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EXHIBIT 10.1
 
ASSET PURCHASE AGREEMENT WITH U-SWIRL YOGURT, INC.
DATED SEPTEMBER 19, 2008

 
 
 

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ASSET PURCHASE AGREEMENT

 
THIS ASSET PURCHASE AGREEMENT (“Agreement”) is made and entered into as of the
19th day of September, 2008, by and among U-SWIRL YOGURT, INC., a Nevada
corporation (“Seller”); HEALTHY FAST FOOD, INC., a Nevada corporation (“HFF”);
and U-SWIRL INTERNATIONAL, INC., a Nevada corporation (“USI”).  HFF and USI may
be collectively referred to below as (“Buyer”).
 
RECITALS
 
A.           Seller currently operates that certain frozen yogurt business known
as U-Swirl Yogurt (the “Business”), which business operates a frozen yogurt
store located at 790 Coronado Center Drive, Henderson, Nevada 89052 (the
“Existing Outlet”).
 
B.           Among other assets, Seller owns certain intangible assets relating
to the Business, as described below in this Agreement (the “System”).
 
C.           USI is a newly-formed entity and a wholly owned subsidiary of HFF.
 
D.           Seller desires to sell the System to Buyer, and Buyer desires to
purchase the System, in accordance with the terms of this Agreement.  Seller
understands that Buyer intends that the System will immediately upon Closing (as
defined below) be owned solely by USI.
 
ARTICLE 1.
 
AGREEMENT TO SELL
 
1.1.           Purchased Assets.  Seller agrees to sell and, at the Closing,
will transfer and deliver to USI all of the following assets owned by Seller and
related to the Business (the “Purchased Assets”), which assets constitute the
System; including but not limited to, the following:
 
(a)           All names, trade names, trademarks, service marks, and commercial
symbols used by Seller in the operation of the Business and the System (the
“Marks”), which are set forth on the Schedule of Marks, attached to this
Agreement as Exhibit A and incorporated herein by this reference.
 
(b)           The current “trade dress,” including the store layout, of the
Existing Outlet (collectively, the “Trade Dress”).
 
(c)           All internet domain names associated with the Business and the
System (the “Domain Names”), which are set forth on the Schedule of Domain
Names, attached to this Agreement as Exhibit B and incorporated herein by this
reference.
 
(d)           All works subject to copyright used in, or related to, the
Business and the System; including, but not limited to, the content on any
website owned by Seller that is subject to a copyright of Seller.
 
(e)           All right, title and interest of Seller in or under all contracts,
agreements, instruments, certificates, permits and licenses that relate to the
Business and that are being assigned to USI, as set forth on the Schedule of
Con­tracts attached to this Agreement as Exhibit C and incorporated herein by
this reference (collectively the “Contracts”).
 
 
 
 

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(f)           All goodwill in the Business and the System, all methods of
operation of the Business and the System, and all other intangible property and
intangible property rights of whatever kind or nature related to the Business
and the System.
 
1.2.           Encumbrances.  All of the Purchased Assets will be sold,
conveyed, transferred, and assigned by Seller to Buyer at the Closing free and
clear of all liens and encumbrances.
 
1.3           No Assumption of Liability.  Buyer will not assume any liabilities
of Seller, the Business, or the System of any kind; including, but not limited
to, any of Seller’s contracts with vendors, suppliers or servicemen (except for
liabilities arising after the Closing Date, as defined below, in the case of
contracts Seller assigns to USI), or Seller’s employees’ salaries, taxes,
benefits, or other expenses.
 
ARTICLE 2.
 
PURCHASE AND PURCHASE PRICE

2.1.           Agreement of Purchase.  Buyer purchases, upon the terms and
subject to the conditions of this Agreement, the Purchased Assets as described
in Article 1 above, and will pay to Seller the Purchase Price, as defined below,
in the manner and upon the terms set forth below.

2.2.           Purchase Price.  The total consideration (the “Purchase Price”)
to be paid by Buyer to Seller is 100,000 restricted shares of HFF common stock
(the “HFF Shares”). The Purchase Price shall be allocated among the Purchased
Assets as follows:

Intellectual Property                                 100,000  shares

TOTAL:                                                      100,000 shares

The allocation above may be adjusted by agreement of the parties at, or after,
Closing.

2.3.           Payment of Purchase Price.  Buyer shall pay the Purchase Price at
Closing by delivering to Seller at Closing a certificate for the HFF Shares
registered in the new name of Seller (as provided for in Section 6.1 below).

ARTICLE 3.

DUE DILIGENCE
 
3.1           Due Diligence of Buyer.   Buyer acknowledges that it has had
sufficient time to review the documents of Seller as it deemed appropriate, and
to inspect and review all of the Purchased Assets.  Buyer accepts the Purchased
Assets.
 
ARTICLE 4.

SELLER’S REPRESENTATIONS, WARRANTIES AND COVENANTS

4.1.           Representations, Warranties and Covenants of Seller.  Seller
represents, warrants, and covenants to Buyer that the state­ments contained in
this Article 4 are correct and complete as of the date of this Agreement, will
be performed and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substi­tuted for the date of this
Agreement throughout this Article 4).
 

 
 
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(a)           Organization of Seller.  Seller is a corpora­tion duly organized,
validly existing, and in good standing under the laws of the jurisdiction of its
incorpora­tion.
 
(b)           Authorization of Transaction.  The directors of Seller have duly
recommended to the shareholders of Seller this transaction and the material
terms of this Agreement, and the shareholders have duly approved this
transaction and the material terms of this Agreement.  Seller has full power and
authority to execute and deliver this Agree­ment and to perform its obligations
hereunder.  The execution and delivery of this Agreement and performance of
Seller’s obligations requires no further action or approval to constitute this
Agreement as a binding and enforceable obligation of Seller.
 
(c)           Marketable Title.  Seller has good and marketable fee simple title
to the Purchased Assets.
 
(d)           Rights in Intellectual Property.  Seller is the exclusive owner of
the Marks, the Domain Names, the Trade Dress, the content on websites associated
with any of the Domain Names, and the other intellectual property being
transferred to Buyer under the terms of this Agreement (collectively, the
“Intellectual Property”).  Seller is not aware of any pending or threatened
claims against Seller asserting rights in any of the Intellectual Property or
asserting trademark infringement, copyright infringement, or patent
infringement.
 
(e)           Scope of Intellectual Property.  The marks listed in Exhibit A to
this Agreement constitute all the registered and unregistered marks owned by
Seller that include the name “U-Swirl” or its variations, and all other marks
that are being used, or have been used in the past, in connection with the
Business or the System.  The domain names listed in Exhibit B to this Agreement
constitute all the domain names owned by Seller that include the name “U-Swirl”
or its variations or that are being used, or have been used in the past, in
connection with the Business or the System.  If any other registered or
unregistered marks or any other domain names were used by Seller in connection
with the Business or the System, Seller transfers those marks and/or domain
names to Buyer.  Seller has no patents registered or pending, or licensed to
Seller by a third party, that relate in any way to the Business or the System.
 
(f)           Encumbrances.  At the time of Closing, the Purchased Assets will
be free of any liens, encumbrances, or other restrictions.
 
(g)           Possession; Transfer.  Seller has the exclusive right of
possession of the Purchased Assets, and no restrictions on transfer of the
Purchased Assets exist.
 
(h)           Third Party Rights.  No person or entity, except as set forth in
this Agreement, has any rights in or to acquire the Purchased Assets or any part
of them.
 
(i)           Taxes.  Seller has paid, or by the Closing will have paid, all
taxes of any kind or nature on or related to the Purchased Assets.
 
(j)           Litigation.  There are no ac­tions, suits, or proceedings that
have been instituted or, to Seller’s knowledge, threatened against or affecting
the Purchased Assets, at law or in equity, or before any federal, state, or
municipal govern­mental commis­sion, board, bureau, agency, or instrumentali­ty
that will materially adversely affect the value or use of the Purchased Assets.
 
(k)            Compliance With Law.  Seller has received no notice of any
violation of any law, regulation, or other governmental requirement affecting
the Purchased Assets.  Seller has no reason to believe that any governmental
authority contemplates issuing any notices, or that any violation exists.
 

 
 
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(l)            Noncontravention.  Neither the execution and delivery of this
Agreement, nor the consummation of the transaction contemplated by it will: (i)
violate any statute, regulation, rule, judgment, order, decree, stipula­tion,
injunction, charge, or other restriction of any government, governmental agency,
or court to which Seller is subject, or any provision of its charter; or (ii)
conflict with, result in a breach of, constitute a default under, result in the
acceleration of, create in any party the right to accelerate, terminate, modify,
or cancel, or require any notice under any contract, license, subli­cense,
agreement or other arrangement to which Seller is a party or by which it is
bound or to which any of the Purchased Assets is subject.  Seller does not need
to give any notice to, or make any filing with, or obtain any authoriza­tion,
consent, or approval of any government or governmental agency for the parties to
consummate the transac­tion contemplated by this Agreement.

(m)           Investment in HFF Shares.  Seller: (i) understands that the HFF
Shares have not been, and will not be, registered under the Securities Act of
1933, or under any state securities laws, and are being offered and sold in
reliance upon federal and state exemptions for transactions not involving any
public offering, (ii) is acquiring the HFF Shares solely for its own account for
investment purposes, and not with a view to the distribution thereof (except to
the shareholders of Seller, if so desired by Seller), (iii) is a sophisticated
investor with knowledge and experience in business and financial matters, (iv)
has received certain information concerning Buyer and has had the opportunity to
obtain additional information as desired in order to evaluate the merits and the
risks inherent in holding the HFF Shares, and (v) is able to bear the economic
risk and lack of liquidity inherent in holding the HFF Shares.

If any of the warranties above are not substantially true at the Closing, Buyer
may cancel this Agreement at the Closing, whereupon neither party will have
further obligation or any liability.
 
ARTICLE 5.

BUYER’S REPRESENTATIONS, WARRANTIES AND COVENANTS
 
5.1.           Representations, Warranties and Covenants of Buyer.  Buyer
represents, warrants, and covenants to Seller that the statements contained in
this Article 5 are correct and complete as of the date of this Agreement, will
be performed, and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substi­tuted for the date of this
Agreement throughout this Article 5).
 
(a)           Organization of Buyer.  HFF and USI are each a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdic­tion of its incorporation.
 
(b)           Authorization of Transaction.  Buyer has full power and authority
to execute and deliver this Agree­ment and to perform its obligations
hereunder.  This Agreement consti­tutes the valid and legally binding obligation
of Buyer, enforceable in accordance with its terms and conditions.
 
(c)           Noncontravention.  Neither the execution and delivery of this
Agreement, nor the consummation of the transaction contemplated by it will: (i)
violate any statute, regulation, rule, judgment, order, decree, stipula­tion,
injunction, charge, or other restriction of any government, governmental agency,
or court to which Buyer is subject, or any provision of HFF’s or USI’s charter;
or (ii) conflict with, result in a breach of, constitute a default under, result
in the acceleration of, create in any party the right to accelerate, terminate,
modify or cancel, or require any notice under any contract, license,
subli­cense, franchise, agreement or other arrangement to which Buyer is a party
or by which it is bound that could have any adverse effect on Seller.  Buyer
does not need to give any notice to, or make any filing with, or obtain any
authoriza­tion, consent, or approval of any government or governmental agency
for the parties to consummate the transaction contemplated by this Agreement.
 

 
 
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ARTICLE 6.

CONTINUED OPERATION AND EXPANSION OF SELLER’S BUSINESS
 
6.1.           Entity Name Change.  On the Closing Date, Seller agrees to file
with the Nevada Secretary of State the proper document(s) to change Seller’s
entity name from U-Swirl Yogurt, Inc. to a name that does not contain the name
“U-Swirl,” “U Swirl,” “Swirl,” or any similar name. Seller will advise Buyer of
that new entity name prior to or at Closing.  Seller will not thereafter change
its entity name back to U-Swirl Yogurt, Inc. or to any name that contains the
name “U-Swirl,” “U Swirl,” “Swirl,” or any similar name.  References to Seller
in this Agreement are to Seller as it is renamed after the name is changed.

6.2.           Continued Operation of Existing Outlet.
 
(a)           License Agreement.  At Closing, Seller and USI shall enter into a
license agreement, in the form of agreement attached to this Agreement as
Exhibit D, and incorporated herein by this reference (the “License Agreement”),
authorizing Seller to use the Marks and the System in the continued operation of
the Existing Outlet.
 
(b)           Franchise Agreement.  At the time that USI is ready to begin
offering franchises to third parties, Seller agrees to execute a franchise
agreement in the then-current form of franchise agreement being offered, or to
be offered, to third parties, which franchise agreement will supersede the
License Agreement; except that the terms of the franchise agreement will be
modified as follows: (i) Seller will not be required to pay an initial franchise
fee or royalties to USI, (ii) Seller’s advertising fund fees will be waived for
at least the first six months after the franchise agreement becomes effective,
(iii) USI will not provide the initial training program or any other pre-opening
training to Seller; and (iv) USI will not be obligated to provide store opening
assistance or any on-going training or assistance  to Seller, although USI may,
at its sole option, elect to do so.

6.3.           Establishment of Additional Outlets.
 
(a)           Approval of Requests for Expansion.  Seller may at any time and
from time to time request approval from USI to establish and operate additional
Business outlets (besides the Existing Outlet) operating under the Marks in the
following cities in Nevada:  Henderson, Boulder City, and Pahrump (collectively,
the “Territory”).  USI will not unreasonably withhold its approval; provided,
however, that Seller must be in full compliance with this Agreement, and all
license agreements, franchise agreements, and other agreements between Seller
and Buyer.
 
(b)           Conditions of Expansion.  Seller may establish and operate one or
more additional Business outlets in the Territory only if USI has given its
approval, as specified above, and Seller complies with all of the following
conditions for each new Business outlet:
 
(1)           Seller must provide USI with information about the proposed site
for the Business outlet as requested by USI, and Seller must receive approval
for the site from USI (which approval will not be unreasonably withheld).
 
(2)           Seller must, at USI’s sole determination, execute either: (a) a
license agreement similar to the License Agreement (in which case the site
approval condition above is waived); or (b) a franchise agreement in the
then-current form of franchise agreement being offered, or to be offered, to
third parties by USI at that time; except that the terms of the franchise
agreement will be modified as follows:  (i) The initial franchise fee will be
$5,000.00; (ii) the royalty fee will be 1% of gross sales (or of whatever term
is used in the then-current form of franchise agreement as the basis for the
royalty fee); (iii) USI will not
 
 
 
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provide the initial training program or any other pre-opening training to
Seller; and (iv) USI will not be obligated to provide store opening assistance
or any on-going training or assistance  to Seller, although USI may, at its sole
option, elect to do so.  Seller’s requirement to pay advertising fund fees will
be the same as in the then-current form of franchise agreement.

ARTICLE 7.

TRAINING FACILITY

7.1.           Existing Outlet as Training Facility.  Beginning on the Closing
Date, and continuing for as long as Seller operates the Existing Outlet, or
until such earlier date on which USI no longer needs use of the facility, Seller
will permit USI to use the Existing Outlet as a training facility.  During this
time, USI may place its employees, prospective franchisees or their employees,
and/or other persons in the Existing Outlet for the purposes of providing
training to those people in the operation of a U-Swirl Frozen Yogurt business.

7.2           No Additional Compensation.
 
(a)           Regardless of the extent of USI’s use of the Existing Outlet as a
training facility, neither USI nor HFF is obligated to pay any compensation or
remuneration of any kind to Seller for the use of the Existing Outlet for this
purpose.
 
(b)           Subject to modification if required by applicable law, Seller is
not obligated to pay any compensation to any person placed into the Existing
Outlet by USI for training; and if any compensation is required to be paid to
any such person, USI will be responsible for paying that compensation.
 
ARTICLE 8.
 
CONDITIONS TO CLOSE
 
8.1.           Conditions to Obligations of Buyer.  The obligation of Buyer to
consummate the transaction to be performed by it in connection with the Closing
is subject to satisfaction of all of the following conditions:
 
(a)           Representations and Warranties.  The represen­ta­tions and
warranties set forth in Article 4 above are true and correct in all material
respects at and as of the Closing Date.
 
(b)           No Litigation.  No material action, suit, or proceed­ing is
pending or threatened before any court or quasi-judicial or adminis­tra­tive
body, in any federal, state, local, or foreign jurisdic­tion, nor is any
unfavorable judgment, order, decree, stipula­tion, injunction, or charge pending
or threatened that would (i) prevent consum­mation of the transac­tion
contemplated by this Agreement, or (ii) cause the transaction contemplated by
this Agreement to be rescinded following consummation; and no such judgment,
order, decree, stipulation, injunction, or charge is in effect.
 
(c)            Form of Documents.  All actions to be taken by Seller in
connection with the consummation of the transaction contemplated by this
Agreement and all certificates, opinions, instru­ments, and other documents
required to effect the transaction contemplated by this Agreement are
satisfactory in form and sub­stance to Buyer and its counsel.
 
Buyer may, at its sole election, waive any conditions specified in this Section
if it executes a writing so stating at or prior to the Closing, or if it
proceeds with the Closing.
 
 
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8.2.           Conditions to Obligations of Seller.  The obligation of Seller to
consummate the transaction to be performed by it in connection with the Closing
is subject to satisfaction of all of the following conditions:
 
(a)           Representations and Warranties.  The represen­ta­tions and
warranties set forth in Article 5 above are true and correct in all material
respects at and as of the Closing Date.
 
(b)           No Litigation.  No material action, suit, or proceed­ing is
pending or threatened before any court or quasi-judicial or adminis­tra­tive
body, in any federal, state, local, or foreign jurisdic­tion, nor is any
unfavorable judgment, order, decree, stipula­tion, injunction, or charge pending
or threatened that would (i) prevent consum­mation of the transac­tion
contemplated by this Agreement, or (ii) cause the transaction contemplated by
this Agreement to be rescinded following consummation; and no such judgment,
order, decree, stipulation, injunction, or charge is in effect.
 
(c)           Form of Documents Satisfactory.  All actions to be taken by Buyer
in connection with the consumma­tion of the transaction contemplated by this
Agreement and all certificates, opinions, instru­ments and other documents
required to effect the transaction contemplated by this Agreement are
satisfactory in form and substance to Seller and its counsel.
 
Seller may, at its sole discretion, waive any conditions specified in this
Section if it executes a writing so stating at or prior to the Closing, or if it
proceeds with the Closing.

ARTICLE 9.

CLOSING

 
9.1.           The Closing.  The closing of the transaction contem­plated by
this Agreement (the “Closing”) will take place at the offices of Buyer,
commencing at ______ a.m., local time, on September ___, 2008, or such other
business day and/or time as agreed to by the parties  (the “Closing Date”).

9.2.           Deliveries at the Closing.  At the Closing, the parties will
deliver all of the following:

 
(a)
Seller shall deliver to Buyer all of the following documents:

(i)           Assignments for the Con­tracts and Domain Names properly executed
and acknowledged, in such form as USI reasonably re­quests.

(ii)           A copy of a resolution or consent minutes of Seller’s Board of
Directors and shareholders authorizing and approving this transaction.

(iii)           The License Agreement, signed on behalf of Seller.

(iv)           Such other instruments of sale, trans­fer, convey­ance, and
assignment as Buyer reason­ably may request.

(b)           Buyer shall deliver to Seller all of the following documents:

(i)           A stock certificate of HFF representing the Purchase Price,
registered in the new name of Seller.
 
(ii)           The License Agreement, signed on behalf of USI.
 

 
 
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(iii)           Such other instruments of sale, trans­fer, convey­ance, and
assignment as Seller reason­ably may request.

9.3           Prorations. Personal property ad valorem taxes related to the
Purchased Assets and prepaid fees under any contracts being assigned, if any,
and all other customary closing costs incurred, if any, shall be prorated to the
Closing Date based upon actual days involved.  If those charges are unavailable
at the Closing Date, a readjustment of these items will be made within 30 days
after the Closing.  The proration of personal property taxes will be based upon
the most recent assessed value of the applicable portion of the Purchased Assets
and the most recent mill levy figures as available from the County Assessor’s
office for the county where the Purchased Assets are located and will be a final
proration.  All special taxes, charges, and assessments affecting the Purchased
Assets payable in installments, if any, will be prorated between Buyer and
Seller based upon the period covered by the installment.

9.4       Possession.  Possession by USI of the Purchased Assets will occur on
the Closing Date at Closing.

ARTICLE 10.

INDEMNIFICATION

10.1                      Indemnification by Seller.  Seller agrees to indemnify
and hold HFF and USI, and their respective directors, officers, employees,
agents, representatives, successors, and assigns (collectively, including HFF
and USI, the “Buyer’s Group Members”) harmless from and against any and all
claims, demands, losses and expenses incurred by any Buyer’s Group Member in
connection with or arising from failure or default of any of the covenants,
agreements, representations, or warranties of Seller under this Agreement, all
known debts of Seller as of the Closing Date, and any and all amounts that might
be claimed, asserted, or established for as deficiencies in or with respect to
federal or state income taxes, or franchise and other taxes and charges against
Seller; and all such deficiencies with respect to operations and business of
Seller and the Existing Outlet during the current fiscal year up to the Closing
Date.  If any claim is asserted for which Seller will be obligated to indemnify
the Buyer’s Group Members pursuant to this provision, Seller shall, within 10
days after receiving written notice of such claim, notify the Buyer’s Group
Members in writing whether Seller does or does not have any objection to the
payment of the claim.  Seller shall not object to the payment of any such claim
unless Seller shall at the same time inform the Buyer’s Group Members in writing
that Seller disputes the claim, in whole or in part, and Seller promptly
initiates proper proceedings to contest the claim and undertake the appropriate
defense thereof at Seller’s sole cost and expense, and in a manner that may be
effective to protect against liability in connection therewith.  If within the
10-day period, Seller has no objection to the payment of the claim, Seller shall
be obligated to pay such claim within 10 days after the expiration of the 10-day
notice period.  The failure of Seller to pay the claim will constitute full
authority to the Buyer’s Group Members to either contest the claim or pay the
claim.  In that event, the Buyer’s Group Members will be entitled to receive
from Seller immediately the amount paid, and Seller will have no right to
contest the validity of the creditor’s claim against Seller or the Buyer’s Group
Members, as the case may be.  In the event Seller, within the above mentioned
10-day period, objects in writing to the payment of the claim, and promptly
initiates proper proceedings to contest the claim and undertake the appropriate
defense thereof, then the Buyer’s Group Members will not have the authority to
pay the claim as herein provided, unless and until the claim in whole or in part
is finally determined to be due and owing.  In that situation, the parties will
be bound by the foregoing provision with respect to payment of claims.  In the
event Seller fails to indemnify and hold the Buyer’s Group Members harmless from
any matter described in this paragraph within a reasonable time, or fails to pay
any obligations of Seller in a timely manner, the Buyer’s Group Members may cure
the default, pay any obligations of Seller, and demand immediate reimbursement
from Seller.
 
 
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 10.2                      Indemnification by Buyer.  Buyer agrees to indemnify
and hold Seller, its directors, officers, employees, agents, representatives,
successors, and assigns (collectively, including Seller, the “Sellers Group
Members”) harmless from and against any and all claims, demands, losses, and
expenses incurred by any Sellers Group Member in connection with or arising from
any breach or failure to perform by Buyer any of its agreements, covenants, or
obligations in this Agreement or any other agreement between the parties; or any
breach of any warranty or the inaccuracy of any representation of Buyer
contained in this Agreement.
 
ARTICLE 11.

MISCELLANEOUS

11.1.                      Survival.  All of the representations, warranties,
and covenants of Buyer and Seller contained in this Agreement, and each party’s
respective indemnification provision, will survive the Closing.  Seller’s
obligations under Article 6 and Article 7 of this Agreement will survive the
Closing.

11.2.                      No Third-Party Beneficiaries.  This Agreement will
not confer any rights or remedies upon any entity or person other than the
parties and their respective successors and permitted assigns.

11.3.                      Entire Agreement.  This Agreement, including the
exhibits and documents referred to in this Agreement, constitutes the entire
agreement between the parties and supersedes any prior understand­ings,
agreements, or representations by or between the parties, written or oral, that
may have related in any way to the subject matter of this Agreement.

11.4.                      Succession and Assignment.  This Agreement will be
binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns.  No party may assign this Agreement or any of
its rights, interest, or obligations hereunder without the prior written
approval of the other party; except that USI may assign its rights and
obligations under Sections 6.2 and 6.3 of this Agreement to a successor entity
without approval of Seller.

11.5.                      Counterparts.  This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.

11.6.                      Headings.  The Section headings contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.

11.7.                      Notices.  All notices, requests, demands, claims or
other communications shall be given in writing.  Any notice, request, demand,
claim or other communica­tion hereunder shall be deemed duly given if it is
personally delivered, or sent by certified mail, return receipt requested,
postage prepaid and addressed to the intended recipient as set forth below:

(a)           If to
Seller:                                                                (b)           If
to Buyer:

Justin
Cartwright                                                                       
Henry Cartwright
U-Swirl Yogurt,
Inc.                                                                  Healthy
Fast Food, Inc. / U-Swirl International, Inc.
1075 American Pacific Suite C                                               1075
American Pacific Suite C
Henderson,
NV  89074                                                             Henderson,
NV  89074

Any party may change the address to which notices are to be delivered by giving
the other party(ies) notice in a manner set forth above.

 
9

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11.8.                      Governing Law.  This Agreement will be governed and
construed in accordance with the laws of the State of Nevada.

11.9.                      Amendments and Waivers.  No amendment of any
provision of this Agreement will be valid unless it is in writing and signed by
the parties.  No waiver by any party of any default, misrepresentation, or
breach of warranty or covenant under this Agreement, whether intentional or not,
will be deemed to extend to any prior or subsequent fault, misrepresentation,
breach of warranty or covenant under this Agreement, or effect in any way any
rights arising by virtue of any prior or subsequent occur­rence.

11.10.                      Severability.  Any term or provision of this
Agreement that is invalid or unenforceable under applicable law will not affect
the validity or enforceability of the remaining terms and provisions of this
Agreement or the validity or enforceability of the offending term or provision
in any other situation or in any other jurisdiction.

11.11.                      Expenses.  Except as specified below, Buyer and
Seller will each bear its own costs and expenses (including legal fees and
expenses) incurred in connection with this Agreement and the transaction
contemplated by this Agreement.

11.12.                      Construction.  The language used in this Agreement
will be deemed to be the language chosen by the parties to express their mutual
intent, and no rule of strict construction will be applied against any party.
The parties intend that each represen­tation, warranty, and covenant contained
in this Agreement will have independent significance.

11.13                      Attorney’s Fees.  If any action is instituted by any
party to interpret or enforce any provisions of this Agreement, the prevailing
party (or parties) is entitled to recover reasonable attorneys’ fees and costs,
in both the trial court and appellate court (if applicable).

11.14.                      Further Assurances.  From time to time after the
execution of this Agreement or the Closing, Seller shall, if reasonably
requested by Buyer, make, execute and deliver to Buyer such additional
assignments, bills of sale, or other instruments of transfer as may be necessary
or proper to transfer to Buyer all of Seller’s right, title, and interest in and
to any of the Purchased Assets.  Buyer shall likewise execute and deliver to
Seller any instruments or documents necessary to carry out the intent and
purposes of this Agreement.

SELLER:     BUYER:              U-SWIRL YOGURT, INC.     HEALTHY FAST FOOD, INC.
           
By:  /s/ Justin Cartwright
   
By:  /s/ Henry Cartwright
 
       Justin Cartwright
   
           Henry Cartwright
 
       President 
   
           President
                  U-SWIRL INTERNATIONAL, INC.                   By:   /s/ Henry
Cartwright                    Henry Cartwright                     President    
       

 

 
 
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EXHIBIT A
 
Schedule of Marks

“u-swirl FROZEN YOGURT and Design,” U. S. Serial Number 77/561907
“U and Design,” U. S. Serial Number 77/561906
“Worth the Weight,” U. S. Serial Number 77/561905

 
 

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EXHIBIT B

Schedule of Domain Names

U-SWIRL.COM
U-SWIRL.NET
U-SWIRLFROZENYOGURT.COM
U-SWIRLFROZENYOGURT.NET
U-SWIRLYOGURT.COM
U-SWIRLYOGURT.NET
USWIRLFROZENYOGURT.COM
USWIRLFROZENYOGURT.NET
USWIRLYOGURT.COM
USWIRLYOGURT.NET

 
 

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EXHIBIT C
 
Schedule of Contracts

Internet Domain Name Registrations Contract with Go Daddy.Com, Inc., paid
through November 28, 2008.

 
 

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EXHIBIT D

License Agreement

 
 

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LICENSE AGREEMENT

 
THIS AGREEMENT (“Agreement”) is made effective as of the ___ day of __________,
20__ (the “Effective Date”), between U-SWIRL INTERNATIONAL, INC., a Nevada
corporation, located at 1075 American Pacific Suite C, Henderson, Nevada  89074
(“USI”); and U-SWIRL YOGURT, INC., to be known as U CREATE ENTERPRISES
INCORPORATED, a Nevada corporation, located at 1075 American Pacific Suite C,
Henderson, Nevada  89074 (“Licensee”).

RECITALS
 
A.           USI and Licensee entered into that certain Asset Purchase
Agreement, dated as of the same date of this Agreement (the “Purchase
Agreement”).
 
B.           Under the terms of the Purchase Agreement, Licensee transferred to
USI all of its ownership in the following service marks (collectively, the
“Marks”):

1.           “u-swirl FROZEN YOGURT and Design,” U. S. Serial Number 77/561907
2.           “U and Design,” U. S. Serial Number 77/561906
3.           “Worth the Weight,” U. S. Serial Number 77/561905
 
C.           The Marks were used by Licensee in connection with the operation of
a U-Swirl Frozen Yogurt business.
 
D.           Under the terms of the Purchase Agreement, Licensee also
transferred to USI all of its ownership in certain other intellectual property
(including “trade dress,” which includes store layout; and copyrighted
materials) used by Licensee in the operation of a U-Swirl Frozen Yogurt
Business, as referred to in the Purchase Agreement (the “Licensed Property”).
 
E.           Under the terms of the Purchase Agreement, USI and Licensee agreed
to enter into an agreement by which Licensee may continue to use the Marks and
Licensed Property in the operation of its existing U-Swirl Frozen Yogurt outlet,
until USI and Licensee enter into a new agreement that will supersede this
Agreement, or until such other date that this Agreement terminates.
 
F.           Licensee understands that USI may (i) add to, delete, or otherwise
modify the Marks and Licensed Property; (ii) create new methods of operation;
(iii) create its own proprietary materials; and/or (iv) otherwise develop the
U-Swirl Frozen Yogurt system by establishing new outlets or otherwise. (The
Licensed Property, methods of operation, proprietary materials and information,
and know-how used in connection with the operation of U-Swirl Frozen Yogurt
outlets, as applicable and as may be modified from time to time, are
collectively referred to below as the “System”).
 
g.           Licensee recognizes the necessity and desirability of protecting
the reputation, goodwill, trade secrets, and confidential business information
of USI and the System; and that disclosure of trade secrets and confidential
business information, including specifics of the System to any third party not
authorized to receive the information, will cause irreparable damage and harm to
USI and the System.

AGREEMENT
 
1.   The License.  USI grants Licensee a non-exclusive license (the “License”)
to use the Marks and the System, as the Marks and the System may be modified
from time to time by USI, on and in
 
 
 

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connection with the operation of Licensee’s U-Swirl Frozen Yogurt outlet (the
“Services”) located at 790 Coronado Center Drive, Henderson, Nevada 89052 (the
“Licensed Location”).

2.   Term of Agreement and License.  The term of this Agreement and the License
will be ten years from the Effective Date, unless sooner superseded by another
agreement between USI and Licensee, or unless terminated as specified below in
this Agreement.

3.   License Fee.  The License Fee is waived.  The consideration for this
Agreement and the License is contained in the Purchase Agreement.

4.   Changes in the Marks.   If USI creates any new service mark(s) or
trademark(s) for use in a U-Swirl Frozen Yogurt outlet, the new mark(s) will
automatically be subject to this Agreement, and considered to be among the Marks
referred to in this Agreement, upon written notification from USI to Licensee
specifying the new mark(s).

5.   Changes in the System. If USI adds to, deletes, or otherwise modifies any
of the Licensed Property or other elements of the System, the Licensed Property
or other elements of the System, as supplemented, decreased, or otherwise
modified will automatically be subject to this Agreement, and considered to be
the Licensed Property and/or System referred to in this Agreement, upon written
notification from USI to Licensee specifying the modification.

6.   Limitations on Use of Marks and the System.

a.   Licensee agrees to use the Marks only in connection with the Services, and
only as specified from time to time by USI.  Licensee further agrees to offer
only goods and services under the Marks that meet the standards and
specifications of quality and otherwise as established by USI from time to time
(the “Standards and Specifications”).  The initial Standards and Specifications
are set forth or described in the attached Rider, and made a part of this
Agreement.  USI may change the Standards and Specifications from time to time,
and Licensee agrees to comply with the new Standards and Specifications within a
reasonable time.

b.   To the extent that the Licensed Property or other elements of the System
affect the quality of goods or services provided by Licensee under the Marks or
the trade dress of Licensee’s U-Swirl Frozen Yogurt outlet:  (i) Licensee agrees
to use the Licensed Property only as it was using the Licensed Property
immediately prior to the effectiveness of the Purchase Agreement, or as
otherwise specified from time to time by USI; and (ii) Licensee agrees to use
the other elements of the System as specified from time to time by USI.

c.   Licensee acknowledges and agrees that it is permitted to use the Marks and
the System only at, or in connection with the operation of, a U-Swirl Frozen
Yogurt outlet at the Licensed Location.

d.   Licensee shall not, directly or indirectly, apply to register, register, or
otherwise seek to control or in any way use (except as expressly permitted by
this Agreement, and recognizing that Licensee previously applied to register the
Marks that have been assigned to USI in the Purchase Agreement) “U-Swirl,”
“U-Swirl Yogurt,” or any other of the Marks, or any confusingly similar form or
variation, in any place or jurisdiction either within or outside the United
States; nor will Licensee assist any third parties to do so.

e.   Licensee agrees: (1) that it will not post any of USI’s confidential
information on the Internet, and (2) that it will not post any USI copyrighted
material or information on the Internet without USI’s prior written permission;
nor shall Licensee assist any third party in doing so.
 

 
 
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7.   Prior Approval of USI Required for Advertising and Promotional
Materials.  Licensee agrees to submit to USI for its approval prior to use all
advertising and other promotional materials that include the Mark, including any
material that is contained in any website owned by Licensee or otherwise is
placed by, or under the direction of, Licensee on the Internet, which approval
will not be unreasonably withheld.

8.   Determination of Quality of Services and Goods; Samples and Access to
Premises.  USI has the sole right to determine whether the Services, and the
goods provided as part of the Services, being offered and/or sold by Licensee
are consistent with the Standards and Specifications.  USI has the right to
require from time to time that Licensee submit samples of the goods sold under
the Marks to USI for testing and/or other methods of evaluation.  Licensee
agrees to provide to USI’s representatives access to its business premises to
inspect the performance of the Services or inspect the goods sold under the
Marks.

9.   Ownership, Rights, and Goodwill.  Licensee acknowledges and agrees that the
Marks and the System, all rights in the Marks and the System, and the goodwill
pertaining to the Marks and the System belong exclusively to USI; and that all
rights resulting from Licensee’s use of the Marks and the System inure to the
benefit of USI.

10.   Third-Party Infringement.  Immediately upon becoming known to Licensee,
Licensee shall notify USI of any infringement of the Marks, any challenge to its
use of any of the Marks, and/or any claim by any person of any rights in any of
the Marks. Licensee agrees that it will not communicate with any person other
than representatives of USI in connection with any such infringement, challenge,
or claim.  USI will have sole option whether to take any action related to any
infringement, challenge, or claim, as it deems appropriate.  USI will have the
right to exclusively control any litigation, or any U. S. Patent and Trademark
Office or other proceeding arising out of any infringement, challenge, or claim,
or otherwise relating to any of the Marks.  Licensee agrees to execute any and
all instruments and documents, render such assistance, and do such acts and
things as may, in the opinion of USI, be necessary or advisable to maintain
USI’s interests in any such litigation or U. S. Patent and Trademark Office or
other proceeding; or to otherwise protect and maintain USI’s interest in the
Marks.

11.   Confidentiality.

a.   Licensee acknowledges that USI may provide to Licensee information that is
confidential information of USI, and that constitutes trade secrets and remains
the sole exclusive property of USI.  Confidential information includes: (1)
information about products, services, or procedures used in the System before
they become public knowledge; and (2) other information disclosed to Licensee
through confidential notifications and/or an operating manual (if a manual is
created by USI).  To the extent that Licensee transferred/transfers to USI, in
connection with the Purchase Agreement or otherwise, any trade secrets or other
confidential information that Licensee used in connection with the operation of
its U-Swirl Frozen Yogurt outlet, Licensee agrees those trade secrets and that
confidential information are trade secrets and confidential information solely
of USI.  Licensee shall not disclose any such information, except as authorized
by USI.  Licensee shall return all materials such as manuals, recipes, menus,
brochures and the like, and other materials received from USI, to USI upon the
termination of this Agreement for any cause (other than it being superseded by a
new agreement concerning its subject matter).  This provision will survive
termination of this Agreement to the extent not superseded by another agreement
between the parties.

b.   If asked to do so by USI, before disclosing confidential information or
trade secrets to its employees or other representatives, Licensee will require
those people to sign confidentiality agreements
 
 
 
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in a form supplied by, or approved by, USI, binding those people not to disclose
the information except as may be authorized in the agreement.  In any case,
Licensee agrees it will take all steps necessary at Licensee’s own expense, to
protect the confidential information and trade secrets mentioned in this
Agreement.

12.   No Sublicenses by Licensee.  Licensee has no right to sublicense the Marks
or the Licensed Property.

13.   Rights Retained by USI.  Licensee acknowledges and agrees that USI retains
the right to use, or to license to any third party the use of, the Marks, the
Licensed Property, and/or the other elements of the System for any and all goods
or services, at any location other the Licensed Location or within the
Territory, as specified in the Purchase Agreement.  Licensee acknowledges and
agrees that USI retains the right to own and/or operate, or to license or
franchise others to own and/or operate, U-Swirl Frozen Yogurt outlets or other
outlets providing goods and/or services similar to those provided by Licensee at
any location other the Licensed Location or within the Territory, as specified
in the Purchase Agreement.

14.   Indemnification by USI.  USI agrees that Licensee will have no liability,
and USI will indemnify, defend, and hold Licensee, and its directors, officers,
employees, agents, and representatives (collectively, the “Licensee Affiliates”)
harmless against any and all damages, liabilities, attorneys’ fees, or costs
incurred by Licensee or the Licensee Affiliates in defending against any
third-party claims or threats of claims under trademark, copyright, or unfair
competition or deceptive trade practices acts arising from Licensee’s use of the
Marks or the System in full compliance with this Agreement.  Licensee and the
Licensee Affiliates may, at their own expense, appear through counsel of their
own choosing to defend themselves against any such action.

15.   Indemnification by Licensee.  Licensee agrees that USI will have no
liability, and Licensee will indemnify, defend, and hold USI, and its directors,
officers, employees, agents, and representatives (collectively, the “USI
Affiliates”), harmless against any and all damages, liabilities, attorneys’ fees
or costs incurred by USI or the USI Affiliates in defending against any
third-party claims or threats of claims arising from the business or products of
Licensee or the Licensee Affiliates, or Licensee’s or the Licensee Affiliates’
use of the Marks or the System other than in full compliance with this
Agreement.  USI and the USI Affiliates may, at their own expense, appear through
counsel of their own choosing to defend themselves in any such action.

16.   Termination of Agreement and License.  Licensee may terminate this
Agreement and the License at any time upon written notice to USI.  This
Agreement and the License may not be terminated by USI unless any of the
following events occur: (a) Licensee ceases to do business; (b) Licensee ceases
to operate a business offering the Services under the Marks and the System; (c)
Licensee breaches any of the terms of this Agreement, provided that Licensee
will have ten days after the receipt of written notice from USI specifying the
breach in which to cure the breach, if the breach is curable; or (d) USI and
Licensee agree to an earlier termination of this Agreement (such as by entering
into a superseding agreement).

17.   Effect of Termination; Obligations of Licensee.  Licensee agrees that if
this Agreement expires or terminates for any reason, except if it is superseded
by a new agreement between Licensee and USI covering its subject matter,
Licensee will do all of the following:
 
a.           Immediately cease using the Marks and the Licensed Property,
including a complete de-identification of Licensee’s U-Swirl Frozen Yogurt
outlet as a U-Swirl Frozen Yogurt outlet.

b.           Immediately return to USI all material containing any Marks or
Licensed Property.

 
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c.           Promptly cease using all Listings (as defined below), and if
instructed by USI to do so, promptly execute all forms and documents required by
USI and any service provider at any time to transfer the service and any related
Listings to USI; and refrain from entering any “call forwarding” or similar
instruction with a service provider that has the effect of circumventing the
unconditional obligation of Licensee to surrender and cease using all
Listings.  For purposes of this Agreement, “Listings” means Licensee’s telephone
or facsimile numbers and Yellow Pages listings/advertisements or other business
listings or directories, including any website, domain name, or other Internet
usage.  Upon termination of this Agreement and the License, USI will have the
immediate right to the Listings and to have the service transferred to
USI.  Licensee appoints USI its true and lawful agent and attorney-in-fact with
full power and authority for the sole purpose of taking such action as is
necessary to complete this assignment.  Licensee shall not thereafter use the
Listings at or in connection with any subsequent business owned or operated by
Licensee, its officers, directors, shareholders, employees, or representatives,
or for any other purpose.  The obligations of Licensee in this provision are
also obligations of the Licensee Affiliates.
 
d.           Immediately cease operating a business offering frozen yogurt or
ice cream or similar products at the Licensed Location, and not operate a
business of that type at the Licensed Location or within one mile of any U-Swirl
Frozen Yogurt outlet for a period of two years thereafter.  The prohibitions on
subsequent use of the Marks stated above apply to the use of the words
“formerly,” “former,” “formerly associated,” or any words conveying similar
meaning and used in conjunction with the Marks.  The obligations of Licensee in
this provision are also obligations of the Licensee Affiliates.
 
e.           If a court of competent jurisdiction determines that restrictions
in the preceding paragraph are excessive in time, geographic scope, or
otherwise, the court may reduce the restriction to the level that provides the
maximum restriction allowed by law.
 
f.           The obligations of this Section and this power of attorney referred
to above in this Section will survive the termination of this Agreement.

18.   Assignment.  USI may assign or otherwise transfer this Agreement to any
party that acquires the ownership of, or a license to sublicense, the Marks or
the System.  This Agreement is personal to Licensee, and as such, it is not
assignable by Licensee.

19.   Independent Contractors. The relationship between USI and Licensee is that
of independent contractors.  Licensee is in no way to be deemed a partner, joint
venturer, agent, employee, or servant of USI.  Licensee has no authority to bind
USI to any contractual obligation or incur any liability for or on behalf of
USI.  Licensee shall install a sign at its U-Swirl Frozen Yogurt outlet, at a
location and in a form designated by USI, indicating that Licensee is an
independent contractor and is the owner of the outlet.  Licensee shall identify
itself as an independent owner of the outlet and the business in all dealings
with customers, lessors, contractors, suppliers, public officials, employees,
and others.  Licensee shall put notices of this independent ownership on signs,
forms, stationery, advertising, and other materials as USI may at any time
require.

20.   Illegality; Survival.  If any of the terms, conditions, or provisions of
this Agreement violate or contravene any applicable laws, that/those term(s),
condition(s), or provision(s) will be deemed not a part of this Agreement, and
the remainder of this Agreement will remain in full force and effect.

21.   No Guaranty of Licensee’s Success.  Licensee acknowledges that USI has
made no guarantees or representations concerning the success of Licensee’s
business or the License granted by this Agreement.  Licensee has been informed
and acknowledges its understanding that because of the highly
 
 
 
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competitive nature of the business involved, successful operation of its U-Swirl
Frozen Yogurt business will depend in part, upon the best efforts, capabilities,
management, and efficient operation by Licensee; as well as the general economic
trend and other local marketing conditions.

22.   Notices.  All notices specified by this Agreement or required by law must
be in writing and given by personal delivery or sent by certified mail, return
receipt requested to the address(es) set forth at the beginning of this
Agreement or to such other address(es) as the parties may designate in writing
prior to the giving of any notice.   Notices will be deemed “delivered” when
actually left in the custody of an adult agent or employee if given by personal
delivery; or if given by certified mail, one business day after being deposited
with the U.S. Postal Service with proper address and postage paid.

23.   Interpretation.  All the terms and provisions of this Agreement will be
binding upon and inure to the benefit of the successors and assigns of the
parties.  However, nothing in this paragraph may be construed as consent by USI
to the assignment or transfer of this Agreement or any rights by Licensee.

24.   No Waiver.  Failure of USI to insist upon the strict performance of any
term, covenant, or condition contained in this Agreement will not constitute or
be construed as a waiver or relinquishment of USI’s rights to enforce thereafter
any such term, covenant, or condition; and it will continue in full force and
effect.

25.   Litigation Expense.  If an action at law or suit in equity is brought to
establish, obtain or enforce any right by either of the parties to this
Agreement, the prevailing party in the suit or action, in the trial and/or
appellate courts, will be entitled to reasonable attorneys fees to be recovered
from the other party as well as that party’s costs and disbursements incurred in
such suit or action.

26.   Entire Agreement.  This Agreement, including its Rider, and the Purchase
Agreement contains the entire agreement between the parties relating to its
subject matter, and all prior proposals, discussions or writings (other than the
Purchase Agreement), are superseded.  The terms of this Agreement will be
binding upon and will inure to the benefit of the parties and their permitted
successors, heirs, and assigns (if any).

27.   Applicable Law and Forum.  This Agreement and the License will be
governed, construed, and enforced in accordance with the laws of the state of
Nevada.  The exclusive forum for any disputes arising out of or in connection
with this Agreement and/or the License will be in the federal or state courts
located in Nevada.

28.   Headings.  The Section headings contained in this Agreement are inserted
for convenience only and do not affect in any way the meaning or interpretation
of this Agreement.

29.   Counterparts.  This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original but all of which together will
constitute one and the same instrument.
 
U-SWIRL YOGURT, INC., to be known as
U CREATE ENTERPRISES INCORPORATED
    U-SWIRL INTERNATIONAL, INC.            
By:  /s/ Justin Cartwright
   
By:   /s/  Henry Cartwright 
 
          Justin Cartwright
   
          Henry Cartwright
 
          President
   
          President
 

 
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STANDARDS AND SPECIFICATIONS RIDER
TO LICENSE AGREEMENT

USI establishes the following initial standards and specifications for the
Services offered and sold by Licensee under the foregoing License:

The Services offered and sold by Licensee, and any goods sold by licensee in
connection with the Services, must be of at least the same quality as Licensee
was providing through its business immediately prior to the effectiveness of the
Purchase Agreement.
 
 
 
 
 
 
 

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