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GUARANTY
<br /> Elk River, Minnesota
<br /> February , 2008
<br /> FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which is hereby
<br /> acknowledged, and in consideration of and to induce financial accommodations of any kind, with or
<br /> without security, given or to be given or continued at any time and from time to time by the ECONOMIC
<br /> DEVELOPMENT AUTHORITY OF THE CITY OF ELK RIVER(hereinafter called the "Lender")to
<br /> or for the account of NICOLE'S FINISHING TOUCH SALON, INC. (hereinafter collectively called
<br /> the "Borrower"), the undersigned absolutely and unconditionally guarantees to the Lender the full and
<br /> prompt payment when due, whether at maturity or earlier by reason of acceleration or otherwise, of any
<br /> and all indebtedness, obligations and liabilities of the Borrower (and any and all successors of the
<br /> Borrower) to the Lender and also to others to the extent of their participations granted to or interests
<br /> therein created or acquired for them by the Lender, now or hereafter existing, absolute or contingent,
<br /> independent,joint, several or joint and several, secured or unsecured, due or to become due, contractual or
<br /> tortious, liquidated or unliquidated, arising by assignment or otherwise, including without limitation all
<br /> indebtedness, obligations and liabilities owed by the Borrower (and any and all successors of the
<br /> Borrower) as a member of any partnership, syndicate, association or other group, and whether incurred by
<br /> the Borrower (or any successor of the Borrower) as principal, surety, endorser, guarantor, accommodation
<br /> party or otherwise (hereinafter collectively referred to as the "Indebtedness"); and the undersigned agrees
<br /> to pay on demand all of the Lender's fees, costs, expenses and reasonable attorneys'fees in connection with
<br /> the Indebtedness, any security therefor, and this guaranty, plus interest on such amounts at the highest rate
<br /> then applicable to any of the Indebtedness.
<br /> The Lender may at any time and from time to time, without consent of or notice to the
<br /> undersigned, without incurring responsibility to the undersigned, without releasing, impairing or affecting
<br /> the liability of the undersigned hereunder,upon or without any terms or conditions, and in whole or in part:
<br /> (1) sell, pledge, surrender, compromise, settle, release, renew, subordinate, extend, alter, substitute,
<br /> exchange, change, modify or otherwise dispose of or deal with in any manner and in any order any
<br /> Indebtedness, any evidence thereof, or any security or other guaranty therefor; (2)accept any security for or
<br /> other guarantors of any Indebtedness; (3) fail, neglect or omit to obtain, realize upon or protect any
<br /> Indebtedness or any security therefor, to exercise any lien upon or right to any money, credit or property
<br /> toward the liquidation of the Indebtedness, or to exercise any other right against the Borrower, the
<br /> undersigned, any other guarantor or any other person; and (4) apply any payments and credits to the
<br /> Indebtedness in any manner and in any order. No act, omission or thing, except full payment and
<br /> discharge of the Indebtedness, which but for this provision could act as a release or impairment of the
<br /> liability of the undersigned hereunder, shall in any way release, impair or otherwise affect the liability of
<br /> the undersigned hereunder, and the undersigned waives any and all defenses of the Borrower pertaining to
<br /> the Indebtedness, any evidence thereof, and any security therefor, except the defense of discharge by
<br /> payment. The failure of any person or persons to sign this or any other guaranty shall not release,impair or
<br /> affect the liability of the undersigned hereunder. This guaranty is a primary obligation of the undersigned
<br /> and the Lender shall not be required to first resort for payment of the Indebtedness to the Borrower or any
<br /> other person, their properties or estates, or any security or other rights or remedies whatsoever. The
<br /> undersigned shall be and remain liable for any deficiency remaining after foreclosure of any mortgage or
<br /> security interest securing the Indebtedness, whether or not the liability of the Borrower or any other person
<br /> for such deficiency is discharged pursuant to statute,judicial decision or otherwise.
<br /> The liability of the undersigned under this guaranty is joint and several and is in addition to and
<br /> shall be cumulative with all other liabilities of the undersigned to the Lender, as guarantor or otherwise,
<br /> without any limitation as to amount, unless the writing evidencing or creating such other liability
<br /> specifically provides to the contrary. If any payment applied by the Lender to the Indebtedness is
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