# EDGAR Filing Document

**Accession Number:** 0002064965
**File Stem:** 0001683168-26-003455
**Filing Date:** 2026-5
**Character Count:** 569808
**Document Hash:** 71eba1896d3d0a0432d91f3745dd6c69
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001683168-26-003455.hdr.sgml**: 20260504

**ACCESSION NUMBER**: 0001683168-26-003455

**CONFORMED SUBMISSION TYPE**: 1-A/A

**PUBLIC DOCUMENT COUNT**: 12

**FILED AS OF DATE**: 20260504

**DATE AS OF CHANGE**: 20260504

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Stellar Spirits & Wines, Inc.
- **CENTRAL INDEX KEY:** 0002064965
- **STANDARD INDUSTRIAL CLASSIFICATION:** BEVERAGES [2080]
- **ORGANIZATION NAME:** 04 Manufacturing
- **EIN:** 872326106
- **STATE OF INCORPORATION:** CA
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 1-A/A
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 024-12605
- **FILM NUMBER:** 26938900

**BUSINESS ADDRESS:**
- **STREET 1:** 970 NO. TUSTIN AVE., SUITE 100
- **CITY:** ANAHEIM
- **STATE:** CA
- **ZIP:** 92807
- **BUSINESS PHONE:** 714-242-5130

**MAIL ADDRESS:**
- **STREET 1:** 970 NO. TUSTIN AVE., SUITE 100
- **CITY:** ANAHEIM
- **STATE:** CA
- **ZIP:** 92807

## Part

[**Table of Contents**](#a_001)

 **Preliminary Offering Circular dated May 4, 2026**

**An Offering Statement pursuant to Regulation A relating to these securities has been filed with the Securities and Exchange Commission. Information contained in this Preliminary Offering Circular is subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted before the Offering Statement filed with the Commission is qualified. This Preliminary Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy nor may there be any sales of these securities in any state in which such offer, solicitation or sale would be unlawful before registration or qualification under the laws of any such state. We may elect to satisfy our obligation to deliver a Final Offering Circular by sending you a notice within two business days after the completion of our sale to you that contains the URL where the Final Offering Circular or the Offering Statement in which such Final Offering Circular was filed may be obtained.**

![](logo.jpg)

**$10,000,000**

**$2.00 per Share**

**5,000,000 Shares,** 

**Minimum Investment 50,000 Shares ($100,000)**

This is the public offering of securities of Stellar Spirits and Wines, Inc., a California Corporation. We are offering up to 5,000,000 shares of our Common Stock, par value $0.0001 ("Common Stock"), at an offering price of $2.00 per share (the "Offered Shares" or "Shares") by the Company. See "Description of Securities" beginning on page 55 and "Securities Offered" on page 56. This Offering (the "Offering") will terminate at the earlier of (i) the date on which the Maximum Offering is sold, (ii) the third anniversary of the date of qualification of this offering statement; or (iii) when the Company elects to terminate the offering for any reason (in each such case, the "Termination Date"). The Company will file a post-qualification amendment to this Offering Statement at least every twelve (12) months following the date on which this offering is qualified by the United States Securities and Exchange Commission (the "Commission") in order to include the Company's most recent financial statements. This obligation will continue for a period of up to three (3) years from the date of qualification, unless the offering is earlier terminated (such date, the "Termination Date"). The minimum purchase requirement per investor is 50,000 Offered Shares ($100,000); however, we can waive the minimum purchase requirement on a case-by-case basis in our sole discretion. As of December 31, 2025, our Sole Officer and Director, Luis Cota (our "Officer"), beneficially owns **23,000,000** shares of our common stock, representing approximately 5.13% of the 323,000,000 shares of common stock deemed outstanding as of that date. Assuming the sale of all 5,000,000 Offered Shares in this Offering, Mr. Cota's ownership percentage would be approximately 5.07%.

**These securities are speculative securities. Investment in the Company's stock involves significant risk. You should purchase these securities only if you can afford a complete loss of your investment. See the "[Risk Factors](#a_006)" section on page 6 of this Offering Circular.** 

**No Escrow**

The proceeds of this offering will not be placed into an escrow account. We will offer our Shares on a "best efforts" basis. As there is no minimum offering, upon the approval of any subscription to this Offering Circular, the Company shall immediately deposit said proceeds into the bank account of the Company and may dispose of the proceeds in accordance with the Use of Proceeds. The Company will not raise more than $10,000,000 in gross proceeds from this Offering.

Subscriptions are irrevocable and the purchase price is non-refundable as expressly stated in this Offering Circular. The Company, by determination of the Board of Directors, in its sole discretion, may issue the Securities under this Offering for cash, promissory notes, services, and/or other consideration without notice to subscribers. Any of the foregoing non-cash consideration received by the Company shall be valued according to the Note to Rule 251(a)(1) of Regulation A. All proceeds received by the Company from subscribers for this Offering will be available for use by the Company upon acceptance of subscriptions for the Securities by the Company.

Sale of these Shares will commence within two calendar days of the qualification date and it will be a continuous Offering pursuant to Rule 251(d)(3)(i)(F).

This Offering will be conducted on a "best-efforts" basis, which means our Officer will use his commercially reasonable best efforts in an attempt to offer and sell the Shares. Our Officer will not receive any commission or any other remuneration for these sales. In offering the securities on our behalf, our Officer will rely on the safe harbor from broker-dealer registration set out in Rule 3a4-1 under the Securities Exchange Act of 1934, as amended.

This Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sales of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful, prior to registration or qualification under the laws of any such state.

This offering circular is following the offering circular format described in Part II (a)(1)(i) of Form 1-A. Our Common Stock does not currently have a public market.

 **Investing in our Common Stock involves a high degree of risk. See "[Risk Factors](#a_006)" beginning on page 6 for a discussion of certain risks that you should consider in connection with an investment in our Common Stock.**

---

| | | | |
|:---|:---|:---|:---|
|  | **Number of Shares**<br> **or Shares** | **Per Share**<br> **or Share** <br> **<sup>(1)(2)(3)</sup>** | **Total**<br> **Maximum<sup>(4)</sup>** |
| Public Offering Price– Shares | 5000000 | $2.00 | $10000000 |
| Proceeds to Company – Shares |  |  | $10000000 |

---

________________

(1) We are offering Shares on a continuous basis. See " [Distribution](#a_009) – Continuous Offering. The number of Shares being sold is 5,000,000 Shares.

(2) This is a "best efforts" offering. The proceeds of this offering will not be placed into an escrow account. We will offer the Shares on a best efforts basis primarily through an online platform. As there is no minimum offering, upon the approval of any subscription to this Offering Circular, the Company shall immediately deposit said proceeds into the bank account of the Company and may dispose of the proceeds in accordance with the Use of Proceeds. See "How to Subscribe."

(3) We are offering these securities without an underwriter.

(4) Excludes estimated total offering expenses, including underwriting discount and commissions, will be approximately $19,000 assuming the maximum offering amount is sold.

Our Board of Directors used its business judgment in setting a value of $2.00 per Share to the Company as consideration for the stock to be issued under the Offering. The sales price per Share bears no relationship to our book value or any other measure of our current value or worth.

**THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION DOES NOT PASS UPON THE MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER, THE COMMISSION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.**

**WE ARE OFFERING TO SELL, AND SEEKING OFFERS TO BUY, OUR SHARES ONLY IN JURISDICTIONS WHERE SUCH OFFERS AND SALES ARE PERMITTED. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS OFFERING CIRCULAR. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH ANY INFORMATION OTHER THAN THE INFORMATION CONTAINED IN THIS OFFERING CIRCULAR. THE INFORMATION CONTAINED IN THIS OFFERING CIRCULAR IS ACCURATE ONLY AS OF ITS DATE, REGARDLESS OF THE TIME OF ITS DELIVERY OR OF ANY SALE OR DELIVERY OF OUR SHARES. NEITHER THE DELIVERY OF THIS OFFERING CIRCULAR NOR ANY SALE OR DELIVERY OF OUR SHARES SHALL, UNDER ANY CIRCUMSTANCES, IMPLY THAT THERE HAS BEEN NO CHANGE IN OUR AFFAIRS SINCE THE DATE OF THIS OFFERING CIRCULAR. THIS OFFERING CIRCULAR WILL BE UPDATED AND MADE AVAILABLE FOR DELIVERY TO THE EXTENT REQUIRED BY THE FEDERAL SECURITIES LAWS.**

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS](#a_002) | 1 |
| [MARKET AND INDUSTRY DATA](#a_003) | 2 |
| [SUMMARY](#a_004) | 3 |
| [THE OFFERING](#a_005) | 5 |
| [RISK FACTORS](#a_006) | 6 |
| [USE OF PROCEEDS](#a_007) | 24 |
| [DILUTION](#a_008) | 26 |
| [DISTRIBUTION](#a_009) | 28 |
| [SELLING SECURITY HOLDERS](#a_010) | 30 |
| [MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#a_011) | 30 |
| [BUSINESS](#a_012) | 37 |
| [MANAGEMENT](#a_013) | 47 |
| [EXECUTIVE COMPENSATION](#a_014) | 48 |
| [CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS](#a_016) | 50 |
| [PRINCIPAL STOCKHOLDERS](#a_017) | 54 |
| [INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS](#a_018) | 54 |
| [DESCRIPTION OF SECURITIES](#a_019) | 55 |
| [DIVIDEND POLICY](#a_020) | 56 |
| [SECURITIES OFFERED](#a_021) | 56 |
| [SHARES ELIGIBLE FOR FUTURE SALE](#a_022) | 56 |
| [LEGAL MATTERS](#a_023) | 57 |
| [EXPERTS](#a_024) | 57 |
| [WHERE YOU CAN FIND MORE INFORMATION](#a_025) | 57 |
| [INDEX TO CONSOLIDATED FINANCIAL STATEMENTS](#a_026) | F-1 |

---

We are offering to sell, and seeking offers to buy, our securities only in jurisdictions where such offers and sales are permitted. You should rely only on the information contained in this Offering Circular. We have not authorized anyone to provide you with any information other than the information contained in this Offering Circular. The information contained in this Offering Circular is accurate only as of its date, regardless of the time of its delivery or of any sale or delivery of our securities. Neither the delivery of this Offering Circular nor any sale or delivery of our securities shall, under any circumstances, imply that there has been no change in our affairs since the date of this Offering Circular. This Offering Circular will be updated and made available for delivery to the extent required by the federal securities laws.

**Continuous Offering**

Under Rule 251(d)(3) to Regulation A, the following types of continuous or delayed Offerings are permitted, among others: (1) securities offered or sold by or on behalf of a person other than the issuer or its subsidiary or a person of which the issuer is a subsidiary; (2) securities issued upon conversion of other outstanding securities; or (3) securities that are part of an Offering which commences within two calendar days after the qualification date. These may be offered on a continuous basis and may continue to be offered for a period in excess of 30 days from the date of initial qualification. They may be offered in an amount that, at the time the Offering statement is qualified, is reasonably expected to be offered and sold within one year from the initial qualification date. No securities will be offered or sold "at the market."

Sale of these shares will commence within two calendar days of the qualification date, and it will be a continuous Offering pursuant to Rule 251(d)(3)(i)(F).

Subscriptions are irrevocable and the purchase price is non-refundable as expressly stated in this Offering Circular. The Company, by determination of the Board of Directors, in its sole discretion, may issue the Securities under this Offering for cash, promissory notes, and services without notice to subscribers. Any of the foregoing non-cash consideration received by the Company shall be valued according to the Note to Rule 251(a)(1) of Regulation A. All proceeds received by the Company from subscribers for this Offering will be available for use by the Company upon acceptance of subscriptions for the Securities by the Company.

In this Offering Circular, unless the context indicates otherwise, references to "Stellar Spirits and Wines, Inc.", "Stellar Spirits and Wines,", "STELLAR", "we", the "Company", "our" and "us" refer to the activities of and the assets and liabilities of the business and operations of Stellar Spirits and Wines, Inc.

i

**CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS**

__________

Some of the statements under "[Summary](#a_004)", "[Risk Factors](#a_006)", "[Management's Discussion and Analysis of Financial Condition and Results of Operations](#a_011)", "[Our Business](#a_012)" and elsewhere in this Offering Circular constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that are not historical facts. In some cases, you can identify forward-looking statements by terms such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "potential", "should", "will" and "would" or the negatives of these terms or other comparable terminology.

You should not place undue reliance on forward looking statements. The cautionary statements set forth in this Offering Circular, including in "[Risk Factors](#a_006)" and elsewhere, identify important factors which you should consider in evaluating our forward-looking statements. These factors include, among other things:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· The speculative nature of the Spirit business
 and more specifically the Tequila business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our reliance on third party distillery, bottle
 makers, suppliers and customers;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our dependence upon external sources for the financing of our operations, particularly given that there are concerns about our ability to continue as a "going concern;"

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our ability to effectively execute our business plan,
 expansion of our markets and growth of our brand;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our ability to manage our expansion, growth and operating expenses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our ability to finance our businesses, through this Offering and
 through private offerings;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our ability to promote our Tequila and Spirit businesses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our ability to compete and succeed in the highly competitive and evolving
 Spirit and Tequila businesses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our ability to respond and adapt to changes in customer behavior,
 potential tariffs and regulations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Our ability to protect our intellectual property and to develop, maintain and enhance strong brands.

Although the forward-looking statements in this Offering Circular are based on our beliefs, assumptions and expectations, taking into account all information currently available to us and our perception and interpretation thereof, we cannot guarantee future transactions, results, performance, achievements or outcomes. No assurance can be made to any investor by anyone that the expectations reflected in our forward-looking statements will be attained, or that deviations from them will not be material and adverse. We urge you to read this Offering Circular in its entirety and not place undue reliance on forward-looking statements. We undertake no obligation, other than as may be required by law, to re-issue this Offering Circular or otherwise make public statements revising and/or updating our forward-looking statements if events occur or circumstances change.

**MARKET AND INDUSTRY DATA**

Certain market data and forecasts used throughout this prospectus were obtained from internal company surveys, market research, consultant surveys, reports of governmental and international agencies and industry publications and surveys. Industry publications and third-party research, surveys and reports generally indicate that their information has been obtained from sources believed to be reliable. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. Our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading "<u>Risk Factors</u>" in this prospectus.

All forward-looking statements attributable to us are expressly qualified in their entirety by these risks and uncertainties. These risks and uncertainties, along with others, are also described below under the heading "[Risk Factors](#a_006)." Should one or more of these risks or uncertainties materialize, or should any of the parties' assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. You should not place undue reliance on any forward-looking statements and should not make an investment decision based solely on these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

**SUMMARY**

__________

*This summary highlights selected information contained elsewhere in this Offering Circular. This summary is not complete and does not contain all the information that you should consider before deciding whether to invest in the Shares. You should carefully read the entire Offering Circular, including the risks associated with an investment in the company discussed in the "[Risk Factors](#a_006)" section of this Offering Circular, before making an investment decision. Some of the statements in this Offering Circular are forward-looking statements. See the section entitled "[Cautionary Statement Regarding Forward-Looking Statements](#a_002)."*

**Company Information**

Stellar Spirits and Wines, Inc. ("Stellar Spirits and Wines," "Company," "we" or "us") was incorporated on July 9, 2021, in the State of California. We are a California-based producer, importer, distributor and marketer of premium brand spirits. We own the Comisario® tequila brand and also have exclusive North American, and Chinese distribution rights to Yamazakura Japanese Whiskies, Yamazakura Japanese Sake Wines, Marta Tequila, and we plan to add additional brands throughout 2026. We seek to be a leader in providing spirits that offer better value than comparable spirits.

**Brand Owner/Importer**

Our flagship brand, Comisario® Tequila, is one of the highest-awarded tequilas, winning USA and international competitions, including multiple Gold and Double-Gold medals, Best of Class, Tequila of the Year, 98-point ratings. Our Comisario® Tequila also recently ranked #2 Blanco and #3 Añejo in the "World Spirits Competition" as announced by *Cigar and Spirits* Magazine. See **Exhibit 6.1** for further information about awards and ratings.

 **

**Distribution**

 **

In addition to our role as a brand owner, importer, and marketer, we have selectively chosen specific markets in which to act as a distributor:

&nbsp;&nbsp;&nbsp;&nbsp;· The Company is has recently signed with a North
American distributor who will distribute our product to licensed retail and on-premise locations in 42 states.

&nbsp;&nbsp;&nbsp;&nbsp;· We are currently working on major retailers with
400+ locations to immediately increase our sales. As of this Offering no contracts or agreements have been entered into and there is no
guarantee that we will ever enter into any contracts or agreements with those retailers.

&nbsp;&nbsp;&nbsp;&nbsp;· The Company is currently assessing further distributor
opportunities in selected markets in anticipation of new product lines being introduced (whiskey, mezcal and energy drinks).

**Our Competitive Strengths**

We believe that we have the following competitive strengths:

&nbsp;&nbsp;&nbsp;&nbsp;· Award winning, high quality, premium branded
spirits with significant potential in the higher growth categories of the distilled spirits industry;

&nbsp;&nbsp;&nbsp;&nbsp;· Our sales and marketing program, which currently
includes our experienced founder, and incorporate strategic sales consultants who are focused on advertising, marketing, and promotional
programs, and who will then augment, direct and teach our planned distributor sales forces;

&nbsp;&nbsp;&nbsp;&nbsp;· Mr. Cota, our highly qualified and experienced
sole Officer and Director, who has a successful track record in brand development, in the wines and distilled spirits industries;

&nbsp;&nbsp;&nbsp;&nbsp;· Our recent track record in establishing value
added strategic partnerships; and

&nbsp;&nbsp;&nbsp;&nbsp;· Our key network of relationships in the alcoholic
beverage market, through Mr. Cota our CEO, along with celebrity ambassadors, sports teams and influencers.

**Growth and Distribution Strategy**

Our objective is to continue building a distinctive portfolio of global premium spirits brands, with a primary focus on increasing both our total and individual brand case sales. To achieve this, we intend to:

&nbsp;&nbsp;&nbsp;&nbsp;· Develop focused sales efforts in key markets;

&nbsp;&nbsp;&nbsp;&nbsp;· Increase market penetration of our existing spirits
brands;

&nbsp;&nbsp;&nbsp;&nbsp;· Build brand awareness through innovative marketing,
advertising, social media exposure and promotional activities; and

&nbsp;&nbsp;&nbsp;&nbsp;· Selectively add new premium brands to our spirits
portfolio (expected to add whiskey, mezcal and energy drink projects).

**Corporate Information and History**

Stellar Spirits and Wines, Inc., a California corporation, was incorporated on July 9<sup>th</sup>, 2021. Our principal office is located at 970 North Tustin Avenue, Suite 100, Anaheim, California 92807. Our telephone number is 714-242-5130.

Our fiscal year-end date is December 31.

We currently maintain and sell our products through our websites www.tequilaComisario® .com, https://stellar-sw.com/, and our email address is www.info@stellar-sw.com.

We do not incorporate the information on or accessible through our websites into this Offering Circular, and you should not consider any information on, or that can be accessed through, our websites a part of this Offering Circular.

**Section 15(g) of the Securities Exchange Act of 1934**

Our shares are covered by section 15(g) of the Securities Exchange Act of 1934, as amended that imposes additional sales practice requirements on broker/dealers who sell such securities to persons other than established customers and accredited investors (generally institutions with assets in excess of $10,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouses). For transactions covered by the Rule, the broker/dealer must make a special suitability determination for the purchase and have received the purchaser's written agreement to the transaction prior to the sale. Consequently, the Rule may affect the ability of broker/dealers to sell our securities and also may affect your ability to sell your shares in the secondary market.

Section 15(g) also imposes additional sales practice requirements on broker/dealers who sell penny securities. These rules require a one-page summary of certain essential items. The items include the risk of investing in penny stocks in both public offerings and secondary marketing; terms important to in understanding of the function of the penny stock market, such as bid and offer quotes, a dealers spread and broker/dealer compensation; the broker/dealer compensation, the broker/dealers' duties to its customers, including the disclosures required by any other penny stock disclosure rules; the customers' rights and remedies in cases of fraud in penny stock transactions; and, the FINRA's toll free telephone number and the central number of the North American Securities Administrators Association, for information on the disciplinary history of broker/dealers and their associated persons.

**Dividends**

The Company has not declared or paid a cash dividend to stockholders since it was organized and does not intend to pay dividends in the foreseeable future. The board of directors presently intends to retain any earnings to finance our operations and does not expect to authorize cash dividends in the foreseeable future. Any payment of cash dividends in the future will depend upon the Company's earnings, capital requirements and other factors.

**Trading Market**

Our Common Stock does not currently have a public market.

**THE OFFERING**

**__________**

---

| | |
|:---|:---|
| **Issuer:** | Stellar Spirits and Wines, Inc. |
| **Securities offered:** | A maximum of 5,000,000 Shares, par value $0.0001 ("Shares") at an offering price of $2.00 per Share (the "Offered Shares"). (See "[Distribution](#a_009).") |
| **Number of shares of Common Stock outstanding before the offering** | 323,000,000 issued and outstanding as of December 31, 2025 |
| **Number of shares of Common Stock to be outstanding after the offering** | 453,848,415 shares, if the maximum amount of Offered Shares are sold. The total number of shares of our common stock outstanding assumes that the maximum number of Shares of our common stock is sold in this offering. |
| **Price per Share:** | $2.00 per Share. |
| **Maximum offering amount:** | 5,000,000 Shares at $2.00 per Share, or $10,000,000 (See "[Distribution](#a_009)."). |
| **Trading Market:** | Our Common Stock does not currently have a public market. |
| **No Liquidity** | There is no current public market for the Shares, and none is expected to develop. See "[Risk Factors](#a_006)" and "[Description of the Securities](#a_019)" below for a further discussion. The Company may facilitate or otherwise participate in the secondary transfer of any Shares on a limited basis at its discretion. Prospective Investors are urged to consult their own legal advisors with respect to secondary trading of the Shares. Further, we plan to apply for quotation on the OTC; however, there can be no assurance that we will obtain such quotation, or as to the level of trading that might occur if we do. |
| **Use of proceeds:** | If we sell all of the Shares being offered, our net proceeds (after our estimated offering expenses) will be $9,981,000.00. We will use these net proceeds for working capital and other general corporate purposes. |
| **Risk factors:** | Investing in our Common Stock involves a high degree of risk, including:<br>Immediate and substantial dilution.<br>Limited market for our stock.<br>See the section entitled "[Risk Factors](#a_006)" in this offering circular and other information included in this offering circular for a discussion of factors you should carefully consider before deciding to invest in our Shares. |

---

**RISK FACTORS**

__________

The following is only a brief summary of the risks involved in investing in our Company. Investment in our Securities involves risks. You should carefully consider the following risk factors in addition to other information contained in this Disclosure Document. The occurrence of any of the following risks might cause you to lose all or part of your investment. Some statements in this Document, including statements in the following risk factors, constitute "Forward-Looking Statements."

Our business is subject to many risks, as more fully described in the section titled "Risk Factors" in this Offering Circular. You should read and carefully consider these risks, together with the risks set forth under the section titled "Risk Factors" and all of the other information in this Offering Circular, including the financial statements and the related notes included elsewhere in this Offering Circular, before deciding whether to invest in our securities. If any of the risks discussed in this Offering Circular actually occur, our business, financial condition or operating results could be materially and adversely affected. In particular, such risks include, but are not limited to, the following:

&nbsp;&nbsp;&nbsp;&nbsp;· Our business is subject to risks arising from epidemic diseases, such as the COVID-19 pandemic.

· Raising additional capital may cause dilution to our stockholders.

· Regulatory and legal uncertainties could result in significant costs or otherwise harm our business.

The following risks relate to our businesses and the effects upon us assuming we obtain financing in a sufficient amount.

***We have a limited operating history upon which you can evaluate our performance. Accordingly, our prospects must be considered in light of the risks that any new company encounters.***

 ****

The likelihood of our creation of a successful business must be considered in light of the problems, expenses, difficulties, complications, and delays frequently encountered in connection with the growth of a business, operation in a competitive industry, and the continued development of our products. There is no assurance that we will maintain profitability in the near future. You should consider our business, operations, and prospects in light of the risks, expenses and challenges faced as an emerging growth company.

***We are dependent upon management, key personnel, and consultants to execute our business plan.***

Our success is heavily dependent upon the continued active participation of our current management team, especially our current sole executive officer. Loss of this individual could have a material adverse effect upon our business, financial condition, or results of operations. Further, our success and the achievement of our growth plans depends on our ability to recruit, hire, train, and retain other highly qualified technical and managerial personnel. Competition for qualified employees among companies in our industry, and the loss of any of such persons, or an inability to attract, retain, and motivate any additional highly skilled employees required for the expansion of our activities, could have a materially adverse effect on our business. If we are unable to attract and retain the necessary personnel, consultants, and advisors, it could have a material adverse effect on our business, financial condition, or operations.

***The Company needs to increase brand awareness.***

Due to a variety of factors, our opportunity to achieve and maintain a significant market share may be limited. Developing and maintaining awareness of the Company's brand names, among other factors, is critical. Further, the importance of brand recognition will increase as competition in the Company's market increases. Successfully promoting and positioning our brand will depend largely on the effectiveness of our ability to form strategic partnerships with recognized distilleries. If we fail to successfully form these partnerships, it will have a material adverse effect on the Company's results of operations.

***We currently have limited existing brand identity and customer loyalty; if we fail to market our brand to promote our products, our business could suffer.***

We believe that establishing and maintaining brand identity and brand loyalty is critical to attracting customers for our current and future products we offer. In order to attract customers to our Tequila Comisario®, Marta Tequila, and Yamazuakura products, we may be forced to spend substantial funds to create and maintain brand recognition among consumers. We believe that the cost of our sales campaigns could increase substantially in the future. If our branding efforts are not successful, our ability to earn revenues and sustain our operations will be harmed.

***In the event we are not successful in reaching our revenue targets, additional funds may be required.***

 ****

We may not be able to proceed with our business plan for the development and marketing of our alcoholic beverage products. Should this occur, we may be forced to suspend or cease operations. Management intends to raise additional funds by way of a public or private offering. While we believe in the viability of our strategy to increase revenues and in our ability to raise additional funds, there can be no assurances to that effect. Our ability to continue as a going concern is dependent upon our ability to further implement our business plan, raise additional money, and generate sufficient revenues.

***Unfavorable economic conditions could negatively affect our operations and results.***

Unfavorable global or regional economic conditions, including uncertainty caused by unstable geopolitical environments in many parts of the world, could adversely affect our business and financial results. For example, it is currently not possible to predict the economic and political effects of the military operations in Ukraine or of the sanctions placed on Russia. Many markets where our products are sold face significant economic challenges. Unfavorable economic conditions can cause governments to increase taxes on alcoholic beverages to attempt to raise revenue, reduce consumers' willingness to make discretionary purchases of alcoholic beverage products, or pay for premium brands such as ours. In unfavorable economic conditions, consumers may make more value-driven and price-sensitive purchasing choices and drink more at home rather than at restaurants, hotels and bars, which tend to favor many of our premium and super-premium products.

Unfavorable economic conditions could also adversely affect our suppliers, distributors, and retailers, who in turn could experience cash flow problems, more costly or unavailable financing, credit defaults, and other financial hardships. This could lead to distributor or retailer destocking, increase our bad debt expense, or cause us to increase the levels of unsecured credit that we provide to customers. Other potential negative consequences to our business from poor economic conditions include higher interest rates, an increase in the rate of inflation, deflation, exchange rate fluctuations, or credit or capital market instability.

***There are doubts about our ability to continue as a going concern.***

The Company is an early-stage enterprise and has commenced principal operations. The Company had $4,427,967 in revenues and had net operating profit from operations of $498,524 for the year ended December 31, 2024. These factors raise substantial doubt about the Company's ability to continue as a going concern.

There can be no assurance that sufficient funds required during the next year or thereafter will be generated from operations or that funds will be available from external sources, such as debt or equity financings or other potential sources. The lack of additional capital resulting from the inability to generate cash flow from operations, or to raise capital from external sources would force the Company to substantially curtail or cease operations and would, therefore, have a material adverse effect on its business. Furthermore, there can be no assurance that any such required funds, if available, will be available on attractive terms or that they will not have a significant dilutive effect on the Company's existing stockholders.

The Company intends to overcome the circumstances that impact its ability to remain a going concern through a combination of the growth of revenues, with interim cash flow deficiencies being addressed through additional equity and debt financing. The Company anticipates raising additional funds through public or private financing, strategic relationships or other arrangements in the near future to support its business operations; however, the Company may not have commitments from third parties for a sufficient amount of additional capital. The Company cannot be certain that any such financing will be available on acceptable terms, or at all, and its failure to raise capital when needed could limit its ability to continue its operations. The Company's ability to obtain additional funding will determine its ability to continue as a going concern. Failure to secure additional financing in a timely manner and on favorable terms would have a material adverse effect on the Company's financial performance, results of operations and stock price and require it to curtail or cease operations, sell off its assets, seek protection from its creditors through bankruptcy proceedings, or otherwise. Furthermore, additional equity financing may be dilutive to the holders of the Company's common stock, and debt financing, if available, may involve restrictive covenants, and strategic relationships, if necessary, to raise additional funds, and may require that the Company relinquish valuable rights. Please see Financial Statements – Note 2. Going Concern for further information.

***Our growth is dependent on increasing sales, which, if unsuccessful, could limit our financial performance.***

Our ability to increase revenues from existing customers by identifying additional opportunities to sell more of our alcoholic beverage products, and our ability to obtain new customers, depends on a number of factors, including our ability to offer high quality products at competitive prices, the strength of our competitors and the capabilities of our sales and marketing departments. If we are not able to continue to increase sales from our existing customers or to obtain new customers in the future, we may not be able to increase our revenues and could suffer a decrease in revenues as well.

***There is no minimum capitalization required in this offering.***

We cannot assure that all or a significant number of the Shares consisting of common stock will be sold in this offering. Investors' subscription funds will be used by us as soon as they are received, and no refunds will be given if an inadequate amount of money is raised from this offering to enable us to conduct our business. Management has no obligation to purchase Shares. If we raise less than the entire amount that we are seeking in the offering, then we may not have sufficient capital to meet our operating requirements. We cannot assure that we could obtain additional financing or capital from any source, or that such financing or capital would be available to us on terms acceptable to us. Under such circumstances, investors in our Company could lose their investment in us. Furthermore, investors who subscribe for Shares in the earlier stages of the offering will assume a greater risk than investors who subscribe for Shares later in the offering as subscriptions approach the maximum amount.

***Global crises and geopolitical events that are beyond the Company's control, such as COVID-19, the Russo-Ukrainian War, and the Israel-Hamas War and uncertainly over the 2024 elections, can have a significant adverse effect on the business and revenue of the Company.***

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Drinking alcohol is a discretionary expenditure that historically has been influenced by domestic and global economic conditions. Unforeseeable and/or uncontrollable events, such as the outbreak of diseases like COVID-19, the conflict between Russia and Ukraine, the conflict between Israel and Hamas and the potential for domestic disturbances surrounding the 2024 election, have the potential to negatively impact the Company's business operations. The Company is vulnerable to the occurrence of unpredictable and uncontrollable events, including but not limited to earthquakes, power shortages, telecommunication failures, water scarcity, floods, food and grain shortages, supply chain issues, hurricanes, typhoons, fires, extreme weather conditions, war, medical epidemics, or pandemics (such as the COVID-19 outbreak), as well as other natural or manmade disasters or disruptions to business activities. The manifestation of any of these disruptive events could have serious repercussions on our operational efficiency and financial stability, and result in escalated costs and expenses, and could result in the weaking of consumer discretionary spending.

The risks associated with an epidemic, pandemic, or health crisis like COVID-19 could result in a decline and disruption in the travel and hospitality industries or an economic downturn. This would weaken consumer discretionary spending, which could influence off-premises dining, customer traffic in our restaurants, and the average bill amount, which in turn could have a material impact on our financial performance. Material changes to governmental policy related to domestic and international fiscal concerns, and/or changes in central bank policies with respect to monetary policy, also could affect consumer discretionary spending. Any of these additional factors affecting consumer discretionary spending may further influence customer traffic in our restaurants and the average bill amount, thereby potentially having a further material impact on our financial performance.

***The tequila segment of the spirits industry is subject to both state and federal regulatory authorities.***

The tequila segment of the spirits industry is subject to both state and federal regulatory authorities. Since the Company's products are imported from Mexico, there is risk of vulnerability if stringent trade or tariffs materially interrupt the Company's business model. The probability of such occurring is low due to the recently enacted United States-Mexico-Canada Trade Agreement, set to expire in 2036. Trade tensions between the United States and China have affected the Cost of Goods Sold for some of our Tequila and Spirit products due to an increased cost for bottle importation – however, even if trade from China to the United States is fully prohibited, the Company could still produce its bottles domestically.

***We determined the price of the Shares arbitrarily.***

The offering price of the Shares has been determined by management, and bears no relationship to our assets, book value, potential earnings, net worth or any other recognized criteria of value. We cannot assure that price of the Shares is the fair market value of the Shares or that investors will earn any profit on them.

***The offering price of the Company's Shares was not established on an independent basis; the actual value of your investment may be substantially less than what investor pays for the securities.***

The Company's Board of Directors established the Offering price of the Company's Shares on an arbitrary basis. The selling price of the Shares bears no relationship to the book or asset values or to any other established criteria for valuing Shares. Because the Offering price is not based upon any independent valuation, the Offering price may not be indicative of the proceeds that you would receive upon liquidation. Further, the Offering price may be significantly more than the price at which the Shares would trade if they were to be listed on an exchange or actively traded by broker-dealers.

**<u>Risks Relating to Our Financial Condition</u>**

***Our financials are not independently audited, which could result in errors and/or omissions in our financial statements if proper standards are not applied.***

Although the Company is confident with its accounting, we are not required to have our financials audited by a certified Public Company Accounting Oversight Board ("PCAOB"). As such, our accountants do not have a third party reviewing the accounting. Our accountants may also not be up to date with all publications and releases put out by the PCAOB regarding accounting standards and treatments. This could mean that our unaudited financials may not properly reflect up to date standards and treatments resulting misstated financials statements.

***Our management has limited experience operating a public company and are subject to the risks commonly encountered by early-stage companies.***

Although management of Stellar Spirits and Wines, Inc., has experience in operating small companies, current management has not previously had much experience managing expansion while being a public company. Many investors may treat us as an early-stage company. Because we have a limited operating history, our operating prospects should be considered in light of the risks and uncertainties frequently encountered by early-stage companies in rapidly evolving markets. These risks include:

&nbsp;&nbsp;&nbsp;&nbsp;· risks that we may not have sufficient capital to achieve our growth strategy;

· risks that we may not develop our products in a manner that enables us to maintain profitability and meet our customers' requirements;

· risks that our growth strategy may not be successful; and

· risks that fluctuations in our operating results will be significant relative to our revenues.

These risks are described in more detail below. Our future growth will depend substantially on our ability to address these and the other risks described in this section. If we do not successfully address these risks, our business could be significantly harmed.

***As a growing company, we have only this year achieved a profit and may not maintain profitability in the near future, if at all.***

We have just begun producing a net profit and we may not be able to remain profitable in the near future, if at all. While we expect our revenue to grow, we have only recently achieved profitability and cannot be certain that we will be able to sustain our current growth rate or realize sufficient revenue to continue to achieve profitability. Further, many of our competitors have a significantly larger user base and revenue stream but have yet to achieve and or maintain profitability. Our ability to continue as a going concern may be dependent upon raising capital from financing transactions, increasing revenue throughout the year and keeping operating expenses below our revenue levels in order to achieve positive cash flows, none of which can be assured.

***We are highly dependent on the services of our key executive, the loss of whom could materially harm our business and our strategic direction. If we lose key management or significant personnel, cannot recruit qualified employees, directors, officers, or other personnel or experience increases in our compensation costs, our business may materially suffer.***

We are highly dependent on our management, specifically Luis Cota. If we lose key management or employees, our business may suffer. Furthermore, our future success will also depend in part on the continued service of our management personnel and our ability to identify, hire, and retain additional key personnel. We do not carry "key-man" life insurance on the lives of any of our executives, employees or advisors. We experience intense competition for qualified personnel and may be unable to attract and retain the personnel necessary for the development of our business. Because of this competition, our compensation costs may increase significantly.

***We may not be able to compete successfully with other established companies offering the same or similar products and, as a result, we may not achieve our projected revenue and user targets.***

If we are unable to compete successfully with other businesses in our existing markets, we may not achieve our projected revenue and/or customer targets. We compete with both start-up and established companies. Compared to our business, some of our competitors may have greater financial and other resources, have been in business longer, have greater name recognition and be better established in our markets.

***Our lack of adequate D&O insurance may also make it difficult for us to retain and attract talented and skilled directors and officers.***

In the future we may be subject to additional litigation, including potential class action and stockholder derivative actions. Risks associated with legal liability are difficult to assess and quantify, and their existence and magnitude can remain unknown for significant periods of time. To date, we have not obtained directors and officers liability ("D&O") insurance. Without adequate D&O insurance, the amounts we would pay to indemnify our officers and directors should they be subject to legal action based on their service to the Company could have a material adverse effect on our financial condition, results of operations and liquidity. Furthermore, our lack of adequate D&O insurance may make it difficult for us to retain and attract talented and skilled directors and officers, which could adversely affect our business.

**<u>Risks Relating to our Common Stock and Offering</u>**

***We do not expect to pay dividends in the foreseeable future; any return on investment may be limited to the value of our common stock.***

We do not currently anticipate paying cash dividends in the foreseeable future. The payment of dividends on our common stock will depend on earnings, financial condition and other business and economic factors affecting it at such time as the board of directors may consider relevant. Our current intention is to apply net earnings, if any, in the foreseeable future to increasing our capital base and development and marketing efforts. There can be no assurance that the Company will ever have sufficient earnings to declare and pay dividends to the holders of our common stock, and in any event, a decision to declare and pay dividends is at the sole discretion of our board of directors. If we do not pay dividends, our common stock may be less valuable because a return on your investment will only occur if its stock price appreciates.

***This investment is illiquid***.

Our common stock is not currently quoted or public trading. As such there is no trading in the stock and no market for reselling these securities. If you decide that you want to resell these securities in the future, you may not be able to find a buyer. Although the Company intends to apply in the future for quotation of its common stock on a national exchange, over-the-counter market, or similar, exchange, there are a number of requirements that the Company may or may not be able to satisfy in a timely manner. Even if we obtain that quotation, we do not know the extent to which investor interest will lead to the development and maintenance of a liquid trading market. You should assume that you may not be able to liquidate your investment for some time or be able to pledge these shares as collateral.

***You will incur immediate and substantial dilution in the book value of your shares of Common Stock****.*

 

You will suffer immediate and substantial dilution in the net tangible book value of the shares of common stock that you receive in this Offering. See the section entitled "Dilution" for further information.

***Our issuance of additional shares of Common Stock, or options or warrants to purchase those shares, would dilute your proportionate ownership and voting rights.***

We are entitled under our articles of incorporation to issue up to 1,000,000,000 shares of common stock. We have issued and outstanding, as of December 31, 2025, 323,000,000 shares of common stock. Our board may generally issue shares of common stock, preferred stock, options, or warrants to purchase those shares, without further approval by our shareholders based upon such factors as our board of directors may deem relevant at that time. It is likely that we will be required to issue a large amount of additional securities to raise capital to further our development. It is also likely that we will issue a large amount of additional securities to directors, officers, employees and consultants as compensatory grants in connection with their services, both in the form of stand-alone grants or under our stock plans. We cannot give you any assurance that we will not issue additional shares of common stock, or options or warrants to purchase those shares, under circumstances we may deem appropriate at the time.

***The elimination of monetary liability against our directors, officers and employees under our Articles of Incorporation and the existence of indemnification rights to our directors, officers and employees may result in substantial expenditures by our company and may discourage lawsuits against our directors, officers and employees.***

Our Articles of Incorporation contains provisions that eliminate the liability of our directors for monetary damages to our company and shareholders. Our bylaws also require us to indemnify our officers and directors. We may also have contractual indemnification obligations under our agreements with our directors, officers and employees. The foregoing indemnification obligations could result in our company incurring substantial expenditures to cover the cost of settlement or damage awards against directors, officers and employees that we may be unable to recoup. These provisions and resulting costs may also discourage our company from bringing a lawsuit against directors, officers and employees for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our shareholders against our directors, officers and employees even though such actions, if successful, might otherwise benefit our company and shareholders.

***We may become involved in securities class action litigation that could divert management's attention and harm our business****.*

The stock market in general, and the shares of early-stage companies in particular, have experienced extreme price and volume fluctuations. These fluctuations have often been unrelated or disproportionate to the operating performance of the companies involved. If these fluctuations occur in the future, the market price of our shares could fall regardless of our operating performance. In the past, following periods of volatility in the market price of a particular company's securities, securities class action litigation has often been brought against that company. If the market price or volume of our shares suffers extreme fluctuations, then we may become involved in this type of litigation, which would be expensive and divert management's attention and resources from managing our business.

We may also from time to time make forward-looking statements about future operating results and provide some financial guidance to the public markets. Our management has limited experience as a management team in a public company and as a result, projections may not be made timely or set at expected performance levels and could materially affect the price of our shares. Any failure to meet published forward-looking statements that adversely affect the stock price could result in losses to investors, stockholder lawsuits or other litigation, sanctions or restrictions issued by the SEC.

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***Our stockholders may experience additional dilution due to convertible securities.***

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On June 26, 2025 and effective as of June 1, 2024, the Company amended its outstanding notes into a promissory note with Elite Beverage International, Inc. ("Elite"), in the amount of $3,953,470, the currently outstanding amount of debt owed to Elite by the Company (the "Note"). The Note was originally due on February 1, 2026, and the maturity date has since been extended to February 1, 2027. The Note has a principal rate of interest of 12% per annum if the Interest is paid in cash or at the rate of 15% per annum if the interest is paid in shares. The Note has a conversion feature; wherein, Elite may convert the note at any time after the issuance date of the note into shares at a fixed price of $0.50 per share. The Note contains standard terms of termination and is attached hereto as Exhibit 6.4.

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The Company plans on using some of the funds from this Offering to repay the Convertible Note. If the Company does not raise enough funds in this Offering, then the noteholder may convert the Convertible Note into Company shares, at the fixed price previously discussed, and would cause dilution to the Company's common stock. The note is convertible into shares of the Company's common stock either 1) at the option of the holders or 2) upon maturity. An additional 1,500,000 shares of Common Stock may be issued upon conversion and exercise could cause the market price of our Common Stock to decline. In addition, the securities convertible into equity securities would result in dilution of our existing stockholders' equity interest

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***As an issuer not required to make reports to the Securities and Exchange Commission under Section 13 or 15(d) of the Securities Exchange Act of 1934, holders of restricted shares may not be able to sell shares into the open market as Rule 144 exemptions may not apply.***

Under Rule 144 of the Securities Act of 1933, holders of restricted shares may avail themselves of certain exemptions from registration if the holder and the issuer meet certain requirements. As a company that is not required to file reports under Section 13 or 15(d) of the Securities Exchange Act, referred to as a non-reporting company, we may not, in the future, meet the requirements for an issuer under 144 that would allow a holder to qualify for Rule 144 exemptions. In such an event, holders of restricted stock would have to utilize another exemption from registration or rely on a registration statement to be filed by the Company registering the restricted stock. Although the Company currently plans to file either a Form 10 or S-1 with the Commission upon the conclusion of the Regulation A offering, there can be no guarantee that the Company will be able to fulfill one of these registration statements, which could have an adverse effect on our shareholders.

***We are classified as an "emerging growth company" as well as a "smaller reporting company" and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies will make our common stock less attractive to investors.***

We are an "emerging growth company," as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

Section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act.

We could remain an "emerging growth company" for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $1.07 billion as of the last business day of our most recently completed second fiscal quarter, and (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period.

Notwithstanding the above, we are also currently a "smaller reporting company." Specifically, similar to "emerging growth companies," "smaller reporting companies" are able to provide simplified executive compensation disclosures in their filings; are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial reporting; and have certain other decreased disclosure obligations in their SEC filings. Decreased disclosures in our SEC filings due to our status as an "emerging growth company" or "smaller reporting company" may make it harder for investors to analyze our results of operations and financial prospects.

 ***Although our management owns a meaningful number of shares of our common stock, our stockholders will have limited ability to influence the election of directors or the outcome of matters requiring stockholder approval.***

Our shareholders are not entitled to cumulative voting rights. Consequently, the election of directors and all other matters requiring shareholder approval will be decided by majority vote. Our officers and directors beneficially own shares of our common stock and, as a result, may have the ability to influence the outcome of matters submitted to a vote of stockholders. However, no officer or director individually controls a majority of our outstanding voting power.

In addition, sales of significant amounts of shares held by our directors, officers or affiliates, or the prospect of these sales, could adversely affect the market price of our common stock. The ownership of a substantial number of shares by certain stockholders may discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of us, which in turn could reduce our stock price or prevent our stockholders from realizing a premium over our stock price.

**<u>Risks Relating to Our Company and Industry</u>**

***We operate in a highly competitive environment, and if we are unable to compete with our competitors, our business, financial condition, results of operations, cash flows and prospects could be materially adversely affected.***

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We operate in a highly competitive environment. Our competition includes all other companies that are in the business of producing or distributing alcoholic beverage products. Many of our competitors have greater resources that may enable them to compete more effectively than us in the alcoholic beverage industry. Some of our competitors have a longer operating history and greater capital resources, facilities and product line diversity, which may enable them to compete more effectively in this market. Our competitors may devote their resources to developing and marketing products that will directly compete with our product lines. The Company expects to face additional competition from existing competitors and new market entrants. If a significant number of new entrants enters the market in the near term, the Company may experience increased competition for market share and may experience downward pricing pressure on the Company's products as new entrants increase production. Such competition may cause us to encounter difficulties in generating revenues and market share, and in positioning our products in the market. If we are unable to successfully compete with existing companies and new entrants to the market, our lack of competitive advantage will have a negative impact on our business and financial condition.

***We may not be able to manage future growth effectively.***

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If our business plan is successful, we will experience significant growth in a short period of time. Should we grow rapidly, our financial, management and operating resources may not expand sufficiently to adequately manage our growth. If we are unable to manage our growth, our costs may increase disproportionately, our future revenues may stop growing or decline, and we may face dissatisfied customers. Our failure to manage our growth may adversely impact our business and the value of your investment.

***We face substantial competition in the spirits industry and have limited financial resources compared to other competitors.***

We compete on the basis of product taste and quality, brand image, price, service and ability to innovate in response to consumer preferences. The global spirits industry is highly competitive and is dominated by several large, well-funded international companies. Many of our competitors have longer operating histories and have substantially greater financial, sales, marketing and other resources than we do, as well as larger installed customer bases, greater name recognition and broader product offerings. These large competitors can devote financial and other greater resources to the development, promotion, sale and support of their products. As a result, it is possible that our competitors may either respond to industry conditions or consumer trends more rapidly or effectively or resort to price competition to sustain market share, which could adversely affect our sales and profitability.

***We face unique risks relating to class actions or other litigation relating to alcohol abuse or the misuse of alcohol.***

Our industry faces the possibility of class action or similar litigation alleging that the continued excessive use or abuse of beverage alcohol has caused death or serious health problems or that we failed to adequately warn consumers of the risks of alcohol consumption. It is also possible that governments could assert that the use of alcohol has significantly increased government-funded healthcare costs. Litigation or assertions of this type have adversely affected companies in the tobacco industry, and it is possible that we, as well as our suppliers, could be named in litigation of this type.

Lawsuits have been brought in a number of states alleging that beverage alcohol manufacturers and marketers have improperly targeted underage consumers in their advertising. Plaintiffs in these cases allege that the defendants' advertisements, marketing and promotions violate the consumer protection or deceptive trade practices statutes in each of these states and seek repayment of the family funds expended by the underage consumers. While we have not been named in these lawsuits, we could be named in similar lawsuits in the future. Any class action or other litigation asserted against us could be expensive and time-consuming to defend against, depleting our cash and diverting our personnel resources and, if the plaintiffs in such actions were to prevail, our business could be harmed significantly.

**We face substantial regulatory risks including compliance with local and national laws, as well as the possibility of adverse changes in law, regulation or tax policy.**

Our business is subject to extensive government regulation. This includes regulations regarding production, distribution, marketing, advertising and labelling of beverage alcohol products. We are required to comply with these regulations and to maintain various permits and licenses. We are also required to conduct business only with holders of licenses to import, warehouse, transport, distribute and sell beverage alcohol products. We cannot assure you that these and other governmental regulations applicable to our industry will not change or become more stringent. Moreover, because these laws and regulations are subject to interpretation, we may not be able to predict when and to what extent liability may arise. Additionally, due to increasing public concern over alcohol-related societal problems, including driving while intoxicated, underage drinking, alcoholism and health consequences from the abuse of alcohol, various levels of government may seek to impose additional restrictions or limits on advertising or other marketing activities promoting beverage alcohol products. Failure to comply with any of the current or future regulations and requirements relating to our industry and products could result in monetary penalties, suspension or even revocation of our licenses and permits. Costs of compliance with changes in regulations could be significant and could harm our business, as we could find it necessary to raise our prices in order to maintain profit margins, which could lower the demand for our products and reduce our sales and increase our losses.

Also, the distribution of beverage alcohol products is subject to extensive taxation (at both the federal and state government levels), and beverage alcohol products themselves are the subject of national import and excise duties in most countries around the world. An increase in taxation or in import or excise duties could also significantly harm our sales revenue and margins, both through the reduction of overall consumption and by encouraging consumers to switch to lower-taxed categories of beverage alcohol.

***National and local governments may adopt regulations or undertake investigations that could limit our business activities or increase our costs.***

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Our business is subject to extensive regulatory requirements regarding production, exportation, importation, marketing and promotion, labeling, distribution, pricing, and trade practices, among others. Changes in laws, regulatory measures, or governmental policies, or the manner in which current ones are interpreted, could cause us to incur material additional costs or liabilities, and jeopardize the growth of our business in the affected market. Governments may prohibit, impose, or increase limitations on advertising and promotional activities or on the times or locations where alcoholic beverages may be sold or consumed, or may adopt other measures that could limit our opportunities to reach consumers or sell our products. Certain countries historically have banned all television, newspaper, magazine, and internet advertising for beverage alcohol products. Increases in regulation of this nature could substantially reduce consumer awareness of our products in the affected markets and make the introduction of new products more challenging.

Some countries where we do business have a higher risk of corruption than others. While we are committed to doing business in accordance with applicable anti-corruption and other laws, we remain subject to the risk that an employee will violate our policies, or that any of our many affiliates or agents may take an action determined to be in violation of international trade, money laundering, anti-corruption, or other laws, including the U.S. Foreign Corrupt Practices Act of 1977, or equivalent local laws. Any determination that our operations or activities are not, or were not, in compliance with U.S. or foreign laws or regulations could result in investigations, interruption of business, loss of business partner relationships, suspension or termination of licenses and permits (our own or those of our partners), imposition of fines, legal or equitable sanctions, negative publicity, and management distraction.

Additional regulation in the United States and other countries addressing climate change, use of water, land use and other environmental issues could increase our operating costs. Increasing regulation of fuel emissions could increase the cost of energy, including fuel, required to operate our facilities or transport and distribute our products, thereby substantially increasing the production, distribution, and supply chain costs associated with our products.

***Changes in federal, state, and local laws and government regulation could adversely impact our business.***

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The Company is subject to legislation and regulation at the federal, state, and local. In particular, the Company is subject to the rules and regulations of the Alcohol and Tobacco Tax and Trade Bureau. New laws and regulations may impose new and significant disclosure obligations and other operational, marketing and compliance-related obligations and requirements, which may lead to additional costs, risks of non-compliance, and diversion of our management's time and attention from strategic initiatives. Additionally, federal, state and local legislators or regulators may change current laws or regulations which could adversely impact our business. Further, court actions or regulatory proceedings could also change our rights and obligations under applicable federal, state, local and international laws, which cannot be predicted. Modifications to existing requirements or imposition of new requirements or limitations could have an adverse impact on our business.

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***We operate in a highly regulated environment, and if we are found to be in violation of any of the federal, state, or local laws or regulations applicable to us, our business could suffer.***

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We are subject to regulations promulgated by a variety of federal, state, and local regulatory authorities that govern the distribution of spirits, permitting, licensing, trade practices, advertising and marketing, distributor relationships, and various other matters. Our products are subject to alcoholic beverage control regulations that require us to apply for licenses that must be renewed annually and that may be revoked or suspended for cause at any time. We are currently selling all of our products with appropriate permits. A failure to retain a permit, or any other required license, or to continue to qualify for, or renew permits, could have a material adverse effect on operations and the Company's ability to obtain such a permit for our products.

Our failure to comply with such laws and regulations may cause regulatory authorities, such as the Alcohol and Tobacco Tax and Trade Bureau, to assess additional taxes, interest, or penalties, to impose significant fines, or to revoke our licenses or permits, thereby restricting our ability to conduct business.

***Changes in consumer spending could have a negative impact on our financial condition and business results.***

Alcohol sales depend upon a number of factors related to the level of consumer spending, including the general state of the economy, income tax rates, deductibility of business entertainment expenses under relevant tax laws and consumer confidence in future economic conditions. Changes in consumer spending in these and other areas can affect both the quantity and the price of spirits that customers are willing to purchase at restaurants or through retail outlets. Reduced consumer confidence and spending may result in reduced demand for our products, limitations on our ability to increase prices and increased levels of selling and promotional expenses. These circumstances would likely have a considerable negative impact upon our overall sales and gross margins.

***Adverse public opinion about alcohol may harm our business.***

Many studies conclude or suggest that alcohol consumption has no health benefits and may increase the risk of stroke, cancer and other illnesses. An unfavorable report on the health effects of alcohol consumption could significantly reduce the demand for spirits, which could harm our business by reducing sales and increasing expenses. In recent years, activist groups have used advertising and other methods to inform the public about the societal harms associated with the consumption of alcoholic beverages. These groups have also sought, and continue to seek, legislation to reduce the availability of alcoholic beverages, to increase the penalties associated with the misuse of alcoholic beverages or to increase the costs associated with the production of alcoholic beverages. Over time, these efforts could cause a reduction in the consumption of alcoholic beverages generally, which could harm our business by reducing sales and increasing expenses.

***Changes in the prices of supplies and raw materials could have a materially adverse effect on our business.***

There have been changes in the cost of raw materials used in the production of raw spirits in recent years. The increases in prices may also take place in the future and our inability to pass on increases to consumers could reduce our margins and profits and have a material adverse effect on our business. We cannot assure you that shortages or increases in the prices of our supplies or raw materials will not have a material adverse effect on our financial condition and results of operations.

***We may not be able to fully exploit newly developed or acquired brands.***

We intend to develop and to acquire, as may be possible, third-party brands. In our experience, not every brand deployment is successful. We may incur significant costs acquiring and promoting new brands, only to have limited market acceptance and limited resulting sales. If these circumstances occur, our financial results may be negatively impacted and we may determine it to be the best course of action to no longer support that brand.

***The Company faces significant competition in the United States.***

The Company faces significant competition in the United States tequila marketplace. According to data from the Consejo Regulador del Tequila (The Tequila Regulatory Council or "CRT") located in Mexico, and the tequila matchmaker database, there are around 2,270 registered tequila brands which translates to roughly over 4,000 different expressions of tequila certified to use the geographic indication "Tequila" see "Intellectual Property" below. Though some of these may not be imported to domestic markets, the number of tequilas imported and sold in the United States surely is close to such number. The result of this is a highly-saturated and competitive market. The Company may have difficulty increasing market share for our Comisario® Tequila, which may adversely affect revenues.

***A disruption in distillation or importation activities could have a material adverse effect.***

A prolonged disruption to distillation or importation activities (*e.g.*, due to fire, industrial action, adverse importation issues, or any other cause) at its distillation site(s) could have a material adverse effect on the Company's ability to produce its products. This could have a material adverse effect on the Company's consolidated financial results and on your investment.

***The Company and its distributors could have licensing, legal or regulatory problems.***

The Company or its distributors could lose their licenses to import or sell alcoholic beverages or have their hours of operation curtailed as a result of hearings of the licensing boards in jurisdictions where they are located or as a result of any changes in legislation governing licensing in the various jurisdictions with a material adverse effect on the Company's consolidated financial results and on your investment.

***Changes in consumer preferences and purchases, and our ability to anticipate or react to them, could negatively affect our business results.***

 ****

We are a branded consumer products company in a highly competitive market, and our success depends on our continued ability to offer consumers appealing, high-quality products. Consumer preferences and purchases may shift due to a host of factors, many of which are difficult to predict, including changes in economic conditions, demographic and social trends; public health policies and initiatives; changes in government regulation of alcoholic beverage products; the potential legalization of marijuana use on a more widespread basis within the United States or elsewhere; and changes in travel, leisure, dining, gifting, entertaining, and beverage consumption trends. Consumers may begin to shift their consumption and purchases of our premium and super-premium products, more commonly found in on-premise establishments, in favor of off-premise purchases. This includes consumption at home as a result of various factors, including shifts in social trends, proliferation of smoking bans, and stricter laws relating to driving while under the influence of alcohol. Shifts in consumption channels such as these could adversely impact our profitability. Consumers also may begin to prefer the products of competitors or may generally reduce their demand for brands produced by larger companies.

Over the past several years, the number of small, local distilleries in the United States has grown significantly. This is being driven by a trend of consumers showing increasing interest in locally produced regionally sourced products. The entry of additional competitive brands into the market may have a negative impact on the demand for our premium and super-premium brands. Moreover, we could experience unfavorable business results if we fail to attract consumers from diverse backgrounds and ethnicities in the United States and in our non-U.S. markets. Demographic forecasts in the United States in recent years indicate a slight decrease in the population segment aged 21 to 24; fewer potential consumers in this age bracket could have a negative effect on industry growth rates and our business. To continue to succeed, we must anticipate or react effectively to shifts in demographics, consumer behavior, consumer preferences, drinking tastes, and drinking occasions.

***Production facility disruption could adversely affect our business.***

 ****

Some of our largest brands are distilled at single locations. A catastrophic event causing physical damage, disruption, or failure at one of our major distillation or bottling facilities could adversely affect our business. Further, because whiskeys and some tequilas are aged for various, sometimes lengthy periods, there is a substantial inventory of aged and maturing products in warehouses at a number of different sites. The loss of a substantial amount of aged inventory—through fire, other natural or man-made disaster, contamination, or otherwise—could significantly reduce the supply of the affected product or products. A consequence of any of these or other supply or supply chain disruptions could result in our inability to meet consumer demand for the affected products for a period of time. In addition, insurance proceeds may be insufficient to cover the replacement value of our inventory of maturing products and other assets if they were to be lost. Disaster recovery plans may not prevent business disruption, and reconstruction of any damaged facilities could require a significant amount of time.

***The inherent uncertainty in supply/demand forecasting could adversely affect our business, particularly with respect to our aged products.***

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There is an inherent risk of forecasting imprecision in determining the quantity of aged and maturing products to produce and hold in inventory in a given year for future sale. The forecasting strategies we use to balance product supply with fluctuations in consumer demand may not be effective for particular years or products. For example, our Añejo tequila is aged for 23 months, making forecasts of demand for such a product in future periods subject to significant uncertainty. There is an inherent risk of forecasting error in determining the quantity of maturing stock to lay down in a given year for future consumption as a result of changes in business strategy, market demand and preferences, macroeconomic conditions, introductions of competing products, and other changes in market conditions. Any forecasting error could lead to our inability to meet the objectives of our business strategy, future demand, or lead to a future surplus of inventory and consequent write down in value of maturing stocks. If we are unable to accurately forecast demand for our products or efficiently manage its inventory, this may have a material adverse effect on our business and financial results. Further, we cannot be certain that we will be successful in using various levers, such as pricing changes, to create the desired balance of available supply and consumer demand for particular years or products. As a consequence, we may be unable to meet consumer demand for the affected products for a period of time. Furthermore, not having our products in the market on a consistent basis may adversely affect our brand equity and future sales.

***Higher costs or unavailability of materials could adversely affect our financial results, as could our inability to obtain certain finished goods or to sell used materials.***

 ****

Our products use materials and ingredients that we purchase from suppliers. Our ability to make and sell our products depends upon the availability of the raw materials, product ingredients, finished products, wood, glass and PET bottles, cans, bottle closures, packaging, and other materials used to produce and package them. Without sufficient quantities of one or more key materials, our business and financial results could suffer. For instance, only a few glass producers make bottles on a scale sufficient for our requirements, and only a single producer supplies most of our glass requirements. In addition, if there was a disruption in the supply of American oak logs to produce the new charred oak barrels in which we age our Reposado and Añejo tequilas, our production capabilities would be compromised. If any of our key suppliers were no longer able to meet our timing, quality, or capacity requirements, ceased doing business with us, or significantly raised prices, and we could not promptly develop alternative cost-effective sources of supply or production, our operations and financial results could suffer.

Higher costs or insufficient availability of suitable grain, agave, water, wood, glass, closures, and other input materials, or higher associated labor costs or insufficient availability of labor, may adversely affect our financial results because we may not be able to pass along the cost increases or the cost of such shortages through higher prices to customers without reducing demand or sales. Similarly, when energy costs rise, our transportation, freight, and other operating costs, such as distilling and bottling expenses, also may increase. Our financial results may be adversely affected if we are not able to pass along energy cost increases through higher prices to our customers without reducing demand or sales.

Weather, the effects of climate change, diseases, and other agricultural uncertainties that affect the mortality, health, yield, quality, or price of the various raw materials used in our products also present risks for our business, including in some cases potential impairment in the recorded value of our inventory. Changes in weather patterns or intensity can disrupt our supply chain as well, which may affect production operations, insurance costs and coverage, and the timely delivery of our products.

Water is an essential component of our products, so the quality and quantity of available water is important to our ability to operate our business. If droughts become more common or severe, or if our water supply were interrupted for other reasons, high-quality water could become scarce in some key production regions for our products, including Mexico.

***If the social acceptability of our products declines, or governments adopt policies disadvantageous to alcoholic beverages, our business could be adversely affected.***

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Our ability to market and sell our products depends heavily on societal attitudes toward drinking and governmental policies that both flow from and affect those attitudes. In recent years, increased social and political attention has been directed at the alcoholic beverage industry. For example, there remains continued attention focused largely on public health concerns related to alcohol abuse, including drunk driving, underage drinking, and the negative health impacts of the abuse and misuse of alcoholic beverages. While most people who drink enjoy alcoholic beverages in moderation, it is commonly known and well reported that excessive levels or inappropriate patterns of drinking can lead to increased risk of a range of health conditions and, for certain people, can result in alcohol dependence. Some academics, public health officials, and critics of the alcohol industry in the United States, Europe, and other parts of the world continue to seek governmental measures to make alcoholic beverages more expensive, less available, or more difficult to advertise and promote. If future high-quality scientific research indicated more widespread serious health risks associated with alcohol consumption—particularly with moderate consumption—or if for any reason the social acceptability of alcoholic beverages were to decline significantly, sales of our products could decrease.

***Significant additional labeling or warning requirements or limitations on the availability of our products could inhibit sales of affected products.***

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Various jurisdictions have adopted or may seek to adopt significant additional product labeling or warning requirements or limitations on the availability of our products relating to the content or perceived adverse health consequences of some of our products. Several such labeling regulations or laws require warnings on any product with substances that the state lists as potentially associated with cancer or birth defects. Our products already raise health and safety concerns for some regulators, and heightened requirements could be imposed. If additional or more severe requirements of this type become applicable to one or more of our major products under current or future health, environmental, or other laws or regulations, they could inhibit sales of such products.

***We face competition in our industry stemming from many new entrants into the alcoholic beverage business, consolidation among alcoholic beverage producers, wholesalers, and retailers, and changes to our route-to-consumer model, all of which could hinder the marketing, sale, or distribution of our products.***

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We use different business models to market and distribute our products in different geographic locations. In the United States, we sell our products either to distributors for resale to retail outlets or, in those states that control alcohol sales, to state governments that then sell them to retail customers and consumers. In our non-U.S. markets, we use a variety of route-to-consumer models—including, in many markets, reliance on others to market and sell our products. Consolidation among spirits producers, distributors, wholesalers, suppliers, or retailers could create a more challenging competitive landscape for our products. Consolidation at any level could hinder the distribution and sale of our products as a result of reduced attention and resources allocated to our brands both during and after transition periods, because our brands might represent a smaller portion of the new business portfolio.

Expansion into new product categories by other suppliers, or innovation by new entrants into the market, could increase competition in our product categories. For example, we are experiencing increased competition for some of our products from new entrants in the small-batch or craft spirits category. Changes to our route-to-consumer models or partners in important markets could result in temporary or longer-term sales disruption, could result in higher costs, and could negatively affect other business relationships we might have with that partner. Disruption of our distribution network or fluctuations in our product inventory levels at distributors, wholesalers, or retailers could negatively affect our results for a particular period. Further, while we believe we have sufficient scale to succeed relative to our major competitors, we nevertheless face a risk that continuing consolidation of large alcoholic beverage companies could put us at a competitive disadvantage. Our competitors may respond to industry and economic conditions more rapidly or effectively than we do. Other suppliers, as well as wholesalers and retailers of our brands, offer products that compete directly with ours for shelf space, promotional displays, and consumer purchases. Pricing (including price promotions, discounting, couponing, and free goods), marketing, new product introductions, entry into our distribution networks, and other competitive behavior by other suppliers, and by wholesalers and retailers, could adversely affect our sales, margins, and business and financial results. While we seek to take advantage of the efficiencies and opportunities that large retail customers can offer, they often seek lower pricing and purchase volume flexibility, offer competing own-label products, and represent a large number of other competing products. If the buying power of these large retail customers continues to increase, it could negatively affect our financial results.

***We might not succeed in our strategies for acquisitions and dispositions.***

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We seek to acquire or invest in additional brands or businesses. We expect to continue to seek acquisition and investment opportunities that we believe will increase long-term shareholder value, but we may not be able to find and purchase brands or businesses at acceptable prices and terms. Acquisitions involve risks and uncertainties, including potential difficulties integrating acquired brands and personnel; the possible loss of key customers or employees most knowledgeable about the acquired business; exposure to unknown liabilities; business disruption; and management distraction. Acquisitions, investments, or joint ventures could also lead us to incur additional debt and related interest expenses, issue additional shares, become exposed to contingent liabilities, and lead to dilution in our earnings per share and reduction in our return on average invested capital. We could incur future restructuring charges or record impairment losses on the value of goodwill or other intangible assets resulting from previous acquisitions, which may also negatively affect our financial results.

We also evaluate from time to time the potential disposition of assets or businesses that may no longer meet our growth, return, or strategic objectives. In selling assets or businesses, we may not get prices or terms as favorable as we anticipated. We could also encounter difficulty in finding buyers on acceptable terms in a timely manner, which could delay our accomplishment of strategic objectives. Expected cost savings from reduced overhead relating to the sold assets may not materialize, and the overhead reductions could temporarily disrupt our other business operations. Any of these outcomes could negatively affect our financial results.

 **

***Inadequate protection of our intellectual property rights could adversely affect our business prospects.***

 **

Our brand names, trademarks, and related intellectual property rights are critical assets, and our business depends on our protecting them on-line and in the countries where we do business. We may be unsuccessful in protecting our intellectual property rights in a given market or in challenging those who infringe our rights or imitate or counterfeit our products. Although we believe that our intellectual property rights are legally protected in the markets in which we do business, the ability to register and enforce intellectual property rights varies from country to country. In some countries, for example, it may be more difficult to successfully stop counterfeiting or look-alike products, either because the law is inadequate or because of judicial or administrative decisions that are arbitrary or unjust. We may not be able to register our trademarks in every country where we want to sell a particular product, and we may not obtain favorable decisions by courts or trademark offices.

***The Company needs to increase brand awareness.***

Due to a variety of factors, the Company's opportunity to achieve and maintain a significant market share may be limited. Developing and maintaining awareness of the Company's brand name, among other factors, is critical. Further, the importance of brand recognition will increase as competition in the Company's market increases. Successfully promoting and positioning the Company's brand, and products will depend largely on the effectiveness of the Company's marketing efforts. Therefore, the Company may need to increase the Company's financial commitment to creating and maintaining brand awareness. If the Company fails to successfully promote the Company's brand name or if the Company incurs significant expenses promoting and maintaining the Company's brand name, it would have a material adverse effect on the Company's consolidated results of operations.

***Product recalls or other product liability claims could materially and adversely affect our sales.***

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The success of our brands depends upon the positive image that consumers have of those brands. We could decide to, or be required to, recall products due to suspected or confirmed product contamination, product tampering, spoilage, or other quality issues. Any of these events could adversely affect our sales. Actual contamination, whether deliberate or accidental, could lead to inferior product quality and even illness, injury, or death to consumers, potential liability claims, and material loss. If a product recall became necessary, or if we voluntarily recall a product in the event of contamination, damage, or other quality issue, sales of the affected product or our broader portfolio of brands could be adversely affected. A significant product liability judgment or widespread product recall may negatively impact the sales and business and financial results of the affected brand or brands. Even if a product liability claim is unsuccessful or is not fully pursued, resulting negative publicity could adversely affect our reputation with existing and potential customers and our corporate and brand image.

***Litigation and legal disputes could expose our business to financial and reputational risk.***

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Major private or governmental litigation challenging the production, marketing, promotion, distribution, or sale of alcoholic beverages or specific brands could affect our ability to sell our products. Because litigation and other legal proceedings can be costly to defend, even actions that are ultimately decided in our favor could have a negative impact on our business reputation or financial results. Lawsuits have been brought against alcoholic beverage companies alleging problems related to alcohol abuse, negative health consequences from drinking, problems from alleged marketing or sales practices, and underage drinking. While these lawsuits have been largely unsuccessful in the past, others may succeed in the future. We could also experience employment-related class actions, environmental claims, commercial disputes, product liability actions stemming from a beverage or container production defect, a whistleblower suit, or other major litigation that could adversely affect our business results, particularly if there is negative publicity or to the extent the losses or expenses were not covered by insurance.

***Negative publicity could affect our stock value and business performance.***

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Unfavorable publicity, whether accurate or not, related to our industry or to us or our brands, marketing, personnel, operations, business performance, or prospects could negatively affect our corporate reputation, stock value, ability to attract high-quality talent, or the performance of our business. Adverse publicity or negative commentary on social media outlets, particularly any that go "viral," could cause consumers to react by avoiding our brands or choosing brands offered by our competitors, which could materially negatively affect our financial results.

***Inability to maintain and enhance product image.***

It is important that the Company maintains and enhances the image of its existing and new products. The image and reputation of the Company's products may be impacted for various reasons including litigation, complaints from regulatory bodies resulting from quality failure, illness or other health concerns. Such concerns, even when unsubstantiated, could be harmful to the Company's image and the reputation of its products. From time to time, the Company may receive complaints from customers regarding products purchased from the Company. The Company may in the future receive correspondence from customers requesting reimbursement. Certain dissatisfied customers may threaten legal action against the Company if no reimbursement is made. The Company may become subject to product liability lawsuits from customers alleging injury because of a purported defect in products or sold by the Company, claiming substantial damages and demanding payments from the Company. The Company is in the chain of title when it distributes products, and therefore is subject to the risk of being held legally responsible for them. These claims may not be covered by the Company's insurance policies. Any resulting litigation could be costly for the Company, divert management attention, and could result in increased costs of doing business, or otherwise have a material adverse effect on the Company's business, results of operations, and financial condition. Any negative publicity generated as a result of customer complaints about the Company's products could damage the Company's reputation and diminish the value of the Company's brand, which could have a material adverse effect on the Company's business, results of operations, and financial condition, as well as your investment. Deterioration in the Company's brand equity (brand image, reputation and product quality) may have a material adverse effect on its consolidated financial results as well as your investment.

***The tequila segment of the spirits industry is subject to both state and federal regulatory authorities.***

The tequila segment of the spirits industry is subject to both state and federal regulatory authorities. Since the Company's products are imported from Mexico, there is risk of vulnerability if stringent trade or tariffs materially interrupt the Company's business model. The probability of such occurring is low due to the recently enacted United States-Mexico-Canada Trade Agreement, set to expire in 2036.

***Regulatory and legal hurdles.***

The operation of a distillery and spirits importer, wholesale and retail distribution of spirits will be subject to obtaining a liquor license or other licensure in the countries and states in which such operations take place. An unanticipated delay or unexpected costs in obtaining or renewing such licenses, or unanticipated hurdles which have to be overcome or expenses which have to be paid, could result in a material adverse effect on the Company's business plan and consolidated financial results and on your investment.

***Our failure to attract or retain key executive or employee talent could adversely affect our business.***

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Our success depends upon the efforts and abilities of our senior management team, other key employees, and a high-quality employee base, as well as our ability to attract, motivate, reward, and retain them. Difficulties in hiring or retaining key executive or other employee talent, or the unexpected loss of experienced employees, could have an adverse impact on our business performance.

***Our revenues, operating results and cash flows are likely to fluctuate.***

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We experience fluctuations in our revenues, operating results and cash flows and expect that they will continue to occur in the future due to factors that are either within or outside of our control, including seasonality, and other general economic factors. We may also experience future fluctuations in our cash flows from operations because of increases in employee compensation, or hiring or retention payments or bonuses, which are paid throughout the year. In addition, the timing of future acquisitions and other investments and the cost of integrating them may cause fluctuations in our operating results and related cash flows.

***Our failure to appropriately and timely respond to changing consumer preferences and demand for new products and services could significantly harm our customer relationships and have a material adverse effect on our business, financial condition and results of operations.***

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Our business is subject to changing consumer trends and preferences. Our failure to accurately predict or react to these trends could negatively impact consumer opinion of us as a source for the latest products, which in turn could harm our customer relationships and cause us to lose market share. The success of our product offerings depends upon a number of factors, including our ability to:

&nbsp;&nbsp;&nbsp;&nbsp;· Anticipate customer needs, currently and in the future;

· Innovate and develop new products;

· Successfully introduce new products in a timely manner;

· Price our products competitively with retail and online competitors;

· Deliver our products in sufficient volumes and in a timely manner; and

· Differentiate our product offerings from those of our competitors.

If we do not differentiate our products, introduce new products or make enhancements to meet the changing needs of our customers in a timely manner, some of our products could be viewed as antiquated, which could have a material adverse effect on our financial condition and results of operations.

***Failure to successfully integrate acquired businesses and their products and other assets into our Company, or if integrated, failure to further our business strategy, may result in our inability to realize any benefit from such acquisition.***

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We expect to grow by acquiring relevant businesses, including other alcoholic beverage businesses. The consummation and integration of any acquired business, product or other assets into our Company may be complex and time consuming and, if such businesses and assets are not successfully integrated, we may not achieve the anticipated benefits, cost-savings or growth opportunities. Furthermore, these acquisitions and other arrangements, even if successfully integrated, may fail to further our business strategy as anticipated, expose our Company to increased competition or other challenges with respect to our products or geographic markets, and expose us to additional liabilities associated with an acquired business, technology or other asset or arrangement.

***We have limited supply sources, and price increases or supply shortages of key raw materials could materially and adversely affect our business, financial condition and results of operations.***

Our products are composed of certain key raw materials, such as agave, and water. If the prices of such raw materials increase significantly, it could result in a significant increase in our product development costs. If raw material prices increase in the future, we may not be able to pass on such price increases to our customers. A significant increase in the price of raw materials that cannot be passed on to customers could have a material adverse effect on our business, financial condition and results of operations.

The Company believes that its continued success will depend upon the availability of raw materials that permit the Company to meet its labeling claims and quality control standards. The supply of our agave, and water is subject to the same risks normally associated with agricultural production, such as climactic conditions, pollution, disease, insect infestations and availability of manual labor or equipment for harvesting. Any significant delay in or disruption of the supply of raw materials could substantially increase the cost of such materials, could require product reformulations, the qualification of new suppliers and repackaging and could result in a substantial reduction or termination by the Company of its sales of certain products, any of which could have a material adverse effect upon the Company. Accordingly, there can be no assurance that the disruption of the Company's supply sources will not have a material adverse effect on the Company.

***The Company relies on third parties to provide services essential to the success of our business.***

The Company relies on third parties to provide a variety of essential business functions for it, including manufacturing, shipping, accounting, legal work, public relations, advertising, retailing, and distribution. It is possible that some of these third parties will fail to perform their services or will perform them in an unacceptable manner. It is possible that Company will experience delays, defects, errors, or other problems with the third party's work that will materially impact Company's operations and may have little or no recourse to recover damages for these losses. A disruption in these key or other suppliers' operations could materially and adversely affect Company's business. As a result, your investment could be adversely impacted by Company's reliance on third parties and their performance.

***While we are attempting to generate sufficient revenues, our cash position may not be enough to support our daily operations.***

Management intends to raise additional funds by way of a public offering or additional private offerings, or by alternative methods. While we believe in the viability of our strategy to increase revenues and in our ability to raise additional funds, there can be no assurances to that effect. Our ability to continue as a going concern is dependent upon our ability to further implement our business plan, raise additional money, and generate sufficient revenues.

***We may be unable to keep pace with changes in the alcoholic beverage industries that we serve and advancements in technology as our business and market strategy evolves.***

As changes in the alcoholic beverage industries we serve occur or macroeconomic conditions fluctuate we may need to adjust our business strategies or find it necessary to restructure our operations or businesses, which could lead to changes in our cost structure, the need to write down the value of assets, or impact our profitability. We will also make investments in existing or new businesses, including investments in new products, technology and expansion of our business plans. These investments may have short-term returns that are negative or less than expected and the ultimate business prospects of the business may be uncertain.

As our business and market strategy evolves, we also will need to respond to technological advances and emerging industry standards in a cost-effective and timely manner in order to remain competitive, and produce better and more desirable products. The need to respond to technological changes may require us to make substantial, unanticipated expenditures. There can be no assurance that we will be able to respond successfully to technological change.

***Risks Relating to the Internet***

***We are dependent on our telephone, Internet and management information systems for the sales and distribution of our alcoholic beverage products.***

Our success depends, in part, on our ability to provide prompt, accurate and complete service to our customers on a competitive basis and our ability to purchase and promote our alcoholic beverage products, manage inventory, ship products, manage sales and marketing activities and maintain efficient operations through our telephone and management information system. A significant disruption in our telephone, Internet or management information systems could harm our relations with our customers and the ability to manage our operations. We can offer no assurance that our back-up systems will be sufficient to prevent an interruption in our operations in the event of disruption in our management information systems, and an extended disruption in the management information systems could adversely affect our business, financial condition and results of operations.

**Statements Regarding Forward-looking Statements**

**______**

This Disclosure Statement contains various "forward-looking statements." You can identify forward-looking statements by the use of forward-looking terminology such as "believes," "expects," "may," "will," "would," "could," "should," "seeks," "approximately," "intends," "plans," "projects," "estimates" or "anticipates" or the negative of these words and phrases or similar words or phrases. You can also identify forward-looking statements by discussions of strategy, plans or intentions. These statements may be impacted by a number of risks and uncertainties.

The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance taking into account all information currently available to us. These beliefs, assumptions and expectations are subject to risks and uncertainties and can change as a result of many possible events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements. You should carefully consider these risks before you make an investment decision with respect to our Securities. For a further discussion of these and other factors that could impact our future results, performance or transactions, see the section entitled "[Risk Factors](#a_006)."

**USE OF PROCEEDS**

__________

If we sell all of the Shares being offered, our net proceeds (after our estimated offering expenses of $19,000) will be $9,981,000. We will use these net proceeds for the following:

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| | | | | |
|:---|:---|:---|:---|:---|
| **Shares Offered (% Sold)** | **Shares Sold <br> (100%)** | **Shares Sold <br> (75%)** | **Shares Sold <br> (50%)** | **Shares Sold<br> (25%)** |
| **Gross Offering Proceeds** | $**10000000** | $**7500000** | $**5000000** | $**2500000** |
| *Approximate Offering Expenses <sup>(1)</sup>* |  |  |  |  |
| Misc. Expenses | 15000 | 15000 | 15000 | 15000 |
| Legal and Accounting | 45000 | 45000 | 45000 | 45000 |
| **Total Offering Expenses** | **60000** | **60000** | **60000** | **60000** |
| **Total Net Offering Proceeds** | **9981000** | **7481000** | **4981000** | **2481000** |
| *Principal Uses of Net Proceeds <sup>(2)</sup>* |  |  |  |  |
| Employee/ Independent Contractor Compensation<sup>(4)</sup> | 1435000 | 1200000 | 950000 | 500000 |
| Marketing for our alcoholic beverage products | 1050000 | 755000 | 525000 | 231000 |
| Distribution Prices Support | 1800000 | 1200000 | 900000 | 500000 |
| Legal & Accounting | 100000 | 100000 | 100000 | 100000 |
| Inventory | 2405000 | 2040000 | 1100000 | 650000 |
| Bottle Purchases | 1500000 | 1500000 | 1000000 | 500000 |
| General and Administrative Expenses | 150000 | 100000 | 75000 | 0 |
| Corporate Debt Reduction<sup>(3)</sup> | 500000 | 500000 | 300000 | 0 |
| **Total Principal Uses of Net Proceeds** | 8940000 | 7295000 | 4981000 | 2481000 |
| **Amount Unallocated** | 1041000 | 186000 | 0 | 0 |

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________________

(1) Offering
 expenses have been rounded to $19,000.

(2) Any
 line item amounts not expended completely shall be held in reserve as working capital and subject to reallocation to other line-item
 expenditures as required for ongoing operations.

(3) During our 2024 fiscal year, Elite advanced
 to us approximately $3.1 million (net of our repayments to Elite). This is in addition to the prior fiscal year's advances
 of approximately $800 thousand. The funds were advanced in connection with our acquisition of the Comisario brand from Elite. We
 used the advances for the purchase of raw materials and finished goods inventory, for sales and marketing expenses, for production
 of our products, and for general working capital purposes. As of December 31, 2024, we executed an unsecured, non-convertible two-year
 promissory note in Elite's favor in the initial principal amount of $3,163,783 that bears interest at the rate of 12% per annum
 with all principal and accrued and unpaid interest due at maturity. There is no prepayment penalty on the note. Elite
 is a third-party creditor of the Company. Further, Elite and we do not have any directors or executive officers in common. As further
 Described in Note 6 Notes Payable of our Financials. See "Note 6 Notes Payable." On June 26, 2025 and effective as of June
 1, 2024, the Company amended its outstanding notes into a promissory note with Elite Beverage International, Inc. ("Elite"),
 in the amount of $3,953,470, the currently outstanding amount of debt owed to Elite by the Company (the "Note"). The
 Note was originally due on February 1, 2026, and the maturity date has since been extended to February 1, 2027. The Note has a principal
 rate of interest of 12% per annum if the Interest is paid in cash or at the rate of 15% per annum if the interest is paid in shares.
 The Note has a conversion feature; wherein, Elite may convert the note at any time after the issuance date of the note into shares
 at a fixed price of $0.50 per share. The Note contains standard terms of termination and is attached hereto as Exhibit 6.4. As of
 December 31, 2025, the Note had not been converted into shares of the Company's common stock.

(4) If we raise 100% of this Offering we plan
 on using the compensation as follows: Engage Independent Contractor Sales Teams
 (approximately 4-5 Sales Teams; comprising 27 persons) $1,114,000 Independent Contractor Sales Team bonus accrual (for achieving
 or exceeding sales targets) $278,500.<br>
 As of this filing we do not have any ongoing plans or arrangements with our officers or directors for any proposed compensation.

The precise amounts that we will devote to each of the foregoing items, and the timing of expenditures, will vary depending on numerous factors.

As indicated in the table above, if we sell only 75%, or 50%, or 25% of the shares offered for sale in this offering, we would expect to use the resulting net proceeds for the same purposes as we would use the net proceeds from a sale of 100% of the Shares, and in approximately the same proportions, until such time as such use of proceeds would leave us without working capital reserve. At that point we would expect to modify our use of proceeds by limiting our research and development and marketing.

The expected use of net proceeds from this offering represents our intentions based upon our current plans and business conditions, which could change in the future as our plans and business conditions evolve and change. The amounts and timing of our actual expenditures, specifically with respect to working capital, may vary significantly depending on numerous factors. The precise amounts that we will devote to each of the foregoing items, and the timing of expenditures, will vary depending on numerous factors. As a result, our management will retain broad discretion over the allocation of the net proceeds from this offering.

In the event we do not sell all of the Shares being offered, we may seek additional financing from other sources in order to support the intended use of proceeds indicated above. If we secure additional equity funding, investors in this offering would be diluted. In all events, there can be no assurance that additional financing would be available to us when wanted or needed and, if available, on terms acceptable to us.

**DILUTION**

__________

If you purchase Shares in this offering, your ownership interest in our Common Stock will be diluted immediately, to the extent of the difference between the price to the public charged for each Share in this offering and the net tangible book value per share of our Common Stock after this offering.

An early-stage company typically sells its shares (or grants options over its shares) to its founders and early employees at a very low cash cost, because they are, in effect, putting their "sweat equity" into the company. When the company seeks cash investments from outside investors, like you, the new investors typically pay a much larger sum for their shares than the founders or earlier investors, which means that the cash value of your stake is diluted because all the shares are worth the same amount, and you paid more than earlier investors for your shares.

Our historical net tangible book value as of December 31, 2025, was $528,570 or $0.0016 per then-outstanding share of our Common Stock. Historical net tangible book value per share equals the amount of our total tangible assets less total liabilities, divided by the total number of shares of our Common Stock outstanding, all as of the date specified.

The following table illustrates the per share dilution to new investors discussed above, assuming the sale of, respectively, 100%, 75%, 50% and 25% of the Shares offered for sale at $2.00 in this offering (without deducting estimated offering expenses of $19,000):

If we Sell at $2.00 per Share for a total of 5,000,000 common shares:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Percentage of Shares offered that are sold** | **100%** | **75%** | **50%** | **25%** |
| Price to the public charged for each Share in this offering | $02.00 | $02.00 | $02.00 | $02.00 |
|  Historical net tangible book value per share as of December 31, 2025 (1) | (.0286) | (.0286) | (.0286) | (.0286) |
|  Increase in net tangible book value per share attributable to new investors in this offering (2) | (0.0305) | (0.0229) | (0.0153) | (0.0077) |
| Net tangible book value per share, after this offering | 0.0321 | 0.0246 | 0.0170 | 0.0093 |
| Dilution per share to new investors | 1.97 | 1.98 | 1.98 | 1.98 |

---

_______________

(1) Based on net tangible
 book value as of December 31, 2025, of $0.0016 and 323,000,000 outstanding shares of Common stock as of December 31, 2025.

(2) Without deducting estimated
 offering expenses of $19,000.

**Future dilution**

Another important way of looking at dilution is the dilution that happens due to future actions by the company. The investor's stake in a company could be diluted due to the company issuing additional shares. In other words, when the company issues more shares, the percentage of the company that you own will go down, even though the value of the company may go up. You will own a smaller piece of a larger company. This increase in number of shares outstanding could result from a stock offering (such as an initial public offering, another crowdfunding round, a venture capital round, angel investment), employees exercising stock options, or by conversion of certain instruments (e.g. convertible bonds, preferred shares or warrants) into stock.

If the company decides to issue more shares, an investor could experience value dilution, with each share being worth less than before, and control dilution, with the total percentage an investor owns being less than before. There may also be earnings dilution, with a reduction in the amount earned per share (though this typically occurs only if the company offers dividends, and most early-stage companies are unlikely to offer dividends, preferring to invest any earnings into the company).

The type of dilution that hurts early-stage investors most often occurs when the company sells more shares in a "down round," meaning at a lower valuation than in earlier offerings. An example of how this might occur is as follows (numbers are for illustrative purposes only):

&nbsp;&nbsp;&nbsp;&nbsp;· In June 2020 Maria invests $20,000 for shares that represent 2% of a company valued at $1 million.

· In December, the company is doing very well and sells $5 million in shares to venture capitalists on a valuation (before the new investment) of $10 million. Maria now owns only 1.3% of the company but her stake is worth $200,000.

· In June 2021, the company has run into serious problems and in order to stay afloat it raises $1 million at a valuation of only $2 million (the "down round"). Maria now owns only 0.89% of the company and her stake is worth only $26,660.

This type of dilution might also happen upon conversion of convertible notes into shares. Typically, the terms of convertible notes issued by early-stage companies provide that in the event of another round of financing, the holders of the convertible notes get to convert their notes into equity at a "discount" to the price paid by the new investors, i.e., they get more shares than the new investors would for the same price. Additionally, convertible notes may have a "price cap" on the conversion price, which effectively acts as a share price ceiling. Either way, the holders of the convertible notes get more shares for their money than new investors. In the event that the financing is a "down round" the holders of the convertible notes will dilute existing equity holders, and even more than the new investors do, because they get more shares for their money. Investors should pay careful attention to number of convertible notes that the company has issued (and may issue in the future, and the terms of those notes).

If you are making an investment expecting to own a certain percentage of the company or expecting each share to hold a certain amount of value, it's important to realize how the value of those shares can decrease by actions taken by the company. Dilution can make drastic changes to the value of each share, ownership percentage, voting control, and earnings per share.

**DISTRIBUTION**

__________

This Offering Circular is part of an Offering Statement that we filed with the SEC, using a continuous offering process. Periodically, as we have material developments, we will provide an Offering Circular supplement that may add, update or change information contained in this Offering Circular. Any statement that we make in this Offering Circular will be modified or superseded by any inconsistent statement made by us in a subsequent Offering Circular supplement. The Offering Statement we filed with the SEC includes exhibits that provide more detailed descriptions of the matters discussed in this Offering Circular. You should read this Offering Circular and the related exhibits filed with the SEC and any Offering Circular supplement, together with additional information contained in our annual reports, semi-annual reports and other reports and information statements that we will file periodically with the SEC. See the section entitled "Additional Information" below for more details.

**Subscription Price**

The Subscription Price is $2.00 per Share. The Subscription Price does not necessarily bear any relationship to our past or expected future results of operations, cash flows, current financial condition, or any other established criteria for value.

**Pricing of the Offering**

Prior to the Offering, there has been no public market for the Offered Shares. The public offering price was determined by the Company. The principal factors considered in determining the public offering price include:

&nbsp;&nbsp;&nbsp;&nbsp;· the information set forth in this Offering Circular and otherwise available;

· our history and prospects and the history of and prospects for the industries in which we compete;

· our past and present financial performance;

· our prospects for future earnings and the present state of our development;

· the general condition of the securities markets at the time of this Offering;

· the recent market prices of, and demand for, publicly traded common stock of generally comparable companies; and

· other factors deemed relevant by us.

**Offering Period and Expiration Date**

This Offering will start on or after the Qualification Date and will terminate on the earlier of (i) the date on which the Maximum Offering is sold, (ii) the third anniversary of the date of qualification of this offering statement; or (iii) when the Company elects to terminate the offering for any reason (in each such case, the "Termination Date") over a maximum period of 3 years, starting from the date of qualification of this Offering Statement. At least every 12 months after this offering has been qualified by the United States Securities and Exchange Commission (the "Commission"), the Company will file a post-qualification amendment to include the Company's recent financial statements.

**Procedures for Subscribing**

When you decide to subscribe for Offered Shares in this Offering, you should:

Contact us via phone or email.

1. Electronically receive, review, execute and deliver to us a subscription agreement; and

2. Deliver funds directly by, check, wire or electronic funds transfer via ACH to the specified account maintained by us.

Any potential investor will have ample time to review the subscription agreement, along with their counsel, prior to making any final investment decision. We shall only deliver such subscription agreement upon request after a potential investor has had ample opportunity to review this Offering Circular.

*Right to Reject Subscriptions*. After we receive your complete, executed subscription agreement and the funds required under the subscription agreement have been transferred to the escrow account, we have the right to review and accept or reject your subscription in whole or in part, for any reason or for no reason. We will return all monies from rejected subscriptions immediately to you, without interest or deduction.

*Acceptance of Subscriptions*. Upon our acceptance of a subscription agreement, we will countersign the subscription agreement and issue the Shares subscribed at closing. Once you submit the subscription agreement and it is accepted, you may not revoke or change your subscription or request your subscription funds. All accepted subscription agreements are irrevocable.

**No Escrow**

The proceeds of this offering will not be placed into an escrow account. We will offer the Shares on a best-efforts basis primarily through an online platform. As there is no minimum offering, upon the approval of any subscription to this Offering Circular, the Company shall immediately deposit said proceeds into the bank account of the Company and may dispose of the proceeds in accordance with the Use of Proceeds at Management's discretion.

**Other Selling Restrictions**

Other than in the United States, no action has been taken by us that would permit a public offering of our Common Stock in any jurisdiction where action for that purpose is required. Our Common Stock may not be offered or sold, directly or indirectly, nor may this Offering Circular or any other offering material or advertisements in connection with the offer and sale of shares of our Common Stock be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this Offering Circular are advised to inform themselves about and to observe any restrictions relating to this offering and the distribution of this Offering Circular. This Offering Circular does not constitute an offer to sell or a solicitation of an offer to buy our Common Stock in any jurisdiction in which such an offer or solicitation would be unlawful.

An investment in our Shares may involve significant risks. Only investors who can bear the economic risk of the investment for an indefinite period of time and the loss of their entire investment should invest in our Shares. See "[Risk Factors](#a_006)."

**Additional Information Regarding this Offering Circular**

We have not authorized anyone to provide information regarding this offering other than as set forth in this offering circular. Except as otherwise indicated, all information contained in this offering circular is given as of the date of this offering circular. Neither the delivery of this offering circular nor any sale made hereunder shall under any circumstances create any implication that there has been no change in our affairs since the date hereof.

From time to time, we may provide an "offering circular supplement" that may add, update or change information contained in this offering circular. Any statement that we make in this offering circular will be modified or superseded by any inconsistent statement made by us in a subsequent offering circular supplement. The offering statement we filed with the Commission includes exhibits that provide more detailed descriptions of the matters discussed in this offering circular. You should read this offering circular and the related exhibits filed with the Commission and any offering circular supplement together with additional information contained in other reports and information statements that we may file periodically with the Commission.

The offering circular and all supplements and reports that we have filed or will file in the future can be read on the Commission website at www.sec.gov.

**SELLING SECURITY HOLDERS**

__________

There are no selling security holders in this Offering.

**MANAGEMENT'S DISCUSSION AND ANALYSIS OF**

**FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

__________

*You should read the following discussion and analysis of our financial condition and results of our operations together with our consolidated financial statements and the notes thereto appearing elsewhere in this Offering Circular. This discussion contains forward-looking statements reflecting our current expectations, whose actual outcomes involve risks and uncertainties. Actual results and the timing of events may differ materially from those stated in or implied by these forward-looking statements due to a number of factors, including those discussed in the sections entitled "[Risk Factors](#a_006)", "[Cautionary Statement regarding Forward-Looking Statements](#a_002)" and elsewhere in this Offering Circular. Please see the notes to our Financial Statements for information about our Critical Accounting Policies and Recently Issued Accounting Pronouncements.*

**Management's Discussion and Analysis**

The Company has had revenues of $5,309,372 and $4,427,967 from operations in each of the last two fiscal years ending December 31, 2025, and December 31, 2024, respectively. We currently forecast that our revenues will continue to grow throughout the near future, due to continued Tequila demand, reduction in agave prices, and proposed our expansion into new markets. However, there can be no guarantee that any of the aforementioned positive attributes will occur or that we will be able to successfully take advantage of those positive market trends.

A current market overview according to a Forbes Magazine article from April 10, 2025, stated the following (abbreviated):

"the relentless rise of Tequila has been well-documented. According to the Distilled Spirits Council of the US (DISCUS), between 2004 and 2024, the volume of Tequila shipments to the United States increased by 271%, from approximately 8.67 million to 32.19 million 9-liter cases, an average annual increase of 6.86%. The revenue growth has been even more dramatic. Furthermore, 85% of the world's tequila is consumed in the US and Mexico – although IWSR forecasts a consumption decline in the latter – and, during 2023, tequila is expected to become the most valuable spirits sub-category in the US, overtaking vodka and US whiskey.

Several months ago, the Financial Times, echoed by the *Wall Street Journal* and other media worldwide, announced that "Mexico is sitting on more than half a billion liters of tequila in inventory, almost as much as its annual production," indicating a significant oversupply issue. However, according to the CRT, the amount of Tequila that would be considered surplus is even lower. Per the CRT:

*2023 and 2024 closed with practically the same volume of inventory, 525 and 522 million liters, respectively, of which almost 40% (195 million liters) is the product in the maturation process. An additional 38% (207.1 million liters) is Blanco Tequila. This category has the most significant sales volume.*

Tequila companies hold matured stock in steel tanks until it is bottled. This ensures consistency between bottlings. Typically, distillers hold extra quantities of Blanco Tequilas in stock because this category has the highest demand and because Blanco Tequila can be shifted back into oak casks to produce more aged Tequila as demand warrants.

The current uncertainty surrounding the imposition of tariffs on Tequila shipments from Mexico further clouds the picture. A 25% tariff would impact demand and reduce consumer sales. Even if the threatened tariffs are not implemented, the attempt by distributors and retailers to get ahead of them will distort the demand picture and result in a growth of on-hand stock inventories again. Wholesaler and retailer purchases of Tequila may increase in Q1-2025, not because consumer demand has increased, but because of inventory stocking in anticipation of tariffs.

The boom isn't over, but demand is resetting on a pre-COVID trendline or possibly lower, though still positive. That reset and those headwinds mean that producers face a much more competitive market and must work harder to grow their share! The easy growth is probably over, short-term, but the Tequila industry still has room to grow" https://www.forbes.com/

We plan for further offshore and overseas expansion, aiming to have our brands available in all 50 States in the United States of America and in 25 countries by year-end, which would potentially account for over 65% of our business in the next 12 months. Additionally, we intend to ship our overseas products directly from Mexico without tariffs. As of this offering, it is anticipated that Mexico will maintain its favored nation status concerning tariffs. If any tariffs are imposed, they will apply to all brands. These potential tariffs may be offset by the 83% reduction in the cost of agave over the past 24 months. Our ongoing need for bottles and raw materials will continue to constitute a significant portion of our budget and expenses. Marketing costs in the USA are expected to increase but will focus solely on social media, avoiding traditional TV, radio, billboards, and other high-cost, less impactful methods.

**Plan of Operation for the Next Twelve Months**

The Company believes that the proceeds of this Offering will satisfy its cash requirements for the next twelve months. To complete the Company's entire purchase and expansion of its tequila and spirit brands and conduct its business plan, it may have to raise additional funds in the next twelve months. Contemporaneously we will work with experts in the field to assist in the marketing of our spirits and wines.

Over the next twelve months, the Company plans to continue expanding its distribution network both domestically and internationally. The Company currently distributes its products in multiple U.S. states and in six international markets (Japan, Canada, Taiwan, Chile, Puerto Rico, and Costa Rica), and intends to expand into additional European and Asian markets during 2026. The Company will also focus on growing sales of the Marta – Leyenda De La Magia Tequila brand and on increasing market penetration for Comisario® Tequila and Yamazakura Whiskies. Marketing efforts will focus primarily on digital and social media channels.

The Company anticipates that cash generated from operations, together with proceeds from this Offering, will be sufficient to fund its operations and planned expansion for the next twelve months. The Company's operating expenses for the year ended December 31, 2025, were approximately $1,810,362, and the Company expects these costs to increase as it expands into additional markets.

The Company expects to increase the number of employees at the corporate level.

**Corporate Debt**

The debt to Elite occurred during our 2024 fiscal year, Elite advanced to us approximately $3.1 million (net of our repayments to Elite). This is in addition to the prior fiscal year's advances of approximately $800 thousand. The funds were advanced in connection with our acquisition of the Comisario brand from Elite. We used the advances for the purchase of raw materials and finished goods inventory, for sales and marketing expenses, for production of our products, and for general working capital purposes. On June 26, 2025, the Company amended its outstanding notes payable to Elite into a single promissory note in the amount of $3,953,470 (the "Note"), representing the full outstanding balance of advances made by Elite. During the year ended December 31, 2025, the Company made principal payments of $278,929, reducing the outstanding balance to $3,674,541 as of December 31, 2025.

On June 26, 2025 and effective as of June 1, 2024, the Company amended its outstanding notes into a promissory note with Elite Beverage International, Inc. ("Elite"), in the amount of $3,953,470, the currently outstanding amount of debt owed to Elite by the Company (the "Note"). The Note was originally due on February 1, 2026, and the maturity date has since been extended to February 1, 2027. The Note has a principal rate of interest of 12% per annum if the Interest is paid in cash or at the rate of 15% per annum if the interest is paid in shares. The Note has a conversion feature; wherein, Elite may convert the note at any time after the issuance date of the note into shares at a fixed price of $0.50 per share. The Note contains standard terms of termination and is attached hereto as Exhibit 6.4.

**Use of Estimates**

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include assumptions about collection of accounts and notes receivable, the valuation and recognition of stock-based compensation expense, the valuation and recognition of derivative liability, valuation allowance for deferred tax assets and useful life of fixed assets.

**RESULTS OF OPERATIONS**

 **Results for the Years Ended December 31, 2024, and December 31, 2025**

 **Operating Revenues**

The Company's revenues were $4,427,967 for the year ended December 31, 2024, compared to $5,309,372 for the year ended December 31, 2025, representing an increase of $881,405 or approximately 19.9%. The increase was driven by continued growth in domestic wholesale distribution of Comisario® Tequila and Yamazakura Whiskies, as well as expansion into international markets including Japan, Canada, Taiwan, Chile, Puerto Rico, and Costa Rica.

**Cost of Revenues**

Cost of revenues increased from $2,314,763 for the year ended December 31, 2024, to $2,454,905 for the year ended December 31, 2025, an increase of $140,142 or approximately 6.1%. The increase in cost of revenues reflects higher sales volume and product mix changes.

**Gross Profit**

Gross profit increased from $2,113,204 (47.7% margin) for the year ended December 31, 2024, to $2,854,467 (53.8% margin) for the year ended December 31, 2025. The improvement in gross margin was primarily attributable to reduced raw material costs and improved economies of scale.

**General and Administrative Expenses**

General and administrative expenses consisted primarily of consulting fees, professional fees, commissions, advertising, and transportation costs. For the year ended December 31, 2025, general and administrative expenses were $1,810,362, compared to $1,610,938 for the year ended December 31, 2024, an increase of $199,424. The increase was primarily attributable to higher commission expenses related to increased sales volume, advertising and marketing expenditures for brand expansion, and transportation costs associated with international distribution.

**Other Income (Expense)**

Other income (expense) consisted of interest expense on the Elite promissory note for the year ended December 31, 2025.

 **Net Income**

Net income for the year ended December 31, 2025, was $812,020, compared to net income of $498,524 for the year ended December 31, 2024. The increase of $313,496 reflects the Company's continued revenue growth and improved gross margins, partially offset by modest increases in general and administrative expenses.

**Liquidity and Capital Resources**

At December 31, 2025, the Company had total current assets of $4,771,011, consisting primarily of inventory of $2,202,582, accounts receivable of $2,515,733, and cash of $52,696. Total current liabilities were $579,050, resulting in positive working capital of $4,191,961. This represents a significant improvement from working capital of $3,010,772 as of December 31, 2024.

As of December 31, 2025, the Company had total assets of $4,782,161, consisting primarily of accounts receivable of $2,515,733, inventory of $2,202,582, and cash of $52,696. Long-term liabilities consisted of the Elite promissory note with a balance of $3,674,541. Total stockholders' equity was $528,570.

In 2024, the Company acquired the Comisario® brand and related inventory from Elite Beverage International, Inc. The parties initially entered into a Brand Purchase Agreement dated January 15, 2023 (filed hereto as Exhibit 6.5), which established the framework for the acquisition of the brand intellectual property, with certain terms including the purchase price and payment terms to be finalized. The transaction closed effective June 1, 2024 pursuant to an Asset Purchase Agreement (filed hereto as Exhibit 6.6), under which the parties finalized the consideration at 300,000,000 shares of common stock and the Company took delivery of the brand assets and related inventory. The inventory was recorded at its fair value of $2,951,250 based on the cost of the physical goods at the time of transfer. The Company's common stock has no established public trading market and the Company has not obtained a valuation of the brand that meets the fair value measurement standards required under ASC 820 for purposes of recording the asset under ASC 805-50. Accordingly, the share consideration was recorded at the fair value of the identifiable assets acquired, and no value was assigned to the intangible asset.

**Cashflow from Operating Activities**

During the year ended December 31, 2025, net cash used in operating activities was $133,667, compared to cash used in operating activities of $3,128,067 for the year ended December 31, 2024. The improvement was driven by the Company's profitable operations and improved working capital management.

**Cashflow from Investing Activities**

During the years ended December 31, 2024 and December 31, 2025, cash used in investing activities was $0.

**Cashflow from Financing Activities**

During the year ended December 31, 2025, the Company made principal payments of $278,929 on the Elite promissory note. During the year ended December 31, 2024, cash provided by financing activities was $3,163,783, primarily from the issuance of notes payable to Elite.

---

| | | |
|:---|:---|:---|
| *Working Capital* | **For the<br> year ended** <br> **December 31,** <br> **2025** <br> **$**  | **December 31,** <br> **2024** <br> **$**  |
| Cash | 52696 | 45864 |
| Current Assets | 4771011 | 3591928 |
| Current Liabilities | 579050 | 578658 |
| Working Capital (Deficit) | 4191961 | 3013270 |

---

---

| | | |
|:---|:---|:---|
| *Cash Flows* | **For the<br> year ended** <br> **December 31,** <br> **2025** <br> **$**  | **December 31,** <br> **2024** <br> **$**  |
| Cash Flows from (used in) Operating Activities | (133667) | (2466636) |
| Cash Flows from (used in) Investing Activities |  |  |
| Cash Flows from (used in) Financing Activities | 140499 | 2518279 |
| Net Increase (decrease) in Cash During Period | 6832 | 51643 |

---

*Going Concern*

The Company has attained profitable operations for both fiscal years 2024 and 2025, generating net income of $498,524 and $812,020, respectively. As of December 31, 2025, the Company had positive working capital of $4,191,961. The Company believes that cash generated from operations, together with proceeds from this Offering, will be sufficient to fund operations and planned expansion for at least the next twelve months.

**Trend Information**

**Trends**

Tequila consumption continues to surge to new heights. Specifically:

· In 2025 Additive-free
 tequila brands are demonstrating significantly higher growth rates than their counterparts, with some reports indicating double-digit
 growth while brands not certified additive-free range from double-digit down to plus 6% increase.

· In the US, tequila sales volume increased
 by 6.2% to 6.9 million nine-liter cases for the year ending December 31, 2024. Despite a slight overall decline in US spirits
 volumes, tequila sales saw growth. In December alone, tequila volume sales grew 5.8%

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· The global tequila market size was valued at USD
 18.36 Billion in 2024. Looking forward, IMARC Group estimates the market to reach USD 45.37 Billion by 2033, exhibiting a CAGR
 of 10.52% from 2025-2033. North America currently dominates the tequila market.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· In 2024 Tequila now commands 23.5% of
 all On Premise spirits sales volumes. This is a year-on-year increase of 0.8 percentage points, after tequila took share
 from other spirits categories.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· IWSR Drinks Market Analysis forecasts that tequila
 will overtake <u>vodka</u> to become the largest spirit category by value, both in the US and potentially globally. This
 shift is primarily driven by the increasing demand for <u>premium tequila</u> and the broader growth of the agave spirit
 category.

Due to the aforementioned factors, the Company believes that increased tequila consumption will continue to grow and shape the tequila market domestically and globally.

*Future Financings.*

We will continue to rely on equity sales of the Company's common shares in order to continue to fund business operations. Issuances of additional shares will result in dilution to existing shareholders. There is no assurance that the Company will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our business plan.

Since inception, we have financed our cash flow requirements through issuance of common stock and loans to related and third parties. As we expand our activities, we may, and most likely will, continue to experience net negative cash flows from operations, pending receipt of revenues. Additionally, we anticipate obtaining additional financing to fund operations through common stock offerings, to the extent available, or to obtain additional financing to the extent necessary to augment our working capital. In the future we will need to generate sufficient revenues from sales in order to eliminate or reduce the need to sell additional stock or obtain additional loans. There can be no assurance we will be successful in raising the necessary funds to execute our business plan.

We anticipate that we will incur operating losses in the next twelve months. Our lack of operating history makes predictions of future operating results difficult to ascertain. Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development, particularly companies in new and rapidly evolving markets. Such risks for us include, but are not limited to, an evolving and unpredictable business model and the management of growth.

To address these risks, we must, among other things, obtain a customer base, implement and successfully execute our business and marketing strategy, continually develop and upgrade our business model, alcoholic beverage products and branding, respond to competitive developments, and attract, retain and motivate qualified personnel. There can be no assurance that we will be successful in addressing such risks, and the failure to do so can have a material adverse effect on our business prospects, financial condition and results of operations.

*Critical Accounting Policies.*

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

Management regularly evaluates the accounting policies and estimates that are used to prepare the financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

*Off-Balance Sheet Arrangements*

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

*Recently Issued Accounting Pronouncements*

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

**Quantitative and Qualitative Disclosures about Market Risk**

In the ordinary course of our business, we are not exposed to market risk of the sort that may arise from changes in interest rates or foreign currency exchange rates, or that may otherwise arise from transactions in derivatives.

**Contingencies**

Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company's management, in consultation with its legal counsel as appropriate, assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company, in consultation with legal counsel, evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company's financial statements. If the assessment indicates a potentially material loss contingency is not probable, but is reasonably possible, or is probable, but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

**Relaxed Ongoing Reporting Requirements**

Upon the completion of this Offering, we may elect to become a public reporting company under the Exchange Act. If we elect to do so, we will be required to publicly report on an ongoing basis as an "emerging growth company" (as defined in the Jumpstart Our Business Startups Act of 2012, which we refer to as the JOBS Act) under the reporting rules set forth under the Exchange Act. For so long as we remain an "emerging growth company", we may take advantage of certain exemptions from various reporting requirements that are applicable to other Exchange Act reporting companies that are not "emerging growth companies", including but not limited to:

&nbsp;&nbsp;&nbsp;&nbsp;· not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

· taking advantage of extensions of time to comply with certain new or revised financial accounting standards;

· being permitted to comply with reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and

· being exempt from the requirement to hold a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

We expect to take advantage of these reporting exemptions until we are no longer an emerging growth company. We would remain an "emerging growth company" for up to five years, although if the market value of our Common Stock that is held by non-affiliates exceeds $700 million as of any June 30 before that time, we would cease to be an "emerging growth company" as of the following June 30.

If we elect not to become a public reporting company under the Exchange Act, we will be required to report on an ongoing basis under the reporting rules set forth in Regulation A for Tier 1 issuers. The ongoing reporting requirements under Regulation A are more relaxed than for "emerging growth companies" under the Exchange Act. The differences as a Tier 1 issuer include, but are not limited to, being required to file only an exit report, rather than annual, semi-annual, or quarterly reports. Annual reports for reporting companies are due within 120 calendar days after the end of the issuer's fiscal year, and semi-annual reports for Tier 2 issuers are due in 90 calendar days after the end of the first six months of the issuer's fiscal year.

In either case, we will be subject to ongoing reporting requirements that are less rigorous than Exchange Act rules for companies that are not "emerging growth companies", and our stockholders could receive less information than they might expect to receive from more mature companies.

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**<u>Corporate History</u>**

Stellar Spirits and Wines, Inc., ("Stellar Spirits," "Company," "we" or "us") was incorporated on July 9th, 2021, in the State of California. We are a California-based producer, importer, distributor and marketer of premium brand spirits. In 2023, we acquired the Tequila Comisario® brand and also have exclusive North American and Chinese distribution rights to Yamazakura Japanese Whiskies and Sakes, Marta Tequila and plan on adding more during the fiscal year ending 2026. We seek to be a leader in providing spirits that offer a better experience than comparable spirits.

**BUSINESS**

__________

*The following description of our business contains forward-looking statements relating to future events or our future financial or operating performance that involve risks and uncertainties, as set forth above under "Special Note Regarding Forward-Looking Statements." Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors described in the Offering Circular, including those set forth above in the Special Cautionary Note Regarding Forward-Looking Statements or under the heading "[Risk Factors](#a_006)" or elsewhere in this Offering Circular.*

**Our Business Overview**

We are a California-based producer, importer, distributor and marketer of premium brand spirits. We own the Comisario® tequila brand and also have exclusive North America and Chinese distribution rights to Yamazakura Whiskies and Sakes, Marta Tequila, and forthcoming Mezcal brands. We seek to be a leader in providing spirits that offer a better experience than comparable spirits.

In 2023, the Company entered into a brand purchase transaction pursuant to which it acquired the Comisario® brand. In connection with that transaction, and through subsequent intellectual property assignments, the Company acquired the trademarks and related intellectual property associated with the Comisario® brand. The Company does not own manufacturing facilities and relies on third-party distilleries and contract manufacturers for production.

Stellar Spirits & Wines Inc., owns the global brand rights, trademark, proprietary recipes, and contractual manufacturing arrangements for Tequila Comisario® Ultra Premium 100% Pure Blue Weber Agave. Stellar Spirits & Wines Inc., believes that its Tequila Comisario® is objectively superior in quality and taste than other spirits. We believe that through cost effective manufacturing, our exclusive and distinctive recipe that we will be able to profitably distribute the product world-wide with sustainable and scalable operational capacity in place to generate annual growth and profitability, to nurture the communities, customers and environment in which we operate.

We plan to provide a selection of the finest spirits and wines to distributors in the United States, Canada, Europe, United Kingdom, United Arab Emirates and Asia increasing our annual revenue annually and product catalogue consistently.

Stellar Spirits & Wines Inc., was founded by Luis Cota a leader in the beverage, entertainment, hospitality, marketing and ultra premium spirit industries. It is our goal to build the premium brand into a global sensation through our established distribution network, celebrity influencer's and ambassadors and our investment into an innovative sales & marketing strategy. Our products have a passionate and notable following, and are well received. We will build culturally relevant brand stories and build authentically crafted products to add to the product catalogue. We believe that our innovative marketing strategies will drive increased sales, retail partnerships, collaborations, influence and affluence to build a business model and brands that stand the test of time and rise above the crowd.

We believe that we will effectively compete on the basis of quality, price, brand recognition and distribution strength. Our premium brands will compete with other alcoholic and nonalcoholic beverages for consumer purchases, retail shelf space, restaurant presence and wholesaler attention. We plan to compete with numerous multinational producers and distributors of beverage alcohol products.

By focusing on the premium and super-premium segments of the market, which typically have higher margins, we believe we will be able to gain relatively significant attention from our customers and distributors for a company of our size. In addition, the continued consolidation among the major companies is expected to create an opportunity for small to mid-size wine and spirits companies, as the major companies contract their portfolios to focus on fewer brands.

**Brand Owner/Importer**

 ****

*Comisario® Tequila*

Our flagship brand, Comisario® Ultra Premium Tequila, is 100% Blue Weber Agave tequila from the highlands of Jalisco, Mexico. Comisario® is one of the highest-awarded tequilas, winning US and international competitions, including multiple Gold and Double-Gold medals, Best of Class, Tequila of the Year, 98-point ratings and is/was ranked #2 Blanco and #3 Añejo in the "World Spirits Competition" recently announced by *Cigar and Spirits* Magazine. See **Exhibit 6.1** for more information about awards and rankings.

We offer our Comisario® tequila in four varieties:

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&nbsp;&nbsp;&nbsp;&nbsp;• *Blanco:* Blanco tequila is the blue agave spirit in its purest form. It is clear and typically un-aged,
where the true flavors and the intensity of the agave are present, as well as the natural sweetness. It can be bottled directly after
distillation or stored in stainless steel tanks to settle for up to 4 weeks.

&nbsp;&nbsp;&nbsp;&nbsp;• *Reposado:* A Reposado tequila is the first stage of "rested and aged." The tequila is
aged in wood barrels or storage tanks between two months and eleven months. The spirit takes on a golden hue, and the taste becomes a
good balance between the agave and wood flavors. Many different types of wood barrels are used for aging, with the most common being American
or French oak. Some tequilas are aged in previously used bourbon/whiskey, cognac, or wine barrels and will inherit unique flavors from
the previous spirit. Comisario® Reposado is aged in American whiskey barrels for seven months.

&nbsp;&nbsp;&nbsp;&nbsp;• *Añejo:* After aging for at least one year, tequila can be classified as an "Añejo."
The distillers are required to age Añejo tequila in barrels that do not exceed 600 liters or approximately 159 gallons. The aging
process darkens the tequila to an amber color, and the flavor can become smoother, richer, and more complex. Our Comisario® Añejo
is aged in American whiskey barrels for 23 months.

&nbsp;&nbsp;&nbsp;&nbsp;• *Extra Añejo.* Legally requiring 3 years of Aging, our current Extra Añejo is aged
for 7 years and the upcoming 1<sup>st</sup> qtr. 2024 release will be aged 9 years.

The Company's tequila products are manufactured at Casa Tequilera de Arandas Distillery, situated within Jalisco, Mexico – a province renowned for the production of a Mexican national resource, agave tequila. Comisario® has been certified by the province of Jalisco to use the geographic distinctions of "Tequila" and/or "Tequila 100% De Agave" and continues to maintain such standards. See "[Intellectual Property](#intellprop)" for further details.

**Yamazakura Whiskies and Sasanokawa Sakes**

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Japanese Whiskies are reputed to be the pinnacle of quality and craftsmanship in the Whisky world. A 10 generation old Distillery in Japan, Yamazakura provides the "top" of the category for our entry in this category. Their Sakes have been tasted by multiple industry experts / personnel and received glowing remarks. Whiskies, along with Tequilas are at the very top of the "Brown Spirits" revolution taking over the world.

One of the defining aspects of Yamazakura Whisky is the environment in which it's crafted. The winds that blow down from Mt. Bandai, along with the seasonal shifts in temperature and humidity, play a critical role in shaping the whisky's flavor profile. These natural factors create the perfect conditions for slow, careful aging, imparting subtle complexities to the whisky as it matures. The result is a spirit that not only captures the essence of Japanese whisky-making but also reflects the natural beauty and character of the Koriyama region. We then carefully blend a fine selection of world whiskies and single malt which adds to the connection with the natural elements of Koriyama, Yamazakura offers an experience that is both elegant and deeply nuanced.

Sasanokawa's dedication to small-batch production allows the distillery to focus on quality over quantity, setting it apart from other whisky producers. Each batch of Yamazakura is crafted in limited quantities, allowing the distillers to carefully monitor every step of the process. This hands-on approach ensures that each bottle meets the company's exacting standards, resulting in a whisky that offers a distinct, refined flavor with every sip.

**Mezcal**

Stellar Spirits will have 2 entries in this fast growing category. Also agave driven, permitted to be produced in 9 Mexican states and using up to 25 different styles of agave, Mezcals have rocketed in popularity in the past year to become a 2 million case category, with no signs of slowing its growth.

**<br> Distribution Strategy and Agreements**

On February 25, 2025, the Company and Aragophene, Inc., entered into an extension agreement of the 2023 agreement to the Exclusive Distribution Agreement for the exclusive distribution rights to Yamazakura Whiskies and Sasanokawa sake (the "Yamazakura Agreement"). As per the Yamazakura Agreement the Company agrees to make its best efforts to develop the largest possible market for the [Yamazakura] Products in the Territory and shall continuously offer advertise, demonstrate and otherwise promote the sale of Products in the Territory. Best efforts are defined as selling a minimum of 50,000 bottles of Yamazakura blended whiskey, 300 bottles of Asaka single malt whiskey, and 12,000 bottles of Sasanokawa sake. The Territory is defined as North America and the Caribbean, along with all markets outside of Japan for Stellar branded products including but not limited to Overture Blended Whisky, with the potential for expansion of the Territory. The term of the Yamazakura Agreement is one year, and at the beginning of each subsequent year hereunder the parties will consult together in good faith and agree on the Annual Market Potential applicable to that year; provided, however, that if they cannot agree, the Annual Market Potential for the immediately Preceding year will apply to the current year with an increase of 15% in volume. The Yamazakura Agreement will automatically renew annually for five years provided that the Distributor meets its annual targets with annual growth of 15% during the five-year period.

The foregoing description of the Yamazakura Agreement does not purport to be complete and is qualified in its entirety by reference to the complete text of such agreement, which is filed hereto as Exhibit 6.2, to our Regulation A Offering, and is incorporated herein by reference.

In addition to our role as a brand owner, importer, and marketer, we have selectively chosen specific markets in which to be a distributor, such as California.

We describe below how we have developed our role as a distributor by working with wholly owned distributors and/or joint ventures in a few key domestic and international markets:

 

 *On July 1, 2024, the Company entered into a one-year sales and marketing agreement with First Step Beverage, Inc. ("First Step"), pursuant to which First Step provided nationwide sales coverage for the Company's Comisario® Tequila and Yamazakura Whiskies through a network of over one hundred distributors' sales personnel. The agreement required the Company to pay First Step $47,500 per month and provided for bonus payments of up to $220,000 based on achievement of sales goals, as well as up to 250,000 shares of restricted stock based on the same goals. The agreement expired on July 1, 2025 and was not renewed. The Company currently manages its sales and distribution relationships directly. The foregoing description of the First Step Beverage Agreement does not purport to be complete and is qualified in its entirety by reference to the complete text of such agreement, which is filed hereto as Exhibit 6.3, to our Regulation A Offering, and is incorporated herein by reference.*

Our products are now placed for sale in 42 states through our Distributor network and their direct Sales Personnel.

The following are some of our recent highlights:

*Las Vegas, Nevada/Phoenix, Arizona*: We have agreements with distributors in both states, allowing us to penetrate the markets in each.

*New York/New Jersey/Connecticut Tri State*: We currently have relationships with several operators. Tri-Vin's operators cover New York and New Jersey (our #1 market), and Hartley & Parker operators cover Connecticut.

 

***Multi State agreements with the 3 leading National Distributors:***

 ****

&nbsp;&nbsp;&nbsp;&nbsp;· Southern Glaser Wine and Spirits

&nbsp;&nbsp;&nbsp;&nbsp;· RNDC (Republic National Distributing Co.)

&nbsp;&nbsp;&nbsp;&nbsp;· Breakthru Beverages

As well as a carefully created association with leading Craft Distributors across the country.

**Tequila Market**

The domestic and global tequila market has exploded within the past four years. According to Grand View Research the global tequila market size was estimated at USD 10.53 billion in 2023 and is projected to grow at a CAGR of 9.5% from 2024 to 2030. A significant driver is the increasing demand for premium and artisanal tequila. Consumers are shifting their focus toward quality over quantity, with many willing to pay more for high-quality, 100% agave tequilas. This trend is particularly pronounced among younger consumers, with 54% of those aged 18-34 preferring premium ones. The premium segment is projected to grow substantially, contributing significantly to revenue growth in the industry.

Tequila is today the #1 profit contributor in the Spirits category and outgrowing all other Spirit categories. This included a comparable growth in the high-end/ultra-premium segment of the tequila market. The Company predicts the growth trend of the high-end/ultra-premium tequila segment to continue for the foreseeable future, correlating with the greater tequila market trends. The Company believes that it is particularly well-positioned to capitalize on this segment's growth due to the already high reputation of Comisario® tequilas in the ultra-premium tequila category.

**Industry Trend Information**

Tequila consumption continues to surge to new heights. According to www.ParkStreet.com ("ParkStreet"), tequila in the U.S. is currently led by mainstay brands such as Jose Cuervo, Patron, Casamigos, Don Julio, and 1800, but high-growth brands like Lunazul, Milagro, Mi Campo, and Gran Coramino are pushing the category forward. Each of these high-growth brands saw their 9-liter case volumes grow by at least 28% from 2022 to 2023, with 400 Conejos Mezcal leading at 75.9% growth in that timeframe.

The states responsible for the highest sales of 9L cases of tequila are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· California – 6.3 million cases

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Texas – 3.7 million cases

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Florida – 1.8 million cases

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Illinois – 1.1 million cases

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Arizona – 1.1 million cases

The states and territories responsible for selling the most tequila cases per capita included:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Nevada – 298.0 per 1,000 adults

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· California – 220.2 per 1,000 adults

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Colorado – 202.3 per 1,000 adults

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Arizona – 197.8 per 1,000 adults

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Texas – 173.0 per 1,000 adults

Due to the aforementioned factors, the Company believes that increased consumption of tequila will continue to grow and shape the tequila market domestically and globally. The Company also believes that selling its premium products will differentiate it from the competition.

ParkStreet further stated that while a consumer preference for trading up to higher price tiers within spirits has been well-documented across categories, this trend is particularly evident within tequila. In 2023, 27.3% of Supplier Gross Revenues for Tequila/Mezcal was Premium ($100 to $175), 19.5% was High-End Premium ($175 to $255), and 48.2% was Super Premium ($255+), per the Beverage Information Group.

This increase is partially due to increased demand for añejo and extra añejo tequilas, aged for longer periods in oak barrels, as well as single-barrel aged tequilas. Consumers are now consistently trading up to fine and rare sipping tequilas, treating the category much like they treat whiskey due to the nuance and complexities attained through the aging process.

The bars and nightclubs market, severely impacted by COVID-19, saw significant recovery beginning in 2021 and continuing into 2022 and 2023. While on-premise sales have rebounded, they remain slightly below pre-pandemic levels. However, the market is showing a positive trend with increasing consumer confidence and spending in these establishments (Spirits Council).

Overall, the spirits industry and hospitality sector are on a positive trajectory, driven by consumer preferences for high-end products and an improving economic environment. This recovery and growth present robust opportunities for strategic expansion and investment in new properties.

**Manufacturing:** 

Tequila, like Cognac, Champagne, Bordeaux, Scotch has a legally protected "appellation" where nowhere else in the world the Blue Weber Agave can be produced, Processed, distilled and finished, giving it the exclusivity and profit that no other can access. Mexico has agreements with 187 countries to legally respect the appellation.

**Our Process:** 

The Highlands of Jalisco, and within it The Golden Triangle (of Tepatitlan, Arandas and Atotonilco) are now being compared to the "Petite Cognac" growing region of Cognac France. Such is the quality being produced there. While the process is typical (harvesting / cooking / fermenting / distilling / barrel aging), Comisario® Tequila goes through additional steps that are critical in it having become the most awarded Tequila since its release – Harvesting at 6 to 7 years of age, with higher sugar and lower acids (most commercial brands harvest at 4.5 to 5 years of age. Oxygenation for 36 hours giving it the softer more approachable palate feel without losing the inherent quality of agave pepper, spice and earthiness, and finally a unique barrel aging program allowing us to properly round our the balance between fruit and wood.

**Current and Future Markets:**

In the United States we plan on expanding to four more States (Louisiana, Washington, New Mexico and Oklahoma) in the next ninety days to bring the total number of states that we are distributing for, to a total of 46 States.

Currently our brands are available in the following foreign countries: Japan, Canada, Taiwan, Chile, Puerto Rico, and Costa Rica. We are planning to expand to Europe (Netherlands, Belgium, Luxembourg, Germany, France, Italy, Estonia) as well as Egypt and Singapore during the third quarter. We estimate that we our brands will then be available during the fourth quarter of 2025 or the first quarter of 2026 in the flowing countries: Dubai, Turkey, Israel, Spain, England, Philippines, China, Panama, Brazil, and Columbia. We currently do not have any distribution in those countries, and there is no guarantee that we will be able to expand to those countries in the time frame that we have proposed.

**Raw Materials**

The raw materials that go into creating different types of spirits can vary depending on the spirit, but items like bottles, caps, and labels are consistent in the make-up of the products.

For our Tequila, all of the raw materials come from within Mexico. All of our Ultra-Premium Tequila is made from 100% Blue Weber Agave, harvested in the highlands (Los Altos) of Jalisco, Mexico. The reason we harvest there has to do with the quality of the agave, as well as for the rules and regulations that govern the production of tequila, as well as price and logistical advantages. The agave used to produce the tequila comes from within the designated jurisdictions of Mexico. Agave prices can be volatile and fluctuate significantly with supply and demand forces.

For our Yamazakura Japanese Whisky, Yamazakura sources all the bottles and labels from multiple sources. The whisky is produced in Koriyama Japan, at the Asaka Distillery. The main water source and the cooling winds come from Mt. Bandai, which we feel imparts a unique quality to our whisky that is difficult to replicate elsewhere. From there we blend different whiskies from around the world, to create our final product. Our goal, and future intention, is to source all the raw whisky-related materials from Japan. We believe this will be important from quality and logistical standpoints.

The consistent components of our products—bottles, caps, and labels—experience price fluctuations, but these are generally less susceptible to market volatility. While inflationary pressures have led to some price increases, these changes have followed a steady upward trend rather than exhibiting significant volatility.

**Competition**

The alcoholic beverage industry is highly competitive. We believe that we compete on the basis of quality, price, brand recognition and distribution strength. Our premium brands compete with other alcoholic and nonalcoholic beverages for consumer purchases, retail shelf space, restaurant presence and wholesaler attention. We compete with numerous multinational producers and distributors of alcoholic beverage products.

Many of our current and potential competitors have longer operating histories and have substantially greater financial, sales, marketing and other resources than we do, as well as larger installed customer bases, greater name recognition and broader product offerings. Some of these competitors can devote greater resources to the development, promotion, sale and support of their products. As a result, it is possible that our competitors may either respond to industry conditions or consumer trends more rapidly or effectively or resort to price competition to sustain market share, which could adversely affect our sales and profitability.

Over the past ten years, the U.S. wine and spirits industry has undergone dramatic consolidation and realignment of brands and brand ownership. The number of major importers in the U.S. has declined significantly. Today there are seven major importers: Diageo PLC, Pernod Ricard S.A., Bacardi Limited, Brown-Forman Corporation, Beam Suntory Inc., Davide Campari Milano-S.p.A., and Remy Cointreau S.A.

By focusing on the premium and super-premium segments of the market, which typically have higher margins, and having an established, experienced sales force, we believe we are able to gain relatively significant attention from our distributors for a company of our size. Also, the continued consolidation among the major companies is expected to create an opportunity for small to mid-size wine and spirits companies, as the major companies contract their portfolios to focus on fewer brands.

**Our Competitive Strengths**

We believe that we have the following competitive strengths:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Award Winning Premium Spirits in High Growth Categories*** 

Our spirits are award winning, high quality, premium branded spirits with potential in the higher growth categories of the distilled spirits industry. All three varieties of our Comisario® tequila (Blanco, Reposado and Añejo) have consistently garnered the highest awards and industry honors. See **Exhibit 6.1** for more information about awards and rankings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Experienced Sales Force and Marketing Infrastructure*** 

We have developed an effective sales and marketing infrastructure, through the use of First Step Beverage and similar companies in order to efficiently execute our sales plan. We have also developed focused advertising, marketing and promotional programs and campaigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Experienced Management*** 

We believe that we have a highly qualified and experienced management through our CEO, Luis Cota, who has a successful track record in brand development, the distilled spirits industry and mergers and acquisitions. Luis Cota, our Chief Executive Officer and President, started his career with the Gallo Winery and has more than 40 years of experience in the industry.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Successful Track Record of Establishing Strategic Partnerships*** 

We have experienced recent achievements establishing strategic partnerships with the owners of alcoholic beverage brands seeking to increase sales beyond their home markets, providing the opportunity for the brands to achieve global growth. We believe this track record will allow us to attract additional brands to our portfolio.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Key Distribution Relationships*** 

Stellar Spirits & Wines Inc. has recently signed with a North American distributor who will distribute our product to licensed retail and on-premise locations in 42 states. We are currently working on major retailers with 400+ locations to immediately increase our sales. However as of this Offering we do not have any agreements with major retailers and there can be no guarantee that we will ever enter into any agreements with them.

VIP (Vermont Information Processing) will work with all of our distributors across the United States to generate daily download sales & account information, then passed on to marketing and sales for data translational and strategic alignment.

You can purchase Tequila Comisario® online at popular spirit & wine e-retailers such as CW Spirits among others, we plan to grow our distribution through our sales and marketing strategies which will increase demand for our products among the distributors worldwide.

**Growth and Distribution Strategy**

Our objective is to continue building a distinctive portfolio of global premium spirits brands, with a primary focus on increasing both our total and individual brand case sales. To achieve this, we are well into the development of our planned mezcal and whiskey programs, pursuing associations with selected celebrity partnerships to allow for a quick scaling up of those programs. In addition, we are exploring two other new projects in the rapidly growing flavored spirits and hard seltzer segments.

&nbsp;&nbsp;&nbsp;&nbsp;•  ***Develop Focused Sales Efforts in Key Markets*** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o See "Distributor" above for review of this category.

&nbsp;&nbsp;&nbsp;&nbsp;•  ***Increase Market Penetration of our Existing Spirits Brands*** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o We are utilizing our existing distribution relationships and sales expertise to achieve growth and gain
additional market share within retail stores, bars and restaurants, both domestically and internationally; adding experienced salespeople
in selected markets; increasing sales to national chain accounts; and expanding our international distribution relationships.

&nbsp;&nbsp;&nbsp;&nbsp;•  ***Build Brand Awareness through innovative Marketing, Advertising and Promotional Activities*** 

Our market-leading awards (Our Comisario® brand has received the most awards since its release) have opened doors for creative and compelling campaigns (Tequila Masters' Program, leading Añejo programs, Highlands Appellation, etc.) to establish and reinforce the image of our brands domestically and globally through the coordinated efforts of our experienced internal marketing personnel and experienced third-party design and advertising firms.

**Advertising, Marketing and Promotion**

To build our brands, we must effectively communicate with three distinct audiences: our distributors, the retail trade and the end consumer. Advertising, marketing and promotional activities help to establish and reinforce the image of our brands in our efforts to build substantial brand value. We have budgeted $2 million for our advertising, marketing, and promotional efforts over the next 12 to 18 months. We continually review our budget and revise it according to market penetration, development, cash flow and opportunity.

The Company will be using a variety of marketing techniques to brand and market our products. With a combination of various advertising media, innovative marketing techniques, special events, telemarketing, on-site promotions, press and media coverage. The Company has created and tested a comprehensive and targeted marketing and branding strategy that rivals or exceeds the big brands, at a much lower cost per million dollars. We have positioned ourselves to utilize non-traditional forms or exposure, such as in-house custom designed graphics allowing us to place maximum expose at a minimal cost. Our brands reputation for high quality and innovative products will become the de facto leader of the ultra-premium segment.

**Sales Representatives**

The Company also intends to use the net proceeds from this Offering to expand traditional sales activities by utilizing and expanding its salesforce throughout the US to spread marketing message and brand awareness, conduct brand tasting and product placement via distributor partners to restaurants and retailers.

**Intellectual Property**

Trademarks are an important aspect of our business. We sell our products under a number of trademarks, which we own or use under license. Our brands are protected by trademark registrations or are the subject of pending applications for trademark registration in the U.S. and in other areas where we distribute, or plan to distribute, our brands as part of our planned expansion of distribution territories.

The Company owns the following trademarks:

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|:---|:---|:---|:---|
| **MARK** | **OFFICE** | **REGISTRATION NO.** | **TRADEMARK TYPE** |
| Comisario - Bottles | USPTO | US D618,109S | Design Patent |
| Comisario | Australia | 2026833 | Trademark |
| Comisario | Taiwan | 02045199 | Trademark |
| Comisario | China | 42433587 | Trademark |
| Comisario | China | 42452297 | Trademark |
| Comisario | Int'l Registration | 1518505 | Trademark |
| Comisario | United Kingdom | 00801518505 | Trademark |
| Comisario | Mexico | MX32021 | Design Patent |

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The Company has permission to use the following geographical indication:

· The State of Jalisco has certified that Comisario® is permitted to use the geographical indication "Tequila" and "Tequila 100% De Agave"

· "Tequila" and or "Tequila 100% De Agave" is a geographical indication for a distilled beverage made from the blue agave plant, primarily in the area surrounding the city of Tequila in the Jaliscan Highlands of the central western Mexican state of Jalisco. Tequila is the national spirit of Mexico along with one of Mexico's largest exports. As such "Tequila" was recognized by the EU in 2019 and placed on the EU geographical indications register.

All other intellectual property is in the form of trade secrets, business methods and know-how and is protected through intellectual property assignment and confidentiality agreements with the Company's employees, advisors and consultants.

**Seasonality**

Our industry is subject to seasonality with peak retail sales generally occurring in the fourth calendar quarter, primarily due to seasonal holiday buying. Historically, this holiday demand typically resulted in higher sales for us in our first and fourth fiscal quarters.

**Regulation**

We face extensive government regulation both within and outside the U.S. relating to the development, manufacture, marketing, sale and distribution of our alcoholic beverage products. The following sections describe certain significant regulations that we are subject to. These are not the only regulations that our businesses must comply with. For a description of risks related to the regulations that our businesses are subject to, please refer to the section entitled "Risk Factors—Risks Related to Our Businesses."

Federal, state, local, and foreign authorities regulate the production, storage, transportation, distribution and sale of our products. Some countries and local jurisdictions prohibit or restrict the marketing or sale of distilled spirits in whole or in part.

In the United States, at the federal level, the Alcohol and Tobacco Tax and Trade Bureau of the U.S. Department of the Treasury regulates the wine and spirits industry with respect to the production, blending, bottling, labeling, sales, advertising, and transportation of beverage alcohol. Similar regulatory regimes exist at the state level and in most non-U.S. jurisdictions where we sell our products. In addition, beverage alcohol products are subject to customs duties or excise taxation in many countries, including taxation at the federal, state, and local level in the U.S.

Laws of each nation define distilling and maturation requirements. Mexican authorities regulate the production and bottling of tequilas; they mandate minimum aging periods for extra añejo (three years), añejo (one year), and reposado (two months) tequilas. We believe that we comply with all of the above laws and regulations.

***Environmental Regulations***

Our operations and properties are subject to laws and regulations relating to environmental protection, including those governing air emissions, water discharges and waste management, and workplace health and safety. In addition, certain of our proposed products are regulated by the U.S. Environmental Protection Agency and comparable state regulatory agencies. For a discussion of risks related to compliance with environmental and health and safety laws and risks related to past or future releases of, or exposures to, hazardous substances, please refer to the section entitled "Risk Factors—Risks Related to Our Businesses."

**Property**

Our principal offices are located in Anaheim, California address 970 North Tustin Avenue, Suite 100, Anaheim, California 92807. We have approximately 2,500 square feet on two floors, with an ongoing favorable lease with a base rent of $3,800 per month, ending March 31, 2024. We do not foresee any issues with extending the lease going forward at a similar rental amount.

During the fiscal years ending December 31, 2023, and 2022 the Company invested in leased property that was to be used as corporate offices in Anaheim, California. Rent from that facility for the Twelve months ended December 31, 2024, and December 31, 2023, is $38,200 respectively.

**Employees**

The Company's business model relies primarily on outsourced manufacturing, distribution, sales and marketing services, with a limited number of internal employees focused on management and administrative functions. Other than our Officers and Directors we have two full-time and no part-time employees of our business or operations who are employed at will by Stellar Spirits and Wines, Inc. We anticipate adding additional employees in the next 12 months, as needed.

As of the date of this Offering Circular, we have 2 full time employees and no part time employees. The following table illustrates the allocation of these employees among the various job functions conducted at our Company:

---

| | |
|:---|:---|
| **Department** | **Number of Employees** |
| Management | 1 |
| Sales / Administrative | 1 |
| **Total** | 2 |
| And a selection of Brokers / Agents in various markets. | And a selection of Brokers / Agents in various markets. |

---

We have good relations with all our employees, and we are not aware of any labor disputes, problems or disruptions.

**Legal Proceedings**

We may from time to time be involved in various claims and legal proceedings of a nature we believe are normal and incidental to our business. These matters may include product liability, intellectual property, employment, personal injury caused by our employees, and other general claims. We are not presently a party to any legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

**MANAGEMENT**

__________

The following table sets forth information regarding our executive officers, directors and significant employees, including their ages as of December 31, 2025:

As of December 31, 2025, the Stellar Spirits and Wines, Inc. had 2 full-time employees, and no part-time employees.

The directors and executive officers of the Company as of December 31, 2025, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Name** | **Position** | **Age** | **Approx. Hours Per Week** |
| Luis Cota | CEO, CFO, Secretary, Director | 75 | 40 |

---

***Luis Cota – CEO, CFO, Secretary and Director***

Luis Cota is our Chief Executive Officer and President and has held those positions since October 2021. Mr. Cota has more than 40 years of experience in the wine and spirits industry. He started his career by spending eight years with the Gallo Winery, holding various positions throughout the United States. Following his time at the Gallo Winery, Mr. Cota spent more than seven years with the Heublein Inglenook Napa Valley Company (now Diageo), managing distribution and running the Central Pacific Region. After working for a select number of Napa Valley wineries, Mr. Cota went on to work for EOS Estate as their National Sales Director for seven years, introduced Tequila Cazadores to the U.S. market, then opened his own company, The Wilkes Wine Group. From 2009 – 2020 Mr. Cota was the National Sales Director and President of EBI, Inc. Mr. Cota is fluent in Spanish, and has high level contacts and experience in Jalisco, Mexico (home of tequila). For the aforementioned reasons we believe that Mr. Cota is an excellent choice to run our Company.

None of our officers or directors in the last five years has been the subject of any conviction in a criminal proceeding or named as a defendant in a pending criminal proceeding (excluding traffic violations and other minor offenses), the entry of an order, judgment, or decree, not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred, suspended or otherwise limited such person's involvement in any type of business, securities, commodities, or banking activities; a finding or judgment by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission, the Commodity Futures Trading Commission, or a state securities regulator of a violation of federal or state securities or commodities law, which finding or judgment has not been reversed, suspended, or vacated; or the entry of an order by a self-regulatory organization that permanently or temporarily barred, suspended or otherwise limited such person's involvement in any type of business or securities activities.

There are no family relationships among and between our directors, officers, persons nominated or chosen by the Company to become directors or officers, or beneficial owners of more than five percent (5%) of the any class of the Company's equity securities.

**EXECUTIVE COMPENSATION**

**__________**

The following summary compensation table sets forth all compensation awarded to, earned by, or paid to our named executive Officer paid by us during the year ended December 31, 2024, in all capacities for the accounts of our executives, including the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), Chief Operating Officer (COO), President (P), and Executive Vice President (EVP).

**SUMMARY COMPENSATION TABLE**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Name and Principal Position** | **Year** | **Salary** <br> **($)** | **Bonus** <br> **($)** | **Stock** <br> **Awards** <br> **($)** | **Option Awards** <br> **($)** | **Non-Equity Incentive Plan Compensation ($)** | **Non-Qualified Deferred Compensation Earnings** <br> **($)** | **All Other Compensation** <br> **($)** | **Totals** <br> **($)** |
| Luis Cota (1) | 2023 | 7500 | 0 | 0 | 0 | 0 | 0 | 0 | 7500 |
| CEO, CFO, Secretary, Director | 2024 | 7500 | 0 | 0 | 0 | 0 | 0 | 0 | 7500 |
| Aggregate Annual Compensation for All Officers and Directors (1 person) | 2024 | 7500 | 0 | 0 | 0 | 0 | 0 | 0 | 7500 |

---

&nbsp;&nbsp;&nbsp;&nbsp;**(1)** Currently we do not have any ongoing plans or arrangements with our
 officers or directors for any proposed compensation. We will not pay our Officers or Directors from proceeds of this Offering. In
 the future the Company may enter into discussions with its Officer and Directors in regards to compensation agreements but as of
 this Offering the Company has not entered into any compensation agreements with its Officer and Director.

*Narrative Disclosure to Summary Compensation Table*

There are no compensatory plans or arrangements, including payments to be received from the Company with respect to any executive Officer, that would result in payments to such person because of his or her resignation, retirement or other termination of employment with the Company, or its subsidiaries, any change in control, or a change in the person's responsibilities following a change in control of the Company.

*Outstanding Equity Awards at Fiscal Year-End*

No executive Officer received any equity awards, or holds exercisable or unexercisable options, as of the year ended December 31, 2024.

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **OPTION AWARDS** | **OPTION AWARDS** | **OPTION AWARDS** | **OPTION AWARDS** | **STOCK AWARDS** | **STOCK AWARDS** | **STOCK AWARDS** | **STOCK AWARDS** | **STOCK AWARDS** |
| <br>**Name** <br>**(a)** | **Number of Securities Underlying Unexercised Options (#) Exercisable** <br>**(b)** | **Number of Securities Underlying Unexercised Options (#) Unexercisable** <br>**(c)** | **Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options**<br> **(#)**<br>**(d)** | **Option Exercise Price ($)** <br>**(e)** | **Option Expiration Date** <br>**(f)** | **Number of Shares or Shares of Stock that have not Vested (#)** <br>**(g)** | **Market Value of Shares or Shares of Stock that have not Vested**<br> **($)**<br>**(h)** | **Equity Incentive Plan Awards: Number of Unearned Shares, Shares or Other Rights that have not Vested**<br> **($)**<br>**(i)** | **Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Shares or Other Rights that have not Vested**<br> **($)**<br>**(j)** |
|  | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |

---

*Long-Term Incentive Plans*

There are no arrangements or plans in which the Company would provide pension, retirement or similar benefits for our Director or executive Officer.

*Compensation Committee*

The Company currently does not have a compensation committee of the Board of Directors. The Board of Directors as a whole determines executive compensation.

*Compensation of Directors*

Directors are permitted to receive fixed fees and other compensation for their services as Directors. The Board of Directors has the authority to fix the compensation of Directors. No amounts have been paid to, or accrued to, Directors in such capacity.

*Director Independence*

The Board of Directors is currently composed of 1 member. Luis Cota, who does not qualify as an independent Director in accordance with the published listing requirements of the NASDAQ Global Market. The NASDAQ independence definition includes a series of objective tests, such as that the Director is not, and has not been for at least three years, one of the Company's employees and that neither the Director, nor any of his family members has engaged in various types of business dealings with us. In addition, the Board of Directors has not made a subjective determination as to the Director that no relationships exist which, in the opinion of the Board of Directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a Director, though such subjective determination is required by the NASDAQ rules. Had the Board of Directors made these determinations, the Board of Directors would have reviewed and discussed information provided by the Director and the Company with regard to our Director's business and personal activities and relationships as they may relate to the Company and its management.

*Security Holders Recommendations to Board of Directors*

The Company welcomes comments and questions from the shareholders. Shareholders can direct communications to Luis Cota, our CEO, 970 North Tustin Avenue, Suite 100, Anaheim, California 92807. Our main telephone number is (714) 242-5130. However, while the Company appreciates all comments from shareholders, it may not be able to individually respond to all communications. Management attempts to address shareholder questions and concerns in press releases and documents filed with the SEC so that all shareholders have access to information about the Company at the same time. Luis Cota collects and evaluates all shareholder communications. All communications addressed to the Director and executive Officer will be reviewed by Luis Cota unless the communication is clearly frivolous.

**CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS**

**__________**

During the last two full fiscal years and the current fiscal year or any currently proposed transaction, there is no transaction involving the Company, in which the amount involved exceeds the lesser of $120,000 or one percent of the average of the Company's total assets at year-end for its last three fiscal years.

**Disclosure of Conflicts of Interest**

Other than the aforementioned, there are no conflicts of interest between the Company and any of its officers or directors.

**Stock Options**

We have not issued and do not have outstanding any options to purchase shares of our Common Stock. We do not have any stock option plans.

**Share Purchase Warrants**

We have not issued and do not have outstanding any warrants to purchase shares of our Common Stock

 

Our articles of incorporation provide that no Director or Officer shall be personally liable for damages for breach of fiduciary duty for any act or omission unless such acts or omissions involve intentional misconduct, fraud, knowing violation of law, or payment of dividends in violation of the California Corporations Code.

**California General Corporation Law**

Under Section 317 of the California Corporations Code, or the CalCorpCode, a California corporation has the power to indemnify any person who was or is a party, or is threatened to be made a party to any proceeding (other than an action by or in the right of the corporation to procure a judgment in its favor) by reason, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he or she is or was an agent of the corporation, against expenses (including attorneys' fees), judgments, fines, settlements and other amounts actually and reasonably incurred in connection with the proceeding if that person acted in good faith and in a manner he or she reasonably believed to be in the best interests of the corporation and, in the case of a criminal proceeding, had no reasonable cause to believe his or her conduct was unlawful.

In addition, a California corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was an agent of the corporation, against expenses actually and reasonably incurred by that person in connection with the defense or settlement of the action if the person acted in good faith, in a manner the person believed to be in the best interests of the corporation and its shareholders, provided that no indemnification shall be made for any of the following (1) with respect to any claim, issue, or matter as to which such person has been adjudged to have been liable to the corporation in the performance of that person's duty to the corporation and its shareholders, unless and only to the extent that the court in which the proceeding is or was pending shall determine upon application that, in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for expenses and then only to the extent that the court shall determine; (2) of amounts paid in settling or otherwise disposing of a pending action without court approval; or (3) of expenses incurred in defending a pending action which is settled or otherwise disposed of without court approval.

Section 317 of the CalCorpCode also provides that, to the extent that an agent of a corporation has been successful on the merits in the defense of any proceeding referred to in either of the foregoing paragraphs or in defense of any claim, issue or matter therein, the agent shall be indemnified against expenses actually and reasonably incurred by the agent in connection therewith.

Section 317 of the CalCorpCode also provides that to the extent that an agent of a corporation has been successful on the merits in defense of any proceeding referred to above or in defense of any claim, issue, or matter therein, the agent shall be indemnified against expenses actually and reasonably incurred by the agent in connection therewith.

Except as provided in the paragraph above, any indemnification under this section shall be made by the corporation only if authorized in the specific case, upon a determination that indemnification of the agent is proper in the circumstances because the agent has met the applicable standard of conduct set forth above, by any of the following: (1) a majority vote of a quorum consisting of directors who are not parties to such proceeding, (2) if such a quorum of directors is not obtainable, by independent legal counsel in a written opinion, (3) approval of the shareholders (Section 153), with the shares owned by the person to be indemnified not being entitled to vote thereon, or (4) The court in which the proceeding is or was pending upon application made by the corporation or the agent or the attorney or other person rendering services in connection with the defense, whether or not the application by the agent, attorney or other person is opposed by the corporation.

**Articles of Incorporation and Bylaws**

The Company's articles of incorporation provide that the liability of the directors of the Corporation for monetary damages shall be eliminated to the fullest extent permissible under California law. Our articles of incorporation and bylaws also provide that we are authorized to provide indemnification of agents (as defined in Section 317 of the Corporations Code) for breach of duty to the corporation and its shareholders through bylaw provisions or through agreements with agents, or both, in excess of the indemnification otherwise permitted by Section 317 of the Corporations Code, subject to the limits of such excess indemnification set forth in Section 204 of the Corporations Code.

We do not currently maintain standard policies of insurance under which coverage is provided (a) to our Director, Officer, employees and other agents against loss arising from claims made by reason of breach of duty or other wrongful act, and (b) to us with respect to payments which may be made by us to such Officers and Directors pursuant to the above indemnification provision or otherwise as a matter of law, although we may do so in the future.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to Directors, Officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy and is, therefore, unenforceable.

***Provisions Relating to Shareholder Liability - Dissolution of the Company***

***Cal. Corp. Code Sec. 2011(a)(1)(B)*** states that causes of action against a dissolved corporation, whether arising before or after the dissolution of the Company, may be enforced against Shareholders if any of the assets of the dissolved corporation have been distributed to Shareholders, to the extent of their pro rata share of the claim or to the extent of the Company's assets distributed to them upon dissolution of the Company, whichever is less.

A Shareholder's total liability under this section may not exceed the total amount of assets of the dissolved Company distributed to the Shareholder upon dissolution of the Company.

***Cal. Corp. Code Sec. 2011(a)(2)*** states that except as set forth in subdivision (c) below, all causes of action against a Shareholder of a dissolved corporation arising under the California Corporations Code are extinguished unless the claimant commences a proceeding to enforce the cause of action against that Shareholder of a dissolved corporation prior to the earlier of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;***(A)*** The expiration of the statute of limitations applicable to the cause of action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;***(B)*** Four years after the effective date of the dissolution of the corporation.

***Cal. Corp. Code Sec. 2011(a)(3)*** states that as a matter of procedure only, and not for purposes of determining liability, Shareholders of the dissolved corporation may be sued in the corporate name of the corporation upon any cause of action against the corporation. This section does not affect the rights of the corporation or its creditors under Section 2009, or the rights, if any, of creditors under the Uniform Voidable Transactions Act, which may arise against the shareholders of a corporation.

**Review, Approval or Ratification of Transactions with Related Parties**

We plan to adopt a related-party transactions policy under which our executive officers, directors, nominees for election as a director, beneficial owners of more than 5% of any class of our Common Stock, and any members of the immediate family of any of the foregoing persons are not permitted to enter into a related-party transaction with us without the consent of our audit committee. If the related party is, or is associated with, a member of our audit committee, the transaction must be reviewed and approved by another independent body of our Board of Directors, such as our governance committee. Any request for us to enter into a transaction with a related party in which the amount involved exceeds $120,000 and such party would have a direct or indirect interest must first be presented to our audit committee for review, consideration and approval. If advance approval of a related-party transaction was not feasible or was not obtained, the related-party transaction must be submitted to the audit committee as soon as reasonably practicable, at which time the audit committee shall consider whether to ratify and continue, amend and ratify, or terminate or rescind such related-party transaction. All of the transactions described above were reviewed and considered by, and were entered into with the approval of, or ratification by, our Board of Directors.

During the last two full fiscal years and the current fiscal year or any currently proposed transaction, there are transactions involving the issuer, in which the amount involved exceeds the lesser of $120,000 or one percent of the average of the issuer's total assets at year-end for its last three fiscal years, except compensation awarded to executives.

**Related Party Transactions**

There are no related party transactions.

**Disclosure of Conflicts of Interest**

There are no conflicts of interest between the Company and its officer or director.

**Legal/Disciplinary History**

None of Stellar Spirits and Wines, Inc.'s Officers or Directors have been the subject of any criminal proceeding or named as a defendant in a pending criminal proceeding (excluding traffic violations and other minor offenses);

None of Stellar Spirits and Wines, Inc.'s Officers or Directors have been the subject of any entry of an order, judgment, or decree, not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred, suspended or otherwise limited such person's involvement in any type of business, securities, commodities, or banking activities;

None of Stellar Spirits and Wines, Inc.'s Officers or Directors have been the subject of any finding or judgment by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission, the Commodity Futures Trading Commission, or a state securities regulator of a violation of federal or state securities or commodities law, which finding or judgment has not been reversed, suspended, or vacated; or

None of Stellar Spirits and Wines, Inc.'s Officers or Directors has been the subject of any entry of an order by a self-regulatory organization that permanently or temporarily barred, suspended or otherwise limited such person's involvement in any type of business or securities activities.

**Board Composition**

Our board of directors currently consists of one member. Each director of the Company will serve until the next annual meeting of stockholders and until his successor is elected and duly qualified, or until his earlier death, resignation or removal. Our board is authorized to appoint persons to the offices of Chairman of the Board of Directors, President, Chief Executive Officer, one or more vice presidents, a Treasurer or Chief Financial Officer and a Secretary and such other offices as may be determined by the board.

We have no formal policy regarding board diversity. In selecting board candidates, we seek individuals who will further the interests of our stockholders through an established record of professional accomplishment, the ability to contribute positively to our collaborative culture, knowledge of our business and understanding of our prospective markets.

**Board Leadership Structure and Risk Oversight**

The board of directors oversees our business and considers the risks associated with our business strategy and decisions. The board currently implements its risk oversight function as a whole. Each of the board committees when established will also provide risk oversight in respect of its areas of concentration and reports material risks to the board for further consideration.

**Code of Business Conduct and Ethics**

Prior to one year from the date of this Offering's qualification, we plan on adopting a written code of business conduct and ethics that applies to our directors, officers and employees, including our principal executive officer, principal financial officer and principal accounting officer or controller, or persons performing similar functions. We will post on our website a current copy of the code and all disclosures that are required by law or market rules in regard to any amendments to, or waivers from, any provision of the code.

**PRINCIPAL STOCKHOLDERS**

**__________**

The following table sets forth certain information known to us regarding beneficial ownership of our capital stock as of December 31, 2025 for (i) all executive officers and directors as a group and (ii) each person, or group of affiliated persons, known by us to be the beneficial owner of more than five percent (5%) of our capital stock. The percentage of beneficial ownership in the table below is based on 323,000,000 shares of common stock deemed to be outstanding as of December 31, 2025.

The following table gives information on ownership of our securities as of December 31, 2025. The following lists ownership of our Common Stock by each person known by us to be the beneficial owner of over 5% of the outstanding Common, and by our officers and directors:

---

| | | |
|:---|:---|:---|
| **Name of Beneficial Owner** | **Amount and Nature of** <br> **Beneficial Ownership<sup>(1)</sup>**  | **Percentage of** <br> **Beneficial Ownership**  |
| **Directors and Officers:** |  |  |
| Luis Cota, CEO, CFO, Secretary, Director | 23000000 | 5.13yes pr%<sup>(2)</sup> |
| All executive officers and directors as a group (1 person) | 23000000 | 5.13% Common Stock <br>5.13%<sup>(2)</sup> Total Common Vote  |

---

_____________

(1) Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person's actual ownership or voting power with respect to the number of shares of common stock actually outstanding.

(2) Based upon 323,000,000
 common shares issued and outstanding, without conversions as of December 31, 2025.

**INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS**

__________

Other than as reported herein, during the last two full fiscal years and the current fiscal year or any currently proposed transaction, there is no transaction involving the Company, in which the amount involved exceeds the lesser of $120,000 or one percent of the average of the Company's total assets at year-end for its last three fiscal years.

**DESCRIPTION OF SECURITIES**

**__________**

**The Company's Authorized Stock**

We are authorized to issue One Billion (1,000,000,000) shares of common stock with a par value of $0.0001 per share (the "Common Stock") and Zero (0) shares of preferred stock (the "Preferred Stock"). Each share of common stock is entitled to one vote per share of common stock.

<u>Common Stock</u> 

No shareholders of the Company holding Common Stock have any preemptive or other right to subscribe for any additional unissued or treasury shares of stock or for other securities of any class.

Subject to the potential rights of holders of Preferred Stock, holders of Common Stock shall be entitled to receive such cash dividends as may be declared thereon by the Board from time to time out of assets of funds of the Company legally available, therefore.

Cumulative Voting. Except as otherwise required by applicable law, there shall be no cumulative voting on any matter brought to a vote of stockholders of the Company.

Except as otherwise required by the California Corporations Code, the Articles of Incorporation, or any designation for a class of Preferred Stock (which may provide that an alternate vote is required), (i) all shares of capital stock of the Company shall vote together as one class on all matters submitted to a vote of the shareholders of the Company; and (ii) the affirmative vote of a majority of the voting power of all outstanding shares of voting stock entitled to vote in connection with the applicable matter shall be required for approval of such matter.

Adoption of Bylaws. In the furtherance and not in limitation of the powers conferred by statute and the Articles of Incorporation, the Board is expressly authorized to adopt, repeal, rescind. alter or amend in any respect the bylaws of the Company.

Shareholder Amendment of Bylaws. The Bylaws may also be adopted, repealed, rescinded, altered or amended in any respect by the stockholders of the Company, but only by the affirmative vote of the holders of not less than a majority of the voting power of all outstanding shares of voting stock, regardless of class and voting together as a single voting class.

Removal of Directors. Except as may otherwise be provided in connection with rights to elect additional directors under specified circumstances, which may be granted to the holders of any class or series of Preferred Stock, any director may be removed from office only by the affirmative vote of the holders of not less than a majority of the voting power of the issued and outstanding stock entitled to vote. Failure of an incumbent director to be nominated to serve an additional term of office shall not be deemed a removal from office requiring any stockholder vote.

<u>Preferred Stock</u>

The powers, preferences, rights, qualifications, limitations and restrictions pertaining to the Preferred Stock, or any series thereof, shall be such as may be fixed, from time to time, by the Board in its sole discretion. Authority to do so being hereby expressly vested in the Board. The authority of the Board with respect to each such series of Preferred Stock will include, without limiting the generality of the foregoing, the determination of any or all of the following:

The number of shares of any series and the designation to distinguish the shares of such series from the shares of all other series: (1) the voting powers, if any, of the shares of such series and whether such voting powers are full or limited: (2) the redemption provisions, if any, applicable to such series, including the redemption price or prices to be paid; (3) whether dividends, if any, will be cumulative or noncumulative, the dividend rate or rates of such series and the dates and preferences of dividends on such series: (4) the rights of such series upon the voluntary or involuntary dissolution of, or upon any distribution of the assets of. the Company: (5) the provisions, if any, pursuant to which the shares of such series are convertible into, or exchangeable for, shares of any other class or classes of any other series of the same other any other class or classes of stock or any other security, of the Company or any other Company or entity, and the rates or other determinants of conversion or exchange applicable thereto; (6) the right, if any, to subscribe for or to purchase any securities of the Company or any other Company or other entity; (7) the provisions, if any. of a sinking fund applicable to such series: and (8) any other relative, participating, optional or other powers, preferences or rights, and any qualifications, limitations or restrictions thereof. of such series.

**DIVIDEND POLICY**

**__________**

We have never declared or paid cash dividends on our capital stock. We currently intend to retain any future earnings for use in the operation of our business and do not intend to declare or pay any cash dividends in the foreseeable future. Any further determination to pay dividends on our capital stock will be at the discretion of our Board of Directors, subject to applicable laws, and will depend on our financial condition, results of operations, capital requirements, general business conditions, and other factors that our Board of Directors considers relevant.

**SECURITIES OFFERED**

__________

**Current Offering**

Stellar Spirits and Wines, Inc. ("STELLAR," "We," or the "Company") is offering up to $10,000,000 total of Shares, each Share consisting of one (1) share of Common Stock, $0.0001 par value (the "Shares" or collectively the "Securities").

**Transfer Agent**

Our transfer agent is Vstock Transfer LLC, whose address is 18 Lafayette Place, LLC, telephone number is (212) 828-8436, and website is www.VStockTransfer.com.

The transfer agent is registered under the Exchange Act and operates under the regulatory authority of the SEC and FINRA.

**SHARES ELIGIBLE FOR FUTURE SALE**

**__________**

Prior to this Offering, there has been no market for our Common Stock. Future sales of substantial amounts of our Common Stock, or securities or instruments convertible into our Common Stock, in the public market, or the perception that such sales may occur, could adversely affect the market price of our Common Stock prevailing from time to time. Furthermore, because there will be limits on the number of shares available for resale shortly after this Offering due to contractual and legal restrictions described below, there may be resales of substantial amounts of our Common Stock in the public market after those restrictions lapse. This could adversely affect the market price of our Common Stock prevailing at that time.

**Rule 144**

In general, a person who has beneficially owned restricted shares of our Common Stock for at least twelve months, in the event we are a reporting company under Regulation A, or at least six months, in the event we have been a reporting company under the Exchange Act for at least 90 days before the sale, would be entitled to sell such securities, provided that such person is not deemed to be an affiliate of ours at the time of sale or to have been an affiliate of ours at any time during the 90 days preceding the sale. A person who is an affiliate of ours at such time would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of shares that does not exceed the greater of the following:

· 1% of the number of shares of our Common Stock then outstanding; or the average weekly trading volume of our Common Stock during the four calendar weeks preceding the filing by such person of a notice on Form 144 with respect to the sale;

provided that, in each case, we are subject to the periodic reporting requirements of the Exchange Act for at least 90 days before the sale. Rule 144 trades must also comply with the manner of sale, notice and other provisions of Rule 144, to the extent applicable.

**LEGAL MATTERS**

__________

Certain legal matters with respect to the shares of common stock offered hereby will be passed upon by Dovi Berger, Esq. of Berger Law Firm, LLC, Cedarhurst, N.Y.

**EXPERTS**

**__________**

The financial statements of the Company appearing elsewhere in this Offering Circular have been prepared by management and have not been reviewed by an independent accountant.

**WHERE YOU CAN FIND MORE INFORMATION**

**__________**

We have filed with the SEC a Regulation A Offering Statement on Form 1-A under the Securities Act with respect to the shares of common stock offered hereby. This Offering Circular, which constitutes a part of the Offering Statement, does not contain all of the information set forth in the Offering Statement or the exhibits and schedules filed therewith. For further information about us and the common stock offered hereby, we refer you to the Offering Statement and the exhibits and schedules filed therewith. Statements contained in this Offering Circular regarding the contents of any contract or other document that is filed as an exhibit to the Offering Statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the Offering Statement. Upon the completion of this Offering, we will be required to file periodic reports, proxy statements, and other information with the SEC pursuant to the Securities Exchange Act of 1934. You may read and copy this information at the SEC's Public Reference Room, 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet website that contains reports, proxy statements and other information about issuers, including us, that file electronically with the SEC. The address of this site is <u>www.sec.gov</u>.

**TABLE OF CONTENTS**

**(UNAUDITED)**

---

| | |
|:---|:---|
| Financial Statements: |  |
| [Consolidated Balance Sheets December 31, 2025, and December 31, 2024](#a_027) | F-2 |
| [Consolidated Statements of Operations for the Twelve Months Ended December 31, 2025, and December 31, 2024](#a_028) | F-3 |
| [Consolidated Statements of Changes in Stockholders' Deficit for the Twelve Months ended December 31, 2025](#a_029) | F-4 |
| [Consolidated Statements of Cash Flows for the Twelve Months Ended December 31, 2025, and December 31, 2024](#a_030) | F-5 |
| [Notes to Consolidated Condensed Financial Statements](#a_031) | F-6 to F-9 |

---

**Stellar Spirits and Wines, Inc.**

**Balance Sheets**

*(Unaudited)*

---

| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2025** | **December 31,**<br>**2024** |
| **ASSETS** |  |  |
| **Current Assets:** |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $52696 | $45864 |
| &nbsp;&nbsp;&nbsp;Accounts receivable, net | 2515733 | 332839 |
| &nbsp;&nbsp;&nbsp;Inventory | 2202582 | 3213225 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current assets** | **4771011** | **3591928** |
| **Other Assets:** |  |  |
| &nbsp;&nbsp;&nbsp;Other assets | 11150 | 11150 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total other assets** | **11150** | **11150** |
| **TOTAL ASSETS** | $**4782161** | $**3603078** |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |
| **Current Liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable | $579050 | $578658 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current liabilities** | **579050** | **578658** |
| **Long-Term Liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;Notes payable - related party | 3674541 | 3307870 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total long-term liabilities** | **3674541** | **3307870** |
| **Total Liabilities** | **4253591** | **3886528** |
| **Stockholders' Equity:** |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, $0.0001 par value; 1,000,000,000 shares authorized; 323,000,000 shares issued and outstanding | 32300 | 32300 |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital | 2921250 | 2921250 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (3237000) | (3735524) |
| &nbsp;&nbsp;&nbsp;Net income | 812020 | 498524 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total stockholders' equity** | **528570** | **(283450)** |
| **TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY** | $**4782161** | $**3603078** |

---

The accompanying notes are an integral part of these financial statements.

**Stellar Spirits and Wines, Inc.**

**Statements of Operations**

*(Unaudited)*

---

| | | |
|:---|:---|:---|
|  | **Year Ended**<br>**December 31, 2025** | **Year Ended**<br>**December 31, 2024** |
| **Revenue** | $**5309372** | $**4427967** |
| Cost of sales | 2454905 | 2314763 |
| **Gross profit** | **2854467** | **2113204** |
| **Operating Expenses:** |  |  |
| &nbsp;&nbsp;&nbsp;Administrative | 80679 | 23906 |
| &nbsp;&nbsp;&nbsp;Advertising and promotion | 356687 | 270968 |
| &nbsp;&nbsp;&nbsp;Distribution costs | 790272 | 637983 |
| &nbsp;&nbsp;&nbsp;Travel | 262289 | 119792 |
| &nbsp;&nbsp;&nbsp;Wages | 249335 | 389706 |
| &nbsp;&nbsp;&nbsp;Legal fees | 3600 | 130583 |
| &nbsp;&nbsp;&nbsp;Professional fees | 48500 |  |
| &nbsp;&nbsp;&nbsp;Rent | 19000 | 38000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total operating expenses** | **1810362** | **1610938** |
| **Net operating income** | **1044105** | **502266** |
| **Other Income (Expense):** |  |  |
| &nbsp;&nbsp;&nbsp;Finance and interest fees | 232085 | 3742 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total other expense** | **232085** | **3742** |
| **NET INCOME** | $**812020** | $**498524** |
| Net income per share - basic and diluted | $0.0025 | $0.0015 |
| Weighted average shares outstanding | 323000000 | 323000000 |

---

The accompanying notes are an integral part of the financial statements.

**Stellar Spirits and Wines, Inc.**

**Statements of Changes in Stockholders' Equity**

For the Years Ended December 31, 2025 and 2024

*(Unaudited)*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Common Stock<br> Shares** | **Common Stock<br> Amount** | **Additional<br> Paid-In<br> Capital** | **Accumulated<br> Deficit** | **Total<br> Stockholders' Equity** |
| **Balance, December 31, 2023** | **23000000** | $**2300** | $**–** | $(3735524) | $**(3733224)** |
| Shares issued for acquisition | 300000000 | 30000 | 2921250 |  | 2951250 |
| Net income, year ended December 31, 2024 | – | – | – | 498524 | 498524 |
| **Balance, December 31, 2024** | **323000000** | $**32300** | $**2921250** | $**(3237000)** | $**(283450)** |
| Net income, year ended December 31, 2025 | – | – | – | 812020 | 812020 |
| **Balance, December 31, 2025** | **323000000** | $**32300** | $**2921250** | $**(2424980)** | $**528570** |

---

The accompanying notes are an integral part of these financial statements.

**Stellar Spirits and Wines, Inc.**

**Statements of Cash Flows**

*(Unaudited)*

---

| | | |
|:---|:---|:---|
|  | **Year Ended**<br>**December 31, 2025** | **Year Ended**<br>**December 31, 2024** |
| **CASH FLOWS FROM OPERATING ACTIVITIES** |  |  |
| &nbsp;&nbsp;&nbsp;Net income | $812020 | $498524 |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to net cash from operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash interest accrual | 228670 |  |
| &nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Increase)/decrease in accounts receivable | (2182895) | (332839) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Increase)/decrease in inventory | 1008146 | (3210728) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase/(decrease) in accounts payable | 392 | 578658 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | – | (251) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash used in operating activities** | **(133667)** | **(2466636)** |
| **CASH FLOWS FROM INVESTING ACTIVITIES** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash from investing activities** | **–** | **–** |
| **CASH FLOWS FROM FINANCING ACTIVITIES** |  |  |
| &nbsp;&nbsp;&nbsp;Net proceeds/(payments) on notes payable | 138001 | 2518279 |
| &nbsp;&nbsp;&nbsp;Other | 2498 | – |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash from financing activities** | **140499** | **2518279** |
| **NET INCREASE (DECREASE) IN CASH** | **6832** | **51643** |
| Cash and cash equivalents, beginning of period | 45864 | (5779) |
| **Cash and cash equivalents, end of period** | $**52696** | $**45864** |
| **NON-CASH SUPPLEMENTAL DISCLOSURE:** |  |  |
| &nbsp;&nbsp;&nbsp;Issuance of 300,000,000 shares of common stock for acquisition of Comisario® brand and related inventory (recorded at $2,951,250) |  |  |

---

The accompanying notes are an integral part of these financial statements.

**STELLAR SPIRITS AND WINES, INC.**

**NOTES TO FINANCIAL STATEMENTS**

**For the Years Ended December 31, 2025, and 2024**

*(Unaudited)*

**NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES**

**A. ORGANIZATION AND OPERATIONS**

The Company was originally incorporated on July 9, 2021, in the State of California under the name of Stellar Spirits & Wines, Inc. The Company is a California-based producer, importer, distributor and marketer of premium brand spirits. The Company owns the Comisario® tequila brand and also has exclusive North American and Chinese distribution rights to Yamazakura Japanese Whiskies, Yamazakura Japanese Sake Wines, and Marta Tequila. The Company seeks to be a leader in providing spirits that offer better value than comparable spirits.

**B. PRINCIPLES OF CONSOLIDATION**

These financial statements include the accounts of the Company, based in the state of California. All material inter-company balances and transactions were eliminated upon consolidation. The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

**C. BASIS OF ACCOUNTING**

The Company utilizes the accrual method of accounting, whereby revenue is recognized when earned and expenses when incurred. The financial statements have been prepared in accordance with generally accepted accounting principles. As such, the financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and these adjustments are of a normal recurring nature.

**D. USE OF ESTIMATES**

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.

**E. CASH AND CASH EQUIVALENTS**

Cash and cash equivalents include cash on hand; cash in banks and any highly liquid investments with maturity of three months or less at the time of purchase. The Company maintains cash and cash equivalent balances at financial institutions, which are insured by the Federal Deposit Insurance Corporation up to $250,000.

**F. COMPUTATION OF EARNINGS PER SHARE**

Net income per share is computed by dividing the net income by the weighted average number of common shares outstanding during the period.

Pursuant to ASC 260-10-45, basic income per common share is computed by dividing net income by the weighted average number of shares of common stock outstanding for the periods presented. Diluted income per share is computed by dividing net income by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.

As of December 31, 2025, the Company had 7,906,940 potentially dilutive shares related to the convertible note payable to Elite Beverage International, Inc. (see Note 6). These shares were not included in the diluted earnings per share calculation as their effect is immaterial. The Company did not have any other potentially dilutive equity securities outstanding as of December 31, 2025 and 2024.

**G. INCOME TAXES**

The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

**H. REVENUE RECOGNITION**

The Company recognizes revenue according to ASC 606, Revenue from Contracts with Customers. Revenue is recognized when the customer obtains control over the promised goods or services, in the amount of consideration that can be expected to be received in exchange for those goods and services. Revenue from product sales is recognized at the point of shipment or delivery, depending on the terms of the customer contract.

**I. FAIR VALUE MEASUREMENT**

The Company determines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amounts reported in the balance sheet for cash, accounts receivable, inventory, accounts payable and notes payable approximate their fair market value based on the short-term maturity of these instruments, or in the case of the notes payable, the interest rate approximating market rates for similar instruments.

**J. INTANGIBLE ASSETS**

In 2024, the Company acquired the Comisario® brand, including all intellectual property, trademarks, and know-how, from Elite Beverage International, Inc. in exchange for 300,000,000 shares of common stock (see Note 5). The Company's common stock has no established public trading market and the Company has not obtained a valuation of the brand that meets the fair value measurement standards required under ASC 820 for purposes of recording the asset under ASC 805-50. Accordingly, no value has been assigned to the intangible asset on the accompanying balance sheets.

**K. INVENTORY**

Inventory consists of finished goods and raw materials and is stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out (FIFO) basis.

**L. STOCK-BASED COMPENSATION**

The Company measures and recognizes compensation expense for all share-based payment awards made to employees, consultants and directors based on estimated fair values. Stock-based compensation expense recognized for the years ended December 31, 2025 and 2024 was $0 and $0, respectively.

**M. ADVERTISING COSTS**

The costs of advertising are expensed as incurred. Advertising and promotion expense was $356,687 and $270,968 for the years ended December 31, 2025 and 2024, respectively.

**N. RECENT ACCOUNTING PRONOUNCEMENTS**

The Company reviews new accounting standards as issued. No new standards had any material effect on these financial statements. Management does not believe any recently issued pronouncements will have a material effect on these financial statements.

**NOTE 2 – GOING CONCERN AND LIQUIDITY CONSIDERATIONS**

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has attained profitable operations for both fiscal years 2024 and 2025, generating net income of $498,524 and $812,020, respectively. As of December 31, 2025, the Company had positive working capital of $4,191,961. The Company believes that cash generated from operations, together with proceeds from its Regulation A offering, will be sufficient to fund operations and planned expansion for at least the next twelve months. However, the Company may need to raise additional capital to fund accelerated growth initiatives.

**NOTE 3 – STOCKHOLDERS' EQUITY**

The Company is authorized to issue 1,000,000,000 shares of Common Stock, par value $0.0001 per share. As of December 31, 2025, and December 31, 2024, the Company had 323,000,000 shares of Common Stock issued and outstanding. Each share of common stock entitles the holder to one vote per share.

The Company had 23,000,000 shares of common stock issued and outstanding from its inception. In 2024, the Company issued 300,000,000 shares of common stock to Elite Beverage International, Inc. as consideration for the acquisition of the Comisario® brand and related assets (see Note 5).

**NOTE 4 – INCOME TAXES**

Deferred tax assets arising as a result of net operating loss carry forwards have been offset completely by a valuation allowance due to the uncertainty of their utilization in future periods.

Based on its evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. The Company's evaluation was performed for the tax years ended December 31, 2025 and 2024 for U.S. Federal Income Tax.

The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. No such interest or penalties were recognized during the periods presented. The Company had no accruals for interest and penalties at December 31, 2025. The open tax years are from 2021 through 2025.

**NOTE 5 – ASSET ACQUISITION**

On January 15, 2023, the Company entered into a Brand Purchase Agreement ("BPA") with Elite Beverage International, Inc. ("Elite") to acquire the Comisario® brand, including all intellectual property, trademarks, proprietary recipes, and know-how associated with alcoholic beverages sold under the Comisario name. The BPA contemplated share consideration, with the final share consideration to be determined. On June 1, 2024, the Company entered into an Asset Purchase Agreement ("APA") with Elite, pursuant to which the parties finalized the consideration at 300,000,000 shares of the Company's common stock and the Company acquired certain assets used or held for use in connection with the Comisario® brand, including inventory and related operational assets. The transaction closed effective June 1, 2024.

The Company has treated the BPA and APA together as an integrated asset acquisition transaction. The total consideration consisted of 300,000,000 shares of the Company's common stock. Because the Company's common stock does not have an established public trading market, and because the Company has not obtained a valuation of the Comisario® brand that satisfies the fair value measurement requirements of ASC 820 for purposes of recording the acquired asset under ASC 805-50, the Company recorded the transaction based on the fair value of the identifiable assets acquired. The inventory was recorded at $2,951,250, which approximated its fair value based on the cost of the physical goods at the time of transfer. No separate value was recorded for the Comisario® brand intangible asset.

The Company recorded the issuance of 300,000,000 shares of common stock at par value of $30,000, based on a par value of $0.0001 per share, with additional paid-in capital of $2,921,250, representing the excess of the recorded value of the acquired inventory over the par value of the shares issued.

**NOTE 6 – NOTES PAYABLE – RELATED PARTY**

On June 26, 2025, the Company consolidated its outstanding notes payable to Elite Beverage International, Inc. into a single promissory note in the amount of $3,953,470 (the "Note"), representing the full outstanding balance of advances made by Elite to the Company. The Note bears interest at the rate of 12% per annum if paid in cash, or 15% per annum if paid in shares. The Note was originally due on February 1, 2026, and the maturity date has since been extended to February 1, 2027.

The Note is convertible at the option of the holder into shares of the Company's common stock at a fixed conversion price of $0.50 per share, representing a potential issuance of 7,906,940 shares if fully converted at the outstanding balance as of December 31, 2025.

During the year ended December 31, 2025, the Company made cash payments of $507,599 on the Note. Of this amount, $228,670 was applied to accrued interest and $278,929 was applied to reduce the outstanding principal balance. Interest expense of $228,670 and $3,742 was recognized for the years ended December 31, 2025 and 2024, respectively.

As of December 31, 2025 and 2024, the outstanding principal balance of the Note was $3,674,541 and $3,307,870, respectively. The Note is classified as a long-term liability as the maturity date extends beyond twelve months from the balance sheet date.

Elite Beverage International, Inc. is a third-party creditor of the Company. Other than as a creditor, there is no relationship between Elite and the Company, and the Company and Elite do not have any directors or executive officers in common.

**NOTE 7 – OPERATING LEASE**

The Company leases office space in Anaheim, California. Rent expense for the years ended December 31, 2025 and 2024 was $19,000 and $38,000, respectively.

**NOTE 8 – SUBSEQUENT EVENTS**

Subsequent events were evaluated through March 18, 2026, which is the date the financial statements were available to be issued. There were no events that would require additional disclosure at the time of financial statement presentation.

**PART III—EXHIBITS**

**Index to Exhibits**

---

| | |
|:---|:---|
| **Number** | **Exhibit Description** |
| 2.1\* | [Articles of Incorporation](https://www.sec.gov/Archives/edgar/data/2064965/000168316825002717/stellar_ex0201.htm) |
| 2.2\* | [Bylaws](https://www.sec.gov/Archives/edgar/data/2064965/000168316825002717/stellar_ex0202.htm) |
| 3.1\* | [Specimen Stock Certificate](https://www.sec.gov/Archives/edgar/data/2064965/000168316825002717/stellar_ex0301.htm) |
| 4.1\* | [Subscription Agreement<u> </u>](https://www.sec.gov/Archives/edgar/data/2064965/000168316825002717/stellar_ex0401.htm) |
| 6.1\* | [Exhibit of Awards received](https://www.sec.gov/Archives/edgar/data/2064965/000168316825002717/stellar_ex0601.htm) |
| 6.2\*\* | [Exclusive Distribution Agreement by and between the Company and Aragophene, Inc., dated February 25, 2025](https://www.sec.gov/Archives/edgar/data/2064965/000168316825004360/stellar_ex0602.htm) |
| 6.3\* | [First Step Beverage Distribution Agreement, by and between the Company and First Step Beverage dated July 1, 2024](https://www.sec.gov/Archives/edgar/data/2064965/000168316825002717/stellar_ex0603.htm) |
| 6.4\*\*\* | [Promissory Note by and between the Company and Elite Beverage International, Inc., dated June 26, 2025](https://www.sec.gov/Archives/edgar/data/2064965/000168316825004935/stellar_ex0604.htm) |
| 6.5 | [Brand Purchase Agreement (January 15, 2023)](stellar_ex0605.htm) |
| 6.6 | [Asset Purchase Agreement (June 1, 2024)](stellar_ex0606.htm) |
| 12.1 | [Opinion of Counsel](stellar_ex1201.htm) |

---

\* Incorporated by reference to Form 1-A filed on April 22, 2025. <br> \*\* Incorporated by reference to Form 1-A/A filed on June 10, 2025. <br> \*\*\* Incorporated by reference to Form 1-A/A filed on July 7, 2025.

**SIGNATURES**

Pursuant to the requirements of Regulation A, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form 1-A and has duly caused this Offering Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Anaheim on May 4, 2026.

---

| | |
|:---|:---|
| (Exact name of issuer as specified in its charter): | **Stellar Spirits and Wines, Inc.** |

---

---

| | |
|:---|:---|
| By: | */s/ Luis Cota* |
| Title: | Luis Cota, Chief Executive Officer (Principal Executive Officer) |
| Date: | May 4, 2026 |

---

This Offering Statement has been signed by the following persons in the capacities and on the dates indicated.

---

| | |
|:---|:---|
| By: | */s/ Luis Cota* |
| Title: | Luis Cota, Chief Executive Officer (Principal Executive Officer) Chief Financial Officer<br> (Principal Financial Officer, Principal Accounting Officer) |
| (Date): | May 4, 2026 |

---

---

| | |
|:---|:---|
| SIGNATURES OF DIRECTORS: |  |
| */s/ Luis Cota* | May 4, 2026 |
| Luis Cota | Date |

---

## Ex1A-6

**Exhibit 6.5**

<u>**BRAND PURCHASE AGREEMENT**</u>

THIS **BRAND PURCHASE AGREEMENT ("Agreement")** is entered into as of the 15th day of January, 2023 (the **"Execution Date"),** by and between **Elite Beverage International, Inc.,** a corporation organized and existing under the laws of California with offices at 970 No. Tustin Ave., Suite 100, Anaheim, CA 92807 **("SELLER"),** on its own behalf and on behalf of its Affiliates and **Stellar Spirits and Wines, Inc.,** a corporation organized and existing under the laws of California with offices at Anaheim, California **("PURCHASER")** and. PURCHASER and SELLER may, from time-to-time, be individually referred to as a **"Party"** and collectively referred to as the **"Parties".**

**RECITALS**

WHEREAS, SELLER is a California based producer, importer, distributor and marketer of premium brand spirits with a specialty with tequila (collectively, the "Products"); and

WHEREAS, PURCHASER wishes to acquire, and SELLER wishes to sell to Purchaser, at the Closing (as defined below) the Brand (as hereinafter defined below) on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual agreements and covenants set forth herein and other good and valuable considerations, the receipt and sufficiency of which the Parties hereby acknowledge, the Parties, intending to be legally bound hereby, agree to the foregoing and as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. DEFINITIONS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.1.** **"Affiliate"** means, with respect to a Party, any Person that controls,
is controlled by, or is under common control with that Party. For the purpose of this definition, **"control"** shall refer
to: (a) the possession, directly or indirectly, of the power to direct the management or policies of an entity, whether through the ownership
of voting securities, by contract or otherwise, or (b) the ownership, directly or indirectly, of fifty percent (50%) or more of the voting
securities of such entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.2.** **"Applicable Laws"** means all applicable laws, statutes, rules,
regulations and guidelines, including, without limitation, all good manufacturing practices and all applicable standards or guidelines
promulgated by the appropriate Regulatory Authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.3.** **"Business Day"** means any day other than a Saturday, a Sunday
or a day on which commercial banks located in New York, New York are authorized or required by law to remain closed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.4.** **"Brand"** has the meaning provided in Section 2.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.5.** **"Brand Consideration"** shall mean an amount, not to exceed **$400,000,000,** based upon a valuation to be made on behalf of Seller, to be paid as an earn out to be based upon criteria to be determined by the
Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.6.** **"Calendar Quarter"** means the respective periods of three (3)
consecutive calendar months ending on March 31, June 30, September 30 and December 31.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.7.** **"Calendar Year"** means any twelve (12) month period commencing on January 1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.8.** **"Closing"** has the meaning provided in Section 2.6.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.9.** **"Closing Date"** has the meaning provided in Section 2.6.1.

**2.0.** **"Commercialize" or "Commercialization"** means to manufacture for sale, market, promote, distribute, and seU.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.11.** **"Commercially Reasonable Efforts"** means, with respect to the Development or Commercialization of a Product, that level of efforts and resources
commonly dedicated in the research based pharmaceutical premium
brand sports industry by a company to the development of commercialization, as the case may be, of a product of similar commercial potential
at a similar stage in its lifecycle, in each case taking into account issues of safety and efficacy, product profile, the proprietary
position, the then current competitive environment for such product and the likely timing of such product's entry into the market, the
regulatory environment and status of such product, and other relevant scientific, technical and commercial factors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.12.** **"Control"** or **"Controlled"** means, with respect
to any Intellectual Property Rights, material or document, the legal authority or right (whether by ownership, license or otherwise) of
a Party to grant a license or a sublicense of or under such Intellectual Property Rights, or to provide or provide access to such material
or document, to the other Party without breaching the terms of any agreement with a Third Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.13.** **"Financing Conditions"** means confirmation (1) that PURCHASER has
issued and sold equity securities resulting in gross proceeds to PURCHASER of at least $5 million, and (2) that the net worth of the PURCHASER
immediately following such financing shall be at least $2.5 million. To satisfy the Financing Condition, PURCHASER shall provide SELLER
with a Balance Sheet, certified by PURCHASER's President or Chief Financial Officer, and such other evidence as SELLER may reasonably
request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.14.** **"GAAP"** means the generally accepted accounting principles in the United States, consistently
applied.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.15.** **"Intellectual Property Rights"** means all trade secrets, copyrights,
patents and other patent rights, Trademarks, moral rights, know-how and any and all other intellectual property or proprietary rights
now known or hereafter recognized in any jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.16.** **"Know-How"** means all confidential and proprietary information
and data Controlled by any other confidential and proprietary information and data Controller by SELLER.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.17.** **"Licensed Technology"** means collectively, the Patent Rights and Know-How.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.18.** **"Patents"** means (a) unexpired letters patent (including without
limitation inventor's certificates), including without limitation any substitution, extension, registration, confirmation, reissue, re-examination,
addition, renewal, supplemental protection certificate or inventor's certificate, and (b) pending applications for letters patent, including
without limitation any continuation, divisional, or continuation-in-part thereof, and any provisional or non-provisional applications,
and (c) all foreign or international equivalents of any of the foregoing in any country.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.19. Reserved.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.20.** **"Patents Rights"** means all Patents that are controlled by Seller
as of the Execution Date or the Closing Date and are controlled by SELLER or its Affiliates during the term of this Agreement. The Patent
Rights existing as of the Execution Date are set forth on Schedule A, which shall be updated from time to time, at least annually, to
identify any new Patents or any changes in the status of Patents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.21.** **"Person"** means an individual, corporation, partnership, Limited
Liability Company, trust, business trust, association, Joint Stock Company, joint venture, pool, syndicate, sole proprietorship, unincorporated
organization, governmental authority or any other form of entity not specifically listed herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.22.** **"Product"** means all products sold under the Brand.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.23.** **"Regulatory Approval"** means, with respect to a Product in any country
or jurisdiction, any approval (including where required, pricing and reimbursement approvals), registration, license or authorization
that is required by the applicable Regulatory Authority to market and sell the Product in such country or jurisdiction.

**1.24.** **"Regulatory Authority"** means
 any governmental agency or authority responsible for granting Regulatory Approvals for
 a Product in the Territory.

**1.25.** **"Regulatory Filings"** means,
 with respect to a Product, any submission to a Regulatory Authority of any appropriate regulatory
 application, including, without limitation, any submission to a regulatory advisory board, any marketing
 authorization application, and any supplement or amendment thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.26.** **"Royalty Term"** means, on a Product-by-Product and country-by-country
basis, the period commencing on the First Commercial Sale of the Product in such country and expiring upon the expiration or abandonment
of the last Valid Claim of the Patent Rights which covers Use of the Product in such country.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.27.** **"Territory"** means worldwide.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.28.** **"Third Party"** means any Person other than a Party or an Affiliate of a Party.

**1.29.** **"Valid Claim"** means either:
 (a) a claim of an issued and unexpired patent included within the Patent Rights, which has not been
 permanently revoked or declared unenforceable or invalid by an unreversed and un-appealable or unreversed
 and un-appealed decision of a court or other appropriate body of competent jurisdiction, or (b) a
 claim of a pending patent application included within the Patent Rights, which claim was filed in
 good faith, has not been pending for more than 5 years and has not been abandoned or finally disallowed
 without the possibility of appeal or refiling of such application.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. BRAND PURCHASE, LICENSE GRANT; CLOSING.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. Brand Purchase.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2.1.1 The Brand is defined as the COMISARIO Brand which shall include all alcoholic beverages (except beers); Anise (liqueur); anisette (liqueur); aperitifs; alcoholic beverages containing fruit; alcoholic beverages; except beer; bitters; brandy; cider; cocktails; curacao; digesters (liqueurs and spirits); distilled beverages; alcoholic essences; alcoholic extracts; fruit extracts, alcoholic; gin; kirsch; liqueurs; perry; piquette; pre-mixed alcoholic beverages, other than beer-based; rice alcohol; rum; spirits (beverages); vodka; whisky; wine; alcoholic beverages made from the agave tequilana weber blue variety; distilled blue agave liquor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.1. Upon execution hereof, Purchaser shall be deemed to have acquired the Brand as defined in Section 2.1.1 hereof with payment therefore in accordance with the provisions of the Brand Consideration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Closing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.1. <u>Generally.</u> The licenses granted pursuant to Section 2.1 shall become effective (the **"Closing")** as of the date (the **"Closing Date")** on which the satisfaction or waiver of each of the conditions set forth in Sections 2.2.2 and 2.2.3 has occurred. If the Closing does not occur within five [5] days of the Execution Date, this Agreement shall terminate effective as of the end of such period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.2. <u>SELLER Closing Condition.</u> The obligations of SELLER to consummate the transactions contemplated by this Agreement, are conditioned upon satisfaction of the Financing Condition and SELLER's receipt of written notice thereof from PURCHASER; provided that SELLER may waive such condition. Following such satisfaction and receipt of written notice (or SELLER's waiver of such condition), SELLER will provide to PURCHASER written confirmation (the **"SELLER Confirmation")** that the representations and warranties of SELLER contained in Sections 10.1 are true and correct in all material respects as of the date of such confirmation as if made on the date of such confirmation; provided that such written confirmation may include exceptions **("Exceptions")** to such representations and warranties if applicable (which Exceptions, for clarity, if deemed accepted by PURCHASER pursuant to Section 2.2.3, will then apply to such representations and warranties of SELLER herein made both as of the Execution Date and the Closing Date).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3. <u>Purchaser Closing Condition.</u> The obligations of PURCHASER to consummate the transactions contemplated by this Agreement, including the licenses granted pursuant to Section 2.1, are conditioned upon SELLER providing the SELLER Confirmation (as defined in Section 2.2.2) without Exceptions to PURCHASER; provided that if SELLER provides the SELLER Confirmation with Exceptions to PURCHASER, PURCHASER may waive such condition by written notice to SELLER. If PURCHASER so waives the above condition, PURCHASER shall be deemed to have accepted the Exceptions, and SELLER's representations and warranties under Section 9.1 and 9.2 shall be deemed modified by the Exceptions both as of the Execution Date and as of the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.4. <u>Financing Condition.</u> PURCHASER will use commercially reasonable efforts to satisfy the Financing Condition in as short a time as practicable, and provide SELLER prompt written notice thereof. PURCHASER will provide SELLER with weekly updates regarding its progress towards satisfying this Financing Condition.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. DEVELOPMENT, COMMERCIALIZATION, REGULATORY, MANUFACTURING, GOVERNANCE COMMITTEE AND REPORTS.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1. Development.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.1. <u>General Diligence.</u> PURCHASER shall itself, or through its Affiliates or sub-Purchasers, use Commercially Reasonable Efforts to Develop Products in each Major Market Country and each other country in which PURCHASER determines that Development of Products would fall within Commercially . Reasonable Efforts to Develop Products. Such Development activities shall include without limitation, and without limiting the generality of the foregoing, those set forth in the Development plan attached to this Agreement as <u>Schedule D</u> (as the same may be modified from time to time by PURCHASER, as delivered in writing to SELLER, the **"Development Plan").** The Parties acknowledge that under appropriate circumstances it may fall within Commercially Reasonable Efforts in Developing Products for PURCHASER to decide not to advance to the next stage of Development depending on the outcomes of prior stages of Development. Subject to Section 3.1.2 below, the Parties further acknowledge that under appropriate circumstances it may fall within Commercially Reasonable Efforts in Developing Products for PURCHASER to decide to terminate or wind down a clinical trial.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.2. PURCHASER will undertake the activities described in this Section 3.1 at its sole expense. Subject to its obligations under this Section 3.1 and Section 3.3, PURCHASER shall have sole decision making authority with respect to such activities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.2.** **Commercialization.** PURCHASER shall itself, or through its Affiliates, use
Commercially Reasonable Efforts to Commercialize the Product in each Major Market Country after obtaining Regulatory Approval of Products
in such country, and each other country in which PURCHASER determines that Commercialization of Products would fall within Commercially
reasonable Efforts to Commercialize Products, after obtaining Regulatory Approval of Products in such country. PURCHASER will undertake
such activities at the sole expense of PURCHASER, its Affiliates, and subject to the foregoing diligence obligations, PURCHASER will have
sole decision making authority with respect to such activities. The Parties acknowledge that under appropriate circumstances it may fall
within Commercially Reasonable Efforts in Commercializing Products for PURCHASER to decide not to advance to the next stage of Commercialization
depending on the outcomes of prior stages of Commercialization.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3. Regulatory Vigilance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.1. In connection with its efforts to Develop Products, as between the Parties, PURCHASER shall bear all responsibility (subject to Sections 3) and expense for filing Regulatory Filings in PURCHASER's name and obtaining Regulatory Approval for Products.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4. Governance Committee and Reports.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4.1. The Parties will establish a joint governance committee to provide advice and input with respect to Development and Commercialization plans and activities relating to Products and to review the progress of such activities (the **"Governance Committee").** The Governance Committee will have an equal number of representatives from each Party, provided that PURCHASER will have final decision making authority with respect to matters before the committee (subject to PURCHASER's commitments and obligations under the Agreement). The Governance Committee will meet at least once per year or more frequently as agreed-upon by the Parties. Upon the request of a Party's representative on the Governance Committee, subject to the other Party's prior consent (not to be unreasonably withheld or delayed), other personnel from such Party may attend and participate in such meetings. SELLER's participation in the Governance Committee is a right and not an obligation; provided that in the event that SELLER elects not to participate in such committee, PURCHASER shall have the right to proceed with decision-making with respect to such committee at its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4.2. PURCHASER shall provide SELLER a written report in reasonable detail regarding LICENSEE's progress in Development and Commercialization of each Product, including a summary of activities conducted, significant events or milestones achieved, and data obtained since the last report, and other activities under this Section 3. With respect to each Product, PURCHASER will deliver such report (a) within [30) after each June 30 and December 31 prior to the initial sale date for such Product, and (b) within [30) days after the end of each Calendar Quarter thereafter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **PAYMENT TERMS [Reserved]** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. RECORDS; AUDIT RIGHTS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1. Relevant Records.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.1 **Relevant Records.** PURCHASER shall keep, and shall cause its Affiliates and sub-Purchaser to keep accurate financial books and records pertaining to: PURCHASER's and its Affiliates' and sub-Purchasers' sales of Products, including any and all calculations of payments due to SELLER hereunder, (collectively, **"Relevant Records").** ·PURCHASER Affiliates and sub licenses shall maintain the Relevant Records for the longer of: (a) the period of time required by Applicable Law, or (b) three (3) years following expiration or termination of this Agreement. PURCHASER shall require its sub-Purchasers to provide to PURCHASER copies of all Relevant Records relating to such sub-Purchasers' sale of Products as necessary to allow SELLER to review such Relevant Records when conducting an audit of PURCHASER pursuant to Section 5.1.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.2. **Audit Request.** SELLER shall have the right during the term and for three (3) years thereafter to engage, at its own expense, as independent auditor reasonably acceptable to PURCHASER to examine the Relevant Records in PURCHASER's or its Affiliates' possession from time-to-time, but no more frequently than once every twelve (12) months, as may be necessary to verify compliance with the terms of this Agreement. Such audit shall be requested in writing at least fifteen (15) Business Days in advance, and shall be conducted during PURCHASER's (or its Affiliate's, as applicable) business operations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.3. **Audit Fees and Expenses.** SELLER shall bear any and all fees and expenses it may incur in connection with any such audit of the Relevant Records; provided, however, in the event an audit reveals and underpayment by PURCHASER of more than [$25,000) as to the period subject to the audit, PURCHASER shall reimburse SELLER for any reasonable and documented out-of-pocket costs and expenses of the audit within [60 days] after receipt of written notice thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.4. **Payment of Deficiency.** If any audit establishes that PURCHASER underpaid any amounts due to SELLER under this Agreement, then PURCHASER shall pay SELLER any such deficiency with [60 days] after receipt of written notice thereof. For the avoidance of doubt, such payment will be considered a late payment, subject to Section 4.1.5. If any audit establishes that PURCHASER overpaid any amounts due to SELLER under this Agreement, then PURCHASER shall be entitled to take a credit against future amounts becoming due to SELLER equal to the overpaid amount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. INTELLECTUAL PROPERTY RIGHTS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.1.** <u>**Pre-existing**</u> IP. Subject only to the rights
expressly granted to the other Party under this Agreement, each Party shall retain all rights,
title and interests in and to any Intellectual Property Rights that are owned by, or licenses or sublicensed to, such Party prior to or
independent of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2. Ownership of Inventions and Intellectual Property Rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.1. **"Inventions"** means any and all inventions (whether or not patentable),
that are conceived during the term of and in the course of activities conducted pursuant to this Agreement by one or more employees, Affiliates,
sub-Purchasers or independent contractors of SELLER and/or PURCHASER.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.2. Inventor ship of Inventions shall be determined in accordance with the rules and regulations of the
 U.S. Patent
and Trademark Office. All Inventions made solely by employees, agents and independent contractors of SELLER or its Affiliates and all
Intellectual Property Rights therein, shall be owned solely by SELLER **("SELLER Inventions").** All Inventions made solely
by employees, agents and independent contractors of PURCHASER or its Affiliates or sub-Purchasers, and all Intellectual Property Rights
therein, shall be owned, as between the Parties, solely by PURCHASER **("Purchaser Inventions").** All Inventions made jointly
by employees, agents and independent contractors of each Party or its Affiliates or sublicenses (as applicable), and all Intellectual
Property Rights therein, shall be owned jointly by the Parties such that each Party shall have an undivided interest therein **("Joint Inventions").** All Patents claiming patentable, jointly owned Joint Inventions shall be referred to herein as **"Joint Patent Rights".** Except to the extent either Party is restricted by the licenses granted to the other Party and covenants set forth herein,
each Party shall be entitled to practice and exploit the Joint Inventions without any duty of accounting or obligation to seek consent
from the other Party with respect thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.3.** **Further Actions; Developed** IP. Each Party shall, and shall cause its sub-Purchasers
and Affiliates, and all independent contractors, employees and agents of such Party, to cooperate with the other Party and take all reasonable
actions and execute such agreements, declarations, assignments, legal instruments and documents as may be reasonable required to perfect
the other Party's right, title and interest in and to Inventions, and Patents thereon, and other Intellectual Property Rights as set forth
in Section 6.2.2. Each Party shall also include provisions in its relevant agreements with Third Parties that affect the intent of this
Section 6.3. Licenses Inventions and PURCHASER's interest in Joint Inventions and all Intellectual Property Rights therein, that are related
to any Compound or Product shall be **"Developed IP."** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 Patent Prosecution and Maintenance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.1. PURCHASER shall
be responsible for filing, prosecuting (including in connection with any reexamination, oppositions and the like) and maintaining the
Patent Rights in the Territory. PURCHASER shall file, prosecute and maintain the Patent Rights using qualified outside patent counsel
and foreign patent associates selected by PURCHASER; provided that PURCHASER identifies such counsel for SELLER in advance and SELLER
consents to such counsel (such consent not to be unreasonably withheld or delayed). PURCHASER shall be responsible for all costs and expenses
in connection with such filing, prosecution and maintenance; provided that if PURCHASER intends to abandon, or not file a patent application
included in, any of the Patent Rights in any given country for any purposes, PURCHASER shall provide SELLER with a written notice of such
intent at least (30 days) in advance of the relevant deadline. In such case: (a) SELLER will provide a written response to PURCHASER at
least 10 days in advance of the relevant deadline if SELLER wishes, or wishes to allow a Third Party to, file, prosecute and maintain
(in its sole discretion) such Patent Right in such country; (b) if SELLER provides the affirmative notice under clause (a) above, the
PURCHASER shall promptly provide all files related to filing, prosecuting and maintaining such Patent Right to counsel designated by SELLER;
and (c) upon completion of the transfer of such files under clause (b), PURCHASER shall no longer be responsible for the costs and expenses
relating to filing, prosecuting and maintaining (as applicable) such Patent Right in such country.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.2. PURCHASER shall provide SELLER with material correspondence with each of the patent
office's pertaining to PURCHASER's prosecution of the Patent Rights. Upon the written request of SELLER, PURCHASER shall provide SELLER
with draft copies of all filings and relevant documentation (to the extent not previously submitted to and reviewed by SELLER) relating
to a Patent Rights at least 30 days prior to the required submission date and shall not file or submit any such filing or documentation
until PURCHASER has received comments on such filing and documentation from SELLER and considered any proposed comments to such filings
and documentations in good faith, provided that PURCHASER may file or submit such filings or documentation without considering SELLER's
comments if PURCHASER has not received any comments from SELLER at least 10 days prior to the required submission date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.3. PURCHASER shall have the first right, but not the obligation, to prepare, file,
prosecute and maintain any Joint Patent Right that is not a Patent Right, in each case throughout the world, using patent counsel that
is reasonably acceptable to SELLER. If PURCHASER declines to exercise its first right, SELLER shall have the right (but not the obligation)
to prepare, file, prosecute and maintain such Joint Patent Right, in each case throughout the world. The Party that at the time exercises
the right to prepare, file, prosecute and maintain such a Joint Patent Right may be referenced as the "Controlling Party" below
with respect thereto and the other Party may be referenced as the "Other Party" below with respect thereto. The Controlling
Party shall give the Other Party an opportunity to review the text of any patent application with respect to such Joint Patent Right at
least 30 days before filing and shall consider the Other Party's comments in good faith. The Controlling Party shall supply the Other
Party with a copy of the patent application as filed, together with notice of its filing date and serial number. To the extent it is Controlling
Party for such Joint Patent Rights, PURCHASER shall follow the patent prosecution practice described in Sections 6.4.1 and 6.4.2. The
Other Party shall reimburse the Controlling Party for fifty percent (50%) of the costs incurred by the Controlling Party in preparing,
filing, prosecuting and maintaining any such Joint Patent Right, which reimbursement will be made pursuant to invoices submitted by the
Controlling Party to the Other Party no more often than once per Calendar Quarter; provided that, for clarity, PURCHASER shall be responsible
for all such costs for any Joint Patent Right that is also a Patent Right. If either Party (the "Declining Party") at any time
declines to share in the costs of filing, prosecuting and maintaining any such Joint Patent Right, on a country by country basis, the
Declining Party shall provide the other Party (the "Continuing Party") with [30 day] prior written notice to such effect, in
which event, (i) the Declining Party shall have no responsibility for any expenses incurred in connection with such Joint Patent Right
after the end of such [30 day] period, (ii) if the Continuing Party elects to continue prosecution or maintenance, the Declining Party,
upon the Continuing Party's request, shall execute such documents and perform such acts, at the Continuing Party's expense, as may be
reasonably necessary to assign to the Continuing Party all of the Declining Party's right, title and interest in and to such Joint Patent
Right, with such Joint Patent Right automatically ceasing to be a Joint Patent Right and becoming the patent right solely of the Continuing
Party as of the date of such written notice from the Declining Party, and (iii) for clarity, if the Declining Party is PURCHASER and such
Joint Patent Right would otherwise thereafter be a Patent Right or Future Patent Right, then shall revert to SELLER.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. ACTUAL OR THREATENED INFRINGEMENT, DISCLOSURE OR MISAPPROPRIATION; DEFENSE ACTIONS; ORANGE BOOK LISTING;
AND PATENT TERM EXTENSION

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.1** **Notice.** Each Party will promptly notify the
other Party in writing of (a) any actual or threatened infringement, misappropriation, other violation,
or challenge to the validity, scope or enforceability by a Third Party or any Licensed Technology in the Territory of which it becomes
aware **("Third Party Infringement")** and (b) any allegation by a Third Party that any Intellectual Property Right owned
by it is infringed, misappropriated, or otherwise violated by the Development, Commercialization, and/or Use of any Product of which it
becomes aware **("Defense Action").** 

**7.2** **License Control.** PURCHASER shall have the first right (but not the obligation), at its own expense,
 ti control enforcement of the Licensed Technology against any Third Party Infringement. Prior
 to commencing involvement in any such suit, action or proceeding, PURCHASER shall consult
 with SELLER and shall consider SELLER's timely recommendations regarding the proposed
 suit, action or proceeding, except to the extent delay may reasonably result in the loss
 of rights by or otherwise adversely impact PURCHASER or SELLER. PURCHASER shall give SELLER
 timely notice of any proposed settlement of any such suit, action or proceeding that PURCHASER
 controls and PURCHASER shall not settle, stipulate to any facts or make any admission with
 respect to any Third Party Infringement without SELLER's prior written consent (not
 to be unreasonably withheld) if such settlement, stipulation or admission would: (a) adversely
 affect the validity, enforceability or scope, or admit non-infringement, of any of the Licensed
 Technology; (b) give rise to liability of SELLER or its Affiliates; (c) grant to a Third
 Party a license or covenant not to sue under, or with respect to, any Intellectual Property
 Rights Controlled by SELLER or its Affiliates (other than as expressly provided for in this
 Agreement with respect to PURCHASER's rights to sublicense the Licensed Technology);
 or (d) otherwise impair SELLER's or any of its Affiliates' rights in any Licensed
 Technology or SELLER's or any of its Affiliates' rights in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.3** **SELLER Control.** SELLER shall have the right (but not the obligation)
 to control enforcement of the Licensed Technology against any Third Party Infringement if PURCHASER provides SELLER with written
 notice that it is not exercising its right to control such enforcement, or if PURCHASER fails to initiate or file the relevant
 response to (as applicable), a suit, action or proceeding with respect to such Third Party Infringement prior to or upon the earlier
 of: (a) expiration of the [10 days] prior to the deadline for filing, or filing the applicable response to (as applicable), such
 suit, action or proceeding (including suits, actions or proceedings based on a Third Party's filling of a Paragraph IV
 Certification under 21 CFR §314.94(a)(12)(i)(A)(4))).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.4** **Rights of Non-Controlling Party.** Notwithstanding anything to the contrary
herein, the Party that is not controlling the suit, action or proceeding pertaining to enforcement of the Licensed Technology against
Third Party Infringement as described in this Section 8 shall join as a party to such suit, action or proceeding upon the reasonable request
and expense of the Party controlling such action if necessary for standing purposes. The Party that is not controlling such a suit, action
or proceeding shall have the right to be represented by counsel (which shall act in an advisory capacity only, except for matters solely
directed to such Party) of its own choice and at its own expense (subject to Section 7.5) in any such suit, action or proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.5** **Recoveries.** Any and all recoveries resulting from a suit, action or proceeding
relating to a claim of Third Party Infringement shall first be applied to reimburse each Party's costs and expenses in connection with
such suit, action or proceeding, with any remaining recoveries (the "Remaining Recoveries") allocated (i) if the controlling
Party is PURCHASER, PURCHASER gets 75%, 25% to SELLER, and (ii) if the controlling Party is SELLER. SELLER gets 75%, PURCHASER 25%.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.6** **Defense.** Upon PURCHASER's request, SELLER will reasonably cooperate with PURCHASER, at PURCHASER's expense, to the extent necessary to defend
PURCHASER or any Affiliate or sub-Purchaser of PURCHASER in a Defense Action in which the claim of infringement, misappropriation or other
violation is directed at PURCHASER's or its sub-Purchaser's Use of a Compound (as such Compound exists as of the Execution Date) or the
Know-How (in accordance with Section 2). PURCHASER shall have all authority with respect to any Defense Action, including the right to
exclusive control of the defense of any such suit, action or proceeding and the exclusive right to compromise, litigate, settle or otherwise
dispose of any such suit, action, or proceeding; provided that PURCHASER shall keep SELLER timely informed of the proceedings and filings,
and provide SELLER with copies of all communications pertaining to each Defense Action and PURCHASER shall not settle, stipulate to any
facts or make any admission with respect to any Defense Action without SELLER's prior written consent if such settlement, stipulation
or admission would: (a) adversely affect the validity, enforceability or scope, or admit non-infringement, of any of the Licensed Technology;
(b) give rise to liability of SELLER or its Affiliates; (c) grant to a Third Party a license or covenant not to sue under, or with respect
to, any Intellectual Property Rights Controlled by SELLER or its Affiliates, other than as expressly provided for in this Agreement with
respect to PURCHASER's rights to sublicense the Licensed Technology; or (d) otherwise impair SELLER's or any of its Affiliates'
rights in any Licensed Technology or SELLER's or any of its Affiliates' rights in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.7** **Patent Term Extension.** PURCHASER shall notify SELLER of the date of Regulatory
Approval of a Product by the relevant Regulatory Authority. PURCHASER shall have the right to prepare and file, or to cause SELLER to
prepare and file (at PURCHASER's request and expense), a patent term extension or supplementary protection certificate application upon
Regulatory Approval of such Product. At PURCHASER's request and expense, SELLER shall provide to PURCHASER for inclusion in such filing
any information not in PURCHASER's possession relating to the regulatory timeline, diligence and regulatory period calculations required
as part of the application to complete such application(s), and otherwise reasonably cooperate in any other matters related to preparation
or filing of the application(s) therefor to make such filing within the applicable time period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. CONFIDENTIALITY

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.1.** **Definition. "Confidential Information"** means the terms and provisions
of this Agreement and other proprietary information and data of a financial, commercial or technical nature (including such information
or data or relating to a Third Party) that the disclosing Party or any of its Affiliates has supplied or otherwise made available to the
other Party or its Affiliates, which are disclosed, whether orally, visually or in writing. All Know-How shall be considered SELLER's
Confidential Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.2.** **Obligations.** During the terms of this Agreement and for five (5) years thereafter, the receiving
Party will (a) protect
all Confidential Information of the disclosing Party against unauthorized disclosure to Third Parties, and (b) not use the Confidential
Information of the disclosing Party except as permitted by or in furtherance of exercising rights or carrying out obligations hereunder.
Each receiving Party will treat Confidential Information provided by the other Party with the same degree of care as if it were the receiving Party's own confidential information (but under no circumstances less than reasonable care). The receiving
Party may disclose the Confidential Information provided by the other Party with the same degree of care as if it were the receiving Party's
own confidential information (but under no circumstances less than reasonable care). The receiving Party may disclose the Confidential
Information of the disclosing Party to its Affiliates, and their respective directors, officers, employees, subcontractors, sub-Purchasers,
consultants, attorneys, accounts, banks, acquirers and investors (collectively, **"Recipients")** who have a need-to-know
such information for purposes related to this Agreement, provided that the receiving Party shall hold such Recipients to written obligations
of confidentiality with terms and conditions at least as restrictive as those set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3. Exceptions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.3.1.** The obligations under this Section 8 shall not apply to any information to the extent the receiving Party can demonstrate by competent evidence that such information:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) is (at the time of disclosure) or becomes (after the time of disclosure) known
to the public or part of the public domain through no breach of this Agreement by the receiving Party or any Recipients to whom it disclosed
such information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) was known to, or was otherwise in the possession of, the receiving Party prior
to the time of disclosure by the disclosing Party other than under obligations of confidentiality;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) is disclosed to the receiving Party on a non-confidential basis by a Third Party
who is entitled to disclose it without breaching an confidentiality obligation to the disclosing Party; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) is independently developed by or on behalf of the receiving Party or any of its Affiliates, as evidenced by its written records, without use of access to the Confidential Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.3.2.** The restrictions set forth in this Section 8 shall not prohibit the
 receiving Party from disclosing or using (as specified below) any Confidential Information of the disclosing Party (i) that receiving
Party is required to disclose under Applicable Laws, a court order or other governmental order, or the rules and regulations of the
Securities and Exchange Commission ("SEC") or any national securities exchange, (ii) that the receiving Party needs to
disclose or use to file, prosecute or enforce any Patent Rights under Sections 6 and 7, or (iii) that PURCHASER, as receiving Party,
needs to disclose or use for purposes of obtaining or maintaining Regulatory Approval of Products provided that the receiving Party
(a) as to subsection (i), provides the disclosing Party at least [30 days] prior written notice of such disclosure (and the right to
review and comment on the proposed disclosure), to the extent practicable, (b) as to subsection (i), affords the disclosing Party as
opportunity to oppose or limit, or secure confidential treatment for such required disclosure or, for submissions or disclosures
required by the SEC or national securities exchange, itself uses reasonable efforts to secure confidential treatment for such
required disclosure, (c) as to subsection (i) discloses only that portion of the Confidential Information that the receiving Party
is legally required to disclose as advised by the receiving Party's legal counsel and (d) as to subsection (ii) and (iii), the
receiving Party provides reasonable advance notice to the other Party where reasonably practicable and discloses only that portion
of the Confidential Information that it is reasonably necessary to disclose for such purpose.

**8.3.3.** In the event that SELLER wishes to assign, pledge or otherwise transfer its rights to receive some or all of the Milestone Payments and
Royalties payable hereunder, SELLER may disclose to a Third Party Confidential Information of PURCHASER in connection with any such proposed
assignment, pledge or transfer, provided that SELLER shall hold such Third Parties to written obligations of confidentiality with terms
and conditions at least as restrictive as those set forth in this Agreement. To the extent that any such assignment would affect PURCHASER's
performance of its obligations hereunder, SELLER shall notify PURCHASER promptly if it enters into any agreement under which it has assigned
its rights to receive some or all of the Milestone Payments and Royalties payable hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.4.** **Right to Injunctive Relief.** Each Party agrees that breaches of this Section
8 may cause irreparable harm to the disclosing Party and may entitle the disclosing Party, in addition to any other remedies available
to it (subject to the terms of this Agreement), the right to seek injunctive relief enjoining such action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.5.** **Ongoing Obligation for Confidentiality.** Upon expiration or termination of
this Agreement, the receiving Party shall, and shall cause its Recipients to, destroy, delete, or return (as requested by the disclosing
Party) any Confidential Information of the disclosing Party, except for one copy which may be retained in its confidential files for archive
purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.6.** **Specific Procedures in Regard to Financing.** Any disclosure made by PURCHASER
to prospective investors or others in connection with the financing PURCHASER expects to complete in order to satisfy the Financing Condition
shall be made only pursuant to Confidentiality and Non-Disclosure Agreements or other arrangements in form and substance satisfactory
to SELLER.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **REPRESENTATIONS, WARRANTIES AND COVENANTS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.1.** **Representations and Warranties by Each Party.** Each Party represents and
warrants to the other Party as of the Execution Date (and form and after the Closing, as of the Closing Date, subject to Section 2.2.2
and 2.2.3) that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.1. it is a corporation
duly organized, validly existing, and in good standing under the laws of its jurisdiction of formation;

9.1.2. it has full
corporate power and authority to execute, deliver, and perform under this Agreement, and has taken all corporate action required by Applicable
Law and its organizational documents to authorize the execution and delivery of this Agreement and the consummation of the transactions
contemplated by this Agreement;

9.1.3. this Agreement constitutes a valid and binding agreement enforceable
against it in accordance with its terms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.4. all consents, approvals and authorizations from all governmental authorities or
other Third Parties required to be obtained by such Party in connection with this Agreement have been obtained; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.5. the execution and delivery of this Agreement and all other instruments and documents
required to be executed pursuant to this Agreement, and the consummation of the transactions contemplated hereby do not and shall not:
(i) conflict with or result in a breach of any provision of its organizational documents, (ii) result in a breach of any agreement to
which it is a party that would impair the performance of its obligation hereunder; or (iii) violate any Applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.2.** **Representations and Warranties by SELLER.** SELLER represents and warrants
to PURCHASER as of the Execution Date (and from and after the Closing, as of the Closing Date, subject to Section 2.2.2 and 2.2.3) that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.1. to its Knowledge, the Use of an Existing Product in the form existing as of the
Execution Date within the Territory will not infringe, misappropriate or otherwise violate the Intellectual Property Rights of a Third
Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.2. to its Knowledge, the Use of an Existing Product on or prior to the Execution
Date did not infringe, misappropriate or otherwise violate the Intellectual Property Rights of any Third Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.3. to its Knowledge, no Third Party is or was infringing, misappropriating or otherwise
violating the Licensed Technology within the Territory;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.4. to is Knowledge, no Third Parties have any right, title or interest in or to any
Patent Right existing as of the Execution Date that claims an Existing Product, or the use or manufacture thereof, other thanMGH;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.5. SELLER has not received any advance notices with respect to any material aspect
of an Existing Product that could reasonably be deemed to adversely affect the sales thereof; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.6. SELLER is not a party to any litigation in which any Third Party has alleged that
the Use of an Existing Product within the Territory infringes, misappropriates or otherwise violates the Intellectual Property Rights
of such Third Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3. Representations, Warranties and Covenants by PURCHASER and Covenants of SELLER

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3.1. PURCHASER represents warrants and covenants to SELLER that, to the extent material
the Products, it shall, and shall ensure all Third Parties that it engages with respect to activities directed to the Products shall;
comply in all material respects with all Applicable Laws with respect to its activities and the performance of its obligations hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3.2. Without limiting the generality of Section 9.3.1, PURCHASER shall comply with
the U.S. Foreign Corrupt Practices Act of 1977 (as modified or amended) PURCHASER represents, warrants and covenants that it has not and
will not directly or indirectly offer or pay, or authorize such offer or payment of, any money, or transfer anything of value, to improperly
seek to influence any Government Official.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3.3. PURCHASER covenants that it will not utilize, in conducting Development or Commercialization
of Product, any person or entities that at such time are debarred by FDA, or that, at such time, are under investigation by FDA for debarment
actions pursuant to the provisions of the Generic Drug Enforcement Act of 1992 (21 U.S.C. § 335).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3.4. PURCHASER covenants that all employees, officers, contractors, and consultants of
PURCHASER or its Affiliates working under this Agreement shall execute agreements requiring assignment
to PURCHASER of all right, title and interest in and to their inventions and discoveries invented or otherwise discovered or generated
during the course of and as a result of their association with PURCHASER, whether or not patentable, if any, to PURCHASER as the sole
owner thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3.5. SELLER shall conduct all Trial Completion Activities or activities under the Transition
Plan in material compliance with all Applicable Laws and shall not, to its Knowledge, utilize any person or entity to perform and such
activities that has been or is debarred by FDA pursuant to the provisions of the Generic Drug Enforcement Act of 1992 (21 U.S.C. §
335).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.4.** **No Other Warranties.** EXCEPT AS EXPRESSLY STATED IN THIS ARTICLE 9, NEITHER
PARTY MAKES ANY REPRESENTATIONS OR EXTENDS ANY WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, INCLUDING BUT
NOT LIMITED TO WARRANTIES OF TITLE, NON-INFRINGEMENT, VALIDITY, ENFORCEABILITY, MERCHANTABILITY AND FITNESS FOR A PRATICULAR PURPOSE.
ANY INFORMATION PROVIDED BY SELLER OR ITS AFFILIATES IS MADE AVAILABLE ON AN "AS IS" BASIS WITHOUT WARRANTY WITH RESPECT TO
COMPLETENESS, COMPLIANCE WITH REGULATORY STANDARDS, REGULATIONS OR APPLICABLE LAW OR FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER KIND
OF WARRANTY WHETHER EXPRESS OR IMPLIED.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. INDEMNIFICATION

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1. **Indemnification by PURCHASER.** From and after the Closing, PURCHASER agrees
to indemnify, hold harmless and defend SELLER and its Affiliates, and their respective officers, directors, employees, contractors, agents
and assigns (collectively, **"SELLER lndemnitees"),** from and against any Claims to the extent arising or resulting from:
(a) the Development, Commercialization and other Use of Products by PURCHASER, its Affiliates, subcontractors or sub-Purchasers, (b) PURCHASER's,
its Affiliates', subcontractors' and sub-Purchasers' performance of Trial Completion Activities or activities under the Transition Plan,
(c) the gross negligence of wrongful intentional acts or omissions of PURCHASER, its Affiliates, subcontractors or sub-Purchasers, (d)
breach by PURCHASER of any representation, warranty, obligation or covenant as set forth in this Agreement, (e) breach by PURCHASER of
the scope of the license set forth in Section 2.1. As used herein, **"Claims"** means collectively, any and all Third Party
demands, claims, actions and proceedings (whether criminal or civil, in contract, tort or otherwise) for losses, damages, liabilities,
costs and expenses (including reasonable attorneys' fees).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2. **Indemnification by SELLER.** From and after the Closing, SELLER agrees to
indemnify, hold harmless and defend PURCHASER and its Affiliates and sub-Purchaser, and their respective officers, directors, employees,
contractors, agents and assigns (collectively, **"PURCHASER lndemnitees"),** from and against any Claims to the extent arising
or resulting from (a) the Development of Products by SELLER, its Affiliates, subcontractors or sub-Purchasers prior to the Closing Date,
(b) the gross negligence or wrongful intentional acts or omissions of SELLER, its Affiliates, or subcontractors, or (c) breach by SELLER
of any representation, warranty, obligation or covenant as set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3. **Indemnification Procedure.** In connection with any Claim for which a Party (the "Indemnified
Party") seeks indemnification from the other Party (the "Indemnifying Party") pursuant to this Agreement, the Indemnified
Party shall: (a) give the Indemnifying Party prompt written notice of the Claim; provided, however, that failure to provide such notice
shall not relieve the Indemnifying Party from its liability or obligation hereunder, except to the extent of any material prejudice as
a direct result of such failure; (b) cooperate with the Indemnifying Party, at the Indemnifying Party's expense, in connection
with the defense and settlement of the Claim; and (c) permit the Indemnifying Party to control the defense and settlement of the Claim
only if the' Indemnifying Party confirms in writing that it is liable to indemnify the SELLER Indernnitees or the PURCHASER Indemnitees,
as applicable, in connection with the relevant matter and provides reasonable substantiation that the Indemnifying Party has the financial
resources to pay for the defense and settlement of the Claim (including any settlement of the Claim (including any settlement thereof
or judgment thereon); provided, however, that the Indemnifying Party may not settle the Claim without the indemnified Party's prior
written consent, which shall not be unreasonably withheld or delayed, in the event such settlement materially adversely impacts the indemnified
Party's rights or obligations. Further, the Indemnified Party shall have the right to participate (but not control) and he represented
in any suit or action by advisory council of its selection and at its own expense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. LIMITATION OF LIABILITY

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1. **No Consequential Damage.** EXCEPT FOR A BREACH OF SECTION 2.1 OR SECTION 8
OR OBLIGATIONS ARISING UNDER SECTION 10, NEITHER PARTY SHALL BE LIABLE FOR ANY INDIRECT, CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE
DAMAGES, INCLUDING DAMAGES FOR LOST PROFITS OR LOST REVENUES REGARDLESS OF WHETHER IT HAS BEEN INFORMED OF THE POSSIBILITY OR LIKELIHOOD
OF SUCH DAMAGES OR THE TYPE OF CLAIM, CONTRACT OR TORT (INCLUDING NEGLIGENCE).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. TERM; TERMINATION

12.1. **Term:** The term of this Agreement shall commence as of the Execution Date and unless earlier terminated
 as expressly provided herein, shall expire upon the last-to-expire Royalty Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2. **Termination by PURCHASER** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.1. Termination at Will. PURCHASER may, provided that PURCHASER is not then in material breach of this Agreement, terminate this Agreement in its entirety at will, in its sole discretion, at any time on or after the date that is eighteen (18) months after the Closing Date or not less than one hundred eight (180) days prior written notice to SELLER.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.2. Termination for Safety Concerns, PURCHASER may terminate this Agreement in its entirety on not less than sixty (60) days prior written notice to SELLER if PURCHASER has evidence of safety issues on the basis of which a reasonable investigator would conclude that such issues will prevent the successful Development and Commercialization of Products hereunder. PURCHASER shall provide such evidence to SELLER together with such notice and shall discuss such evidence at reasonably requested by SELLER.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.3. Termination Generally. This Agreement may not be terminated by PURCHASER under this Section 12.2 on a Compound-by-Compound, or country-by-country or other partial basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.3. **Termination for Cause.** Each Party shall have the right, without prejudice to any other remedies available
 to it at law or in equity, to terminate this Agreement in the event the other Party breaches
 any of its material obligations hereunder and fails to cure such breach within thirty (30)
 days of receiving notice thereof; <u>provided, however</u>, if such breach is capable of being cured, but cannot be cured within such
 thirty (30) day period, and the breaching Party initiates actions to cure such breach within
 such period and thereafter diligently pursues such actions, the breaching Party shall have
 such additional period as in reasonable to cure such breach, but in no event will such additional
 period exceed sixty (60) days unless otherwise agreed in writing by the Parties. Any termination
 by a Party under this Section 13.3 shall be without prejudice to any damages or other legal
 or equitable remedies to which it may be entitled from the other Party. For the avoidance
 of doubt, LECENSEE's failure to use Commercially Reasonable Efforts to Develop and
 Commercialize Products in each Major Market Country shall constitute a breach of a material
 obligation **by PURCHASER under this Agreement.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.4. **Termination for a Bankruptcy Event.** SELLER shall have the right to terminate this Agreement by written notice to PURCHASER in the event of a Bankruptcy
Event. **"Bankruptcy Event"** means the occurrence of any of the following: (a) the institution of any bankruptcy, receivership,
insolvency, reorganization or other similar proceedings by or against PURCHASER under any bankruptcy, insolvency, or other similar law
now or hereinafter in effect, including any section or chapter of the United States Bankruptcy Code, as amended or under any similar laws
or statues of the United States or any state thereof (the **"Bankruptcy Code"),** where in the case of involuntary proceedings
such proceedings have not been dismissed or discharged within ninety (90) days after they are instituted, (b) the insolvency or making
of an assignment for the benefit of creditors or the admittance by PURCHASER of any involuntary debts as they mature, (c) the institution
of any reorganization, arrangement or other readjustment of debt plan of PURCHASER not involving the Bankruptcy Code, (d) appointment
of a receiver for all or substantially all of PURCHASER's assets, or (e) any corporate action taken by the board of directors of PURCHASER
in furtherance of any of the foregoing actions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.5. **Termination for Closing Failure.** This Agreement shall terminate as set forth in Section 2.7.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.6. **Effect of Termination or Expiration** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 12.6.1. Upon termination or expiration of this Agreement, PURCHASER shall pay to SELLER all amounts due to SELLER as of the effective date of termination or expiration within thirty (30) days following the effective date of termination or expiration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.6.2. Upon expiration of this Agreement pursuant to Section 12.1. SELLER hereby grants to PURCHASER a royalty-free right and license to use the Know-How for the purpose of the Development and Commercialization of Compounds and Products within the Territory.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.6.3. Upon termination of this Agreement, PURCHASER shall have the right to sell its remaining inventory of Products following the termination of this Agreement so long as PURCHASER has fully paid, and contuse to fully pay when due, any and all Royalties and Milestone Payments owed to SELLER, and PURCHASER otherwise is not in material breach of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.6.4. Subject to Section 12.5.3, upon termination of this Agreement all licenses granted by SELLER to PURCHASER shall terminate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 12.6.5. With the exception of termination of this Agreement by PURCHASER pursuant to Section 12.3, upon termination of this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) PURCHASER hereby grants to SELLER a worldwide, transferable, perpetual and irrevocable
license, with the right to sublicense, under any Intellectual Property Rights Controlled by PURCHASER claiming Inventions that are necessary
to reasonably useful for the Development, Commercialization or other Use of products as they exist at the time of such termination of
this Agreement, including without limitation, any and all Developed IP (as defined in Section 6.3), to Develop, Commercialize and otherwise
Use the Products.

(b) To the extent permitted by applicable Regulatory Authorities and requested by SELLER, PURCHASER
shall: (i) transfer to SELLER all Regulatory Filings and Regulatory Approvals held by PURCHASER with respect to Products, and (ii) to
the extent subsection (i) is not permitted by the applicable Regulatory Authority, permit SELLER, to cross-reference and rely upon any
Regulatory Approvals and Regulatory Filings filed by PURCHASER with respect to Products.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) PURCHASER, if requested in writing by SELLER, shall provide any and all (i) material'
correspondence with the relevant patent office's pertaining to the PURCHASER's prosecution
of the Patent Rights to the extent not previously provided to SELLER during the course of the Agreement and (ii) a report detailing the
status of all Patent Rights at the time of termination or expiration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) PURCHASER hereby grants to SELLER a worldwide, transferable, sub-licensable, perpetual
and irrevocable license to use the Trademarks specifically identifying each Product, excluding for clarity all Trademarks also used in
connection with PURCHASER's business other than with respect to Product, for the purpose of manufacturing, marketing, distributing, selling,
and otherwise Developing and Commercializing, such Products. As used herein, **"Trademarks"** means all registered and unregistered
trademarks, service marks, trade dress, trade names, logos, insignias, domain names, symbols, designs, and combinations thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) At SELLER's option on a stand-by-study basis for any study then on-going, and to
the extent permitted under applicable agreements, PURCHASER will take such actions as SELLER may reasonably request, at SELLER's expense,
to allow SELLER or its CRO to complete the applicable study and to assign all related Regulatory Filings and Regulatory Approvals and
investigator and other agreements relating to such study to SELLER. PURCHASER shall, at SELLER's request (to be made within thirty (30)
days after the effective date of termination of this Agreement), (i) transfer to SELLER or its Affiliate or designee all Inventory then
owned and possessed by PURCHASER provided that SELLER shall reimburse PURCHASER's direct costs thereof, and (ii) assign to SELLER or its
Affiliate or designee any agreements with Third Parties with respect to the Development or Commercialization of Products to the extent
permitted under the terms of such agreements. As used herein, **"Inventory"** means all Products and components and works
in process produced by or on behalf of PURCHASER with respect to the manufacture of Products.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.7. **Survival.** Any expiration or termination of this Agreement shall not preclude
the termination of this Agreement shall not preclude the terminating Party from exercising any other of those remedies to which it may
be entitle under this Agreement or Applicable Law, or terminate any right to obtain performance of any obligation provided for in this
Agreement that shall survive termination. Expiration or termination of this Agreement shall not relieve the Parties of any obligation
accruing hereunder prior to such expiration or termination. Without limiting the foregoing, the provisions of Sections 5, 6.1, 6.2, 6.4.,
8, 9.4, IO (as to claims arising with respect to activities occurring during
the term of this Agreement), 11, 12.6, 12.7, 13.2, 14, 15, 16.2-16.8, and 16.10-16.15 shall survive expiration or termination of this
Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. PUBLICITY AND PUBLICATIONS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.1. Publicity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.1.1. Subject to SELLER's rights pursuant to Section 12.6.5(d) and except as expressly
permitted in Section 13.1.2, neither Party (nor any of its Affiliates or Agents) shall use the Trademarks of the other Party or its Affiliates
in any press release, publication or other form of promotional disclosure without the prior written consent of the other Party in each
instance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.1.2. Each Party agrees not to issue any press release or other public statement, whether
written, electronic, oral or otherwise, disclosing the existence of this Agreement, the terms hereof or any information relating to this
Agreement without the prior written consent of the other Party, <u>provided however,</u> that (a) on the Closing Date, SELLER at its option will, and PURCHASER will, each issue a global press release (collectively, the **"Global Press Releases"),** (b) neither Party will be prevented from complying with any duty of disclosure it may have
pursuant to Applicable Laws or the rules and regulations of the SEC or any national securities exchange so long as the disclosing
Party provides the other Party at least [7] days prior written notice (and the right to review and comment on the proposed
disclosure) to the extent practicable, and only discloses information to the extent required by Applicable Laws or the rules and
regulations of the SEC or national securities exchange, as set forth in Section 8.3. The content of the Global Press Releases shall
be reasonably agreed-upon by the Parties prior to the Closing date and shall describe PURCHASER's proposed development plan
for Products.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.2. **Publications.** PURCHASER acknowledges that SELLER personnel may desire to
publish in scientific journals or present at scientific conferences scientific, pre-clinical or clinical data derived from research and
development related to the Compounds that was conducted by SELLER prior to the Closing Date. SELLER acknowledges that PURCHASER personnel
may desire to publish in scientific journals or present at scientific conferences results of PURCHASER's Development activities hereunder.
Both Parties understand that a reasonable commercial strategy may require delay of publication of information or filing of patent applications.
Accordingly, from and after the Closing Date, no such publication will be submitted and no such presentation shall be made without the
prior written consent of the other Party. Any such publication or presentation shall be submitted in writing to the other Party for review
by the other Party reasonably in advance of the proposed publication or presentation date. The reviewing Party will reasonably consider
such publication or presentation request, but shall not be obligated to consent thereto, and such reviewing Party shall provide its consent
to or denial of such request within thirty (3) days of its receipt of such proposed publication or presentation. The Parties will reasonably
agree upon appropriate authorship of any publication to which the other party consents. In addition, from and after the Closing Date,
if any SELLER publications resulting from research which SELLER exercises the SELLER Retained Rights under Section 2.3 mentions the Neratinib
Compound, SELLER will notify PURCHASER in advance of publication and provide PURCHASER the opportunity to comment on such publication.
The Parties will discuss their publication plans at Transition Committee meetings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. LICENSE INSURANCE

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.1. **Insurance Requirements.** PURCHASER will maintain at all times during
 the term of this Agreement and until the later of: (a) [30) day after termination or expiration of this Agreement, or (b) the
date that all statutes of limitation covering claims or suits that may be instituted for personal injury based on the sale of use of the
Product have expired, commercial general liability insurance from a minimum "A-" AM Bests rated insurance company, including
contractual liability and product liability, if applicable, with coverage limits of not less than $5,000,000 in the aggregate. PURCHASER
has the right to provide the total limits required by any combination of primary and umbrella/excess coverage. The minimum level of insurance
set forth herein shall not be construed to create a limit on PURCHASER's liability hereunder. Such insurance policies shall be primary
and non-contributing with respect to any other similar insurance policies available to the SELLER indemnitees. Any deductibles for such
insurance shall be assumed by PURCHASER.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2. **Policy Notification.** PURCHASER shall provide SELLER with certified copies
of such policies or original certificates of insurance evidencing such insurance: (a) promptly following execution by both Parties of
this Agreement, and (b) prior to expiration of any one type of coverage. PURCHASER shall provide to SELLER at least (60) days written
notice prior to cancellation, termination or any change to restrict the coverage or reduce the limits afforded; provided that no such
notice shall be required if PURCHASER does or will have other or additional coverage in place prior to such cancellation, termination
or change that results in PURCHASER having overall insurance coverage that complies with Section 14.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. DISPUTE RESOLUTION

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.1. **General.** Except for disputes for which injunctive or other equitable
 relief is sought to prevent the unauthorized use or disclosure of proprietary materials or information or prevent the infringement
 or misappropriation of a Party's Intellectual Property Rights, the following procedures shall be sued to resolve any dispute
 arising out of or in connection with this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.2. **Dispute Escalation.** Promptly after the written request of either Party,
each of the Parties shall appoint a designated representative to meet in person or by telephone to attempt in good faith to resolve any
dispute. If the designated representatives do not resolve the dispute within 3 months from the date of such request, then the CEO of PURCHASER
and the President of SELLER (collectively, the **"DR Executives")** shall meet in person or by telephone to review and attempt
to resolve the dispute in good faith. The DR Executives shall have 3 additional months (except as provided in Section 16.4) to attempt
to resolve the dispute.

15.3 **Pursuit of Claims.** With respect to any dispute
 that is not resolved by the Parties as set forth above, except as expressly set forth in Section 15.4 and
 Section 15.5, each Party may pursue claims it has under applicable law, which may include filing suit in
 courts of competent jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. GENERAL PROVISIONS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.1. **Assignment.** Neither Party may assign its rights and obligations under
 this Agreement without the other Party's prior written consent, except that: (a) SELLER, may assign to a Third Party its
 rights to receive some or all of the Milestone Payments and Royalties payable hereunder, provided that doing so does not adversely
 affect in any material respect the payment or other obligations of PURCHASER hereunder; (b) each Party may assign its rights and
 obligations under this Agreement to one or more of its Affiliates without the consent of the other Party, provided that such
 assignment does not increase materially the other Party's payment obligations (including without limitation such other
 Party's tax payment obligations)' and (c) either Party may assign this Agreement to the successor entity in the event it
 undergoes a Change in Control. As used herein, **"Change in Control"** means the acquisition of a Party by a Third
 Party or the sale of all or substantially all of its business to which this Agreement relates. The assigning Party shall provide the
 other Party with prompt written notice of any such assignment. Any permitted assignee pursuant to clauses (b) and (c) above shall
 assume all obligations of its assignor under this Agreement, and no permitted assignment shall relieve the assignor of liability for
 its obligations hereunder. Any attempted assignment in contravention of the foregoing shall be void.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.2. **Severability.** Should one or more of the provisions of this Agreement become
void or unenforceable as a matter of law, then such provision **will** be ineffective only to the extent of such invalidity or unenforceability,
without invalidating the remainder of this Agreement, and the Parties agree to substitute a valid and enforceable provision therefor which,
as nearly as possible, achieves the desired economic effect and mutual understanding of the parties under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.3. Governing Law; Exclusive Jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.3.1. This Agreement shall be governed by and construed under the laws in effect in the State of California, US, without giving effect to any conflicts of laws provision thereof or of any other jurisdiction that would produce contrary result.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.3.2. for such purpose; (b) waives any objection which it may have at any time to the laying of venue of any proceedings brought in such courts; (c) waives any claim that such proceedings have been brought in an inconvenient forum, and (d) further waives the right to object with respect to such proceedings that any such court does not have jurisdiction over such Party. Notwithstanding the foregoing, application may be made to any court of competent jurisdiction with respect to the enforcement of any judgment or award, or the pursuit of injunctive or other equitable relief described in Section 15.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.4. **Force Majeure.** Except with respect to delays or nonperformance caused by
the negligent or intentional act or omission of a Party, any delay or nonperformance by such Party (other than payment obligation under
this Agreement) will not be considered a breach of this Agreement to the extent such delay or nonperformance is caused by acts of God,
natural disasters, acts of the government or civil or military authority, fire, floods, epidemics, quarantine, energy crises, war or riots
or other similar cause outside of the reasonable control of such Party (each, a **"Force Majeure Event"),** provided that
the Party affected by such Force Majeure Event will promptly begin or resume performance as soon as reasonably practicable after the event
has abated. If the Force Majeure Event prevents a Party from performing any of its obligations under this Agreement for [60] days, then
the other Party may terminate this Agreement immediately upon written notice to the non-performing Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.5. **Waivers and Amendments.** The failure of any Party to assert a right hereunder
or to insist upon compliance with any term or condition of this Agreement shall not constitute a waiver of that right or excuse a similar
subsequent failure to perform any such term or condition by the other Party. No waiver shall be effective unless it has been given writing
and signed by the Party giving such waiver. No provision of this Agreement may be amended or modified other than by a written document
signed by authorized representatives of each Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.6. **Relationship of the Parties.** Nothing contained in this Agreement shall
be deemed to constitute a partnership, joint venture, or legal entity of any type between SELLER and PURCHASER, or to constitute one Party
as the agent of the other. Moreover, each Party agrees not to construe this Agreement, or any of the transactions contemplated hereby,
as a partnership for any tax purposes. Each Party shall act solely as an independent contractor, and nothing in this Agreement shall be
construed to give any Party the power or authority to act for, bind, or commit the other Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.7. **Successors and Assigns.** This Agreement shall be binding upon and inure to
the benefit of the Parties hereto and their respective successor and permitted assigns.

16.8 **Notices.** All notices, consents, waivers, and other communications under this Agreement must be in writing and will be deemed to
have been duly given when: (a) delivered by hand (with written confirmation of receipt), (b) sent by fax (with written confirmation of
receipt), provided that a copy is sent by an internationally recognized overnight delivery service (receipt requested), or (c) when received
by the addressee, if sent by an internationally recognized overnight delivery service (receipt requested), in each case to the appropriate
addresses and fax numbers set forth below (or to such other addresses and fax number as a Party may designate by written notice):

If to SELLER:

**Elite Beverage International, Inc.**

970 N. Tustin Ave., Suite 100

Anaheim, CA 92612

Attention: Steve Rice, COO

If to PURCHASER:

**Stellar Spirits and Wines, Inc.**

53 Georgetown

Irvine, CA 92612

Attention: Luis Cota, CEO

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.9. **Further Assurances.** PURCHASER and SELLER hereby covenant and agree without
the necessity of any further consideration, to execute, acknowledge and deliver any and all such other documents and take any such
other action as may be reasonably necessary or appropriate to carry out the intent and purposes of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.10. **No Third Party Beneficiary Rights.** This Agreement is not intended to and
shall not be construed to give any Third Party any interest or rights (including, without limitation, any third party beneficiary rights)
with respect to or in connection with any agreement or provisions contained herein or contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.11. **Entire Agreement; Confidentiality Agreement.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Agreement, together with its Schedules, set forth the entire agreement and
understanding of the Parties as to the subject matter hereof and supersedes all proposals, oral or written, and all other prior communications
between the Parties either respect to such subject matter, including, without limitation, that certain Confidentiality Agreement by and
between the Parties, dated as of January 1, 2023 (the **"CDA").** The Parties acknowledge and agree that, as of the Execution
Date, all Confidential Information (as defined in the CDA) disclosed by SELLER or its Affiliates pursuant to the CDA shall be considered
SELLER's Confidential Information and subject to the terms set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event of any conflict between a material provision of this Agreement and any
Schedule hereto, the Agreement shall control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.12. **Counterparts.** This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.13. **Cumulative Remedies.** Unless otherwise expressly set forth herein, no remedy
referred to in this Agreement is intended to be exclusive, but each shall be cumulative and in addition to any other remedy referred to
in this Agreement or otherwise available under applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.14. **Waiver of Rule of Construction.** Each Party has had the opportunity to consult
with counsel in connection with the review, drafting and negotiation of this Agreement. Accordingly, any rule of construction that any
ambiguity in this Agreement shall be construed against the drafting Party shall not apply.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.15. **Construction.** For purposes of this Agreement: (a) words in the singular
shall be held to include the plural and vice versa as the context requires; (b) the words "including" and "include"
shall mean "including, without limitation,: unless otherwise specified; (c) the terms "hereof," "herewith,",
and "hereunder," and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole
and not to any particular provision of this Agreement; and (d) all references to "Section", "Schedule" and "Exhibit,"
unless otherwise specified, are intended to refer to a Section, Schedule or Exhibit of or to this Agreement.

IN WITNESS WHEREOF, the Parties intending to be bound have caused this Agreement to be executed by their duly authorized representative as of the Execution Date.

---

| | | | |
|:---|:---|:---|:---|
| **STELLAR SPIRIT AND WINES, INC.** | **STELLAR SPIRIT AND WINES, INC.** | **ELITE BEVERAGE INTERNATIONAL, INC.** | **ELITE BEVERAGE INTERNATIONAL, INC.** |
| By: | /s/ Luis Cota | By: | /s/ Steve Rice |
| Name: | Luis Cota | Name: | Steve Rice |
| Title: | CEO | Title: | COO |

---

## Ex1A-6

**Exhibit 6.6**

**EXECUTION COPY**

**ASSET PURCHASE AGREEMENT**

**By and among**

**ELITE BEVERAGE INTERNATIONAL, INC.**

**(As Seller)**

**And**

**STELLAR SPIRITS AND WINES, INC.**

**(As Buyer)**

**Dated As of June 1, 2024**

**<u>**TABLE OF CONTENTS**</u>**

**<u>Page</u>**

**1.** **DEFINITION AND USAGE** 1

1.1 Definition 1

1.2 Other Defined Terms 7

1.3 Usage 8

**2.** **SALE AND TRANSFER OF ASSETS; ASSUMPTION OF LIABILITIES** **9** 

2.1 Assets to Be Sold 9

2.2 Excluded Assets 10

2.3 Liabilities 10

2.4 Third Party Consents 11

**3.** **RESERVED** **12** 

**4.** **CLOSING** **12** 

4.1 Closing 12

4.2 Closing Obligations 12

**5.** **REPRESENTATIONS AND WARRANTIES OF SELLER** **13** 

5.1 Organization and Good Standing 13

5.2 Enforceability; Authority; No Conflict 14

5.3 Ownership of Seller 14

5.4 Financial Statements 14

5.5 Books and Records 14

5.6 Sufficiency of Assets 15

5.7 Description of Owned Real Property 15

5.8 Leased Real Property 15

5.9 Title to Assets; Encumbrances 15

5.10 Conditions of Facilities 15

5.11 Accounts Receivable 16

5.12 Inventories 16

5.13 No Undisclosed Liabilities 16

5.14 Taxes 16

5.15 No Material Adverse Change 16

5.16 Employee Benefits 16

5.17 Compliance with Legal Requirements; Governmental Authorizations 16

5.18 Legal Proceedings 17

5.19 Absence of Certain Changes and Events 17

5.20 Contracts; No Defaults 19

5.21 Insurance 19

5.22 Environmental Matters 20

5.23 Employees 21

i

**<u>**TABLE OF CONTENTS**</u>**

**<u>Page</u>**

5.24 Labor Disputes; Compliance 21

5.25 Intellectual Property Assets 23

5.26 Compliance with the Bribery Laws, Expert Laws, Anti-Terrorism Laws 24

5.27 Supplies; Customers; Product Liability; Product Labeling 24

5.28 Relationships with Related Persons 24

5.29 Brokers or Finders 25

5.30 Warehouse Agreements 25

5.31 Disclosure 25

5.32 No Other Representations 25

**6.** **REPRESENTATIONS AND WARRANTIES OF BUYER** **25** 

6.1 Organization and Good Standing 25

6.2 Authority; No Conflict 25

6.3 Certain Proceedings 26

6.4 Brokers or Finders 26

**7.** **COVENANTS OF SELLER PRIOR TO CLOSING** **26** 

7.1 Access and Investigation 26

7.2 Operation of the Business of Seller 26

7.3 Negative Covenant 28

7.4 Required Approvals 28

7.5 Notification 28

7.6 No Negotiation 28

7.7 Change of Name 28

7.8 Payment of Liabilities 29

7.9 [RESERVED] 29

7.10 WARN Act 29

7.11 RESERVED] 29

**8.** **COVENANTS OF BUYER PRIOR TO CLOSING** **29** 

ii

 

**<u>**TABLE OF CONTENTS**</u>**

**<u>Page</u>**

**9.** **CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE** **29** 

9.1 Accuracy of Representation 29

9.2 Seller's and Parent Company's Performance 29

9.3 Consents 29

9.4 Additional Documents 30

9.5 No Proceedings 30

9.6 Transition Services Agreement 30

9.7 Title Insurance 30

9.8 Governmental Authorizations 30

9.9 Environmental Report 30

9.10 Employees 30

9.11 Due Diligence 30

**10.** **CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE** **31** 

10.1 Accuracy of Representations 31

10.2 Buyer's Performance 31

10.3 No Injunction 31

10.4 TTB Applications 31

10.5 Distilled Spirits Bond 31

10.6 Utilities 31

**11.** **TERMINATION** **31** 

11.1 Termination Events 32

11.2 Effect of Termination 32

**12.** **ADDITIONAL COVENANTS** 32

12.1 Employees and Employee Benefits 32

12.2 Payment of All Taxes Resulting From Sale of Assets by Seller 34

12.3 Payment of Other Retained Liabilities 34

12.4 RESERVED 35

12.5 Retention of and Access to Records 35

12.6 Further Assurances 35

12.7 Refunds and Remittances 36

12.8 Insurance 35

12.9 IT Transition 35

**13.** **INDEMNIFICATION; REMEDIES** **36** 

13.1 Survival 36

13.2 Indemnification and Reimbursement by Seller and Parent Company 36

13.3 Indemnification and Reimbursement by Seller and Parent Company - Environmental Matters 37

13.4 Indemnification and Reimbursement by Buyer 37

13.5 Limitations of Liability – Seller 38

13.6 Time Limitations 39

13.7 RESERVED 39

13.8 Third-Party Claims 39

13.9 Other Claims 40

13.10 Non-Scheduled Assets 40

13.11 Exclusive Remedy 40

iii

**<u>**TABLE OF CONTENTS**</u>**

**<u>Page</u>**

**14.** **CONFIDENTIALITY** **41** 

14.1 Confidential Information 41

**15.** **GENERAL PROVISIONS** **41** 

15.1 Expenses 41

15.2 Public Announcements 41

15.3 Notices 41

15.4 Jurisdiction; Service of Process; Waiver of Jury Trial 42

15.5 Enforcement of Covenants 42

15.6 Waiver; Remedies Cumulative 42

15.7 Entire Agreement and Modification 42

15.8 Assignments, Successors and No Third-Party Rights 43

15.9 Severability 43

15.10 Governing Law 43

---

| | |
|:---|:---|
| **<u>EXHIBITS</u>** |  |
| Exhibit A | - Sample Calculation of the Seller's Working Capital as per August 31, 2011 |
| Exhibit B | - Valuation Methodology of _________________ |
| Exhibit C | - Form of Escrow Agreement |
| Exhibit D | - List of Equipment |
| Exhibit E | - List of Assumed Contracts |
| Exhibit F | - [Reserved] |
| Exhibit G | - Excluded Assets |
| Exhibit H | - Allocation of Purchase Price Methodology |
| Exhibit I | - Form of Recordable Limited Warranty Deed |
| Exhibit J | - Form of Guarantee |
| Exhibit K | - List of Employees |

---

iv

**ASSET PURCHASE AGREEMENT**

THIS ASSET PURCHASE AGREEMENT made and entered into on the 1st day of June 2024, by and among **Elite Beverage International, Inc**., a California corporation ("Seller") and **Stellar Spirits and Wines, Inc**., a California corporation ("Buyer").

**RECITALS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Seller operates an import business for customized and ultra-premium grade spirits consisting of the Comisario Brand of Tequila.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. Seller and Buyer entered into a Brand Purchase Agreement dated as of the 15<sup>th</sup> day of June, 2023 pursuant to which Buyer acquired the Comisario Brand (the "Brand") in exchange for not less than 300,000,000 shares of Buyer's common stock valued at $1.00, based upon a new Brand Valuation made on behalf of Seller. The final number of shares would be determined by the number of Elite shareholders at June 1, 2024. Seller desires to transfer to Buyer, and Buyer desires to receive from Seller, substantially all the assets of Seller used or held for use by it in connection with the Brand on the terms and subject to the conditions set forth herein.

NOW THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties agree as follows:

**1. <u>DEFINITIONS AND USAGE</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.1 <u>Definitions</u>**

For purposes of this Agreement, the following terms and variations thereof have the meanings specified or referred to in this Section 1.1:

"Accounts Receivable" – all trade accounts receivable and other rights to payment from customers of Seller related to the Brand, including all trade accounts receivable representing amounts receivable in respect of goods shipped or products sold or services rendered.

"Affiliate" – with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with such Person. The term "Control" includes the power to direct the management and policies of a Person.

"Anti-Terrorism Law" – any Legal Requirement relating to terrorism or money laundering, including Executive Order 13224, the USA Patriot Act, Legal Requirements administered by the U.S. Treasury Department Office of Foreign Asset Control, and Legal Requirements implementing or comprising the Bank Secrecy Act, as any of the foregoing Legal Requirements may from time to time be amended, renewed, extended or replaced, including but not limited to export controls and trade embargoes.

"Appurtenances" – all privileges, rights, easements, hereditaments and appurtenances belonging to or for the benefit of real estate, and all rights existing in and to any streets, above and below ground tunnels, alleys, passages and other rights-of-way included thereon or adjacent thereto (before or after vacation thereof) and vaults beneath any such streets.

"Best Efforts" – the efforts that a prudent Person desirous of achieving a result would use in similar circumstances to achieve that result as expeditiously as possible, <u>provided</u>, <u>however</u>, that a Person required to use Best Efforts under this Agreement will not be required to take actions that would result in a material adverse change in the benefits to such Person of this Agreement or to expend any material funds or incur any other material burden.

"Blocked Person" – any Person that (i) is listed in the annex to, or is otherwise subject to the provisions of Executive Order 13224, (ii) is owned or controlled by, or acting for or on behalf of any Person that is listed in the annex to, or is otherwise subject to the provisions of Executive Order 13224, (iii) is precluded from dealing, or otherwise engaging in any transaction, with another Person by any Anti-Terrorism Law, (iv) commits, threatens or conspires to commit or supports "terrorism" as defined in Executive Order 13224, (v) is named as a "specially designated national" on the most current list published by the U.S. Treasury Department Office of Foreign Asset Control at its official website or any replacement website or other replacement official publication of such list, or (vi) is an Affiliate of, or otherwise associated with, a Person described in clauses (i) through (v) above.

"Breach" – any breach of, or any inaccuracy in, any representation or warranty or any breach of, or failure to perform or comply with, any covenant or obligation, in or of this Agreement or any other Contract, as appropriate, or any event which with the passing of time or the giving of notice, or both, would constitute such a breach, inaccuracy or failure.

"Business Day" – any day other than (a) Saturday or Sunday or (b) any other day on which banks in Indianapolis, Indiana are permitted or required to be closed.

"Capital Lease" – any lease or other arrangement relating to property which would be required to be accounted for as a capital lease on a balance sheet prepared in accordance with GAAP.

"Closing Date" - the date on which the Closing actually takes place.

"Closing Date Balance Sheet" – a balance sheet of the Brand prepared as of the Effective Time (but without giving effect to the consummation of the transactions contemplated hereby) in accordance with GAAP. If GAAP, and if later required, in accordance with IFRS permits different methods of preparing any item on the Closing Date Balance Sheet, the methodology used in the Balance Sheet with respect to such item shall be used in the preparation of the Closing Date Balance Sheet, subject, however, to the definitions of Current Assets and Current Liabilities set forth herein. For purposes of preparing the Closing Date Balance Sheet, Buyer and Seller shall jointly conduct within three (3) Business Days after the Closing a physical inventory of all inventories of the Brand (including goods in barrels, tanks and in bulk) included in Current Assets. The results of such inventory (adjusted for any transaction occurring after the Closing) shall be used in determining the amount of Current Assets at Closing to be included in the Closing Date Balance Sheet.

"Closing Date Working Capital" – the amount by which Current Assets exceed Current Liabilities. In determining Closing Date Working Capital, Current Assets and Current Liabilities shall be derived solely from the Closing Date Balance Sheet. A sample calculation of the Seller's working capital as per June 1, 2024 is attached hereto as <u>Exhibit A</u>.

"Code" – the Internal Revenue Code of 1986.

"Commonly Used Assets" – assets of Seller that are used in both the Bottling and Packaging Business and the Brand.

"Consent" – any approval, consent, ratification, waiver or other authorization.

"Contract" – any agreement, contract, Lease, consensual obligation, promise or undertaking (whether written or oral and whether express or implied), whether or not legally binding.

"Current Assets" – those assets of Seller that are used or held for use by Seller at the Effective Time in connection with the Brand and that are included in the Assets and that GAAP requires be designated as current assets on a balance sheet, using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Balance Sheet as if such accounts were being prepared and audited as of a fiscal year end, but excluding (a) the portion of any prepaid expense of which Buyer will not receive the benefit following the Closing; (b) deferred Tax assets; and (c) receivables from any of the Seller's Affiliates. Notwithstanding the foregoing, in all inventories included in Current Assets shall be valued at the lower of cost or market and (i) the cost of inventories of neutral grain spirits, and all Tequila stock ("Tequila") shall be valued at the lower of cost or market (ii) the market price of inventories of Agave grain shall be valued at the lower of cost or market.

"Current Liabilities" – those liabilities of Seller at the Effective Time incurred in connection with the Brand that are included in Assumed Liabilities and that GAAP requires be designated as current liabilities on a balance sheet, using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Balance Sheet as if such accounts were being prepared and audited as of a fiscal year end.

"Disclosure Schedule" – the disclosure schedule of Seller attached hereto.

"Effective Time" - 12:01 a.m., Los Angeles, CA time on the Closing Date.

"Encumbrance" – any charge, claim, condition, equitable interest, lien, option, pledge, security interest, mortgage, right of way, easement, encroachment, servitude, right of first option, right of first refusal or similar restriction, including any restriction on use, voting (in the case of any security or equity interest), transfer, receipt of income or exercise of any other attribute of ownership.

"Environment" – soil, land surface or subsurface strata, surface waters (including navigable waters and ocean waters), ground waters, drinking water supply, stream sediments, ambient air (including indoor air), plant and animal life and any other environmental medium or natural resource.

"Environmental, Health and Safety Liabilities" – any cost, damages, expense, Liability, obligation or other responsibility arising from or under any Environmental Law or Occupational Safety and Health Law, including those consisting of or relating to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any environmental, health or safety matter or condition (including on-site or off-site contamination, occupational safety and health and regulation of any chemical substance or product);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any fine, penalty, judgment, award, settlement, legal or administrative proceeding, damages, loss, claim, demand or response, remedial or inspection cost or expense arising under any Environmental Law or Occupational Safety and Health Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) financial responsibility under any Environmental Law or Occupational Safety and Health Law for cleanup costs or corrective action, including any cleanup, removal, containment or other remediation or response actions required by any Environmental Law or Occupational Safety and Health Law and for any natural resource damages; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any other compliance, corrective or remedial measure required under any Environmental Law or Occupational Safety and Health Law;

The terms "removal," "remedial" and "response action" include the types of activities covered by the United States Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA).

"Environmental Law" – any Legal Requirement that requires or relates to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) advising appropriate authorities, employees or the public of intended or actual Releases of pollutants or hazardous substances or materials, violations of discharge limits or other prohibitions and the commencement of activities, such as resources extraction or construction, that could have significant impact on the Environment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) preventing or reducing to acceptable levels the Release of pollutants or hazardous substances or materials into the Environment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) reducing the quantities, preventing the Release or minimizing the hazardous characteristics of waters that are generated;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) assuring that products are designed, formulated, packaged and used so that they do not present unreasonable risks to human health or the Environment when used or disposed of;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) protecting resources, species or ecological amenities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) reducing to acceptable levels the risks inherent in the transportation of hazardous substances, pollutants, oil or other potentially harmful substances;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) cleaning up pollutants that have been Released, preventing the Threat of Release or paying the costs of such clean up or prevention; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) making responsible parties pay private parties, or groups of them, for damages done to their health or the Environment or permitting self-appointed representatives of the public interest to recover for injuries done to public assets.

"Equipment" – all machinery and equipment of every kind owned or leased by Seller and related to the Brand and the Bottling and Packaging Business (wherever located and whether or not carried on Seller's books) together with, to the extent assignable, any express or implies warranty by the manufacturers or sellers or lessors of any item or component part thereof and all maintenance records and other documents relating thereto.

"ERISA" – the Employee Retirement Income Security Act of 1974

"Facilities" or, individually, a "Facility" – any real property, leasehold or other interest in real property currently owned or operated by Seller related to the Brand and the Bottling and Packing Business including the Tangible Personal Property and Equipment used or operated by Seller at the respective locations of the Real Property specified in <u>Section 5.7</u>. Notwithstanding, the foregoing, for purposes of the definitions of "Hazardous Activity" and "Remedial Action" and <u>Sections 5.22</u> and <u>13.3</u>. "Facilities" and "Facility" shall mean any real property, leasehold or other interest in real property currently or formerly owned or operated by Seller, including but not limited to property associated with the Bottling and Packaging Business, and also including the Tangible Personal Property and Equipment used or operated by Seller at the respective locations of the Real Property specified in <u>Section 5.7</u>.

"GAAP" – generally accepted accounting principles in the United States consistently applied.

"Governmental Authorization" – any Consent, license, registration or permit issued, granted, given or otherwise made available by or under the authority of any Governmental Body or pursuant to any Legal Requirement.

"Governmental Body" – any (a) nation, state, county, city, town, borough, village, district or other jurisdiction; (b) federal, sated, local, municipal, foreign or other government; (c) governmental or quasi-governmental authority of any nature (including any agency, branch, department, board, commission, court, tribunal or other entity exercising governmental or quasi-governmental powers); (d) multinational organization or body; (e) body exercising, or entitle or purporting to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; or (f) official of any of the foregoing.

"Guarantee" – any absolute or contingent Liability of a Person under any guarantee, agreement, endorsement, discount with recourse or other obligation to pay, purchase, repurchase or otherwise be or become liable or obligated upon or in respect of any Indebtedness of any other Person.

"Hazardous Activity" – the distribution, generation, handling, importing, management, manufacturing, processing, production, refinement, Release, storage, transfer, transportation, treatment or use of Hazardous Material (a) in, on, under, about or from any of the Facilities or any part thereof into the Environment and any other act, business, operation or thing that increases the danger, or risk of danger, or poses an unreasonable risk of harm, to persons or property on or off the Facilities; or (b) by Seller or any third party for whose conduct Seller is or may be liable.

"Hazardous Material" – any substance, material or waste which is regulated by any Governmental Body, including any material, substance or waste which is defined as a "hazardous waste," "hazardous material," "hazardous substance," "extremely hazardous waste," "restricted hazardous waste," "contaminant," "toxic waste" or "toxic substance" under any provision of Environmental Law, and including petroleum, petroleum products, asbestos, presumed asbestos-containing material or asbestos-containing material, urea formaldehyde and polychlorinated biphenyls.

"IFRS" – International Financing Reporting Standards which are issued to the International Accounting Standards Board which were issued to bring consistency and integrity to accounting standards and practice regardless of the company or the country.

"Improvements" - all buildings, structures, fixtures and improvements including those under construction.

"Indebtedness" – without duplication, (i) all debts and liabilities of a Person for borrowed money (whether in respect of principal, interest, fees, expenses or other amounts), (ii) all Capital Leases of that Person, (iii) all debts and liabilities of that Person representing the deferred acquisition cost of property and services, and (iv) all Guarantees given by that Person.

"Independent Accountants" – BF Borges CPA PC, Lakewood, Colorado

"Inventories" – all inventories of Seller related to the Brand, wherever located, including Tequila Stock, Grain Stock and Coal Stockpiles, all finished goods (including goods in barrels, tanks and in bulk (, work in process, raw materials, spare parts and all other materials and supplies to be used or consumed by Seller in the production of finished goods related to or in connection with the Brand.

"IRS" – the United States Internal Revenue Service and, to the extent relevant, the United States Department of the Treasury.

"Lease" – any real property lease or any lease or rental agreement, license, right to use or installment and conditional sale agreement to which Seller is a party and any other Seller Contract pertaining to the leasing or use of any Tangible Personal Property or Equipment.

"Legal Requirement" – any federal, state, local, municipal, foreign, international, multination or other constitution, law, ordinance, principle of common law, code, regulation, statue or treaty.

"Liability" – with respect to any Person, any liability or obligation of such Person of any kind, character or description, whether known or unknown, absolute or contingent, accrued or un-accrued, disputed or undisputed, liquidate or unliquidated, secured or unsecured, joint or several, due or to become due, vested or unvested, executory, determined, determinable or otherwise, and whether or not the same is required to be accrued on the financial statements of such Person.

"Occupational Safety and Health Law" – any Legal Requirement designed to provide safe and healthful working conditions and to reduce occupational safety and health hazards, including the Occupational Safety and Health Act, and any program whether governmental or private (such as those promulgated or sponsored by industry associations and insurance companies), designed to provide safe and healthful working conditions.

"Order" – any order, injunction, judgment, decree, ruling, assessment or arbitration award of any Governmental Body or arbitrator.

"Ordinary Course of Business" – an action taken by a Person will be deemed to have been taken in the Ordinary Course of Business only if that action is consistent in nature, scope and magnitude with the past practices of such Person and is taken in the ordinary course of the normal, day-to-day operations of such Person.

"Personal Consent" – consent, in a form acceptable to Buyer, of each of Steve Rice and Luis Cota to the transactions contemplated by this Agreement.

"Person" – an individual, partnership, corporation, business trust, limited liability company, limited liability partnership, joint stock company, trust, unincorporated association, joint venture or other entity or a Governmental Body.

"Proceeding" – any action, arbitration, audit, hearing, investigation, litigation or suit (whether civil, criminal, administrative, judicial or investigative, whether formal or informal, whether public or private) commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Body or arbitrator.

"Related Person" – with respect to a specified Person other than an individual: (a) any Person that directly or indirectly controls, is controlled by or is under common control with such specified Person; (b) any Person that holds a 5% or greater interest in such specified Person; (c) each Person that serves as a director, officer, member, manager, partner, executor or trustee of such specified Person (or in a similar capacity); (d) any Person in which such specified Person holds a 5% or greater interest; and (e) any Person with respect to which such specified Person serves as a general partner or a trustee (or in a similar capacity). For purposes of this definition, "control" (including "controlling," controlled by," and "under common control with") means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise, and shall be construed as such term is used in the rules promulgated under the Securities Act of 1933.

"Release" – any release, spill, emission, leaking, pumping, pouring, dumping, emptying, injection, deposit, disposal, discharge, dispersal, leaching or migration on or into the Environment or into or out of any property.

"Remedial Action" – all actions, including any capital expenditures, required or voluntarily undertaken (a) to clean up, remove, treat or in any other way address any Hazardous Material or other substance; (b) to prevent the Release or Threat of Release or to minimize the further Release of any Hazardous Material or other substance so it does not migrate or endanger or threaten to endanger public health or welfare or the Environment; (c) to perform pre-remedial studies and investigations or post-remedial monitoring and care; or (d) to bring all Facilities and the operations conducted thereon into compliance with Environmental Laws and environmental Governmental Authorizations.

"Representative" – with respect to a particular Person, any director, officer, manager, member, employee, agent, consultant, advisor, accountant, financial advisor, legal counselor or other representative of that Person.

"SEC" – the United States Securities and Exchange Commission

"Seller Contract" – any Contract (a) under which Seller has or may acquire any rights or benefits; (b) under which Seller has or may become subject to any obligation or liability; or (c) by which Seller or any of the assets owned or used by Seller is or may become bound.

"Software" – all computer software and subsequent versions thereof, including source code, object, executable or binary code, objects, comments, screens, user interfaces, report formats, templates, menus, buttons and icons and all files, data, materials, manuals, design notes and other items and documentation related thereto or associated therewith.

"Tangible Personal Property" – all tolls, furniture, office equipment, computer hardware, supplies, materials, vehicles and other items of tangible personal property (other than Inventories or Equipment) of every kind owned or leased by Seller and related to the Brand (wherever located and whether or not carried on Seller's books), together with, to the extent assignable, any express or implied warranty b the manufacturers or sellers or lessors of any item or component part thereof and all maintenance records and other documents relating thereto.

"Tax" – any income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, property, environmental, windfall profit, customs, vehicle, airplane, boat, vessel or other title or registration, capital stock, franchise, employees' income withholding, foreign or domestic withholding, social security, unemployment, disability, real property, personal property, sales, use, transfer, value added, alternative, add-on minimum and other tax, fee, assessment, levy, tariff, charge or duty of any kind whatsoever and any interest, penalty, addition or additional amount thereon imposed, assessed or collected by or under the authority of any Governmental Body or payable under any tax-sharing agreement or any other Contract addressing the manner in which any taxes, fees, assessments, levies, tariffs, charges or duties are to be allocated among or paid by the parties thereto.

"Tax Returns" – any return (including any information return), report, statement, schedule, notice, form, declaration, claim for refund or other document or information filed with or submitted to, or required to be filed with or submitted to, any Governmental Body in connection with the determination, assessment, collection or payment of any Tax or in connection with the administration, implementation or enforcement of a compliance with any Legal Requirement relating to any Tax.

"Third Party" – a Person that is not a party to this Agreement

"Third Party Claim" – any claim against any Indemnified Person by a Third Party, whether or not involving a Proceeding.

"Threat of Release" – a reasonable likelihood of a Release that may require action in order to prevent or mitigate damage to the Environment that may result from such Release

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.2 <u>Other Defined Terms</u>**

The following initially capitalized terms are defined in the sections referenced adjacent to such terms in this <u>Section 1.2</u> below:

---

| | |
|:---|:---|
| **<u>Defined Term</u>** | **<u>Section</u>** |
| Active Employees | 12.1(a) |
| Assets | 2.1 |
| Assignment and Assumption Agreement | 4.2(a)(ii) |
| Assumed Contract | 2.1(f) |
| Assumed Liabilities | 2.3(a) |
| Balance Sheet | 5.4 |
| Bill of Sale | 4.2(a)(i) |
| Bottling and Packing Business | Third Recital (C) |
| Bulk Sales Laws | 7.10 |
| Buyer | Introductory Paragraph |
| Buyer Indemnified Persons | 13.2 |
| Buyer's Closing Documents | 6.2(a) |
| Buyer Group | 7.1(a) |
| Cap | 13.5(a) |
| Closing | 4.1 |
| COBRA | 5.16(g) |
| Competing Business | 5.28 |
| Confidential Information | 14.1 |
| Copyrights | 5.25(a) |
| Damages | 13.2 |
| Deductible | 13.5(a) |
| Dispute Notice | 3.2(b) |
| Dispute Period | 3.2 (b) |
| Brand | Second Recital (B) |
| Employee Plans | 5.16(a) |

---

---

| | |
|:---|:---|
| Employment Loss | 13.2(a)(vii) |
| ERISA Affiliate | 5.16(a) |
| Excluded Assets | 2.2 |

---

---

| | |
|:---|:---|
| **<u>Defined Term</u>** | **<u>Section</u>** |
| Hired Active Employees | 12.1(b)(i) |
| Indemnified Person | 13.8(a) |
| Indemnifying Person | 13.8(a) |
| Insured Exception | 7.11(c) |
| Intellectual Property Assets | 5.25(a) |
| Interim Balance Sheet | 5.4 |
| Leased Property | 5.8 |
| Marks | 5.25(a) |
| Net Names | 5.25(a) |
| Non-Real Estate Encumbrances | 5.9(a) |
| Outside Closing Date | 11.1(t) |
| Patents | 5.25(a) |
| Permitted Encumbrances | 5.9(b) |
| Permitted Non-Real Estate Encumbrances | 5.9(a) |
| Permitted Real Estate Encumbrances | 5.9(a) |
| Position Statement | 3.2(c) |
| Post-Closing Delivery | 3.2(a) |
| Proprietary Software | 5.25(i) |
| Real Estate Encumbrances | 5.9(a) |
| Recorded Documents | 7.11(a) |
| Resolution Period | 3.2(d) |
| Retained Liabilities | 2.3(d) |
| Seller | Introductory Paragraph |
| Seller's Closing Documents | 5.2(a) |
| Survey | 7.11(a) |
| Third-Party Software | 5.25(i) |
| Title Commitment | 7.11(a) |
| Title Insurer | 7.11(a) |
| Trade Secrets | 5.25(a) |
| Transition Period | 12.10 |
| Warehouse Agreements | 5.20(a)(xiii) |
| WARN Act | 5.23(b) |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**<u>1.3 Usage</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Interpretation. In this Agreement, unless a clear contrary intention appears: (i) the singular number includes the plural number and vice versa; (ii) reference to any Person includes such Person's successors and assigns but, if applicable, only if such successors and assigns are not prohibited by this Agreement; (iii) reference to any gender includes each other gender; (iv) reference to any agreement, document or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof; (v) the headings of articles and sections to this Agreement are provided for convenience only and will not affect the construction or interpretation hereof, (vi) "hereunder," "hereof," "hereto,: and words of similar import shall be deemed references to this Agreement as a whole and not to any particular Article, Section or other provision hereof, (vii) "including" (and with correlative meaning "include") means including without limiting the generality of any description proceeding such term; (viii) "or" is used in the inclusive sense of "and/or"; (ix) references to documents, instruments or agreements shall be deemed to refer as well to all addenda, exhibits, schedules or amendments thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Accounting Terms and Determinations. Unless otherwise specified herein, all accounting terms used herein shall be interpreted and all accounting determinations hereunder shall be made in accordance with GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Legal Representation of the Parties. This Agreement was negotiated by the parties with the benefit of legal representation, and any rule of construction or interpretation otherwise requiring this Agreement to be construed or interpreted against any party shall not apply to any construction or interpretation hereof.

**2. <u>TRANSFER OF ASSETS: ASSUMPTION OF LIABILITIES</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.1 <u>Assets to be Transferred</u>**

Upon the terms and subject to the conditions set forth in this Agreement, at the Closing, but effective as of the Effective Time, Seller shall sell, convey, assign, transfer and deliver to Buyer, and Buyer shall acquire from Seller, free and clear of any Encumbrances other than Permitted Encumbrances, all of Seller's right, title and interest in and to all of Seller's property and assets, real, personal or mixed, tangible and intangible, of every kind and description, wherever located related to the Brand, including the following (but excluding the Excluded Assets):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Real Property described in <u>Schedule 5.7</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) all Tangible Personal Property (for the avoidance of doubt, this shall include all MRO assets);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) all Inventories;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) all Equipment, including the Equipment listed on <u>Exhibit D</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) all Accounts Receivable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) all Seller Contracts listed in <u>Exhibit E</u> (the "<u>Assumed Contracts</u>");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) all Governmental Authorizations related to the Brand and the Bottling and Packaging Business to the extent transferable to Buyer, including those listed in <u>Schedule 5.17(b)</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) all data and records related to the Brand, including client and customer lists and records, referral sources, research and development reports and records, production reports and records, service and warranty records, equipment logs, operating guides and manuals, financial and accounting data and records, creative materials, advertising materials, promotional material, studies, reports, correspondence, employee email, customer correspondence, and other similar data, documents and records (including data, documents and records stored electronically and all data, documents and, subject to Legal Requirements, copies of all personnel records, for all Hired Active Employees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) all of the intangible rights and property of Seller related to the Brand and the Bottling and Packaging Business, including intellectual Property Assets, going concern value, goodwill, telephone, telecopy and e-mail addresses and listings;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) all insurance benefits, including rights and proceeds, arising from or relating to the Assets or the Assumed Liabilities prior to the Effective Time, unless expended in accordance with this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) all claims of Seller against third parties relating to the Assets or the Brand whether Choate or inchoate, known or unknown, contingent or non-contingent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) all rights of Seller under Assumed Contracts relating to deposits and prepaid expenses, claims for refunds and rights to offset in respect thereof; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) any deposit account held by Seller on behalf of a customer for deposit of or payment of excise taxes.

At any time prior to Closing, Buyer has the right to update <u>Exhibits D</u>, <u>E</u> and/or <u>F</u> to allocate Commonly Used Assets between Buyer and Bottling Acquirer or as otherwise agreed to by the parties hereto.

All of the property and assets to be transferred to Buyer hereunder (including the assets listed on <u>Exhibit F</u>) are herein referred to collectively as the "<u>Assets</u>."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.2 <u>Excluded Assets</u>**

Notwithstanding anything to the contrary contained in <u>Section 2.1</u> or elsewhere in this Agreement, the following assets of Seller (collectively, the "<u>Excluded Assets</u>") are not part of the sale and purchase contemplated hereunder:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all cash, cash equivalents and short-term investments;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) all minute books, stock records and corporate seals;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) all insurance policies and rights thereunder, including but not limited to refunds of prepayments (except to the extend specified in <u>Section2.1(j)</u> and <u>(k)</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) all records that Seller is required by law to retain in its possession;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) all rights of Seller under this Agreement, the Bill of Sale, the Assignment and Assumption Agreement, the Escrow Agreement, and the Bottling Transaction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) all rights, claims and credits of Seller to the extent relating to any Excluded Assets or any liability other than the Assumed Liabilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) any refunds or credits (including interest thereon or claims therefor) with respect to any Taxes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) any consolidated, combined or unitary tax return that includes Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) all Contracts which are not Assumed Contracts;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) any refunds under the any cash bond[s] .

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.3 <u>Liabilities</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Assumed Liabilities</u>. On the Closing Date, but effective as of the Effective Time, Buyer shall assume and agree to discharge only the following Liabilities of Seller (the "<u>Assumed Liabilities</u>"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any trade account payable related to the Brand to the extent reflected as a Current Liability in the calculation of Closing Date Working Capital;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Capital Lease Liabilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any excise Taxes paid for by customers to the extent included in the Accounts Receivable and actually paid to Buyer by the customer after the Closing and any excise Taxes held by Seller on behalf of any customer which Seller actually transfers to Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any Liability to Seller's customers related to the Brand to the extend reflected as a Current Liability in the calculation of Closing Date Working Capital incurred by Seller in the Ordinary Course of Business for non-delinquent orders outstanding as of the Effective Time reflected on Seller's books (other than any Liability arising out of or relating to a Breach that occurred prior to the Effective Time); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) any Liability arising after the Effective Time under the Assumed Contracts (other than any Liability arising out of or relating to a Breach that occurred prior to the Effective Time).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Retained Liabilities</u>. The Retained Liabilities shall remain the sole responsibility of and shall be retained, paid, performed and discharged solely by Seller. "<u>Retained Liabilities</u>" shall mean every Liability of Seller other than the Assumed Liabilities, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any Liability arising out of or relating to (A) the ownership or operation of the Assets by Seller prior to Closing, (B) any services provided by Seller prior to Closing and (C) any products of Seller to the extent manufactured, produced, bottled or sold prior to the Effective Time; provided, that in the case of clause (B) or (C) such Liability arises out of or relates to any omission, occurrence or event happening prior to the Effective Time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any Liability under any Assumed Contract that arises out of or relates to any Breech that occurred prior to the Effective Time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any Liability related to the Contract;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any Liability for Taxes, except as set forth under Section 2.3(a)(v) above;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) any Liability under any Contract that is not as Assumed Contract, including with respect to any Capital Leases;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) any Environmental, Health and Safety Liabilities arising out of or relating to the operation of Seller's business (including the Brand) and prior to the Effective Time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) any Liability arising out of or under any employment, severance or termination agreement, union contract, collective bargaining agreement, the Employee Plans or relating to payroll, vacation, sick lease, workers' compensation, unemployment benefits, pension benefits, employee stock option or profit-sharing plans, deferred compensation arrangements or obligations, health care plans or benefits or any other employee plans or benefits of any kind for Seller's employees or former employees or both;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) any Liability arising out of any Proceeding pending as of the Effective Time and any Liability arising out of any Proceeding commenced after the Effective Time and arising out of or relating to any occurrence or event happening prior to the Effective Time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) any Liability arising out of or related to Indebtedness (and convertible preferred shares) of Seller, including all amounts owned to Colonial Life Insurance Company Limited; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) any Liability arising out of any Excluded Asset.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.4 <u>Third Party Consents</u>**

To the extent that Seller's rights under any Contract or Governmental Authorization constituting an Asset may not be assigned to Buyer without the Consent of another Person and such Consent is not obtained on or before the Closing, this Agreement shall not constitute an agreement to assign the same if an attempted assignment would constitute a breach thereof or be unlawful, and in such event Seller shall use its reasonable best efforts to obtain any such required Consent(s) as promptly as possible. If any such Consent shall not be obtained or if any attempted assignment would be ineffective or would impair Buyer's rights under the Asset in question so that Buyer would not in effect acquire the benefit of all such rights, Seller, to the maximum extent permitted by law and the Asset, shall act after the Closing as Buyer's agent in order to obtain for it the benefits thereunder and shall cooperate, to the maximum extent permitted by law and the Asset, with Buyer in any other reasonable arrangement designed to provide such benefits to Buyer.

**3. <u>RESERVED</u>**

**4. <u>CLOSING</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.1 <u>Closing</u>**

The purchase and sale provided for in this Agreement (the "<u>Closing</u>") will take place at the offices of Seller, commencing at 10:00 a.m. (local time) on the later of (a) thirty (30) days after the date hereof or (b) the date that is five (5) Business Days following the satisfaction of the closing conditions in <u>Articles 9 and 10</u> (other than those to be satisfied at the Closing), unless Buyer and Seller otherwise agree. The Closing will occur simultaneously with the consummation of the Bottling Transaction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.2 <u>Closing Obligations</u>**

In addition to any other documents to be delivered under other provisions of this Agreement, at the Closing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Seller shall deliver to Buyer:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a bill of sale for all of the Assets that are Tangible Personal Property and Equipment owned by Seller in a form reasonably acceptable to Buyer and Seller (the "<u>Bill of Sale</u>" executed by Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) an assignment of all of the Assets that are intangible personal property in a form reasonably acceptable to Buyer and Seller, which assignment shall also contain Buyer's undertaking and assumption of the Assumed Liabilities (the "<u>Assignment and Assumption Agreement</u>") executed by Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) for each interest in Real Property identified on <u>Schedule 5.7</u>, a recordable limited warranty deed, in the form of <u>Exhibit 1</u> or such other appropriate document or instrument of transfer, as the case may require, each in form and substance satisfactory to Buyer and its counsel and executed by Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) assignments of all Intellectual Property Assets and separate assignments of all registered Marks, Patents, Net Names and Copyrights in a form reasonable acceptable to Buyer and Seller, executed by Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) such other deeds, bills of sale, assignments, certificates of title, documents and other instruments of transfer and conveyance as may reasonably be requested by Buyer, each in form and substance satisfactory to Buyer and its legal counsel and executed by Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) a certificate executed by Seller as to (A) the accuracy of their representations and warranties as of the date of this Agreement and as of the Closing in accordance with <u>Section 9.1</u> and (B) its compliance with and performance of their covenants and obligations to be performed or complied with at or before the Closing in accordance with <u>Section 9.2</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) a certificate of the Secretary of Seller dated the Closing Date, certifying (A) that resolutions authorizing this Agreement and all transactions contemplated hereby has been approved by the written consent of shareholders owning 50% or more of the outstanding common shares of Seller and (B) that all other shareholders of Seller have been sent copies of the resolutions described in clause (A) above;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) a certificate of the President and Secretary of Seller, dated as of the Closing Date, certifying (A) the resolutions duly adopted by the Board of Directors of Seller authorizing and approving the execution, delivery and performance of this Agreement and the consummation of the transaction, contemplated hereby, and (B) that such resolutions have not been rescinded or modified and remain in full force and effect as of the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) a certificate of Good Standing of Seller, certified by the California Secretary of State, dated no earlier than ten (10) days prior to the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) a certificate signed by Seller issued pursuant to and in compliance with Treasury Regulations Section 1.1445-2(b)(2), certifying that Seller is not a foreign person within the meaning of Code Sections 1445; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) such other instruments or documents reasonably deemed necessary by Buyer and its counsel to effect the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Buyer shall deliver to Seller:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Assignment and Assumption Agreement executed by Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a certificate executed by Buyer as to the accuracy of its representations and warranties as of the date of this Agreement and as of the Closing in accordance with <u>Section 10.1</u> and as to its compliance with and performance of its covenants and obligations to be performed or complied with at or before the Closing in accordance with <u>Section 10.2</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) a certificate of the Secretary or Assistant Secretary of Buyer, dated as of the Closing Date, certifying (A) the resolutions duly adopted by the Board of Directors of Buyer authorizing and approving the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, and (B) that such resolutions have not been rescinded or modified and remain in full force and effect as of the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) a Certificate of Good Standing of Buyer, certified by the Nevada Secretary of State, dated no earlier than ten (10) days prior to the Closing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) copies of the TTB Applications;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) evidence of bonding as required by <u>Section 10.6</u> below; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) such other instruments or documents reasonably deemed necessary by Seller and its counsel to effect the transactions contemplated hereby.

**5. <u>REPRESENTATIONS AND WARRANTIES OF SELLER</u>**

Seller represents and warrants to Buyer as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.1 <u>Organization and Good Standing</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Seller is a corporation duly organized and validly existing under the laws of the State of California, with full power and authority to conduct its business as it is now being conducted and to own or use the properties and assets that it purports to own or use. Seller is duly qualified to do business as a foreign limited liability company and is in good standing under the laws of each state or other jurisdiction in which either the ownership or use of the properties owned or used by it, or the nature of the activities conducted by it, requires such qualification. <u>Schedule 5.1</u> lists the jurisdictions in which Seller is qualified to do business. Seller has no subsidiaries and does not own any shares of capital stock or other securities of any other Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) None of the Seller or any of its Affiliates is now or has ever been a Blocked Person. None of Seller or any of its Affiliates, directly or indirectly, (i) conducts or has conducted any business with a Blocked Person, (ii) has contributed any funds, goods or services, to, or received and funds, goods or services from, any Blocked Person, or (iii) has dealt, or otherwise engaged, in any transaction relating to any property or interests in property blocked pursuant to Executive Order 13224.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.2 <u>Enforceability</u>: <u>Authority</u>: <u>No Conflict</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Agreement constitutes the legal, valid and binding obligation of Seller has enforceable against each of them in accordance with its terms. Upon the execution and delivery by Seller each other agreement, instrument, certificate or document to be executed or delivered by any or all of Seller at the Closing (collectively, the "<u>Seller's Closing Documents</u>"), each of Seller's Closing Documents will constitute the legal, valid and binding obligation of Seller enforceable against each of them in accordance with its terms. Seller has the absolute and unrestricted right, power and authority to execute and deliver this Agreement and Seller's Closing Documents to which it is a party and to perform its obligation under this Agreement and Seller's Closing Documents, and such action has been duly authorized by all necessary action by its owners and board of directors (or comparable governing body).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as set forth in <u>Schedule 5.2(b)</u>, neither the execution and delivery of this Agreement nor the consummation or performance of any of the transactions contemplated hereunder will, directly or indirectly (with or without notice or lapse of time):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Breach (A) any provision of any of the articles of organization or operating agreement (or comparable governing documents) of Seller or (B) any resolution adopted by the board of directors (or comparable governing body) or the owners of Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Breach or give any Governmental Body or other Person the right to challenge any of the transactions contemplated hereunder or to exercise any remedy or obtain any relief under any Legal Requirement of any Order to which Seller or any of the Assets, may be subject;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) contravene, conflict with or result in a violation or Breach of any of the terms or requirements of, or give any Governmental Body the right to revoke, withdraw, suspend, cancel, terminate or modify, any Governmental Authorization that is held by Seller or that otherwise relates to the Assets or to the business of Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Breach any provision of, or give any Person the right to declare a default or exercise any remedy under, or to accelerate the maturity or performance of, or payment under, or to cancel, terminate or modify, any Seller Contract related to the Brand; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) result in the imposition or creation of any Encumbrance upon or with respect to any of the Assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as set forth in <u>Schedule 5.2(c)</u>, neither Seller is required to give any notice to or obtain any Consent from any Person in connection with the execution and delivery of this Agreement or the consummation or performance of any of the transactions contemplated hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.3 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.4 <u>Books and Records</u>**

The books of account and other financial records of Seller, all of which have been made available to Buyer, are complete and correct and represent actual, bona fide transactions and have been maintained in accordance with sound business practices, including the maintenance of an adequate system of internal controls.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.5 <u>Sufficiency of Assets</u>**

<u>Schedule 5.5</u> is a true and correct list of all Commonly Used Assets. The Assets (together with any Commonly Used Assets not listed on <u>Exhibit F</u>) (a) constitute all of the assets, tangible and intangible, of any nature whatsoever, necessary to operate the Brand in the manner presently operated by Seller and (b) include all of the operating assets of Seller related to the Brand.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.6 <u>Description of Owned Real Property</u>**

<u>Schedule 5.6</u> contains a correct legal description and street address of all tracts, parcels and subdivided lots in which Seller has an ownership interest related to the Brand.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.7 <u>Leased Real Property</u>**

<u>Schedule 5.7</u> contains a true and correct list of all real property subject to a Lease used in connection with the Brand (the "<u>Leased Property</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.8 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.9 <u>Condition of Facilities</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Use of each parcel of the Real Property for the various purposes for which it is presently being used is permitted as of right under all applicable zoning Legal Requirements and is not subject to "permitted nonconforming" use or structure classifications. All Improvements are in compliance with all applicable Legal Requirements, including those pertaining to zoning, building and the disabled, are in a repair and operating condition sufficient for the operation of the Business in the Ordinary Course of Business. <u>Schedule 5.9(a)</u> lists the material repairs and maintenance to the Improvements that Seller's management currently anticipates. Except as set forth in the Survey, no part of any Improvement encroaches on any real property not included in the definition of Real Property, and there are no buildings, structures, fixtures or other Improvements primarily situated on adjoining property which encroach on any part of any parcel of Real Property. Except as set forth in the Survey, the Real Property for each Facility abuts on and has direct vehicular access to a public road or has access to a public road via a permanent, irrevocable, appurtenant easement benefiting such Real Property and comprising a part of the Real Property, is supplied with public or quasi-public utilities and other services appropriate for the operation of the Facilities located thereon and is not located within any flood plain or area subject to wetlands regulation or any similar restriction. To Seller's Knowledge, there is no existing or proposed plan to modify or realign any street or highway or any existing or proposed eminent domain proceeding that would result in the taking of all or any part of any Facility or that would prevent or hinder the continued use o any Facility as heretofore used in the conduct of the business of Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Tangible Personal Property is in a repair and operating condition sufficient for the operation of the Brand as currently conducted by Seller in the Ordinary Course of Business. <u>Schedule 5.9(b)</u> lists the material repairs and maintenance to the Tangible Personal Property that Seller's management currently anticipates. <u>Schedule 5.9(b)</u> contains true and correct list of all Tangible Personal Property and, except as disclosed in <u>Schedule 5.9(b)</u> all such property is in the possession of Seller, is owned by Seller and free from Encumbrances.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Equipment is in a repair and operating condition sufficient for the operation of the Brand as currently conducted by Seller in the Ordinary Course of Business. <u>Schedule 5.9(c)</u> lists the material repairs and maintenance to the Tangible Personal Property that Seller's management currently anticipates. <u>Schedule 5.9(c)</u> contains a true and correct list of all Equipment and lists and specifically identifies all equipment and parts of equipment that are owned by third parties that are currently in the possess of Seller and used in the Brand. All equipment listed on <u>Schedule 5.10(c)</u> as being owned by Seller is free from all Encumbrances and is in the possession of Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.10 <u>Accounts Receivable</u>**

All Accounts Receivable that are reflected on the Balance Sheet or the Interim Balance Sheet or on the accounting records of Seller as of the Closing Date represent or will represent valid obligations arising from sales actually made or services actually performed by Seller in the Ordinary Course of Business. Except to the extent paid prior to the Closing Date, such Accounts Receivable are or will be as of the Closing Date current and collectible net of the respective reserves shown on the Balance Sheet or the Interim Balance Sheet or on the accounting records of Seller as of the Closing Date (which reserves are adequate and calculated consistent with the practice). Subject to such reserves, each of such Accounts Receivable either has been or will be collected in full, without any setoff, within 90 days after the day on which it first becomes due and payable. There is no contest, claim, defense or right of setoff relating to the amount or validity of such Accounts Receivable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.11 <u>Inventories</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All items included in the Inventories consist of a quality and quantity usable and, with respect to finished good, saleable, in the Ordinary Course of Business of Seller except for obsolete items and items of below-standard quality, all of which have been written off or written down to net realizable value in the Balance Sheet or the Interim Balance Sheet or on the accounting Records of Seller as of the Closing Date, as the case may be. <u>Schedule 5.11(a)</u> sets forth and specifically identifies all inventory not owned by Seller, including goods already sold, raw materials and finished goods owned by third-parties, that is (i) in the possession of Seller, and (ii) is related to the Brand.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as set forth in <u>Schedule 5.11(b)</u>, all of the Inventories have been valued at the lower of cost or market value on a first in, first out basis. Inventories now on hand that were purchased after the date of the Balance Sheet or the Interim Balance Sheet were purchased in the Ordinary Course of Business of Seller at a cost not exceeding market prices prevailing at the time of purchase. The quantities of each item of Inventories (whether raw materials, work-in-process or finished goods) are not excessive but are reasonable in the present circumstances of Seller. Work-in-process Inventories are now valued, and will be valued on the Closing Date, according to GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.12 <u>No Undisclosed Liabilities</u>**

Except as set forth is <u>Schedule 5.12</u>, Seller has no Liability required to be reflected on a balance sheet prepared in accordance with GAAP, except for (i) Liabilities reflected or reserved against in the Balance Sheet or the Interim Balance Sheet and (ii0 current liabilities incurred in the Ordinary Course of Business of Seller since the date of the Interim Balance Sheet none of which are material in amount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.13 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.14 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.15 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.16 <u>Compliance with Legal Requirements: Government Authorizations</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as set forth in <u>Schedule 5.16(a)</u>, Seller is, and at all times since December 31, 2020 has been, in material compliance with each Legal Requirement that is or was applicable to it or to the conduct or operation of its business or the ownership or use of any of its assets and no event has occurred or circumstance exists that may (with or without notice of lapse of time) constitute or result in a violation by Seller of, or a failure on the part of Seller to comply with, any Legal Requirement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) RESERVED

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Governmental Authorization listed in <u>Schedule 5.16(b)</u> collectively constitute all of the Governmental Authorizations necessary to permit Seller to lawfully conduct and operate the Brand in the manner in which it currently conducts and operates such business and necessary for Buyer to lawfully conduct and operate the Brand after he Closing in the manner operated by Seller prior hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.17 <u>Legal Proceedings</u>**

Except as set forth in <u>Schedule 5.17</u>, there is no pending or, to Seller's Knowledge, threatened Proceeding (i) by or against Seller or that otherwise relates to or may affect the business of, or any of the assets owned or used by, Seller; or (ii) that challenges, or that may have the effect of preventing, delaying, making illegal or otherwise interfering with, any of the transactions contemplated hereunder. To the Knowledge of Seller, no event has occurred or circumstance exists that is reasonable likely to give rise to or serve as a basis for the commencement of any such Proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.18 <u>Absence of Certain Changes and Events</u>**

Except as set forth in <u>Schedule 5.18</u>, since the date of the Balance Sheet, Seller has conducted its business only in the Ordinary Course of Business and there has not been any:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) payment (except in the Ordinary Course of Business) or increase by Seller of any bonuses, salaries or other compensation to any member, manager, office or employee of Seller or entry into any employment, severance or severance or similar Contract with any member, manager, office or employee of Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) adoption of, amendment to or increase in the payments to or benefits under, any Employee Plan;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) damage to or destruction or loss exceeding $10,000 with respect to any individual Asset, or exceeding $50,000 in the aggregate with respect to all Assets, whether or not covered by insurance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) entry into, termination of or receipt of notice of termination of (i) any license, distributorship, dealer, sales representative, joint venture, credit or similar Contract to which Seller is a party related to the Brand, or (ii) any Contract or transaction related to the Brand involving a total remaining commitment by Seller of at least $100,000;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) sale (other than sales of Inventories in the Ordinary Course of Business), lease or other disposition of any asset or property of Seller (including the Intellectual Property Assets) related to the Brand or the creation of any Encumbrance on any Asset;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) cancellation or waiver of any claims or rights relating to the Brand with a value to Seller in excess of $50,000;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) indication by any customer or supplier related to the Brand of an intention to discontinue or change the terms of its relationship with Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) material change in the accounting methods used by Seller; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Contract by Seller to do any of the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.19 <u>Contracts; No Defaults</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Schedule 5.19(a)</u> contains an accurate and complete list, and Seller has made available to Buyer through Seller's electronic data room accurate and complete copies, of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) each Seller Contract related to the Brand that involves performance of services or delivery of goods or materials by or to Seller of an amount or value in excess of $50,000;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each Lease by or to Seller of real or personal property related to the Brand;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) each Seller Contract with any labor union or other employee representative of a group of employees relating to wages, hours and other conditions of employment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) each Seller Contract (however named) involving a sharing of profits, losses, costs or Liabilities by Seller with any other Person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) each Seller Contract containing covenants that in any way purport to restrict Seller's business activity, that contains a "most favored nations" provision or similar provision regarding an adjustment in pricing or limits the freedom of Seller to engage in any line of business or to compete with any Person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) each Seller Contract relating to the Brand providing for payments to or by any Person based on sales, purchases or profits, other than direct payments for goods or services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) each power of attorney of Seller relating to the Brand that is currently effective and outstanding;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) each Seller Contract relating to the Brand for capital expenditures in excess of ($25,000);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) each Seller Contract relating to the Brand not denominated in U.S. dollars;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) each written warranty, guaranty and/or other similar undertaking with respect to contractual performance extended by Seller related to the Brand other than in the Ordinary Course of Business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) each Seller Contract with an Affiliate of Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii) each Seller Contract which has a term in excess of one year;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) each Seller Contract pursuant to which Seller stores or warehouses raw materials, products, goods or inventory not owned by Seller whether denominated as a warehouse agreement, aging agreement or otherwise ("<u>Warehouse Agreements</u>") and providing for storage fees in excess of $10,000 per year; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv) each amendment, supplement and modification (whether oral or written) in respect of any of the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as set forth in <u>Schedule 5.19(b)</u> (i) each Contract identified or required to be identified in <u>Schedule 5.19(a)</u> and which is to be assigned to or assumed by Buyer under this Agreement is in full force and effect and is valid and enforceable in accordance with its terms; and (ii) each Contract identified or required to be identified in <u>Schedule 5.19(a)</u> and which is being assigned to or assumed by Buyer is assignable by Seller to Buyer without the Consent of any other Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as set forth in <u>Schedule 5.19(c)</u> (i) Seller is, and at all times has been, in material compliance with all applicable terms and requirements of each Seller Contract which is being assumed by Buyer; (ii) each other Person that has or had any obligation or liability under any Seller Contract which is being assigned to Buyer is, and at all times has been, in material compliance with all applicable terms and requirements of such Contract; and (iii) Seller has not given to or received from any other Person, any notice or other communication (whether oral or written) regarding any actual, alleged, possible or potential violation or Breach of, or default under, any Contract which is being assigned to or assumed by Buyer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) There are no renegotiations of, attempts to renegotiate or outstanding rights to renegotiate any material amounts paid or payable to Seller under any executory Contract relating to the Brand with any Person and no such Person has made written demand for such renegotiation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.20 <u>Insurance</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Seller has made available to Buyer through Seller's electronic data room accurate and complete copies of all policies of insurance (and correspondence relating to coverage thereunder) to which Seller is a party, a list of which is included in <u>Schedule 5.20(a)</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Schedule 5.20(b)</u> describes (i) any self-insurance arrangement by or affecting Seller, including any reserves established thereunder; (ii) any Contract or arrangement, other than a policy of insurance, for the transfer or sharing of any risk to which Seller is a party or which involves the business of Seller; and (iii) all obligations of Seller to provide insurance coverage to Third Parties (for example, under Leases or service agreements) and identifies the policy under which such coverage is provided.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as set forth in <u>Schedule 5.20(c)</u> (i) all policies of insurance to which Seller is a party or that provide coverage to Seller: (A) are valid, outstanding and enforceable; and (B) are sufficient for compliance with all Legal Requirements and Seller Contracts; (ii) Seller has not received (A) any refusal of coverage or any notice that a defense will be afforded with reservation of rights or (B) any notice of cancellation or any other indication that any policy of insurance is no longer in full force or effect or that the issuer of any policy of insurance is not willing or able to perform its obligations thereunder; and (iii) Seller has paid all premiums due, and has otherwise performed all of its obligations, under each policy of insurance to which it is a party or that provides coverage to Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.21 <u>Environmental Matters</u>**

Except as disclosed in <u>Schedule 5.21</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Seller is currently, and at all times prior has been, in material compliance with all Environmental Laws. None of Seller or any agent of the foregoing, has any basis to expect, nor has it received, any actual or threatened order, citation, directive, inquiry, claim, notice or other communication from (i) any Governmental Body or private citizen; or (ii) the current or prior owner or operator of any Facilities, of any actual or potential violation or failure to comply with any Environmental Law, or of any actual or threatened obligation to undertake or bear the cost of any Environmental, Health and Safety Liabilities with respect to any Facility or other property or asset (whether real, personal or mixed) in which Seller has or had an interest, or with respect to any property or Facility at or to which Hazardous Materials were generated, manufactured, refined, transferred, disposed, imported, used or processed by Seller, or from which Hazardous Materials have been transported, treated, stored, handled, transferred, disposed, recycled or received.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No Facility is subject to a lien in favor of a third party for reimbursement of cleanup costs, and there has been no cleanup performed on the Facilities which would entitle a third party lien for reimbursement of its cleanup costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Seller does not have any Environmental, Health and Safety Liabilities with respect to any Facility or with respect to any other property or asset (whether real, personal or mixed) in which Seller (or any predecessor) has or had an interest or at any property geologically or hydrologically adjoining any Facility or any such other property or asset.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) There are no Hazardous Materials present on or in the Environment at any Facility, including any Hazardous Materials contained in barrels, aboveground or underground storage tanks, landfills, land deposits, dumps, equipment (whether movable or fixed) or other containers, either temporary or permanent, and deposited or located in land, water, sumps, or any other part of the Facility or such adjoining property, or incorporated into any structure therein or thereon, except Hazardous Materials stored in material compliance with applicable Environmental Laws. Neither Seller nor any Person for whose conduct it is or may be held responsible, has permitted or conducted, or is aware of, any Hazardous Activity conducted with respect to any Facility or any other property or assets (whether real, personal or mixed) in which Seller has or had an interest except in material compliance with all applicable Environmental Laws and Governmental Authorizations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) There has been no Release of any Hazardous Materials at or from any Facility or from any other property or asset (whether real, personal or mixed) in which Seller has or had an interest, except in material compliance with applicable Environmental Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Seller has delivered to Buyer true and complete copies and results of any reports, studies, analyses, tests, or monitoring possessed or initiated by Seller pertaining to Hazardous Materials or Hazardous Activities in, on, or under the Facilities, or concerning compliance, by Seller or any other Person for whose conduct it is or may be held responsible, with Environmental Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) To Seller's Knowledge, the Facilities do not contain any wetlands, as defined in the Clean Water Act and regulations promulgated thereunder, or similar Legal Requirements, or other especially sensitive or protected areas or species of flora or fauna.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) There are no asbestos fibers or materials or polychlorinated biphenyls on or beneath the Facilities. All underground storage tanks, aboveground tanks and storm system pipes which are included in the Facilities are in material compliance with all applicable Environmental Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Except to the extent set forth in this Agreement, Seller has not expressly assumed the liability of any other Person, nor has Seller agreed to indemnify any other Person, for claims arising out of the Release of Hazardous Materials into the Environment or for any other claims under Environmental Law concerning the Facilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Seller shall furnish to Buyer prior to or at Closing any "disclosure document" required by the Responsible Property Transfer Law of California to the extent such law applies to the Facilities ("Disclosure Document"). Buyer acknowledges the purpose and intent of the Disclosure Document and waives the thirty (30) day deadline for delivery of the Disclosure Document. Not more than thirty (30) days after the Closing Date, Seller shall record the final Disclosure Document in the office of the county recorder of the county in which each Facility is located and shall file a copy of the final Disclosure Document with the California Department of Environmental Management. Seller may, through an independent professional engineer registered under IC 25-31-1 and otherwise in accordance with applicable Legal Requirements, record documents reporting that environmental defects disclosed in the final Disclosure Document have been eliminated from the property.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.22 <u>Employees</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Schedule 5.22(a)</u> contains a complete and accurate list of the following information for each employee, manager, independent contractor, consultant and agent of Seller related to the Brand, including each employee on leave of absence or layoff status: name; job title; date of commencement of employment or engagement; current compensation paid or payable and any change in compensation since December 31, 2010; sick and vacation leave that is accrued but unused; and service credited for purposes of vesting and eligibility to participate under any Employee Plan, or any other employee benefit plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Seller has not violated the Worker Adjustment and Retraining Notification Act (the "<u>WARN Act</u>") or any similar state or local Legal Requirement. During the 90 day period prior to the date of this Agreement, Seller has terminated two (2) employees in total (including employees employed at the Brand and the Bottling and Packaging Business).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) To the Knowledge of Seller, no officer, manager, agent, employee, consultant, or contractor of Seller is bound by any Contract that purports to limit the ability of such officer, manager, agent, employee, consultant, or contractor to engage in or perform any conduct, activity, duties or practice relating to the Brand.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.23 <u>Labor Disputes; Compliance</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Seller has complied in all respects with all Legal Requirements relating to employment practices, terms and conditions of employment, equal employment opportunity, nondiscrimination, immigration, wages, hours, benefits and collective bargaining, labor relations, the payment of social security and similar Taxes and occupational safety and health.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as disclosed in <u>Schedule 5.23(b)</u>, (i) Seller has not been, and is not now, a party to any collective bargaining agreement or other labor contract; (ii) since December 31, 2022, there has not been, there is not presently pending or existing, and to Seller's Knowledge there is not threatened, any strike, slowdown, picketing, work stoppage or employee grievance process involving Seller; (iii) to Seller's Knowledge no event has occurred or circumstance exists that could provide the basis for any work stoppage or other labor dispute; (iv) there is not pending or, to Seller's Knowledge, threatened against or affecting Seller any Proceeding relating to the alleged violation of any Legal Requirement pertaining to labor relations or employment matters, including any charge or complaint filed with the National Labor Relations Board or any comparable Governmental Body, and there is no organizational activity or other labor dispute against or affecting Seller or the Facilities; (v) no application or petition for an election of or for certification of a collective bargaining agent is pending; (vi) no grievance or arbitration Proceeding exists that might have an adverse effect upon Seller or the conduct of its business; (vii) there is no lockout of any employees by Seller, and no such action is contemplated by Seller; and (viii) there has been no charge of discrimination filed against or, to Seller's Knowledge, threatened against Seller with the Equal Employment Opportunity Commission or similar Governmental Body.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.24 <u>Intellectual Property Assets</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The term "<u>Intellectual Property Assets</u>" means all intellectual property owned or licensed (as licensor or licensee) by Seller in which Seller has a proprietary interest and that relates to the Brand including: (i) all assumed fictional business names, trade names, registered and unregistered trademarks, service marks brands and applications, other than those used under a customer license (collectively, "<u>Marks</u>"); (ii) all patents, patent applications and inventions and discoveries that may be patentable (collectively, "<u>Patents</u>"); (iii) all registered and unregistered copyrights in both published works and unpublished works (collectively, "<u>Copyrights</u>"); (iv) all rights in mask works; (v) all know-how, trade secrets, confidential or proprietary information, customer lists, Software, technical information, recipes and formulas of any kind (including proprietary yeasts and yeast cultures, product formulas, fermentation recipes and formulas and brown goods blending formulas and recipes, including without limitation the approved formulas listed in <u>Schedule 5.24(a)</u>), manufacturing processes, data, process technology, plans, drawings and blue prints (collectively, "<u>Trade Secrets</u>"); and (vi) all rights in internet web sites and internet domain names presently used by Seller (collectively "<u>Net Names</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Schedule 5.24(b)</u> contains a complete and accurate list and summary description, including any royalties paid or received by Seller, and Seller has delivered to Buyer accurate and complete copies, of all Seller Contracts relating to the Intellectual Property Assets, except for any license implied by the sale of a product and perpetual, paid-up licenses for commonly available Software programs with a value of less than $5,000 under which Seller is the licensee. There are no outstanding and, to Seller's Knowledge, no threatened disputes or disagreements with respect to any such Contract.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as set forth in <u>Schedule 5.24(c)</u>, the Intellectual Property Assets are all those necessary for the operation of the Brand as it is currently conducted. Seller is the owner or licensee of all right, title and interest in and to each of the Intellectual Property Assets, free and clear of all Encumbrances, and has the right to use without payment to a Third Party all of the Intellectual Property Assets, other than in respect of licenses listed in <u>Schedule 5.24(c)</u>. Except as set forth in <u>Schedule 5.24(c)</u>, all former and current employees of Seller have executed written Contracts with Seller that assign to Seller all rights to any inventions, improvements, discoveries or information relating to the business of Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Schedule 5.24(d)</u> contains a complete and accurate list and summary description of all Patents. All of the issued Patents are currently in compliance with formal legal requirements (including payment of filing, examination and maintenance fees and proofs of working or use), are valid and enforceable, and are not subject to any maintenance fees or taxes or actions falling due within 90 days after the Closing Date. No Patent has been or is now involved in any interference, reissue, reexamination, or opposition Proceeding, and, to Seller's Knowledge, there is no potentially interfering patent or patent application of any Third Party. Except as set forth in <u>Schedule 5.24(d)</u>, (A) no Patent is infringed or, to Seller's Knowledge, has been challenged or threatened in any way and (B) none of the products manufactured or sold, nor any process or know-how used, by Seller infringes or is alleged to infringe any patent or other proprietary right of any other Person. All products made, used or sold under the Patents have been marked with the proper patent notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Schedule 5.24(e)</u> contains a complete and accurate list and summary description of all Marks. Except as set forth in <u>Schedule 5.24(e)</u>, all Marks have been registered with the United States Patent and Trademark Office, are currently in compliance with all formal Legal Requirements (including the timely post-registration filing of affidavits of use and incontestability and renewal applications), are valid and enforceable and are not subject to any maintenance fees or taxes or actions falling due within 90 days after the Closing Date. No Mark has been or is now involved in any opposition, invalidation or cancellation Proceeding and, to Seller's Knowledge, no such action is threatened with respect to any of the Marks. To Seller's Knowledge, there is no potentially interfering trademark or trademark application of any other Person. No Mark is infringed or, to Seller's Knowledge, has been challenged or threatened in any way, and, none of the Marks used by Seller infringes or is alleged to infringe any trade name, trademark or service mark of any other Person. All products and materials containing a Mark bear the proper federal registration notice where permitted by law. Seller has not received any notice challenging any business name, trade name, registered or unregistered trademark or service mark used by Seller under a customer license.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Schedule 5.24(f)</u> contains a complete and accurate list and summary description of all Copyrights. All of the registered Copyrights are currently in material compliance with formal Legal Requirements, are valid and enforceable, and are not subject to any maintenance fees or taxes or actions falling due within 90 days after the date of Closing. To Seller's Knowledge, (i) no Copyright is infringed or has been challenged or threatened in any way, and (ii) none of the subject matter of any of the Copyrights infringes or is alleged to infringe any copyright of any Third Party or is a derivative work based upon the work of any other Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) With respect to each Trade Secret, the documentation relating to such Trade Secret is current, accurate and sufficient in detail and content to identify and explain it and to allow its full and proper use without reliance on the knowledge or memory of any individual. Seller has taken all reasonable precautions to protect the secrecy, confidentiality and value of all Trade Secrets (including the enforcement by Seller of a policy requiring each employee or contractor to execute proprietary information and confidentiality agreements substantially in Seller's standard form, and all current and former employees and contractors of Seller have executed such an agreement). Seller has good title to and an absolute right to use the Trade Secrets, and, the Trade Secrets are not part of the public knowledge or literature and, to Seller's Knowledge, have not been used, divulged or appropriated either for the benefit of any Person (other than Seller) or to the detriment of Seller. To Seller's Knowledge, no Trade Secret is subject to any adverse claim or has been challenged or threatened in any way or infringes any intellectual property right of any other Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Schedule 5.24(h)</u> contains a complete and accurate list and summary description of all Net Names. All Net Names have been registered in the name of Seller. No Net Name has been or is now involved in any dispute, opposition, invalidation or cancellation Proceeding and, to Seller's Knowledge, no such action is threatened with respect to any Net Name. To Seller's Knowledge, (i) no Net Name is infringed or has been challenged, interfered with or threatened in any way, and (ii) no Net Name infringes, interferes with or is alleged to interfere with or infringe the trademark, copyright or domain name of any other Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Schedule 5.24(i)</u> lists all Software (i) owned by Seller and used in connection with the Brand (the "<u>Proprietary Software</u>"), and (ii) used or held for use by Seller in connection with the Brand but that is not owned by Seller, including any commonly available "shrink wrap" Software copyrighted by third parties, (collectively, the "<u>Third-Party Software</u>"). The Proprietary Software and the Third-Party Software constitute all of the material computer Software necessary for the operation of the Brand as currently conducted. No Person other than Seller possesses any current or contingent right to any source code that is part of the Proprietary Software, and Seller has not granted any Person any current or contingent right to any source code that is part of the Proprietary Software. The Proprietary Software, and any Third-Party Software that is incorporated into the Proprietary Software, performs in accordance with the documentation and other written material used in connection therewith, is in machine-readable form and contains all current revisions. The Proprietary Software and, to Seller's Knowledge, the Third-Party Software, is free of material defects in operations and contains no disabling devices. The source code for the Proprietary Software will (and is free from defect that would not enable it to) compile into object code or otherwise be capable of performing the functions described in the documentation pertaining thereto. None of the Proprietary Software has been developed with, or incorporates, any "open-source" code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.25 <u>Compliance With the Bribery Laws, Export Laws, Anti-Terrorism Laws</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Seller and its Affiliates and the respective Representatives of Seller and its Affiliates have not, to obtain or retain business, directly or indirectly offered, paid or promised to pay, or authorized the payment of, any money or other thing of value (including any fee, gift, sample, travel expense or entertainment with a value in excess of one hundred dollars ($100.00) in the aggregate to any one individual in any year) or any commission payment in excess of one percent (1%) of any amount payable, to (i) any person who is an official, officer, agent, employee or representative of any Governmental Body; (ii) any political party or official thereof; (iii) any candidate for political or political party office; or (iv) any other individual or entity while knowing or having reason to believe that all or any portion of such money or thing of value would be offered, given, or promised, directly or indirectly, to any such official, officer, agent, employee, representative, political party, political party official, candidate, individual, or any entity affiliated with such political party or official or political office.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each transaction is properly and accurately recorded on the books and records of Seller, and each document upon which entries in Seller's books and records are based is complete and accurate in all material respects. Seller maintains a system of internal accounting controls adequate to insure that Seller maintains no off-the-books accounts and that Seller's assets are used only in accordance with Seller's management directives.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Seller has at all times been in compliance with all Legal Requirements relating to export control and trade embargoes and all Anti-Terrorism Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Seller has not violated the antiboycott prohibitions contained in 50 U.S.C. sect. 2401 et seq. or taken any action that can be penalized under Section 999 of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.26 <u>Suppliers; Customers; Product Liability; Product Labeling</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Schedule 5.27(a)</u> lists the top ten (10) customers of the Brand by dollar sales volume during the fiscal year ended December 31, 2021. No customer listed in <u>Schedule 5.27(a)</u> hereto has terminated its business relationship with Seller or, to Seller's knowledge, intends to materially reduce the volume of goods or services it is purchasing from the level of goods or services purchased by such customer in 2020.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Schedule 5.26(b)</u> lists the top ten (10) suppliers of the Brand by dollar volume of purchases during the fiscal year ended December 31, 2021. Except as set forth on <u>Schedule 5.26(b)</u>, there are no suppliers of products or services to the Brand which are material to the Brand. None of the suppliers listed in <u>Schedule 5.26(b)</u> has indicated its intention to terminate its business relationship with Seller or, to Seller's Knowledge, intends to terminate or reduce the level of products or services supplied to Seller by more than 20% from the level of products or services supplied by such supplier in 2021, or change the price or terms on which such products or services are sold to Seller by more than 20% compared to calendar year 2021.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as set forth in <u>Schedule 5.26(c)</u>, Seller is not now, and has never been, the subject of any product liability claim or recall in connection with any products designed, manufactured, produced, bottled or sold by Seller; to the Knowledge of Seller no such claim or recall has been threatened, and Seller is not aware of any fact or circumstance reasonably likely to result in any such claim or recall.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Except as set forth in <u>Schedule 5.26(d)</u>, all products packaged or labeled by the Brand have been packaged and labeled in accordance with all applicable Laws, including the Food, Drug and Cosmetic Act and the rules and regulations promulgated pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Except as set forth in <u>Schedule 5.26(e)</u>, Seller has at all times been in material compliance with all applicable Legal Requirements relating to the regulation of alcoholic beverages. Seller has provided Buyer with a true and accurate copy of all correspondence or other documents related to those items listed or required to be listed on <u>Schedule 5.27(e)</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.27 <u>Relationships With Related Persons</u>**

Except as disclosed in <u>Schedule 5.27</u>, Seller has no interest in any property (whether real, personal or mixed and whether tangible or intangible) used in or pertaining to Seller's business. Seller owns of record or as a beneficial owner, an equity interest or any other financial or profit interest in any Person that has (a) had business dealings or a material financial interest in any transaction with Seller other than business dealings or transactions disclosed in <u>Schedule 5.27</u>, each of which has been conducted in the Ordinary Course of Business with Seller at substantially prevailing market prices and on substantially prevailing market terms or (b) engaged in competition with Seller with respect to any line of the products or services of Seller (a "<u>Competing Business</u>") in any market presently served by Seller, except for ownership of less than 1% of the outstanding capital stock of any Competing Business that is publicly traded on any recognized exchange or in the over-the-counter market. Except as set forth in <u>Schedule 5.27</u>, Seller is not a party to any Contract with, or has any claim or right against, Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.28 <u>Brokers or Finders</u>**

Except as set forth in <u>Schedule 5.29</u>, none of Seller, or its respective Representatives have incurred any obligation or liability, contingent or otherwise, for brokerage or finders' fees or agents' commissions or other similar payments in connection with the sale of Seller's business or the Assets or the transactions contemplated hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.29 <u>Warehouse Agreements</u>**

<u>Schedule 5.29</u> contains a true and correct list of all Warehouse Agreements, together with a description of the parties thereto, the term and details as to specific types and quantities of products, goods or inventory being stored or warehoused by Seller for each such agreement. There is no discrepancy between the types and quantities of products, goods or inventory being stored by Seller and the expectations of any other party to any such Warehouse Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.30 <u>Disclosure</u>**

No representation or warranty or other statement made by Seller in this Agreement, the Disclosure Schedule, the certificates delivered pursuant to <u>Section 4.2(a)</u> or otherwise in connection with the transactions contemplated hereunder contains any untrue statement or omits to state a material fact necessary to make any of them, in light of the circumstances in which it was made, not misleading.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.31 <u>No Other Representations</u>**

Buyer acknowledges that Seller has not made and is not making any representations or warranties whatsoever regarding the subject matter of this Agreement, express or implied, except as provided in this Agreement, the Schedules and documents delivered pursuant to this Agreement and the Schedules, and that it is not relying and has not relied on any representations or warranties whatsoever regarding the subject matter of this Agreement, express or implied, except for the representations and warranties set forth in this Agreement, the Schedules and documents delivered pursuant to this Agreement and the Schedules.

**6. <u>REPRESENTATIONS AND WARRANTIES OF BUYER</u>**

Buyer represents and warrants to Seller as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.1 <u>Organization and Good Standing</u>**

Buyer is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada, with full company power and authority to conduct its business as it is now conducted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.2 <u>Authority, No Conflict</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Agreement constitutes the legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms. Upon the execution and delivery by Buyer of the Assignment and Assumption Agreement, the Escrow Agreement and each other agreement to be executed or delivered by Buyer at Closing (collectively, the "<u>Buyer's Closing Documents</u>"), each of the Buyer's Closing Documents will constitute the legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with its respective terms. Buyer has the absolute and unrestricted right, power and authority to execute and deliver this Agreement and the Buyer's Closing Documents and to perform its obligations under this Agreement and the Buyer's Closing Documents, and such action has been duly authorized by all necessary company action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Neither the execution and delivery of this Agreement by Buyer nor the consummation or performance of any of the transactions contemplated hereunder by Buyer will give any Person the right to prevent, delay or otherwise interfere with any of the transactions contemplated hereunder pursuant to (i) any provision of Buyer's articles of organization or operating agreement (or comparable governing documents); (ii) any resolution adopted by the board of managers or the owners of Buyer; (iii) any Legal Requirement or Order to which Buyer may be subject; or (iv) any Contract to which Buyer is a party or by which Buyer may be bound.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Buyer is not and will not be required to obtain any Consent from any Person in connection with the execution and delivery of this Agreement or the consummation or performance of any of the transactions contemplated hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.3 <u>Certain Proceedings</u>**

There is no pending Proceeding that has been commenced against Buyer and that challenges, or may have the effect of preventing, delaying, making illegal or otherwise interfering with, any of the transactions contemplated hereunder. To Buyer's Knowledge, no such Proceeding has been threatened.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.4 <u>Brokers or Finders</u>**

Neither Buyer nor any of its Representatives have incurred any obligation or liability, contingent or otherwise, for brokerage or finders' fees or agents' commissions or other similar payment in connection with the transactions contemplated hereunder.

**7. <u>COVENANTS OF SELLER PRIOR TO CLOSING</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.1 <u>Access and Investigation</u>**

Between the date of this Agreement and the Closing Date, and upon reasonable advance notice received from Buyer, Seller shall:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) afford Buyer and its Representatives and prospective lenders and their Representatives (collectively, "<u>Buyer Group</u>") full and free access, during regular business hours, to Seller's personnel, properties (including subsurface testing), Contracts, Governmental Authorizations, books and records and other documents and data, such rights of access to be exercised in a manner that does not unreasonably interfere with the operations of Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) afford Buyer and its Representatives access to make reasonable installations of cable, telecommunications, internet and other infrastructure necessary or desirable to have the Brand operating, as intended by Buyer, on the Closing Date, particularly with respect to the information technology systems;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) furnish Buyer Group with copies of all such Contracts (related to the Brand), Governmental Authorizations, books and records and other existing documents and data as Buyer may reasonably request;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) furnish Buyer Group with such additional financial, operating and other relevant data and information as Buyer may reasonably request; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) otherwise cooperate and assist, to the extent reasonably requested by Buyer, with Buyer's investigation of the properties, assets and financial condition related to Seller. In addition, Buyer shall have the right to have the Real Property, Leased Property, Inventory and Tangible Personal Property, Equipment and Inventories inspected by Buyer Group, at Buyer's sole cost and expense, for purposes of determining the physical condition and legal characteristics of the Real Property, Leased Property, Tangible Personal Property, Equipment and Inventories, with respect to such matters as Buyer deems appropriate, including elevations and topography, soil conditions, cultural or historical matters, paved areas, storm water drainage, environmental matters, availability of utilities, roof, foundation and other structural and mechanical matters. In the event subsurface or other destructive testing is recommended by any of Buyer Group, Buyer shall be permitted to have the same performed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.2 <u>Operation of the Business of Seller</u>**

Between the date of this Agreement and the Closing, Seller shall:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) conduct its business only in the Ordinary Course of Business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) except as otherwise directed by Buyer in writing, use its Best Efforts to preserve intact its current business organization, keep available the services of its officers, employees and agents and maintain its relations and good will with suppliers, customers, employees, agents and others having business relationships with it;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) confer with Buyer prior to implementing operational decisions of a material nature;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) otherwise report to Buyer concerning the status of its business, operations and finances upon Buyer's request from time to time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) make no material changes in management personnel without prior consent of Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) maintain the Assets in a state of repair and condition that complies with Legal Requirements and in the same manner in which they have been operated and maintained before the date hereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) maintain all data for the [computer] system, and maintain the [computer] license, such that Buyer shall have use of and access to any and all data relating to the Brand at and after Closing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) keep in full force and effect, without amendment, all Contracts and Governmental Authorizations relating to the Brand;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) comply with all Legal Requirements and contractual obligations applicable to the operations of Seller's business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) continue in full force and effect the insurance coverage under the policies set forth in <u>Schedule 5.21</u> or substantially equivalent policies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) except as required to comply with ERISA or to maintain qualification under Section 401(a) of the Code, not amend, modify or terminate any Employee Plan without the express written consent of Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) cooperate with Buyer and assist Buyer in identifying the Governmental Authorizations required by Buyer to operate the Brand from and after the Closing Date and either transferring existing Governmental Authorizations of Seller to Buyer, where permissible, or obtaining new Governmental Authorizations for Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) upon request from time to time, execute and deliver all documents and do all other acts that may be reasonably necessary or desirable in the opinion of Buyer to consummate the Contemplated Transactions, all without further consideration;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) maintain all books and records of Seller relating to the Brand in the Ordinary Course of Business; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) provide written reports to Buyer by noon on Friday of each week setting forth Seller's planned distillery inventory production and planned purchases of grain stock, distillers' dried grain and coal for the following week.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.3 <u>Negative Covenant</u>**

Except as otherwise expressly permitted herein, between the date of this Agreement and the Closing Date, Seller shall not, without the prior written Consent of Buyer, (a) take any affirmative action, or fail to take any reasonable action within its control, as a result of which any of the changes or events listed in <u>Sections 5.15 or 5.19</u> would be likely to occur; (b) make any modification to any Contract (of a type required to be listed in <u>Schedule 5.20(a)</u>) or Governmental Authorization or enter into any Contract (of a type required to be listed in <u>Schedule 5.20(a)</u>) (c) allow the levels of Regular Stock, Grain Stock, Coal Stockpiles and other levels of raw materials, work-in-process, supplies or other materials included in the Inventories to exceed at any time the average levels of each such item during the three months immediately preceding the date of this Agreement; or (d) enter into any compromise or settlement of any litigation, proceeding or governmental investigation relating to the Assets, the business of Seller or the Assumed Liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.4 <u>Required Approvals</u>**

As promptly as practicable after the date of this Agreement, Seller shall make all filings required by Legal Requirements to be made by it in order to consummate the transactions contemplated hereunder. Seller shall (i) cooperate with Buyer and its Representatives with respect to all filings that Buyer elects to make or, pursuant to Legal Requirements, shall be required to make in connection with the transactions contemplated hereunder; and (ii) cooperate with Buyer and its Representatives in obtaining all Consents necessary for the consummation of the transactions contemplated hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.5 <u>Notification</u>**

Between the date of this Agreement and the Closing, Seller shall promptly notify Buyer in writing if any of them becomes aware of (a) any fact or condition that causes or constitutes a Breach of any of Seller's representations and warranties made as of the date of this Agreement or (b) the occurrence after the date of this Agreement of any fact or condition that would be reasonably likely to cause or constitute a Breach of any such representation or warranty had that representation or warranty been made as of the time of the occurrence of, or Seller's discovery of, such fact or condition. Such notification shall not affect any rights of Buyer under <u>Section 11.2</u> and <u>Article 13</u>. During the same period, Seller also shall promptly notify Buyer of the occurrence of any Breach of any covenant of Seller in this <u>Article 7</u> or of the occurrence of any event that may make the satisfaction of the conditions in <u>Article 9</u> impossible or unlikely.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.6 <u>No Negotiation</u>**

Until such time as this Agreement shall be terminated pursuant to <u>Section 11.1</u>, Seller shall not and shall cause its Affiliates, Representatives and Related Persons not to, directly or indirectly solicit, initiate, encourage or entertain any inquiries or proposals of any type or enter into any confidential agreement, letter of intent, purchase agreement, merger agreement or similar agreement with or provide any information to any Person (other than Buyer) relating to any business combination transaction involving Seller, including the sale of Seller's equity, the merger or consolidation of Seller or the sale of Seller's business or assets, the liquidation or similar extraordinary transaction with respect to Seller. Seller shall notify Buyer of any such inquiry or proposal within 24 hours of receipt or awareness of the same by Seller. Promptly after the date hereof, Seller will, and will cause their Representatives to, terminate any such negotiations or discussions ongoing prior to the date hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.7 <u>Change of Name</u>**

On or before the Closing Date, Seller shall (a) amend its articles of organization and operating agreement (and other comparable governing documents) and take all other actions necessary to change its name to one sufficiently dissimilar to Seller's present name, in Buyer's judgment, to avoid confusion and (b) take all actions requested by Buyer to enable Buyer, if it so chooses, to change its name to Seller's present name.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.8 <u>Payment of Liabilities</u>**

Seller shall pay or otherwise satisfy in the Ordinary Course of Business all of its Liabilities and obligations. Buyer and Seller hereby waive compliance with any bulk-transfer provisions of the Uniform Commercial Code (or any similar law) ("<u>Bulk Sales Laws</u>") in connection with the transactions contemplated herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.9 <u>RESERVED</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.10 <u>WARN Act</u>**

Immediately after the date of this Agreement, Seller shall deliver WARN notices in a form or forms as required by the WARN Act (and applicable Legal Requirements) to each Person who is entitled by the WARN Act to receive such notice in connection with the transactions set forth herein [and with respect to the Bottling Transaction] and will supplement or issue such additional notice or notices as required by the WARN Act or other Legal Requirements, including without limitation, to address any potential delays in Closing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.11 <u>RESERVED</u>**

**8. <u>COVENANTS OF SELLER PRIOR TO CLOSING</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.1 <u>Required Approvals</u>**

As promptly as practicable after the date of this Agreement, Buyer shall make, or cause to be made, all filings required by Legal Requirements to be made by it to consummate the transactions contemplated hereunder. Buyer also shall cooperate, and cause its Related Persons to cooperate, with Seller (a) with respect to all filings Seller shall be required by Legal Requirements to make and (b) in obtaining all Consents identified in <u>Schedule 5.2(c)</u>; <u>provided</u>, <u>however</u>, that Buyer shall not be required to dispose of or make any change to its business, expend any material funds or incur any other burden in order to comply with this <u>Section 8.1</u>.

**9. <u>CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE</u>**

Buyer's obligation to purchase the Assets and to take the other actions required to be taken by Buyer at the Closing is subject to the satisfaction, at or prior to the Closing, of each of the following conditions (any of which may be waived by Buyer, in whole or in part):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.1 <u>Accuracy of Representations</u>**

All representations and warranties of Seller and Elite Beverage International, Inc., in this Agreement shall have been true and correct in all material respects as of the date of this Agreement, and shall be true and correct in all material respects as of the time of the Closing as if then made, except the representations and warranties in Sections 5.1, 5.2, and 5.29 shall be true and correct in all respects and that in determining the accuracy of representations and warranties in this Section 9.1, all qualifications of "material", "materially", "materiality" or similar limitations shall be disregarded.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.2 <u>Seller's Performance</u>**

All of the covenants and obligations that Seller is required to perform or to comply with pursuant to this Agreement at or prior to the Closing shall have been duly performed and complied with in all material respects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.3 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.4 <u>Additional Documents</u>**

Seller shall have caused the documents and instruments required by <u>Section 4.2(a)</u> and the following documents to be delivered (or tendered subject only to Closing) to Buyer:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If requested by Buyer, any Consents or other instruments that may be required to permit Buyer's qualification in each jurisdiction in which Seller is licensed or qualified to do business as a foreign corporation under the name "Elite Beverage International, Inc." or any derivative thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Releases of all Encumbrances on the Assets, other than Permitted Encumbrances, including releases of each mortgage of record and reconveyances of each deed of trust with respect to each parcel of real property included in the Assets; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Certificates dated as of a date not earlier than the tenth Business Day prior to the Closing as to the payment of all applicable state Taxes by Seller, executed by the appropriate officials of the State of Indiana and each jurisdiction in which Seller is licensed or qualified to do business as a foreign company as specified in <u>Schedule 5.1(a)</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.5 <u>No Proceedings</u>**

There shall not have been commenced or threatened against Buyer, or against any Related Person of Buyer, or against Seller or against any Related Person of Seller any Proceeding (i) involving any challenge to, or seeking Damages or other relief in connection with, any of the transactions contemplated hereunder or (ii) that may have the effect of preventing, delaying, making illegal, imposing limitations or conditions on or otherwise interfering with any of the transactions contemplated hereunder. There shall not be in effect any Legal Requirement or any injunction or other Order that (y) prohibits the consummation of the transactions contemplated hereunder or (z) has been adopted or issued, or has otherwise become effective, since the date of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.6 [RESERVED]**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.7 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.8 <u>Governmental Authorization</u>**

Buyer shall have received such Governmental Authorizations as are necessary or desirable to allow Buyer to operate the Assets and the Brand from and after the Closing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.9 <u>Environmental Report</u>**

Buyer at its expense shall have ordered and received an environmental site assessment report with respect to Seller's Facilities, which report shall be acceptable in form and substance to Buyer in its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.10 <u>Employees</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Buyer shall have entered into employment agreements with those employees of Seller identified in <u>Exhibit K</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Those key employees of Seller identified on <u>Exhibit K</u>, or substitutes therefor who shall be acceptable to Buyer, in its sole discretion, shall have accepted employment with Buyer with such employment to commence on and as of the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.11 <u>Due Diligence</u>**

Buyer shall be satisfied, in its sole and absolute discretion, with the results of its business, legal, accounting and other due diligence investigations of Seller, the Assets and the Brand.

**10. <u>CONDITIIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE</u>**

Seller's obligation to sell the Assets and Seller's obligation to take the other actions required to be taken by Seller at the Closing is subject to the satisfaction, at or prior to the Closing, of each of the following conditions (any of which may be waived by Seller in whole or in part):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.1 <u>Accuracy of Representations</u>**

All representations and warranties of Buyer in this Agreement shall have been true and correct in all material respects as of the date of this Agreement and shall be true and correct in all material respects as of the time of the Closing as if then made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.2 <u>Buyer's Performance</u>**

All of the covenants and obligations that Buyer is required to perform or to comply with pursuant to this Agreement at or prior to the Closing shall have been performed and complied with in all material respects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.3 <u>No Injunction</u>**

There shall not be in effect any Legal Requirement or any injunction or other Order that (i) prohibits the consummation of the transactions contemplated hereunder and (ii) has been adopted or issued, or has otherwise become effective, since the date of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.4 <u>TBD Application</u>**

On or before the Closing Date, the Buyer shall have filed with the U.S. Alcohol and Tobacco Tax and Trade Bureau ("TTB") and furnished to the Seller copies of the following TTB permit applications with respect to the Premises (collectively, the "TTB Applications"): (a) distilled spirit plant permit; (b) basic permit; and (c) operating permit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.5 <u>Distilled Spirits Bond</u>**

On or before the Closing Date, the Buyer shall have posted an appropriate distilled spirits bond in favor of the TTB to secure the Buyer's tax obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.6 <u>Utilities</u>**

Buyer shall have furnished the Seller with evidence satisfactory to the Seller that all utility service with respect to the Premises has been changed such that Buyer shall be financially responsible for such all service on and after the Effective Time.

**11. <u>TERMINATION</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.1 <u>Termination Events</u>**

By notice given prior to or at the Closing, subject to <u>Section 11.2</u>, this Agreement may be terminated as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) by Buyer if a material Breach of any provision of this Agreement has been committed by Seller and such Breach has not been waived by Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) by Seller if a material Breach of any provision of this Agreement has been committed by Buyer and such Breach has not been waived by Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) by Buyer if satisfaction of any condition in <u>Article 9</u> is or becomes impossible prior to the Outside Closing Date (as defined below) (other than through the failure of Buyer to comply with its obligations under this Agreement), and Buyer has not waived such condition on or before such date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) by Seller if satisfaction of any condition in <u>Article 10</u> is or becomes impossible prior to the Outside Closing Date (other than through the failure of Seller to comply with their obligations under this Agreement), and Seller has not waived such condition on or before such date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) by mutual consent of Buyer and Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) by Buyer if the Closing has not occurred on or before the Outside Closing Date or such later date as the parties may agree upon, unless the Buyer is in material Breach of this Agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) by Seller if the Closing has not occurred on or before the Outside Closing Date, or such later date as the parties may agree upon, unless Seller is in material Breach of this Agreement.

For purposes hereof, "<u>Outside Closing Date</u>" shall mean December 31, 2024; provided, however, the Outside Closing Date shall be extended to May 31, 2025 if, despite their respective Best Efforts, either Buyer or Bottling Acquiror has not received Governmental Authorizations prior to December 31, 2024 as are necessary for Buyer or Bottling Acquiror to operate the Brand or Bottling and Packaging Business, respectively, from and after the Closing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.2 <u>Effect of Termination</u>**

Each party's right of termination under <u>Section 11.1</u> is in addition to any other rights it may have under this Agreement or otherwise, and the exercise of such right of termination will not be an election of remedies. If this Agreement is terminated pursuant to <u>Section 11.1</u>, all obligations of the parties under this Agreement will terminate, except that the obligations of the parties in this <u>Section 11.2</u> and <u>Articles 14 and 15</u> will survive; <u>provided</u>, <u>however</u>, that, if this Agreement is terminated because of a Breach of this Agreement by the non-terminating party or because one or more of the conditions to the terminating party's obligations under this Agreement is not satisfied as a result of the party's failure to comply with its obligations under this Agreement, the terminating party's right to pursue all legal remedies will survive such termination unimpaired.

**12. <u>ADDITIONAL COVENANTS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.1 <u>Employees and Employee Benefits</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Information on Active Employees. For the purpose of this Agreement, the term "<u>Active Employees</u>" shall mean all employees employed on the Closing Date by Seller for the Brand who are (i) bargaining unit employees currently covered by a collective bargaining agreement, or (ii) employed in the Brand as currently conducted, including employees on temporary leave of absence, including family medical leave, military leave, temporary disability or sick leave, but excluding employees on long-term disability leave.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Employment of Active Employees by Buyer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Buyer is not obligated to hire any Active Employee but may interview all Active Employees. Within seven (7) days of the Closing Date, Buyer will provide Seller with a list of Active Employees to whom Buyer has made an offer of employment that has been accepted to be effective on the Closing Date (the "<u>Hired Active Employees</u>"). Subject to Legal Requirements, Buyer will have reasonable access to the Facilities and personnel records (including performance appraisals and disciplinary actions, but excluding medical records and grievances) of Seller for the purpose of preparing for and conducting employment interviews with all Active Employees and will conduct the interviews as expeditiously as possible prior to the Closing Date. Effective immediately before the Closing, Seller will terminate the employment of all Hired Active Employees and all other Active Employees, other than any such Active Employee who is specifically retained by Seller beyond the Closing Date, and Seller shall be obligated to meet all of its legal obligations to the terminated Hired Active Employees, terminated Active Employees and all Active Employees retained by Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) None of Seller or their Related Persons shall solicit the continued employment of any Active Employee (unless and until Buyer has informed Seller in writing that the particular Active Employee will not receive any employment offer from Buyer) or the employment of any Hired Active Employee after the Closing. Buyer shall inform Seller of the identities of those Active Employees to whom it will not make employment offers and Buyer shall have no obligation to the Seller in connection with Seller's duties in complying with the WARN Act as to any Active Employees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) It is understood and agreed that (A) Buyer's expressed intention to extend offers of employment, if any, as referenced in this <u>Section 12.1</u> shall not constitute any commitment, Contract or understanding (expressed or implied) of any obligation on the part of Buyer to a post-Closing employment relationship of any fixed term or duration or upon any terms or conditions other than those that Buyer may establish pursuant to individual offers of employment, and (B) employment offered by Buyer is "at will" and may be terminated by Buyer or by an employee at any time for any reason (subject to any written commitments to the contrary made by Buyer or an employee and Legal Requirements). Nothing in this Agreement shall be deemed to prevent or restrict in any way the right of Buyer to terminate, reassign, promote or demote any of the Hired Active Employees after the Closing or to change adversely or favorably the title, powers, duties, responsibilities, functions, locations, salaries, other compensation or terms or conditions of employment of such employees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Salaries and Benefits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Seller shall be responsible for (A) the payment of all wages and other remuneration due to all Seller's employees, whether or not such employee becomes a Hired Active Employee, with respect to their services as employees of Seller through the Effective Time on the Closing Date, including pro rata bonus payments and payments, whether or not paid pursuant to any Legal Requirement, that may be paid with respect to vacation, sick, or other leave accrued prior to the Closing Date; and (B) the payment of any termination or severance payments that may be due to any employee of Seller, whether or not such employee becomes a Hired Active Employee; and (C) any and all payments to current or former employees of Seller required under the WARN Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Seller shall be liable for any claims made or incurred by Active Employees and their beneficiaries under the Employee Plans.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Seller shall be responsible and liable for providing continuation coverage mandated by COBRA under a group health care plan maintained by Seller for any current or former employee of Seller, or any qualified beneficiary thereof, within the meaning of Code Section 4980B(g)(1), who, as of the Closing Date, is (A) entitled to such continuation coverage as a result of a qualifying event (as defined in Section 4980B of the Code) that occurred before or occurs in connection with the transactions contemplated by this Agreement or the Bottling Transaction, including continuation coverage for any Active Employee who does not become a Hired Active Employee, or (B) receiving continuation coverage under a group health care plan sponsored by Seller or ERISA Affiliate. Notwithstanding any other provision of this Agreement to the contrary, should Seller cease to maintain any group health plan such that the obligation to provide COBRA continuation coverage to all persons who are "M&A qualified beneficiaries" (as described in IRS Regulation Section 54.498B-9, Q&A-4) with respect to the transactions contemplated by this Agreement ("COBRA Beneficiaries") shifts to Buyer by operation of law, Seller and the Parent Company, jointly and severally, shall reimburse Buyer for any and all expenses incurred (including, but not limited to, claims incurred under the group health plan, administrative fees, insurance or reinsurance premiums, etc.) by Buyer or its Affiliates or any plans of Buyer or its Affiliates in excess of the premiums collected from the COBRA Beneficiaries and any actual reinsurance recoveries to the extent attributable to COBRA continuation coverage provided to the COBRA Beneficiaries. Buyer shall invoice Seller and the Parent Company monthly with respect to such expenses, and Seller and the Parent Company shall be obligated to make full payment of each such invoice within thirty (30) days of the date of receipt of such invoice. If the Seller and the Parent Company should fail to timely make payment with respect to any such invoice, the Seller and the Parent Company shall also be obligated to pay interest with respect to the unpaid amounts at the rate of ten percent (10%) per annum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Buyer shall not have any responsibility, liability or obligation, whether to Active Employees, former employees, their beneficiaries or to any other Person, with respect to the Employee Plans (including the establishment, operation or termination thereof and the notification and provision of COBRA coverage extension).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Seller's Retirement and Savings Plans. All Hired Active Employees who are participants in Seller's retirement plans shall retain their accrued benefits under Seller's retirement plans as of the Closing Date, and Seller (or Seller's retirement plans) shall retain sole liability for the payment of such benefits as and when such Hired Active Employees become eligible therefor under such plans. All Hired Active Employees shall become fully vested in their accrued benefits under Seller's retirement plans as of the Closing Date, and Seller will so amend such plans if necessary to achieve this result.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Collective Bargaining Matters. Buyer will set its own initial terms and conditions of employment for the Hired Active Employees and others it may hire, including work rules, benefits and salary and wage structure, all as permitted by law. Buyer is not obligated to assume any collective bargaining agreements under this Agreement. Seller shall be solely liable for any severance payment required to be made to its employees due to the transactions contemplated hereunder. Any bargaining obligations of Buyer, if any, with any union with respect to bargaining unit employees subsequent to the Closing, shall be the sole responsibility of Buyer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Prior to the Closing Date, the Seller shall take all action necessary to correct (whether under the United States Department of Labor Voluntary Fiduciary Correction Program or otherwise) or pay Taxes with respect to any "prohibited transactions" within the meaning of Section 406 or 407 of ERISA or Section 4975 of the Code for which a statutory or administrative exemption does not exist that have occurred with respect to any Employee Plan prior to Closing. Seller shall provide evidence of such correction to Buyer no later than five days prior to the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.2 <u>Payment of All Taxes Resulting From Sale of Assets By Seller</u>**

Seller shall pay in a timely manner all Taxes resulting from or payable in connection with the sale of the Assets pursuant to this Agreement, regardless of the Person on whom such Taxes are imposed by Legal Requirements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.3 <u>Payment of Other Retained Liabilities</u>**

In addition to payment of Taxes pursuant to <u>Section 12.2</u>, Seller shall pay, or make adequate provision for the payment, in full all of the Retained Liabilities and other Liabilities of Seller under this Agreement. If any such Liabilities are not so paid or provided for, or if Buyer reasonably determines that failure to make any payments will impair Buyer's use or enjoyment of the Assets or conduct of the business previously conducted by Seller with the Assets, Buyer may, at any time after the Closing Date, elect to make all such payments directly (but shall have no obligation to do so) and set off and deduct the full amount of all such payments from any amounts owed to Seller. Buyer shall receive full credit under this Agreement for all payments so made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.4 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.5 <u>Retention of and Access to Records</u>**

At the Closing, Seller shall provide Buyer ownership of the originals of any and all documents, statements, data and records of Seller that relate to any business, employment (excluding any medical records), financial, tax or accounting matters of Seller, including historical financial statements, financial and accounting records and data, and all other documents, records or data relating to accounts payable, accounts receivable, customers, suppliers, employees (excluding medical records) or other financial, tax or accounting matters of Seller (other than Seller's minute books and stock records of which Seller shall provide Buyer copies). After the Closing Date, Buyer shall provide Seller and its Representatives reasonable access to such records during normal business hours and on at least three days' prior written notice, for any reasonable business purpose specified by Seller in such notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.6 <u>Further Assurances</u>**

Subject to the proviso in <u>Section 8.1</u>, the parties shall cooperate reasonably with each other and with their respective Representatives in connection with any steps required to be taken as part of their respective obligations under this Agreement, and shall (a) furnish upon request to each other such further information that any party hereto may reasonably request; (b) execute and deliver to each other party such other documents as such other party may reasonably request; and (c) do such other acts and things, all as the other party may reasonably request for the purpose of carrying out the intent of this Agreement and the transactions contemplated hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.7 <u>Refunds and Remittances</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If after the Closing Seller or any of its Affiliates receives any amount which is an Asset or is otherwise properly due and owing to Buyer or any of its Affiliates under this Agreement, Seller shall promptly remit, or shall cause to be remitted, such amount to Buyer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If after the Closing Buyer or any of its Affiliates receives any amount which is an Excluded Asset or is otherwise properly due and owing to Seller or any of its Affiliates under this Agreement, Buyer shall promptly remit, or shall cause to be remitted, such amount to Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.8 <u>Insurance</u>**

Seller shall name Buyer as an additional insured on all policies of insurance insuring them with respect to any and all of the products manufactured, assembled, packaged, bottled or sold prior to the Closing by Seller. At the Closing, Seller shall deliver to Buyer certificate of insurance evidencing such coverage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.9 <u>IT Transition</u>**

For a period of 12 months after the Closing (the "<u>Transition Period</u>"), Seller shall maintain its information technology systems such that Buyer may use all such systems to operate the Brand. In exchange for maintaining Seller's systems for 12 months. Buyer agrees to reimburse Seller 50% percent of the monthly fees payable under the Contract during the Transition Period.

**13 <u>INDEMNIFICATION; REMEDIES</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.1 <u>Survival</u>**

All representations, warranties, covenants and obligations in this Agreement, the Disclosure Schedule, any supplements to the Disclosure Schedule, the certificates delivered pursuant to <u>Section 4.2</u> and any other certificate or document delivered pursuant to this Agreement shall survive the Closing and the consummation of the transactions contemplated hereunder, subject to <u>Section 13.6</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.2 <u>Indemnification and Reimbursement by Seller and Parent Company</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) From and after the Closing, Seller will indemnify and hold harmless Buyer, and its Representatives, owners, subsidiaries and Related Persons (collectively, the "<u>Buyer Indemnified Persons</u>"), and will reimburse the Buyer Indemnified Persons for any loss, liability, claim, damage, expense (including costs of investigation and defense and reasonable attorneys' fees and expenses) or diminution of value, whether or not involving a Third-Party Claim (collectively, "<u>Damages</u>"), arising from or in connection with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any Breach of any representation or warranty made by Seller in this Agreement (without giving effect to any supplement to the Disclosure Schedule) or in any certificate, document, writing or instrument delivered by Seller pursuant to this Agreement (without giving effect to any qualifiers or exceptions relating to materiality);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any Breach of any covenant or obligation of Seller in this Agreement or in any other certificate, document, writing or instrument delivered by Seller pursuant to this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any brokerage or finder's fees or commissions or similar payments based upon any agreement or understanding made, or alleged to have been made, by any Person with Seller (or any Person acting on their behalf) in connection with any of the transactions contemplated hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any Liability arising out of or with respect to any Warehouse Agreements, including based on discrepancies or claimed discrepancies between the types and quantities of products, goods or inventory being stored by Seller at Closing and the expectations of any other party to any such Warehouse Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) any matter disclosed in <u>Schedules 5.18(a)</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) any noncompliance with any Bulk Sales Laws or fraudulent transfer law in respect of the transactions contemplated hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) any liability under the WARN Act or any similar state or local Legal Requirement that may result from an "<u>Employment Loss</u>", as defined by 29 U.S.C. sect. 2101(a)(6), caused by any action or inaction of Seller prior to the Closing or by Buyer's decision not to hire previous employees of Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) any matter related to the Excluded Assets; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) any Retained Liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.3 <u>Indemnification and Reimbursement by Seller – Environmental Matters</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In addition to the other indemnification provisions in this <u>Article 13</u>, from and after the Closing, Seller will indemnify and hold harmless the Buyer Indemnified Persons, and will reimburse the Buyer Indemnified Persons for any Damages (including costs of cleanup, containment or other remediation) arising from or in connection with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any Environmental, Health and Safety Liabilities arising out of or relating to: (i) the ownership or operation by any Person at any time on or prior to the Closing Date of any of the Facilities, Assets or the business of Seller, and the Excluded Assets or (ii) any Hazardous Materials or other contaminants that were present on the Facilities or Assets at any time on or prior to the Closing Date; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any bodily injury (including illness, disability and death, regardless of when any such bodily injury occurred, was incurred or manifested itself), personal injury, property damage (including trespass, nuisance, wrongful eviction and deprivation of the use of real property) or other damage of or to any Person or any assets in any way arising from or allegedly arising from any Hazardous Activity conducted by any Person with respect to the business of Seller or the Assets prior to the Closing Date or from any Hazardous Material that was (i) present or suspected to be present on or before the Closing Date on or at the Facilities (or present or suspected to be present on any other property, if such Hazardous Material emanated or allegedly emanated from any Facility and was present or suspected to be present on any Facility, on or prior to the Closing Date) or (ii) Released or allegedly Released by any Person on or at any Facilities or Assets at any time on or prior to the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Notwithstanding <u>Section 13.3(a)</u> above, Seller shall not:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) be required to remove or pay costs associated with the abatement or removal of asbestos as disclosed in <u>Schedule 13.3</u> but shall remain liable for and jointly and severally indemnify the Buyer Indemnified Parties for any other Damages associated with such asbestos (including claims for death or personal injury to any person); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) be liable to the Buyer Indemnified Persons for Damages in connection with injury to individuals or damage to the property of any third party caused by Hazardous Materials used or produced in the Ordinary Course of the Brand that are disclosed by Seller in the Disclosure Schedules to this Agreement to the extent, and only to the extent, such Damages result solely from exposure after the Closing to such Hazardous Materials at the real property acquired by Buyer hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Buyer will be entitled to control any Remedial Action, any Proceeding relating to an Environmental Claim and, except as provided in the following sentence, any other Proceeding with respect to which indemnity may be sought under this <u>Section 13.3</u>. The procedure described in <u>Section 13.8</u> will apply to any claim solely for monetary damages relating to a matter covered by this <u>Section 13.3</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.4 <u>Indemnification and Reimbursement by Buyer</u>**

From and after the Closing, Buyer will indemnify and hold harmless Seller, and will reimburse Seller for any Damages arising from or in connection with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any Breach of any representation or warranty made by Buyer in this Agreement or in any certificate, document, writing or instrument delivered by Buyer pursuant to this Agreement (without giving effect to any qualifiers or exceptions relating to materiality);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any Breach of any covenant or obligation of Buyer in this Agreement or in any other certificate, document, writing or instrument delivered by Buyer pursuant to this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any claim by any Person for brokerage or finder's fees or commissions or similar payments based upon any agreement or understanding alleged to have been made by such Person with Buyer (or any Person acting on Buyer's behalf) in connection with any of the transactions contemplated hereunder; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any Assumed Liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.5 <u>Limitations of Liability</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject in all respects to <u>Section 13.5(f)</u> below, Seller shall have no liability (for indemnification or otherwise) with respect to claims under <u>Section 13.2(a)(i)</u> (other than with respect to any claim for the Breach of any representation or warranty set forth in <u>Sections 5.1, 5.2, 5.9, 5.14, 5.16</u>, <u>5.22</u> or <u>5.29</u>, to which the limitations set forth in this <u>Section 13.5(a)</u> shall not apply) until the total of all Damages with respect to such matters exceeds $100,000 (the "<u>Deductible"</u>), in which event Seller shall be responsible only for Damages relating thereto in excess of the Deductible up to $2,000,000 (the "<u>Cap</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subject in all respects to <u>Section 13.5(f)</u> below, Seller shall have no liability (for indemnification or otherwise) under <u>Section 13.2(a)(i)</u> for the Breach of any representation or warranty set forth in <u>Sections 5.1, 5.2, 5.9, 5.16</u>, <u>5.22</u> and <u>5.29</u> for any Damages relating thereto in excess of [the Purchase Price.]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Subject in all respects to <u>Section 13.5(f)</u> below, Seller shall have no liability (for indemnification or otherwise) under <u>Section 13.2(a)(viii) and (ix)</u> for any Damages relating thereto in excess of the Purchase Price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Subject in all respects to <u>Section 13.5(f)</u> below, Seller shall have no liability (for indemnification or otherwise) under <u>Section 13.3</u> for any Damages relating thereto in excess of the [Purchase Price.]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Subject in all respects to <u>Section 13.5(f)</u> below, in the event that Buyer Indemnified Persons suffer any Damages in respect of any Retained Liability and such Damages also result from the breach of a representation or warranty hereunder by Seller for which Buyer Indemnified Persons may assert a claim for indemnification under <u>Section 13.2(a)(i)</u> above, such Damages shall be subject to the limitations set forth in <u>Sections 13.5(a)</u> and <u>(b)</u> above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Notwithstanding any other provision of this Agreement, or any other document, instrument or agreement, to the contrary, including the provisions of <u>Sections 13.5(a)</u> through <u>(e)</u> above, and <u>Section 13.6</u>, Seller shall indemnify and hold the Buyer Indemnified Parties harmless from any and all Damages (without any limitation whatsoever as to amount or duration) arising from, through or in any manner relating to any of the following Liabilities (whether resulting from a Breach of any representation or warranty, such Liabilities being characterized as Retained Liabilities hereunder, or otherwise):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any and all Liabilities for Taxes of Seller or any of its Affiliates, whether relating to the Brand,[ the Bottling and Packaging Business,] or otherwise (other than to the extent such Taxes are Assumed Liabilities under <u>Section 2.3(a)(iii)</u> above);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Any and all Liabilities for Indebtedness;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Any and all Liabilities relating to any Proceeding pending as of the Effective Time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Liabilities associated with, or arising from, through or in any manner relating to, the Bottling and Packaging Business prior to the Effective Time; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Damages resulting from any fraud or intentional misrepresentation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.6 <u>Time Limitations</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If the Closing occurs, Seller will have liability (for indemnification or otherwise) with respect to <u>Section 13.2(a)(i)</u> only if on or before twenty-four (24) months from the Closing Date, Buyer notifies Seller or Parent Company of a claim specifying the factual basis of the claim in reasonable detail to the extent then known by Buyer; <u>provided, however</u>, claims with respect to <u>Sections 5.1, 5.2, 5.9</u> and <u>5.29</u> may be made indefinitely, and claims with respect to <u>Sections 5.14</u>, <u>5.16</u> and <u>5.22</u> may be made at any time within 45 days after the date on which the statute of limitations applicable to the matter covered by such representations and warranties expires.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If the Closing occurs, Buyer will have liability (for indemnification or otherwise) with respect to <u>Section 13.4(a)</u> only if on or before twenty-four (24) months from the Closing Date, Seller notifies Buyer of a claim specifying the factual basis of the claim in reasonable detail to the extent then known by Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.7 <u>RESERVED</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **3.8 <u>Third-Party Claims</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Promptly after receipt by a Person entitled to indemnity under <u>Sections 13.2</u>, <u>13.3</u> (to the extent provided in the last sentence of <u>Section 13.3</u>) or <u>13.4</u> (an "<u>Indemnified Person</u>") of notice of the assertion of a Third-Party Claim against it, such Indemnified Person shall give notice to the Person obligated to indemnify under such Section (an "<u>Indemnifying Person</u>") of the assertion of such Third-Party Claim, provided that the failure to notify the Indemnifying Person will not relieve the Indemnifying Person of any liability that it may have to any Indemnified Person, except to the extent that the Indemnifying Person demonstrates that the defense of such Third-Party Claim is prejudiced by the Indemnified Person's failure to give such notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If an Indemnified Person gives notice to the Indemnifying Person pursuant to <u>Section 13.8(a)</u> of the assertion of a Third-Party Claim, the Indemnifying Person shall be entitled to participate in the defense of such Third-Party Claim and, to the extent that it wishes (unless (i) the Indemnifying Person is also a Person against whom the Third-Party Claim is made and the Indemnified Person determines in good faith that joint representation would be inappropriate or (ii) the Indemnifying Person fails to provide reasonable assurance to the Indemnified Person of its financial capacity to defend such Third-Party Claim and provide indemnification with respect to such Third-Party Claim), to assume the defense of such Third-Party Claim with counsel satisfactory to the Indemnified Person. After notice from the Indemnifying Person to the Indemnified Person of its election to assume the defense of such Third-Party Claim, the Indemnifying Person shall not, so long as it diligently conducts such defense, be liable to the Indemnified Person under this <u>Article 13</u> for any fees of other counsel or any other expenses with respect to the defense of such Third-Party Claim, in each case subsequently incurred by the Indemnified Person in connection with the defense of such Third-Party Claim, other than reasonable costs of investigation. If the Indemnifying Person assumes the defense of a Third-Party Claim, (1) such assumption will conclusively establish for purposes of this Agreement that the claims made in that Third-Party Claim are within the scope of and subject to indemnification, and (2) no compromise or settlement of such Third-Party Claims may be effected by the Indemnifying Person without the Indemnified Person's Consent unless (A) there is no finding or admission of any violation of Legal Requirement or any violation of the rights of any Person; (B) the sole relief provided is monetary damages that are paid in full by the Indemnifying Person; and (C) the Indemnified Person shall have no liability with respect to any compromise or settlement of such Third-Party Claims effected without its Consent. If notice is given to an Indemnifying Person of the assertion of any Third-Party Claim and the Indemnifying Person does not, within ten (10) Business Days after the Indemnified Person's notice is given, give notice to the Indemnified Person of its election to assume the defense of such Third-Party Claim, the Indemnifying Person will be bound by any determination made in such Third-Party Claim or any compromise or settlement effected by the Indemnified Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding the foregoing, the Indemnified Person may, by notice to the Indemnifying Person, assume the exclusive right to defend, compromise or settle such Third-Party Claim, but the Indemnifying Person will not be bound by any determination of any Third-Party Claim so defended for the purposes of this Agreement or any compromise or settlement effected without its Consent (which may not be unreasonably withheld).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Notwithstanding the provisions of <u>Section 15.4</u>, Seller hereby consents to the nonexclusive jurisdiction of any court in which a Proceeding in respect of a Third-Party Claim is brought against any Buyer Indemnified Person for purposes of any claim that a Buyer Indemnified Person may have under this Agreement with respect to such Proceeding or the matters alleged therein and agree that process may be served on Seller with respect to such a claim anywhere in the world.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) With respect to any Third-Party Claim subject to indemnification under this <u>Article 13</u>: (i) both the Indemnified Person and the Indemnifying Person, as the case may be, shall keep the other Person fully informed of the status of such Third-Party Claim and any related Proceedings at all stages thereof where such Person is not represented by its own counsel, and (ii) the parties agree (each at its own expense) to render to each other such assistance as they may reasonably require of each other and to cooperate in good faith with each other in order to ensure the proper and adequate defense of any Third-Party Claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) With respect to any Third-Party Claim subject to indemnification under this <u>Article 13</u>, the parties agree to cooperate in such a manner as to preserve in full (to the extent possible) the confidentiality of all Confidential Information and the attorney-client and work-product privileges. In connection therewith, each party agrees that: (i) it will use its Best Efforts, in respect of any Third-Party Claim in which it has assumed or participated in the defense, to avoid production of Confidential Information (consistent with applicable law and rules of procedure), and (ii) all communications between any party hereto and counsel responsible for or participating in the defense of any Third-Party Claim shall, to the extent possible, be made so as to preserve any applicable attorney-client or work-product privilege.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.9 <u>Other Claims</u>**

A claim for indemnification for any matter not involving a Third-Party Claim may be asserted by notice to the party from whom indemnification is sought and shall be paid promptly after such notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.10 <u>Non-Scheduled Assets</u>**

[RESERVED]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.11 <u>Exclusive Remedy</u>**

After the Closing, the indemnification provision set forth in this <u>Article 13</u> are and shall be the sole and exclusive remedy of each party with respect to this Agreement and the transactions contemplated herein, other than claims for fraud or willful misconduct for which a party suffering Damages arising therefrom may bring suit outside of this Agreement;<u>provided, however</u>, this sentence shall not be deemed a waiver by any party of its right to seek specific performance or injunctive relief in accordance with <u>Section 15.5</u> in the case of another party's failure to comply with the covenants made by such party to be performed after the Closing.

**14. <u>CONFIDENTIALITY</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.1 <u>Confidential Information</u>**

After the Closing Date, Seller shall maintain in confidence all proprietary and confidential business and other information that is related to the Brand, including Trade Secrets, product specifications, recipes, formulations, data, know-how, formulae, processes, designs, sketches, graphs, drawings, inventions and ideas, past, current and planned research and development, current and planned manufacturing or distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, supplier lists, historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans ("<u>Confidential Information</u>"), unless (a) such information is already known to the receiving party or to others not bound by a duty of confidentiality or such information becomes publicly available through no fault of Seller or a Parent Company, or (b) the furnishing or use of such information is required in connection with legal, administrative, regulatory or investigative proceedings (in which case Seller and Parent Company shall promptly notify Buyer so that Buyer may attempt to restrict or prohibit such disclosure).

**15. <u>GENERAL PROVISIONS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.1 <u>Expenses</u>**

Except, as otherwise provided in this Agreement, each party to this Agreement will bear its respective fees and expenses incurred in connection with the preparation, negotiation, execution and performance of this Agreement and the Contemplated Transactions, including all fees and expense of its Representatives. Buyer will pay one-half and Seller will pay one-half of the fees and expenses of the escrow agent under the Escrow Agreement. If this Agreement is terminated, the obligation of each party to pay its own fees and expenses will be subject to any rights of such party arising from a Breach of this Agreement by another party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.2 <u>Public Announcements</u>**

Any public announcement, press release or similar publicity with respect to this Agreement or the transactions contemplated hereunder will be issued, if at all, at such time and in such manner as Seller, Buyer and Bottling Acquiror jointly determine; <u>provided, however</u>, Buyer shall be free to issue such press releases or make any public filings as it deems necessary or advisable with respect to this Agreement or the transactions set forth herein under applicable securities laws or listing requirements without seeking the consent of Seller or Bottling Acquiror. Seller and Buyer will consult with each other concerning the means by which Seller's employees, customers, suppliers and others having dealings with Seller will be informed of the transactions contemplated hereunder, and Buyer will have the right to be present for any such communication.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.3 <u>Notices</u>**

All notices, Consents, waivers and other communications required or permitted by this Agreement shall be in writing and shall be deemed given to a party when (a) delivered to the appropriate address by hand or by nationally recognized overnight courier service (costs prepaid); (b) sent by facsimile with confirmation of transmission by the transmitting equipment; or (c) received or rejected by the addressee, if sent by certified mail, return receipt requested, in each case to the following addresses and facsimile numbers and marked to the attention of the person (by name or title) designated below (or to such other address, facsimile number, or person as a party may designate by notice to the other parties)

Each of the Parties agrees to email the other party no later than June 10, 2024 with a current address for use under this Notices provision.

---

| | |
|:---|:---|
| **Seller:**<br>| **with a copy to:** |
| **Buyer**: | **with a copy to:** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.4 <u>Jurisdiction; Service of Process; Waiver of Jury Trial</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any Proceeding arising out of or relating to this Agreement or any transaction contemplated hereunder shall be brought exclusively in the courts of the State of California, County of Orange, or, if it has or can acquire jurisdiction, in the United States District Court for the Southern District of Ohio, and each of the parties irrevocably submits to the exclusive jurisdiction of each such court in any such Proceeding, waives any objection it may now or hereafter have to venue or to convenience of forum, agrees that all claims in respect of the Proceeding shall be heard and determined only in any such court and agrees not to bring any Proceeding arising out of or relating to this Agreement or any transaction contemplated hereunder in any other court. The parties agree that either or both of them may file a copy of this paragraph with any court as written evidence of the knowing, voluntary and bargained agreement between the parties irrevocably to waive any objections to venue or to convenience of forum. Process in any Proceeding referred to in the first sentence of this section may be served on any party anywhere in the world.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b) THE PARTIES HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREUNDER, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.5 <u>Enforcement of Covenants</u>**

Seller acknowledges and agrees that Buyer would be irreparably damaged if any of the covenants of this Agreement are not performed in accordance with their specific terms and that any Breach of a covenant by Seller or Parent Company could not be adequately compensated in all cases by monetary damages alone. Accordingly, in addition to any other right or remedy to which Buyer may be entitled, at law or in equity, it shall be entitled to enforce any covenant of this Agreement by a decree of specific performance and to temporary, preliminary and permanent injunctive relief to prevent Breaches or threatened Breaches of any of the covenants of this Agreement, without posting any bond or other undertaking.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.6 <u>Waiver; Remedies Cumulative</u>**

The rights and remedies of the parties to this Agreement are cumulative and not alternative. Neither any failure nor any delay by any party in exercising any right, power or privilege under this Agreement or any of the documents referred to in this Agreement will operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege. To the maximum extent permitted by applicable law, (a) no claim or right arising out of this Agreement or any of the documents referred to in this Agreement can be discharged by one party, in whole or in part, by a waiver or renunciation of the claim or right unless in writing signed by the other party; (b) no waiver that may be given by a party will be applicable except in the specific instance for which it is given; and (c) no notice to or demand on one party will be deemed to be a waiver of any obligation of that party or of the right of the party giving such notice or demand to take further action without notice or demand as provided in this Agreement or the documents referred to in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.7 <u>Entire Agreement and Modification</u>**

This Agreement supersedes all prior agreements, whether written or oral, between the parties with respect to its subject matter (including any letter of intent, exclusivity agreement and any confidentiality agreement between Buyer and Seller) and constitutes (along with the Disclosure Schedule, Exhibits and other documents delivered pursuant to this Agreement) a complete and exclusive statement of the terms of the agreement between the parties with respect to its subject matter. This Agreement may not be amended, supplemented, or otherwise modified except by a written agreement executed by the party to be charged with the amendment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.8 <u>Assignments, Successors and No Third-Party Rights</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No party may assign any of its rights or delegate any of its obligations under this Agreement without the prior written consent of the other parties, except that Buyer may assign any of its rights and delegate any of its obligations under this Agreement to any subsidiary of Buyer or to any Person acquiring all or any part of the Assets or Brand from Buyer and may collaterally assign its rights hereunder to any financial institution providing financing in connection with the transactions contemplated hereunder. Subject to the preceding sentence, this Agreement will apply to, be binding in all respects upon and inure to the benefit of the successors and permitted assigns of the parties. Nothing expressed or referred to in this Agreement will be construed to give any Person other than the parties to this Agreement any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement, except such rights as shall inure to a successor or permitted assignee pursuant to this <u>Section 15.8</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Other than with respect to the Buyer Indemnified Persons, no provision of this Agreement, including without limitation <u>Section 12.1</u>, shall create any third-party beneficiary rights in any person, entity, or organization, including without limitation employees or former employees (including any beneficiary or dependent thereof) of Seller, unions or other representatives of such employees or former employees, or trustees, administrators, participants, or beneficiaries of any employee benefit plan, and no provision of this Agreement shall create such third-party beneficiary rights in any such person or organization in respect of any benefits that may be provided, directly or indirectly, under any employee benefit plan that is or may in the future be maintained by the Buyer. No provision of this Agreement, including without limitation <u>Section 12.1</u>, shall be deemed to amend any employee benefit plan that is or may in the future be maintained by the Buyer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.9 <u>Severability</u>**

If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.10 <u>Governing Law</u>**

This Agreement will be governed by and construed under the laws of the State of California without regard to conflicts-of-laws principles that would require the application of any other law.

This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. The exchange of copies of this Agreement and of signature pages by facsimile transmission or by other electronic means (including by pdf) shall constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement for all purposes. Signatures of the parties transmitted by facsimile or by other electronic means (including by pdf) shall be deemed to be their original signatures for all purposes.

[Signatures follows]

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

---

| | |
|:---|:---|
| **BUYER:** | **STELLAR SPIRITS AND WINES, INC.** |
| By: | <u>/s/ Luis Cota</u> |
| Name: | <u>Luis Cota</u> |
| Title: | <u>President & CEO</u> |
| **SELLER:** | **ELITE BEVERAGE INTERNATIONAL, INC.** |
| By: | <u>/s/ Steve Rice</u> |
| Name: | <u>Steve Rice</u> |
| Title: | <u>President & CEO</u> |

---

## Ex1A-12

**Exhibit 12.1**

**BERGER LAW FIRM LLC**

**333 Pearsall Ave, Suite 210**

**Cedarhurst, NY 11516**

**646-598-9098**

May 4, 2026

Stellar Spirits and Wines, Inc.

970 North Tustin Avenue, Suite 100

Anaheim, California 92807

Re: Offering Statement on Form 1-A

Ladies and Gentlemen:

We have been requested by Stellar Spirits and Wines, Inc., a California corporation (the "Company"), to furnish you with our opinion as to the matters hereinafter set forth in connection with the proposed public offering by the Company under the Securities Act of 1933, as amended, of up to 5,000,000 shares of its common stock, $0.0001 par value per share ("Common Stock") through a Regulation A Offering Statement on Form 1-A (the "Offering Statement") as to which this opinion is a part, to be filed with the Securities and Exchange Commission.

In connection with this opinion, we have examined the Offering Statement, the Company's Articles of Incorporation and Bylaws (each as amended to date), copies of the records of corporate proceedings of the Company and such other documents as we have deemed necessary to enable us to render the opinion hereinafter expressed.

For purposes of this opinion, we have assumed the authenticity of all documents submitted to us as originals, the conformity to the originals of all documents submitted to us as copies and the authenticity of the originals of all documents submitted to us as copies. We have also assumed the legal capacity of all natural persons, the genuineness of the signatures of persons signing all documents in connection with which this opinion is rendered, the authority of such persons signing on behalf of the parties thereto other than the Company and the due authorization, execution and delivery of all documents by the parties thereto other than the Company. We have not independently established or verified any facts relevant to the opinions expressed herein, but have relied upon statements and representations of officers and other representatives of the Company and others.

Based upon and subject to the foregoing qualifications, assumptions and limitations and the further limitations set forth below, we are of the opinion that the 5,000,000 shares of Common Stock being offered by the Company will, when issued in accordance with the terms set forth in the Offering Statement, be legally issued, fully paid and non-assessable shares of common stock of the Company.

We hereby consent to the use of this opinion as an exhibit to the Offering Statement and to the reference to our name under the caption "Legal Matters" in the Offering Statement and in the offering circular included in the Offering Statement. We confirm that, as of the date hereof, we own no shares of the Company's common stock, nor any other securities of the Company.

Sincerely,<br>*<u>/s/ Berger Law Firm LLC</u>* <br> BERGER LAW FIRM LLC<br>

### UNITED STATES SECURITIES AND EXCHANGE COMMISSION
**Washington, D.C. 20549**

## FORM 1-A

### REGULATION A OFFERING STATEMENT
### UNDER THE SECURITIES ACT OF 1933

### Item 1. Issuer Information

**Exact name of issuer:** Stellar Spirits & Wines, Inc.

**Jurisdiction of Incorporation/Organization:** CA

**Year of Incorporation:** 2021

**CIK:** 0002064965

**I.R.S. Employer Identification Number:** 87-2326106

**Primary Standard Industrial Classification Code:** 5180

**Total number of full-time employees:** 2

**Total number of part-time employees:** 0

**Address of Principal Executive Offices:** 92807, 714-242-5130, 970 NO. TUSTIN AVE., SUITE 100, CA ANAHEIM

**Company Phone:** 714-242-5130

**Person to contact:** Luis Cota

### Financial Statements

**Balance Sheet Information**

| Metric                                   | Amount      |
|:---|:---|
| Cash and Cash Equivalents                | $52696.00   |
| Investment Securities                    | $0.00       |
| Accounts and Notes Receivable            | $2515733.00 |
| Property, Plant and Equipment (PP&E)     | $0.00       |
| Total Assets                             | $4782161.00 |
| Accounts Payable and Accrued Liabilities | $579050.00  |
| Long-Term Debt                           | $3674541.00 |
| Total Liabilities                        | $4253591.00 |
| Total Stockholders' Equity               | $528570.00  |
| Total Liabilities and Equity             | $4782161.00 |

**Statement of Comprehensive Income Information**

| Metric                                    | Amount      |
|:---|:---|
| Total Revenues                            | $5309372.00 |
| Costs and Expenses Applicable to Revenues | $2454905.00 |
| Depreciation and Amortization             | $0.00       |
| Net Income                                | $812020.00  |
| Earnings Per Share - Basic                | 0.00        |
| Earnings Per Share - Diluted              | 0.00        |

**Auditor Information**

| Metric          | Amount   |
|:---|:---|
| Name of Auditor |  |

### Outstanding Securities

| Class                          |   Outstanding | CUSIP     | Publicly Traded   |
|:---|---:|:---|:---|
| Common Stock, $.0001 par value |     323000000 | 00000None | None              |

### Item 2. Issuer Eligibility
- [x] The issuer certifies that all of the statements in this part are true.

### Item 3. Application of Rule 262
- [x] The issuer certifies that it is not disqualified and has not been involved in any disqualifying event.

### Item 4. Summary Information Regarding the Offering

**Tier:** Tier1

**Financial Statement Status:** Unaudited

**Type of Securities Offered:** Equity (common or preferred stock)

**Is this a delayed or continuous offering?** Yes

**Was or is the offering to take place within one year after qualification?** Yes

**Was or is the offering to commence within two days after qualification?** No

**Is this a best efforts offering?** Yes

**Was there any solicitation of interest?** No

**Are there any resale securities by affiliates of the issuer?** No

**Offering Amounts**

| Description                                                     | Amount       |
|:---|:---|
| Number of securities offered                                    | 5000000      |
| Number of securities outstanding                                | 323000000    |
| Price per security                                              | $2.00        |
| Issuer's aggregate offering price                               | $10000000.00 |
| Aggregate offering price of securities held by security holders | $0.00        |
| Aggregate price of securities offered concurrently              | $0.00        |
| Total aggregate offering price                                  | $10000000.00 |

**Anticipated Fees**

| Service Provider   | Name    | Fees      |
|:---|:---|:---|
| Auditor            |  |  |
| Legal              | Various | $16000.00 |
| Promoters          |  |  |

**Estimated Net Proceeds to the Issuer:** $9981000.00

### Item 5. Jurisdictions in Which Securities are to be Offered

- All States and Territories