SUBSIDIARY
GUARANTY
THIS SUBSIDIARY GUARANTY (this “ Subsidiary Guaranty
”), dated as of May 15, 2009, among Wellstar International
Inc., a Nevada corporation (the “ Company ”),
Trillennium Medical Imaging, Inc., an Ohio corporation
(individually a “ Subsidiary Guarantor ” and
collectively, the “ Subsidiary Guarantors ”),
for the benefit of the secured parties signatory hereto and their
respective endorsees, transferees and assigns (individually a
“ Secured Party ” and collectively, the “
Secured Parties ”).
WITNESSETH
:
WHEREAS, pursuant to a Securities Purchase
Agreement, dated the date hereof, between Company and the Secured
Parties (the “ Purchase Agreement ”), Company
has agreed to issue to the Secured Parties and the Secured Parties
have agreed to purchase from Company certain of Company’s 13%
Callable Secured Convertible Notes, due three years from the date
of issue (the “ Notes ”), which are convertible
into shares of Company’s Common Stock, par value $.001 per
share (the “ Common Stock ”); and
WHEREAS, the Company and the Subsidiary
Guarantors have been, and are now, engaged in developing and
licensing the use of advanced thermal imaging technology in the
consumer health care and veterinary markets throughout the
U.S. In the past, as now, the Company has provided
financing for the Subsidiary Guarantors, and the Subsidiary
Guarantors have relied upon the Company to provide such
financing. In addition, it is anticipated that, if the
Subsidiary Guarantors execute and deliver this Subsidiary Guaranty,
the Company will continue to provide such financing to the
Subsidiary Guarantors, and that the proceeds of the Purchase
Agreement and Notes will be used, in part, for the
general working capital purposes of the Subsidiary Guarantors;
and
WHEREAS, the Subsidiary Guarantors constitute
all of the subsidiaries of the Company and it is in the best
interest of the Subsidiary Guarantors as subsidiaries of the
Company and the indirect beneficiaries of the Purchase Agreement
and Notes, that the Secured Parties enter into the Purchase
Agreement and purchase the Notes to the Company; and
WHEREAS, as a material inducement to the Secured
Parties to enter into the Purchase Agreement and Notes, the Secured
Parties have required and the Subsidiary Guarantors have agreed to
unconditionally guarantee the timely and full satisfaction of all
obligations of the Company, whether matured or unmatured, now or
hereafter existing or created and becoming due and payable (the
“ Obligations ”) to the Secured Parties, their
successors, endorsees, transferees or assigns under the Transaction
Documents (as defined in the Purchase Agreement); and
WHEREAS, in light of the foregoing, each
Subsidiary Guarantor expects to derive substantial benefit from the
Purchase Agreement and sale of the Notes and the transactions
contemplated thereby and, in furtherance thereof, has agreed to
execute and deliver this Subsidiary Guaranty.
NOW, THEREFORE, in consideration of the
foregoing recitals, and the mutual covenants contained herein, the
parties hereby agree as follows:
1.
Guaranty . The Subsidiary Guarantors, jointly and
severally, hereby absolutely, unconditionally and irrevocably
guarantee to the Secured Parties, their successors, endorsees,
transferees and assigns the due and punctual performance and
payment of the Obligations owing to the Secured Parties, their
successors, endorsees, transferees or assigns when due, all at the
time and place and in the amount and manner prescribed in, and
otherwise in accordance with, the Transaction Documents, regardless
of any defense or set-off counterclaim which the Company or any
other person may have or assert, and regardless of whether or not
the Secured Parties or anyone on behalf of the Secured Parties
shall have instituted any suit, action or proceeding or exhausted
its remedies or taken any steps to enforce any rights against the
Company or any other person to compel any such performance or
observance or to collect all or part of any such amount, either
pursuant to the provisions of the Transaction Documents or at law
or in equity, and regardless of any other condition or
contingency.
2. Waiver
of Demand . The Subsidiary Guarantors hereby
unconditionally: (i) waives any requirement that the
Secured Parties, in the event of a breach in any material respect
by the Company of any of its representations or warranties in the
Transaction Documents, first make demand upon, or seek to enforce
remedies against, the Company or any other person before demanding
payment of enforcement hereunder; (ii) covenants that this
Subsidiary Guaranty will not be discharged except by complete
performance of all the Obligations; (iii) agrees that this
Subsidiary Guaranty shall remain in full force and effect without
regard to, and shall not be affected or impaired, without
limitation, by, any invalidity, irregularity or unenforceability in
whole or in part of the Transaction Documents or any limitation on
the liability of the Company thereunder, or any limitation on the
method or terms of payment thereunder which may now or hereafter be
caused or imposed in any manner whatsoever; and (iv) waives
diligence, presentment and protest with respect to, and notice of
default in the performance or payment of any Obligation by the
Company under or in connection with the Transaction
Documents.
3.
Absolute Obligation . Each Subsidiary Guarantor
acknowledges and agrees that (i) no Secured Party has made any
representation or warranty to such Subsidiary Guarantor with
respect to the Company, any of its subsidiaries, any Transaction
Documents or any agreement, instrument or document executed or
delivered in connection therewith, or any other matter whatsoever,
and (ii) such Subsidiary Guarantor shall be liable hereunder, and
such liability shall not be affected or impaired, irrespective of
(A) the validity or enforceability of any Transaction Documents, or
any agreement, instrument or document executed or delivered in
connection therewith, or the collectability of any of the
Obligations, (B) the preference or priority ranking with respect to
any of the Obligations, (C) the existence, validity, enforceability
or perfection of any security interest or collateral security under
any Transaction Documents, or the release, exchange, substitution
or loss or impairment of any such security interest or collateral
security, (D) any failure, delay, neglect or omission by any
Secured Party to realize upon or protect any direct or indirect
collateral security, indebtedness, liability or obligation, any
Transaction Documents, or any agreement, instrument or document
executed or delivered in connection therewith, or any of the
Obligations, (E) the existence or exercise of any right of set-off
by any Secured Party, (F) the existence, validity or enforceability
of any other guaranty with respect to any of the Obligations, the
liability of any other person in respect of any of the Obligations,
or the release of any such person or any other guarantor of any of
the Obligations, (G) any act or omission of any Secured Party in
connection with the administration of any Transaction Documents or
any of the Obligations, (H) the bankruptcy, insolvency,
reorganization or receivership of, or any other proceeding for the
relief of debtors commenced by or against, any person, (I) the
disaffirmance or rejection, or the purported disaffirmance or
purported rejection, of any of the Obligations, any Transaction
Documents, or any agreement, instrument or document executed or
delivered in connection therewith, in any bankruptcy, insolvency,
reorganization or receivership, or any other proceeding for the
relief of debtor, relating to any person, (J) any law, regulation
or decree now or hereafter in effect which might in any manner
affect any of the terms or provisions of any Transaction Documents,
or any agreement, instrument or document executed or delivered in
connection therewith or any of the Obligations, or which might
cause or permit to be invoked any alteration in the time, amount,
manner or payment or performance of any of the Company's
obligations a
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