, which inability existed for a
period of 90 days or more before such notice; or

(e)termination by Executive, at his option, after 90 days prior written  notice
to the Company.

Upon termination of Executive's employment pursuant to Section 7(b) (c) (d)  or
(e),  Executive  (or  his  estate) shall receive (i) any unpaid salary payments
with  respect to periods prior  to  the  date  of  termination,  and  (ii)  any
termination,  disability  or  death  benefits to which he is entitled under any
employee benefit plan of the Company which  is  in  effect  at  the time of the
termination  of his employment.  In all other events of termination,  Executive
shall continue to receive the Guaranteed Payments.

8.AGREEMENT NOT  TO  COMPETE.   Executive  agrees  that  if  his  employment is
terminated by the Company pursuant to Subsection 7(b) hereof he shall  not, for
a  period  of  one year from the date his employment hereunder terminates,  (x)
directly or indirectly  sell  or  attempt to sell, within Indiana, on behalf of
himself  or  any other person, corporation  or  entity,  any  type  of  product
marketed by the  Company at the time his employment is terminated, (y) directly
or indirectly sell  or  attempt  to  sell  any  type of product marketed by the
Company at the time his employment is terminated  to any person, corporation or
other entity that is a customer of the Company at the  time  his  employment is
terminated,  and  (z)  within  Indiana,  directly  or  indirectly, own, manage,
operate, control, be employed by, participate in, or be connected in any manner
with the ownership, management, operation, or control of  any  business similar
to the type of business conducted by the Company at the time of  termination of
Executive's employment hereunder; provided, however, that Executive  may  be  a
shareholder  of  less  than 5% of the outstanding shares of voting stock of any
company listed on a recognized  stock  exchange or traded in the NASD over-the-
counter market.

9.TECHNICAL  INFORMATION.   Executive covenants  and  agrees  that  during  the
Employment  Term and for a period  of  six  months  after  termination  of  the
Employment Term  (regardless  of  whether  Executive  is terminated or defaults
under any other provision of this Contract) he will assign  to  the  Company or
its  nominees  all  of  his  right, title and interest in and to all "Technical
Information" (as hereinafter defined)  which  he  makes, develops or conceives,
either alone or in conjunction with others; he will  disclose  promptly  to the
Company  all such Technical Information; and he will cooperate with the Company
in  its  efforts   to  protect  its  rights  of  ownership  in  such  Technical
Information.  For purposes of this Contract, "Technical Information" shall mean
and  include,  but  not  be  limited  to,  all  software,  processes,  devices,
trademarks, trade names,  copyrights,  marketing plans, improvements, and ideas
relating to the business of the Company,  and  all goodwill associated with any
such item.

10.COVENANT  AGAINST  DISCLOSURE  OF  TECHNICAL AND  CONFIDENTIAL  INFORMATION.
Executive agrees that while he is employed  by  the  Company  and thereafter he
shall  not,  directly  or indirectly, disclose or use to the detriment  of  the
Company or for the benefit  of  any  other person, corporation or other entity,
any confidential information or trade  secret  (including,  but not limited to,
the  identity  and  needs  of  any  customer  of  the  Company, the method  and
techniques of any of the business of the Company, the marketing,  sales,  costs
and  pricing  plans  and objectives of the Company, the problems, developments,
research records, and  Technical  Information)  of  the  Company, or any of the
affiliates  of the Company.  Furthermore, Executive shall deliver  promptly  to
the Company upon  termination of his employment, or at any time the Company may
so request, all memoranda,  notes, records, reports, manuals, software, models,
designs, and other documents  and  computer  records  (and  all copies thereof)
relating to the business of the Company, and all property associated therewith,
which he may then possess or have under his control.  This Contract supplements
and does not supersede Executive's obligations under statute  or the common law
to protect the Company's trade secrets and confidential information.

11.REMEDY.  Executive acknowledges that the restrictions contained  in Sections
8  through  10 of this Contract are reasonable and that the legal remedies  for
breach of the  covenants  which  are contained in Sections 8 through 10 of this
Contract may be inadequate and, therefore,  agrees  that,  in  the event of any
actual  or  threatened  breach of any such covenant, in addition to  any  other
right or remedy which the Company may have, the Company may:  (a) seek specific
enforcement of any such covenant  through injunction or other equitable relief,
and (b) recover from Executive an amount  equal  to  (i)  all  sums paid by the
Company  to  him  after  commencement  of  the breach, plus (ii) all costs  and
expenses (including attorneys' fees) incurred  by the Company in enforcement of
the covenant, plus (iii) all other damages to which  the Company may be legally
entitled.

12.UNDERTAKING  TO  PAY  TERMINATION  BENEFITS.  In addition  to  the  payments
Executive shall receive under Section 4  hereof in the event of the termination
of his employment, the Company agrees to pay  to  the Executive the Termination
Benefits  specified  in  Section 13 hereof if (a) control  of  the  Company  is
acquired (as defined in paragraph  14(a)  hereof)  and  (b)  within three years
after  the  acquisition  of  control  occurs  (i)  the  Company terminates  the
employment  of Executive for any reason other than pursuant  to  Section  7(b),
7(c) or 7(d)  hereof,  or  (ii) Executive voluntarily terminates his employment
for good reason (as defined in Section 14(b) hereof).

13.TERMINATION BENEFITS.  If  Executive  is  entitled  to  termination benefits
pursuant  to  paragraph  12 hereof, the Company agrees to pay to  Executive  as
termination compensation in a lump-sum payment within five calendar days of the
termination of Executive's  employment  an amount to be computed by multiplying
(a) Executive's average annual compensation  payable  by  the  Company which is
includable in the gross income of Executive for the most recent  five  calendar
years ending coincident with or immediately before the date on which control of
the  Company is acquired (or such portion of such period during which Executive
was an  employee  of  the Company, by (b) 299%.  For purposes of this Contract,
employment and compensation  paid  by  an  direct or indirect subsidiary of the
Company, if any will be deemed to be employment  and  compensation  paid by the
Company.

(a)The  Termination  Benefits  described  in  this  section are payable to  the
Executive regardless of any determination by the Company's  independent  public
accountants  that  payments  made pursuant to this section are or would be non-
deductible by the Company for  federal  income  tax purposes because of Section
280G of the Internal Revenue Code of 1986 or any  subsequent  revisions  in the
Internal Revenue Code.

14.DEFINITIONS.

(a)As  used in this Contract, the "acquisition of control": means (i) attaining
ownership  of  25%  or more of the shares of voting stock of the Company by any
person or group (other  than a person or group including Executive or with whom
or which Executive is affiliated),  or  (ii)  the  occurrence  of  a "change of
control"  required  to  be  described  under the proxy disclosure rules of  the
Securities and Exchange Commission.

(b)As used in this Contract, the term "good  reason" means, without Executive's
written   consent,   (i)   a   change  in  Executive's  status,   position   or
responsibilities  which,  in his reasonable  judgment,  does  not  represent  a
promotion  from  his  status,   position   or  responsibilities  as  in  effect
immediately prior to the change in control;  the assignment to Executive of any
duties or responsibilities which, in his reasonable  judgment, are inconsistent
with  such status, position or responsibilities; or any  removal  of  Executive
from or failure to reappoint or reelect him to any of such positions, except in
connection  with  the  termination  of  his  employment for total and permanent
disability, death or pursuant to Subsection 7(ii)  or  7(iii)  herein or by him
other than for good reason; (ii) a breach by the Company of its covenants under
this Contract after a change in control; (iii) the relocation of  the Company's
principal  executive  offices  to a location outside the Indianapolis,  Indiana
metropolitan area or the Company's requiring him to be based at any place other
than the location at which he performed his duties prior to a change in control
except for required travel on the Company's business to an extent substantially
consistent with his business travel  obligations  at  the  time  of a change in
control; (iv) the failure by the Company to continue to provide Executive  with
benefits  substantially  similar  to  those  enjoyed  by him or to which he was
entitled  under any of the Company's pension, profit sharing,  life  insurance,
medical, dental,  health  and  accident,  or  disability  plans in which he was
participating at the time of a change in control, the taking  of  any action by
the  Company which would directly or indirectly materially reduce any  of  such
benefits  or  deprive  him  of any material fringe benefit enjoyed by him or to
which he was entitled at the  time  of the change in control, or the failure by
the Company to provide him with the number of paid vacation and sick leave days
to which he is entitled on the basis  of  years  of service with the Company in
accordance  with  the Company's normal vacation and  sick  leave  policies  and
consistent with Section  6  of this Contract; (v) the failure of the Company to
obtain a satisfactory agreement  from any successor or assign of the Company to
assume and agree to perform this Contract;  (vi)  any  purported termination of
Executive's  employment  which  is  not  effected  pursuant  to   a  Notice  of
Termination  satisfying  the requirements of Subsection 15(c) hereof  (and,  if
applicable, Subsection 7(b) hereof); and for purposes of this Contract, no such
purported termination shall  be  effective; or (vii) any request by the Company
that Executive participate in an unlawful act or take any action constituting a
breach of Executive's professional standard of conduct.

Notwithstanding anything in this paragraph  14(b)  to the contrary, Executive's
right to terminate his employment pursuant to paragraph  12 herein shall not be
affected by his incapacity due to physical or mental illness.

15.ADDITIONAL PROVISIONS RELATING TO TERMINATION.

(a)The  Company  is  aware that the Board of Directors or shareholders  of  the
Company may then cause or attempt to cause the Company to refuse to comply with
its obligations under  this  Contract,  or  may  cause  or attempt to cause the
Company to institute, or may institute litigation seeking to have this Contract
declared unenforceable, or may take or attempt to take action to deny Executive
the benefits intended under this Contract.  In these circumstances, the purpose
of  this Contract could be frustrated.  It is the intent of  the  Company  that
Executive not be required to incur the expenses associated with the enforcement
of his  rights  under this Contract by litigation or other legal action, nor be
bound to negotiate any settlement of his rights hereunder, because the cost and
expense of such legal action or settlement would substantially detract from the
benefits intended  to  be  extended  to  Executive  hereunder.  Accordingly, if
following  a  change  in  control, if it should appear to  Executive  that  the
Company has failed to comply with any of its obligations under this Contract or
in the event that the Company  or  any other person takes any action to declare
this Contract void or unenforceable,  or  institutes  any  litigation  or other
legal  action  designed  to  deny,  diminish  or  to recover from Executive the
benefits entitled to be provided to Executive hereunder, and that Executive has
complied  with  all  of  his  obligations  under  this  Contract,  the  Company
irrevocably  authorizes Executive from time to time to retain  counsel  of  his
choice, at the  expense of the Company as provided in this Subsection 15(a), to
represent Executive  in  connection  with  the  initiation  or  defense  of any
litigation  or  other  legal  action,  whether such action is by or against the
Company or any director, officer, shareholder,  or other person affiliated with
the  Company,  in  any jurisdiction.  Notwithstanding  any  existing  or  prior
attorney-client relationship  between the Company and such counsel, the Company
irrevocably consents to Executive entering into an attorney-client relationship
with such counsel, and in that  connection the Company and Executive agree that
a confidential relationship shall  exist  between  Executive  and such counsel.
The  reasonable  fees  and expenses of counsel selected from time  to  time  by
Executive as hereinabove  provided  shall be paid or reimbursed to Executive by
the Company on a regular, periodic basis  upon  presentation  by Executive of a
statement  or  statements  prepared  by  such  counsel in accordance  with  its
customary practices, up to a maximum aggregate amount of $50,000.00.  Any legal
expenses incurred by the Company by reason of any  dispute  between the parties
as   to   enforceability   of   or   the  terms  contained  in  this  Contract,
notwithstanding  the  outcome  of  any  such   dispute,   shall   be  the  sole
responsibility  of  the  Company, and the Company shall not take any action  to
seek reimbursement from Executive for such expenses.

(b)  The amounts payable to  Executive under this Contract shall not be treated
as damages but as severance compensation  to  which  Executive  is  entitled by
reason  of  termination of his employment in the circumstances contemplated  by
this Contract.   The  Company  shall  not  be  entitled  to set off against the
amounts  payable  to  Executive  of  any amounts earned by Executive  in  other
employment after termination of his employment with the Company, or any amounts
which might have been earned by Executive  in  other  employment  had he sought
such other employment.

(c)Any   purported  termination  by  the  Company  or  by  Executive  shall  be
communicated  by  written  Notice  of  Termination to the other party hereto in
accordance with Section 22 hereof.  For purposes of this Contract, a "Notice of
Termination" shall mean a notice which shall  indicate the specific termination
provision in this Contract relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide  a  basis for termination of his
employment under the provision so indicated.  For purposes of this Contract, no
such  purported  termination  shall  be  effective  without   such   Notice  of
Termination.

(d)In  addition  to  any  payments,  termination benefits or any other benefits
Executive  is entitled to receive hereunder,  in  the  event  of  a  change  or
acquisition  of  control,  the  Company  agrees  to  pay the Payment Amount (as
hereinafter defined) to the Executive in a lump-sum payment  within thirty (30)
calendar days after the termination of Executive=s employment  for  any reason,
including,  without  limitation,  termination  of  employment  by  the Company,
termination  of  employment  by the Executive and termination of employment  by
reason of death.  The APayment  Amount@  shall be the product, determined as of
the  date  of  Executive=s  termination  of  employment,   determined   by  (i)
multiplying the number of shares of common stock of the Company then subject to
unexercised  options  (AUnexercised  Options@) held by the Executive which were
granted by the Company or an affiliate  of  the Company by (ii) the highest per
share  fair  market value of the common stock on  any  day  during  the  period
beginning six  (6)  months  prior  to  the  date  of Executive=s termination of
employment.  For purposes of this provision, Unexercised  Options shall include
all outstanding options whether or not they are exercisable  at the time of the
election  by Executive hereunder.  There shall be no deduction  of  Executive=s
exercise price  per  share  for  each  Unexercised Option from the amount to be
received by him pursuant to this subsection  (d).   Upon payment by the Company
of the Payment Amount in accordance with this subsection  (d),  the Unexercised
Options shall be deemed to be surrendered by the Executive and cancelled by the
Company.   Such  cancellation  shall  be  effective  regardless of whether  the
Executive surrenders an agreement relating to any Unexercised Option.

16.ENTIRE  AGREEMENT.   This  Contract  contains the entire  agreement  of  the
parties relating to the employment of Executive by the Company, superseding any
and all prior such agreements, and cannot be amended, modified, or supplemented
in  any respect except by subsequent written  agreement  entered  into  by  the
parties.   The  First  Amended  and  Restated  Employment  Contract  dated  and
effective March 1, 1993 shall terminate in all respects on July 1, 1999.

17.BENEFIT.  Executive acknowledges that the services to be rendered to him are
unique and personal; accordingly, Executive may not assign any of his rights or
delegate  any of his duties or obligations under this Contract.  The rights and
obligations  of  the Company under this Contract shall inure to the benefit of,
and be binding upon,  the  legal representatives, successors and assigns of the
Company.

18.NO WAIVER.  No failure on  the  part  of either party at any time to require
the performance by the other party of any  term of this Contract shall be taken
or held to be a waiver of such term or in any  way affect such party's right to
enforce such term, and no waiver on the part of  either  party  of  any term in
this Contract shall be taken or held to be a waiver of any other term hereof or
the breach thereof.

19.SEVERABILITY.  The provisions of Sections 8 through 11 hereof are severable,
and the invalidity or unenforceability of any particular provision of  Sections
8  through  11  shall  not  affect  or  limit  the  enforceability of the other
provisions.   If  any  provision  in  Sections  8  through 11  hereof  is  held
unenforceable for any reason, including the time period,  geographic  area,  or
scope  of  activity  covered, then such provision shall be enforced to whatever
extent is reasonable and enforceable.

20.GOVERNING LAW.  This  Contract shall be governed and construed in accordance
with the law of the State  of  Indiana  (other  than the provisions relating to
choice of law).  The Contract may be brought in any  state  or federal court of
record  in  Indianapolis,  Indiana and the parties hereto waive  any  right  to
question the jurisdiction of  such  court  over their person or the property of
such venue.

21.CAPTIONS.   The  captions  in  this  Contract   are   for   convenience  and
identification  purposes  only, and not an integral part of this Contract,  and
are not to be considered in the interpretation of any part hereof.

22.NOTICES.  All notices and other communications hereunder shall be in writing
and shall be deemed to have  been  duly  given  if  in  writing  and personally
delivered to the party to whom notice should be given or if sent by  registered
or certified mail, postage prepaid, addressed to the addresses set forth below,
or to such other addresses as shall be furnished in writing by either  party to
the other:

Stephen M. Coons
9100 Keystone Crossing, Suite 600
Indianapolis, IN  46240

To the Company:

Standard Management Corporation
9100 Keystone Crossing, Suite 600
Indianapolis, IN  46240
Attn: Ronald D. Hunter, Chairman






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IN WITNESS WHEREOF, the Company has caused this Contract to be executed  on its
behalf  by  its duly authorized officer and Executive has hereunto set his hand
as of  the 1st day of July, 1999.


STANDARD MANAGEMENT CORPORATION
AND ALL WHOLLY OWNED SUBSIDIARIES


By:
Ronald D. Hunter,
Chairman, President and Chief Executive Officer

Attest:



Edward T. Stahl,
Executive Vice President

EXECUTIVE




Stephen M. Coons















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