XFIT BRANDS, INC.

 

STOCK PURCHASE AGREEMENT

 

This Stock Purchase Agreement (“Agreement”) is made as of June 26, 2015, but is
only effective as of the date of acceptance of the “Purchaser Signature Page” by
and between XFit Brands, Inc., a Nevada corporation (the “Company”) and Yayu
General Machinery Co., LTD (the “Purchaser”).

 

R E C I T A L S

 

A. The Company desires to obtain manufacturing credit from the Purchaser in
order to manufacture for the Company certain Fitness and Combat Sports equipment
(“Fitness and Combat Sports Equipment”) of the Company, as listed on Exhibit A.

 

B. In order to obtain such credit, the Company is offering 40,000 shares (the
“Shares”) of the Company’s common stock (the “Common Stock”) on the terms and
subject to the conditions set forth herein.

 

AGREEMENT

 

It is agreed as follows:

 

1. CONSIDERATION. In reliance upon the representations and warranties of the
Company and the Purchaser contained herein and subject to the terms and
conditions set forth herein, at Closing, the Purchaser shall purchase, and the
Company shall sell and issue to the Purchaser the Shares for a purchase price of
$5.00 per share, or $200,000.00 (the “Purchase Price”). The Purchase Price shall
be in the form of a vendor credit of $200,000.00 in favor of the Company (the
“Vendor Credit”). The Company can use all or part of the Vendor Credit at any
time and from time to time until the Vendor Credit is exhausted.

 

As additional consideration, the Purchaser agrees that it will manufacture
Fitness and Combat Sport Equipment exclusively for the Company so long as the
Company has ordered any Fitness and Combat Sport Equipment through the Purchaser
in any trailing twelve (12) month period.

 

2. CLOSING.

 

2.1 Date and Time. The closing of the sale of the Shares contemplated by this
Agreement (the “Closing”) shall take place at the offices of the Company
concurrently herewith.

 

2.2 Deliveries by Purchaser. Purchaser shall deliver the following on or before
the Closing:

 

2.2.1 a completed and executed Purchaser Signature Page

 

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2.2.2 a statement of account evidencing the issuance of the Vendor Credit to the
Company in the amount of the Purchase Price.

 

2.3 Deliveries by Company. The Company shall deliver the following at Closing:

 

2.3.1 a completed and executed copy of this Agreement

 

2.3.2 the certificate(s) representing the Shares purchased by Purchaser, with
each such Share being in definitive form and registered in the name of the
Purchaser’s Nominee, Li Mao as set forth on the Purchaser Signature Page (or, in
the alternative, evidence that the Shares have been issued in book-entry form)
against delivery to the Company by the Purchaser of the items set forth in
paragraph 2.2 above.

 

3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

 

As a material inducement to the Purchaser to enter into this Agreement and to
purchase the Shares, the Company represents and warrants that the following
statements are true and correct in all material respects as of the date hereof
and will be true and correct in all material respects at Closing, except as
expressly qualified or modified herein.

 

3.1 Organization and Good Standing. The Company is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Nevada and
has full corporate power and authority to enter into and perform its obligations
under this Agreement, and to own its properties and to carry on its business as
presently conducted and as proposed to be conducted.

 

3.2 Validity of Transactions. This Agreement, and each document executed and
delivered by the Company in connection with the transactions contemplated by
this Agreement, including this Agreement, have been duly authorized, executed,
and delivered by the Company and is each the valid and legally binding
obligation of the Company, enforceable in accordance with its terms, except as
limited by applicable bankruptcy, insolvency, reorganization and moratorium laws
and other laws affecting enforcement of creditor’s rights generally and by
general principles of equity.

 

3.3 Valid Issuance of Shares. The Shares have been duly and validly authorized,
and, upon issuance will be, validly issued, fully paid, and nonassessable. The
Shares, upon issuance, are, or will be, free and clear of any security
interests, liens, claims, restrictions, adverse claims, or other encumbrances,
other than restrictions upon transfer under federal and state securities laws.

 

3.4 No Violation. The execution, delivery, and performance of this Agreement has
been duly authorized by the Company’s Board of Directors and will not violate
any law or any order of any court or government agency applicable to the
Company, as the case may be, or the Articles of Incorporation or Bylaws of the
Company.

 

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3.5 SEC Reports and Financial Statements.

 

3.5.1 The Company has delivered or made available to each Purchaser accurate and
complete copies (excluding copies of exhibits) of each report, registration
statement, and definitive proxy statement filed by the Company with the United
States Securities and Exchange Commission (“SEC”) since November 26, 2014
(collectively, with all information incorporated by reference therein or deemed
to be incorporated by reference therein, the “SEC Reports”). As of the time it
was filed with the SEC (or, if amended or superseded by a filing prior to the
date of this Agreement, then on the date of such filing): (i) each of the SEC
Reports complied in all material respects with the applicable requirements of
the Securities Act of 1933, as amended (the “1933 Act”), or the Securities
Exchange Act of 1934, as amended (the “1934 Act”); and (ii) none of the SEC
Reports contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.

 

3.5.2 The consolidated financial statements contained in the SEC Reports: (i)
complied as to form in all material respects with the published rules and
regulations of the SEC applicable thereto; (ii) were prepared in accordance with
GAAP applied on a consistent basis throughout the periods covered (except as may
be indicated in the notes to such financial statements and, in the case of
unaudited statements, as permitted by Form 10-Q of the SEC, and except that
unaudited financial statements may not contain footnotes and are subject to
normal and recurring year-end audit adjustments which will not, individually or
in the aggregate, be material in amount); and (iii) fairly present, in all
material respects, the consolidated financial position of the Company and its
consolidated subsidiaries as of the respective dates thereof and the
consolidated results of operations of the Company and its consolidated
subsidiaries for the periods covered thereby. All adjustments considered
necessary for a fair presentation of the financial statements have been
included.

 

3.6 Securities Law Compliance. Assuming the accuracy of the representations and
warranties of Purchaser set forth in Section 4 of this Agreement, the offer,
issue, sale and delivery of the Shares will constitute an exempted transaction
under the 1933 Act, and registration of the Shares under the 1933 Act is not
required. The Company shall make such filings as may be necessary to comply with
the Federal securities laws, which filings will be made in a timely manner.

 

4. REPRESENTATIONS AND WARRANTIES OF PURCHASER.

 

Purchaser hereby represents, warrants, and covenants with the Company as
follows:

 

4.1 Legal Power. Purchaser has the requisite individual, corporate, partnership,
limited liability company, trust, or fiduciary power, as appropriate, and is
authorized, if such Purchaser is a corporation, partnership, limited liability
company, or trust, to enter into this Agreement, to purchase the Shares
hereunder, and to carry out and perform its obligations under the terms of this
Agreement.

 

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4.2 Due Execution. This Agreement has been duly authorized, if such Purchaser is
a corporation, partnership, limited liability company, trust or fiduciary,
executed and delivered by such Purchaser, and, upon due execution and delivery
by the Company, this Agreement will be a valid and binding agreement of
Purchaser.

 

4.3 Access to Information. Purchaser represents that such Purchaser has been
given full and complete access to the Company for the purpose of obtaining such
information as such Purchaser or its qualified representative has reasonably
requested in connection with the decision to purchase the Shares. Purchaser
represents that it has received and reviewed copies of the SEC Reports.
Purchaser represents that it has been afforded the opportunity to ask questions
of the officers of the Company regarding its business prospects and the Shares,
all as Purchaser or Purchaser’s qualified representative have found necessary to
make an informed investment decision to purchase the Shares.

 

4.4 No Material Non-Public Information. Purchaser represents and warrants that
he is not aware of any material, non-public information about the Company.

 

4.5 Restricted Securities.

 

4.5.1 Purchaser has been advised that the Shares have not been registered under
the 1933 Act or any other applicable securities laws and that Shares are being
offered and sold pursuant to Section 4(2) of the 1933 Act and/or Rule 506 of
Regulation D thereunder, and that the Company’s reliance upon Section 4(2)
and/or Rule 506 of Regulation D is predicated in part on Purchaser
representations as contained herein. Purchaser acknowledges that the Shares will
be issued as “restricted securities” as defined by Rule 144 promulgated under
the 1933 Act (“Rule 144”). The Shares may not be resold in the absence of an
effective registration thereof under the 1933 Act and applicable state
securities laws unless, in the opinion of the Company’s counsel, an applicable
exemption from registration is available.

 

4.5.2 Purchaser represents that it is acquiring the Shares for Purchaser’s own
account, and not as nominee or agent, for investment purposes only and not with
a view to, or for sale in connection with, a distribution, as that term is used
in Section 2(11) of the 1933 Act, in a manner which would require registration
under the 1933 Act or any state securities laws.

 

4.5.3 Purchaser understands and acknowledges that the Shares, when issued, may
bear the following legend:

 

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED
FOR VALUE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION THEREOF UNDER THE
SECURITIES ACT OF 1933 AND/OR THE SECURITIES ACT OF ANY STATE HAVING
JURISDICTION OR AN OPINION OF COUNSEL ACCEPTABLE TO THE CORPORATION THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR ACTS.

 

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4.5.4 Purchaser acknowledges that an investment in the Shares is not liquid and
the Shares are transferable only under limited conditions. Purchaser
acknowledges that such securities must be held indefinitely unless they are
subsequently registered under the 1933 Act or an exemption from such
registration is available. Purchaser is aware of the provisions of Rule 144,
which permits limited resale of restricted securities subject to the
satisfaction of certain conditions and that such Rule is not now available and,
in the future, may not become available for resale of the Shares.

 

4.5.5 Purchaser is an “accredited investor” as defined under Rule 501 under the
1933 Act. The representations made by Purchaser on the Purchaser Signature Page
are true and correct.

 

4.6 Purchaser Sophistication and Ability to Bear Risk of Loss. Purchaser
acknowledges that it is able to protect its interests in connection with the
acquisition of the Shares and can bear the economic risk of investment in such
securities without producing a material adverse change in such Purchaser’s
financial condition. Purchaser, either alone or with such Purchaser’s
representative(s), otherwise has such knowledge and experience in financial or
business matters that such Purchaser is capable of evaluating the merits and
risks of the investment in the Shares.

 

4.7 Preexisting Relationship. Purchaser has a preexisting personal or business
relationship with the Company, one or more of its officers, directors, or
controlling persons.

 

4.8 Purchases by Groups. Purchaser represents, warrants and covenants that it is
not acquiring the Shares as part of a group within the meaning of Section
13(d)(3) of the 1934 Act.

 

5. COVENANTS OF THE COMPANY.

 

5.1 Public Filings; Rule 144. With a view to making available to the Purchaser
the benefits of Rule 144 and any other rule or regulation of the SEC that may at
any time permit the Purchaser to sell the Shares to the public without
registration, the Company will take all further action as Purchaser may
reasonably request, all to the extent required from time to time to enable
Purchaser to sell the Shares of held by it without registration under the 1933
Act within the limitation of the exemption from registration provided by Rule
144. In furtherance thereof, the Company shall do all of the following:

 

5.1.1 make and keep public information available, as those terms are understood
and defined in Rule 144;

 

5.1.2 take such action, including compliance with the reporting requirements of
section 13 or 15(d) of the 1934 Act, as is necessary to enable the Investor to
utilize Rule 144;

 

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5.1.3 file with the SEC in a timely manner all reports and other documents
required of the Company under the 1933 Act, the 1934 Act, and the rules and
regulations adopted by the SEC thereunder; and

 

5.1.4 furnish to the Purchaser forthwith upon written request:

 

(1) a written statement by the Company as to its compliance with the reporting
requirements of Rule 144, the 1933 Act and the 1934 Act (at any time after it
has become subject to such reporting requirements);

 

(2) a copy of the most recent annual or quarterly report of the Company and such
other reports and documents so filed by the Company;

 

(3) an opinion of the Company’s counsel that the Shares may be resold in the
absence of an effective registration thereof under the 1933 Act pursuant to Rule
144; and

 

(4) such other documents as may be reasonably requested in availing the Investor
of any rule or regulation of the SEC that permits the selling of the Shares
without registration.

 

6. MISCELLANEOUS.

 

6.1 Indemnification. Purchaser agrees to defend, indemnify, and hold the Company
harmless against any liability, costs or expenses arising as a result of any
dissemination of the Shares by such Purchaser in violation of the 1933 Act or
applicable state securities law.

 

6.2 Governing Law. This Agreement shall be governed by and construed under the
laws of the State of California.

 

6.3 Successors and Assigns. Except as otherwise expressly provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors, and administrators of the parties hereto.

 

6.4 Entire Agreement. This Agreement and the other documents delivered pursuant
hereto and thereto, constitute the full and entire understanding and agreement
among the parties with regard to the subjects hereof and no party shall be
liable or bound to any other party in any manner by any representations,
warranties, covenants, or agreements except as specifically set forth herein or
therein. Nothing in this Agreement, express or implied, is intended to confer
upon any party, other than the parties hereto and their respective successors
and assigns, any rights, remedies, obligations, or liabilities under or by
reason of this Agreement, except as expressly provided herein.

 

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6.5 Severability. In case any provision of this Agreement shall be invalid,
illegal, or unenforceable, it shall to the extent practicable, be modified so as
to make it valid, legal and enforceable and to retain as nearly as practicable
the intent of the parties, and the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.

 

6.6 Amendment and Waiver. Except as otherwise provided herein, any term of this
Agreement may be amended, and the observance of any term of this Agreement may
be waived (either generally or in a particular instance, either retroactively or
prospectively, and either for a specified period of time or indefinitely), with
the written consent of the Company and the Purchasers, or, to the extent such
amendment affects only one Purchaser, by the Company and such Purchaser. Any
amendment or waiver effected in accordance with this Section shall be binding
upon each future holder of any security purchased under this Agreement
(including securities into which such securities have been converted) and the
Company.

 

6.7 Notices. All notices and other communications required or permitted
hereunder or the Shares shall be in writing and shall be effective when
delivered personally, or sent by telex or telecopier (with receipt confirmed),
provided that a copy is mailed by registered mail, return receipt requested, or
when received by the addressee, if sent by Express Mail, Federal Express or
other express delivery service (receipt requested) in each case to the
appropriate address set forth below:

 

If to the Company: XFit Brands, Inc.   18 Goodyear, Suite 125   Irvine,
California 92618   Attention: Chief Executive Officer     If to the Purchaser:
At the address set forth on the Purchaser’s Signature Page

 

6.8 Faxes, PDFs, and Counterparts. This Agreement may be executed in one or more
counterparts. Delivery of an executed counterpart of the Agreement or any
exhibit attached hereto by facsimile transmission or in portable document format
(“PDF”) shall be equally as effective as delivery of an executed hard copy of
the same. Any party delivering an executed counterpart of this Agreement or any
exhibit attached hereto by facsimile transmission or in PDF shall also deliver
an executed hard copy of the same, but the failure by such party to deliver such
executed hard copy shall not affect the validity, enforceability or binding
nature effect of this Agreement or such exhibit.

 

6.9 Titles and Subtitles. The titles of the paragraphs and subparagraphs of this
Agreement are for convenience of reference only and are not to be considered in
construing this Agreement.

 

[Remainder of page intentionally left blank.]

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth on the Purchase Signature Page hereto.

 

  PURCHASER       (By Counterpart Form - SP Pages)       COMPANY       XFIT
BRANDS, INC.       By: /s/ David E. Vautrin     David E. Vautrin     Chief
Executive Officer

 

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PURCHASER SIGNATURE PAGE

 

The undersigned Purchaser has read Stock Purchase Agreement dated as of June 26,
2015 and acknowledges that execution of this Purchaser Signature Page shall
constitute the undersigned’s execution of such agreement.

 

I hereby subscribe for an aggregate of 40,000 Shares and hereby deliver good
funds with respect to this subscription for the Shares.

 

I am a resident of Xiamen, twian, China 361022

 

Li Mao Please print above the exact name(s) in which the Shares are to be held

  

My address is: Li Mao   46 W. Apricot Forest Rd.,   Building D   Xiamen, Fujian,
China 361021

 

Executed this 26th day of June 2015 at Xiamen, Twian, China.

 

SP-1

 

 

INDIVIDUAL

 

        Name       /s/ Li Mao     Signature (Individual)   Street address      
    Address to Which Correspondence Should be Directed

 

/s/ Li Mao     Signature (All record holders should sign)   City, State and Zip
Code

 

      Name(s) Typed or Printed   Tax Identification or Social Security Number  
        (           )     Telephone Number

 

      Name(s) Typed or Printed (All recorded holders should sign)    

 

SP-2

 

 

CORPORATION, PARTNERSHIP, TRUST ENTITY OR OTHER

 

  Address to Which Correspondence Should be Directed: Name of Entity  

 

  Type of Entity (i.e., corporation, partnership, etc.)   Street Address

 

By:     *Signature   Tax Identification or Social Security Number

 

    Jurisdiction of Formation of Entity   City, State and Zip Code

 

    Name Typed or Printed    

 

Its:   Title   Telephone Number; Fax Number

 

*If Shares are being subscribed for by an entity, the Certificate of Signatory
must also be completed.

 

SP-3

 

 

CERTIFICATE OF SIGNATORY

 

To be completed if the Shares are being subscribed for by an entity.

 

I, Li Mao, am the Secretary of YaYu (the “Entity”).

 

I certify that I am empowered and duly authorized by the Entity to execute and
carry out the terms of the Stock Purchase Agreement and to purchase and hold the
Shares. The Stock Purchase Agreement has been duly and validly executed on
behalf of the Entity and constitutes a legal and binding obligation of the
Entity.

 

IN WITNESS WHEREOF, I have hereto set my hand this 26th day of June, 2015.

 

  /s/ Li Mao   Signature

 

SP-4

 

 

ACCEPTANCE       AGREED AND ACCEPTED:       XFIT BRANDS, INC.       By: /s/
David E. Vautrin     David E. Vautrin     Chief Executive Officer       Date:
June 26, 2015  

 

SP-5

 

 

EXHIBIT A

 

LIwST OF FITNESS AND COMBAT SPORTS EQUIPMENT

 

Training Cages

 

Boxing Rings

 

Bag Racks

 

Training and Fitness Frames and Accessories (Including but not limited to UTC,
CTC, XTC etc.)