Exhibit 10.1
 
 
 
 
STOCK PURCHASE AGREEMENT
 
BETWEEN
 
INNOVATIVE FOOD HOLDINGS, INC.,
 
ARTISAN SPECIALTY FOODS, INC.
 
AND
 
DAVID VOHASKA
 
DATED AS OF MAY 10, 2012
 
 
 
 
 

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STOCK PURCHASE AGREEMENT
 
THIS STOCK PURCHASE AGREEMENT (this “Agreement”), dated as of May 10, 2012, is
between INNOVATIVE FOOD HOLDINGS, INC., a Florida corporation (“IVFH”), ARTISAN
SPECIALTY FOODS, INC., a Delaware corporation (“Purchaser”) and DAVID VOHASKA,
an individual (hereafter referred to as “Seller”).
 
W I T N E S S E T H :
 
WHEREAS, Seller is the record and beneficial owner of all of the issued and
outstanding shares of the capital stock of Artisan Specialty Foods, Inc., an
Illinois corporation (the “Company”); and
 
WHEREAS, Seller wishes to sell, and Purchaser wishes to acquire, all of the
issued and outstanding shares of the Company (the “Acquired Shares”), subject to
the terms and conditions set forth herein.
 
NOW, THEREFORE, in consideration of the mutual promises contained herein, the
parties hereto agree as follows:
 
1. Definitions.  Capitalized terms used herein shall have the meanings assigned
to them in this Article 1 unless such terms are defined elsewhere in this
Agreement.
 
1.1 “Action” means any action, suit, bankruptcy proceeding, arbitration,
mediation, inquiry, demand, claim, complaint, proceeding, dispute or
investigation, whether in law or in equity.
 
1.2  “Acquired Shares” shall have the meaning assigned to it in the preamble of
this Agreement.
 
1.3 “Affiliate” means, as to the Person in question, any other Person that
controls, is controlled by, or is under common control with, the Person in
question; and the term “control” means possession of the power to direct or
cause the direction of the management and policies of a Person whether through
ownership of voting securities, by contract, or otherwise.
 
1.4 “Affiliated Group” means any affiliated, consolidated or unitary group of
which Seller or Company is or was a member.
 
1.5 “Agreement” shall have the meaning set forth in the introductory paragraph
of this Agreement.
 
1.6 “Assets” means (a) all of the assets, properties, privileges, claims and
rights owned, leased, licensed, used or held for use by Company in connection
with, or that are otherwise related to, the Business, as a going concern, of
every kind, nature and description, wherever located, whether such assets,
properties, privileges, claims and rights are real, personal or mixed, tangible
or intangible, whether or not any of such assets, properties, privileges, claims
and rights have any value for accounting purposes or are carried or reflected on
or specifically referred to in the Financial Statements, as such assets,
properties, privileges, claims and rights exist on the date of this Agreement
and (b) all other assets of any kind or nature, tangible or intangible, with
respect to which Company holds any right, title or interest.  The above
notwithstanding, the term “Assets” shall not include an $80,000 receivable of
the Company from John Vohaska or a $179,044 receivable of the Company from W.A.
Imports, Inc.
 
 
 

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1.7 “Business Day” means any day of the week except Saturdays, Sundays or any
day on which banking institutions in New York, New York are authorized or
required by law or executive order to remain closed.
 
1.8 “Closing” shall have the meaning set forth in Section 10.1.
 
1.9  “Closing Date” shall have the meaning set forth in Section 10.1.
 
1.10 “Closing Cash Payment” means One Million Two Hundred Thousand Dollars
($1,200,000).
 
1.11  “Closing Purchase Price” means up to One Million Five Hundred Thousand
Dollars ($1,500,000) consisting of the Closing Cash Payment and the Earn-Out
Payment.
 
1.12 ”Earn-Out Payment” means Three Hundred Thousand Dollars ($300,000) due and
payable to Seller in the event Purchaser has EBIT of at least $450,000 in each
of the twelve month periods following the Closing Date. The schedule of advance
payments described in Sections 6(a) and (d) shall not be deemed earned if EBIT
was less than $450,000 for each of the two years following the Closing Date.
 
1.13 “COBRA” means the Consolidated Omnibus Reconciliation Act of 1985, as
amended.
 
1.14 “Code” means the Internal Revenue Code of 1986, as amended.
 
1.15 “Confidentiality Agreement” shall have the meaning set forth in
Section 14.12.
 
1.16 “Contracts” means written or oral contracts, leases, licenses, agreements,
arrangements, commitments, instruments or understandings.
 
1.17 “Current Liabilities” means the Company’s current liabilities determined in
accordance with GAAP in a manner consistent with the Financial Statements.
 
1.18  “Dollars” and “$” shall mean currency of the United States of America.
 
1.19 “Domain Names” means the domain name(s) listed on Schedule 1.19.
 
1.20 “Eligible Inventory” means inventories of consumable items reflected in the
Financial Statements, but excluding any items in any material amount that are
below standard quality, damaged, obsolete or of a quantity or quality not usable
or suitable in the ordinary course of business.
 
1.21 “Employee Plan” shall have the meaning set forth in Section 4.18(b).
 
 
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1.22 “Employment Agreement” has the meaning set forth in Section 10.2(e).
 
1.23 “Encumbrances” means any and all mortgages, pledges, security interests,
encumbrances, community property interests, conditions, equitable interests,
options, warrants, attachments, rights of first refusal, preemptive, conversion,
put, call or other claim or rights, restrictions on use, voting, receipt of
income, transfer (other than restrictions imposed by federal and state
securities laws) or exercise of any other attribute of ownership or liens or
charges of any kind or nature whatsoever.
 
1.24 “Environmental Laws” means all Laws related to the environment, natural
resources, or the handling, use, recycling, generation, treatment, storage,
transportation or disposal of Hazardous Materials and health and safety, and any
common law cause of action relating to the environment, natural resources,
safety, health or the management of or exposure to Hazardous Materials.
 
1.25 “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.
 
1.26 “ERISA Affiliate” means any Person which, by reason of its relationship
with Company, is required to be aggregated with Company under Sections 414(b),
414(c) or 414(m) of the Code, or which, together with Company, is a member of a
controlled group within the meaning of Section 4001(a) of ERISA.
 
1.27 “Business” means the commercial operations of the Company as conducted
prior to the date hereof which is the business of wholesale food Products.
 
1.28 “Exchange Act” means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder
 
1.29 “FDA” means the United States Food and Drug Administration.
 
1.30 “GAAP” means generally accepted accounting principles in effect on the date
hereof as set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or as
may be accepted generally by the accounting profession of the United States.
 
1.31 “Government Entity” means any United States or foreign, federal, state or
local court or tribunal or administrative, governmental or regulatory body,
agency, commission, division, department, board, bureau, public body,
instrumentality or other authority.
 
1.32 “Hazardous Materials” shall have the meaning set forth in Section 4.14(b).
 
1.33 “Included Contracts” means the Contracts included among the Assets.
 
1.34 “Indemnified Party” shall have the meaning set forth in Section 13.4(a).
 
1.35 “Indemnifying Party” shall have the meaning set forth in Section 13.4(a).
 
 
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1.36 “IRS” means U.S. Internal Revenue Service.
 
1.37 “Premises” means the entire property, building and lot located at 8121
Ogden Avenue, Lyons, IL 60534 where the operations of the Business are currently
located.
 
1.38 “Products” means the Company’s products as of the Closing Date, together
with any products that have been sold or marketed by the Company at any time
prior to the Closing Date.
 
1.39 “Law” means any statute, rule, judicial opinion, regulation or ordinance of
any Government Entity.
 
1.40 “Loss” shall have the meaning set forth in Section 13.1.
 
1.41 “Material Adverse Change” or “Material Adverse Effect” means a material
adverse effect on or a material adverse change in the business, assets,
liabilities, revenues, costs and expenses, income before provision for income
taxes, operations or condition, financial or otherwise, of the Company taken as
a whole.  In determining whether any individual event would result in a Material
Adverse Effect, notwithstanding that such event does not of itself have such
effect, a Material Adverse Effect shall be deemed to have occurred if the
cumulative effect of such event and all other then existing events would result
in a Material Adverse Effect.
 
1.42 “Material Contract” means any Contract that involves either the remaining
payment or the remaining receipt of goods, services or money with a value in
excess of Five Thousand Dollars ($5,000).
 
1.43 “Non-competition Agreement” means the non-competition agreement in the form
included in the Employment Agreement.
 
1.44 “Notice of Claim” shall have the meaning set forth in Section 13.4(a).
 
1.45 “OSHA” means the Occupational Safety and Health Act, as amended.
 
1.46 “Permits” means all franchises, approvals, permits, authorizations,
licenses, orders, registrations, certificates, variances, and other similar
permits or rights obtained by Company from any Government Entity and all pending
applications therefor.
 
1.47 “Permitted Liens” mean (a) statutory liens for Taxes to the extent that the
payment thereof is not past due or to the extent the taxpayer is contesting such
Taxes in good faith through appropriate proceedings, (b) statutory or common law
liens to secure landlords, lessors or renters under real or personal property
leases or rental agreements to the extent that no payment or performance under
any such lease or rental agreement is in default, arrears or is otherwise past
due, (c) deposits or pledges made in connection with, or to secure payment of,
workers’ compensation, unemployment insurance or old age pension programs
mandated under applicable Laws, (d) statutory or common law liens in favor of
carriers, warehousemen, mechanics and materialmen, statutory or common law liens
to secure claims for labor, materials or supplies and other like liens, which
secure obligations to the extent the payment thereof is not in arrears or
otherwise past due, (e) for any Asset with respect to which Company is a lessee
or licensee, any residual right, title or interest in or to such Asset held by
the lessor or licensor of such Asset, and (f) other imperfections of title and
Encumbrances that do not, individually or in the aggregate, impair the continued
use and operation of the Assets.
 
 
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1.48 “Person” means and includes an individual, a partnership, a joint venture,
an association, a corporation, a trust, an unincorporated organization, a
limited liability company or partnership, and a Government Entity.
 
1.49 “Product Liability” means a liability arising out of death, personal injury
or damage to property allegedly caused by a product or service.
 
1.50 “Purchaser” shall have the meaning assigned to such term in the
introductory paragraph of this Agreement.
 
1.51 “Real Property” shall have the meaning set forth in Section 4.7(a).
 
1.52 “Related Documents” shall have the meaning set forth in Section 3.2.
 
1.53 “Restrictive Agreement” means an agreement that prohibits or limits
Company’s (or its Affiliate’s) use of a Trade Right of another Person or
prohibits Company (or its Affiliates) from engaging, or curtails or restricts
the nature or scope of Company’s (or its Affiliate’s) activities, in any line of
business or geographic territory.
 
1.54 “SEC” means the U.S. Securities and Exchange Commission.
 
1.55 “SEC Reports” means all forms, reports and documents filed by Purchaser
with the SEC since January 1, 2009 or incorporated by reference thereunto.
 
1.56 “Securities Act” means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
 
1.57 “Seller” shall have the meaning assigned to such term in the introductory
paragraph of this Agreement.
 
1.58 “Taxes” means any and all taxes, levies or other like assessments, charges
or fees (including estimated taxes, charges and fees), including, without
limitation, income, corporation, capital stock, add-on minimum, ad valorem,
advance corporation, gross receipts, transfer, excise, property, real estate
taxes and assessments, sales, use, value-added, license, payroll, employment,
severance, pay as you earn, withholding on amounts paid by or to the relevant
party, social security and franchise or other governmental taxes or charges,
imposed by any Governmental Entity; and such term shall include any interest,
penalties or additions to tax attributable to such taxes.  Such term also shall
include any interest, fines or penalties levied as a result of failure to file a
Tax Return or the delinquent filing of any Tax Return.
 
1.59 “Tax Return” means any report, return, statement or other written
information required to be supplied to a taxing authority in connection with
Taxes.
 
1.60 “Third Party Claim” shall have the meaning set forth in Section 13.4(b).
 
 
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1.61 “Trade Right” means a patent, claim of copyright, trademark, trade name,
brand name, service mark, logo, symbol, trade dress or design, or representation
or expression of any thereof, or registration or application for registration
thereof, or any other invention, trade secret, technical information, know-how
or other proprietary right or intellectual property.  The term “Trade Right”
shall also include all other digital properties owned or utilized by the Company
including, but not limited to, facebook profiles digital catalogs, etc.
 
1.62 “Undisclosed Liabilities” means any and all liabilities of Company
(including contingent liabilities and liabilities unknown to Company or Seller)
for claims arising out of, resulting from, or otherwise relating to, actions or
omissions that occurred prior to the Closing Date and are not any one of the
following:  (a) reflected in the Financial Statements, (b) current liabilities
incurred in the ordinary course of Company’s business since January 1, 2012 or
(c) otherwise disclosed on a schedule to this Agreement; provided, however, no
Product Liability claim against Company shall constitute an Undisclosed
Liability under this Section unless Seller had knowledge of, or reason to know
of, the potential of such claim at or prior to the Closing Date.
 
1.63 “Financial Statements” shall have the meaning assigned to such term in
Section 4.8.
 
1.64 “Arbitrating Accountants” means the accounting firm RBSM LLP.

1.65 “Earn-out Objection Notice” has the meaning set forth in Section 6(g).

1.66 “EBIT” means for the applicable period the earnings of the Purchaser from
continuing operations from the sale of its products before interest and income
taxes, each of such items calculated in accordance with GAAP and on a basis
consistent with the Financial Statements.

1.67 “Post-Closing Statement” has the meaning set forth in Section 6(f).
 
1.68 “Seller’s Review Period” has the meaning set forth in Section 6(g).
 
1.69 “Payment Schedule” means monies that Purchaser advances to Seller as per a
set schedule of payments.  Funds paid pursuant to the Payment Schedule do not
reflect actual monies earned during the earn-out period.  The amount of advance
payments made pursuant to the Payment Schedule earned or owed will be
definitively determined at the end of the two year period commencing on the
Closing Date.
 
2. Purchase and Sale of the Acquired Shares.
 
2.1 Transfer of Acquired Shares.  On the basis of the representations and
warranties of the parties hereto and subject to the terms and conditions set
forth in this Agreement, on the Closing Date, Seller agrees to sell and transfer
to Purchaser and Purchaser agrees to purchase from Seller, all of Seller’s
right, title and interest in and to the Acquired Shares, free and clear of all
Encumbrances.
 
 
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2.2 Closing Payments.  On the Closing Date and in consideration for the Acquired
Shares sold and transferred to Purchaser pursuant to Section 2.1, Purchaser
shall deliver to Seller the Closing Cash Payment in cash by means of a wire
transfer of immediately available funds by 2:00 p.m., New York City time, less
any funds Purchaser wires directly to any secured creditors of the Company on
the Closing Date to allow any such secured creditors to release their liens on
the Assets.
 
3. Representations and Warranties of Seller.  Seller represents and warrants to
Purchaser as set forth below.  Information in any schedule to this Agreement
qualifies the representations and warranties to which such schedule expressly
refers (or makes cross reference), as well as other representations and
warranties in this Agreement only to the extent that it is sufficiently and
reasonably clear from such information that it qualifies such other
representations and warranties.
 
3.1 Ownership.  Seller holds of record and owns beneficially that number of
shares of capital stock in Company set forth opposite his name on Schedule 3.1,
free and clear of any Encumbrances, which represents all of the outstanding
equity interests of Company.  Seller is not a party to any voting trust, proxy,
or other agreement, commitment or understanding with respect to the voting,
dividend rights or disposition of any shares of capital stock of Company.
 
3.2 Seller’s Authority.  Seller has the power and authority to execute and
deliver this Agreement and all other agreements, documents, certificates and
instruments required to be executed and delivered pursuant hereto (collectively,
the “Related Documents”) by him and to perform his obligations contemplated by
this Agreement and such Related Documents.  This Agreement and each Related
Document to which Seller is a party have been duly executed and delivered by
Seller, and this Agreement and such Related Documents constitute the valid,
binding and enforceable obligations of Seller, enforceable in accordance with
their terms, subject to applicable bankruptcy, reorganization, insolvency,
moratorium and other laws affecting creditors’ rights generally, from time to
time, in effect and to general equitable principles.
 
3.3 Consents and Approvals.  Except as set forth on Schedule 3.3, no filing
with, and no permit, authorization, license, consent or approval of, any
Government Entity or any other Person is necessary for the execution, delivery
and performance of this Agreement or the Related Documents by Seller and the
consummation of the transactions contemplated by this Agreement and the Related
Documents.
 
3.4 No Conflict or Violation.  Except as set forth on Schedule 3.4, neither the
execution, delivery or performance of this Agreement or any Related Document by
Seller, nor the consummation by Seller of the transactions contemplated hereby
or thereby, nor compliance by Seller with any of the provisions hereof or
thereof, will (i) result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a default (or give rise to any
right of termination, cancellation, vesting, payment, exercise, acceleration,
suspension, revocation or modification) under, any of the terms, conditions or
provisions of any note, credit agreement, bond, mortgage, deed of trust,
security interest, indenture, lease, license, Contract, agreement, plan or other
instrument or obligation to which Seller is a party or by which he or any of his
properties or assets may be bound or affected, or (ii) violate any judgment,
order, writ, injunction, decree, statute, rule or regulation applicable to
Seller or any of his properties or assets, except for such violations, breaches,
defaults, or rights of termination, cancellation, acceleration, creation,
imposition, suspension, revocation or modification as to which requisite waivers
or consents have been obtained prior to Closing and copies of which have been
delivered to Purchaser.
 
 
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3.5 Litigation.  Except as set forth on Schedule 3.5, there is no Action pending
or, to the knowledge of Seller, threatened against or affecting Seller, that
could reasonably be expected to impair his ability to perform his obligations
hereunder or under the Related Documents or the transactions contemplated by
this Agreement and the Related Documents nor is there any reasonable basis to
anticipate any such possible Action.
 
4. Representations and Warranties of Seller Concerning Business.  Seller
represents and warrants to Purchaser as set forth below.  Information in any
schedule to this Agreement qualifies the representations and warranties to which
such schedule expressly refers (or makes cross reference), as well as other
representations and warranties in this Agreement only to the extent that it is
sufficiently and reasonably clear from such information that it qualifies such
other representations and warranties.
 
4.1 Organization, Existence and Corporate Authority.  Company is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction in which it was incorporated or organized and has the corporate
power and authority and all necessary government licenses, permits,
authorizations and approvals to own, lease and operate its properties and to
carry on its business as it is now being conducted and has been conducted over
the past forty eight (48) months.  Company is duly qualified or licensed to do
business and is in good standing in each jurisdiction in which the nature of its
business or the ownership or leasing of its properties makes such qualification
or licensing necessary, other than in such jurisdictions where the failure to be
so qualified, individually or in the aggregate, would not have a Material
Adverse Effect.
 
4.2 Capitalization; Ownership of Other Entities.  Schedule 4.2 sets forth the
designations and numbers of all authorized and outstanding capital stock, equity
securities, membership interests or other securities of Company, together with
the name of the holder of record of such capital stock, equity interests,
membership interests or other securities.  Except for the securities set forth
on Schedule 4.2, Company has no capital stock or other equity securities
outstanding.  There are no subscriptions, options, warrants, preemptive rights,
or other rights of any kind to purchase or otherwise receive (upon conversion,
exchange or otherwise) any capital stock or other equity securities of
Company.  Company is not a party to any voting trust, proxy or other agreement,
commitment or understanding with respect to the voting, dividend rights or
disposition of any of its capital stock, membership interests or other
securities.  Company does not own, or have any agreements, commitments or
understandings to acquire, any capital stock or other securities or any direct
or indirect equity or ownership interest in any other Person.
 
4.3 Consents and Approvals.  Except as set forth on Schedule 4.3, no filing
with, and no permit, authorization, license, consent or approval of, any
Government Entity or any other Person is necessary for the execution, delivery
and performance of this Agreement or the Related Documents by Company and/or the
consummation of the transactions contemplated by this Agreement and the Related
Documents.
 
 
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4.4 No Conflict or Violation.  Except as set forth on Schedule 4.4, neither the
execution, delivery or performance of this Agreement or any Related Document,
nor the consummation of the transactions contemplated hereby or thereby, (i)
conflicts with or results in any breach of any provisions of the articles of
incorporation, bylaws or other comparable governing documents of Company, (ii)
results in a violation or breach of, or constitutes (with or without due notice
or lapse of time or both) a default (or gives rise to any right of termination,
cancellation, vesting, payment, exercise, acceleration, suspension, revocation
or modification) under, any of the terms, conditions or provisions of any note,
credit agreement, bond, mortgage, deed of trust, security interest, indenture,
Contract, plan or other obligation to which Company is a party or by which any
of Company’s properties or assets may be bound or affected, (iii) violates any
order, writ, injunction, decree or Law applicable to Company or any of Company’s
properties or assets, (iv) results in the creation or imposition of any
Encumbrance on any asset of Company or (v) causes the suspension, revocation or
modification of any permit, license, governmental authorization, consent or
approval necessary for Company to conduct its business as currently conducted
and as conducted over the past forty eight (48) months, except, in the case of
clauses (ii), (iii), (iv) and (v), for such violations, breaches, defaults or
rights of termination, cancellation, acceleration, creation, imposition,
suspension, revocation or modification as to which requisite waivers or consents
have been obtained by the Company, as applicable, on or prior to Closing and
copies of which have been delivered to Purchaser.
 
4.5 Extent of Assets.  Except for dispositions of assets made in the ordinary
course of Company’s business, the Assets include all of the real (immovable) and
personal (movable) property, intangible (incorporeal) property, rights and other
assets of every kind and nature whatsoever owned, leased, licensed or used by
Company for the conduct of the Business as currently conducted and as conducted
during the past forty eight (48) months.  The Assets constitute all the assets
and properties necessary or desirable to produce, market, sell or distribute the
Products.  Except as set forth on Schedule 4.5, immediately after the Closing
Date, neither Seller nor any of his Affiliates shall own any right, title or
interest in or to, or have or control, any asset, property or other right used
in connection with, related to or necessary to the conduct of, the
Business.  Except as set forth on Schedule 4.5, the Company is the legal and
beneficial owners or lessees, as the case may be, of the Assets free and clear
of all Encumbrances other than the Permitted Liens.
 
4.6 Personal Property.
 
(a) Schedule 4.6(a) sets forth with respect to the Assets and the Business (i)
all items of personal property owned by Company, except for individual items
having an original cost of less than Five Thousand Dollars ($5,000), and (ii)
each lease of personal property of Company, except where the annual rental value
under any such lease is less than Five Thousand Dollars ($5,000).  Company has
good and valid title to all of the personal property purported to be owned by it
free and clear of all Encumbrances, except Permitted Liens.  Seller has
delivered or made available to Purchaser true and complete copies of all leases
and other agreements or documents, but only to the extent that such leases,
agreements or documents would constitute a Material Contract, affecting the
personal property leased by Company, all of which are valid and binding
agreements of Company.
 
 
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(b) Except as set forth on Schedule 4.6(b), each item of personal property owned
or leased by the Company, including all equipment which is currently used in the
Business and production of Products is in the Company’s possession and taking
into account the age of such equipment, is in good operating condition and
repair, adequate for the uses and purposes for which it is being used or
intended, and is available for immediate use in the operation of the business,
and, except as would be natural taking into account the age of such equipment,
none of such equipment requires maintenance or repairs other than ordinary,
routine maintenance and repairs.
 
4.7 Real Property.
 
(a) Company does not own any real property.  Set forth on Schedule 4.7(a)-1 is a
list of leases of all real property currently leased by Company (the “Real
Property”).  The Real Property is the only real property used in the operation
of the Business, and, except as set forth on Schedule 4.7(a)-2, none of the Real
Property is owned by Company, Seller or any of their respective Affiliates.  The
sale of the Acquired Shares to Purchaser and the consummation of the
transactions contemplated by this Agreement do not require the consent of any of
the landlords of any of the Real Property.
 
(b) Seller has delivered to Purchaser true, complete and correct copies of all
leases, together with all amendments and modifications thereof, listed in
Schedule 4.7(a)-1, all of which are binding on the Company named therein, and
with respect to which Company is current in its respective rent payments and is
not otherwise in default in any material respect.
 
(c) The present use of the Real Property is in substantial conformity with all
applicable Laws and with all deed restrictions, and Company has not received any
notice of violation or alleged violation thereof.
 
(d) There are no material capital expenditures required to be made by Purchaser
in connection with the Real Property in order to comply with all applicable
Laws.  No portion of the Real Property has suffered any damage by fire or other
casualty which heretofore has not been repaired or restored and fully paid-for.
 
(e) All requisite certificates of occupancy and other licenses, permits or
authorizations with respect to the buildings, structures, facilities (including
any improvements thereto) on the Real Property and the occupancy and use thereof
have been obtained and are currently in effect.
 
(f) There are reasonable means of ingress and egress from public roads to each
parcel of Real Property.
 
(g) The Real Property has access to such utilities as are necessary for such
property’s occupation and use for the Business.
 
 
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(h) Seller owns the Premises and has the unbridled right to lease it to
Purchaser.  Seller is in compliance with the terms of all mortgages on the
Premises as well as all applicable building codes.
 
4.8 Financial Statements.  Seller has delivered to Purchaser copies of the
unaudited compiled financial statements of Company for the fiscal years ended
December 31, 2009, 2010 and 2011, unaudited compiled financial statements for
each fiscal quarter of 2009, 2010 and 2011 and unaudited compiled financial
statements for 2012 through the month ending prior to the month in which the
Closing Date occurs (collectively, the “Financial Statements”).  The unaudited
Financial Statements are attached hereto as Schedule 4.8.  The Financial
Statements were prepared in accordance with the books and records of Company,
fairly present in all material respects its financial position and results of
operations at and for the periods indicated, and were prepared in accordance
with GAAP applied consistently with prior periods (subject, in the case of
unaudited statements, to nonmaterial year-end adjustments and to the absence of
footnotes).  Any audit by Purchaser of the Financial Statements shall not
relieve Seller of any liability from errors in the Financial Statements.
 
4.9 Indebtedness; Undisclosed Liabilities; Adverse Factors.  Schedule 4.9-1 sets
forth for Company all of Company’s outstanding indebtedness for borrowed money,
whether secured or unsecured.  Except as set forth on Schedule 4.9-1, Company is
not a party to any loan agreement or the maker or obligor under any promissory
note or other similar undertaking, including any guaranty, for the repayment of
borrowed money or the performance of any other obligation.  Except as set forth
on Schedule 4.9-2, Company has no liabilities of any kind whatsoever, either
accrued, absolute, contingent, determined or determinable or otherwise, except
for liabilities reflected or reserved against in the Financial Statements and
current liabilities incurred in the ordinary course of business since January 1,
2012.  Notwithstanding the liabilities and obligations reflected in the
Financial Statements and except as set forth on Schedule 4.9-3, Company has no
obligation or liability of any nature to Seller or any of his Affiliates.  There
are no Actions for indemnification asserted by any Person against Company under
any Law or agreement or pursuant to the articles of incorporation, bylaws or
similar governing documents of Company, and Seller has no knowledge any facts or
circumstances that might give rise to the assertion of any such Action.  Seller
has no knowledge of any event, condition, set of facts or circumstances,
including without limitation any letter, phone call, email or other
communication, raising the possibility of an Action or a threat of an Action,
which is reasonably likely to have a Material Adverse Effect that it has not
disclosed to Purchaser.  Specific representations and warranties made by Seller
elsewhere in this Agreement or in any Related Document will not in any way limit
the representations and warranties in this Section 4.9.
 
4.10 Absence of Changes.  Except as set forth on Schedule 4.10, since January 1,
2012, the Company has conducted the Business in the ordinary course, and there
has not been:
 
(a) any Material Adverse Change;
 
(b) any material damage, destruction or loss to any of the Assets;
 
 
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(c) except for cash distributions to Seller equal to a reasonable estimate of
the Tax liability incurred by Seller as a result of his ownership of Company,
any declaration, setting aside or payment of any cash or noncash dividend or any
other distribution with respect to Company’s capital stock or membership
interest or any direct or indirect redemption, purchase or other acquisition by
Company of any such stock or interest;
 
(d) any obligation or liability incurred, discharged or satisfied, other than
current liabilities incurred, discharged or satisfied in the ordinary course of
business;
 
(e) any sale, transfer, lease, license, Encumbrance or other disposition of any
Asset other than in the ordinary course of business;
 
(f) any action taken by Company to amend, terminate or waive any material right
belonging to Company other than in the ordinary course of business;
 
(g) any rights transferred or granted under any concessions, leases, licenses,
or other Contracts to any Trade Rights owned or licensed by Company;
 
(h) any wage or salary increase to any officer or employee of Company or any
amendment to or adoption of an Employee Plan (as defined in Section 4.18(b)
herein) other than in the ordinary course of business;
 
(i) any single investment, capital contribution, capital expenditure or any
commitment for any capital expenditure in excess of Five Thousand Dollars
($5,000) outside of the ordinary course of business;
 
(j) other than the transactions contemplated by this Agreement and the Related
Documents, any transaction, Contract or commitment entered into by Company other
than in the ordinary course of business;
 
(k) any loss of one or more suppliers, manufacturers, distributors or customers,
which is reasonably likely to have a Material Adverse Effect on current year
production or sales;
 
(l) any Action pending or, to the knowledge of Seller, threatened, which relates
to Company, the Business or any of the Assets, the outcome of which could
reasonably be expected to have a Material Adverse Effect, including without
limitation any letter, phone call, email or other communication raising the
possibility of an Action or a threat of an Action;
 
(m) (i) the incurrence of any indebtedness for borrowed money, other than
borrowings under existing credit facilities, (ii) the making of any loans or
advances to any other Person, other than routine advances to employees
consistent with past practice or (iii) the assumption, guarantee or endorsement
(whether directly, contingently otherwise) for the obligations of any other
Person;
 
(n) any compromise or settlement of, or the taking of any material action with
respect to, any Action;
 
 
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(o) the entrance into or amendment of any employment, consulting, severance, or
similar agreement with any Person other than in the ordinary course of business,
except with respect to new hires or routine salary increases (consistent in
amount with past practice) in the ordinary course of business;
 
(p) any material change in any of Company’s methods of accounting or accounting
practice or policy, except as required by any changes in GAAP or applicable Law;
 
(q) the entrance into any agreement the purpose or effect of which is to
restrain, limit, or impede Purchaser’s ability to conduct the Business following
the Closing;
 
(r) the entrance into any other agreements, commitments or contracts which
create liabilities other than in the ordinary course of business;
 
(s) the authorization or commitment by Company to make any capital expenditures
other than those capital expenditures incurred by Company in the ordinary course
of business;
 
(t) the cancellation or termination of any insurance policy covering the Assets
other than in the ordinary course of business; or
 
(u) the maintenance of Company’s books and records in a manner inconsistent with
past business practices, except to be in compliance with GAAP or applicable
Laws.
 
4.11 Tax Matters.
 
(a) Except as set forth on Schedule 4.11, (i) the Company, and all members of
Company’s Affiliated Group, if any, have filed on a timely basis (taking into
account any extensions received from the relevant taxing authorities) all Tax
Returns that are or were required to be filed on or prior to the date hereof
with the appropriate taxing authorities in all jurisdictions in which such Tax
Returns are or were required to be filed; (ii) all Taxes due for the periods
covered by such Tax Returns have been fully paid, deposited or adequately
provided for on the Financial Statements or are being contested in good faith by
appropriate proceedings; (iii) there are no Encumbrances as a result of any
unpaid Taxes upon any of the Assets; (iv) no claim has ever been made by an
authority in a jurisdiction where Company (or members of their Affiliated Group)
does not file Tax Returns that Company is or may be subject to taxation by that
jurisdiction; and (v) the Tax Return for 2010 is true, correct and complete in
all material respects.
 
(b) Neither Company nor any of its Affiliates has made with respect to any Asset
any consent under Section 341 of the Code.
 
(c) [Intentionally omitted.]
 
(d) None of the Assets is (i) “tax exempt use property” within the meaning of
Section 168(h) of the Code or (ii) a lease made pursuant to Section 168(f)(8) of
the Code.
 
 
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(e) Company has withheld and paid all Taxes required to have been withheld and
paid in connection with amounts paid (or deemed to have been paid) or owing by
Company to any employee, independent contractor, creditor, or other third party
in respect of the period prior to the Closing Date.
 
(f) There are no federal, state, local or foreign audits or other administrative
proceedings or court proceedings presently pending with regard to any Taxes or
Tax Returns of Company, nor have there been any inquiries or any other
communication of any kind with any Government Entity with respect to Taxes or
Tax Returns of the Company.
 
(g) There are no deficiencies against Company as a result of any IRS or other
Government Entity examination that have not been resolved in full, and Company
has not granted any requests, agreements, consents or waivers to extend the
statutory period of limitations applicable to the assessment of any Taxes for
which Company may be liable.
 
(h) Company has not been a member of an affiliated group of corporations filing
a consolidated federal income Tax Return.  Company has no liability for the
Taxes of any Person under Section 1.1502-6 of the Treasury Regulations (or any
similar provision of state, local or foreign law), as a transferee or successor,
by contract or otherwise.
 
(i) Complete copies of all (i) Tax Returns (or in the case of Tax Returns filed
for an Affiliated Group, the portion of such consolidated or unitary Tax Returns
relating to Company) for the Company, for taxable periods ending after December
31, 2006 and (ii) examination reports and statements of deficiencies assessed
against or agreed to by Company since its inception have been made available to
Purchaser for their review.
 
(j) Company has not been a United States real property holding corporation
within the meaning of Section 897(c)(2) of the Code during the applicable period
specified in Section 897(c)(1)(A)(ii) of the Code.
 
(k) Company has disclosed on its U.S. federal income Tax Returns all positions
taken therein that could give rise to a substantial understatement of federal
income Tax within the meaning of Section 6662 of the Code.
 
(l) Company is not a party to any tax sharing, tax indemnity or other agreement
or arrangement relating to Taxes with any Person.
 
(m) Company is not and has never been a member of any affiliated, consolidated
or unitary group for Tax purposes.
 
4.12 Accounts Receivable and Inventory.  Except as set forth on Schedule 4.12-1,
the accounts receivable of Company reflected on the latest Financial Statements
and those existing at Closing (net of reserves reflected in the Financial
Statements) are valid and genuine and arose from bona fide transactions in the
ordinary course of the Business.  Except as set forth on Schedule 4.12-2, all
inventories of consumable items reflected in the Financial Statements do not
include any items in any material amount that are below standard quality,
damaged, obsolete or of a quantity or quality not usable or suitable in the
ordinary course of business of the Company, except for changes in such
inventories occurring subsequent to January 1, 2012 in the ordinary course of
business.
 
 
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4.13 Material Contracts.
 
(a) Schedule 4.13(a)-1 contains a list of all Material Contracts pertaining to
the Business and/or the Assets.  All Material Contracts are in full force and
effect and are valid and binding obligations of the Company, enforceable in
accordance with their respective terms except as their enforceability may be
limited by bankruptcy, insolvency, moratorium, or other Laws relating to or
affecting creditors’ rights generally, and the exercise of judicial discretion
in accordance with general equitable principles.  Except as set forth on
Schedule 4.13(a)-2, no default and no event that with the giving of notice, the
passage of time or both would constitute an event of default has occurred and is
continuing with respect to any of the Material Contracts (whether by Company or,
to the knowledge of Seller, by any other party to such Material
Contracts).  Except as set forth on Schedule 4.13(a)-3, Company is not a party
to any Restrictive Agreement.  As of the Closing, Company will not be a party to
any loan agreement or the maker or obligor under any promissory note or other
similar undertaking, including any guaranty for any Person’s obligation for
borrowed money or similar arrangement for the repayment of borrowed money.
 
(b) Except as set forth on Schedule 4.13(b)-1, Company is not a party to any
Contract with Seller or any of his Affiliates.  Except as set forth in
Schedule 4.13(b)-2, no current or former officer, director, member, manager,
employee, shareholder or Affiliate of Company (or any Family Member of any of
the foregoing) is presently or, in the last three (3) years has been, (i) a
party to any transaction with Company other than on an arms-length basis
(including any Material Contract providing for the furnishing of services by, or
rental of real or personal property from, or otherwise requiring payments to,
any such officer, director, member, manager, employee, shareholder or Affiliate
(or Family Member) or (ii) the direct or indirect owner of an interest in any
Person which is a present (or potential) competitor, supplier, manufacturer,
distributor or customer of Company, nor does any such Person receive income from
any source other than Company which relates to, or should properly accrue to,
Company.  Except as set forth on Schedule 4.13(b)-3, all loans made by Company
to any shareholder, member, manager, employee, officer or director of Company
(or any Family Member of any of the foregoing), and all loans made by any
shareholder, member, manager, employee, officer or director of Company (or any
Family Member of any of the foregoing) to Company have been fully repaid to or
by Company, as the case may be, without discount and with accrued interest at or
before Closing.
 
4.14 Environmental Matters.
 
(a) None of Seller or the Company has received any notice, including without
limitation any letter, phone call, email or other communication, raising the
possibility of an Action or a threat of an Action, of any violation (or claimed
violation) of any Environmental Laws of any Government Entity having
jurisdiction over Seller, the Company or the Real Property or any Action, either
instituted or planned to be instituted, regarding any of the Environmental Laws
which has not been remedied or cured.
 
(b) Company’s operations are in compliance with all applicable Environmental
Laws, including laws relating to the release, discharge, emission, storage,
treatment, handling or disposal of any hazardous, toxic, radioactive, infectious
or harmful substances or materials, including asbestos and petroleum, including
crude oil or any of its fractions or any material prohibited or regulated by any
Environmental Law (collectively, “Hazardous Materials”).  There has been no
spill, leak, discharge, escape, leaching, dumping or release of Hazardous
Materials at the Real Property while Company has held leasehold title to the
Real Property, and Seller has no knowledge of any such events occurring at the
Real Property prior to its leasing same.
 
 
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(c) Company has not nor currently uses, stores, treats, disposes or otherwise
handles Hazardous Materials except in compliance with all applicable
Environmental Laws.
 
(d) To Seller’s knowledge, no underground storage tanks are located at the Real
Property.
 
(e) There is no written Action or other written notice by any Person alleging
potential liability (including potential liability for investigatory costs,
cleanup costs, governmental response costs, natural resources damages, property
damages, personal injuries, or civil or criminal penalties) arising out of or
relating from (i) the presence or release into the environment of any Hazardous
Materials on the Real Property or (ii) circumstances forming the basis of any
violation of any Environmental Law.
 
4.15 Intellectual Property.
 
(a) Schedule 4.15(a)-1 sets forth, with respect to each Trade Right owned by
Company and registered with any Government Entity or for which an application
has been filed with any Government Entity, (i) a brief description of such Trade
Right, and (ii) the names of the jurisdictions covered by the applicable
registration or application.  Except as set forth on Schedule 4.15(a)-2, Company
owns any material unregistered Trade Rights.  Schedule 4.15(a)-3 identifies and
provides a brief description of each Trade Right licensed to Company by any
Person (except for any Trade Right that is licensed to Company under any third
party software license generally available to the public at a cost of less than
$5,000), and identifies the license agreement under which such Trade Right is
being licensed to Company.  The Company has good, valid and marketable title to
all of the owned Trade Rights identified in Schedule 4.15(a)-1, free and clear
of all Encumbrances, and have a valid right to use all of the licensed Trade
Rights identified in Schedule 4.15(a)-3 pursuant to the terms of the applicable
license.  All of the Trade Rights identified in Schedule 4.15(a)-1 are valid and
subsisting and in full force and effect, are free from any claim of abandonment
for non-use or dedication to the public domain, and have not been claimed or
adjudged invalid or unenforceable in whole or in part.  Except as set forth in
Schedule 4.15(a)-4, Company is obligated to make any payment to any Person for
the use of any Trade Rights.  Company has not developed jointly with any other
Person any Trade Rights with respect to which such other Person has any
rights.  Company has not granted and Company is not obligated to grant any
Encumbrance or license in respect to any Trade Right to any Person other than
Purchasers.  All documents necessary to establish Company’s interests in its
registered Trade Rights, or Trade Rights with respect to which an application is
pending, are in its possession and all formalities in relation thereto have been
met, except where the failure to possess such documents and to meet such
formalities are not reasonably expected to have a Material Adverse Effect.
 
 
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(b) To Seller’s knowledge, the confidentiality and secrecy of Company’s trade
secrets and confidential information have not been compromised.
 
(c) None of the Trade Rights owned, used or licensed by Company currently
infringes or conflicts with any Trade Rights owned, used or licensed by any
other Person.  Company is not infringing, misappropriating or making any
unlawful use of, and Company has not, at any time infringed, misappropriated or
made any unlawful use of, or received any notice or other communication of any
actual, alleged, possible or potential infringement, misappropriation or
unlawful use of, any Trade Rights owned, used or licensed by any other
Person.  To Seller’s knowledge, no other Person is infringing, misappropriating
or making any unlawful use of, and no Trade Rights owned, used or licensed by
any other Person infringe or conflict with, any Trade Rights owned, used or
licensed by Company.
 
(d) The Assets include all the Trade Rights necessary to conduct the Business in
the manner in which such business is being conducted as of the date of this
Agreement and has been conducted over the past forty eight (48) months.  None of
the Trade Rights are licensed to any Person (other than the Company) on an
exclusive basis, and, except as provided in the license agreements listed on
Schedule 4.15(a)-3, there is no covenant not to compete or Contract limiting
Company’s ability to exploit fully any of its owned or licensed Trade Rights or
to transact business in any market or geographical area or with any Person.
 
(e) Schedule 1.19 lists all of the domain names owned by the Company, all of
which it owns free and clear and no other person or entity has any rights to
them.  Schedule 1.19 also lists any domain names used by the Company which it
does not own, with a brief description of its rights to use such domain names.
 
4.16 Compliance with Laws.  Company is in compliance with all applicable Laws,
including specifically, but without limitation, OSHA, rules and regulations
promulgated by the FDA and pursuant to the US Public Health Services Act, and
all applicable judgments, orders or decrees of any court or other Government
Entity relating to or affecting the Assets or the operation of the Business,
except where the failure to so comply would not have a Material Adverse
Effect.  Schedule 4.16 lists all Government Entities with regulatory authority
over the Company.  Schedule 4.16 also lists and describes any interactions of
any kind between the Company and any Government Entity since January 1, 2010.
 
4.17 Litigation.  Except as set forth on Schedule 4.17, there is no Action
pending or, to the knowledge of Seller, threatened against or affecting Company,
the Business and/or the Assets, whether involving or relating to Product
Liability or compliance with OSHA or otherwise, or any basis in fact therefor
known to Seller against or involving Company, the Business and/or the Assets or
any of the employees of Company, whether involving or relating to Product
Liability or compliance with OSHA or otherwise, whether at law or in
equity.  Moreover, except as set forth on Schedule 4.17, to Seller’s knowledge,
there is no Action pending or threatened against or affecting Company, the
outcome of which could reasonably be expected to impair the ability of Company
to perform its obligations hereunder or under the Related Documents or the
transactions contemplated by this Agreement and the Related Documents.
 
 
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4.18 Employment.
 
(a) Labor Matters.
 
(i) Company is in compliance with all applicable Laws regarding employment and
employment practices, terms and conditions of employment, wages and hours and is
not and has not engaged in any unfair labor practice.
 
(ii) Company is not a party or otherwise subject to any collective bargaining or
any other written agreements governing the wages, hours and terms of employment
of its employees.  There is no (A) unfair labor practice complaint against
Company pending before the National Labor Relations Board (or any comparable
foreign labor board), (B) labor strike, slowdown, work-to-rules, go-slows, or
work stoppage (official or unofficial) actually occurring or, to the knowledge
of Seller, threatened against Company, nor has there been during the period of
six (6) years immediately preceding the Closing Date, (C) representation
petition respecting Company’s employees pending before the National Labor
Relations Board (or any comparable foreign labor board), (D) pending grievance
or arbitration proceeding arising out of or under collective bargaining
agreements applicable to Company or (E) union organizational campaign in
progress currently with respect to Company’s employees, nor has there ever been
such an organizational campaign.
 
(iii) Company has not (A) recognized or received a demand for recognition of any
collective bargaining representative with respect to any proposed collective
bargaining agreement or (B) experienced any primary work stoppage or other
organized work stoppage involving its employees in the past three (3) years.
 
(iv) No current employee has given or has been given notice to terminate his
office or employment or will be entitled to give notice as a result of the
provisions of this Agreement.
 
(v) There is no outstanding or, to Seller’s knowledge, threatened or intimated
any Action against Company on the part of any individual who has been or is an
employee of Company (or the dependant of any such individual) or any actual or
known liability to make any payment to any such individual, and none of the
provisions of this Agreement, including the identity of Purchaser, to Seller’s
knowledge, is likely to lead to any such dispute.
 
(vi) Company has in relation to its employees (and so far as relevant to its
former employees) complied with:  (A) all obligations imposed on it by
applicable Law and all codes of conduct and practice relevant to the relations
between it and its employees or it and any recognized trade union and has
maintained current, accurate and suitable records regarding the service
agreements and terms and conditions of employment of each of its employees
(including records kept and returns lodged in relation to statutory sick pay);
(B) all obligations to maintain adequate and suitable records regarding the
service of each of its employees; (C) all collective agreements, recognition
agreements and the conditions of service of its employees; and (D) all relevant
orders and awards made under any relevant statute, regulation or code of conduct
and practice affecting the conditions of service of its employees.
 
 
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(vii) There is no individual currently or provisionally employed by Company who
is currently on leave or absent from work and now has or may in the future have
a right to return to work (whether for reasons connected with maternity leave,
leave for family or domestic reasons or absence due to illness or incapacity or
otherwise) or a right to be reinstated or re-engaged by Company or to receive
any other compensation from Company.
 
(viii) No employee of Company is subject to any disciplinary action or engaged
in any grievance procedure, and there is no matter or fact giving rise to the
same.
 
(ix) There are no loans outstanding from Company to any of its employees.
 
(b) Employee Benefits. Schedule 4.18(b)-1 contains a true and correct list of
each “employee benefit plan” as such term is defined in Section 3(3) of ERISA,
whether or not subject to the provisions of ERISA, or any other employment,
consulting, collective bargaining, equity-based compensation bonus, deferred
compensation, stock option, stock purchase, golden parachute, severance,
vacation, dependent care, employee assistance, fringe benefit, death benefit or
other compensatory or employment-related plan, contract, policy, agreement or
arrangement which is not an “employee benefit plan” as defined in Section 3(3)
of ERISA (each an “Employee Plan”) under which any current or former employee or
other personnel of Company (or their dependents) is covered or in respect of
which Company has or reasonably could be expected to have any liability,
directly or indirectly, which will not have been satisfied in full at the time
of the Closing.
 
(i) With respect to each Employee Plan, Seller has delivered to Purchaser true
and complete copies of each contract, plan document, summary plan description
and other written material governing or describing the Employee Plan and/or any
related funding arrangements; and, where applicable, the last annual report
(5500 series) filed with the IRS or the Department of Labor, the most recent
balance sheet and financial statements, actuarial reports and valuations, and
the most recent determination letter issued by the IRS.
 
(ii) Each Employee Plan has been maintained and administered in accordance with
its terms and in compliance with the provisions of applicable Law, including the
Code and ERISA.  All contributions, insurance premiums, benefits and other
payments required to be made to or under each Employee Plan have been made or
provided for before the Closing Date.  With respect to each Employee Plan, (A)
no application, proceeding or other matter is pending before the IRS, the
Department of Labor or any other Government Entity; (B) no Action (other than
routine claims for benefits) is pending or, to the knowledge of Seller,
threatened; (C) to the knowledge of Seller, no facts exist which could give rise
to an Action which, if asserted, could result in a material liability or expense
to Company; and (D) to the knowledge of Seller, no prohibited transaction as
defined in Section 4795 of the Code has occurred with respect to any Employee
Plan.
 
(iii) Company has no funded Employee Plans which are intended to be qualified
under Section 401(a) of the Code.
 
(iv) Company does not have an Employee Plan (A) covered by Title IV of ERISA or
by Section 302 of ERISA or Section 412 of the Code or (B) that is or has been a
Multiemployer Pension Plan within the meaning of Section 3(37) of
ERISA.  Company has not, and no ERISA Affiliate has, incurred or could incur any
liability, direct or indirect, contingent or otherwise, under Title IV of ERISA
or Section 302 of ERISA or Sections 412 or 4980B of the Code.  No Employee Plan
provides health or death benefits (whether or not insured) to any current or
former employee or other personnel beyond the termination of their employment or
other services except as required by Section 4980B of the Code.  Except as
identified on Schedule 4.18(b)-2, each Employee Plan may be unilaterally
terminated and/or amended by Company at any time without liability or penalty.
 
 
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(v) The consummation of the transactions contemplated by this Agreement and the
Related Documents will not (either alone or in conjunction with another event,
such as a termination of employment or other services) entitle any employee or
other Person to receive severance or other compensation that would not otherwise
be payable absent the consummation of the transactions contemplated by this
Agreement and the Related Documents or cause the acceleration of the time of
payment or vesting of any award or entitlement under any Employee Plan.  No
payment or benefit which will or may be made by Company will be characterized as
an “excess parachute payment” within the meaning of Section 280G of the Code or
will fail to be deductible by virtue of Section 280G of the Code.
 
(c) Employees.  Schedule 4.18(c)-1 contains a complete and accurate list of all
directors, officers, managers and employees of Company, specifying their names
and job designations, start date, the total annual amount paid or payable as
compensation to each such Person, and the basis of such compensation, whether
fixed or commission, or a combination of fixed and commission, and the accrued
benefits, including accrued sick leave and paid time-off, for such Persons as of
such date.  Schedule 4.18(c)-2 contains a complete and accurate list of all
consultants of Company, specifying their names and the consulting services they
provide.  None of the Persons identified on Schedule 4.18(c)-1 has had any
breaks in service for purposes of determining years of service under the
applicable Employee Plan since the commencement of his or her employment
arrangements with the Company.  Each of the Company’s employees in the United
States is an “at-will” employee, and there are no employment, commission or
compensation Contracts of any kind between Company on the one hand and any of
its employees on the other hand except as disclosed in Schedule 4.18(c)-3.  True
and complete copies of employment and supervisory manuals, employment and
supervisory policies, and written information generally provided to employees
(such as applications or notices), have been provided to Purchaser.  To the
knowledge of Seller, each of Company’s employees is legally permitted to work in
the United States and the State of Illinois, and Company has verified that each
employee for whom a Form I-9 was required on his or her date of hire has on file
at Company a valid Form I-9 and a copy of each such employee’s Form I-9 will be
part of the records of the Business transferred to Purchaser on the Closing
Date.
 
4.19 Insurance.  The properties and operations of the Company, including the
Assets, that are of an insurable nature and are of a character usually insured
by similar businesses, have been continuously insured by the Company since the
inception of the Business, under insurance policies affording coverage with
respect to insurable events that occur within the applicable policy
periods.  Each such insurance policy has been of like kind and quality (with
respect to policy limits, occurrence-based, etc.) since Company’s
inception.  Schedule 4.19 sets forth a complete and accurate list and brief
description of all insurance policies currently held by  Company with respect to
the Assets and any self-insurance trust.  The description of the insurance
policies provided in Schedule 4.19 sets forth a true and complete statement
specifying the name of the insurer, the amount of coverage, the type of
insurance, the policy numbers, and the expiration date of such policies.  Except
as set forth on Schedule 4.19, such insurance policies are in full force and
effect.  Company is not delinquent with respect to any premium payments
thereon.  Company is not in default or breach with respect to any material
provision contained in any such insurance policies.  Company has not received,
and Seller has no knowledge of, any notice or request, formal or informal, from
any insurance company identifying any defects in the Assets that would have a
Material Adverse Effect on the insurability of the Assets.  Company has not been
refused any insurance, and its coverage has not been limited by an insurance
carrier to which it has applied for insurance.
 
 
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4.20 Brokers.  Except as set forth on Schedule 4.20, no broker, finder, or
investment banker is entitled to any brokerage, finder’s or other fee or
commission in connection with the transaction contemplated by this Agreement
based upon arrangements made by or on behalf of the Company or Seller.
 
4.21 Bulk Sales Laws.  Company has complied with all applicable federal, state
or foreign bulks sales laws in connection with the transactions contemplated by
this Agreement.
 
4.22 Product Liability.  There is no claim in respect of Product Liability
outstanding or, to the knowledge of Seller, threatened against Company.  To the
knowledge of Seller, there are no circumstances that are likely to give rise to
any such claim.  Company has not manufactured, sold or supplied any Product
after its expiration date, or sold any Product within seven (7) days of its
expiration date, or any Product or service which to Seller’s knowledge is, was,
or will become, faulty or defective or which does not comply with any warranty
or representation, express or implied, made by or on behalf of Company in
respect of such product or service or with all Laws, standards and requirements
applicable to such Product or service or which was sold or supplied on such
terms that Company accepts an obligation to service or repair or replace such
Product after delivery.
 
4.23 Fair Trading.  No agreement, practice or arrangement carried on by Company
or to which Company is or has prior to the date of this Agreement been a party
infringes, or is or ought to have been registered in accordance with, any
competition, restrictive trade practice, anti-trust, fair trading or consumer
protection law or legislation applicable in any jurisdiction in which Company
has assets or carries on or intends to carry on business or in which the
activities of Company may have an effect.
 
4.24 Permits.  Company has all necessary Permits for the proper and effective
carrying on of the Business in the manner in which the Business is now carried
on.  All such Permits are valid and subsisting, and Seller knows of no reason
why any of them should be suspended, cancelled or revoked whether in connection
with the sale to Purchasers or otherwise.  Schedule 4.24 lists all such Permits.
 
4.25 Customers and Suppliers.
 
(a) Schedule 4.25(a) sets forth a list of each customer of Company that
accounted for more than five percent (5%) of the net sales of Company
(calculated in accordance with GAAP in a manner consistent with the Financial
Statements) in any of the calendar years 2009, 2010 or 2011.  Company has not
received written or oral notice that any of the customers listed on
Schedule 4.25(a) intends to cease purchasing or dealing with Company, nor does
Seller have any knowledge that leads him to believe that any such customer
intends to alter in any material respect the amount of purchases or the extent
of dealings with Company or Purchaser or would alter in any material respect its
purchases or dealings in the event of the consummation of the transactions
contemplated hereby.
 
 
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(b) Schedule 4.25(b) indicates the value of goods and services (based on invoice
price and calculated in accordance with GAAP, as the case may be, in a manner
consistent with the Financial Statements) supplied to Company by the top ten
(10) suppliers and vendors of goods and services to Company during the period
from January 1, 2008 to December 31, 2011.  Company has not received written or
oral notice that any of the suppliers and vendors listed on Schedule 4.25(b)
intends to cease selling or rendering services to, or dealing with, Company, nor
does Seller have any knowledge that leads him to believe that any such supplier
or vendor intends to alter in any material respect the amount of sales or
service or the extent of dealings with Company or Purchaser or would alter in
any material respect its sales or service or dealings in the event of the
consummation of the transactions contemplated hereby.
 
4.26 OSHA Matters.  Company has not received any citation from the Occupational
Safety and Health Administration or any comparable Government Entity or any
Government Entity inspector setting forth any respect in which the facilities or
operations of Company are not in compliance with OSHA (or similar foreign Law),
which non-compliance has not been corrected or remedied and any applicable fines
and/or penalties paid in full to the satisfaction of such Government Entity or
inspector. Schedule 4.26 sets forth a list of all citations heretofore issued to
Company under OSHA (or similar foreign Law) and correspondence from and to OSHA
and any OSHA inspectors during the past five (5) years.
 
4.27 Bank Accounts.  Schedule 4.27 contains a complete and correct list of all
deposit accounts and safe deposit boxes of Company, all powers of attorney in
connection with such accounts, and the names of all Persons authorized to draw
thereon or to have access thereto.
 
4.28 Disclosure.  To the knowledge of Seller, no representation or warranty by
Seller in this Agreement, the Related Documents or any exhibit or schedule
hereto or thereto, contains an untrue statement of material fact, or omits to
state a material fact necessary to make the statements contained herein or
therein, in light of the circumstances in which they were made, not misleading.
 
5. Representations and Warranties of Purchaser and IVFH.  Purchaser and IVFH
represent and warrant to Seller as set forth below.  Information in any schedule
to this Agreement qualifies the representations and warranties to which such
schedule expressly refers (or makes cross reference), as well as other
representations and warranties in this Agreement only to the extent that it is
sufficiently and reasonably clear from such information that it qualifies such
other representations and warranties.
 
 
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5.1 Authority Relative to Agreement.  Purchaser is a corporation validly
existing and in good standing under the Laws of the jurisdiction in which it was
incorporated or organized, and Purchaser has the corporate power and authority
to execute and deliver this Agreement and the Related Documents to be executed
and delivered by it and to perform its obligations under this Agreement and such
Related Documents.  The execution, delivery and performance of this Agreement
and such Related Documents by Purchaser have been duly authorized by all
necessary corporate action on the part of Purchaser, and no other corporate
proceedings of such Purchaser are necessary to authorize the execution, delivery
and performance of this Agreement and such Related Documents by Purchaser.  This
Agreement and each Related Document to which Purchaser is a party has been duly
executed and delivered by Purchaser, and this Agreement and such Related
Documents constitute the valid, binding and enforceable obligations of such
Purchaser, enforceable in accordance with their terms, subject to applicable
bankruptcy, reorganization, insolvency, moratorium and other laws affecting
creditors’ rights generally from time to time in effect and to general equitable
principles.
 
5.2 No Conflict.  Neither the execution and delivery of this Agreement and the
Related Documents to which Purchaser are a party, the consummation or
performance by Purchaser of the transactions contemplated by this Agreement and
those Related Documents, nor the compliance by Purchaser with any of the
provisions of this Agreement and those Related Documents will (a) violate or
breach the certificate of incorporation or bylaws (or similar governing
documents) of Purchaser; (b) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or give rise to
any right of termination, cancellation, vesting, payment, exercise,
acceleration, suspension, revocation or modification) under, any of the terms,
conditions or provisions of any note, credit agreement, bond, mortgage, deed of
trust, security interest, indenture, lease, license, Contract, agreement, plan
or other instrument or obligation to which Purchaser is a party or by which it
or any of its properties or assets may be bound or affected; or (c) violate any
judgment, order, writ, injunction, decree, statute, rule or regulation
applicable to Purchaser or any of its properties or assets.
 
5.3 Litigation.  To Purchaser’s and IVFH ‘s knowledge, there is no Action
pending or threatened against Purchaser or any of its significant subsidiaries
or their respective officers, directors or employees in their capacity as such,
or as a fiduciary with respect to any Employee Plan of Purchaser or IVFH, that
would be required to be described in any SEC Report that is not so described.
 
5.4 Consents and Approvals.  No filing or registration with, notification to and
no permit, authorization, consent or approval of, any Government Entity is
required to be obtained by Purchaser or IVFH in connection with their execution
and delivery of this Agreement or its consummation of the transactions
contemplated hereby, except (i) such filings, registrations, notifications,
permits, authorizations, consents or approvals that result from the specific
legal or regulatory status of any of Seller and the Company or as a result of
any other facts that specifically relate to the Business and/or the Assets, and
(ii) such other filings, registrations, notifications, permits, authorizations,
consents or approvals the failure of which to be obtained, made or given would
not, individually or in the aggregate, materially impair the ability of
Purchaser to consummate the transactions contemplated hereby.
 
 
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5.5 Availability of Funds.  Purchaser and IVFH have cash, or the ability to
obtain cash by means of subsisting credit facilities with financially
responsible third parties, in an amount sufficient to enable them to perform all
of their respective obligations hereunder, including, without limitation,
payment of the Closing Cash Payment.
 
5.6 Intentionally omitted.
 
5.7 Brokers.  No broker, finder, or investment banker is entitled to any
brokerage, finder’s, or other fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf of
either Purchaser or an Affiliate of Purchaser.
 
5.8 Disclosure.  To the knowledge of Purchaser, no representation or warranty by
Purchaser herein, the Related Documents or any exhibit or schedule hereto or
thereto, contains an untrue statement of material fact, or omits to state a
material fact necessary to make the statements contained herein or therein, in
light of the circumstances in which they were made, not misleading.
 
6. Earn-Out Payment Schedule.
 
(a) Advance payments against anticipated Earn-out Payments shall be made
pursuant to the following Payment Schedule:
 
(i) Within 90 days of the Closing Date, Purchaser will make an advance payment
to Seller of $37,500 to be held against actual Earn-out Payments due and payable
as determined pursuant to Sections 6(b) - (e).
 
(ii)  If Purchaser’s EBIT is at least $180,000 during the period commencing on
the Closing Date and ending October 31, 2012, then, within 30 days of the
conclusion of such six (6) month period, Purchaser will make another advance
payment to Seller of $37,500 to be held against actual Earn-out Payments due and
payable as determined pursuant to Sections 6(b) - (e).
 
(iii)  If Purchaser’s EBIT is at least $240,000 during the period commencing on
the Closing Date and ending January 31, 2013, then, within 30 days of the
conclusion of such nine (9) month period, Purchaser will make another advance
payment to pay Seller of $37,500 to be held against actual Earn-out Payments due
and payable as determined pursuant to Sections 6(b) - (e).
 
(b) If Purchaser’s aggregate EBIT for the period commencing on the Closing Date
and ending on April 30, 2013 equals at least $450,000, within 30 days of such
anniversary date Seller shall receive a payment of $150,000 less any advance
payments previously made pursuant to Section 6(a).
 
(c) In the event Purchaser’s EBIT for the period commencing on the Closing Date
and ending on April 30, 2013 is at least $750,000 Seller shall receive an
accelerated earn-out payment of $300,000, less any payments previously made
pursuant to this Section 6 and no further Earn-out Payments will be due.
 
 
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(d) In the event Purchaser has EBIT of at least $450,000 for the period
commencing on the Closing Date and ending on April 30, 2013, the process
described in Sections 6(a) and (b) above shall be followed for the succeeding
twelve (12) months.
 
(e) In the event Purchaser does not have EBIT of at least $450,000 for the
period commencing on the Closing Date and ending on April 30, 2013, then no
advance Earn-out Payments shall be payable during the second year following the
Closing Date. If Purchaser’s EBIT for such second year is at least $450,000,
Seller shall receive an Earn-out Payment equal to $150,000 less any advance
payments previously made pursuant to Section 6(a).
 
(f) Within sixty (60) days following the end of each of the two years discussed
above, Purchaser shall prepare or cause to be prepared a statement setting forth
Purchaser’s EBIT, which shall be calculated in accordance with GAAP in a manner
consistent with the Financial Statements, which shall show the EBIT target and a
calculation showing the advance payments pursuant to the Payment Schedule
previously made, the Earn-out Payments earned, if any, or owed, if any (each a
“Post-Closing Statement”), and deliver such statement to the Seller.
 
(g) If the Seller in good faith disagrees with any Post-Closing Statement, the
Seller may deliver to Purchaser, within thirty (30) days after the Seller’s
receipt of the Post-Closing Statement (the “Seller’s Review Period”), a written
notice (the “Earn-out Objection Notice”) setting forth in reasonable detail (i)
the amounts on the Post-Closing Statement with which the Seller disagrees and
the basis for such disagreement and (ii) the Seller’s proposed corrections to
the Post-Closing Statement; provided, however, that such disagreement must be
based solely upon an alleged failure of the Post-Closing Statement to conform to
the requirements of this Section 6 and/or alleged mathematical errors contained
or reflected therein.  Seller shall be deemed to have agreed with all amounts
contained in the Post-Closing Statement to which no specific objection has been
made.  If the Seller does not deliver an Earn-out Objection Notice prior to the
expiration of Seller’s Review Period, Sellers shall be deemed to agree in all
respects with Purchasers’ calculations and the amounts as set forth in the
Post-Closing Statement shall be final and binding upon Seller and
Purchaser.  Purchaser shall, upon written request, make available to the Seller
and his agents all such documents and information in Purchasers’ possession or
control that is necessary to facilitate the Seller’s review of the Post-Closing
Statement in a timely manner.  During the thirty (30) days immediately following
the receipt by Seller of the Post-Closing Statement, Seller and its
representatives shall be entitled to review such items and will have reasonable
access to any work papers, trial balances and similar materials relating thereto
prepared by Purchasers, their accountants or personnel.
 
(h) If an Earn-out Objection Notice is properly and timely delivered, the Seller
and Purchaser shall negotiate in good faith with each other to attempt to
resolve the disputed amounts set forth in the Earn-out Objection Notice.  If the
Seller and Purchaser are unable to resolve the disputed amounts set forth in the
Earn-out Objection Notice within five (5) Business Days after the Seller’s
delivery of the Earn-out Objection Notice to Purchaser, the Seller and Purchaser
shall cause the Arbitrating Accountants to promptly review this Agreement and
the disputed amounts in the Post-Closing Statement for the purpose of
calculating the correct Earn-out Payment for such Review Period.  The
Arbitrating Accountants shall be entitled to have reasonable access to all such
information, properties, books and records necessary to make such
calculations.  In making any such calculations, the Arbitrating Accountants
shall consider only those amounts in the Post-Closing Statement as to which the
Seller has, in the Earn-out Objection Notice, disagreed.
 
 
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(i) The Arbitrating Accountants shall deliver to the Seller and Purchaser, as
promptly as practicable, but no later than five (5) Business Days after the
Arbitrating Accountants are engaged, a written report setting forth its
calculation of the disputed amounts.  Upon such delivery, such report and the
calculations set forth therein shall be final and binding upon Seller and
Purchaser.  Fees and expenses of the Arbitrating Accountants shall be paid fifty
percent (50%) by Purchaser and fifty percent (50%) by Seller.
 
(j) Whenever an Earn-out payment is due hereunder, an amount of interest,
calculated at an annual rate of 5% from the Earn-out Commencement Date until the
date actually paid shall be added to the relevant Earn-out Payment.
 
(k) Any Earn-out Payment required to be made pursuant to this Section 6 will be
made in cash within ten (10) Business Days after acceptance by Purchaser and the
Seller of the calculation of such payment as provided above or, if an Earn-out
Objection Notice is properly and timely delivered, within ten (10) Business Days
after the applicable Earn-out Payment is finally determined as provided
above.  Earn-out Payments, if any, will be payable by wire transfer to Seller in
accordance with the written instructions of Seller previously given to Purchaser
pursuant hereto; provided that such instructions may be modified at any time by
Seller by delivery of superseding written instructions delivered to Purchaser in
accordance with Section 19.
 
(l) For the avoidance of doubt, no Earn-out Payment will be included in the
calculation of EBIT.
 
7. [Intentionally Omitted.]
 
8. Conditions Precedent to Obligations of Purchaser.  The obligations of
Purchaser hereunder are subject to the satisfaction or written waiver, on or
prior to the Closing Date, of the following conditions:
 
8.1 Representations/Warranties/Covenants.  The representations and warranties of
Seller contained in this Agreement that are qualified by reference to
materiality or “Material Adverse Effect” shall be true in all respects, and
those that are not so qualified shall be true and correct in all respects except
to the extent the failure of any such representation or warranty to be true and
correct could not reasonably be expected to have a Material Adverse Effect, on
and as of the Closing Date as though such representations and warranties had
been made on and as of the Closing Date (other than representations and
warranties made as of a specified date which shall speak as of such specific
date), and each covenant contained in this Agreement to be complied with or
performed by Seller on or before the Closing Date pursuant to the terms hereof
shall have been complied with and performed in all material respects.
 
 
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8.2 Litigation or Proceedings.  No litigation or Action before a Government
Entity seeking to restrain or prohibit the transactions contemplated hereby
shall be pending or threatened, and no injunction, judgment, order, decree or
Law that restrains or prohibits the transactions contemplated hereby shall have
been issued, enacted, or promulgated by any Government Entity.
 
8.3 Governmental and Other Approvals.  All notices, reports, and other filings
required to be made prior to Closing by Seller with, and all licenses, permits,
consents, approvals, authorizations, qualifications or orders required to be
obtained prior to Closing by Seller from, any Government Entity or from any
other Person set forth on Schedule 8.3 in connection with the execution and
delivery of this Agreement and the Related Documents and the consummation of the
transactions contemplated hereby and thereby shall have been made or obtained.
 
8.4 No Material Adverse Change.  There shall have been no Material Adverse
Effect to the assets and the Business since January 1, 2012.
 
8.5 Financial Statements.  The Financial Statements with respect to the years
ended December 31, 2010 and 2011 have been compiled to the reasonable
satisfaction of Purchaser and the results are in line with its expectations.
 
8.6 Closing Deliveries.  Seller shall have made the deliveries required to be
made by it under Section 10.2.
 
8.7 Schedules.  The Schedules hereto shall be full and complete and delivered to
Purchaser no later than five (5) business days from the date hereof and be
satisfactory to Purchaser.
 
9. Conditions Precedent to Obligations of Seller.  The obligations of Seller
hereunder are subject to the satisfaction or waiver, on or prior to the Closing
Date, of the following conditions:
 
9.1 Representations/Warranties/Covenants.  The representations and warranties of
Purchaser contained in this Agreement that are qualified by reference to
materiality or Material Adverse Effect shall be true in all respects and those
that are not so qualified shall be true and correct in all material respects, on
and as of the Closing Date as though such representations and warranties had
been made on and as of the Closing Date (other than representations and
warranties made as of a specified date which shall speak as of such specific
date), and each covenant contained in this Agreement to be complied with or
performed by Purchaser on or before the Closing Date pursuant to the terms
hereof shall have been complied with and performed in all material respects.
 
9.2 Litigation or Proceedings.  No litigation or Action before a Governmental
Entity seeking to materially restrain or prohibit the transactions contemplated
hereby shall be pending or threatened, and no injunction, judgment, order,
decree, or Law that materially restrains or prohibits the transactions
contemplated hereby shall have been issued, enacted, or promulgated by any
Government Entity.
 
 
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9.3 Governmental Approvals.  All notices, reports, and other filings required to
be made prior to Closing by Purchaser with, and all licenses, permits, consents,
approvals, authorizations, qualifications, or orders required to be obtained
prior to Closing by Purchaser from, any Government Entity in connection with the
execution and delivery of this Agreement and the Related Documents and the
consummation of the transactions contemplated hereby and thereby shall have been
made or obtained.
 
9.4 Closing Deliveries.  Purchaser shall have made the deliveries required to be
made by it under Section 10.3.
 
10. Closing.
 
10.1 Closing and Closing Date.  Subject to the satisfaction or waiver of all the
conditions set forth in Article 8 and Article 9, and the written approval of the
Purchaser’s board of directors, the consummation of the sale and purchase of the
Acquired Shares contemplated by this Agreement (the “Closing”) shall take place
at the offices of Feder Kaszovitz LLP, 845 Third Avenue, New York, New York
10022, at 10:00 a.m., local time, on the Closing Date or at such other location
and time as the parties hereto may mutually designate in writing.  It is
contemplated that the Closing will be a “virtual closing” whereby prior to the
Closing Date, Seller and Purchaser will each deliver all of the deliverables
required to be delivered by Sections 10.1 and 10.2, respectively, in the custody
and care of Purchaser’s counsel (Feder Kaszovitz LLP) and such firm will retain
control of such deliverables until confirmation of the delivery to Seller of the
Closing Purchase Price, whereupon such counsel will deliver to each of Seller
(via FedEx) and Purchaser the deliverables each party is entitled to
receive.  All acts, deliveries and confirmations comprising the Closing,
regardless of chronological sequence, shall be deemed to occur contemporaneously
and simultaneously upon the occurrence of the last act, delivery or confirmation
of such Closing, and none of such acts, deliveries or confirmations shall be
effective unless and until the last of the same shall have occurred.  The
Closing shall be effective as of the time the Closing Purchase Price is received
by Seller on the date the Closing occurs (the “Closing Date”).  The Closing
shall occur within ten (10) days after Seller delivers to Purchaser the
Financial Statements in a form satisfactory to Purchaser, but no later than
April 30, 2012.  The above notwithstanding, if the financial statements of the
Company for 2011 are in any way materially different from that reasonably
expected by Purchaser or their delivery to Purchaser is delayed, Purchaser may
extend the Closing Date for up to an additional thirty (30) days.  If the
Closing does not occur by such date, Purchaser’s counsel will promptly return
all of Seller’s deliverables in its possession to Seller’s counsel.
 
10.2 Actions of Seller at Closing.  At the Closing, Seller shall deliver the
following to Purchaser, each in form and substance satisfactory to Purchaser:
 
(a) Certificates of Acquired Shares.  Certificates representing the Acquired
Shares, each duly endorsed for transfer to Purchaser or together with a duly
executed stock power in favor of Purchaser.
 
(b) Resignations.  The resignations, effective at the Closing, of all directors
and officers of Company immediately prior to the Closing.
 
 
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(c) Good Standing Certificate.  A certificate of existence and good standing of
Company from its jurisdiction of incorporation or organization, dated a date
reasonably proximate to the Closing Date.
 
(d) Required Consents.  Evidence that Seller has satisfied the condition
precedent set forth in Section 8.3.
 
(e) Employment Agreement.  The employment agreement executed by Seller (the
“Employment Agreement”) in favor of Purchaser in substantially the form attached
to this Agreement as Exhibit B.
 
(f) Lease.  The lease executed by Seller in favor of Purchaser (the “Lease”) in
substantially the form attached to this Agreement as Exhibit C.
 
(g) Secretary’s Certificates.  With respect to Company, a certificate, dated the
Closing Date, signed by the secretary of Company certifying the certificate of
incorporation and bylaws (or other governing documents) of Company being true
and correct as of the Closing Date.
 
(h) Seller’s Certificate.  A certificate, dated the Closing Date, signed by
Seller certifying that the conditions precedent set forth in Sections 8.1 – 8.6,
to the extent not waived in whole or part by Purchaser, have been satisfied in
accordance with the terms of this Agreement.
 
(i) Payment of Outstanding Secured Debt.  A payoff letter from each secured
creditor along with wire instructions from such secured creditor(s) so Purchaser
may send all such secured creditors an amount from the Closing Cash Payment
necessary to pay all of the Company’s secured debt in full.
 
(j) Letter re Purchaser’s Rights.  A letter complying with the terms of Section
11.7.
 
(k) Receipt.  A receipt signed by Seller, evidencing Seller’s receipt of the
Closing Payment as payment for the Acquired Shares.
 
(l) Opinions of Counsel.  Purchaser shall have received from Di Monte & Lizak ,
LLC legal opinions, dated the Closing Date and addressed to Purchaser, in
substantially the form attached to this Agreement as Exhibit D.
 
(m) Books and Records.  All available original or true and correct copies of all
documents, books, records, forms and files relating to the Assets.
 
(n) Bank Accounts.  All resolutions and other documents required in order to
change the Persons authorized to draw on or have access to the deposit accounts
and safe deposit boxes identified on Schedule 4.27 only to the Persons
designated by Purchaser.
 
(o) Product Lines Certificate.  A true, complete and accurate list of the
Company’s key product lines and the revenues attributable to each such product
line for the twelve (12) month period ending on the date that is ten (10)
Business Days prior to the Closing Date.
 
 
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(p) Financial Statements.  Compiled Financial Statements of the Company for the
years ended December 31, 2010 and 2011, compiled Financial Statements for the
four months ended April 30, 2012 and a compiled balance sheet as of the date
hereof, all of which fairly present in all material respects its financial
position and results of operations at and for the periods indicated, and were
prepared in accordance with GAAP (subject, in the case of unaudited statements,
to nonmaterial year-end adjustments and to the absence of footnotes but
utilizing GAAP methodologies and principles with respect to the accounting
principles and standards utilized in presenting the compiled financial
statements) applied consistently.
 
(q) 2011 Tax Returns.  All Tax Returns for 2011 have been filed with the
appropriate Government Entity.
 
(r) Miscellaneous.  Such other certificates, instruments and documents as may
reasonably be requested by Purchaser.
 
10.3 Actions by Purchasers at Closing.  At the Closing, Purchasers shall deliver
the following to Seller:
 
(a) Payment.  The Closing Purchase Price as payment for the Acquired Shares,
which sum shall be paid as set forth in Section 2.2.
 
(b) Receipt.  A receipt signed by Purchaser evidencing Purchaser’s receipt of
the Acquired Shares acquired by it hereunder.
 
(c) Good Standing Certificate.  A certificate of good standing of Purchaser from
its jurisdiction of incorporation or organization, dated a date reasonably
proximate to the Closing Date.
 
(d) Secretary’s Certificate.  With respect to Purchaser, a certificate, dated
the Closing Date, signed by the secretary of Purchaser certifying (i) the
certificate of incorporation and bylaws (or other governing documents) of
Purchaser being true and correct as of the Closing Date, (ii) resolutions of the
directors of Purchaser, authorizing and approving all matters in connection with
this Agreement and the transactions contemplated hereby, and (iii) the
incumbency of the executive officers of Purchaser executing this Agreement and
any related documents.
 
(e) Officers’ Certificates.  A certificate signed by a duly authorized officer
of Purchaser certifying that the conditions precedent set forth in Sections 9.1
– 9.4, to the extent not waived in whole or part by Seller, have been satisfied
in accordance with the terms of this Agreement.
 
(f) Employment Agreement.  The Employment Agreement executed by Purchaser.
 
(g) Lease.  The lease executed by Seller in favor of Purchaser (the “Lease in
substantially the form attached to this Agreement as Exhibit C
 
 
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(h) Opinion of Counsel.  Seller shall have received from Feder Kaszovitz LLP
opinions, dated the Closing Date and addressed to Seller, in substantially the
form attached to this Agreement as Exhibit D.
 
(i) Such other certificates, instruments and documents as may reasonably be
requested by Seller.
 
11. Certain Additional Covenants.
 
11.1 Post-Closing Access to Information.  Seller and Purchaser acknowledge that
subsequent to the Closing any party hereto may need access to information or
documents in the control or possession of another party hereto (or its
Affiliates) for the purposes of, among other reasons, concluding the
transactions set forth herein, audits, compliance with governmental requirements
and regulations, the prosecution or defense of Third Party Claims and collection
of accounts receivable and payment of accounts payable.  Accordingly, Seller and
Purchaser agree that for a period of seven (7) years after Closing (and such
longer period of time as indemnification obligations exist under Article 13),
each will, without charge, upon the written request of another party hereto,
make available during normal business hours to such other party and its agents,
independent auditors and/or Government Entities all such documents and
information as may be available relating to the Business and the Assets for
periods prior and subsequent to Closing to the extent necessary to facilitate
the matters described above.  Such documents may be examined and, at the
inspecting party’s expense, copied.  Any access to the records of another party
hereto granted in this Agreement shall be upon the condition that any such
access shall be conducted in a manner by the inspecting party so as not to
materially interfere with the business operations of such other party.
 
11.2 Preservation and Access to Records Pertaining to the Assets After the
Closing.  After the Closing, Purchaser shall, in the ordinary course of business
and as required by Law, keep and preserve all employee records and other records
of the Company’s operations existing as of the Closing and which constitute a
part of the Assets owned or held by the Company at Closing; provided that
Purchaser, at any time after the seventh (7th) anniversary of the Closing Date
(or such later date as shall represent the termination date of any
indemnification obligations existing under Article 13), upon not less than sixty
(60) days’ prior written notice to Seller may dispose of such records in its
possession referred to above or those relating to the Business and the Assets,
or any of the transactions contemplated herein, in accordance with Purchaser’s
record retention policies and applicable Law; provided further that Seller may,
at its sole cost and expense, upon written notice to Purchaser given before the
expiration of such sixty (60) day period, take possession of such records.  Upon
reasonable notice during normal business hours at the sole cost and expense of
Seller and upon Purchaser’s receipt of appropriate consents and authorizations,
Purchaser shall afford to the representatives of Seller, including its counsel
and accountants, full and complete access to, and copies of, the records owned
or held by the Company at the time of the Closing.  Any access to the records of
the Assets or Purchaser’s personnel granted to Seller in this Agreement shall be
upon the condition that any such access shall be conducted in a manner by the
Company so as not to materially interfere with the business operations of
Purchaser.
 
 
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11.3 Litigation Cooperation.  After the Closing and subject to the provisions of
Article 13 hereof, upon prior reasonable written request and with the
reimbursement of reasonable out-of-pocket expenses paid by the party making the
request, each party hereto shall cooperate with the other in furnishing
information, testimony and other assistance in connection with any Actions, Tax
audits, or arrangements involving any of the parties hereto (other than in
connection with disputes between the parties hereto) and based upon contracts,
arrangements or acts of any party or any of their Affiliates that were in effect
or occurred on or prior to Closing or that are related to the Acquired Shares,
the Business and/or the Assets, including arranging discussions with, and the
calling as witnesses of, officers, directors, employees, agents and
representatives of the parties hereto.
 
11.4 IRS Code Section 338 Election.   Upon the written request of Purchaser, in
its sole and exclusive discretion, Seller and Purchaser or, as applicable, any
designated Purchaser shall join in making elections under Code Section
338(h)(10) (and any corresponding election under state, local, or foreign law)
(a “Section 338(h) Election”) with respect to Purchaser’s (or any designated
Purchaser’s) purchase of the Acquired Shares pursuant to this Agreement.  In the
event that Seller incurs any tax obligations as a result of the Section 338(h)
Election which are in excess of amounts due had the transactions set forth
herein been taxed as a stock sale, Purchaser hereby agrees to reimburse to
Seller such excess amount and further agrees that the amount that Purchaser
shall be required to reimburse Seller under this paragraph shall (1) be grossed
up to assure that Seller does not incur any Tax cost as a result of the Section
338(h) Election and the reimbursement payments under this paragraph and (2) take
into account the highest marginal income tax rate applicable to payments of this
type at the applicable times as applies to Seller.  Any reimbursement shall be
paid to Seller not less than seven (7) days prior to the time the Seller is
required to file his personal tax returns.
 
11.5 No Rights of Employees.  Other than with respect to Seller who is a party
to the Employment Agreement, after the Closing Date Purchaser shall have the
sole and absolute discretion to continue to employ or terminate the employment
of any employees of the pre-Closing employees of the Company and to determine
the level of compensation and employee benefits to each such employee it chooses
to continue to employ following the Closing.
 
11.6 Delivery of Property Received by Seller After Closing.  Seller agrees that
it shall transfer or deliver to Purchaser, promptly after the receipt thereof,
any cash or other property which Seller receives after the Closing Date in
respect of any Assets owned, used or held for use by the Company in connection
with the Business.
 
11.7 Purchaser Appointed Attorney for Seller.  Seller, shall deliver a letter to
Purchaser effective at the Closing Date, which letter constitutes and appoints
Purchaser, its successors and assigns, the true and lawful attorney of Seller,
in the name of either Purchaser or Seller (as Purchaser shall determine in its
sole discretion) but for the benefit of Purchaser:  (i) to institute and
prosecute all proceedings which Purchaser may deem proper in order to collect,
assert or enforce any claim, right or title of any kind in or to the Acquired
Shares; and (ii) to defend or compromise any and all Actions, in respect of any
of the Acquired Shares, and to do all such acts and things in relation thereto
as Purchaser shall deem advisable.  Seller acknowledges that the foregoing
powers are coupled with an interest and shall be irrevocable.  Purchaser shall
be entitled to retain for its own account any amounts collected pursuant to the
foregoing powers, including any amounts payable as interest in respect
thereof.  Purchaser agrees to act in good faith in seeking to collect, assert or
enforce any Action against any third party in accordance with this
Section 11.7.  Notwithstanding anything contained in this Section 11.7 to the
contrary, Purchaser, its successors or assigns, shall never constitute the true
and lawful attorney of Seller with respect to any matter contemplated by
Article 13.
 
 
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11.8 Removal of Liens.  Promptly after the Closing, but no later than five (5)
business days thereafter, Seller shall take all necessary steps to cause any
secured lenders of the Company to remove all liens against the Company.
 
11.9 Taxes.
 
(a) Tax Returns Through Closing Date.  Seller shall prepare and file on a timely
basis all Tax Returns relating to the Business and the Assets with respect to
all periods through and to the Closing Date and shall pay or cause to be paid
when due all Taxes relating to the Business and the Assets for such periods.
 
(b) Subsequent Liability.  Except for Taxes that have been accrued on the
Financial Statements, if, subsequent to the Closing Date, any liability for
Taxes relating to the Business and the Assets with respect to any period prior
to and including the Closing Date, Seller shall indemnify and hold Purchaser
harmless, from and against, and shall pay, the full amount of, such Tax
liability (as well as reasonable attorneys’, accountant’s or other fees and
disbursements of Purchaser incurred in determination thereof or in connection
therewith), or Seller shall, at its sole expense and in its reasonable
discretion, settle any Tax claim that may be the subject of indemnification
under this Section 11.9(b) at such time and on such terms as it shall deem
appropriate or assume the entire defense thereof; provided that Seller shall not
in any event take any position in such settlement or defense that subjects
Purchaser or its Affiliates to any civil fraud or any civil or criminal
penalty.  Notwithstanding the foregoing, Seller shall not consent, without the
prior written consent of Purchaser, to any change in the treatment of any item
which would, in any manner whatsoever, affect the tax liability of Purchaser or
its Affiliates for a period subsequent to the Closing Date.
 
(c) All transfer, documentary, sales, use, stamp, registration and other such
Taxes and fees (including any penalties and interest) incurred in connection
with the consummation of the transactions contemplated by this Agreement shall
be paid by Seller when due.  Seller shall, at its own expense, file all
necessary Tax Returns and other documentation with respect to all such transfer,
documentary, sales, use, stamp, registration and other Taxes and fees, and, if
required by applicable Law, Purchaser will join in the execution of any such Tax
Returns and other documentation.
 
11.10 Third Party Consents.  Purchaser and Seller will cooperate and use their
respective commercially reasonable efforts to obtain as promptly as practicable
following the Closing all consents, approvals and waivers which have not been
obtained as of the Closing Date required by third Persons pursuant to the terms
of the Included Contracts in a manner that will avoid any default, conflict or
termination of rights under such Included Contracts.  Notwithstanding anything
to the contrary in this Agreement, nothing in this Section 11.10 shall require
Purchaser to expend any material sum, make a material financial commitment or
grant or agree to any material concession to any third Person to obtain any such
consent, approval or waiver.
 
 
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11.11 Intellectual Property Matters.  Seller will, at Purchaser’s reasonable
request, promptly perform all acts and execute all documents, irrevocable powers
of attorney, certificates, affidavits, instruments and agreements, including
instruments of assignment in forms suitable for recording with the United States
Patent and Trademark Office, The United States Copyright Office or any
corresponding foreign office or agency, requested by Purchaser at any time to
evidence, maintain, record, perfect, document or enforce the Company’s interest
in the Trade Rights set forth on Schedule 4.15(a) or otherwise in furtherance of
the provisions of this Agreement and the transactions contemplated hereby.
 
11.12 Securities Law Filings.  Seller shall, and shall cause the accountants of
the Company to, cooperate with Purchaser and its accountants in the provision of
such information and documents as may be reasonably required in order to
complete on a timely basis any filings required under the Exchange Act or other
U.S. securities laws relating to the transactions contemplated by this
Agreement.
 
11.13 Company Name.  Except in connection with Seller’s activities in performing
its obligations under Section 11.17, Seller expressly agrees that, on and after
the Closing Date, Seller shall not have any right, title or interest in any
trade names, trademarks, identifying logos or service marks employing the words
“Artisan Specialty Foods” or any variation thereof or any other trademarks,
service marks, product line names, trade dress or other Trade Rights included
among the Assets or confusingly similar thereto.  Seller agrees that without the
prior written consent of Purchaser, neither he nor any of his Affiliates shall
make any use of the name “Artisan Specialty Foods” or any variation thereof from
and after the Closing Date.
 
11.14 Access Codes and Combinations.  Immediately following the Closing, Seller
shall cooperate with and notify Purchaser with regard to all source and access
codes to computers and computer software that are included among the Assets and
that Seller is licensed and authorized to divulge, combinations to safe(s)
included in or containing Assets and the location of keys to safe deposit boxes
containing Assets, and vehicles included in the Assets, if any, concerning the
Business.
 
11.15 Bulk Sales Laws.  Each of the parties hereto shall comply in all material
respects and in a timely manner with any and all bulk sales laws applicable to
the transactions contemplated by this Agreement that require compliance by such
party, at Seller’s expense.
 
12. [Intentionally omitted].
 
13. Indemnification.
 
13.1 By Seller.  In addition to his indemnification obligations set forth
elsewhere in this Agreement, Seller will, subject to Sections 13.3 and 14.8,
defend, indemnify and hold harmless Purchaser and its Affiliates, and its and
their officers, directors, stockholders, employees, agents, successors and
assigns from and against any and all damages, losses, liabilities, expenses
(including reasonable fees and disbursements of counsel), Actions, Encumbrances
and other obligations whatsoever (individually a “Loss” and, collectively,
“Losses”), arising out of, resulting from or otherwise relating to (a) any
inaccuracy, misrepresentation or breach of any of his representations and
warranties in this Agreement, the schedules or exhibits hereto or in the Related
Documents delivered by Seller pursuant to this Agreement, (b) any breach of any
of his covenants and agreements in this Agreement, the schedules or exhibits
hereto or in the Related Documents delivered by Seller pursuant to this
Agreement, (c) any brokerage, finder’s or other fee or commission owed to any
Person whose name is set forth on Schedule 4.20 and/or (d) Undisclosed
Liabilities.
 
 
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13.2 By Purchaser.  In addition to its indemnification obligations set forth
elsewhere in this Agreement, Purchaser will, subject to Sections 13.3 and 14.8,
defend, indemnify and hold harmless Seller and his Affiliates, agents,
successors and assigns from and against any and all Losses arising out of,
resulting from or otherwise relating to (a) any inaccuracy, misrepresentation or
breach of any representation or warranty made by Purchasers in this Agreement,
the schedules or exhibits hereto or in the Related Documents delivered by
Purchasers pursuant to this Agreement and/or (b) any breach of any of its
covenants and agreements in this Agreement, the schedules or exhibits hereto or
in the Related Documents delivered by Purchasers pursuant to this Agreement.
 
13.3 Limitations.
 
(a) The amount of any Losses for which indemnification is provided hereunder
(whether pursuant to this Article 13 or otherwise) shall be limited to the net
after-tax effect of actual damages and shall be reduced by the amount of any
insurance proceeds received by the Indemnified Party pursuant to any insurance
policy as a result of the Losses giving rise to such indemnification
payment.  Notwithstanding anything herein to the contrary, in the absence of
intentional misrepresentation or fraud no party shall be held liable for
consequential, special or punitive damages.
 
(b) In the event of any breach of any representation, warranty, covenant or
agreement contained herein, the schedules and exhibits hereto or in the Related
Documents, other than the right to bring an action for intentional
misrepresentation or fraud, the sole and exclusive right and remedy of the
parties hereto for money damages shall be a claim for indemnification (i)
pursuant to this Article 13 and/or (ii) as provided by the specific covenant or
agreement at issue.
 
13.4 Procedural Matters.
 
(a) A party intending to claim indemnification hereunder (whether pursuant to
this Article 13 or otherwise) (“Indemnified Party”) must notify, in writing, the
party from whom indemnification is sought (“Indemnifying Party”) promptly after
learning of any Loss, Action or any other fact which, if true, would entitle the
Indemnified Party to indemnification under this Agreement (the “Notice of
Claim”); provided, however, the Indemnified Party’s failure to give prompt
notice shall not constitute a defense (in whole or in part) to any claim by the
Indemnified Party against the Indemnifying Party for indemnification, except and
only to the extent that such failure shall have caused or materially increased
such liability or materially and adversely affected the ability of the
Indemnifying Party to defend against or reduce its liability.
 
 
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(i) A Notice of Claim shall set forth (A) the basis of the claim and a brief
description of the nature of the potential or actual Loss and (B) to the extent
then feasible the total amount of Loss anticipated (including any costs or
expenses that have been or may be reasonably incurred in connection
therewith).  Payment of the amount of actual Loss due the Indemnified Party as
set forth in a Notice of Claim shall be made by the Indemnifying Party no later
than the thirtieth (30th) day after the date of the Notice of Claim (or such
later date as the Indemnifying Party receives written notice that an actual Loss
has occurred), unless the provisions of subsection 13.4(a)(ii) are applicable.
 
(ii) If the Indemnifying Party (acting reasonably) shall reject any Loss as to
which a Notice of Claim is sent by the Indemnified Party, the Indemnifying Party
shall give written notice of such rejection to the Indemnified Party within
thirty (30) days after receipt of the Notice of Claim.  Upon such rejection, the
parties shall attempt in good faith to resolve any disagreement, and payment of
the amount of actual Loss shall be made by the Indemnifying Party within five
(5) Business Days of mutual resolution of any disagreement.  If any such
disagreement remains unresolved as of the forty-fifth (45th) day after receipt
by the Indemnifying Party of the Notice of Claim, the dispute shall be
determined by an independent third party selected jointly by Purchasers and
Seller, and the decision of such third party shall, in the absence of manifest
error, be final and binding on all parties.  If the Notice of Claim is
determined by such third party to be proper, payment of the amount of Loss due
the Indemnified Party as set forth in the Notice of Claim shall be made by the
Indemnifying Party no later than the fifth (5th) Business Day after such
determination is rendered.
 
(b) As a condition precedent to any claim by an Indemnified Party for
indemnification hereunder for any Action instituted by a third party the
liability or the costs or expenses of which are Losses (a “Third Party Claim”),
the Indemnified Party must tender the defense of such Third Party Claim to the
Indemnifying Party in the Notice of Claim.  The Indemnifying Party may undertake
the defense of such Third Party Claim with counsel reasonably acceptable to the
Indemnified Party by notice to the Indemnified Party not later than thirty (30)
days after receiving notice of such Third Party Claim.
 
(c) The Indemnifying Party’s failure to confirm to the Indemnified Party that
the Indemnifying Party will undertake such defense shall be deemed to be a
waiver by the Indemnifying Party of its right to undertake the defense of such
Third Party Claim.  If, however, the Indemnifying Party undertakes the defense
of such Third Party Claim, the Indemnified Party will (i) reasonably cooperate
with the Indemnifying Party and its counsel in the investigation and defense of
such Third Party Claim and (ii) have the right to participate in such
investigation and defense; provided that the Indemnifying Party will control
(subject to the provisions of paragraphs (d) and (e) below) the negotiation,
tactics, trial, appeals and other matters and proceedings related to such claim,
except that the Indemnifying Party will not, without the prior written consent
of the Indemnified Party, require the Indemnified Party to take or refrain from
taking any action, or make any public statement, which the Indemnified Party
reasonably considers to be against its interest, or consent to any settlement
that requires the Indemnified Party to make any payment that is not fully
indemnified by the Indemnifying Party hereunder.
 
(d) If the Indemnifying Party does not undertake the defense of any Third Party
Claim, the Indemnified Party, at the expense of the Indemnifying Party, may
undertake the defense of such Third Party Claim with counsel of its choosing,
and the Indemnifying Party in that event shall reasonably cooperate with the
Indemnified Party and its counsel in the investigation and defense of such Third
Party Claim, but the Indemnified Party will control such investigation and
defense at the expense of the Indemnifying Party.
 
 
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(e) Notwithstanding anything contained in this Section 13.4 to the contrary, if
both the Indemnifying Party and the Indemnified Party are named as parties or
subject to any Third Party Claim and either such party determines with advice of
counsel that a material conflict of interest between such parties may exist in
respect of such Third Party Claim, the Indemnifying Party may decline to assume
the defense on behalf of the Indemnified Party or the Indemnified Party may
retain the defense on its own behalf, and, in either such case, after notice to
such effect is duly given hereunder to the other party, the Indemnifying Party
shall be relieved of any obligation to assume the defense on behalf of the
Indemnified Party, but shall be required to pay the out-of-pocket legal costs
and expenses (such as reasonable attorneys’ fees and disbursements) of such
defense; provided, however, that the Indemnifying Party shall not be liable for
such expenses on account of more than one separate firm of attorneys (and, if
necessary, local counsel) at any time representing such Indemnified Party in
connection with any Third Party Claim or separate Third Party Claim in the same
jurisdiction arising out of or based upon substantially the same allegations or
circumstances.
 
(f) The Indemnified Party and the Indemnifying Party agree to make available to
each other, their respective counsel and other representatives, all information
and documents available to them that relate to any Third Party Claim, and to
render to each other such assistance as may reasonably be requested to ensure
the proper and adequate defense of such Third Party Claim.  The above
notwithstanding, in cases involving a conflict of interest as described in
paragraph (e) above, if counsel advises that sharing specific information or
documents with the other party hereto could be detrimental to such party’s own
defense due to the conflict of interest, then such specific information and/or
documents need not be made available to the other party pursuant hereto.
 
(g) Each Indemnified Party shall take commercially reasonable actions to
mitigate Losses, including pursuing insurance claims and Third Party Claims, and
shall reasonably consult and cooperate with each Indemnifying Party with a view
towards mitigating Losses, in connection with claims for which an Indemnified
Person seeks indemnification hereunder.
 
14. Additional Provisions.
 
14.1 Successors and Assigns, Assignability, Beneficiaries.  This Agreement is
binding upon and inures to the benefit of Seller and Purchaser and their
respective successors and permitted assigns.  Neither this Agreement nor any
obligation hereunder will be assignable except with the prior written consent of
Purchaser and Seller.  Notwithstanding the preceding sentence, Purchaser may
assign all or any part of their respective rights and obligations under this
Agreement to one or more Affiliates.  Nothing herein, express or implied, is
intended to confer on any Person (other than the parties hereto and their
respective successors and permitted assigns) any rights, remedies, obligations
or liabilities under or by reason of this Agreement.
 
 
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14.2 Notices.  All notices which are required by or may be given pursuant to the
terms hereof must be in writing and must be delivered personally; sent by
certified mail, return receipt requested, postage prepaid; sent by facsimile
(with written confirmation of transmission) provided that notice is also sent
via first class mail, postage prepaid; or sent for next Business Day delivery by
a nationally recognized overnight delivery service as follows:
 
 
If to Seller:
David Vohaska

 
5 Arcadia Court

 
Burr Ridge, Illinois  60521

 
Tel. No.: (630) 986-0347

 
Fax No.: _______________

 
with a copy to:
Di Monte & Lizak, LLC

 
216 Higgins Road

 
Park Ridge, Illinois  60068

 
Tel. No.:  (847) 698-9600

 
Fax No.:  (847) 698-9624

 
Attention:  Eugene A. Di Monte, Esq.

 
 
If to Purchasers:
Innovative Food Holdings, Inc.

 
3845 Beck Blvd., Suite 805

 
Naples, Florida  34114

 
Tel. No.:  (239) 596-0204

 
Fax No.:  (239) 254-7900

 
Attention:  Mr. Sam Klepfish

 
 
with a copy to:
Feder Kaszovitz LLP

 
845 Third Avenue

 
New York, NY  10022

 
Tel. No.:  (212) 888-8200

 
Fax No.:  (212) 888-7776

 
Attention:  Howard I. Rhine, Esq.

 
Any of the addresses set forth above may be changed from time to time by written
notice (delivered in connection with this Section) from the party requesting the
change.
 
Such notices and other communications will be treated for all purposes of this
Agreement as being effective immediately if delivered personally or by facsimile
(with written confirmation of transmission) during normal business hours, or
five (5) days after mailing by certified mail, return receipt requested, first
class postage prepaid, or one (1) Business Day after deposit for next Business
Day delivery by a nationally recognized overnight delivery service.
 
 
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14.3 Amendments and Waivers.  The waiver, amendment or modification of any
provision of this Agreement or any right, power or remedy under this Agreement,
whether by agreement of the parties hereto or by custom, course of dealing or
trade practice, will not be effective unless in writing and signed by the party
or parties against whom enforcement of such waiver, amendment or modification is
sought.  Except as otherwise provided herein, no failure or delay by any party
hereto in exercising any right, power or remedy with respect to any of the
provisions of this Agreement will operate as a waiver of such provisions or any
other provisions.
 
14.4 Severability.  If any provision of this Agreement or the application of any
such provision is held to be prohibited or unenforceable in any jurisdiction,
such provision will, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability.  The remaining provisions of this
Agreement will remain in full force and effect, and any such prohibition or
unenforceability in any jurisdiction will not invalidate or render unenforceable
such provision in any other jurisdiction.  The parties hereto will use their
best efforts to replace the provision that is contrary to law with a legal one
approximating to the extent possible the original intent of the parties hereto.
 
14.5 Exhibits.  The schedules and exhibits that are attached to and referred to
herein are incorporated in and are an integral part of this Agreement.
 
14.6 Integration and Entire Agreement.  This Agreement and the Related Documents
set forth the entire understanding among the parties hereto with respect to the
subject matter hereof and thereof, supersede all previous and contemporaneous
written or oral negotiations, commitments, understandings, and agreements
relating to the subject matter hereof and thereof and merge all prior and
contemporaneous discussions between or among the parties hereto or any of their
respective Affiliates relating to the subject matter hereof or thereof.
 
14.7 Counterparts and Headings.  For the convenience of the parties hereto, this
Agreement may be executed in one or more counterparts, including by facsimile,
each of which will be deemed an original, but all of which together shall
constitute one and the same agreement.  This Agreement will become binding only
when counterparts hereto have been executed and delivered by all parties
hereto.  All headings and captions are inserted for convenience of reference
only and will not affect the meaning or interpretation of any provision in this
Agreement.
 
14.8 Survival.  All representations and warranties of Seller and Purchasers made
in this Agreement and the Related Documents, as well as the obligations of the
parties hereto to be performed following Closing, will survive the Closing for a
period of thirty six (36) months following the Closing Date; provided, however,
that (a) the representations and warranties contained in Sections 3.1, 3.2, 4.1,
4.2, 4.5 and 5.1 will survive without time limit, and (b) the representations,
warranties and covenants contained in Sections 4.11, 4.14, 4.18, 11.5 and 11.9
will survive until six (6) months after the expiration of the applicable
statutes of limitation relating to claims with respect thereto.  Notwithstanding
anything to the contrary contained herein, any covenant, representation or
warranty in respect of which indemnity may be sought under Article 13 shall
survive the time at which it would otherwise terminate pursuant to this
Section 14.8, if the Notice of Claim with respect to the inaccuracy or breach
giving rise to such right to indemnity shall have been given to the Indemnifying
Party prior to such time.  This Section 14.8 shall not limit any covenant or
agreement of the parties hereto which by its terms contemplates performance over
a period of time that exceeds thirty six (36) months after the Closing Date.
 
 
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14.9 Expenses.  Purchasers, jointly and severally, and Seller will each pay the
fees and expenses of their respective counsel, accountants and other experts
incident to the negotiation and preparation of this Agreement, the schedules and
exhibits hereto and the Related Documents.  Notwithstanding the foregoing
provisions of this Section 14.9, Seller shall pay all recording charges, if any,
associated with the transfer of the Real Property contemplated hereby.
 
14.10 Interpretations.  As used herein, the words “ordinary course” or “ordinary
course of business” means the ordinary course of commercial operations
customarily engaged in by the Company consistent with past practices and
specifically does not include (i) the incurrence of any material liability for
any tort or any breach of or default under any Contract or Law, (ii) the failure
to meet obligations of the Company as they become due or payable or (iii) any
actions or omissions by the Company taken or not taken in contemplation of the
marketing or sale of the Business, the Acquired Shares or the Assets or any part
thereof, or of any merger, consolidation, tender offer or other business
combination involving Company.  The qualification or limitation of any statement
made herein to a party’s “knowledge” or to a matter “known” to a party refers to
such party’s actual knowledge after reasonable inquiry.  As used herein
“including” shall be deemed to be followed by “without limitation” and shall not
be construed to limit any general statement that it follows to the specific or
similar items or matters immediately following it.  As used herein, words such
as “herein,” “hereinafter,” “hereof,” and “hereunder” refer to this Agreement as
a whole and not merely to a subdivision in which such words appear unless the
context otherwise requires.  Any reference in this Agreement to gender shall
include all genders, and words imparting the singular number only shall include
the plural and vice versa, unless the context otherwise requires.
 
14.11 Further Assurances.  Each party hereto shall execute and cause to be
delivered to each other party hereto such instruments, powers of attorney, and
other documents, and shall take such other actions, as such other party may
reasonably request (prior to, at or after the Closing) for the purpose of
carrying out or evidencing any of the transactions contemplated by this
Agreement.
 
14.12 Confidentiality.  Except as required by Law, the parties hereto shall
hold, and shall cause their respective officers and authorized representatives
and agents to hold, any non-public information obtained from the other parties
hereto in confidence to the extent required by, and in accordance with the
provisions of, that certain Confidentiality and Non Disclosure Agreement, dated
August 5, 2010 between Purchase and Company (the “Confidentiality
Agreement”).  Moreover, on and at all times after the Closing Date, Seller shall
keep confidential, and shall not use or disclose to any other Person, any
non-public document or other non-public information in his possession that
relates to the Business, the Assets or Purchaser.  Notwithstanding any other
express or implied agreement to the contrary, the parties hereto agree that each
of them and each of their employees, representatives and other agents may
disclose to any and all Persons, without limitation of any kind, the tax
treatment and tax structure of the transaction and all materials of any kind
(including opinions or other tax analyses) that are provided to any of them
relating to such tax treatment and tax structure, except where confidentiality
is reasonably necessary to comply with U.S. federal or state securities
laws.  For purposes of this paragraph, the terms “tax treatment” and “tax
structure” have the meanings specified in Treasury Regulation
section 1.6011-4(c).
 
14.13 Public Announcements.  Seller shall not issue, or permit any of its agents
or Affiliates to issue, any press releases or otherwise make, or permit any of
its agents or Affiliates to make, any public or other statements, with respect
to this Agreement, the Related Documents and the transactions contemplated
hereby and thereby without the prior written consent of Purchaser.
 
 
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14.14 Remedies Cumulative; Specific Performance.  Except as set forth in Article
13, the rights and remedies of the parties hereto shall be cumulative (and not
alternative).  The parties hereto agree that, in the event of any breach or
threatened breach by any party hereto of any covenant, obligation or other
provision set forth herein for the benefit of any other party hereto, such other
party shall be entitled (in addition to any other remedy that may be available
to it) to seek (a) a decree or order of specific performance or mandamus to
enforce the observance and performance of such covenant, obligation or other
provision, and (b) an injunction restraining such breach or threatened breach.
 
14.15 Drafting.  Each party hereto acknowledges that its legal counsel
participated in the preparation of this Agreement.  The parties hereto
stipulate, therefore, that the rule of construction that ambiguities are to be
resolved against the drafting party will not be employed in the interpretation
of this Agreement to favor any party against the other.
 
14.16 Governing Law.  This Agreement will be construed, governed and enforced in
accordance with the internal laws of the State of New York without regard to the
conflicts of law principles thereof.
 
14.17 JURISDICTION; WAIVER OF JURY TRIAL.  SUBJECT TO THE LIMITATIONS CONTAINED
IN SECTION 14.18, EACH OF THE PARTIES HERETO HEREBY (I) IRREVOCABLY CONSENTS AND
SUBMITS TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK IN CONNECTION WITH ANY PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY IF SUCH
PROCEEDING IS COMMENCED BY SELLER AND TO THE JURISDICTION OF THE UNITED STATES
DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS IF A PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY IF SUCH
PROCEDING IS COMMENCED BY PURCHASER  AND (II) WAIVES ANY OBJECTION TO SUCH
VENUE.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
 
14.18 Mandatory Arbitration.  Section 14.17 notwithstanding, all disputes
arising under this Agreement shall be resolved through arbitration as described
below and Section 14.17 is only applicable only to challenges to the arbitration
process and to enforce its determination.  Any dispute or controversy arising
out of or related to this Agreement or any breach hereof shall be settled by
binding arbitration by the American Arbitration Association (or any organization
successor thereto) in accordance with its Commercial Arbitration Rules then
prevailing.  The arbitration shall be held in front of one arbitrator who shall
allow limited discovery.  The losing party in the arbitration shall pay the
costs of the prevailing party, including reasonable attorney’s fees.  If the
arbitration is commenced by Seller it shall be held in New York County, New York
and if commenced by Purchaser it shall be held in Cook County, Illinois.
 
[Remainder of page intentionally left blank.  Signature page appears on next
page.]
 
 
 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first above written.
 
INNOVATIVE FOOD HOLDINGS, INC.
 
 
By:                                                                
Name: Sam Klepfish
Title: Chief Executive Officer
 
 
ARTISAN SPECIALTY FOODS, INC.
 
 
By:                                                                
Name: Sam Klepfish
Title: Chief Executive Officer
 
 

                                                                                                                                                                           
 DAVID VOHASKA
 
 
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