Document:

Unassociated Document

     

    REGISTRATION RIGHTS
AGREEMENT

     

    THIS REGISTRATION
RIGHTS AGREEMENT (the
“Agreement”)
is entered into as of July 1, 2010, between First Blush Brands,
Inc., a Delaware corporation (the “Company”),
and the Investors set forth on the signature pages hereto (each a “Holder”
and together, the “Holders”).

     

     

    WITNESSETH:

     

    WHEREAS, pursuant to the terms of
the Securities Purchase Agreement, dated as of July 1, 2010, among the Company
and the Holders (the “Purchase
Agreement”), the Company issued and the Holders purchased shares of
common stock of the Company (“Common
Stock”) and warrants to purchase Common Stock;

     

    WHEREAS, in connection with
the Holders’ entry into the Purchase Agreement the Company has agreed to grant
the Holders certain registration rights for the Common Stock issuable to the
Holders (the “Registration
Rights”);

     

    NOW, THEREFORE, for and in
consideration of the premises and the mutual covenants hereinafter set forth,
and for other good and valuable consideration, the parties hereby agree as
follows:

     

    ARTICLE
I.

    REGISTRABLE
SECURITIES

     

    Section
1.1           Registrable
Securities.  For purposes of this Agreement, “Registrable
Securities” means all Common Stock issued now or hereafter owned and held
by the Holders; provided that, if the
Company converts, by merger or otherwise, to another type of entity including
but not limited to a limited partnership, the term Registrable Securities as
defined herein shall refer to the securities in the new type of entity. Common
Stock, membership interests, partnership interests or other equity securities,
as the case may be, cease to be “Registrable Securities” when they are (i)
eligible for sale without volume limitations pursuant to Rule 144 pursuant to
the Securities Act of 1933, as amended (the “Securities
Act”), (ii) registered for resale under the Securities Act and sold
pursuant to such registration, or (iii) sold without having been registered
pursuant to an exemption from the registration requirements of the Securities
Act.

     

    ARTICLE
II.

    PIGGYBACK
REGISTRATIONS

     

    Section
2.1           Right to
Piggyback.  If the Company proposes to register any of its
securities under the Securities Act (other than pursuant to a registration
solely in connection with an employee benefit or stock ownership plan in a
transaction described in Rule 145 under the Securities Act) and the registration
form to be used may be used for the registration of the sale of Registrable
Securities (a “Piggyback
Registration”), the Company will give prompt written notice to all
Holders of Registrable Securities of its intention to effect such a registration
(each a “Piggyback
Notice”).  Subject to Section 2.2 and Section 2.3, the Company
will include in the Piggyback Registration all Registrable Securities that
Holders of Registrable Securities request the Company to include in the
Piggyback Registration by written notice given to the Company within fifteen
(15) days after the date of the Company’s notice.  The Holders
acknowledge that the Piggyback Notice may constitute material non-public
information regarding the Company.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    Section
2.2           Priority on Primary
Registrations.  If a Piggyback Registration relates to an
underwritten public offering of securities by the Company and the lead managing
underwriter(s) advise the Company in writing that in the opinion of the lead
managing underwriter(s) the number of securities requested to be included in the
Piggyback Registration exceeds the number that can be sold in an orderly manner
in such offering within a price range acceptable to the Company, the Company
will include in such registration (i) first, the securities proposed to be sold
by the Company, (ii) second, the Registrable Securities requested to be included
in the Piggyback Registration, pro rata among the Holders and all other holders
of Registration Rights from the Company based on the ratio of the number of
Registrable Securities that each such individual, corporation, limited liability
company, partnership, trust or any other organization or entity (collectively,
“Person”)
has requested the Company include in the Piggyback Registration over the total
number of Registrable Securities requested to be included in the Piggyback
Registration by the Holders; and (iii) third, other securities requested to
be included in such registration, pro rata among the holders of such other
securities based on the ratio of the number of such other securities that each
such holder has requested the Company include in the Piggyback Registration over
the total number of other securities requested to be included in the Piggyback
Registration by such other holders. In the event for any reason the Commission
(as hereinafter defined) notifies the Company of any limitation on the number of
Registrable Securities that may be included in a Registration Statement, such
notice shall be treated as if an underwriter had given such notice and the
Registrable Securities included in such Piggyback Registration will be adjusted
in accordance with this Section 2.2.

     

    Section
2.3           Priority on Secondary
Registrations.  If a Piggyback Registration relates to an
underwritten public offering of securities by holders of the Company’s
securities ( the “Selling
Stockholders”) and the managing
underwriter(s) advise the Company in writing that in their opinion, the number
of securities requested to be included in the Piggyback Registration exceeds the
number that can be sold in an orderly manner in such offering within a price
range acceptable to the Selling Stockholders, the Company will include in the
Piggyback Registration (i) first, the securities of the Selling Stockholders;
(ii) second, the Registrable Securities requested to be included in such
registration, pro rata among the Holders and all other holders of registration
rights from the Company based on the ratio of the number of Registrable
Securities that each such Person has requested the Company include in the
Piggyback Registration over the total number of Registrable Securities requested
to be included in the Piggyback Registration; and (iii) third, other
securities requested to be included in such registration, pro rata among the
holders of such securities based on the ratio of the number of such other
securities that each such holder has requested the Company include in the
Piggyback Registration over the total number of other securities requested to be
included in the Piggyback Registration by such other holders.

     

    Section
2.4           Rule 415.
Notwithstanding anything to the contrary herein, the Company shall be entitled
to limit the number of Regsitrable Securities to the extent it deems advisable,
upon advice of its legal counsel, in order to comply with Rule 415 under the
Securities Act.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    ARTICLE
III.

    REGISTRATION
PROCEDURES

     

    Section
3.1           Registration
Procedures.  Whenever the Holders of Registrable Securities
have requested that the sale of any Registrable Securities be registered
pursuant to this Agreement, the Company will use its commercially reasonable
efforts consistent with this Agreement, legal requirements and, in the case of
an offering by the Company, prevailing market conditions, to effect the
registration and the sale of such Registrable Securities in accordance with the
intended method of distribution thereof and will promptly:

     

    (a)           prepare
and file with the Securities and Exchange Commission (the “Commission”)
a registration statement with respect to such Registrable Securities and use its
commercially reasonable efforts to cause such registration statement to become
effective, provided that, before filing a registration statement or prospectus
or any amendments or supplements thereto, the Company will furnish to one
counsel selected by the Holders of a majority of the Registrable Securities
covered by such registration statement copies of all such documents proposed to
be filed, which documents will be subject to the review of such
counsel;

     

    (b)           prepare
and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective for the earlier of: (i)
such time as all such Registrable Securities covered by the registration
statement have been sold or (ii) a period of one hundred-eighty (180) days,
after the effective date of the registration statement covering such Registrable
Securities, and comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such registration statement during
such period in accordance with the intended methods of distribution by the
Holders set forth in such registration statement;

     

    (c)           furnish
to each Holder such number of copies of such registration statement, each
amendment and supplement thereto, the prospectus included in such registration
statement (including each preliminary prospectus) and such other documents as
such Holder may reasonably request in order to facilitate the disposition of the
Registrable Securities owned by such Holder;

     

    (d)           use
its commercially reasonable efforts to register or qualify such Registrable
Securities under such other securities or blue sky laws of such jurisdictions of
the United States as any Holder reasonably requests and do any and all other
acts and things which may be reasonably necessary or advisable to enable such
Holder to consummate the disposition in such jurisdictions of the Registrable
Securities owned by such Holder, provided that the Company will not be required
(i) to qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this paragraph, (ii) to subject itself
to taxation in any such jurisdiction or (iii) to consent to general service of
process in any such jurisdiction;

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

       

    

    (e)           notify
each Holder of such Registrable Securities, at any time when a prospectus
relating thereto is required to be delivered under the Securities Act, of the
happening of any event as a result of which the prospectus included in such
registration statement contains an untrue statement of a material fact or omits
any fact necessary to make the statements therein not misleading, and, at the
request of any such Holder, the Company will prepare a supplement or amendment
to such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an untrue statement of
a material fact or omit to state any fact necessary to make the statements
therein not misleading in light of the circumstances then existing;

     

    (f)           cause
all such Registrable Securities to be listed on each securities exchange on
which similar securities issued by the Company are then listed and to be
qualified for trading on each system on which similar securities issued by the
Company are from time to time qualified;

     

    (g)           provide
a transfer agent and registrar for all such Registrable Securities not later
than the effective date of such registration statement and thereafter maintain
such a transfer agent and registrar;

     

    (h)           in
connection with any underwritten offering, enter into such customary agreements
not inconsistent with this Agreement (including underwriting agreements and
lock-up agreements in customary form) and take all such other actions as the
Holders of a majority of the Registrable Securities being sold or the
underwriters, if any, reasonably request in order to facilitate the disposition
of such Registrable Securities;

     

    (i)           make
available for inspection by any underwriter participating in any disposition
pursuant to such registration statement and any attorney, accountant or other
agent retained by any such underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company’s officers, directors, employees and independent accountants to supply
all information reasonably requested by any such underwriter, attorney,
accountant or agent in connection with such registration statement;

     

    (j)           otherwise
use its commercially reasonable efforts to comply with all applicable rules and
regulations of the Commission, and make available to its security holders, as
soon as reasonably practicable, an earnings statement covering the period of at
least twelve (12) months beginning with the first day of the Company’s first
full calendar quarter after the effective date of the registration statement,
which earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder;

     

    (k)           permit
any Holder that might be deemed, in the reasonable judgment of such Holder, to
be an underwriter or a controlling Person of the Company, to participate in the
preparation of such registration or comparable statement and to require the
insertion therein of material, furnished to the Company in writing, which in the
reasonable judgment of such Holder and its counsel should be included;
and

     

    (l)           in
the event of the issuance of any stop order suspending the effectiveness of a
registration statement, or of any order suspending or preventing the use of any
related prospectus or suspending the qualification of any Registrable Securities
included in such registration statement for sale in any jurisdiction, the
Company will use its commercially reasonable efforts promptly to obtain the
withdrawal of such order.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    If any
such registration or comparable statement refers to any Holder by name or
otherwise as the holder of any securities of the Company and if, in its
reasonable judgment, such Holder is or might be deemed to be a controlling
Person of the Company, such Holder shall have the right to require (a) the
inclusion in such registration statement of language, in form and substance
reasonably satisfactory to such Holder, to the effect that the holding of such
securities by such Holder is not to be construed as a recommendation by such
Holder of the investment quality of the Company’s securities covered thereby and
that such holding does not imply that such Holder will assist in meeting any
future financial requirements of the Company, or (b) in the event that such
reference to such Holder by name or otherwise is not required by the Securities
Act or any similar federal statute then in force, the deletion of the reference
to such Holder; provided, that with
respect to this clause (b) such Holder shall furnish to the Company an opinion
of counsel to such effect, which opinion and counsel shall be reasonably
satisfactory to the Company.

     

    ARTICLE
IV.

    REGISTRATION
EXPENSES

     

    Section
4.1           Definition.  The
term “Registration
Expenses” means all reasonable expenses incident to the Company’s
performance of or compliance with Article III of this Agreement, including
without limitation all registration and filing fees, fees and expenses of
compliance with securities or blue sky laws of jurisdictions in the United
States, printing expenses, messenger and delivery expenses, fees and expenses of
attorneys, accountants and other experts, and fees and expenses of underwriters
and their attorneys and experts, other than underwriters’ discounts and
commissions, which shall be deducted from the proceeds of the offering payable
to the selling Holders of Registrable Securities.

     

    Section
4.2           Payment.  The
Company shall pay the Registration Expenses in connection with any and all
Piggyback Registrations.  In connection with each Piggyback
Registration, the Company will reimburse the Holders of Registrable Securities
covered by such registration for the reasonable fees and disbursements of one
nationally recognized counsel chosen by the Holders of a majority of the
Registrable Securities up to a maximum of ten thousand dollars ($10,000).

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    ARTICLE
V.

    INDEMNIFICATION

     

    Section
5.1           Indemnification by the
Company.  The Company agrees to indemnify, to the extent
permitted by law, (i) each Holder, (ii) the officers, directors, partners,
members, managers, stockholders, accountants, attorneys, agents and employees,
of each of them, and each Person who controls such Holder (within the meaning of
the Securities Act) and (iii) such controlling Person’s officers, directors,
partners, members, managers, stockholders, accountants, attorneys, agents and
employees, in each case against all losses, claims, damages, liabilities and
expenses, costs (including, without limitation, costs of preparation and
reasonable attorneys’ fees and any legal or other fees or expenses incurred by
such party in connection with any investigation or proceeding), judgments,
fines, penalties, charges and amounts paid in settlement (collectively, “Losses”),
as incurred, caused by (i) any untrue or alleged untrue statement of material
fact contained in any registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto, (ii) any omission or
alleged omission of a material fact required to be stated therein or necessary
to make statements therein not misleading or, with respect to any prospectus
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, or (iii) any violation by the Company of
the Securities Act or any rule or regulation thereunder applicable to the
Company and relating to action or inaction required of the Company under this
Agreement in connection with any such registration, qualification, or
compliance, and will reimburse each such Holder, each of its officers,
directors, partners, members, managers, stockholders, accountants, attorneys,
agents and employees and each Person controlling such Holder, and the officers,
directors, partners, members, managers, stockholders, accountants, attorneys,
agents and employees of such controlling Person, for any legal and any other
expenses reasonably incurred in connection with investigating and defending or
settling any such Loss or action, except insofar as the same are caused by or
contained in any information furnished in writing to the Company by such Holder
expressly for use therein; provided, however, that the Company shall not be
required to indemnify any Person for any Losses caused by any untrue or alleged
untrue statement of material fact contained in any registration statement,
prospectus or preliminary prospectus or any amendment thereof or supplement
thereto or any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein not misleading to the
extent, but only to the extent, that (x) such untrue statements or omissions are
based solely upon information regarding such Holder furnished in writing to the
Company by such Holder expressly for use therein, or to the extent that such
information relates to such Holder or such Holder’s proposed method of
distribution of Registrable Securities and was reviewed and expressly approved
in writing by such Holder expressly for use in such registration statement, such
prospectus or such form of prospectus or in any amendment or supplement thereto
or (y) such Person uses an outdated or defective prospectus after the Company
has notified such Person in writing that the prospectus is outdated or
defective.  In connection with an underwritten offering, the Company
will indemnify such underwriters, their officers and directors and each Person
who controls such underwriters (within the meaning of the Securities Act) to the
same extent as provided above with respect to the indemnification of the holders
of Registrable Securities.

     

    Section
5.2           Indemnification by
Holders.  In connection with any registration statement in
which a Holder is participating, each such Holder will furnish to the Company in
writing such information and affidavits as the Company reasonably requests for
use in connection with any such registration statement and related prospectus
and, to the extent permitted by law, will indemnify and hold harmless, severally
and not jointly, (i) the Company, (ii) the Company’s directors, officers,
partners, members, managers, stockholders, accountants, attorneys, agents and
employees, (iii) each Person who controls the Company (within the meaning of the
Securities Act), (iv) each such controlling Person’s officers, directors,
partners, members, managers, stockholders, accountants, attorneys, agents and
employees, (v) each other Holder and (vi) such Holder’s officers, directors,
partners, members, managers, stockholders, accountants, attorneys, agents and
employees, in each case against any Losses, as incurred,  resulting
from (i) any untrue or alleged untrue statement of material fact contained in
the registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto, (ii) any omission or alleged omission
of a material fact required to be stated therein or necessary to make the
statements therein not misleading or, with respect to any prospectus, necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading, or (iii) any violation by such Holder of the
Securities Act or any rule or regulation thereunder applicable to such Holder
and relating to action or inaction required of such Holder in connection with
any such registration, qualification, or compliance, and will reimburse such
indemnified Persons for any legal or any other expenses reasonably incurred in
connection with investigating or defending any such Loss or action, in each case
to the extent, but only to the extent, that (x) such untrue statements or
omissions is contained or should have been contained in any information or
affidavit so furnished in writing by such Holder expressly for use in such
registration statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto, or to the extent that such information relates to
such Holder or such Holder’s proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in such registration statement, such prospectus or such form
of prospectus or in any amendment or supplement thereto or (y) such Holder uses
an outdated or defective prospectus after the Company has notified such Holder
in writing that the prospectus is outdated or defective; provided, that the
obligation to indemnify will be individual to each Holder and will be limited to
the amount of net proceeds received by such Holder from the sale of Registrable
Securities pursuant to such registration statement.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

    

    Section
5.3           Notice; Defense of
Claims.  Any Person entitled to indemnification hereunder will
(i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification and (ii) unless in such indemnified
party’s reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party.  If such defense is assumed,
the indemnifying party will not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent will not be
unreasonably withheld).  An indemnifying party who is not entitled to, or
elects not to, assume the defense of a claim will not be obligated to pay the
fees and expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim.

     

    Section
5.4           Survival.  The
indemnification provided for under this Agreement will remain in full force and
effect regardless of any investigation made by or on behalf of the indemnified
party or any officer, director, employee, agent or controlling Person of such
indemnified party and will survive the transfer of securities.

     

    Section
5.5           Contribution.  If
the indemnification provided for in this Article V is unavailable to an
indemnified party in respect of any Losses (other than in accordance with its
terms), then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the indemnifying party, on the one
hand, and such indemnified party, on the other hand, in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations.  The relative fault of such
indemnifying party, on the one hand, and indemnified party, on the other hand,
shall be determined by reference to, among other things, whether any action in
question, including any untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact, has been taken by, or
relates to information supplied by, such indemnifying party or indemnified
party, and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent any such action, statement or
omission.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

    The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 5.5 were determined by pro rata allocation or by any
other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding
paragraph.  Notwithstanding the provisions of this Section 5.5, an
indemnifying party that is a selling Holder of Registrable Securities shall not
be required to contribute any amount in excess of the amount by which the net
proceeds from the sale of the Registrable Securities sold by such indemnifying
party exceeds the amount of any damages that such indemnifying party has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.  No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation.  The obligation of each
selling Holder of Registrable Securities to contribute pursuant to this
Section 5.5 is several, and not joint, in proportion to the net proceeds of
the offering received by such selling Holder in relation to the total net
proceeds of the offering received by all of the selling Holders.

     

    Section
5.6           Underwriting
Agreement.  To the extent that the provisions on
indemnification and contribution contained in the underwriting agreement entered
into by the Company in connection with an underwritten public offering are in
conflict with the provisions of this Article V that relate to indemnification
and contribution of underwriters, the provisions contained in the underwriting
agreement shall control.

     

    ARTICLE
VI.

    PARTICIPATION
IN UNDERWRITTEN REGISTRATIONS

     

    Section
6.1           Acceptance of
Underwriting.  No Person may participate in any registration
hereunder that is underwritten unless such Holder (i) agrees to sell such
Holder’s securities on the basis provided in any underwriting arrangements
approved by the Holders entitled hereunder to approve such arrangements and (ii)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such
underwriting arrangements; provided, that no Holder included in any underwritten
registration shall be required to make any representations or warranties to the
Company or the underwriters other than representations and warranties regarding
such Holder as are reasonably required by the underwriters.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

    

    ARTICLE
VII.

    REPORTING
REQUIREMENTS UNDER EXCHANGE ACT

     

    Section
7.1           Reporting.  The
Company shall keep effective the registration of its securities under Section 12
of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) and shall timely file such information, documents and reports for
so long as the Commission may require or prescribe under Section 13 of the
Exchange Act.  The Company shall (whether or not it shall then be
required to do so) timely file such information, documents and reports which it
is required to file pursuant to Section 13 or 15(d) of the Exchange
Act.  The Company shall forthwith upon request furnish any Holder (i)
a written statement by the Company that it has complied with such reporting
requirements, (ii) to the extent available, a copy of the most recent
annual or quarterly report of the Company, and (iii) such other reports and
documents filed by the Company with the Commission as such Holder may reasonably
request in availing itself of an exemption for the sale of Registrable
Securities without registration under the Securities Act.  The Company
acknowledges and agrees that the purposes of the requirements contained in this
Article VII are (a) to enable any such Holder to comply with the current public
information requirement contained in paragraph (c) of Rule 144 under the
Securities Act should such Holder ever wish to dispose of any of the securities
of the Company acquired by it without registration in reliance upon Rule 144
under the Securities Act (or any other similar exemptive provision) and (b) to
qualify the Company for the use of registration statements on Form
S-3.  In addition, so long as the Company is subject to Section 13 or
15(d) of the Exchange Act, the Company shall take such other measures and file
such other information, documents and reports, as shall hereafter be required by
the Commission as a condition to the availability of Rule 144 under the
Securities Act (or any similar exemptive provision hereafter in effect) and the
use of Form S-3.

     

    ARTICLE
VIII.

    MISCELLANEOUS

     

    Section
8.1           Confidentiality.

     

    (a)           All
information furnished by the Company or its Representatives (as defined below),
whether furnished before or after the date hereof, and regardless of the manner
in which it is furnished, is referred to in this Agreement as "Proprietary
Information".  Proprietary Information does not include,
however, information which (a) is or becomes generally available to the public
other than as a result of a disclosure by a Holder or its Representatives, (b)
was available to a Holder on a nonconfidential basis prior to its disclosure to
a Holder by the Company or its Representatives, or (c) becomes available to
a Holder on a nonconfidential basis from a person, other than the Company or any
of its Representatives, who is not bound by a confidentiality agreement with or
other contractual, legal or fiduciary obligation to the Company.  As
used in this Agreement, the term "Representative"
means, as to any person, such person's affiliates and its and their directors,
officers, employees, agents, advisors (including, without limitation, financial
advisors, counsel and accountants) and controlling persons.  As used
in this letter agreement, the term "person" shall be broadly interpreted to
include, without limitation, any corporation, company, partnership, other entity
or individual.

     

    (b)           Each
Holder shall keep strictly confidential all Proprietary Information and will
not, without express written authorization signed by an authorized officer of
the Company, use, sell, market or disclose any Confidential Information to any
person for any purpose.  Each Holder shall be responsible for any
breach of this Agreement by any of its Representatives and shall, at its sole
expense, take all reasonable measures (including but not limited to court
proceedings) to restrain its Representatives from prohibited or unauthorized
disclosure of use of the Proprietary Information. Each Holder shall immediately
notify the Company of any unauthorized disclosure and, without affecting the
Company’s rights as a result thereof, take all steps necessary to prevent
further disclosure.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

    (c)           In
the event that a Holder is required by, law, regulation, legal process or
regulatory authority to disclose any Proprietary Information or any other
information concerning the Company, such Holder shall provide the Company with
prompt written notice of such request or requirement (to the extent not
prohibited by law or legal process) in order to enable the Company to seek an
appropriate protective order or other remedy, to not object to the Company's
taking steps (at its sole expense) to resist or narrow the scope of such request
or legal process, or to waive compliance, in whole or in part, with the terms of
this Agreement.  If, in the absence of a protective order or other
remedy or waiver of the terms of this letter agreement, a Holder determines upon
the opinion of its legal counsel that such Holder or any Representative is
required by, law, regulation, legal process or regulatory authority to disclose
any Proprietary Information or other information concerning the Company, such
Holder or such Representative may disclose only such Proprietary Information or
other information as must be disclosed by law, regulation, legal process or
regulatory authority and shall exercise reasonable efforts to obtain assurances
that such Proprietary Information or other information will be accorded
confidential treatment.

     

    Section
8.2           No Inconsistent
Agreements.  The Company will not hereafter enter into any
agreement with respect to its securities that is inconsistent with or violates
the rights granted to the Holders in this Agreement.

     

    Section
8.3           Adjustments Affecting
Securities.  The Company will not take any action, or permit
any change to occur, with respect to its securities for the purpose of (i)
materially and adversely affecting the ability of the Holders to include such
Registrable Securities in a registration undertaken pursuant to this Agreement
or (ii) materially and adversely affecting the marketability of such Registrable
Securities in any such registration (including, without limitation, effecting a
stock split or a combination of stock); provided that this Section 8.3 shall not
apply to actions or changes with respect to the Company’s business, earnings or
revenues in which the effect of such actions or changes on the Registrable
Securities is merely incidental.

     

    Section
8.4           Notices.  All
notices, demands or other communications to be given or delivered under or by
reason of the provisions of this Agreement will be in writing and will be deemed
to have been given when delivered personally or by overnight delivery service
with signature proof of delivery, or seventy-two (72) hours after having been
mailed by certified or registered mail, return receipt requested and postage
prepaid, to the recipient.  Such notices, demands and other
communications shall be sent to the Company, to the address of the Company’s
principal office, Attn.: President, or to the Holders, to their most recent
addresses as set forth in the books and records of the Company, or to such other
address or to the attention of such other Person as the recipient party has
specified by prior written notice to the sending party.  Delivery by
telecopy or electronic mail shall not be deemed to be adequate notice
hereunder.

     

    Section
8.5           Remedies.  Any
Person having rights under any provision of this Agreement will be entitled to
enforce such rights specifically and to recover damages caused by reason of any
breach of any provision of this Agreement and to exercise all other rights
granted by law.  The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party may in its sole discretion apply to any court of
law or equity of competent jurisdiction (without posting any bond or other
security) for specific performance and for other injunctive relief in order to
enforce or prevent violation of the provisions of this Agreement.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

       

    

    Section
8.6           Amendments and
Waivers.  Except as otherwise provided herein, no amendment,
waiver, modification, termination or cancellation of this Agreement shall be
effective unless made in writing signed by the Company and the Holders of at
least 66-2/3% of the then outstanding Registrable Securities.

     

    Section
8.7           Successors and
Assigns.  The Holder may assign all or any portion of its
rights under this Agreement to any affiliate, partner, member or shareholder of
such Holder or to any Person to whom such Holder transfers at least five percent
(5%) of the Registrable Securities held by such Holder.  Subject to
the foregoing, the rights of the parties under this Agreement shall inure to the
benefit of, and this Agreement shall be binding upon, the successors and assigns
of the parties hereto.

     

    Section
8.8           Severability.  If
any provision of this Agreement shall be held to be illegal, invalid or
unenforceable under any applicable law, then such contravention or invalidity
shall not invalidate the entire Agreement.  Such provision shall be
deemed to be modified to the extent necessary to render it legal, valid and
enforceable, and if no such modification shall render it legal, valid and
enforceable, then this Agreement shall be construed as if not containing the
provision held to be invalid, and the rights and obligations of the parties
shall be construed and enforced accordingly.

     

    Section
8.9           Entire
Agreement.  This Agreement, those documents expressly referred
to herein, and the other documents of even date herewith embody the complete
agreement and understanding among the parties and supersede and preempt any
prior understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any
way.

     

    Section
8.10         Headings.  The
headings of this Agreement are for convenience only and do not constitute a part
of this Agreement.

     

    Section
8.11         Governing
Law.  The construction, validity and interpretation of this
Agreement will be governed by and construed in accordance with the domestic laws
of the State of Delaware, without giving effect to any choice of law or conflict
of law provision or rule (whether of the State of Delaware or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the State of Delaware.

     

    Section
8.12         Further
Assurances.  Each party to this Agreement hereby covenants and
agrees, without the necessity of any further consideration, to execute and
deliver any and all such further documents and take any and all such other
actions as may be necessary or appropriate to carry out the intent and purposes
of this Agreement and to consummate the transactions contemplated
hereby.

     

    Section
8.13         Counterparts.  This
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, with the same effect as if all parties had
signed the same document.  All such counterparts shall be deemed an
original, shall be construed together and shall constitute one and the same
instrument.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

    Section
8.14         Termination.  Subject
to Section 1.1 hereof, this Agreement shall terminate as to any Holder, when all
Registrable Securities held by such Holder no longer constitute Registrable
Securities.

     

    

     

    

     

    [Remainder of Page Intentionally Left
Blank. Signature Pages Follow.]

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

       

    

    IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first written above.

     

    
      
        	 	

                COMPANY:

              	 
	 	 	 
	 	

                FIRST
      BLUSH BRANDS, INC.

              	 
	 	 	 	 
	
                 

              	
                By:
      

              	 	 
	 	 	Name: 	 
	 	 	Title: 	 
	 	 	 	 

      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

      
        
          	 	

                  HOLDERS:

                	 
	 	 	 
	 	 	 
	 	

                  Name:

                	 
	 	 	 
	 	-OR-	 
	 	 	 
	 	_________________________	 
	 	 	 	 
	
                   

                	
                  By:
      

                	 	 
	 	 	Name: 	 
	 	 	Title:Unassociated Document

    SECURITIES PURCHASE
AGREEMENT

     

    THIS
SECURITIES PURCHASE AGREEMENT (“Agreement”) is made
as of the 1st day of
July, 2010, by and among FIRST BLUSH BRANDS, INC., a Delaware corporation, with
an address at 9595 Wilshire Blvd., Suite #900, Beverly Hills,
California  90212 (the “Company”), and the
Investors set forth on the signature pages affixed hereto (each an “Investor” and
collectively the “Investors”).

     

    Recitals:

     

    A.           The
Company and the Investors are executing and delivering this Agreement in
connection with an offering of securities of the Company (the “Offering ”) in
reliance upon the exemption from securities registration afforded by the
provisions of Regulation D (“Regulation D”), as
promulgated by the United States Securities and Exchange Commission (the “SEC ”) under the
Securities Act of 1933, as amended (the “1933 Act”);
and

     

    B.           The
Investors wish to purchase from the Company, and the Company wishes to sell and
issue to the Investors, securities having a maximum aggregate purchase price of
$1,000,000 (the “Maximum Amount”) upon
the terms and conditions stated in this Agreement; and

     

    C.           The
securities sold in the Offering shall consist of units (the “Units”) of (i) two
(2) shares of the Company’s Common Stock (the “Shares”), (ii) a warrant to
purchase one (1) share of Common Stock, in substantially the form attached
hereto as Exhibit
A (the “Base Warrant”) and (iii) a
warrant to purchase additional shares of Common Stock, in substantially the form
attached hereto as Exhibit B (the “Par Value Warrant”
and together with the Base Warrant, the “Warrants”)

     

    D.           The
purchase price per Unit shall be $2.00 (the “Purchase Price”) with
a minimum purchase by each Investor of $1,000, or 500 Units; and

     

    E.           Contemporaneous
with each sale of Units, the Company and Investor will execute and deliver a
Registration Rights Agreement, in substantially the form attached hereto as
Exhibit C (the
“Registration Rights
Agreement”), pursuant to which the Company will agree to provide certain
piggyback registration rights under the 1933 Act, and the rules and regulations
promulgated thereunder, and applicable state securities laws; and

     

    F.           Each
Investor is an “Accredited Investor” as that term is defined in Regulation
D.

     

    In
consideration of the mutual promises made herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

     

    1.           Definitions.  For
the purposes of this Agreement, the following terms shall have the meanings set
forth below:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “$” means United
States dollars.

     

    “1933 Act” has the
meaning set forth in the Recitals.

     

    “1933 Act” has the
meaning set forth in the Recitals.

     

    “1934 Act” means the
Securities Exchange Act of 1934, as amended, or any successor statute, and the
rules and regulations promulgated thereunder.

     

    “Affiliate” means,
with respect to any Person, any other Person which directly or indirectly
through one or more intermediaries Controls, is controlled by, or is under
common control with, such Person.

     

    “Agreement” has the
meaning set forth in the Preamble.

     

    “Base Warrant” has the
meaning set forth in the Recitals.

     

    “Business Day” means a
day, other than a Saturday or Sunday, on which banks in New York City are open
for the general transaction of business.

     

    “Closing” has the
meaning set forth in Section 2.1.

     

    “Closing Date” has the
meaning set forth in Section  3(c).

     

    “Common Stock” means
the Company’s common stock, par value $0.001 per share, and any securities into
which the common stock may be reclassified.

     

    “Common Stock
Equivalents” means any securities of the Company or any Subsidiary which
entitle the holder thereof to acquire Common Stock at any time, including
without limitation, any debt, preferred stock, rights, options, warrants or
other instrument that is at any time convertible into or exchangeable for, or
otherwise entitles the holder thereof to receive, Common Stock or other
securities that entitle the holder to receive, directly or indirectly, Common
Stock.

     

    “Company” has the
meaning set forth in the Preamble.

     

    “Company’s Knowledge,”
or words of similar effect, means the actual knowledge of the executive officers
(as defined in Rule 405 under the 1933 Act) of the Company, after due
inquiry.

     

    “Confidential
Information” means trade secrets, confidential information and know-how
(including but not limited to ideas, formulae, compositions, processes,
procedures and techniques, research and development information, computer
program code, performance specifications, support documentation, drawings,
specifications, designs, business and marketing plans, and customer and supplier
lists and related information).

     

    “Control” (including
the terms “controlling”, “controlled by” or “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.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    “Equity Securities”
means any stock or similar securities, including, without limitation, securities
containing equity features and securities containing profit participation
features, or any securities convertible into or exchangeable for, with or
without consideration, any stock or similar securities, or any securities
carrying any warrant, right or option to subscribe to or purchase any shares of
capital stock, or any such warrant or right.

     

    “Governmental Body”
means any federal, national, state, or provincial, municipal or local
government, governmental authority, regulatory or administrative agency,
governmental commission, department, board, bureau, agency or instrumentality,
political subdivision, commission, court, tribunal, official, arbitrator or
arbitral body, in each case whether U.S. or non-U.S.

     

    “Initial Closing” has
the meaning set forth in Section 3(b).

     

    “Insiders” means the
Company’s directors and executive officers.

     

    “Intellectual
Property” means all of the following: (i) patents, patent applications,
patent disclosures and inventions (whether or not patentable and whether or not
reduced to practice); (ii) trademarks, service marks, trade dress, trade names,
corporate names, logos, slogans and Internet domain names, together with all
goodwill associated with each of the foregoing; (iii) copyrights and
copyrightable works; (iv) registrations, applications and renewals for any of
the foregoing; and (v) proprietary computer software (including but not limited
to data, data bases and documentation).

     

    “Legal Requirements”
means, with respect to any Person, any U.S. or non-U.S. federal, national,
state, provincial, local, municipal, international, multinational or other law
(including common law), constitution, statute, code, ordinance, rule, regulation
or treaty applicable to such Person.

     

    “Material Adverse
Effect” means a material adverse effect on (i) the assets, liabilities,
results of operations, condition (financial or otherwise), business of the
Company and its Subsidiaries taken as a whole, or (ii) the ability of the
Company to perform its obligations under the Transaction Documents.

     

    “Maximum Amount” has
the meaning set forth in the Recitals.

     

     “Offering” has the
meaning set forth in the Recitals.

     

    “Par Value Warrant”
has the meaning set forth in the Recitals.

     

    “Person” means an
individual, corporation, partnership, limited liability company, trust, business
trust, association, joint stock company, joint venture, sole proprietorship,
unincorporated organization, governmental authority or any other form of entity
not specifically listed herein.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

       

    

    “Purchase Price” has
the meaning set forth in the Recitals.

     

    “Qualified Financing”
means the next financing of the Company through the issuance of Equity
Securities resulting in gross proceeds to the Company of not less than
$1,000,000..

     

    “Registration
Statement” has the meaning set forth in the Registration Rights
Agreement.

     

    “Regulation D” has the
meaning set forth in the Recitals.

     

    “Shares” has the
meaning set forth in the Recitals.

     

    “SEC” has the meaning
set forth in the Recitals.

     

    “SEC Filings” has the
meaning set forth in Section 4.6.

     

    “Securities” means the
Shares, the Warrants and the Warrant Shares.

     

    “Short Sales” include,
without limitation, all “short sales” as defined in Rule 200 promulgated under
Regulation SHO under the 1934 Act and all types of direct and indirect stock
pledges, forward sale contracts, options, puts, calls, swaps and similar
arrangements (including on a total return basis), and sales and other
transactions through non-US broker dealers or foreign regulated
brokers.

     

    “Subscription
Instructions” has the meaning set forth in Section 3(b).

     

    “Subsidiary” of any
Person means another Person, an amount of the voting securities, other voting
ownership or voting partnership interests of which is sufficient to elect at
least a majority of its Board of Directors or other governing body (or, if there
are no such voting interests, 50% or more of the equity interests of which) is
owned directly or indirectly by such first Person.

     

    “Trading Day” means
(i) a day on which the Common Stock is traded on a Trading Market (other than
the OTC Bulletin Board), or (ii) if the Common Stock is not listed on a Trading
Market (other than the OTC Bulletin Board), a day on which the Common Stock is
traded in the over-the-counter market, as reported by the OTC Bulletin Board, or
(iii) if the Common Stock is not quoted on any Trading Market, a day on which
the Common Stock is quoted in the over-the-counter market as reported by the
Pink Sheets LLC (or any similar organization or agency succeeding to its
functions of reporting prices); provided, that in the event that the Common
Stock is not listed or quoted as set forth in (i), (ii) and (iii) hereof, then
Trading Day shall mean a Business Day.

     

    “Trading Market” means
whichever of the New York Stock Exchange, the NYSE AMEX, the NASDAQ Global
Select Market, the NASDAQ Global Market, the NASDAQ Capital Market or OTC
Bulletin Board on which the Common Stock is listed or quoted for trading on the
date in question.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    “Transaction
Documents” means this Agreement, the Warrants and the Registration Rights
Agreement.

     

    “Transfer Agent” means
Corporate Stock Transfer, the Company’s transfer agent.

     

    “Unit” has the meaning
set forth in the Recitals.

     

    “Warrants” has the
meaning set forth in the Recitals.

     

    “Warrant Shares” means
the shares of Common Stock issuable upon the exercise of the
Warrants.

     

    2.           Purchase and Sale of the
Securities.

     

    2.1           Subject
to the terms and conditions of this Agreement, the Investors shall severally,
and not jointly, purchase, and the Company shall sell and issue to such
Investors, Units having an aggregate Purchase Price of not more than the Maximum
Amount in one or more closings (each, a “Closing”); each
Investor to purchase the number of Units in the respective amounts set forth
opposite the applicable Investor’s name on the signature pages attached hereto
in exchange for each Investor’s Purchase Price payable in full as specified in
Section 3 below; provided,
however, that unless waived by the Company, each Investor must agree to a
minimum investment of $1,000, or 500 Units.

     

    3.           Closing; Payment and
Delivery.  (a) Each Investor shall deliver, or cause to be
delivered, the aggregate Purchase Price for the Units to be purchased by such
Investor to the Company, in immediately available funds, to be held by the
Company in a segregated, non-interest bearing bank account. 

     

    (b)           At
a Closing, each Investor shall subscribe for Units by executing, completing and
delivering its signature pages to this Agreement indicating such and signature
pages to the Registration Rights Agreement all in accordance with the
instructions set forth in the Subscription Instructions which accompany this
Agreement (“Subscription
Instructions”), and the Company, in its discretion, may accept such
subscription.  The Closing shall occur at the offices of Blank Rome
LLP, The Chrysler Building, 405 Lexington Avenue, New York, New York 10174 at
1:00 p.m. Eastern Daylight Time (which time may be changed by the Company) at
which time the Company will execute this Agreement and the Purchase Price for
the Units being sold at the Closing shall be transferred by the Company to its
general banking account against delivery of the Shares and Warrants comprising
the Units being purchased.

     

    (c)           The
Company shall have the right to conduct multiple Closings; provided, however,
that (i) the Initial Closing shall occur on or about June 7, 2010 and (ii) any
additional Closing(s) shall occur on or prior to June 15, 2010 and (iii) the
Company shall not sell Units in this Offering in excess of the Maximum
Amount.  Each date on which a Closing occurs is referred to herein as
the “Closing
Date”.

     

    4.           Representations and
Warranties of the Company.  The Company hereby represents and
warrants to the Investors that, except as set forth in the schedules delivered
herewith, including without limitation any supplement, amendment or update
delivered in connection with any Closing occurring after the Initial Closing
(collectively, the “Disclosure
Schedules”):

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    4.1           Organization, Good Standing
and Qualification.  Each of the Company and its Subsidiary is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation and has all requisite corporate power
and authority to carry on its business as now conducted and to own its
properties. Each of the Company and its Subsidiary is duly qualified to do
business as a foreign corporation and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of property
makes such qualification or leasing necessary unless the failure to so qualify
has not had and could not reasonably be expected to have a Material Adverse
Effect. First Blush, Inc., a Delaware corporation, is the Company’s only
Subsidiary.

     

    4.2           Authorization.  The
Company has full power and authority and has taken all requisite action on the
part of the Company, its officers, directors and shareholders necessary for (i)
the authorization, execution and delivery of the Transaction Documents, (ii) the
authorization of the performance of all obligations of the Company hereunder or
thereunder, and (iii) the authorization, issuance (or reservation for issuance)
and delivery of the Securities. The Transaction Documents constitute the legal,
valid and binding obligations of the Company, enforceable against the Company in
accordance with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability,
relating to or affecting creditors’ rights generally.

     

    4.3           Capitalization.

     

    (a)           Schedule 4.3 sets
forth (a) the authorized capital stock of the Company on the date hereof; (b)
the number of shares of capital stock issued and outstanding; (c) the number of
shares of capital stock issuable pursuant to the Company’s equity compensation
plans; and (d) the number of shares of capital stock issuable and reserved for
issuance pursuant to securities (other than the Securities) exercisable for, or
convertible into or exchangeable for any shares of capital stock of the Company.
All of the issued and outstanding shares of the Company’s capital stock have
been duly authorized and validly issued and are fully paid, nonassessable and
free of pre-emptive rights and were issued in full compliance with applicable
state and federal securities law and any rights of third parties. All of the
issued and outstanding shares of capital stock of the Subsidiary have been duly
authorized and validly issued and are fully paid, nonassessable and free of
pre-emptive rights, were issued in full compliance with applicable state and
federal securities law and any rights of third parties and are owned by the
Company, beneficially and of record, subject to no lien, encumbrance or other
adverse claim. No Person is entitled to pre-emptive or similar statutory or
contractual rights with respect to any securities of the Company. There are no
outstanding warrants, options, convertible securities or other rights,
agreements or arrangements of any character under which the Company or any of
its Subsidiary is or may be obligated to issue any equity securities of any
kind.  Except as described on Schedule 4.3, and
except for the Registration Rights Agreement, there are no voting agreements,
buy-sell agreements, option or right of first purchase agreements or other
agreements of any kind among the Company and any of the securityholders of the
Company relating to the securities of the Company held by them. Except as
described on Schedule
4.3 and except as provided in the Registration Rights Agreement, no
Person has the right to require the Company to register any securities of the
Company under the 1933 Act, whether on a demand basis or in connection with the
registration of securities of the Company for its own account or for the account
of any other Person.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

    

    (b)           Except
as described on Schedule 4.3, the
issuance and sale of the Securities hereunder will not obligate the Company to
issue shares of Common Stock or other securities to any other Person (other than
the Investors) and will not result in the adjustment of the exercise,
conversion, exchange or reset price of any outstanding security.

     

    (c)           The
Company does not have outstanding stockholder purchase rights or “poison pill”
or any similar arrangement in effect giving any Person the right to purchase any
equity interest in the Company upon the occurrence of certain
events.

     

    4.4           Valid
Issuance.  Upon the due exercise of the Warrants, the Warrant
Shares, will be validly issued, fully paid and non-assessable free and clear of
all encumbrances and restrictions, except for restrictions on transfer set forth
in the Transaction Documents or imposed by applicable securities laws and except
for those created by the Investors.  Assuming an Exercise Price of
$1.00, the Company has reserved a sufficient number of shares of Common Stock
for issuance upon the exercise of the Warrants, free and clear of all
encumbrances and restrictions, except for restrictions on transfer set forth in
the Transaction Documents or imposed by applicable securities laws and except
for those created by the Investors.

     

    4.5           Consents.  Except
as described in Schedule 4.5, the
execution, delivery and performance by the Company of the Transaction Documents,
and the offer, issuance and sale of the Securities, require no consent of,
action by or in respect of, or filing with, any Person, governmental body,
agency, or official other than (i) filings that have been made pursuant to
applicable state securities laws and post-sale filings pursuant to applicable
state and federal securities laws or any other notices required thereby, all of
which the Company undertakes to file within the applicable time periods, and
(ii) those consents or filings which could not reasonably be expected to have a
Material Adverse Effect.  Subject to the accuracy of the
representations and warranties of each Investor set forth in Section 5 hereof, the Company
has taken all action necessary to exempt (i) the issuance and sale of the Units,
(ii) the issuance of the Shares, (iii) the issuance of the Warrant Shares upon
due exercise of the Warrants, and (iv) the other transactions contemplated by
the Transaction Documents from the provisions of any stockholder rights plan or
other “poison pill” arrangement, any anti-takeover, business combination or
control share law or statute binding on the Company or to which the Company or
any of its assets and properties may be subject and any provision of the
Company’s Certificate of Incorporation or Bylaws that is or could reasonably be
expected to become applicable to the Investors as a result of the transactions
contemplated hereby, including without limitation, the issuance of the
Securities and the ownership, disposition or voting of the Securities by the
Investors or the exercise of any right granted to the Investors pursuant to this
Agreement or the other Transaction Documents.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

    4.6           Delivery of SEC Filings;
Business.  The Company has made available to the Investors
through the EDGAR system, true and complete copies of the Company’s Annual
Report on Form 10-K for the fiscal year ended December 31, 2009 (the “10-K”), and all other
reports filed by the Company, including without limitation the Current Report on
Form 8-K filed on May 13, 2010, as amended on May 25, 2010, pursuant to the 1934
Act since the filing of the 10-K and prior to the date hereof (collectively, the
“SEC Filings”).
The SEC Filings are the only filings required of the Company pursuant to the
1934 Act for such period. During such period, the Company and its Subsidiary
engaged in all material respects only in the business described in the SEC
Filings and the SEC Filings contained a complete and accurate description in all
material respects of the business of the Company and its Subsidiary, taken as a
whole, as of the date of each SEC Filing.

     

    4.7           Use of
Proceeds.  The net proceeds from this Offering (after payment
of the expenses of this Offering and the other matters contemplated hereby) will
be used primarily for the production of additional inventory in order to allow
the Company to take on new chain customers.

     

    4.8           SEC
Filings.  At the time of filing thereof, the SEC Filings
complied as to form in all material respects with the requirements of the 1934
Act and did not contain any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements made therein, in the
light of the circumstances under which they were made, not
misleading.

     

    4.9           No Conflict, Breach,
Violation or Default.  The execution, delivery and performance
of the Transaction Documents by the Company and the issuance and sale of the
Securities will not conflict with or result in a breach or violation of any of
the terms and provisions of, or constitute a default under (i) the Company’s
Certificate of Incorporation or the Company’s Bylaws, both as in effect on the
date hereof (true and complete copies of which have been made available to the
Investors), or (ii)(a) any statute, rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company, any Subsidiary or any of their respective assets
or properties, or (b) any agreement or instrument to which the Company or its
Subsidiary is a party or by which the Company or its Subsidiary is bound or to
which any of their respective assets or properties is subject, except in the
case of clause (ii) for such breaches, violations or defaults which could not
reasonably be expected to have a Material Adverse Effect.

     

    4.10           Tax
Matters.  The Company and its Subsidiary has timely prepared
and filed all tax returns required to have been filed by the Company or such
Subsidiary with all appropriate governmental agencies and timely paid all taxes
shown thereon or otherwise owed by it, other than those returns and taxes for
which an extension has been timely filed.  The charges, accruals and
reserves on the books of the Company in respect of taxes for all fiscal periods
are adequate in all material respects, and there are no material unpaid
assessments against the Company or any Subsidiary nor, to the Company’s
Knowledge, any basis for the assessment of any additional taxes, penalties or
interest for any fiscal period or audits by any federal, state or local taxing
authority except for any assessment which is not material to the Company and its
Subsidiary, taken as a whole. All taxes and other assessments and levies that
the Company or any Subsidiary is required to withhold or to collect for payment
have been duly withheld and collected and paid to the proper governmental entity
or third party when due. There are no tax liens or claims pending or, to the
Company’s Knowledge, threatened against the Company or its Subsidiary or any of
their respective assets or property. Except as described on Schedule 4.10, there
are no outstanding tax sharing agreements or other such arrangements between the
Company and any Subsidiary or other corporation or entity.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

    

    4.11           Title to
Properties.  Except as disclosed in Schedule 4.11, each
of the Company and its Subsidiary has good and marketable title to all real
properties and all other properties and assets owned by it, in each case free
from liens, encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or currently planned to be
made thereof by them; and except as disclosed in Schedule 4.11, the
Company and its Subsidiary holds any leased real or personal property under
valid and enforceable leases with no exceptions that would materially interfere
with the use made or currently planned to be made thereof by them.

     

    4.12           Certificates, Authorities
and Permits.  The Company and its Subsidiary possess adequate
certificates, authorities or permits issued by appropriate governmental agencies
or bodies necessary to conduct the business now operated by it, and neither the
Company nor any Subsidiary has received any notice of proceedings relating to
the revocation or modification of any such certificate, authority or permit
that, if determined adversely to the Company or such Subsidiary, could
reasonably be expected to have a Material Adverse Effect, individually or in the
aggregate.

     

    4.13           Labor
Matters.

     

    (a)           The
Company is not a party to or bound by any collective bargaining agreements or
other agreements with labor organizations. The Company has not violated in any
material respect any laws, regulations, orders or contract terms, affecting the
collective bargaining rights of employees, labor organizations or any laws,
regulations or orders affecting employment discrimination, equal opportunity
employment, or employees’ health, safety, welfare, wages and hours.

     

    (b)           (i)
There are no labor disputes existing, or to the Company’s Knowledge, threatened,
involving strikes, slow-downs, work stoppages, job actions, disputes, lockouts
or any other disruptions of or by the Company’s employees, (ii) there are no
unfair labor practices or petitions for election pending or, to the Company’s
Knowledge, threatened before any governmental agency or labor commission
relating to the Company’s employees, (iii) no demand for recognition or
certification heretofore made by any labor organization or group of employees is
pending with respect to the Company, and (iv) to the Company’s Knowledge, the
Company enjoys good labor and employee relations with its employees and labor
organizations.

     

    (c)           The
Company is, and at all times has been, in compliance in all material respects
with all applicable laws respecting employment (including laws relating to
classification of employees and independent contractors) and employment
practices, terms and conditions of employment, wages and hours, and immigration
and naturalization.

     

    (d)           Except
as disclosed in the SEC Filings or as described on Schedule 4.13, the
Company is not a party to, or bound by, any employment or other contract or
agreement that contains any severance, termination pay or change of control
liability or obligation, including, without limitation, any “excess parachute
payment,” as defined in Section 2806(b) of the Internal Revenue
Code.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

    4.14           Contracts.

     

    (a)           Except
as set forth in the SEC Filings or as described on Schedule 4.14,
neither the Company nor any of its Subsidiaries is party or subject to, or bound
by:

     

    (i)           any
agreements, contracts or commitments that call for prospective fixed and/or
contingent payments or expenditures by or to the Company or its Subsidiary of
more than $500,000, or which is otherwise material and not entered into in the
ordinary course of business;

     

    (ii)           any
contract, lease or agreement involving payments in excess of $500,000, which is
not cancelable by the Company or its Subsidiary, as applicable, without penalty
on not less than 60 days notice;

     

    (iii)           any
indenture, mortgage, promissory note, loan agreement, guaranty or other
agreement or commitment for the borrowing of money or pledging or granting a
security interest in any assets with a value in excess of $500,000;

     

    (iv)           any
employment contracts, non-competition agreements, invention assignments,
severance or other agreements with officers, directors, 5% or greater
stockholders, consultants (which, in the case of any consultant, involves
payments in excess of $120,000) of the Company or its Subsidiary or Persons
related to or affiliated with such Persons;

     

    (v)           any
stock redemption or purchase agreements or other agreements affecting or
relating to the capital stock of the Company or its Subsidiary, including,
without limitation, any agreement with any stockholder of the Company or its
Subsidiary which includes, without limitation, antidilution rights, voting
arrangements or operating covenants;

     

    (vi)           any
pension, profit sharing, retirement, stock option or stock ownership
plans;

     

    (vii)           any
royalty, dividend or similar arrangement based on the revenues or profits of the
Company or of its Subsidiary or based on the revenues or profits derived from
any material contract;

     

    (viii)          any
acquisition, merger, asset purchase or other similar agreement entered into in
the past five years; or

     

    (ix)           any
agreement under which the Company or its Subsidiary has granted any Person
registration rights for its securities (all such agreements, contracts or
instruments, collectively, the “Material
Contracts”).

     

    Each of
the Material Contracts is valid and in full force and effect, is enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar laws affecting
creditors’ rights generally and general principles of equity, and will continue
to be so immediately following the Closing Date.

     

    4.15           Intellectual
Property.  Except as specified in Schedule
4.15:

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

       

    

    (a)           All
Intellectual Property of the Company and its Subsidiary is currently in
compliance with all legal requirements (including timely filings, proofs and
payments of fees) and is valid and enforceable.

     

    (b)           The
Company and its Subsidiary own or have the valid right to use all of the
Intellectual Property that is necessary for the conduct of the Company’s and its
Subsidiary’s respective businesses as currently conducted and for the ownership,
maintenance and operation of the Company’s and its Subsidiary’s properties and
assets, free and clear of all liens, encumbrances, adverse claims or obligations
to license all such owned Intellectual Property and Confidential Information,
other than licenses entered into in the ordinary course of the Company’s and its
Subsidiary’s businesses.  To the Company’s Knowledge, the Company and
its Subsidiary have a valid and enforceable right to use all third party
Intellectual Property and Confidential Information used or held for use in the
respective businesses of the Company and its Subsidiaries.

     

    (c)           The
consummation of the transactions contemplated hereby and by the other
Transaction Documents will not result in the alteration, loss, impairment of or
restriction on the Company’s or its Subsidiary’s ownership or right to use any
of the Intellectual Property or Confidential Information which is necessary for
the conduct of Company’s and its Subsidiary’s respective businesses as currently
conducted.

     

    4.16           Environmental
Matters.  Except as specified in Schedule 4.16, to the
Company’s Knowledge, neither the Company nor its Subsidiary (i) is in violation
of any statute, rule, regulation, decision or order of any governmental agency
or body or any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection or
restoration of the environment or human exposure to hazardous or toxic
substances (collectively, “Environmental Laws”),
(ii) owns or operates any real property contaminated with any substance that is
subject to any Environmental Laws, (iii) is liable for any off-site disposal or
contamination pursuant to any Environmental Laws, or (iv) is subject to any
claim relating to any Environmental Laws, which violation, contamination,
liability or claim has had or could reasonably be expected to have a Material
Adverse Effect, individually or in the aggregate; and there is no pending or, to
the Company’s Knowledge, threatened investigation that might lead to such a
claim.

     

    4.17           Litigation.  Except
as described on Schedule 4.17, there
are no pending actions, suits or proceedings against or affecting the Company,
its Subsidiaries or any of its or their properties; and to the Company’s
Knowledge, no such actions, suits or proceedings are threatened or
contemplated.

     

    4.18           Financial
Statements.  The financial statements included in each SEC
Filing made after January 1, 2010, present fairly, in all material respects, the
consolidated financial position of the Company as of the dates shown and its
consolidated results of operations and cash flows for the periods shown, and
such financial statements have been prepared in conformity with United States
generally accepted accounting principles applied on a consistent basis (“GAAP”) (except as may
be disclosed therein or in the notes thereto, and, in the case of quarterly
financial statements, as permitted by Form 10-Q under the 1934 Act). Except as
set forth in the financial statements of the Company included in the SEC Filings
filed prior to the date hereof or as described on Schedule 4.18,
neither the Company nor its Subsidiary has incurred any liabilities, contingent
or otherwise, except those incurred in the ordinary course of business,
consistent (as to amount and nature) with past practices since the date of such
financial statements, none of which, individually or in the aggregate, have had
or could reasonably be expected to have a Material Adverse Effect.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

    4.19           Insurance
Coverage.  Except as set forth on Schedule 4.19, the
Company and its Subsidiary maintains in full force and effect insurance coverage
that is customary for comparably situated companies for the business being
conducted and properties owned or leased by the Company and each Subsidiary, and
the Company reasonably believes such insurance coverage to be adequate against
all liabilities, claims and risks against which it is customary for comparably
situated companies to insure.

     

    4.20           Brokers and
Finders.  No Person will have, as a result of the transactions
contemplated by the Transaction Documents, any valid right, interest or claim
against or upon the Company, its Subsidiary or an Investor for any commission,
fee or other compensation pursuant to any agreement, arrangement or
understanding entered into by or on behalf of the Company, other than as
described in Schedule
4.20.

     

    4.21           No Directed Selling Efforts
or General Solicitation.  Neither the Company nor any Person
acting on its behalf has conducted any general solicitation or general
advertising (as those terms are used in Regulation D) in connection with the
offer or sale of any of the Securities.

     

    4.22           No Integrated
Offering.  Neither the Company nor any of its Affiliates, nor
any Person acting on its or their behalf has, directly or indirectly, made any
offers or sales of any Company security or solicited any offers to buy any
security, under circumstances that would adversely affect reliance by the
Company on Section 4(2) for the exemption from registration for the transactions
contemplated hereby or would require registration of the Securities under the
1933 Act.

     

    4.23           Private
Placement.  Assuming the truth and accuracy of the
representation and warranties set forth in Sections 5.1 through 5.13, the offer and
sale of the Securities to the Investors as contemplated hereby is exempt from
the registration requirements of the 1933 Act.

     

    4.24           Internal
Controls.  The Company is in material compliance with the
provisions of the Sarbanes-Oxley Act of 2002 currently applicable to the
Company. The Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
asset accountability, (iii) access to assets is permitted only in accordance
with management’s general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any
differences.  The Company has established disclosure controls and
procedures (as defined in 1934 Act Rules 13a-15(e) and 15d-15(e) for the Company
and designed such disclosure controls and procedures to ensure that material
information relating to the Company, including the Subsidiaries, is made known
to the certifying officers by others within those entities, particularly during
the period in which the Company’s most recently filed periodic report under the
1934 Act, as the case may be, is being prepared. The Company’s certifying
officers have evaluated the effectiveness of the Company’s controls and
procedures as of the end of the period covered by the most recently filed
periodic report under the 1934 Act (such date, the “Evaluation Date”).
The Company presented in its most recently filed periodic report under the 1934
Act the conclusions of the certifying officers about the effectiveness of the
disclosure controls and procedures based on their evaluations as of the
Evaluation Date.  Except as set forth on Schedule 4.24, since
the Evaluation Date, there have been no significant changes in the Company’s
internal control over financial reporting (as such term is defined in the 1934
Act) that have materially affected, or are reasonably likely to materially
affect, the Company’s internal control over financial reporting.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

       

    

    4.25           Solvency.  The
Company has not (a) made a general assignment for the benefit of creditors; (b)
filed any voluntary petition in bankruptcy or suffered the filing of any
involuntary petition by its creditors; (c) suffered the appointment of a
receiver to take possession of all, or substantially all, of its assets; (d)
suffered the attachment or other judicial seizure of all, or substantially all,
of its assets; or (e) made an offer of settlement, extension or composition to
its creditors generally.

     

    4.26           
Related Party
Transactions.  Except as set forth in the SEC Reports or Schedule 4.26: (a)
none of the Company or any of its Affiliates, officers, directors, holders of 5%
or more of the outstanding common stock of the Company or employees, or any
Affiliate of any of such Person, has any material interest in any property, real
or personal, tangible or intangible, including the Company’s Intellectual
Property, used in or pertaining to the business of the Company, except for the
normal rights of a stockholder, or, to the Knowledge of the Company, any
supplier, distributor or customer of the Company; (b) there are no agreements,
understandings or proposed transactions between the Company and any of its
officers, directors, employees, Affiliates, or, to the Company's Knowledge, any
Affiliate thereof; (c) to the Company’s knowledge, no employee,
officer or director of the Company or any of its Subsidiaries has any direct or
indirect ownership interest in any firm or corporation with which the Company is
affiliated or with which the Company has a business relationship, or any firm or
corporation that competes with the Company; (d) to the Company’s Knowledge, no member of
the immediate family of any officer or director of the Company is directly or
indirectly interested in any Material Contract; or (e) there are no amounts owed
(cash and stock) to officers, directors and consultants (salary, bonuses or
other forms of compensation in excess of $250,000 in the
aggregate).

     

    5.           Representations and
Warranties of the Investors.  Each Investor hereby severally,
and not jointly, represents and warrants to the Company that:

     

    5.1           Organization and
Existence.  Such Investor is an individual or a validly
existing corporation, limited partnership, limited liability company or other
entity identified in the Subscription Documents and has all requisite
individual, corporate, partnership or limited liability company power or other
entity and authority, as applicable, to invest in the Securities pursuant to
this Agreement.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

       

    

    5.2           Authorization.  The
execution, delivery and performance by such Investor of the Transaction
Documents to which such Investor is a party have been duly authorized and will
each constitute the valid and legally binding obligation of such Investor,
enforceable against such Investor in accordance with their respective terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability, relating to or affecting
creditors’ rights generally.

     

    5.3           Purchase Entirely for Own
Account.  The Securities to be received by such Investor
hereunder will be acquired for such Investor’s own account, not as nominee or
agent, and not with a view to the resale or distribution of any part thereof in
violation of the 1933 Act, and such Investor has no present intention of
selling, granting any participation in, or otherwise distributing the same in
violation of the 1933 Act without prejudice, however, to such Investor’s right
at all times to sell or otherwise dispose of all or any part of such Securities
in compliance with applicable federal and state securities
laws.  Nothing contained herein shall be deemed a representation or
warranty by such Investor to hold the Securities for any period of time. Such
Investor is not a broker-dealer registered with the SEC under the 1934 Act or an
entity engaged in a business that would require it to be so
registered.

     

    5.4           Investment
Experience.  Such Investor acknowledges that it can bear the
economic risk and complete loss of its investment in the Securities and has such
knowledge and experience in financial or business matters that it is capable of
evaluating the merits and risks of the investment contemplated
hereby.

     

    5.5           Disclosure of
Information.  Such Investor has had an opportunity to receive
all information related to the Company requested by it and to ask questions of
and receive answers from the Company regarding the Company, its business and the
terms and conditions of the Offering. Such Investor acknowledges receipt of
and/or access to copies of the SEC Filings. Neither such inquiries nor any other
due diligence investigation conducted by such Investor shall modify, amend or
affect such Investor’s right to rely on the Company’s representations and
warranties contained in this Agreement.

     

    5.6           Restricted
Securities.  Such Investor understands that the Securities are
characterized as “restricted securities” under the U.S. federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under such laws and applicable regulations
such securities may be resold without registration under the 1933 Act only in
certain limited circumstances.  Such Investor also acknowledges that
the Company was a shell company under the federal securities laws and as such,
the ability of the Investor to transfer any of the Securities may be subject to
more limitation than securities of a company that was never a shell
company.

     

    5.7           Legends.  It
is understood that, except as provided below, any certificates evidencing the
Securities may bear the following or any similar legend:

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

       

    

    (a)           THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT
OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE COMPANY.

     

    (b)           If
required by the authorities of any state in connection with the issuance or sale
of the Securities, the legend required by such state authority.

     

    5.8           Accredited
Investor.  Such Investor is an “accredited investor” within the
meaning of Rule 501(a) of Regulation D for the reasons checked in the
Subscription Documents.

     

    5.9           No General
Solicitation.  Such Investor did not learn of the investment in
the Securities as a result of any public advertising or general
solicitation.

     

    5.10           Brokers and
Finders.  No Person will have, as a result of the transactions
contemplated by the Transaction Documents, any valid right, interest or claim
against or upon the Company, its Subsidiary or an Investor for any commission,
fee or other compensation pursuant to any agreement, arrangement or
understanding entered into by or on behalf of such Investor.

     

    5.11           Certain Trading
Activities.  Such Investor has not directly or indirectly, nor
has any Person acting on behalf of or pursuant to any understanding with such
Investor, engaged in any transactions in the securities of the Company
(including, without limitations, any Short Sales involving the Company’s
securities) since the time that such Investor was first contacted by the Company
regarding an investment in the Company.  Such Investor covenants that
neither it nor any Person acting on its behalf or pursuant to any understanding
with it will engage in any transactions in the securities of the Company
(including Short Sales) prior to the time that the transactions contemplated by
this Agreement are publicly disclosed.

     

    5.12           Reliance on
Exemptions.  Such Investor understands that the Securities are
being offered and sold to it in reliance upon specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying upon the truth and accuracy of, and such Investor’s
compliance with, the representations, warranties, agreements, acknowledgments
and understandings of such Investor set forth herein in order to determine the
availability of such exemptions and the eligibility of such Investor to acquire
the Securities.

     

    5.13           Address.  Investor’s
address set forth on Investor’s counterpart signature page is the address of
Investor’s principal place of business.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

       

    

    6.           Conditions to
Closing.

     

    6.1           Conditions to the Investors’
Obligations.  The obligation of an Investor to purchase the
Units at a Closing is subject to the fulfillment to such Investor’s
satisfaction, on or prior to the applicable Closing Date, of the following
conditions, any of which may be waived by an Investor:

     

    (a)           The
representations and warranties made by the Company in Section 4 hereof qualified as
to materiality shall be true and correct at all times prior to and on the
Closing Date, except to the extent any such representation or warranty expressly
speaks as of a specific date, in which case such representation or warranty
shall be true and correct as of such date, and, the representations and
warranties made by the Company in Section 4 hereof not
qualified as to materiality shall be true and correct in all material respects
at all times prior to and on the Closing Date, except to the extent any such
representation or warranty expressly speaks as of a specific date, in which case
such representation or warranty shall be true and correct in all material
respects as of such specific date.

     

    (b)           The
Company shall have performed in all material respects all obligations and
covenants herein required to be performed by it on or prior to the Closing
Date.

     

    (c)           The
Company shall have obtained any and all consents, permits, approvals,
registrations and waivers necessary or appropriate for consummation of the
purchase and sale of the Shares and Warrants and the consummation of the other
transactions contemplated by the Transaction Documents to be consummated on or
prior to the Closing Date, all of which shall be in full force and
effect.

     

    (d)           The
Company shall have executed and delivered the Shares, Warrants and the
Registration Rights Agreement.

     

    (e)           No
judgment, writ, order, injunction, award or decree of or by any court, or judge,
justice or magistrate, including any bankruptcy court or judge, or any order of
or by any governmental authority, shall have been issued, and no action or
proceeding shall have been instituted by any governmental authority, enjoining
or preventing the consummation of the transactions contemplated hereby or in the
other Transaction Documents.

     

    (f)           The
Company shall have delivered a Certificate, executed on behalf of the Company by
its Chief Executive Officer or its Chief Financial Officer, dated as of the
Closing Date, certifying to the fulfillment of the conditions specified in
subsections (a), (b) and (c) of this Section 6.1.

     

    (g)           The
Company shall have delivered a Certificate, executed on behalf of the Company by
its Secretary or Assistant Secretary, dated as of the Closing Date, certifying
the resolutions adopted by the Board of Directors of the Company approving the
transactions contemplated by this Agreement and the other Transaction Documents
and the issuance of the Securities, certifying the current versions of the
Certificate of Incorporation and Bylaws of the Company and certifying as to the
signatures and authority of persons signing the Transaction Documents and
related documents on behalf of the Company.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

       

    

    (h)           The
Investors shall have received an opinion of Blank Rome LLP, in form and
substance reasonably acceptable to the Investors as to the corporate
organization and good standing of the Company, due authorization of the
transactions contemplated hereby and the enforceability of this
Agreement.

     

    (i)           No
stop order or suspension of trading shall have been imposed by the SEC or any
other governmental or regulatory body with respect to public trading in the
Common Stock.

     

    (j)           Since
the date of execution of this Agreement, no event or series of events shall have
occurred that reasonably could have or result in a Material Adverse
Effect.

     

    6.2           Conditions to Obligations of
the Company.  The Company’s obligation to sell and issue the
Units at a Closing is subject to the fulfillment to the satisfaction of the
Company on or prior to the applicable Closing Date of the following conditions,
any of which may be waived by the Company:

     

    (a)           The
representations and warranties made by the Investors in Section 5 hereof and in the
Subscription Documents shall be true and correct in all material respects when
made and shall be true and correct in all material respects on the Closing Date
with the same force and effect as if they had been made on and as of said
date.  The Investors shall have performed in all material respects all
obligations and covenants herein required to be performed by them on or prior to
the Closing Date.

     

    (b)           The
Investors shall have executed and delivered the Registration Rights
Agreement.

     

    (c)           No
judgment, writ, order, injunction, award or decree of or by any court, or judge,
justice or magistrate, including any bankruptcy court or judge, or any order of
or by any governmental authority, shall have been issued, and no action or
proceeding shall have been instituted by any governmental authority, enjoining
or preventing the consummation of the transactions contemplated hereby or in the
other Transaction Documents

     

    (d)           The
Company shall have received the Purchase Price for the Units to be sold at the
Closing.

     

    6.3           Termination of Obligations
to Effect Closing; Effects.

     

    (a)           The
outstanding obligations of the Company, on the one hand, and each Investor, on
the other hand, to effect a Closing shall terminate as follows:

     

    (i)           By
the Company if any of the conditions set forth in Section 6.2 shall have become
incapable of fulfillment, and shall not have been waived by the
Company;

     

    (ii)           By
an Investor if any of the conditions set forth in Section 6.1 shall have become
incapable of fulfillment, and shall not have been waived by such Investor;
and

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    (iii)           By
the Company, if the Closing has not occurred on or prior to June 15,
2010;

     

    provided, however, that, except
in the case of clause (i) above, the party seeking to terminate its obligation
to effect the Closing shall not then be in breach of any of its representations,
warranties, covenants or agreements contained in this Agreement or the other
Transaction Documents if such breach has resulted in the circumstances giving
rise to such party’s seeking to terminate its obligation to effect the
Closing.

     

    7.           Covenants and Agreements of
the Company.

     

    7.1           Reservation of Common
Stock.  The Company shall at all times reserve and keep
available out of its authorized but unissued shares of Common Stock, solely for
the purpose of providing for the exercise of the Warrants, such number of shares
of Common Stock as shall from time to time equal a good faith estimate of the
Warrant Shares issuable from time to time.

     

    7.2           Compliance with
Laws.  The Company will comply in all material respects with
all applicable laws, rules, regulations, orders and decrees of all governmental
authorities.

     

    7.3           Listing of Underlying Shares
and Related Matters.  If the Company applies to have its Common
Stock or other securities traded on any stock exchange or market, it shall
include in such application the Shares and the Warrant Shares and will take such
other action as is necessary to cause such Common Stock to be so listed.
Thereafter, the Company will use commercially reasonable efforts to continue the
listing and trading of its Common Stock on such exchange or market and, in
accordance, therewith, will use commercially reasonable efforts to comply in all
respects with the Company’s reporting, filing and other obligations under the
bylaws or rules of such exchange or market, as applicable.

     

    7.4           Removal of
Legends.  Certificates evidencing Securities shall not be
required to contain any legend (including the legend set forth in Section 5.7): (i) following a
sale or transfer of such Securities pursuant to an effective registration
statement under the 1933 Act, or (ii) following a sale or transfer of such
Securities pursuant to Rule 144 (assuming the transferee is not an Affiliate of
the Company).

     

    7.5           Furnishing of
Information.  As
long as any Investor owns the Securities, the Company covenants to use
commercially reasonable efforts to timely file (or obtain extensions in respect
thereof and file within the applicable grace period) all reports required to be
filed by the Company after the date hereof pursuant to the 1934
Act.  As long as any Investor owns Securities, if the Company is not
required to file reports pursuant to such laws, it will prepare and furnish to
the Investors and make publicly available in accordance with Rule 144 such
information as is required to satisfy the “public information” requirements of
Rule 144.

     

    7.6           Integration.  The
Company shall not, and shall use its best efforts to ensure that no Affiliate of
the Company shall, sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in Section 2 of the 1933 Act)
that would be integrated with the offer or sale of the Securities in a manner
that would require the registration under the 1933 Act of the sale of the
Securities to the Investors, or that would be integrated with the offer or sale
of the Securities for purposes of the rules and regulations of any Trading
Market in a manner that would require stockholder approval of the sale of the
Securities to the Investors.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

       

    

    8.           Survival and
Indemnification.

     

    8.1           Survival.  The
representations, warranties, covenants and agreements contained in this
Agreement shall survive the Closing of the transactions contemplated by this
Agreement.

     

    8.2           Indemnification.  The
Company agrees to indemnify and hold harmless each Investor and its Affiliates
and their respective directors, officers, employees and agents from and against
any and all losses, claims, damages, liabilities and expenses (including without
limitation reasonable attorney fees and disbursements and other expenses
incurred in connection with investigating, preparing or defending any action,
claim or proceeding, pending or threatened and the costs of enforcement thereof)
(collectively, “Losses”) to which
such Person may become subject as a result of any material breach of
representation, warranty, covenant or agreement made by or to be performed on
the part of the Company under the Transaction Documents, and will reimburse any
such Person for all such amounts as they are incurred by such Person; provided
that any reimbursement under this Article 8 to an Investor, its affiliates,
directors, officers, employees and agents shall be limited to the total purchase
price paid by the Investor for the Units purchased by such Investor
hereunder.

     

    8.3           Conduct of Indemnification
Proceedings.  Promptly after receipt by any Person (the “Indemnified Person”)
of notice of any demand, claim or circumstances which would or might give rise
to a claim or the commencement of any action, proceeding or investigation in
respect of which indemnity may be sought pursuant to Section 8.2, such Indemnified
Person shall promptly notify the Company in writing and the Company shall assume
the defense thereof, including the employment of counsel reasonably satisfactory
to such Indemnified Person, and shall assume the payment of all fees and
expenses; provided, however,  that the failure of any Indemnified
Person so to notify the Company shall not relieve the Company of its obligations
hereunder except to the extent that the Company is materially prejudiced by such
failure to notify. In any such proceeding, any Indemnified Person shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such Indemnified Person unless: (i) the Company and the
Indemnified Person shall have mutually agreed to the retention of such counsel;
or (ii) in the reasonable judgment of counsel to the Company representation of
both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. The Company shall not be liable for
any settlement of any proceeding effected without its written consent, which
consent shall not be unreasonably withheld, but if settled with such consent, or
if there be a final judgment for the plaintiff, the Company shall indemnify and
hold harmless such Indemnified Person from and against any loss or liability (to
the extent stated above) by reason of such settlement or judgment. Without the
prior written consent of the Indemnified Person, which consent shall not be
unreasonably withheld, the Company shall not effect any settlement of any
pending or threatened proceeding in respect of which any Indemnified Person is
or could have been a party and indemnity could have been sought hereunder by
such Indemnified Party, unless such settlement includes an unconditional release
of such Indemnified Person from all liability arising out of such
proceeding.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

       

    

    9.           Dispute
Resolution.

     

    9.1           Any
controversy or claim that arises out of or relating to any Transaction Document,
or the breach thereof, shall be finally settled by arbitration administered by
the American Arbitration Association in accordance with its Commercial
Arbitration Rules, and judgment on any award rendered by the arbitrator may be
entered by any court having jurisdiction thereof.

     

    9.2           Any
arbitration conducted pursuant to this Section 9 shall be conducted before a
single neutral arbitrator who shall be a member of the Bar of the State of
Delaware actively engaged in the practice of law for at least ten years and
experienced in the area of corporate law.

     

    9.3           The
place of arbitration shall be Wilmington, Delaware.

     

    9.4           Any
arbitration conducted pursuant to this Section 9 shall be conducted under the
laws of the State of Delaware.  The parties acknowledge that the
Transaction Documents evidence a transaction involving interstate
commerce.  The Federal Arbitration Act and the Commercial Arbitration
Rules of the American Arbitration Association shall govern the interpretation,
enforcement, and proceedings pursuant to the arbitration clause in this Section
9.

     

    9.5           If
more than one arbitration is at any time pending under this Section 9 and any
party contends that two or more arbitrations are substantially related and that
the issue should be heard in one proceeding, the arbitrator selected in the
first-filed of such proceedings shall determine whether, in the interests of
justice and efficiency, the proceedings should be consolidated before that
arbitrator.

     

    9.6           Consistent
with the expedited nature of arbitration, each party will, upon the written
request of any other party, promptly provide such other party with copies of
documents relevant to the issues raised by any claim or
counterclaim.  Any dispute regarding discovery, or the relevance or
scope thereof, shall be determined by the arbitrator in such arbitration, which
determination shall be conclusive.  All discovery shall be completed
within forty-five days following the appointment of the arbitrator.

     

    9.7           The
award in any arbitration commenced under this Section 9 shall be made within
nine (9) months of the filing of the related demand for arbitration, and the
arbitrator in such arbitration shall agree to comply with such schedule before
accepting appointment, provided that such time limit may be extended by
agreement of the parties or by the arbitrator if the arbitrator determines that
the same is necessary.

     

    9.8           No
arbitrator appointed pursuant to this Section 9 shall have any authority to
award punitive or other damages not measured by the prevailing party’s actual
damages, except as may be required by statute.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

       

    

    9.9           The
arbitrator in any arbitration pursuant to this Section 9 shall award to the
prevailing party, if any as determined by the arbitrator, all of its costs and
fees.  For such purposes, “costs and fees” shall mean all reasonable
pre-award expenses of the arbitration and the mediation, if any, including the
arbitrator’s fees, the mediator’s fees, administrative fees, travel expenses,
out-of-pocket expenses such as copying and telephone, court costs, witness fees,
reasonable attorney’s fees and all other costs reasonably incurred by the
prevailing party in enforcing its rights under any Transaction
Document.

     

    9.10           The
finding of the arbitrator in any arbitration under this Section 9 will be final
and binding. Judgment on any award rendered by the arbitrator may be entered in
any court having jurisdiction thereover; provided, that any award of specific
performance shall (a) be documented in a detailed written opinion containing
findings of fact and law, and (b) be subject to review by any court to which
such award is submitted for entry to the same extent that a similar award by the
Delaware Court of Chancery would be subject to review by the Delaware Supreme
Court.

     

    10.           Miscellaneous.

     

    10.1           Confidentiality.

     

    (a)           All
information furnished by the Company or its Representatives (as defined below),
whether furnished before or after the date hereof, and regardless of the manner
in which it is furnished, is referred to in this Agreement as “Proprietary
Information”.  Proprietary Information does not include,
however, information which (a) is or becomes generally available to the public
other than as a result of a disclosure by an Investor or its Representatives,
(b) was available to an Investor on a nonconfidential basis prior to its
disclosure to an Investor by the Company or its Representatives, or
(c) becomes available to an Investor on a nonconfidential basis from a
person, other than the Company or any of its Representatives, who is not bound
by a confidentiality agreement with or other contractual, legal or fiduciary
obligation to the Company.  As used in this Agreement, the term “Representative”
means, as to any person, such person's affiliates and its and their directors,
officers, employees, agents, advisors (including, without limitation, financial
advisors, counsel and accountants) and controlling persons.  As used
in this letter agreement, the term "person" shall be broadly interpreted to
include, without limitation, any corporation, company, partnership, other entity
or individual.

     

    (b)           Each
Investor shall keep strictly confidential all Proprietary Information and will
not, without express written authorization signed by an authorized officer of
the Company, use, sell, market or disclose any Confidential Information to any
person for any purpose.  Each Investor shall be responsible for any
breach of this Agreement by any of its Representatives and shall, at its sole
expense, take all reasonable measures (including but not limited to court
proceedings) to restrain its Representatives from prohibited or unauthorized
disclosure of use of the Proprietary Information. Each Investor shall
immediately notify the Company of any unauthorized disclosure and, without
affecting the Company’s rights as a result thereof, take all steps necessary to
prevent further disclosure.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

       

    

    (c)           In
the event that an Investor is required by, law, regulation, legal process or
regulatory authority to disclose any Proprietary Information or any other
information concerning the Company, such Investor shall provide the Company with
prompt written notice of such request or requirement (to the extent not
prohibited by law or legal process) in order to enable the Company to seek an
appropriate protective order or other remedy, to not object to the Company's
taking steps (at its sole expense) to resist or narrow the scope of such request
or legal process, or to waive compliance, in whole or in part, with the terms of
this Agreement.  If, in the absence of a protective order or other
remedy or waiver of the terms of this letter agreement, an Investor determines
upon the opinion of its legal counsel that such Investor or any Representative
is required by, law, regulation, legal process or regulatory authority to
disclose any Proprietary Information or other information concerning the
Company, such Investor or such Representative may disclose only such Proprietary
Information or other information as must be disclosed by law, regulation, legal
process or regulatory authority and shall exercise reasonable efforts to obtain
assurances that such Proprietary Information or other information will be
accorded confidential treatment.

     

    10.2           Successors and
Assigns.  This Agreement may not be assigned by a party hereto
without the prior written consent of the Company or the Investors, as
applicable, provided, however, that an Investor may assign its rights and
delegate its duties hereunder in whole or in part to an Affiliate or to a third
party acquiring some or all of its Securities in a private transaction without
the prior written consent of the Company or the other Investors, after notice
duly given by such Investor to the Company provided, that no such assignment or
obligation shall affect the obligations of such Investor hereunder. The
provisions of this Agreement shall inure to the benefit of and be binding upon
the respective permitted successors and assigns of the parties. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.

     

    10.3           Counterparts;
Faxes.  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. This Agreement may also
be executed via facsimile, which shall be deemed an original.

     

    10.4           Titles and
Subtitles.  The titles and subtitles used in this Agreement are
used for convenience only and are not to be considered in construing or
interpreting this Agreement.

     

    10.5           Notices.  Unless
otherwise provided, any notice required or permitted under this Agreement shall
be given in writing and shall be deemed effectively given as hereinafter
described (i) if given by personal delivery, then such notice shall be deemed
given upon such delivery, (ii) if given by telex or telecopier, then such notice
shall be deemed given upon receipt of confirmation of complete transmittal,
(iii) if given by mail, then such notice shall be deemed given upon the earlier
of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, (iv) if given by an
internationally recognized overnight air courier, then such notice shall be
deemed given one Business Day after delivery to such carrier, and (v) if given
by electronic mail, then such notice shall be deemed given upon transmission
thereof. All notices shall be addressed to the party to be notified at the
address as follows, or at such other address as such party may designate by ten
days’ advance written notice to the other party:

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

       

    

    If to the
Company:

     

    AFH
Holding II, Inc./First Blush Brands, Inc.

    9595
Wilshire Blvd., Suite #900

    Beverly
Hills, CA 90212

    Attn:  Barrett
A. Carrere

    Fax:

    E-mail:
barrett@firstblush.com

     

    With a
copy to:

     

    Blank
Rome LLP

    The
Chrysler Building

    405
Lexington Avenue

    New York,
NY 10174

    Attn:
Pamela E. Flaherty, Esq.

    Fax:  917-332-3733

    E-mail:
pflaherty@blankrome.com

     

    If to the
Investors:

     

    to the
addresses set forth on the signature pages hereto.

     

    

    10.6           Expenses.  Except
as set forth under Section 8 hereof, each party
shall pay, or make provision for the payment of, their own fees and expenses in
connection with this Agreement, the other Transaction Documents and the
transactions contemplated hereby and thereby.

     

    10.7           Amendments and
Waivers.  Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and Investors holding a majority of the Shares
outstanding.  Any amendment or waiver effected in accordance with this
paragraph shall be binding upon each holder of any Securities purchased under
this Agreement at the time outstanding, each future holder of all such
Securities, and the Company.  Notwithstanding the foregoing, no
consideration shall be offered or paid by the Company to any Investor to amend
or consent to a waiver or modification of any provision of any of this Agreement
unless the same consideration also is offered to all of the holders of the
Shares and/or Warrants.

     

    10.8           Publicity.  No
public release or announcement concerning the transactions contemplated hereby
shall be issued by the Company or the Investors without the prior consent of the
Company (in the case of a release or announcement by the Investors) or the
Investor Agent (in the case of a release or announcement by the Company) (which
consents shall not be unreasonably withheld), except as such release or
announcement may be required by law or the applicable rules or regulations of
any securities exchange or securities market, in which case the Company or the
Investors, as the case may be, shall allow the Investors or the Company, as
applicable, to the extent reasonably practicable in the circumstances,
reasonable time to comment on such release or announcement in advance of such
issuance.

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

       

    

    10.9           Severability.  Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof but shall be interpreted as if it were written so as to be
enforceable to the maximum extent permitted by applicable law, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereby waive any provision of law which
renders any provision hereof prohibited or unenforceable in any
respect.

     

    10.10           Entire
Agreement.  This Agreement, including the Exhibits and the
Disclosure Schedules, and the other Transaction Documents constitute the entire
agreement among the parties hereof with respect to the subject matter hereof and
thereof and supersede all prior agreements and understandings, both oral and
written, between the parties with respect to the subject matter hereof and
thereof.

     

    10.11           Further
Assurances.  The parties shall execute and deliver all such
further instruments and documents and take all such other actions as may
reasonably be required to carry out the transactions contemplated hereby and to
evidence the fulfillment of the agreements herein contained.

     

    10.12           Governing Law; Consent to
Jurisdiction; Waiver of Jury Trial.  This Agreement shall be
governed by, and construed in accordance with, the internal laws of the State of
Delaware without regard to the choice of law principles thereof.

     

    10.13           Independent Nature of
Investors’ Obligations and Rights. The obligations of each Investor under
any Transaction Document are several and not joint with the obligations of any
other Investor, and no Investor shall be responsible in any way for the
performance of the obligations of any other Investor under any Transaction
Document. The decision of each Investor to purchase Securities pursuant to the
Transaction Documents has been made by such Investor independently of any other
Investor. Nothing contained herein or in any Transaction Document, and no action
taken by any Investor pursuant thereto, shall be deemed to constitute the
Investors as a partnership, an association, a joint venture or any other kind of
entity, or create a presumption that the Investors are in any way acting in
concert or as a group with respect to such obligations or the transactions
contemplated by the Transaction Documents. Each Investor acknowledges that no
other Investor has acted as agent for such Investor in connection with making
its investment hereunder and that no Investor will be acting as agent of such
Investor in connection with monitoring its investment in the Securities or
enforcing its rights under the Transaction Documents. Each Investor shall be
entitled to independently protect and enforce its rights, including, without
limitation, the rights arising out of this Agreement or out of the other
Transaction Documents, and it shall not be necessary for any other Investor to
be joined as an additional party in any proceeding for such purpose. The Company
acknowledges that each of the Investors has been provided with the same
Transaction Documents for the purpose of closing a transaction with multiple
Investors and not because it was required or requested to do so by any
Investor.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

       

    

    10.14           No Third-Party
Beneficiaries.  This
Agreement is intended for the benefit of the parties hereto and their respective
successors and permitted assigns and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person.

     

    10.15           Rescission and Withdrawal
Right.  Notwithstanding
anything to the contrary contained in (and without limiting any similar
provisions of) the Transaction Documents, whenever any Investor exercises a
right, election, demand or option under a Transaction Document and the Company
does not timely perform its related obligations within the periods therein
provided, then, prior to such time as the Company timely performs such related
obligation, such Investor may rescind or withdraw, in its sole discretion from
time to time upon written notice to the Company, any relevant notice, demand or
election in whole or in part without prejudice to its future actions and
rights.

     

    10.16           Replacement of
Securities.  If
any certificate or instrument evidencing any Securities is mutilated, lost,
stolen or destroyed, the Company shall issue or cause to be issued in exchange
and substitution for and upon cancellation thereof, or in lieu of and
substitution therefor, a new certificate or instrument, but only upon receipt of
evidence reasonably satisfactory to the Company of such loss, theft or
destruction and customary and reasonable indemnity, if requested.  The
applicants for a new certificate or instrument under such circumstances shall
also pay any reasonable third-party costs associated with the issuance of such
replacement Securities.  If a replacement certificate or instrument
evidencing any Securities is requested due to a mutilation thereof, the Company
may require delivery of such mutilated certificate or instrument as a condition
precedent to any issuance of a replacement.

     

    10.17           Remedies.  In
addition to being entitled to exercise all rights provided herein or granted by
law, including recovery of damages, each of the Investors and the Company will
be entitled to specific performance under the Transaction
Documents.  The parties agree that monetary damages may not be
adequate compensation for any loss incurred by reason of any breach of
obligations described in the foregoing sentence and hereby agrees to waive in
any action for specific performance of any such obligation the defense that a
remedy at law would be adequate.

     

    10.18           Payment Set
Aside.  To
the extent that the Company makes a payment or payments to any Investor pursuant
to any Transaction Document or an Investor enforces or exercises its rights
thereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Company, a trustee,
receiver or any other person under any law (including, without limitation, any
bankruptcy law, state or federal law, common law or equitable cause of action),
then to the extent of any such restoration the obligation or part thereof
originally intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been made or such enforcement or setoff
had not occurred.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

       

    

    10.19           Limitation of
Liability.  Notwithstanding
anything herein to the contrary, the Company acknowledges and agrees that the
liability of an Investor arising directly or indirectly, under any Transaction
Document of any and every nature whatsoever shall be satisfied solely out of the
assets of such Investor, and that no trustee, officer, other investment vehicle
or any other Affiliate of such Investor or any investor, shareholder or holder
of shares of beneficial interest of such an Investor shall be personally liable
for any liabilities of such Investor.

     

    [signature
page follows]

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

       

    

    IN
WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement or
caused their duly authorized officers to execute this Agreement as of the date
first above written.

     

    
      
        	 	
                FIRST
      BLUSH BRANDS, INC.

              	 
	 	 	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ Anthony
      G. Roth	 
	 	 	Name:
      Anthony G. Roth	 
	 	 	Title:
      President and CEO	 
	 	 	 	 

      

    

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    SECURITIES PURCHASE
AGREEMENT

     

    COUNTERPART SIGNATURE
PAGE

     

    By
signing below, the undersigned agrees to the terms of the Securities Purchase
Agreement and to purchase the number of Units set forth below.

     

    
      	
              Number
      of Units: ______________________

               

              Aggregate
      Purchase Price: _______________

            	
              INVESTOR:

              _______________________________

               

               

              By:_________________________________

              Name:

              Title:

               

              Address:____________________________

                           
      ____________________________

               

               

              Facsimile:____________________________

              E-mail:
      ______________________________

               

              With
      a copy to:

            

    

    

    
      	
              Please
      complete the following:

            
	 
      	 
      	 
      
	
              1.

            	
              The
      exact name that your Shares and Warrants are to be registered in (this is
      the name that will appear on any Share and Warrant certificates). You may
      use a nominee name if appropriate:

            	 
      
	 
      	 
      	 
      
	
              2.

            	
              The
      relationship between the Investors of the Shares and Warrants and the
      Registered Holder listed in response to item 1 above:

            	 
      
	 
      	 
      	 
      
	
              3.

            	
              The
      mailing address and facsimile number of the Registered Holder listed in
      response to item 1 above (if different from above):

            	
               

              _______________________________

              _______________________________

              Facsimile:
       ___________________________

              E-mail: ______________________________

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00175-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00175-of-00352.parquet"}]]