exv10w1






EXHIBIT 10.1




PHARMACY PURCHASE AGREEMENT




          THIS AGREEMENT is made effective the 2nd day of May, 2008, among APOTHECARYRX, LLC, an
Oklahoma limited liability company (the “Buyer”), PARKWAY DRUGS, INC., an Illinois corporation
(“Parkway”), REHN-HUERBINGER DRUG CO., an Illinois corporation (“RHD Co.”), 666 DRUG COMPANY, an
Illinois corporation (“Drug Co.”), WILMETTE-HUERBINGER DRUG CO., an Illinois corporation (“WHD Co.”
and collectively with Parkway, RHD Co. and Drug Co., the “Sellers”), EDWARD FOX, an individual
(“Fox”), SIMPSON GOLD, an individual (“Gold”), LAWRENCE HORWITZ, an individual (“Horwitz”), and
STEVEN FEINERMAN, an individual (“Feinerman” and together with Fox, Gold and Horwitz, collectively,
the “Shareholders”).



B A C K G R O U N D :



A. The Sellers own and operate the pharmacy businesses located in or near Glencoe, Illinois,
Wilmette, Illinois and Chicago, Illinois, described at Schedule “A” attached as a part hereof
(collectively, whether one or more, the “Business”).



B. Each Shareholder, or a trust for which such Shareholder is the trustee or settlor, owns an
interest in the Sellers as set forth in Exhibit “A” to the Goodwill Protection Agreement attached
hereto at Schedule “1.6.”



C. The Buyer desires to acquire and the Sellers desire to sell the Business by the Buyer acquiring
all assets, rights and properties owned by the Sellers which are used in or related to the
ownership, operation or maintenance of the Business, other than the Excluded Assets (as hereinafter
defined).




          NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
agree as follows:


1. Sale Agreement. Subject to the terms and conditions of this Agreement, the Buyer
agrees to purchase and the Sellers agree to sell all assets, rights and property used in or related
to the ownership, operation or maintenance of the Business as of the date of this Agreement and the
Closing Date (as hereafter defined) or as otherwise provided herein, except for the Excluded Assets
(collectively, the “Assets”). The Assets will be transferred by the Sellers to the Buyer on the
Closing Date free and clear of all liens, claims and encumbrances other than the Permitted Liens
(as hereinafter defined). The Assets include, without limitation:





	 	1.1.	 	Fixtures and Equipment. All tangible personal property other than
inventory, used in or related to the ownership, operation or maintenance of the
Business, including, without limitation, all equipment, furniture, trade fixtures and
the items listed at Schedule “1.1” attached as a part hereof.





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	 	1.2.	 	Merchandise Inventory. All of the following inventory and supplies
located on the premises of the Business at the Time of Transfer (the “Merchandise
Inventory”): (a) all saleable prescription pharmaceutical inventory except: (i)
inventory that is damaged, has expired or will expire within ninety (90) days following
the Time of Transfer (as hereinafter defined); (ii) non-wholesaler re-packed or
misbranded pharmaceutical merchandise; (iii) for each Business location, any
prescription drug that has had no sales in the year prior to the Time of Transfer that
is not accepted by the Buyer in the Buyer’s reasonable discretion; (iv) any other
inventory not transferable due to any applicable local, state or federal law (the items
in parts (i) through (iv) above are hereinafter referred to as the “Excluded Rx
Inventory”); and (v) inventory set aside for Will Call Prescriptions (as hereinafter
defined in paragraph 1.4); and (b) all other saleable merchandise.
	 
	 	1.3.	 	Contracts and Leases. All of the Sellers’ interest in the contracts,
leases and agreements listed at Schedule “1.3” (the “Assigned Contracts”) and all other
Contracts (as hereinafter defined in paragraph 6.1.4) that are acceptable to the Buyer.
	 
	 	1.4.	 	Will Call Receivables. The Will Call Receivables (as hereinafter
defined in paragraph 5.2).
	 
	 	1.5.	 	Intangible Property. Except for items in subparagraphs (b) or (e) in
this paragraph that are not assignable, all intangible personal property used in or
related to the ownership, operation, or maintenance of the Business, including, without
limitation: (a) the exclusive right to all names (including the names “Parkway Drugs”
and “Parkway Drugs, Inc.”), telephone numbers, pager numbers, cellular and digital
phone numbers, internet web sites and electronic mail addresses, if any (the Sellers
represent that the Sellers own one website that is incomplete and not functioning); (b)
all permits, licenses, certificates and operating authorities necessary to operate the
Business, to the extent assignable; (c) all customer and prospective customer lists
including the exclusive use of such lists; (d) all books, records and files, whether
physical or electronic (other than corporate records and minutebooks not used in the
Business; and (e) all computer software, to the extent assignable.
	 
	 	1.6.	 	Going Concern Assets. The covenant not to compete and other going
concern assets as set forth in the Goodwill Protection Agreement in substantially the
form attached at Schedule “1.6” as a part hereof (the “Goodwill Protection Agreement”).




2. Excluded Assets. Notwithstanding anything to the contrary herein, the Assets exclude
all of the following (the “Excluded Assets”): (a) all of the Sellers’ cash, certificates of
deposit, checks and coupons, except for a cash change fund in the amount of $500.00 for each
pharmacy location (the “Change Fund”); (b) all accounts receivable, relating to operation of the
Business prior to the Time of Transfer other than the Will Call Receivables; (c) those items
described at Schedule “2” attached as a part hereof that the Sellers and the Shareholders represent
are not




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necessary for the ownership or operation of the Business; (d) the Excluded Inventory; and (e) all
life insurance policies.



3. Liabilities. The Sellers will be solely responsible for and will pay or otherwise
satisfy on or before the Closing Date all of the following that could create a lien against any of
the Assets except for the liens listed at Schedule “3” attached as a part hereof (the “Permitted
Liens”): (a) liabilities, obligations and debts of the Sellers with respect to the Business in
existence as of the Closing Date; and (b) taxes (including sales and income taxes) accruing from
operation of the Business or actions taken by the Sellers prior to and through the Closing Date.
The Sellers will remain liable for and promptly pay after the Closing Date the obligations creating
the Permitted Liens. The amount of the obligations under the Permitted Liens will be calculated
(or estimated if calculation is not possible) on or before the Closing Date and if such amount
exceeds $50,000.00, such amount will be paid into escrow from the funds due under paragraph 4.1 to
secure the release of the Permitted Liens pursuant to an escrow agreement reasonably acceptable to
all parties.



4. Purchase Price. Subject to the adjustments and prorations hereafter described, the
total purchase price to be paid by the Buyer to the Sellers for the purchase of the Business is the
amount equal to the sum of (the “Purchase Price”): (a) Five Million Dollars ($5,000,000.00) (the
“Base Price”); plus (b) the Merchandise Inventory Price (as hereafter defined) calculated in
accordance with paragraph 5 of this Agreement; plus (c) the total amount of the Will Call
Receivables. The Purchase Price will be adjusted and paid as follows:





	 	4.1.	 	Cash at Closing. On the effective date of this Agreement, the Buyer
will deposit One Hundred Thousand Dollars ($100,000.00) with Chicago Title Insurance
Co. located at 171 North Clark Street, Chicago, Illinois, 60601-3294, as earnest money
(the “Earnest Money”), and the Earnest Money will be applied towards the Purchase Price
on the Closing Date. The parties agree that the Earnest Money will become
non-refundable in the event that the Buyer discusses any aspect of the transaction
contemplated by this Agreement with any of the Sellers’ vendors or suppliers, or any
employee of the Sellers other than the Shareholders, except as provided for under the
terms of this Agreement. On the Closing Date, the Buyer will pay to RHD Co., as
disbursement agent for the Sellers in immediately available funds, as adjusted under
paragraphs 4.3 and 4.4: (a) Three Million Four Hundred Thousand Dollars
($3,400,000.00); (b) all of the Merchandise Inventory Price; and (c) all of the amount
of the Will Call Receivables.
	 
	 	4.2.	 	Seller Financing; Goodwill Protection. To satisfy the balance of the
Purchase Price, on the Closing Date, the Buyer will: (a) execute and deliver a
promissory note (the “Promissory Note”) in the amount equal to One Million Four Hundred
Thousand Dollars ($1,400,000.00) in favor of RHD Co.; and (b) enter into the Goodwill
Protection Agreement providing for payment of One Hundred Thousand Dollars
($100,000.00) in the aggregate to Fox, Gold, Horwitz and Feinerman as set forth
therein. The Promissory Note will be secured by a security agreement (the “Security
Agreement” and collectively with the Promissory Note, the “Financing Documents”), bear
interest at 4.31% per annum, be payable in blended installments of principal and
interest with the first payment of Five





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	 	 	 	Hundred Seven Thousand Four hundred Fifty-Nine Dollars ($507,459.00) due on the
first anniversary of the Promissory Note and thereafter in eight (8) equal quarterly
blended installments of principal and interest each in the amount of $124,958,
subject to the terms of the Promissory Note. The Financing Documents will be in
substantially the form set forth at Schedule “4.2” attached as a part hereof.
	 
	 	4.3.	 	Adjustments. On the Closing Date, the amount to be paid pursuant to
paragraph 4.1 will be increased by the amount of the Change Fund which is actually
delivered to the Buyer.
	 
	 	4.4.	 	Prorations. On the Closing Date, the amount to be paid pursuant to
paragraph 4.1 will be adjusted based on the proration of all rents (including ad
valorem taxes and casualty insurance), if any, and utilities for the month in which the
Time of Transfer occurs through the Time of Transfer (the “Prorations”). All accounts
payable and other liabilities incurred prior to the Time of Transfer will be the sole
responsibility of the Sellers. All accounts payable and other liabilities incurred by
the Buyer in connection with the Business on and after the Time of Transfer will be the
sole responsibility of the Buyer. All accounts receivable arising prior to the Time of
Transfer will remain the exclusive property of the respective Sellers, as will the
proceeds thereof. Each party shall, promptly upon receipt, deliver to the other party
copies of each relevant invoice, bill or statement that may be in such party’s records.
	 
	 	4.5.	 	Allocation. The Purchase Price will be allocated among the Assets as
set forth at Schedule “4.5” attached as a part hereof.




5. Inventory. The Merchandise Inventory and the Will Call Receivables will be accounted
for as follows:





	 	5.1.	 	Physical Inventory. At times agreeable to the parties prior to the
Closing Date, a physical inventory (the “Physical Inventory”) will be taken of all
Merchandise Inventory and supplies located at the Business. A separate Physical
Inventory will be conducted at each of the four business locations over four
consecutive days with no more than one location inventoried per day. The Physical
Inventory will be certified and taken by Progressive Inventory Service (“Progressive”),
provided that if Progressive cannot or will not agree in writing within three (3)
business days prior to the date the Physical Inventory is scheduled that Progressive
will furnish in writing values for the Merchandise Inventory broken down by section and
by shelf immediately following completion of the Physical Inventory, then the Physical
Inventory will be conducted by another national inventory service selected mutually by
the Buyer and the Sellers. The Buyer will pay one-half of the cost of the Physical
Inventory and the Sellers will pay one-half of the cost of the Physical Inventory. The
Physical Inventory will be recorded on duplicate inventory sheets in the presence of
the Sellers and the Buyer or their representatives, and a copy of such inventory sheets
will be furnished to the Sellers and the Buyer upon completion of the Physical
Inventory. All Excluded





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	 	 	 	Rx Inventory or other merchandise that is not saleable (together, the “Excluded
Inventory”) will be excluded from the Physical Inventory and set aside. The Sellers
will have the right to remove all Excluded Inventory from the Business within five
(5) business days and to return the Excluded Inventory to Vendors or send it to a
reclamation center for processing. Any Excluded Inventory not timely removed from
the Business by the Sellers will be deemed abandoned and the Buyer may dispose of
the Excluded Inventory as the Buyer deems appropriate and all proceeds from such
disposition will belong to the Buyer. The purchase price for the Merchandise
Inventory (the “Merchandise Inventory Price”) will be: (a) the actual cost paid by
the Sellers for each item listed in the Physical Inventory after all discounts and
rebates received or to be received by the Sellers are applied; plus (b) the actual
cost to the Sellers of all additional Merchandise Inventory received at each
Business location after the completion of the Physical Inventory at such location
and prior to the Time of Transfer, minus (c) the actual cost to the Sellers of all
additional Merchandise Inventory sold at each Business location after the completion
of the Physical Inventory at such location and prior to the Time of Transfer. The
parties anticipate that the amount of the Merchandise Inventory Price will be
approximately $2,500,000.00.
	 
	 	5.2.	 	Will Call Prescriptions. Progressive will, during the Physical
Inventory, separately account for all orders at the Business for prescriptions placed
but not paid for prior to the Time of Transfer (“Will Call Prescriptions”) and
determine the cash amount owed by customers for Will Call Prescriptions (the “Will Call
Receivables”) as of the Time of Transfer.




6. Representations and Warranties. The parties represent and warrant to each other as
follows:





	 	6.1.	 	Sellers’ and Shareholders Representations and Warranties. As an
inducement to the Buyer to enter into this Agreement, the Sellers and the Shareholders
represent and warrant to the Buyer that as of the date of this Agreement and the
Closing Date:






	 	6.1.1.	 	Financial Statements. The Sellers have delivered to the Buyer the
unaudited financial statements for the Business for the periods ending December
31, 2005, December 31, 2006, December 31, 2007 and February 29, 2008. To the
knowledge of the Sellers, there has not been a material change (nor an event
which would result in any material change) in the Business, or in the results
of operation or financial condition of all of the Sellers taken as a whole
since February 29, 2008. The financial statements, copies of which are
attached at Schedule “6.1.1” as a part hereof, consist of a balance sheet and
an income statement without notes and other disclosures. The financial
statements and income statements are true and correct in all material respects
and consistently present fairly the financial condition and results of
operations of the Business at the dates thereof and for the respective periods
then ended.





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	 	6.1.2.	 	Absence of Liabilities. Except for the obligations creating
Permitted Liens, obligations under contracts, whether or not assignable, and
liabilities, obligations and commitments that are not material and do not
create a lien on any of the Assets, the Sellers currently have no debt,
liability, obligation or commitment, absolute or contingent, known or unknown,
relating to or connected with the Business or the Assets other than: (a) those
set forth (and not exceeding the amounts so set forth) in the most recent
financial statements attached at Schedule “6.1.1” (the “Current Financial
Statements”) and not otherwise paid or discharged after the date thereof; (b)
and those incurred in the ordinary course of business from the effective date
of the Current Financial Statements, through the date of this Agreement or the
Closing Date, as the case may be, consistent with past practices. On the
Closing Date, the Business will have no claims, debts, liabilities,
obligations, guaranties or commitments that will or could create a lien or
claim against any of the Assets or the Buyer, except for obligations creating
the Permitted Liens. The Assets will not be subject to or liable for any
claim, debt, liability, obligation, guaranty or commitment immediately after
the Closing Date, other than Permitted Liens and those created by the Buyer.
Any such claim, debt, liability, obligation, guaranty or commitment upon the
Assets existing on the Closing Date will be the sole responsibility of the
Sellers, and the Sellers and the Shareholders hereby agree to indemnify and
hold harmless the Buyer from the amount of any such claim, debt, liability,
obligation, guaranty or commitment affecting the Assets existing as of the
Closing Date. Further, the Sellers will discharge all obligations under the
Contracts required by the terms of such Contracts to be discharged prior to the
Time of Transfer.
	 
	 	6.1.3.	 	Title to Assets. The Sellers own, possess and have good and
marketable title to the Assets free and clear of all mortgages, liens, leases,
pledges, charges, encumbrances, equities, easements, rights of way, covenants,
conditions, restrictions or claims of every nature and kind whatsoever, other
than the Permitted Liens and those described at Schedule “6.1.3.” The Assets
constitute all the assets used in the Business or necessary for the operation
of the Business as currently operated. To the knowledge of the Seller, the
Merchandise Inventory is in good saleable condition. All of the Assets that
are tangible personal property are, to the knowledge of the Sellers, in good
operating condition and repair, and in sound structural condition, reasonable
wear and tear excepted.
	 
	 	6.1.4.	 	Contracts. Schedule “6.1.4” is a true, correct and complete list (or
description, in the case of oral agreements) of all of the contracts, leases
and agreements used in or affecting the Business (the “Contracts”). Except as
expressly disclosed to the Buyer in Schedule “6.1.4”: (a) to the knowledge of
the Sellers, the Contracts are in full force and effect; (b) the Sellers are in
full compliance with all of the Sellers’ obligations and are not in default
under the Contracts; (c) to the knowledge of the Sellers, the





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	 	 	 	counterparty under each of the Contracts is in full compliance with all of
such party’s obligations under the Contracts; (d) to the knowledge of the
Sellers, no default exists under any of the Contracts; (e) to the knowledge
of the Sellers, no event of default or event which would become an event of
default with the giving of notice or passage of time has occurred; and (f)
to the knowledge of the Sellers, no condition presently exists which would
give any party to any contract the right to terminate such contract. There
are no other material contracts, leases, commitments or agreements in effect
related to the Assets or the Business other than those identified at
Schedule “6.1.4.”
	 
	 	6.1.5.	 	Legal Requirements. To the knowledge of the Sellers, each Seller:
(a) has all requisite power to own, lease and operate such Seller’s properties,
including, without limitation, the Assets of such Seller and to carry on such
Seller’s business as now being conducted; (b) is duly qualified to carry on
such Seller’s business in the State of Illinois; and (c) holds all required
licenses and permits for carrying on all aspects of such Seller’s business.
The Sellers have complied and will continue to comply with all applicable
federal, state or local statutes, laws and regulations including, without
limitation, any applicable building, zoning or other law, ordinance or
regulation affecting the operation of the Business.
	 
	 	6.1.6.	 	Zoning. To the knowledge of the Sellers, the zoning and any
applicable variances affecting the real property where the Business is located
permit the presently existing improvements and the continuation of the Business
as presently being conducted. To the knowledge of the Sellers, neither the
Sellers nor the Shareholders have received any notice of any and there are no:
(a) pending changes in statutes, regulations or local laws (including zoning)
that will render any part of the Business illegal; (b) outstanding orders or
notices pending from any local authority, governmental body or governmental
agency with respect to the Assets or the Business; or (c) plans, studies or
efforts by any governmental authority or agency or of any non-governmental
person or entity which in any way would materially affect all or any portion of
the Business or the Assets.
	 
	 	6.1.7.	 	Insurance. The Sellers have and will maintain in full force and
effect through the Closing Date their respective insurance coverages existing
on the date of this Agreement.
	 
	 	6.1.8.	 	Environmental Issues. The Sellers have not, and to the knowledge of
the Sellers no other party has, disposed, deposited, discharged, placed or
otherwise caused any release of any hazardous or toxic materials, substances,
pollutants, contaminants or wastes at, on or near the real property and
improvements where each Business is located in contravention of any applicable
federal, state or local laws, rules or regulations.





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	 	6.1.9.	 	Consents and Approvals. Except as set forth at Schedule “6.1.9”
attached as a part hereof, the execution, delivery, performance and
consummation of this Agreement does not and will not: (a) violate, conflict
with or constitute a default or an event that, with notice or lapse of time or
both, would be a default, breach or violation under any term or provision of
any instrument, agreement, contract, commitment, license, promissory note,
conditional sales contract, indenture, mortgage, deed of trust, lease or other
agreement, instrument or arrangement to which any of the Sellers is a party or
by which any Seller, the Business or the Assets are bound; (b) violate,
conflict or constitute a breach of any statute, regulation or judicial or
administrative order, award, judgment or decree to which any Seller is a party
or to which any Seller, the Assets or the Business are bound or subject; or (c)
result in the creation or imposition of any adverse claim or interest, or any
lien, encumbrance, charge, equity or restriction of any nature whatever, upon
or affecting any Seller, the Business or the Assets.
	 
	 	6.1.10.	 	Litigation. Except as set forth at Schedule “6.1.10,” there is no:
(a) action, suit or proceeding pending, or to the knowledge of the Sellers
threatened, against any of the Sellers, the Assets or the Business; or (b)
proceeding, investigation, charges, audit or inquiry pending, or to the
knowledge of the Sellers threatened, before or by any federal, state, municipal
or other governmental court, department, commission, board, bureau, agency or
instrumentality which could reasonably be expected to result in an adverse
effect on any of the Sellers, the Business or the Assets.
	 
	 	6.1.11.	 	Certain Employee Plans. Except as set forth at Schedule “6.1.11,”
the Sellers: (a) have no “employee benefit plans,” as defined in the Employee
Retirement Security Act of 1974, as amended, including by way of example and
not limitation, 401(k), Keogh, SEP and health insurance plans; and (b) are not
a party to any multi-employer plan. Other than at-will employment agreements,
there are no oral or written employment or compensation agreements with any
officers, directors, employees, retired employees or former employees of any
Seller.
	 
	 	6.1.12.	 	Computer Systems. All computer software which is used in connection
with the operation of the Business is either proprietary or held pursuant to a
valid, legal and binding license agreement which is in full force and effect,
and to the knowledge of the Sellers no event has occurred which would
constitute an event of default under any applicable agreement or which, with
the lapse of time, the giving of notice or both, would constitute an event of
default under any applicable agreement. To the knowledge of the Sellers, other
than written industry standard license agreements, each such program or system
is complete and is not subject to any lien, claim, encumbrance, security
interest, right, restriction, option or purchase obligation held by any person.





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	 	6.1.13.	 	Taxes. All tax returns and reports of each of the Sellers required
by law to be filed have been filed or valid extensions have been obtained. The
returns which have been filed are, to the knowledge of the Sellers, true and
correct in all material respects and all taxes shown as due thereon have been
paid. All taxes and other governmental charges which are due and payable have
been paid and recorded in the appropriate accounting records. There is no
pending, or to the knowledge of the Sellers threatened, claim against any of
the Sellers for payment of additional taxes in excess of the amounts reflected
on such party’s books and financial statements. None of the Sellers has
executed any waiver of any statute of limitations against assessments of taxes.
	 
	 	6.1.14.	 	Authority. The Sellers and the Shareholders have taken, or will
take prior to or on the Closing Date, all necessary action to authorize the
execution, delivery and performance of this Agreement and have adequate power,
authority and legal right to enter into, execute, deliver and perform this
Agreement and to consummate the transactions contemplated hereby. This
Agreement is legal, valid and binding with respect to each Seller and
Shareholder and is enforceable in accordance with its terms, except to the
extent that enforceability may be limited by bankruptcy, moratorium,
reorganization and other laws affecting the enforcement of creditors’ rights
generally and by general principles of equity. On execution, delivery and
performance of this Agreement, including, without limitation, the completion of
closing and payment of the Purchase Price, in accordance with its terms, the
Buyer will own the Assets free of all claims, liens, encumbrances and
liabilities, except for Permitted Liens.
	 
	 	6.1.15.	 	Labor Relations. The Sellers and the Business have not and are not
now a party to any collective bargaining or other labor contract. To the
knowledge of the Sellers, except as set forth at Schedule “6.1.15,” there has
not been, there is not presently or existing and there has not been any threat
of: (a) any strike, slow down, picketing, work stoppage or employee grievance
process; (b) any proceeding against or affecting any of the Business relating
to the alleged violation of any federal, state, local, municipal, foreign,
international, multinational or other administrative order, constitution, law,
ordinance, principle of common law, regulation, statute or treaty pertaining to
labor relations or employment matters, including any charge or complaint filed
by an employee or union with the National Labor Relations Board, the Equal
Employment Opportunity Commission, or any comparable governmental body,
organizational activity, or other labor employment dispute against or affecting
any of the Business, their premises or the Assets; or (c) any application for
certification of a collective bargaining agent. To the knowledge of the
Sellers, no event has occurred or circumstances exist that could provide the
basis for any work stoppage or other labor dispute. There is no lock out of
any employees of any of the Sellers, and no such action is contemplated by any
of the Sellers. The Sellers and the Business have





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	 	 	 	complied in all respects with all legal requirements relating to the
employment, equal employment opportunity, non-discrimination, immigration,
wages, hours, benefits, collective bargaining, the payment of social
security and similar taxes, occupational safety and health and plant
closings. Neither the Sellers nor the Business is liable for the payment of
any compensation, damages, taxes, fines, penalties or other amounts, however
designated, for failure to comply with any of the foregoing.
	 
	 	6.1.16.	 	Full Disclosure. This Agreement, any schedule referenced in or
attached to this Agreement, any document furnished to the Buyer under this
Agreement or any certification furnished to the Buyer under this Agreement does
not contain any untrue statement of a material fact and does not omit to state
a material fact necessary to make such statement, in the circumstances under
which it was made, not misleading. All of the representations, warranties and
covenants in this Agreement: (a) are true and correct as of the date made; (b)
will be true and correct (or will be supplemented in writing to make them true
and correct) as of the Closing Date; and (c) will not be waived, discharged,
released, modified, terminated or affected by any due diligence by the Buyer.
For purposes of this Agreement, when a statement is qualified by the phrase “to
the knowledge of the Sellers,” such phrase means: (y) the actual knowledge of
any of the Sellers or the Shareholders; and (z) the knowledge which any of the
Sellers or Shareholders, in the exercise of reasonable diligence, would obtain.






	 	6.2.	 	By Buyer. As an inducement to the Sellers and Shareholders to enter
into this Agreement, the Buyer hereby represents and warrants to the Sellers and the
Shareholders that as of the date of this Agreement and the Closing Date:






6.2.1. Organization. Buyer is a limited liability company, duly organized,
validly existing and in good standing under the Laws of the State of Oklahoma.




6.2.2. Authorization. Buyer has requisite power and authority to execute
and deliver this Agreement and consummate the transactions contemplated hereby. The
execution and delivery of this Agreement and the other agreements and documents
referenced herein and the consummation of the transactions contemplated hereby and
thereby have been duly and validly authorized by the managers of Buyer, and no other
proceeding on the part of Buyer is necessary to authorize the execution, delivery
and performance of this Agreement or the other agreements and documents referenced
herein or the consummation of the transactions contemplated hereby or thereby. This
Agreement has been, and such other agreements and documents will be, duly executed
and delivered by Buyer and, assuming the valid execution and delivery by all
counterparties thereto, will constitute, a valid and binding agreement of Buyer
enforceable against Buyer in accordance with its terms, except to the extent that
enforceability may be limited by bankruptcy, moratorium, reorganization and other
laws affecting the enforcement of creditors’ rights generally and by general
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6.2.3. Consents and Approvals; No Violations; Governmental Filings. Neither
the execution, delivery or performance of this Agreement and the agreements and
documents referenced herein nor the consummation by Buyer of the transactions
contemplated hereby or thereby will (i) conflict with or result in any breach or
violation of any provision of the charter, articles of organization, operating
agreement or bylaws of Buyer, (ii) violate, conflict with or result in a default (or
any event which, with notice or lapse of time or both, would constitute a default)
under, or result in any termination, cancellation or acceleration, or give rise to
any such right of termination, cancellation or acceleration under, any of the terms,
conditions or provisions of any note, mortgage, other evidence of indebtedness,
guarantee, license, agreement, lease or other instrument or obligation to which
Buyer is a party or by which Buyer or any of its assets is subject or by which any
of them may be bound, (iii) violate any order, injunction, decree, statute, rule or
regulation applicable to Buyer or (iv) result in the creation or imposition of any
lien upon any properties, assets or business of Buyer, other than liens in favor of
the Buyer’s lenders.




6.2.4. Financial Statements. The Buyer has delivered to the Sellers and
Shareholders the most current audited financial statements of Buyer for the period
ending December 31, 2007. To the knowledge of Buyer, there has not been any
material adverse change (nor an event which would result in a material adverse
change) in the Buyer or its business, or as a result of the operation of the Buyer
since December 31, 2007. The financial statements of Buyer, copies of which have
been delivered to the Sellers, consist of a balance sheet, an income statement along
with notes and disclosures thereto. Such financial statements are true and correct
in all material respects, and have been prepared in accordance with generally
accepted accounting principles.




6.2.5. Full Disclosure. This Agreement, any schedule referenced in or
attached to this Agreement, any document furnished to the Sellers or the
Shareholders under this Agreement or any certification furnished to the Sellers and
the Shareholders under this Agreement do not contain any untrue statement of a
material fact and do not omit to state a material fact necessary to make such
statement, in the circumstances under which it was made, not misleading. All of the
representations, warranties and covenants of Buyer in this Agreement: (a) are true
and correct as of the date made; (b) will be true and correct as of the Closing
Date; and (c) will not be waived, discharged, released, modified, terminated or
affected by any due diligence by the Sellers or the Shareholders on the Buyer. For
purposes of this Agreement, when a statement is qualified by the phrase “to the
knowledge of the Buyer,” such phrase means: (y) the actual knowledge of the
officers of the Buyer; and (z) the knowledge which any of the officers of the Buyer,
in the exercise of reasonable diligence, could obtain.


7. Covenants. The parties agree to perform the following prior to the Closing Date, unless
time for performance is clearly indicated to be after the Closing Date:




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	 	7.1.	 	Access to Information. During the period commencing on the date of
this Agreement and ending on the Closing Date, the Sellers and the Shareholders will
cause the officers, accountants and lawyers of the Business, to afford the Buyer and
the persons expected to enter into financing agreements with respect to the Buyer’s
acquisition and the authorized representatives of the foregoing, full access during
normal business hours to the books, records, accountants and lawyers of the Business
and the Sellers to make such investigation as the Buyer desires regarding the Business,
the Assets and the Sellers. The Sellers will furnish such financial, operating data,
information and responses as the Buyer might reasonably request. The Sellers will
furnish financial statements for the Business for the month of March, 2008, as soon as
such statements are prepared, but in no event later than three (3) business days prior
to the Closing Date, and for the time period from April 1, 2008, through the Time of
Transfer as soon as such statements are prepared. The Buyer will not meet or engage in
contact with the employees of the Sellers (other than the Shareholders) until after the
Buyer’s financing arrangements are complete and then such meeting will occur three (3)
business days prior to the Closing Date at the Business at the reasonable times
designated by the Sellers. Notwithstanding the foregoing, the Buyer shall inspect such
books, records and Assets in a confidential manner at time and locations approved by
Sellers, which may be outside of business hours of the Sellers.
	 
	 	7.2.	 	Conduct of Business. Prior to the Closing Date or the termination of
this Agreement, each Seller will operate such Seller’s Business in a businesslike
manner in accordance with such Seller’s prior practices and will use such Seller’s
commercially reasonable efforts to maintain and preserve such Seller’s Business, the
goodwill of all customers and good relations with its employees. In addition, unless
the Buyer otherwise consents in writing (which consent will not be unreasonably
withheld):






	 	7.2.1.	 	The Sellers will not: (a) transfer, sell, mortgage, pledge, encumber or
dispose of any of the Assets (other than the Merchandise Inventory) except to
unaffiliated third parties in the ordinary course of business for fair
consideration in an amount not less than the book value of such asset as
reflected in the Current Financial Statements; (b) transfer, sell, mortgage,
pledge, encumber or dispose of the Merchandise Inventory except at retail in
the ordinary course of business; (c) make or permit any amendment or
termination of any material contract, agreement, lease or commitment to which
any of the Sellers may be bound; (d) make any capital expenditures or commit to
make any capital expenditure or perform unfulfilled commitments to make capital
expenditures, whenever made or entered into, if such capital expenditures are
in excess of $5,000.00; or (e) incur any material amount of new indebtedness
for borrowed money or other obligations.
	 
	 	7.2.2.	 	Except in the ordinary course of business, none of the Sellers will enter
into any new employment agreement, amend or extend any existing employment
agreement, grant any severance pay, termination pay or





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	 	 	 	increases in compensation, take any action to vest any overfunded benefits
in any benefit plan or adopt or amend any bonus, profit sharing, pension,
stock option or similar plan, trust or other arrangement.
	 
	 	7.2.3.	 	The Sellers will not enter into any new labor or collective bargaining
agreement or amend or extend any existing labor or collective bargaining
agreement.
	 
	 	7.2.4.	 	The Sellers will not enter into any new supply agreement with any supplier of
any of the Merchandise Inventory or amend or extend any existing supply
agreement.
	 
	 	7.2.5.	 	The Sellers will not enter into any agreement, arrangement or understanding
involving the sale, transfer, assignment or other disposition of, or grant a
security interest in or optional rights to purchase or otherwise acquire the
Assets or the Business.
	 
	 	7.2.6.	 	The Sellers will not, and will cause each of the Sellers’ representatives and
affiliates not to, directly or indirectly, solicit, initiate or encourage any
inquiries or proposals from, discuss or negotiate with, provide any non-public
information to, or consider the merits of any unsolicited inquiries or
proposals from any person other than the Buyer relating to any transaction
involving the sale of the Business or the Assets, or any merger, consolidation,
business combination or similar transaction involving the Business.
	 
	 	7.2.7.	 	The Sellers will not increase regular (non “sale”) prices of any of the
merchandise offered for sale at the Business except as a direct result of an
increase in the Sellers’ cost of such merchandise and in the ordinary course of
business.






	 	7.3.	 	Consents. The Sellers will reasonably cooperate with the Buyer to
obtain, all licenses, permits, consents, approvals, authorizations, qualifications and
orders of governmental authorities and parties to contracts with the Sellers as are
necessary for the consummation of the transactions contemplated by this Agreement.
However, no contract will be amended to increase the amount payable thereunder and no
burden to the Buyer or the Sellers (without the Sellers’ consent) will be increased to
obtain any consent, approval or authorization.
	 
	 	7.4.	 	Employment. On the Closing Date, Fox, Gold, Horwitz and Feinerman will
enter into employment agreements with the Buyer or its affiliates (the “Employment
Agreements”) in substantially the forms attached at Schedule “7.4.” The Sellers will
terminate all employees of the Business effective as of the Time of Transfer and be
responsible for all claims by employees arising prior to the Time of Transfer,
including, without limitation, compensation, accrued vacation, earned holiday pay, paid
time off, severance pay, termination pay, worker’s compensation, wrongful termination,
discrimination or harrassment. On the





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	 	 	 	Closing Date, the Buyer will have the right, but not the obligation, to offer to
employ those employees of the Business determined by the Buyer in the Buyer’s sole
discretion (other than the employees entering into the Employment Agreements). The
terms of employment for each such retained employee will be determined by the Buyer.
Following the Closing Date, the performance of each employee who continues
employment with the Buyer will be evaluated periodically by the Buyer using such
criteria as may be established from time to time by the Buyer. Each Seller agrees
to encourage the employees of such Seller selected by the Buyer to continue their
association with the Business, without additional expense to the Sellers.






	 	7.5.	 	Leases. The Sellers and the Shareholders will use commercially
reasonable efforts to cause the landlord under each of the leases where the Business is
located (together whether one or more, the “Lease”) to assign each Lease to the Buyer.
	 
	 	7.6.	 	Sellers’ Insurance. Each Seller will maintain such Seller’s current
insurance coverages on the Business through the Closing Date.
	 
	 	7.7.	 	Conditions. The Sellers and the Shareholders will use commercially
reasonable efforts to cause the conditions in paragraph 8 to be satisfied. The Buyer
will use commercially reasonable efforts to cause the conditions in paragraph 9 to be
satisfied.
	 
	 	7.8.	 	Sales Tax Report. The Sellers will timely file any sales tax report
required to be filed with Illinois tax authorities in connection with the consummation
of this transaction.
	 
	 	7.9.	 	Business Transition. As soon as practicable after the Closing Date,
the Buyer will apply for applicable state pharmacy and DEA licenses along with any
other permits or licenses required by state or local regulations, and obtain agreements
with third party payers necessary to collect reimbursement for prescriptions dispensed
and associated fees. On the Closing Date, the Sellers, the Shareholders and the Buyer
will enter into a Transition Agreement in the form attached at Schedule “7.9” (the
“Transition Agreement”), regarding the Sellers’ management of the Business under the
Sellers’ permits and licenses after the Time of Transfer until the Buyer obtains all
necessary permits and licenses as therein provided.
	 
	 	7.10.	 	Collection of Accounts Receivable. All notes and accounts receivable
generated by the Business prior to the Time of Transfer (including trade accounts
receivable arising out of, and all monies due in respect to, merchandise inventory or
services sold by the Sellers prior to the Time of Transfer or accounts receivable of
the Sellers from their suppliers) shall remain the property of the Sellers and are not
purchased and sold hereunder (such notes and accounts receivable of the Sellers being
hereinafter referred to as “Seller Receivables”). All notes and accounts receivable
generated by the Business after the Time of Transfer (the “Buyer Receivables”) will be
the property of the Buyer. The Buyer Receivables and the Seller Receivables will
hereinafter be collectively referred to as the





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	 	 	 	“Receivables.” For the first 45 days after the Closing Date, the Sellers will
collect all Receivables that are third party insurance payments and for the first 60
days after the Closing Date, the Sellers will collect all Receivables paid by
individuals for house accounts. After such time periods, the Buyer will collect the
Receivables. The party collecting the Receivables (the “Collector”) will handle the
Receivables as follows:






	 	7.10.1.	 	In order to facilitate the collection and disbursement of Receivables, an
aged list of the Seller Receivables will be provided to the Buyer on the
Closing Date.
	 
	 	7.10.2.	 	Amounts received by the Collector in payment of Receivables will be paid by
the Collector as follows:






	 	(a)	 	Payments received for a designated Receivable
will applied to such Receivable. Amounts received by the Collector
from a customer or supplier, who has not paid a Seller Receivable and
who owes an amount under a Buyer Receivable, which amount is an open
account or is not designated as being in payment of a particular
invoice, will be applied first to the payment of Seller Receivables
that are aged less than sixty (60) days, then to the payment of Buyer
Receivables, then to the payment of Seller Receivables aged more than
sixty (60) days.
	 
	 	(b)	 	Amounts received by the Collector in payment of
Receivables shall be deposited by the Collector in its bank account.
The Collector will keep open records reviewable by all other parties at
anytime of the receipt and disbursement of Receivables. On each and
every Tuesday subsequent to the Closing Date, the Collector will remit
to the appropriate party at the addresses set forth herein or such
other address designated in writing, payment in an amount equal to the
amounts deposited during the previous week which were in payment of
Receivables applicable to such party and which were deposited in the
Collector’s bank account during the week ended the preceding Friday.
The Collector agrees to deposit items received for Receivables as soon
as reasonably possible. If any check received by the Collector in
payment of a Receivable is not honored by the bank on which it was
drawn, the Collector will notify the appropriate party and provide
relevant bank documentation.






	 	7.10.3.	 	The Collector will deliver to the other parties, by the tenth (10th) day of
each calendar month after the Closing Date in which the Collector receives
payment of Receivables, a list of the amounts received by the Collector in
payment of Receivables during the month preceding the month in which such list
is delivered.





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	 	7.10.4.	 	The Sellers may take such steps, as the Sellers, in their reasonable
discretion, deem advisable to collect the Seller Receivables, including, but
not limited to, telephone calls, statements of overdue amounts and the
institution of legal action against any customer or supplier which has not paid
a Seller Receivable when due. Notwithstanding the foregoing, the Sellers agree
to give the Buyer written notice three (3) business days prior to filing a
lawsuit against any customer of the Business, provided that such delay will not
cause harm to the Sellers. If delay will harm the Sellers, the Sellers may
proceed against a customer without delay, but will thereafter give prompt
notice of such action to the Buyer.
	 
	 	7.10.5.	 	Until the Seller Receivables have been paid in full, the Buyer will provide
one representative of the Sellers access, during business hours, to the books
of the Buyer pertaining to the collection of Seller Receivables.
	 
	 	7.10.6.	 	No charge will be made or be due by either the Buyer or Sellers for services
rendered under this Section 7.10.
	 
	 	7.10.7.	 	The Buyer will inform the appropriate Sellers on a monthly basis in the
event that any Will Call Prescription is cancelled or refused by any client or
customer, and the Buyer will then pay to such Seller the value of such
pharmaceutical inventory retained by the Buyer, net of the value of the Will
Call Receivable previously paid by the Buyer to the Sellers for such Will Call
Prescription.
	 
	 	7.10.8.	 	If any party receives payment of a Receivable that belongs to another party,
the receiving party will promptly remit payment of the Receivable to the
appropriate Collector.




8. The Buyer’s Conditions Precedent. If any of the following conditions are not waived by
the Buyer or satisfied on or before the Closing Date, the Buyer may terminate this Agreement and
receive a refund of the Earnest Money. The obligation of the Buyer to consummate the transactions
contemplated by this Agreement is subject to the satisfaction or waiver (subject to applicable law)
at or prior to the Closing Date of each of the following conditions: (a) no preliminary or
permanent injunction or other order will have been issued by any court of competent jurisdiction or
any regulatory body preventing consummation of the transactions contemplated by this Agreement; (b)
no action will have been commenced or threatened against the Sellers, the Buyer or any of their
respective affiliates, associates, officers or directors seeking damages arising from, to prevent
or challenge the transactions contemplated by this Agreement; (c) all key employees which the Buyer
elects to retain pursuant to the terms of paragraph 7.4 of this Agreement and who the Buyer agrees
to compensate at substantially the same level as currently compensated by the Sellers, will have
entered into an employment arrangement with the Buyer on terms satisfactory to the Buyer; (d) all
representations and warranties of the Sellers and the Shareholders contained herein will be true
and correct in all material respects on and as of the Closing Date; (e) the Sellers and the
Shareholders will have performed or satisfied on and as of the Closing Date, all obligations,
covenants, agreements and conditions contained in this Agreement to be performed or complied with
by such Sellers and Shareholders; (f)there is no




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material adverse change, nor any event which would result in any material adverse change, so far as
can reasonably be foreseen, in the Business or in the results of operations of the Business taken
as a whole; (g) the Business will not have incurred any material loss on or prior to the Closing
Date that adversely affects the operations of the Business, whether or not covered by insurance;
(h) all actions, proceedings, instruments and documents required to carry out the transactions
contemplated hereby will have been initiated, completed, obtained or drafted to the reasonable
satisfaction of Buyer’s counsel, and the Sellers and the Shareholders will have delivered such
additional certificates and other documents as the Buyer reasonably requests including, without
limitation, such certificates of the Sellers and Shareholders dated the Closing Date evidencing
compliance with the conditions set forth in this paragraph 8; (i) the Sellers will not be the
subject of any order, investigation or hearing by any regulatory authority or by the Illinois
income tax agency, the Internal Revenue Service, the Justice Department of the United States or any
public or private consumer protection or other agency, committee or organization; (j) all landlords
under the Leases will have approved the assignment of the Leases to the Buyer or entered into new
leases with the Buyer on terms reasonably satisfactory to the Buyer, including, without limitation,
that the Leases will have a minimum remaining term of ten (10) years after the Closing Date
(including options).



9. Sellers’ Conditions Precedent. If any of the following conditions are not waived by the
Sellers and the Shareholders, or satisfied on or before the Closing Date, the Sellers and the
Shareholders may terminate this Agreement. The obligation of the Sellers to consummate the
transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the
Closing Date, of each of the following conditions, any or all of which may be waived in whole or in
part: (a) no preliminary or permanent injunction or other order will have been issued by any court
of competent jurisdiction or any governmental or regulatory body preventing consummation of the
transactions contemplated by this Agreement; (b) no action will have been commenced or threatened
against the Sellers, the Shareholders, the Buyer or any of their respective affiliates, associates,
officers or directors seeking damages arising from, to prevent or to challenge the transactions
contemplated by this Agreement; (c) all representations and warranties of the Buyer contained
herein will be true and correct in all material respects on and as of the Closing Date; and (d) the
Buyer will have performed in all material respects all obligations, agreements and conditions
contained in this Agreement to be performed or complied with by the Buyer; (e) the Buyer will have
delivered or caused to be delivered to the Sellers and Shareholders each of the items specified in
Section 10.1; (f) the Buyer will not have any loss on or prior to the Closing Date not covered by
insurance that is materially adverse to the Buyer; (g) all actions, proceedings, instruments and
documents required to carry out the transactions contemplated hereby will have been initiated,
completed and obtained or drafted to the reasonable satisfaction of counsel to the Sellers and the
Buyer will have delivered such additional certificates and documents as the Sellers reasonably
request including, without limitation, such certificates of the Buyer dated the Closing Date
evidencing compliance with the conditions set forth in this Section 9; and (h) the relevant
Shareholders and the Buyer shall have entered into Employment Agreements substantially as set forth
at Schedule 7.4.



10. The Closing. Unless extended as provided herein, this Agreement will be consummated at
1:00 p.m. local time at a location near the Business agreed to by the parties on or before the
later of the following dates (the “Closing Date”): (a) June 2, 2008; or (b) the first
(1st) business day following the day on which the last of the conditions set forth in
paragraph 8 hereof is




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satisfied or waived. The Buyer or the Sellers may extend the Closing Date for up to thirty (30)
days for any reason by giving written notice to the other party prior to the Buyer’s meeting with
the Sellers’ employees.





	 	10.1.	 	The Buyer’s Deliveries. On the Closing Date, the Buyer will deliver
or cause to be delivered to the Sellers the following items (all documents will be duly
executed and acknowledged where required):






	 	10.1.1.	 	Payment. The cash portion of the Purchase Price as adjusted under
paragraphs 4.3 and 4.4;
	 
	 	10.1.2.	 	Financing Documents. The Financing Documents;
	 
	 	10.1.3.	 	Goodwill Protection Agreement. The Goodwill Protection Agreement;
	 
	 	10.1.4.	 	Employment Agreements. The Employment Agreements;
	 
	 	10.1.5.	 	Transition Agreement. The Transition Agreement.
	 
	 	10.1.6.	 	Lease Assignments. The Lease Assignments, provided the Buyer has
not entered into new Leases with the landlords;
	 
	 	10.1.7.	 	Evidence of Authority. Such resolutions, certificates of good
standing, incumbency certificates and other evidence of authority with respect
to the Buyer as might be reasonably requested by the Sellers;
	 
	 	10.1.8.	 	Closing Memorandum. A memorandum setting forth the items delivered
and accounting for the payments made on the Closing Date; and
	 
	 	10.1.9.	 	Additional Documents. Such additional documents as might be
reasonably requested by the Sellers to consummate this Agreement.






	 	10.2.	 	Sellers’ Deliveries. On the Closing Date, the Sellers and the
Shareholders will deliver or cause to be delivered to the Buyer the following items
(all documents will be duly executed and acknowledged where required):






	 	10.2.1.	 	Assignment. Bills of sale, assignments and conveyances reasonably
acceptable to the Buyer necessary to convey to the Buyer all of the Sellers’
right, title and interest in and to all of the personal property comprising a
portion of the Assets, including, without limitation, original certificates of
title for any Assets that are automobiles or other personal property covered by
a certificate of title law;
	 
	 	10.2.2.	 	Goodwill Protection Agreement. The Goodwill Protection Agreement;
	 
	 	10.2.3.	 	Employment Agreements. The Employment Agreements;
	 
	 	10.2.4.	 	Transition Agreement. The Transition Agreement.





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	 	10.2.5.	 	Lease Assignments. The Lease Assignments, provided the Buyer has
not entered into new Leases with the landlords;
	 
	 	10.2.6.	 	Documents; Keys. The originals of all documents to be assigned to
the Buyer, including, without limitation, all contracts, books and records; all
keys, combination locks and other security devices located at the Business.
	 
	 	10.2.7.	 	Closing Memorandum. A memorandum setting forth the items delivered
and accounting for the payments made on the Closing Date;
	 
	 	10.2.8.	 	Additional Documents. Such additional documents as might be
reasonably requested by the Buyer to consummate this Agreement.






	 	10.3.	 	Possession. Possession of the Business and all of the Assets in
connection with the Business will be deemed to be delivered to the Buyer effective 6:00
a.m. local time on the Closing Date (the “Time of Transfer”) free from all parties
claiming rights to possession of or having claims against the Business and the Assets
other than the Permitted Liens. In addition, with respect to each Asset and the
Business, risk of loss, damage, claim, liability or other matter including, without
limitation, all liabilities arising from any accident, personal injury, death, property
damage or other claim related to operation of the Business will pass from the Sellers
to the Buyer on the Closing Date.
	 
	 	10.4.	 	Costs. The Sellers and the Shareholders will pay the following
closing costs: (a) the Sellers’ and Shareholders’ attorneys’ fees, accountants’ fees
and fees of other advisors; (b) all sales taxes assessed in connection with
consummation of this transaction; and (c) any other charge imposed for the transfer of
any item comprising the Assets. The Buyer will pay the Buyer’s attorneys’ fees,
accountants’ fees and fees of other advisors.




11. Indemnification. The parties agree to indemnify each other as follows:





	 	11.1.	 	Sellers’ and Shareholders’ Indemnification. The Sellers and
Shareholders agree to pay, defend, indemnify, reimburse and hold harmless the Buyer and
the Buyer’s directors, officers, agents and employees (the “Buyer Indemnified Parties”)
for, from and against any loss, damage, diminution in value, claim, liability, debt,
obligation, expense or cost (including interest, reasonable legal fees, and expenses of
litigation and attorneys fees in enforcing this indemnity) incurred, suffered, paid by
or resulting to any of the Buyer Indemnified Parties and which results from: (a) any
breach or default in any representation or warranty set forth in this Agreement or in
the performance by the Sellers or the Shareholders of any covenant or obligation set
forth in this Agreement which is not cured as provided in paragraph 14 of this
Agreement; and (b) any claims, demands, violations, actions, assessments, taxes,
penalties, fines, costs, expenses, obligations or other liabilities with respect to the
ownership, operation or maintenance of the Business or the Assets prior to the Time of
Transfer.





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	 	11.2.	 	Buyer’s Indemnification. The Buyer agrees to indemnify and hold
harmless the Sellers, the Shareholders and their respective officers, directors,
managers, employees, agents and members (collectively, the “Seller Indemnified
Parties”) against any loss, liability, deficiency, damage, expense or cost (including
interest, reasonable legal fees and expenses of litigation and attorneys fees in
enforcing this indemnity), whether or not actually incurred or paid that the Seller
Indemnified Parties may suffer, sustain or become subject to, and which results from:
(a) any breach or default in any representation or warranty set forth in this Agreement
or in the performance by the Buyer of any covenant or obligation set forth in this
Agreement which is not cured as provided in paragraph 14 of this Agreement; and (b) any
claims, demands, violations, actions, assessments, taxes, penalties, fines, costs,
expenses, obligations or other liabilities with respect to the ownership, operation or
maintenance of the Business or the Assets after to the Time of Transfer.
	 
	 	11.3.	 	Other Remedies. The remedies provided by this paragraph 11 are in
addition to, and not in lieu of, such other remedies as may be available under
applicable laws. Without limitation, the Buyer is entitled to enforce this Agreement
by specific enforcement without the necessity of demonstrating inadequacy of damages or
irreparable harm.
	 
	 	11.4.	 	Limitations. Notwithstanding anything to the contrary herein
contained: (a) the collective total liability of the Sellers and the Shareholders for
the matters described in paragraph 11.1(a) above will not exceed $1,500,000.00; (b) the
total liability of the Buyer for the matters described in paragraph 11.2(a) above will
not exceed $1,500,000.00 (excluding the Buyer’s obligations under the Note and the
Goodwill Protection Agreement); (c) no obligation of the Sellers and the Shareholders
for indemnification under paragraph 11.1(a) above will be payable until such time as
the total of such losses payable exceed Fifty Thousand Dollars ($50,000) in the
aggregate, but then to the full extent of such losses (including the first $50,000 of
such losses) subject to the limitations in subparagraphs (a) and (b) of this paragraph
11.4; and (d) no obligation of the Buyer for indemnification under paragraph 11.2(a)
above will be payable until such time as the total of such losses payable exceed Fifty
Thousand Dollars ($50,000) in the aggregate, but then to the full extent of such losses
(including the first $50,000 of such losses) subject to the limitations in
subparagraphs (a) and (b) of this paragraph 11.4.
	 
	 	11.5.	 	Payment. Upon the determination of liability under this paragraph 11,
the appropriate party shall pay to the other, as the case may be, within ten days after
such determination, the amount of any claim for indemnification made hereunder. In the
event that the indemnified party is not paid in full for any such claim pursuant to the
foregoing provisions promptly after the other party’s obligation to indemnify has been
determined in accordance herewith, it shall have the rights to collect same as provided
by applicable law. Unpaid claims of parties to this Agreement (and not third parties)
will incur interest at a floating rate of interest equal to the prime rate published
from time to time in The Wall Street Journal.





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12. Set-Off. To secure the Sellers’ and the Shareholders obligations under this Agreement,
each Seller hereby grants to the Buyer a right of set-off upon and against the Promissory Note, the
Goodwill Protection Agreement, any rights of such Seller under this Agreement and any and all
amounts, proceeds, money or other property of such Seller at any time held by the Buyer. On a
default by the Sellers or Shareholders to this Agreement which is not cured as provided in
paragraph 14 of this Agreement, the Buyer is authorized to appropriate, set-off and apply the
property for which a right of set-off is provided under this paragraph 12 without further notice to
the defaulting party.



13. Termination. This Agreement may be terminated and the transactions contemplated hereby
may be abandoned by: (a) mutual consent of the Sellers, Shareholders and the Buyer; (b) the Buyer,
if the Buyer is not in default and the conditions set forth in paragraph 8 of this Agreement have
not been satisfied on or before the Closing Date; (c) the Sellers and the Shareholders, if the
Sellers and Shareholders are not in default, and the conditions precedent set forth in paragraph 9
of this Agreement have not been satisfied on or before the Closing Date; or(d) by either party if
such party is not in default and the transaction contemplated by this Agreement has not closed
prior to August 1, 2008, in which case the Earnest Money will be returned to the Buyer if the Buyer
is not in default. In the event of termination, written notice thereof will be given to the other
party or parties specifying the provision pursuant to which such termination is made. On
termination pursuant to this paragraph 13, this Agreement will become void and have no effect and
there will be no liability hereunder on the part of the Buyer or the Sellers or any of their
respective officers, directors, employees, agents, stockholders or principals.



14. Default. If a party fails to perform any obligation contained in this Agreement, the
party claiming default will serve written notice to the other party specifying the nature of such
default and demanding performance. If the Sellers and Shareholders fails to comply with such
written demand within ten (10) days after receipt thereof, the Buyer will have the option to waive
such default, to demand specific performance, to exercise any other remedy available at law or in
equity, or to terminate this Agreement and receive a return of the Earnest Money. If the Buyer
fails to comply with such written demand within ten (10) days after receipt thereof, the Sellers
and the Shareholders will have the option to elect one of the following remedies: (a) waive such
default; (b)terminate this Agreement and receive the Earnest Money as liquidated damages whereupon
the parties will be discharged from any further obligations and liabilities under this Agreement;
or (c) sue the Buyer for damages in which case the Earnest Money will remain in escrow pending the
conclusion of the lawsuit.



15. Miscellaneous. It is further agreed as follows:





	 	15.1.	 	Time. Time is of the essence of this Agreement.






	 	15.2.	 	Notices. Any notice, demand or communication required or permitted to
be given by any provision of this Agreement will be in writing and will be deemed to
have been given and received when delivered personally or by telefacsimile to the party
designated to receive such notice, or on the date following the day sent by overnight
courier, or on the third (3rd) business day after the same is sent by certified mail,
postage and charges prepaid, directed to the following addresses or





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	 	 	 	to such other or additional addresses as any party might designate by written notice
to the other parties:





	 	 	 
	If to Buyer:

	 	Apothecary Rx, LLC
	 

	 	Attn: Mr. Lewis P. Zeidner, President
	 

	 	5500 Wayzata Boulevard, Suite 210
	 

	 	Golden Valley, Minnesota 55416
	 

	 	Fax: (763) 647-1137
	 
	 	 
	With a copy to:

	 	Michael Meleen, Esquire
	 

	 	Commercial Law Group, P.C.
	 

	 	700 Oklahoma Tower
	 

	 	210 Park Avenue
	 

	 	Oklahoma City, Oklahoma 73102
	 

	 	Fax: (405) 232-5553
	 
	 	 
	To the Sellers:

	 	Rehn-Huerbinger Drug Company, Inc.
	 

	 	Attn: Edward Fox
	 

	 	7366 Lincoln Ave., Suite 408
	 

	 	Lincolnwood, IL 60712
	 

	 	Fax: (847) 673-2461
	 
	 	 
	With a copy to:

	 	Terry L. Engel
	 

	 	Deutsch, Levy & Engel, Chartered
	 

	 	225 W. Washington Street, Suite. 1700
	 

	 	Chicago, Illinois 60606
	 

	 	Fax: (312) 346-1859







	 	15.3.	 	Representations and Warranties. The respective representations and
warranties of the Sellers, Shareholders and the Buyer contained herein or in any
certificates or other documents delivered prior to or at the Closing Date will not be
deemed waived or otherwise affected by any investigation made by any party hereto.
Each and every such representation and warranty will survive the Closing Date and will
not be terminated or extinguished for a period of eighteen (18) months after the
Closing Date, provided that no claim may be made hereunder unless written notice of
such claim is sent to the other parties within such eighteen (18) month period. This
paragraph 15.3 will have no effect on any other obligations of the parties hereto,
whether to be performed before or after the Closing Date.
	 
	 	15.4.	 	Cooperation. Prior to and at all times following the termination or
closing of this Agreement, the parties agree to execute and deliver, or cause to be
executed and delivered, such documents and do, or cause to be done, such other acts and
things as might reasonably be requested by any party to this Agreement to assure that
the benefits of this Agreement are realized by the parties.
	 
	 	15.5.	 	Press Release. Other than by the Buyer as required by law with prior
notice to the Sellers, neither party will issue any press releases with regard to this
transaction





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	 	 	 	without the consent of the other party (which consent will not be unreasonably
withheld). The Sellers and the Shareholders will refer all inquiries concerning any
transaction contemplated by this Agreement to the Buyer.
	 
	 	15.6.	 	Headings. The paragraph headings contained in this Agreement are for
reference purposes only and are not intended to affect in any way the meaning or
interpretation of this Agreement.
	 
	 	15.7.	 	Entire Agreement. This Agreement and any document executed in
connection herewith on or after the date of this Agreement (the “Other Documents”)
constitute the entire agreement between the parties with respect to the subject matter
hereof and there are no agreements, understandings, warranties or representations
except as set forth herein or in the Other Documents.
	 
	 	15.8.	 	Assignment. It is agreed that the parties may not assign such party’s
rights nor delegate such party’s duties under this Agreement without the express
written consent of the other parties to this Agreement which consent will not be
unreasonably withheld. Notwithstanding the foregoing, the Buyer will be permitted to
assign this Agreement for all or part of the Assets to a wholly owned subsidiary
provided the Buyer remains liable for the performance of this Agreement and all
representations, warranties and covenants contained herein and shall remain obligated
under this Agreement and any other agreements, including, without limitation, the
Promissory Note.
	 
	 	15.9.	 	Amendment. Neither this Agreement, nor any of the provisions hereof
can be changed, waived, discharged or terminated, except by an instrument in writing
signed by the party against whom enforcement of the change, waiver, discharge or
termination is sought.
	 
	 	15.10.	 	Severability. If any clause or provision of this Agreement is illegal,
invalid or unenforceable under any present or future law, the remainder of this
Agreement will not be affected thereby. It is the intention of the parties that if any
such provision is held to be illegal, invalid or unenforceable, there will be added in
lieu thereof a provision as similar in terms to such provisions as is possible and to
be legal, valid and enforceable.
	 
	 	15.11.	 	Governing Law. This Agreement will be interpreted, construed and enforced in
accordance with the laws of the State of Illinois, regardless of any applicable
principles of conflicts of law. Any suit, action or other proceeding seeking to
enforce any provision of, or based on any matter arising out of or in connection with,
this Agreement or the transactions contemplated hereby may be brought in any court of
competent jurisdiction in Chicago, Illinois, or the United States District Court
sitting in Chicago, Illinois, and each of the parties hereby consents to the
jurisdiction of such courts (and of the related appellate courts) in any objection
which it may now or hereafter have to the laying of the venue of any such suit, action
or proceeding in any such court or that any such suit, action or proceeding which is
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	 	 	 	inconvenient forum. Process in any such suit, action or proceeding may be served on
any party anywhere in the world, whether within or without the jurisdiction of any
such court.
	 
	 	15.12.	 	Attorney Fees. If any party institutes an action or proceeding against any
other party relating to the provisions of this Agreement, the party to such action or
proceeding which does not prevail will reimburse the prevailing party therein for the
reasonable expenses of attorneys’ fees and disbursements incurred by the prevailing
party, as determined by order of the Court.
	 
	 	15.13.	 	Waiver. Waiver of performance of any obligation or term contained in this
Agreement by any party, or waiver by one party of the other’s default hereunder will
not operate as a waiver of performance of any other obligation or term of this
Agreement or a future waiver of the same obligation or a waiver of any future default.
	 
	 	15.14.	 	Brokerage. The Sellers and Shareholders represent to the Buyer that the
Sellers and Shareholders have dealt with no broker in connection herewith other than
Sunbelt Business Brokers. The Sellers and Shareholders agree to pay all commissions
owed to Sunbelt Business Brokers and hold the Buyer harmless from any claim for
brokerage commissions asserted by Sunbelt Business Brokers and any other party as a
result of dealings with the Sellers or the Shareholders. The Buyer represents that it
has not dealt with any broker relative to the transactions contemplated hereby and
agrees to indemnify and hold the Sellers and Shareholders harmless from any claim for
brokerage commissions asserted by any party as a result of dealings with the Buyer.
	 
	 	15.15.	 	Counterpart Execution. This Agreement may be executed in counterparts,
including by telefacsimile, each of which will be deemed an original and all of which
together will constitute a single document.
	 
	 	15.16.	 	Confidentiality. The agreements and covenants set forth in the
Confidentiality Agreement attached hereto as Schedule “15.16” shall remain in force to
and until the occurrence of the closing, except to the extent there is a conflict with
this Agreement in which case this Agreement will control and amend the Confidentiality
Agreement. All reference in the Confidentiality Agreement to “you,” “your” or the
“undersigned” are deemed to refer to the Buyer, and to the “Company” are deemed to
refer to the Sellers. All information disclosed to the Buyer under this Agreement
relating to the Business, the Sellers or the Shareholders is deemed to be “Information”
under the Confidentiality Agreement unless one of the exceptions in paragraph 1 of the
Confidentiality Agreement applies.





[Signature Pages Follow]




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SIGNATURE PAGE TO PHARMACY PURCHASE AGREEMENT




     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	The Sellers:




REHN-HUERBINGER DRUG CO., an Illinois

corporation

 	 
	 	By: 	/S/ STEVEN FEINERMAN
 	 
	 	 	                    , President 	 
	 	 	 	 
	 



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SIGNATURE PAGE TO PHARMACY PURCHASE AGREEMENT





     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	The Sellers:




666 DRUG CO., an Illinois corporation

 	 
	 	By: 	/S/ EDWARD FOX
 	 
	 	 	                    , President 	 
	 	 	 	 
	 



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     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	The Sellers:




PARKWAY DRUGS, INC, an Illinois corporation

 	 
	 	By: 	/S/ STEVEN FEINERMAN
 	 
	 	 	                    , President 	 
	 	 	 	 
	 



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SIGNATURE PAGE TO PHARMACY PURCHASE AGREEMENT





     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	The Sellers:




WILMETTE-HUERBINGER DRUG CO., an Illinois

corporation

 	 
	 	By: 	/S/ LAWRANCE  J. HORWITZ
 	 
	 	 	                    , President 	 
	 	 	 	 
	 



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     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	The Shareholders:

 	 
	 	/S/ EDWARD COX
 	 
	 	EDWARD FOX, individually 	 
	 	 	 
	 



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     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	The Shareholders:

 	 
	 	/S/ SIMPSON GOLD
 	 
	 	SIMPSON GOLD, individually 	 
	 	 	 
	 



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     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	The Shareholders:

 	 
	 	/S/ LAWRENCE HORWITZ
 	 
	 	LAWRENCE HORWITZ, individually 	 
	 	 	 
	 



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SIGNATURE PAGE TO PHARMACY PURCHASE AGREEMENT





     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	The Shareholders: 



	 
	 	/S/ STEVEN FEINERMAN
 	 
	 	STEVEN FEINERMAN, individually 	 
	 	 	 
	 



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SIGNATURE PAGE TO PHARMACY PURCHASE AGREEMENT





     IN WITNESS WHEREOF, this Agreement has been executed by the parties effective the date first
above written.



	 	 	 	 	 
	 	APOTHECARYRX, LLC, an Oklahoma limited

liability company

 	 
	 	By /S/ LEWIS P. ZEIDNER
 	 
	 	     Lewis P. Zeidner, President
 	 
	 	(the“Buyer”) 	 
	 



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SCHEDULES




	 	 	 	 	 
	Schedule “A”

	 	-
	 	Business
	Schedule “1.1”

	 	-
	 	Equipment
	Schedule “1.3”

	 	-
	 	Assigned Contracts
	Schedule “1.6”

	 	-
	 	Goodwill Protection Agreement
	Schedule “2”

	 	-
	 	Excluded Assets
	Schedule “3”

	 	-
	 	Permitted Liens
	Schedule “4.2”

	 	-
	 	Financing Documents
	Schedule “4.5”

	 	-
	 	Allocation of Purchase Price
	Schedule “6.1.1”

	 	-
	 	Financial Statements
	Schedule “6.1.3”

	 	-
	 	Liens
	Schedule “6.1.4”

	 	-
	 	Contracts
	Schedule “6.1.9”

	 	-
	 	Consents and Approvals
	Schedule “6.1.10”

	 	-
	 	Litigation
	Schedule “6.1.11”

	 	-
	 	Certain Employee Plans
	Schedule “6.1.15”

	 	-
	 	Labor Issues
	Schedule “7.4”

	 	-
	 	Employment Agreements
	Schedule “7.9”

	 	-
	 	Transition Agreement
	Schedule “15.16”

	 	-
	 	Confidentiality Agreement






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