kl06021_ex10-6.htm


    
      

    

     

    Exhibit
      10.6

     

     

     

    FIRST
      AMENDMENT

    TO

    AMENDED
      AND RESTATED STOCK SUBSCRIPTION

    AND
      SHARE TRANSFER AGREEMENT

     

    


    This
      First Amendment (this “First Amendment”) to Amended and Restated Stock
      Subscription and Share Transfer Agreement (the “Restated Original
      Subscription Agreement”), dated as of May 31, 2007, is by and between New
      World Brands, Inc., a Delaware corporation (the “Company”), and P&S
      Spirit, LLC, a Nevada limited liability company (the
“Subscriber”).  All capitalized terms not otherwise defined
      herein shall have the meanings ascribed to them in the Restated Original
      Subscription Agreement.

     

    RECITALS:

     

    WHEREAS,
      on December 29, 2006, the Company and the Subscriber entered into a Stock
      Subscription and Share Transfer Agreement, which the parties subsequently
      amended and restated in its entirety effective December 29, 2006 in the form
      of
      the Restated Original Subscription Agreement, providing for the purchase by
      the
      Subscriber of certain capital stock of the Company as more fully set forth
      therein; and

     

    WHEREAS,
      the Restated Original Subscription Agreement provides that upon the satisfaction
      of the Tranche B-1 Closing Condition and the Tranche B-2 Closing Condition,
      the
      Company will cause to be issued to the Subscriber the Tranche B-1 Shares and
      the
      Tranche B-2 Shares in consideration of the Tranche B-1 Purchase Price and the
      Tranche B-2 Purchase Price, as the case may be; and

     

    WHEREAS,
      Company management has determined that (i) based on current and projected sales,
      there is no reasonable expectation that the Company will meet the Tranche B-1
      Closing Condition or the Tranche B-2 Closing Condition, and (ii) it is very
      likely that due to reduced cash flow resulting from lower sales and continued
      investment in sales growth and product development, the Company’s cash position
      will reach critically low levels before the third quarter unless additional
      capital is made available to the Company; and

     

    WHEREAS,
      even though there is no reasonable expectation that the Tranche B-1 Closing
      Condition and the Tranche B-2 Closing Condition will be satisfied, and therefore
      the Subscriber will have no obligation to purchase the Aggregate Tranche B
      Shares, the Subscriber is willing to purchase the Aggregate Tranche B Shares
      in
      consideration for the agreement of the Company that (a) the total purchase
      price
      for the Aggregate Tranche B Shares shall be equal to the Tranche B-1 Purchase
      Price, and (b) any obligation of the Subscriber to pay the Tranche B-2 Purchase
      Price is hereby extinguished; and

     

    WHEREAS,
      the Company has requested the Subscriber to provide the Company with a line
      of
      credit of up to One Million Fifty Thousand Dollars ($1,050,000) for operating
      capital purposes (the “Credit Line Facility”), and the Subscriber is
      prepared to extend the Credit Line Facility to the Company under and in
      accordance with the terms and conditions set forth in that certain Credit Line
      and Security Agreement (the “Credit Agreement”) and that certain Credit
      Line Note (the “Note”), copies of which have been delivered to the
      Company and approved by unanimous consent of the Directors of the
      Company.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

     

    NOW,
      THEREFORE, in consideration of the premises and the mutual agreements herein
      set
      forth, the parties hereto desire to amend the Restated Original Subscription
      Agreement to reflect the aforementioned and certain other changes thereto as
      set
      forth herein:

     

    1.           As
      of the Closing Date (as defined below), the Company irrevocably agrees to issue
      and sell to the Subscriber, and the Subscriber irrevocably agrees to purchase,
      a
      total of 22,222,222 shares of Common Stock (the “Shares”), for a total
      purchase price of One Million Dollars ($1,000,000) (the “Purchase
      Price”), and the Company shall deliver, or cause to be delivered, to the
      Subscriber, in accordance with the terms of the Escrow Agreement, stock
      certificates representing the Shares.

     

    2.           The
      obligation of the Subscriber to pay the Tranche B-2 Purchase Price is hereby
      extinguished, and the obligations of the Subscriber to consummate the Tranche
      B-1 and Tranche B-2 Closings, as described in the Restated Original Subscription
      Agreement, are hereby extinguished and such closings shall not
      occur.

     

    3.           The
      payment of the Purchase Price and the delivery of the Shares, shall occur and
      be
      effective simultaneously with the execution of this First Amendment, remotely
      at
      the offices of the Company, 340 W. 5th Avenue,
      Eugene,
      Oregon (the “Closing Date” and the closing the
“Closing”).  At the Closing:

     

    (a)           the
      Subscriber shall deliver, or cause to be delivered, to the Company:

     

    (i)   
      the Purchase Price, in immediately available funds by wire transfer to an
      account designated by the Company in writing to the Subscriber;

     

    (ii)  
      an executed copy of the Credit Agreement and all related documents, and shall
      have made the Credit Line Facility available pursuant to the terms
      thereof;

     

    (iii)  an
      executed copy of the First Amendment to Amended and Restated Voting Agreement
      in
      the form attached hereto as Annex 2;

     

    (iv)  an
      executed copy of the First Amendment to Amended and Restated Lock-Up Agreement
      in the form attached hereto as Annex 3; and

     

    (v)  
      a certificate executed by a duly authorized officer of the Subscriber certifying
      that the representations and warranties made by the Subscriber in Section
      4 of the Restated Original Subscription Agreement are true and correct in
      all material respects as of the Closing Date (except to the extent a
      representation or warranty is expressly limited by its terms to another date);
      and

     

    (b)           the
      Company shall deliver, or cause to be delivered, to the Subscriber:

     

    (i)  
       in accordance with the terms of the Escrow Agreement, stock certificates
      representing the Shares;

     

    (ii)  
      an executed copy of the Credit Agreement, the Note and all related
      documents;

     

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

     

    (iii)  an
      executed copy of the First Amendment to Amended and Restated Voting Agreement
      in
      the form attached hereto as Annex 2;

     

    (iv)  an
      executed copy of the First Amendment to Amended and Restated Lock-Up Agreement
      in the form attached hereto as Annex 3; and

     

    (v) 
      a certificate executed by a duly authorized officer of the Company certifying
      that (A) the  representations and warranties made by the Company in
Section 5 of the Restated Original Subscription Agreement are true and
      correct in all material respects as of the Closing Date (except to the extent
      a
      representation or warranty is expressly limited by its terms to another date),
      and (B) there shall have been no material adverse change in the business,
      condition (financial or otherwise), assets, liabilities (contingent or
      otherwise), operations or results of operations of the Company since the date
      of
      the Restated Original Subscription Agreement.

     

    4.           By
      execution of this First Amendment, the Company, M. David Kamrat and Noah Kamrat,
      all acknowledge that the Subscriber is contemplating transferring a portion
      of
      the membership interests of the Subscriber to Mark S. Kahan and agree that
      the
      transfer of such interests, if it occurs, shall be permitted notwithstanding
      anything to the contrary in the Restated Original Subscription Agreement as
      amended by this First Amendment, and the Company, M. David Kamrat and Noah
      Kamrat all waive any right that any of them may have to object to such
      transfer.

     

    5.           Except
      as specifically amended hereby, the Restated Original Subscription Agreement
      is
      hereby ratified and confirmed in all respects and shall remain in full force
      and
      effect.

     

    6.           To
      the extent of any inconsistency between the terms of the Restated Original
      Subscription Agreement and this First Amendment, the terms of this First
      Amendment will control.  Each reference in the Restated Original
      Subscription Agreement to “this Agreement,” “herein,” “hereunder” or words of
      similar import shall be deemed to be a reference to the Restated Original
      Subscription Agreement as amended by this First Amendment, and the Restated
      Original Subscription Agreement as so amended shall be read as a single,
      integrated document.

    


    7.           This
      First Amendment may be executed in two or more counterparts, and by the
      different parties hereto in separate counterparts, each of which when executed
      shall be deemed to be an original but all of which taken together shall
      constitute one and the same agreement.  Facsimile transmission of any
      signed original counterpart and/or retransmission of any signed facsimile
      transmission shall be deemed the same as the delivery of an
      original.  The introductory Recitals are incorporated into and made a
      substantive part of this First Amendment.

    


    


    [Signature
      page follows]

    


     

     

    


    
      
        
          
          

        

        
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    IN
      WITNESS WHEREOF, the parties hereto have executed this First Amendment as of
      the
      day and year first above written.

    


     

                    NEW
      WORLD BRANDS,
      INC.

    


    


                    By: /s/
      M. David Kamrat

                    Name:
M.
      David
      Kamrat

                    Title:  
      CEO

    


    


                    P&S
      SPIRIT,
      LLC


    


                    By: /s/
      Selvin Passen, M.D.

                    Name: Selvin
      Passen, M.D.

                    Title:   Manager

    


                    Acknowledged
      and
      agreed by M. David Kamrat and Noah Kamrat:


    


                                                

                    /s/
      M. David
      Kamrat

               
      M. David Kamrat

     

     

                                                   
      /s/ Noah Kamrat
                Noah
      Kamrat

    


     

     

    
 

    


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