Document:

erf_8k-ex1001.htm

    Exhibit
10.1

    

     

    ASSET PURCHASE
AGREEMENT

     

    THIS ASSET PURCHASE AGREEMENT
(the “Agreement”), made and entered into as of this 1st day of June, 2009, by
and between ERF Wireless, Inc., a Nevada corporation (“Parent”), and ERF
Wireless Bundled Services, Inc., a Texas corporation and wholly-owned subsidiary
of Parent, (“Subsidiary”) (Parent and Subsidiary hereinafter collectively
referred to and jointly and severally liable as “Buyer”), and  Ronnie
D. Franklin , the sole proprietor of iTexas.net headquartered in Granbury, Texas
(“Seller”).

     

    W
I T N E S S E T H:

     

    WHEREAS, Seller presently
operates a business engaged in providing a comprehensive full range of internet
services including internet access, dial-in,  and wireless solutions
to commercial businesses and residential customers (the “Business”);
and

     

    

    WHEREAS, Seller desires to
sell substantially all of the assets and contracts of the Business to Buyer, and
Buyer desires to purchase such assets and contracts from Seller, on the terms
and subject to the conditions set forth herein.

     

    NOW, THEREFORE, Buyer and
Seller, in consideration of the mutual promises hereinafter set forth, do hereby
promise, and agree as follows:

     

    ARTICLE ONE: ASSETS TO BE
PURCHASED

     

    
      	
              1.1  

            	
              Purchased
      Assets.  Upon the terms and subject to the conditions set
      forth in this Agreement, Seller hereby agrees to sell to Subsidiary and
      Subsidiary hereby agrees to purchase from Seller, at the Closing, all of
      Seller's right, title, and interest in substantially all of the assets
      associated with the Business, including the following (collectively, the
      “Purchased Assets”):

            

    

    

    The
assets being acquired include the rights, title, and interest in substantially
all of the assets associated with the Business, including:

     

    
      	
              a)  

            	
              All
      wireless and dial-up network infrastructure equipment, including
      subscriber units, access nodes, backhaul links, radios, antennas,
      switches, routers and servers with related
  software;

            

    

    
      	
              b)  

            	
              the
      96 foot Trylon tower located at 3211 Fall Creek Highway, Acton,
      Texas;

            

    

    
      	
              c)  

            	
              all
      inventory, equipment, goods, documents pertaining to the operations and
      instruments of the Business;

            

    

    
      	
              d)  

            	
              all
      rights to equipment, tower and facilities space leases for the Business
      (“Assumed Leases”);

            

    

    
      	
              e)  

            	
              assignment
      of Seller’s 3.65 WiMAX license rights on the main tower located at Hwy 51
      South at 3439 Peak Road, Granbury,
TX.

            

    

    
      	
              f)  

            	
              all
      transferable customer and contractual rights held by the Business,
      including all ISP Subscriber Agreements, all Design Agreements, Equipment
      Purchase Agreements, Internet Access and Monitoring and Maintenance
      Agreements with customers with fixed wireless
  broadband;

            

    

    
      	
              g)  

            	
              all
      general intangibles (including trademarks, trade names and symbols) used
      in connection with iTexas.net;

            

    

    
      	
              h)  

            	
              all
      work in progress, and all other contracts and agreements relating to the
      Business;

            

    

    
      	
              i)  

            	
              all
      transferable equipment and software related to the Business, (except as
      specifically agreed and set forth otherwise as “excluded equipment” in the
      Definitive Agreement;

            

    

    
      	
              j)  

            	
              all
      legally assignable government permits, licenses and certifications for the
      Business ("Governmental Permits");
and

            

    

    
      	
              k)  

            	
              all
      documents, files and records containing technical support, all additions,
      accessions and substitutions thereto and other information pertaining to
      the Business in Seller’s possession or
control.

            

    

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    
 

     

    
      	
              l)  

            	
              Seller
      will be permitted to retain title to certain equipment set forth on the
      Asset
      Listing.pdf document that is specifically designated as “Retained
      by Ronnie”.  Notwithstanding, Buyer shall be permitted to retain
      and have unfettered use this equipment for a minimum of 90 days until
      appropriate transition of customers can be accomplished and will be
      allowed a one-time 30 extension to accomplish this
      transition.  Specifically, this designation will only apply to
      the following equipment:

            

    

    
      	
              i.  

            	
              Compaq
      Server - Modus Mail Server

            

    

    
      	
              ii.  

            	
              Compaq
      Drive - Array Drive chassis and
drives

            

    

    
      	
              iii.  

            	
              Modus
      Mail - Modus Mail Server License - Unlimited
  Users

            

    

    
      	
              iv.  

            	
              Compaq
      Server - Emerald Server

            

    

    
      	
              v.  

            	
              Compaq
      Drive -  Array Drive chassis and
  drives

            

    

    
      	
              vi.  

            	
              Emerald
      ISP Customer System - Emerald License for 3000
  MBRs

            

    

    

     

    Seller
will provide to Buyer copies of the following books, records, manuals and other
materials in any tangible form to the extent such books, records, manuals and
other materials relate to the Business and/or the Purchased Assets: (i) records
relating to customers that are parties to any contracts, (ii) records relating
to vendors, and (iii) all other books, records, files, correspondence, documents
and information owned by Seller relating to the Business that are currently in
the possession of the Seller, however maintained or stored (collectively, the
“Records”), it being understood that the Seller may delete confidential
information that does not relate to the Purchased Assets or the
Business.

     

    
      1.2  Excluded
Assets.  The Purchased Assets shall not include the following
(herein referred to as the “Excluded Assets”):

    

     

    
      	
               
      

            	
              a.

            	
              all
      corporate minute books, stock transfer books and other documents relating
      to the organization, maintenance and existence of Seller as a limited
      liability company;

            

    

     

    
      	
               
      

            	
              b.

            	
              all
      rights of Seller pursuant to this Agreement, including the consideration
      paid to Seller pursuant to this
Agreement;

            

    

     

    
      	
               
      

            	
              c.

            	
              all
      originals of personnel records, if any, and other records that Seller is
      required by applicable law to retain in its
  possession;

            

    

     

    
      	
            	
              d. 

            	
              all
      tax refunds which are due to
Seller;

            

    

     

    
      	
               
      

            	
              e.

            	
              all
      membership interests in Seller; and

            

    

     

    
      	
            	
              f. 

            	
              any
      other item specifically listed inSchedule
      1.2.

            

    

     

    

    1.3 Purchase
Price; Payment of Purchase Price.  In addition to the Assumed
Liabilities described below, the aggregate consideration for the Purchased
Assets (the “Purchase Price”) shall be the amount equal to
$165,000.

     

    

    1.4 Payment
Terms.  The Purchase Price shall be payable by Buyer to Seller
on the Closing Date as follows:

     

    
      	
              a.  

            	
              $16,500 cash as set forth
      in definitive agreement

            

    

    
      	
              b.  

            	
              $66,000 payable by a
      Secured Convertible Promissory Note in the form attached hereto as Exhibit 1.4(b)
      (the “Promissory Note or Note”).

            

    

    
      	
              c.  

            	
              $82,500 to be paid by issuance
      of Rule 144 Restricted Stock priced at trailing 10 day average
      prior to closing. Buyer agrees to make up any shortfall in Freely Tradable
      common stock if the aggregate value of all shares issued are sold in open
      market transactions and total less than $82,500 unless the shortfall
      expires according the following provisions.  The shortfall
      guarantee shall expire on the earlier of (a) the liquidation of $82,500 in
      value or (c) 18 months following the
closing.

            

    

    Seller
and Seller’s secured lender, First National Bank of Granbury (“Bank”), agree to
release respective UCC-1 liens within 10 business days of the full repayment of
the $66,000 Secured Note and receipt of $82,500 in cash from the sale of the
Restricted Stock.  In the event that the Seller’s monthly note
obligations to the Bank are not satisfied in accordance with the applicable
terms set forth in Seller’s note with the Bank and the Bank forecloses on the
assets of the Business, Buyer reserves the right to settle such foreclosure
action with the Bank and discontinue all future obligations against this
agreement.  In the event that the Buyer is required to settle such
foreclosure actions, the Seller and Seller’s Bank agree to release all UCC-1
liens within 10 business days of such settlement action.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    For
purposes of this Agreement, “Rule 144 Restricted Stock” shall mean shares of the
common stock, par value $.001, of Parent (the “Common Stock”) the issuance of
which to Seller has not been registered under the Securities Act of 1933, as
amended (the “Securities Act”) and that are considered “restricted securities”
as defined in Section 144 of the Securities Act.

     

    For
purposes of this Agreement, “Freely Tradable Common Stock” shall refer to Common
Stock of Parent the issuance of which to Seller has been registered under the
Securities Act, and that has not subject to any contractual, regulatory or other
legal restrictions on transfer, is free and clear of all liens and encumbrances,
and is freely tradable to members of the general public.

     

    1.5 Assumed
Liabilities; No Other Assumption of Liabilities.  As partial
consideration for the Purchased Assets, Buyer shall assume and agree to pay,
perform and discharge only those liabilities and obligations of Seller (the
“Assumed Liabilities”):

     

    
      	
              a.  

            	
              arising
      in connection with the operation of the Business by the Purchaser after
      the closing date; and

            

    

    
      	
              b.  

            	
              arising
      after the closing date in connection with the performance by the Purchaser
      of the contracts and agreements associated with the Business assigned to
      Purchaser, including; ISP Subscriber Agreements, tower leases, telecomm
      and wholesale dial-up provider costs in effect pertaining to the
      Business.

            

    

    

     

    The
Assumed Liabilities shall expressly exclude (i) any accrued payroll and payroll
taxes, if any, (ii) any unpaid obligations of Seller to Frontier Internet, LLC
for services rendered or product purchases prior to closing, (iii) all vendor
obligations arising prior to closing, (iv) any accounts payable obligations for
goods and services delivered or rendered prior to the Closing Date, (v) any
liabilities or obligations related to the Assigned Leases or Assigned Contracts
that arise from breach of contract, default or other such tortious claim
occurring prior to Closing, (collectively, the “Specified Retained
Liabilities”).  The Specified Retained Liabilities shall either be
retained by Seller after Closing or fully paid by Seller prior to
Closing.

     

    Except
for the Assumed Liabilities, Buyer shall not assume or be obligated under, or
become liable for, any debt, liability, contract or obligation whatsoever of
Seller or the Business, and Seller shall be responsible for the payment or
performance and full discharge of all debts, liabilities, contracts and
obligations whatsoever of Seller, including those related to the Business, that
arise prior to the Closing and the Specified Retained Liabilities.  In
particular (and by way only of example and not by way of limitation), Seller
shall be and remain solely responsible for, and shall timely pay or perform and
discharge, all debts, liabilities, contracts and obligations with respect to the
Business other than the Assumed Liabilities, including (i) the Specified
Retained Liabilities, (ii) any tax liability or obligation arising in connection
with transactions occurring prior to the Closing, but excluding any sales, use,
transfer or other tax obligation arising out of or in connection with the
transactions contemplated by this Agreement or the performance, use or operation
of the Purchased Assets by Buyer, which Buyer hereby agrees to be responsible
for; (and (iv) any legal claim or any other liability or obligation whatsoever
incurred by Seller relating to the Business for periods or occurrences prior to
and including the Closing Date.

     

    1.6  Allocation
of Purchase Price.  The Purchase Price shall be allocated for
federal income tax purposes in accordance with Schedule 1.6, (to be
completed as a post-Closing schedule).  The parties shall make
consistent use of the allocation specified on Schedule 1.6 for
all federal income tax purposes and in all filings, declarations and reports
with the Internal Revenue Service (the “IRS”) in respect thereof, including the
reports required to be filed under Section 1060 of the Internal Revenue
Code, as amended (the “Code”).  Each of the parties will file all tax
returns and information reports, including the IRS Form 8594 and any disclosures
that are required under Section 1060 of the Code, in a manner consistent with
the allocation specified in Schedule
1.6.  In any Proceeding (hereinafter defined) related to the
determination of any tax, neither Buyer nor Seller shall contend or represent
that such allocation is not a correct allocation.

     

    ARTICLE TWO:
CLOSING

     

    2.1  Time and
Place of Closing; Closing Deliveries. The closing of the purchase and
sale contemplated herein (the “Closing”) shall take place at 3:00 p.m., on June
01, 2009 at the offices of Parent, located in League City, Texas. The date of
Closing is hereinafter referred to as the “Closing Date.”

     

    At the
Closing, Buyer shall deliver to Seller according to Seller’s
instructions:

     

    
      	
              a.  

            	
              the
      Cash Amount by wire transfer or certified bank
  check;

            

    

     

    
      	
              b.  

            	
              certificates
      representing a number of shares of Rule 144 Restricted Stock of the
      Parent, as determined in accordance with Section 1.4
      (the “Stock Certificates”), or evidence satisfactory to Seller that Buyer
      has instructed its transfer agent to prepare and deliver such Stock
      Certificates and that such Stock Certificates will be delivered to Seller
      no later than five (5) days following
Closing;

            

    

     

    
      	
              c.  

            	
              the
      executed Promissory Note; ;

            

    

     

    
      	
              d.  

            	
              the
      executed Security Agreement, the form of which is attached hereto as Exhibit 2.1(d)
      (the “Security Agreement”); and

            

    

     

    
      	
              e.  

            	
              the
      documents, certificates, agreements and instruments described below in
      Section
      2.3.

            

    

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    2.2  Conditions
Precedent to Buyer's Obligation. The obligation of Buyer to consummate
the transactions contemplated herein is subject to the satisfaction (or, in
Buyer's sole discretion, written waiver thereof) of the following conditions as
of the Closing:

     

    
      	
               
      

            	
              a.

            	
              The
      representations and warranties of Seller made in this Agreement shall be
      true and correct in all material respects at
  Closing;

            

    

     

    
      	
               
      

            	
              b.

            	
              No
      demand, action, suit, audit, investigation, review, claim or other legal
      or administrative proceeding (collectively, a “Proceeding”) by any nation
      or government, any state or other political subdivision thereof, including
      any governmental agency, department, commission, or instrumentality of the
      United States, any State of the United States or any political subdivision
      thereof or, any self-regulatory agency or authority (collectively,
      “Governmental Authority”) or other person shall have been instituted or
      threatened against Seller which seeks to enjoin, restrain or prohibit, or
      which questions the validity or legality of, the transactions contemplated
      hereby or which otherwise seeks to affect or could reasonably be expected
      to affect the transactions contemplated
hereby;

            

    

     

    
      	
               
      

            	
              c.

            	
              Seller
      shall have approved this Agreement and the transactions contemplated
      hereby;

            

    

     

    
      	
               
      

            	
              d.

            	
              Seller
      shall have performed in all material respects its obligations described in
      Section
      5.1;

            

    

     

    
      	
               
      

            	
              e.

            	
              Seller
      shall enter into a sales lead referral agreement with the Buyer upon terms
      to be mutually agreed for introductions to prospective new wireless ISP
      customers on a post-closing basis.

            

    

     

    
      	
               
      

            	
              f.

            	
              Buyer
      shall have received from Seller all of the
  following:

            

    

     

    (i) A
duly executed bill of sale, the form of which is attached hereto as Exhibit 2.2(e)(i)
(the “Bill of Sale”), which includes a complete list of the Assigned Tangible
Assets, conveying to Buyer the Assigned Tangible Assets free and clear of all
pledges, security interests, or other similar liens granted by Seller and free
and clear of all other adverse claims of any kind whatsoever known by Seller
(collectively, “Encumbrances”), except (A) Encumbrances for taxes, the payment
of which are not delinquent, (B) materialmen's, warehousemen's, mechanic's,
lender’s, lessor’s, or other Encumbrances arising by operation of law in the
ordinary course of business for sums not due and which do not materially detract
from the value of such assets or properties or materially impair the operation
of the Business, and (C) statutory Encumbrances incurred in the ordinary course
of business in connection with worker's compensation, unemployment insurance or
other forms of governmental insurance or benefits (collectively “Permitted
Encumbrances”);

     

    (ii) A
duly executed assignment and assumption agreement, the form of which is attached
hereto as Exhibit
2.2(f)(ii) (the “Assignment and Assumption Agreement”), which includes a
complete list of all Assigned Leases, Assigned Contracts and Governmental
Permits;

     

    (iii)
Duly executed trademark, copyright and other intellectual property assignment
documents, as reasonably requested by Buyer to fully effectuate the use by or
transfer to Buyer of the intellectual property;

     

    (iv)
Actual or constructive physical possession of the Purchased Assets and the
Records;

     

    (v) An
executed certificate of amendment to Seller’s Certificate of Formation effecting
a change in Seller’s name (the “Amendment”); and

     

    (vi) A
certificate of the managers of Seller certifying, as complete and accurate as of
the Closing (A) copies of the governing documents of Seller, (B) all requisite
resolutions or actions of Seller's managers and members approving the execution
and delivery of this Agreement and the consummation of the contemplated
transactions, and (C) the incumbency and signatures of the managers of Seller
executing this Agreement and any other document relating to the contemplated
transactions.

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    2.3  Conditions
Precedent to Seller's Obligations. The obligation of Seller to consummate
the transactions contemplated herein is subject to the satisfaction (or, in
Seller’s sole discretion, written waiver thereof) of the following conditions as
of the Closing:

     

    
      	
               
      

            	
              a.

            	
              The
      representations and warranties of Buyer made in this Agreement shall be
      true and correct in all material respects at
  Closing;

            

    

     

    
      	
               
      

            	
              b.

            	
              No
      Proceeding by any Governmental Authority or other person shall have been
      instituted or threatened against Buyer which seeks to enjoin, restrain or
      prohibit, or which questions the validity or legality of, the transactions
      contemplated hereby or which otherwise seeks to affect or could reasonably
      be expected to affect the transactions contemplated
  hereby;

            

    

     

    
      	
               
      

            	
              c.

            	
              Buyer’s
      operations have been in compliance with all applicable Laws and
      regulations that could have a material adverse impact on the
      Business;

            

    

     

    
      	
               
      

            	
              d.

            	
              Buyer
      shall have performed in all material respects its obligations described in
      Section
      5.1 and elsewhere in this
Agreement;

            

    

     

    
      	
               
      

            	
              e.

            	
              Seller
      shall have received from Buyer all of the
  following:

            

    

     

    (i) The
Purchase Price (including the duly executed Promissory Note, Security Agreement,
and the stock certificates representing the shares of Rule 144 Restricted Stock
as described in Section
1.4(d));

     

    (ii) The
Assignment and Assumption Agreement, duly executed by Subsidiary;
and

     

    (iii) A
certificate of the Secretary of each of Parent and Subsidiary certifying, as
complete and accurate as of the Closing (A) attached copies of the governing
documents of each of Parent and Subsidiary, as amended and restated, as
applicable, (B) all requisite resolutions or actions of each of Parent’s and
Subsidiary’s board of directors approving the execution and delivery of this
Agreement and the consummation of the contemplated transactions, and (C) the
incumbency and signatures of the officers of each of Parent and Subsidiary
executing this Agreement and any other document relating to the contemplated
transactions.

     

    2.4 Consents
and Other Conditions to Closing.  It shall also be a condition
precedent to closing that:

     

    
      	
              a.  

            	
              Buyer
      and Seller shall have obtained all necessary written consents or approvals
      from all governmental or regulatory authorities that are necessary to
      acquire the Purchased Assets and for Subsidiary to continue the historical
      operations of the Seller;

            

    

     

    
      	
              b.  

            	
              Seller
      shall not be involved in or threatened with any litigation that would have
      a material adverse effect on the Purchased Assets;
  and

            

    

     

    
      	
              c.  

            	
              Seller
      shall have obtained all necessary consents from any utility companies,
      governmental or regulatory authorities, landlords, lenders, suppliers and
      other third parties in connection with the material contracts described in
      Schedule
      2.4 (the “Material Contracts”) to be assumed by Subsidiary at
      Closing (the “Material Consents”).  If Seller is unable to
      obtain any Material Consents as of the Closing Date (each such Material
      Contract for which a Material Consent was not obtained as of the Closing
      Date shall be referred to as a “Restricted Material Contract”), Buyer may
      waive the closing conditions as to any such Material Consent and
      either:

            

    

     

    (i) elect
to have Seller continue its efforts to obtain the Material Consents;
or

     

    (ii)
elect to have Seller retain such Restricted Material Contract and all
liabilities arising therefrom or relating thereto.

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    If Buyer
elects to have Seller continue its efforts to obtain any Material Consents and
the Closing occurs, notwithstanding Sections 1.1 and 1.5
to the contrary, neither this Agreement nor the Assignment and Assumption
Agreement nor any other document related to the consummation of the transactions
contemplated in this Agreement shall constitute a sale, assignment, assumption,
transfer, conveyance, delivery, or an attempted sale, assignment, assumption,
transfer, conveyance or delivery of the Restricted Material Contracts. Following
the Closing, the parties shall use their Best Efforts (hereinafter defined)
(other than that Seller and Buyer shall have no obligation to offer or pay any
consideration in order to obtain any such Material Consents) and cooperate with
each other to obtain the Material Consents relating to the Restricted Material
Contracts as quickly as practicable.  Pending the obtainment of such
Material Consents relating to the Restricted Material Contracts, the parties
shall cooperate with each other in any reasonable and lawful arrangements
designed to provide to Buyer the benefits of use of each Restricted Material
Contract for the term of such agreement (or any right or benefit arising
thereunder, including the enforcement for the benefit of Buyer of any and all
rights of Seller against a third party thereunder).  Once a Material
Consent for the sale, assignment, assumption, transfer, conveyance and delivery
of a Restricted Material Contract is obtained, Seller shall promptly assign,
transfer, convey and deliver such Restricted Material Contract to Buyer, and
Buyer shall assume the obligations under such Restricted Material Contract
assigned to Buyer from and after the date of assignment to Buyer pursuant to a
special-purpose assignment and assumption agreement substantially similar in
terms to those of the Assignment and Assumption Agreement (which special-purpose
agreement the parties shall prepare, execute and deliver in good faith at the
time of such transfer, all at no additional cost to Buyer).

     

    If there
are any consents not listed on Schedule 2.4
that are necessary for the assignment and transfer of any Seller contracts to
Buyer (the “Nonmaterial Consents”) which have not yet been obtained (or
otherwise are not in full force and effect) as of the Closing Date, Buyer shall
elect at the Closing, in the case of each Seller contract for which a
Nonmaterial Consents was not obtained (or otherwise are not in full force and
effect) as of the Closing Date (the “Restricted Nonmaterial
Contracts”), whether to:

     

    (i)
accept the assignment of such Restricted Nonmaterial Contract, in such case, as
between Buyer and Seller, such Restricted Nonmaterial Contract shall, to the
maximum extent practicable and notwithstanding the failure to obtain the
applicable Nonmaterial Consent, be transferred at the Closing pursuant to the
Assignment and Assumption Agreement or as elsewhere provided under this
Agreement; or

     

    
      	
               
      

            	
              (ii)
      reject the assignment of such Restricted Nonmaterial Contracts, in which
      case, notwithstanding Sections 1.1 and
      1.5, (A) neither this Agreement nor the Assignment and Assumption
      Agreement nor any other document related to the consummation of the
      transactions contemplated by this Agreement shall constitute a sale,
      assignment, assumption, conveyance or delivery or an attempted sale,
      assignment, assumption, transfer, conveyance or delivery of such
      Restricted Nonmaterial Contract, and (B) Seller shall retain such
      Restricted Nonmaterial Contract and all liabilities arising therefrom or
      relating thereto.

            

    

     

    “Best
Efforts” means the efforts that a prudent person desirous of achieving a result
would use in similar circumstances to achieve that result as expeditiously as
possible, provided, however, that a person required to use Best Efforts under
this Agreement will not be required to take actions that would result in a
material adverse change in the benefits to such person of this Agreement and the
contemplated transactions, or to dispose of or make any change to its business,
expend any material funds or incur any other material burden.

     

    2.5 Failure
of Conditions.  If any of the material conditions to Closing
set forth in Sections
2.2, 2.3 and 2.4 have not been satisfied, the party or parties entitled
to the benefit of such material conditions may elect to (i) waive such
conditions, (ii) terminate this Agreement without further liability of the
terminating party, or (iii) to consummate the transactions contemplated
hereby.

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    ARTICLE THREE: WARRANTIES
AND REPRESENTATIONS OF SELLER

     

    Seller
hereby warrants and represents to Buyer, which warranties and representations
shall survive the Closing for one year, as follows:

     

    3.1  Corporate
Matters; No Conflict.  Seller is a limited liability company
duly formed, validly existing and in good standing under the Laws of the State
of Texas and has the authority and power, corporate and otherwise, to carry on
the Business in the places and in the manner presently conducted. Seller has the
corporate power and authority to enter into this Agreement and all other
agreements and documents to be executed and delivered pursuant to this Agreement
(the “Ancillary Agreements”) by Seller and to consummate the transactions
contemplated hereby.

     

    The
execution, delivery and performance of this Agreement, the Ancillary Agreements
to be executed by Seller, and the consummation of the transactions contemplated
hereby have been approved by all necessary corporate action of Seller. This
Agreement and the Ancillary Agreements to be executed by Seller constitute, or,
in the case of such Ancillary Agreements that are not executed as of Closing,
upon the execution and delivery of such agreements by Seller, will constitute,
valid and legally binding obligations of Seller, enforceable against it in
accordance with the respective terms of such agreements, except as such
enforceability may be limited by bankruptcy and other Laws generally affecting
the rights of creditors, and general principles of equity.

     

    To the
knowledge of Seller, there are no material adverse environmental liabilities
associated with the Business or the Purchased Assets.

     

    To the
knowledge of Seller, except as set forth in Schedule 3.1, the
execution, delivery and performance of this Agreement and such Ancillary
Agreements to be executed by Seller, and the consummation of the transactions
contemplated hereby: (i) do not and will not violate, conflict with, or result
in the breach of, or default under any term, condition or provision of, give
rise to any right to terminate, cancel, modify, accelerate or otherwise change
the existing rights or obligations of such party with respect to, (A) any
domestic or foreign federal, state or local statute, law, ordinance, rule,
administrative interpretation, regulation, policy, guideline or other
requirement of or by any Governmental Authority, each as amended through the
date hereof (collectively, “Laws”) which are applicable to the Seller, the
Business and/or the Purchased Assets, (B) any judgment, order, writ, injunction,
decree, directive or award of any arbitrator or Governmental Authority
(collectively, an “Order”) which is applicable to the Seller, the Business
and/or the Purchased Assets, (C) the charter documents of Seller or any
securities issued by Seller, or (D) any authorization, approval, consent,
qualification, permit or license (collectively, an “Authorization”) of any
Governmental Authority, any material agreement, or other material instrument,
document or understanding, oral or written, to which the Seller is a party, by
which Seller may have rights or by which any of the Purchased Assets may be
bound or affected; or (ii) result in the creation or imposition of any
Encumbrance, excluding Permitted Encumbrances, on the Purchased
Assets.

     

    No
Authorization or other action of, or registration, declaration, recording or
filing with, any Governmental Authority or other person (other than the approval
of the managers and members of Seller) is required in connection with (i) the
execution and delivery of this Agreement and any Ancillary Agreements to be
executed and delivered pursuant this Agreement by Seller and/or (ii) the
consummation by Seller of the transactions contemplated hereby.

     

    3.2  Title to
the Purchased Assets.  Seller has good and valid title to all
of the assets constituting the Purchased Assets described in Section 1.1, free and
clear of all Encumbrances, excluding the Permitted Encumbrances.

     

    3.3  Commitments;
Customers and Vendors. To the knowledge of
Seller, the Material Contracts listed on Schedule 2.4 are all
of the material agreements, arrangements, and other commitments of the Business
with its customers (whether written, oral or otherwise), which if not assigned
to or assumed by Buyer as an “Assigned Contract” hereunder, would result in
liabilities or obligations of Seller accruing after the Closing. True and
correct copies of each of the Material Contracts and all amendments and
modifications thereof, have been delivered to Buyer. Assuming that the consents
of the parties to the Material Contracts, all of the Material Contracts are
assignable by Seller.

     

    3.4  Each
Assigned Contract is in full force and effect.  To the
knowledge of Seller, Seller has not been made aware of any facts that would
suggest that any of the Material Contracts within Purchased Assets are not
valid, binding and enforceable in accordance with their terms, except as such
enforceability may be limited by bankruptcy and other Laws generally affecting
the rights of creditors, and general principles of equity. Except as set forth
in Schedule
3.4, neither Seller nor, to the knowledge of Seller, any other party to
an Assigned Contract is in breach or default under any such contract (with or
without the lapse of time, or the giving of notice, or both).

     

    3.5  Brokers,
Agents. Seller has not dealt with any agent, finder, broker or other
representative (other than representatives of Buyer) in any manner which could
result in Buyer being liable for any finder's, broker's or other fees or
commissions in connection with the subject matter of this
Agreement.

     

    3.6  Warranties
True and Correct. No representation or warranty by Seller contained in
this Agreement or in any writing to be furnished pursuant hereto contains or
will contain any untrue statement of fact or omits or will omit to state any
material fact required to make the statements herein or therein complete and not
misleading.

     

    3.7  Exclusion
of Implied Warranties.  SELLER EXCLUDES AND DISCLAIMS ANY AND
ALL IMPLIED WARRANTIES, INCLUDING WITHOUT LIMITATION, WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THE
PURCHASED ASSETS AND EACH OF THEM.  NOTWITHSTANDING ANYTHING TO THE
CONTRARY HEREIN, SELLER MAKES NO WARRANTIES TO BUYER IN CONNECTION WITH THE SALE
OR TRANSFER OF THE PURCHASED ASSETS TO SUBSIDIARY OR THE CONDITION OR PROSPECTS
OF THE BUSINESS OTHER THAN THOSE EXPRESSLY SET FORTH IN THIS ARTICLE
THREE.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    ARTICLE FOUR: WARRANTIES AND
REPRESENTATIONS OF BUYER

     

    Each of
Parent and Subsidiary hereby warrants and represents to Seller, which warranties
and representations shall survive the Closing for a period of three (3) years
following Closing as follows:

     

    4.1  Corporate
Matters; No Conflict. Each of Parent and Subsidiary is a corporation duly
organized, validly existing and in good standing under the Laws of the state
where it was incorporated.  Each of Parent and Subsidiary has the
authority and power, corporate or otherwise, to carry on all business activities
in the places and in the manner currently conducted by it.  Each of
Parent and Subsidiary has the corporate power and authority to enter into this
Agreement and the Ancillary Agreements to be executed and delivered by it, and
to consummate the transactions contemplated hereby.  The execution,
delivery, and performance of this Agreement and the Ancillary Agreements by each
of Parent and Subsidiary have been approved by all necessary corporate action.
This Agreement and the Ancillary Agreements to be executed and delivered by each
of Parent and Subsidiary constitute, or in the case of the Ancillary Agreements,
upon their execution and delivery by each of Parent and Subsidiary, as
applicable, will constitute, valid and legally binding obligations of each of
Parent and Subsidiary, enforceable against each in accordance with the
respective terms except as such enforceability may be limited by bankruptcy and
other Laws generally affecting the rights of creditors, and general principles
of equity.

     

    The
execution, delivery and performance of this Agreement and the Ancillary
Agreements to be executed and delivered by each of Parent and Subsidiary, as
applicable, the consummation of the transactions contemplated hereby, and the
compliance herewith: (i) do not, and will not violate, conflict with or result
in the breach of, or default under, any term, condition or provision of, give
rise to any right to terminate, cancel, modify, accelerate or otherwise change
the existing rights or obligations of such party with respect to, (A) any Laws
which are applicable to each of Parent and Subsidiary, the Business and/or the
Purchased Assets, (B) any Order which is applicable to each of Parent and
Subsidiary, the Business and/or the Purchased Assets, (C) the charter documents
of each of Parent and Subsidiary or any securities issued by Parent or
Subsidiary, or (D) Authorization of any Governmental Authority, or any material
agreement, or other material instrument, document or understanding, oral or
written, to which Parent or Subsidiary is a party, by which Parent or Subsidiary
may have rights or by which any of the Purchased Assets may be bound or
affected.

     

    No
Authorization or other action of, or registration, declaration, recording or
filing with, any Governmental Authority or other person is required in
connection with the execution and delivery of this Agreement and/or any
Ancillary Agreement to be executed and delivered pursuant hereto by each of
Parent and Subsidiary, as applicable, and/or the consummation by each of Parent
and Subsidiary of the transactions contemplated hereby.

     

    4.2  Capitalization.  All
of the Common Stock of Parent to be issued in connection with the transactions
contemplated by this Agreement, including shares of Parent’s Common Stock to be
issued in connection with (i) Closing, (ii) the Shortfall Guarantee, and (iii)
the Promissory Note, or otherwise, have been duly authorized and will be validly
issued, fully paid, and nonassessable.

     

    4.3  SEC
Filings; Financial Statements.

     

    
      	
              a.  

            	
              The
      Parent has made available to the Seller, upon request of the Seller,
      accurate and complete copies (excluding copies of exhibits) of each
      report, registration statement and definitive proxy statement filed by the
      Parent with the U.S. Securities Exchange Commission (the “SEC”) between
      December 31, 2004 and the date of this Agreement (the “Parent SEC
      Documents”).  As of the time it was filed with the SEC (or, if
      amended or superseded by a filing prior to the date of this Agreement,
      then on the date of such filing):  (i) each of the Parent
      SEC Documents complied in all material respects with the applicable
      requirements of the Securities Act or the Securities Exchange Act of 1934
      (as the case may be); and (ii) none of the Parent SEC Documents
      contained any untrue statement of a material fact or omitted to state a
      material fact required to be stated therein or necessary in order to make
      the statements therein, in the light of the circumstances under which they
      were made, not misleading.

            

    

     

    
      	
              b.  

            	
              Between
      the date of the most recently filed Parent SEC Document and the date of
      this Agreement, there has been no material adverse change in the Parent’s
      affairs that has not been disclosed in the Parent's SEC Documents, provided, however, that
      for purposes of determining whether there shall have been any such
      material adverse change, (i) any adverse change resulting from or relating
      to worldwide general business or economic conditions shall be disregarded,
      (ii) any adverse change resulting from or relating to conditions generally
      affecting the industry in which Parent competes shall be disregarded, and
      (iii) any adverse change to the stock price of the Parent’s Common Stock,
      as quoted on any nationally recognized stock quotation system, shall be
      disregarded. 

            

    

     

    
      	
              c.  

            	
              The
      consolidated financial statements contained in the Parent's SEC
      Documents:  (i) complied as to form in all material
      respects with the published rules and regulations of the SEC applicable
      thereto; (ii) were prepared in accordance with generally accepted
      accounting principles applied on a consistent basis throughout the periods
      covered, except as may be indicated in the notes to such financial
      statements and (in the case of unaudited statements) as permitted by
      Form 10-Q of the SEC, and except that unaudited financial statements
      may not contain footnotes and are subject to year-end audit adjustments;
      and (iii)  fairly present the consolidated financial position of the
      Parent and its subsidiaries as of the respective dates thereof and the
      consolidated results of operations of the Parent and its subsidiaries for
      the periods covered thereby.

            

    

     

    
      	
              d.  

            	
              The
      Parent qualifies as a registrant whose securities may be resold pursuant
      to Form S-1 or SB-2 promulgated by the SEC pursuant to the Securities
      Act.

            

    

     

    
 

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    4.4  Acquisition
Subsidiary. Subsidiary was formed in October 2005, and is principally
engaged in providing internet access to commercial and residential clients.
Immediately following the Closing, Subsidiary will continue to operate as a
wholly owned subsidiary of Parent.

     

    4.5 Brokers;
Agents.  Buyer has not dealt with any agent, finder, broker or
other representative in any manner other than International Business Exchange,
as authorized by Seller, which could result in Seller being liable for any fee
or commission in the nature of a finder's or originator's fee in connection with
the subject matter of this Agreement.

     

    4.6  Warranties
True and Correct.  No warranty or representation by Buyer
contained in this Agreement or in any writing to be furnished pursuant hereto
contains or will contain any untrue statement of fact or omits or will omit to
state any material fact required to make the statements therein contained not
misleading.

     

    ARTICLE FIVE: ADDITIONAL
COVENANTS

     

    5.1  Publicity.  No party will make any
public disclosure or issue any press releases pertaining to the existence of
this Agreement without having first obtained the consent of the other parties,
excluding communications with employees, customers, suppliers, governmental
agencies, and other groups as may be legally required or necessary or
appropriate (i.e., any securities filings or notices), and which are not
inconsistent with the prompt consummation of the transactions contemplated in
this Agreement.  However, Parent is a public company and Seller agrees
that it will not unreasonably withhold consent for Parent to issue a public
press release, provided to Seller in advance, if requested by
Parent.

     

    5.2  Cooperation.
Seller shall cooperate with Buyer and use its Best Efforts to cause its
respective officers, agents, accountants and representatives, if any, to
cooperate with Buyer after the Closing to facilitate the orderly transition of
the Business and the Purchased Assets to Buyer and to minimize any disruption to
the Business that might result from the transactions contemplated
hereby.

     

    5.3  Execution
of Additional Documents. From time to time, as and when requested by
Buyer, Seller shall execute and deliver, or cause to be executed and delivered,
all such documents and instruments of conveyance and shall take, or cause to be
taken, all such further or other actions as are necessary to consummate the
transactions contemplated by this Agreement and to convey, assign, transfer and
deliver to Buyer any of the properties or assets intended to be conveyed,
assigned, transferred and delivered pursuant to this Agreement.

     

    5.4  Records.
For the five (5) year period commencing on the Closing Date, upon reasonable
notice, Buyer and Seller agree to furnish or cause to be furnished, during
normal business hours, to each other and their respective representatives,
employees, counsel and accountants access to such information and assistance
relating to the Business as is reasonably necessary for financial reporting and
accounting matters, the preparation and filing of any returns, reports or forms,
or the defense of any tax claim or assessment, relating to the Business;
provided, however, that such access does not unreasonably disrupt the normal
operations of Buyer or Seller.

     

    ARTICLE SIX: INDEMNIFICATION
& POST CLOSING CONDITIONS

     

    6.1  Indemnification
of Buyer. Seller agrees to indemnify Parent, Subsidiary and their
Affiliates, and their respective members, managers, shareholders, directors,
officers, employees, accountants, attorneys and agents (collectively, the “Buyer
Indemnified Parties”) against, and to hold each such person harmless from, any
and all damages, losses, deficiencies, actions, demands, judgments, diminution
in value, costs and expenses (including reasonable attorneys’ and accountants’
fees) (collectively, “Losses”) of or against such person resulting from (i) any
misrepresentation or breach of warranty on the part of Seller in this Agreement
or in any Ancillary Agreement; (ii) any breach or non-fulfillment of any
agreement or covenant contained herein or in any Ancillary Agreement on the part
of Seller; (iii) any failure of Seller to pay and/or perform any liabilities or
obligations of Seller or the Business (including the Specified Retained
Liabilities and any such liability arising by operation of law) other than the
Assumed Liabilities; and (iv) any claims and liabilities to the extent related
to both (A) Seller's operation of the Business and (B) periods or occurrences
prior to the Closing or, as Seller’s operation of the Business relates to a
Restricted Material Contract, prior to the deferred transfer date, if any,
applicable to such Restricted Material Contract.

     

    For
purposes of this Agreement, “Affiliate” shall mean, as 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.

     

    6.2  Indemnification
of Seller. Parent and Subsidiary jointly and severally agree to indemnify
Seller and its Affiliates and their respective shareholders, directors,
officers, employees, accountants, attorneys and  agents (collectively,
the “Seller Indemnified Parties”) against, and to hold each such person harmless
from, any and all Losses of or against such person resulting from (i) any
misrepresentation or breach of warranty on the part of either Parent or
Subsidiary in this Agreement or in any Ancillary Agreement; (ii) any breach or
non-fulfillment of any agreement or covenant contained herein or in any
Ancillary Agreement on the part of either Parent or Subsidiary; (iii) any
failure by Parent or Subsidiary to pay, discharge and/or perform any of the
Assumed Contracts or the Assumed Liabilities; and (iv) any claims and
liabilities to the extent related to both (A) Parent’s or Subsidiary’s operation
of the Business and (B) periods or occurrences after the Closing or, as Parent’s
or Subsidiary’s operation of the Business relates to a Restricted Material
Contract, after the deferred transfer date if any, applicable to such Restricted
Material Contract.

     

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    6.3  Procedure
Relative to Indemnification. The following procedure shall govern
indemnification:

     

    
      	
               
      

            	
              a.

            	
              If
      either party hereto shall claim that it is entitled to be indemnified
      pursuant to the terms of this Article Six, it (the “Claiming Party”) shall
      so notify Seller in the case of a claim for indemnification hereunder (a
      “Claim”) by any Claiming Party who or which is a Buyer Indemnified Party
      or Buyer in the case of a Claim by a Claiming Party who or which is a
      Seller Indemnified Party (the “Indemnifying Party”) in writing of such
      claim promptly within ninety (90) days after receipt of a notice of such
      claim or notice of any claim of a third party that may reasonably be
      expected to result in a claim by the Claiming Party against the
      Indemnifying Party except that notice shall be given to the Indemnifying
      Party within such earlier period of time as may be reasonably necessary to
      allow the Indemnifying Party to respond to any pleading or other document
      for which a timely response is required; provided, however, that failure
      to timely give such notification shall not affect the indemnification
      provided hereunder except to the extent the Indemnifying Party shall have
      been actually prejudiced as a result of such failure. Such notice shall
      specify the breach of representation, warranty, or agreement claimed by
      the Claiming Party and the Losses incurred by, or imposed upon, the
      Claiming Party on account thereof. If such Losses are liquidated in
      amount, the notice shall so state and such amount shall be deemed the
      amount of the Claim of the Claiming Party. If such Losses are not
      liquidated in amount, the notice shall so state and, in such event, a
      Claim shall be deemed asserted against the Indemnifying Party by the
      Claiming Party, but no payment shall be made on account thereof until the
      amount of such Claim is liquidated and the Claim is finally determined. In
      the case of a Claim other than one which is based upon a Proceeding by any
      third party, including any Proceeding by any Governmental Authority (a
      “Third Party Claim”), if the Indemnifying Party agrees with such Claim for
      indemnification, it shall remit payment for the amount of such Claim
      promptly after receipt from the Claiming Party of the notice and invoice
      therefore. In the event of a dispute, the Claiming Party and the
      Indemnifying Party shall proceed in good faith and attempt to negotiate a
      resolution of such dispute, and if not resolved through negotiations, such
      dispute shall be resolved by litigation in an appropriate court of
      competent jurisdiction.

            

    

     

    
      	
               
      

            	
              b.

            	
              The
      following provisions shall apply to any Claim of the Claiming Party that
      is based upon a Third Party Claim:

            

    

     

    (i) The
Indemnifying Party shall, upon receipt of such written notice and at its
expense, defend such Third Party Claim in its own name or, if necessary, in the
name of the Claiming Party. The Claiming Party will cooperate with and make
available to the Indemnifying Party such assistance and materials as may be
reasonably requested of it and the Claiming Party shall have the right, at its
expense, to participate in such defense. The Indemnifying Party shall have the
right to settle and compromise such Third Party Claim only with the consent of
the Claiming Party, which consent shall not be unreasonably withheld; provided,
however, that, in making its determination as to whether to grant such consent,
the Claiming Party shall be entitled to consider the impact of the proposed
settlement upon its reputation and/or the goodwill of the businesses which it
conducts.

     

    (ii) If
the Indemnifying Party shall notify the Claiming Party that it disputes any
Claim made by the Claiming Party with respect to, and/or it shall refuse or
choose not to conduct a defense against, such Third Party Claim, then the
Claiming Party shall have the right to conduct a defense against such Third
Party Claim and shall have the right to settle and compromise such Third Party
Claim without the consent of the Indemnifying Party. Once the amount of such
Claim is liquidated and the Claim is finally determined, the Claiming Party
shall be entitled to pursue each and every remedy available to it at law or in
equity to enforce the indemnification provisions of this Article Six and, if it
is determined, or the Indemnifying Party agrees, that it is obligated to
indemnify the Claiming Party for such Claim, the Indemnifying Party agrees to
pay all costs, expenses and fees, including all reasonable attorneys' fees,
which may be incurred by the Claiming Party in attempting to enforce
indemnification under this Article Six, whether the same shall be enforced by
suit or otherwise.

     

    6.4  Limitations
on Indemnification.  In no event shall
the aggregate liability of the Seller under Section 6.1 exceed
$50,000.  In no event shall the aggregate liability of the Buyer under
Section 6.2
exceed $ 50,000 (except that such limitation does not apply to Buyer’s
obligations pursuant to Section 1.4 of this
Agreement or the Promissory Note).  No person shall be entitled to
indemnification under this Article Six with respect to any Losses that are
attributable to any fraud, gross negligence or willful misconduct by such person
or any of its Affiliates.

     

    6.5  Closing
and Post Closing Conditions.

     

    6.5.1 Buyer’s
Obligations To Seller Concerning North Texas
Network.  Following the Closing, Buyer shall have the following
ongoing obligations and duties to Seller concerning the operations of the
Business and Buyer’s existing Granbury area operation, (collectively, “the North
Texas Network”) by Subsidiary:

     

    
      	
              a.  

            	
              Subsidiary’s
      Granbury-area operation will be domiciled, managed and operated from
      Granbury, Texas or the greater Fort Worth, Texas area, unless otherwise
      agreed to in writing by both Parent and Seller, until May 31, 2012 or
      the date Buyer pays in full the Purchase
Price.

            

    

     

    
      	
              b.  

            	
              Parent
      will operate the Subsidiary as a wholly owned subsidiary of Parent until
      May 31, 2012 or the date Buyer pays in full the Purchase
      Price.  Parent shall not, without the written approval of
      Seller, cause the Subsidiary to sell or otherwise dispose of any of its
      assets or of any Purchased Assets acquired from Seller until May 31, 2012,
      or the date Buyer pays in full the Purchase Price, except in each case for
      dispositions made in the ordinary course of business or payment of
      expenses incurred by the Subsidiary pursuant to the transactions
      contemplated by this Agreement.

            

    

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

     

    
      	
              c.  

            	
              Following
      the Closing, the operation of the North Texas Network will be focused on
      the sales, design, installation, and implementation aspects of the
      Business and all “shared service” aspects of the Business will be provided
      by Parent to Subsidiary as a support function in order to reduce costs and
      achieve economies of scale.  Examples of such shared services
      include, but are not limited to, (i) administrative and financial
      transactions such as billing, collections, purchase orders, payments,
      accounting, etc., (ii) administrative matters related to personnel, such
      as payroll, insurance, stock plans and 401K plan, and (iii) legal, tax,
      leasing, public releases, investor relations, and human relations
      functions.

            

    

     

    
      	
              d.  

            	
              Following
      the Closing, all operations of the North Texas Network’s wireless
      broadband ISP service as well as all future ISP services to commercial
      businesses and residential customers will be conducted as a part of the
      Subsidiary’s operations.

            

    

     

    
      	
              e.  

            	
              Buyer
      shall provide for an aggregate of up to 5MB of bandwidth to Ronnie
      Franklin at no charge for a 5 year period of time. Additional bandwidth in
      excess of 5MB will be provided at rates to be mutually
    agreed.

            

    

     

    6.5.2  Parent’s
Obligation To Seller.

     

    
      	
              a.  

            	
              Parent
      agrees to comply with its SEC reporting obligations for so long as Seller
      owns Rule 144 Restricted Stock.

            

    

     

    
      	
              b.  

            	
              In
      the event that the Certificates are not physically delivered to Seller at
      Closing, Buyer agrees to deliver such Certificates to Seller no later than
      five (5) days following Closing.

            

    

    

    6.5.3  Seller’s
Obligations To Buyer.  Following the Closing, Seller will
assist Buyer with respect to Buyer’s integration activities as reasonably
requested by Buyer, provided that such assistance shall not require Buyer to
incur significant time and expense.

     

    
      	
              a.  

            	
              The
      Seller agrees that for a period of five (5) years from the Closing Date,
      the Seller will not be involved in the internet access industry in Hood
      County and all counties contiguous with Hood County, except that Seller
      may provide to Buyer those services described herein.  The
      Seller shall not be precluded, under terms of the non-compete, from
      renting/leasing tower space to other customers that may provide internet
      access and being allowed to host websites and emails for non-profits,
      churches, friends and other parties.  Notwithstanding the
      foregoing, in the event that either Buyer fails to meet any of its
      obligations to Seller under this Agreement from and after the Closing
      Date, the foregoing covenant shall
expire.

            

    

    
      	
              b.  

            	
              Seller
      shall enter into a tower lease agreement with the Buyer upon terms to be
      mutually agreed on the 190 foot main tower on Hwy 51 South at 3439 Peak
      Road, Granbury, TX.  Such mutually agreed terms shall initially
      include the following:

            

    

    
      	
              i.  

            	
              Continued
      right of use of the four 19db ninety-degree sector antennae at the 182-185
      foot level and related 802.11 access points for the duration of the tower
      lease agreement.

            

    

    
      	
              ii.  

            	
              Continued
      right of use of the respective tower height spaces occupied for all
      existing backhaul equipment, specifically 25 foot to Frontier Internet,
      LLC NOC, 130 foot level to Tolar Water tower, 182 foot level to Acton
      tower..

            

    

    
      	
              iii.  

            	
              Additional
      right to  use existing space at 25 foot for backhaul via a
      “licensed” backhaul link to Frontier Internet, LLC’s bandwidth
      source.

            

    

    
      	
              iv.  

            	
              Buyer
      will not add or replace equipment on the 3439 Peak Road tower or in the
      equipment building without specific approval from
  Seller.

            

    

    
      	
              v.  

            	
              Buyer
      will insure their equipment, antennae or feedlines do not interfere with
      existing tenants at the 3439 Peak Road
location.

            

    

    
      	
              vi.  

            	
              Seller
      will insure that new tenants’ via contractual tower lease agreements,
      equipment, antennae or feedlines do not interfere with Buyers existing
      equipment at the 3439 Peak Road
location.

            

    

    
      	
              vii.  

            	
              The
      first five years of the tower lease agreement shall be at no cost to
      Buyer.

            

    

    

     

    6.5.4  Seller’s
Obligations To File Amendment.  Promptly following closing,
Seller will file the Amendment with the Texas Secretary of States
office.

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    ARTICLE SEVEN:
MISCELLANEOUS

     

    7.1  Expenses.
The parties hereto shall pay their own expenses, including accountants' and
attorneys' fees, incurred in connection with the negotiation and consummation of
the transactions contemplated by this Agreement and the Ancillary Agreements.
Buyer shall be liable for and shall pay and discharge when due any sales or
transfer taxes incurred in connection with the purchase and sale of the
Purchased Assets pursuant to this Agreement.

     

    7.2  Headings;
Use of Certain Words. The headings in this Agreement are for purposes of
convenience and ease of reference only and shall not be construed to limit or
otherwise affect the meaning of any part of this Agreement. Unless the context
clearly otherwise requires, as used herein, the term “Agreement” shall mean this
Agreement, including the Schedules and Exhibits attached hereto. The words
“herein,” “hereof” and “hereunder” and other words of similar import refer to
this Agreement as a whole and not to any particular Article, Section or other
subdivision, and, except as expressly provided otherwise herein, references
herein to Articles or Sections or Schedules or Exhibits shall mean the Articles
and Paragraphs hereof and the Schedules and Exhibits attached hereto. The use of
the neuter pronoun “it” shall also refer as appropriate to the masculine and/or
feminine gender, and vice versa. The use of the singular herein shall, where
appropriate, be deemed to include the plural and vice versa. As used herein, the
word “person” refers to any individual, corporation, limited liability company,
partnership, trust, Governmental Authority or other organization or entity. As
used herein, the term “including” shall mean “including, without limitation. For
those warranties and representations set forth in Article Three which are
subject to the qualification “to the knowledge of Seller” or similar language,
Seller shall be deemed to have knowledge of a matter if any executive officer
has knowledge of the matter. For those warranties and representations set forth
in Article Four which are subject to the qualification “to the knowledge of
Buyer” or similar language, if any, Buyer shall be deemed to have knowledge of a
matter if any executive officer of either Parent of Subsidiary has knowledge of
the matter.

     

    7.3  Notices.
All notices or other communications required or permitted to be given hereunder
shall be in writing and shall be considered to be given and received in all
respects when personally delivered, when sent by facsimile transmission actually
received by the receiving equipment, when sent by reputable express or courier
delivery service, delivery charges prepaid, or three (3) days after being
deposited in the United States mail, certified mail, postage prepaid, return
receipt requested, addressed as set forth on the signature page, or to such
other address as shall be designated by the addressee by notice duly given in
accordance herewith.

     

    7.4  Assignment.
This Agreement and the rights hereunder shall not be assigned or transferred by
Parent, Subsidiary or Seller prior to or following the Closing without the prior
written consent of the other parties hereto.

     

    7.5 Binding
Effect. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective legal representatives, heirs,
beneficiaries, successors and permitted assigns. Nothing expressed or implied in
this Agreement is intended or shall be construed to confer upon or give any
person other than the parties hereto and their permitted successors or assigns
any rights or remedies under or by reason of this Agreement or any transaction
contemplated hereby.

     

    7.6 Entire
Agreement; Amendment or Waiver; Cumulative Remedies. This Agreement, the
Schedules and Exhibits attached hereto and the agreements executed and delivered
in connection herewith constitute the entire agreement between the parties
hereto relating to the subject matter hereof, and all prior agreements,
correspondence, discussions, negotiations, agreements and understandings of the
parties (whether oral or written) are merged herein and superseded hereby. No
amendment, modification, or waiver hereto or hereunder shall be valid unless
made in writing and signed by an authorized signatory of each party to be
affected thereby against whom enforcement thereof is being sought. The failure
of any party hereto to enforce at any time any of the provisions of this
Agreement shall in no way be construed to be a waiver of any such provision, nor
in any way to affect the validity of this Agreement or any part hereof or the
right of such party thereafter to enforce each and every such provision. No
waiver of any breach of, or failure to comply with, this Agreement shall be held
to be a waiver of any other or subsequent breach or failure to comply. All
rights and remedies under this Agreement are cumulative to all other rights and
remedies that may be available to each party, including all rights and remedies,
whether in tort or otherwise, whatsoever at law or in equity with respect
hereto, which each party hereby expressly reserves.

     

    7.7  Severability.
The parties agree that if any provision of this Agreement shall under any
circumstances be deemed invalid or inoperative, this Agreement shall be
construed with the invalid or inoperative provision deleted, and the rights and
obligations of the parties shall be construed and enforced
accordingly.

     

    7.8  Applicable
Law. This Agreement in all respects, including as to its validity,
interpretation, enforcement and effect, shall be governed by the Laws of the
State of Texas without regard to the Laws which otherwise would govern under
principles of conflicts of Laws thereof.

     

    7.9  Jurisdiction;
Service
of Process.  Any Proceeding arising out of or relating to
this  Agreement or any transactions contemplated hereby shall be
brought in the courts of the State of Texas, Hood County, or , if it has or can
acquire jurisdiction, in the United States District Court for Northern District
of Texas, Fort Worth Division.  Each of the parties irrevocably
submits to the foregoing jurisdiction of such court in any such Proceeding,
waives any objection it may now or hereafter have to venue or to convenience of
forum, agrees that all claims in respect of the Proceeding shall be heard and
determined only in such court and agrees not to bring any Proceeding arising out
of or relating to this Agreement or any transactions contemplated hereby in any
other court.  The parties agree that any of them may file a copy of
this paragraph with any court as written evidence of the knowing, voluntary and
bargained agreement between the parties irrevocably to waive any objections to
venue or to convenience of forum.

     

    7.10  Counterparts.
This Agreement may be executed in one or more counterparts, all of which shall
be considered but one and the same agreement, and shall become effective when
one or more such counterparts have been signed by each of the parties and
delivered to the other party.

     

    [Remainder
of Page Intentionally Left Blank]

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    IN WITNESS WHEREOF, the
parties have executed this Agreement as of the day, month and year first above
written.

     

    

     

    BUYER

     

    ERF
Wireless, Inc., a Nevada corporation (“Parent”)

     

    

     

    By: /s/ R. Greg Smith        

    Name: R.
Greg Smith

    Title:
Executive Vice President

     

    

     

    ERF
Wireless Bundled Services, Inc. a Texas corporation (“Subsidiary”)

     

    

     

    By: /s/ Robert "Bobby Mack"
McClung

    Name:
Robert “Bobby Mack” McClung

    Title:
President & CEO

     

    Send Notices
to:

     

    Dr. H.
Dean Cubley, CEO

    ERF
Wireless, Inc.

    2911
South Shore Blvd., Suite 100

    League
City, TX 77573

    Telephone
281.538.2101

    Facsimile
281.538.2121

    Email
hdc@erfwireless.com

     

    SELLER

     

    Ronnie D.
Franklin

    

     

    By: /s/ Ronnie D. Franklin    

    Name:
Ronnie D. Franklin

     

    

    Send Notices
to:

     

    Mr.
Ronnie D. Franklin

    3435 Peak
Road

    Granbury,
Texas 76048

    Telephone:  (817)
578-5449

    Email:
Ronnie D. Franklin - (Ronnie@texans.net)

     

    13exhibit10_1.htm

 

 

 

SECOND AMENDED AND RESTATED

LICENSE AND PRODUCT SUPPLY AGREEMENT

THIS SECOND AMENDED AND RESTATED LICENSE AND PRODUCT SUPPLY AGREEMENT (“Agreement”) is made as of the 29th day of May, 2009 (the “Effective Date”),
by and between UNIGEN PHARMACEUTICALS, INC., a Delaware corporation whose principal place of business is located at 2660 Willamette Drive NE, Lacey, WA 98516 (“Licensor”), and SCHIFF NUTRITION GROUP, INC., a Utah corporation whose principal place of business is located at 2002 South 5070 West, Salt Lake City, Utah 84104 (together with its subsidiaries “Licensee”).

WHEREAS, Licensor is the owner of valuable data, trade secrets, science, technology, information, formulas, know-how, patents, trademarks and other intellectual property relating to the design and manufacture of a proprietary patented and patent pending compound (as more fully described in Schedule
A  hereto, the “Compound”), which is suitable for use in the manufacture and distribution by Licensee of dietary supplements and consumer health products which Licensee intends to market for certain joint and musculo-skeletal health or other purposes as set forth on Schedule B hereto (the “Purposes”);

WHEREAS, Licensee develops, manufactures, markets and sells nutritional supplements and consumer health products under various brands and through several different channels of distribution;

WHEREAS, Licensor has either been issued or made application for certain patents (the “Patents”) (the Patents are set forth on Schedule C hereto and
shall hereinafter along with any data, trade secrets, science, technology, formulas, know-how, intellectual property or other information relating to the Compound (other than the Trademark, as defined below) collectively be referred to as the “Property”);

 

WHEREAS, the parties entered into a License and Product Supply Agreement dated as of May 18, 2004 and amended and restated as of October 13, 2006 regarding, among other matters, the grant of an exclusive license for the Compound, the Property and the trademark Univestin® (the “Trademark”)
to Licensee in connection with the manufacturing, marketing and sale of joint and musculo-skeletal health related products containing the Compound in certain channels of trade in the United States, Mexico, Canada and certain other territories;

 

WHEREAS, Licensee now desires to obtain a non-exclusive license from Licensor and Licensor desires to terminate the existing licenses and grant to Licensee a non-exclusive license to use the Compound and Property in association with the offering for sale, advertising, promotion, manufacturing,
packaging, shipping, marketing, sale and distribution of certain dietary supplement and other products which contain the Compound as an active ingredient (collectively, the “Products”) in the food, drug and mass (including club) or other authorized channels of trade as set forth on Schedule B hereto (the “Authorized
Channels of Trade”) in the United States and the other territories as set forth on Schedule B hereto (the “Territories”)  for the Purposes; and

 

WHEREAS, Licensee further desires to purchase its total requirements of the Compound solely and exclusively from Licensor (to the extent Licensee's use of the Compound would be covered by the Patents) and Licensor desires to sell the Compound to Licensee in raw material form in accordance with
the specifications attached hereto as Schedule D (as amended in writing from time to time by mutual agreement of the parties, the “Specifications”).  Each party agrees that its consent to amend the Specifications will not be unreasonably withheld or delayed.

 

NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions contained herein, the parties hereby agree as follows:

 

  

 

  

 

 

1. Grant of License/Rights.  Subject to the terms and conditions of this Agreement, Licensor hereby grants to Licensee and Licensee accepts a non-exclusive license
to use the Compound and Property in connection with the advertising, promotion, manufacturing, packaging, shipment, distribution and sale of the Products in the Authorized Channels of Trade in the Territories solely for the Purposes. The parties hereby agree that the grant of this license shall mean that Licensee is permitted, directly or indirectly, in the applicable Authorized Channel of Trade in the applicable Territories to manufacture, advertise, promote, package, ship, distribute or sell the Compound, any
product containing the Compound or any product which incorporates, uses or relies on the Property, or any reasonable variation thereof solely for the Purposes.  Licensor understands and agrees that Licensee may outsource the manufacture of the Products in whole or in part, and is permitted to sublicense its rights to use the Property to the extent required to do so. All of the Property licensed to Licensee hereunder shall be on a royalty-free basis.

2. Ordering Compound; Production Quantities.

(a) Purchase Orders.  Licensor agrees to sell and Licensee agrees to purchase its total requirements of the Compound solely from the Licensor (to the extent Licensee's use of the
Compound would be covered by the Patents), for the Purposes pursuant to specific purchase orders submitted from time to time by Licensee which shall include, among other things, the required quantity of the Compound.  No purchase order is binding on Licensee unless and until it is in writing and signed by Licensee's authorized representative.  Licensor shall provide written confirmation within 2 business days of receipt of the purchase order.  Each purchase order shall be deemed
to be submitted pursuant to this Agreement and subject to the terms and conditions therein and herein.  In the event of a conflict between the terms of the purchase order and this Agreement, the terms of this Agreement shall apply.  Each purchase order shall be for a minimum of twenty-five (25) kilograms of the Compound.

(b) Forecasts; Minimum Lead Times.  Licensee shall provide Licensor with a six (6) month non-binding forecast, updated once per quarter.  Licensee shall
provide Licensor with a two (2) month binding minimum forecast; provided that Licensee may delay delivery of the Compound purchased.  Production lead time shall be at least two (2) calendar weeks prior to a requested delivery date from the date of the confirmed purchase order, provided, however, that Licensor shall use all commercially reasonable efforts to deliver the Compound to Licensee as soon as possible after receiving the purchase order unless otherwise requested by Licensee.  Licensee
shall have the right to cancel any order at no charge at any time upon four (4) weeks written notice prior to the requested delivery date.

(c) Scheduling.  Licensor will manufacture the Compound for a particular shipment on a schedule such that the Compound will be finished and ready for shipment
on or immediately before the shipping date as indicated on the purchase order.  The Compound must be shipped not later than five (5) days after production and quality testing is completed unless otherwise requested by Licensee.

(d) Inventories.  Licensor will source, purchase and warehouse all raw materials and maintain at all times sufficient inventories of ingredients and supplies
to meet its obligations hereunder.  Any expenditure Licensor may make based on projected future sales to Licensee (including any forecasts by Licensor or Licensee) are Licensor's responsibility and at Licensor's own risk.  Licensor shall not be entitled to reimbursement of any production costs or expenses unless specifically authorized in writing in advance by Licensee.

(e) Timeliness.  Licensor shall manufacture, ship and deliver the Compound in raw material form reasonably acceptable to Licensee, in a timely manner in accordance with the purchase
orders submitted by Licensee.  Licensor agrees that all Compound purchased by Licensee shall meet the Specifications.  Licensee shall have forty-five (45) days to inspect 

  

2

  

 

 

the Compound in order to determine that the Compound meets the Specifications.  If the Compound does not meet the Specifications, then such Compound may be rejected by Licensee at Licensor's expense.  If Licensee fails to inspect the Compound within such 45-day period, then the Compound shall be deemed to be accepted.  Licensor
agrees that it will notify Licensee immediately of any real or anticipated delays that could impact the supply of the Compound or the ability of Licensor to fulfill its obligations under this Agreement, including, but not limited to, component supply or labor shortages, or events which involve health, safety, building code, or regulatory issues or violations.

(f) Licensor Failure to Supply.  If Licensor fails to supply the Compound in the manner and within the time frames set forth in this Agreement, or is unable to
supply the Compound for any reason, Licensor shall:

	
(i)  
	
grant Licensee a non-exclusive license that allows Licensee to obtain Compound or the components constituting the Compound, from third parties during the period Licensor is unable to or chooses not to supply Licensee with Compound hereunder (but only for such period), and to use such Compound and the Property in connection with the advertising, promotion, manufacturing,
packaging, shipment, distribution and sale of the Products in the Authorized Channels of Trade in the Territories solely for the Purposes without violating the sole source provisions of this Agreement and without violating the Patents.  In connection with such third party supply during such period, Licensor shall provide Licensee with necessary production documentation (under the Confidentiality Agreement) and with access to Licensor’s raw material suppliers;

	
(ii)  
	
pay to Licensee (x) the difference between the price Licensee would have charged its customer for the applicable lost or delayed sales and the product cost of goods sold and (y) the difference between the price Licensee would have paid for the Compound hereunder and the actual price, if greater, that Licensee pays for raw materials to replace the Compound Licensor
is unable to provide under subsection (i);

	
(iii)  
	
Licensor will also pay to Licensee any penalties or other costs incurred by Licensee and owed to or credited to third parties in connection with such lost or delayed sale.

The amount of Compound ordered from such third party during such period will be counted towards satisfaction of the Annual Minimum Purchase Requirement described in Schedule F.  In addition, Licensor agrees that if Licensee loses a customer due to such delay or failure to supply, the parties will make good faith efforts to renegotiate
the Annual Minimum Purchase Requirement, which shall at a minimum be reduced by the greater of (i) the amount of sales to the lost customer during the 12 month period (or an annualized amount if sales covered a shorter period) preceding the failed or delayed delivery and (ii) the amount of sales to the lost customer contracted for the 12 month period (or an annualized amount if contracted for a shorter period) following the failed or delayed delivery.

To the extent Licensee purchases in excess of 125% of Licensee’s written forecasted purchases (as updated in writing) for a given six-month period under 2(b) above, Licensor shall have three weeks from the date of requested delivery to correct any failure to supply the Compound in the manner and within the time frames set forth in this Agreement
prior to being required to pay the amounts prescribed in Section 2(f) above.

  

3

  

3. Term.  Unless sooner terminated as provided herein, the term of this Agreement shall be for a period of 5 years (the “Initial
Term”) commencing on the Effective Date and continuing until the fifth anniversary thereof.  This Agreement shall automatically be renewed for additional periods of one (1) year (each, a “Renewal Term” and collectively, the “Renewal Terms”) (the Initial Term and the Renewal Term(s), if any, shall hereinafter be collectively referred to
as the “Term”) unless Licensee provides Licensor with written notice of its intention not to renew this Agreement no less than one hundred eighty (180) days prior to the end of the existing term. For each one-year period following the Initial Term, the Licensor shall increase or decrease the price of the Compound to an amount equal to the price of the Compound for the previous year (the “Base
Price”) plus or minus a percentage of the Base Price that is equal to the percentage increase or decrease, respectively, of the U.S. Bureau of Labor Statistics’ Consumer Price Index for All Urban Consumers Less Food and Energy (the “Core Index”) since the first day of such previous year, not to exceed 2.5% per year.

4. Permitted Uses.

(a) Subject to the provisions of Section 5 hereof, the license granted in Section 1 hereof entitles Licensee, directly or indirectly, to use the Property in connection with the advertising, promotion, packaging, manufacturing, shipment,
distribution and sale of the Products in the Territories for the Purposes, including, without limitation, letterhead, business cards, invoices and receipts, oral presentations, and all other documentation and communications to third parties relating to the sale, promotion and advertising of the Products.  No consents, approvals or authorizations shall be required from Licensor in order for Licensee to market the Products.

(b) Licensee shall cause to appear on all its Products and other materials or media described in Section 4(a) hereof the appropriate patent notification which shall be of such size and in such location as shall make it readily observable.

5. Prohibited Uses.

(a) Licensee shall use the Property only in the manner, for the approved Purposes and to the extent provided in this Agreement.  It is understood that Licensor shall remain the sole owner of the Property and that neither the
performance of this Agreement nor the use by Licensee thereof shall confer on Licensee any ownership rights thereto.  It is understood that Licensee shall remain the sole owner of its trademarks and the formulas for its Products and that the performance of this Agreement shall not confer on Licensor any ownership rights thereto.

(b) Licensee shall not advertise, promote, manufacture, package, ship, distribute or sell the Products outside of the Authorized Channels of Trade or Territories or for any purpose other than the Purposes.

(c) Licensee shall not use the Trademark or any trademark confusingly similar to the Trademark or any other trademark, service mark or business name owned by Licensor whether registered or not, for any purpose or in any manner whatsoever
without the express written consent of Licensor.  Licensor acknowledges that "Uniflex" is not confusingly similar to the Trademark.

(d) During the Term hereof, Licensor or any of its agents, employees, representatives or affiliates, may use or grant any party the right, directly or indirectly, to use the Property and the Compound. Licensor’s sale of the Compound
to Licensee will be on a non-exclusive basis, and Licensor is free to sell the Compound to other third parties inside or outside the Authorized Channels of Trade, or for the Purpose or other purposes; provided, however that Licensor will give Licensee first preference when filling orders for the Compound.

  

4

  

(e) Unless the clinical proven daily dosage for the Compound decreases or unless approved in advance, in writing, by Licensor, Licensee shall not recommend a daily dosage of Compound less than the amount set forth on Schedule
E on any of its Product labels or packaging.

6. Developments and Improvements.

(a) If during the Term hereof, Licensor shall develop or obtain new or derivative rights or make or acquire any new developments, improvements or modifications to the Property or developments, improvements or modifications to the Compound
not amounting to a Compound Derivative as defined below (the “Licensor’s Improvements”) relating to the Purposes, Licensor shall promptly advise Licensee of any and all information concerning the Licensor’s Improvements.  The Licensor’s Improvements relating to the Purposes shall be deemed to be included in the licenses granted herein by Licensor to Licensee; provided, however, that the Licensor’s Improvements
shall be and remain the exclusive property of Licensor.  To the extent that a compound is developed by Licensor after the date of this Agreement that is derived from the Compound, has a similar structure to the Compound or has similar biological activity as the Compound and is of sufficient magnitude of difference to the Compound that experts in the field would agree that it is a different compound than the Compound (a “Compound Derivative”),
then Licensor shall offer Licensee the first right to license the Compound Derivative for the Purposes in the Territories in the Authorized Channels of Trade. Licensor shall make an offer, in writing, to Licensee to license such Compound Derivative and shall provide Licensee with sufficient safety, efficacy, and other relevant data, similar to that provided for the Compound, to enable Licensee to ascertain interest in such the Compound Derivative (“Data”).  Licensee
shall either reject such offer in writing or the parties shall negotiate in good faith the rights to such the Compound Derivative during the 90 day period, which period begins when Licensor provides Licensee with all Data, following Licensor’s written offer.  If the parties do not execute a license to such the Compound Derivative during such 90 day period, Licensor shall be free to offer the Compound Derivative to any third party for any use whatsoever, but on substantially similar terms as those
offered to Licensee.

At Licensee's request, Licensor agrees to continue to provide the Compound as comprised as of the Effective Date irrespective of any of Licensor's Improvements or Compound Derivatives.

(b) If during the Term hereof, Licensee shall develop or obtain new rights or make or acquire any new developments, improvements or modifications relating to the Purposes to (i) the Property or the Compound, all of such improvements
shall be owned by Licensee, provided that Licensee does not use any Confidential Information (as defined in the Confidentiality Agreement) in developing or obtaining such rights; and (ii) the Products, all of such improvements shall be owned by Licensee.  Licensee shall also own all right, title and interest in any trademarks and copyrights developed by Licensee for use on the Products.  Licensee shall not have any ownership rights to the formula for the Compound.

7. Licensee’s Obligations.   Licensee shall ensure that the Products, and the sale thereof, materially comply with applicable laws and regulations
of the United States.  Without limiting the generality of the foregoing, it shall be the sole responsibility of Licensee to obtain and maintain all material licenses, permits, authorizations or product registrations required by the applicable Territory in order to sell the Products in such jurisdictions (“Health Registrations”), except for all patent search, application, registration and maintenance requirements and fees relating
to the Property or the Compound  on Schedule C, which shall be the sole responsibility of Licensor.  Licensor shall comply with all reasonable requests for assistance by Licensee in connection with such Health Registrations, including, without limitation, the furnishing of documents.  All such Health Registrations of Products obtained by Licensee shall be in the name of Licensee or its designee and Licensee shall be the sole owner thereof.  If Licensee receives any notice
from any such governmental authority raising any issues concerning the safety, efficacy or quality of any of the Compound, Licensee shall immediately notify Licensor in writing.  Upon receipt of such notification, Licensor shall make all efforts to cure such safety, efficacy or quality issue(s) as they relate to the Compound as promptly as possible.  Any Health Registrations of the Products that are required in the Territories
shall be at Licensee’s expense.

 

  

5

  

 

8. Licensor’s Obligations.

(a) At Licensee’s request, Licensor shall, at its sole expense, provide to Licensee any information in Licensor's possession or control as to the contents of the Compound or any other information in Licensor's possession or control required by any
governmental authorities in any Territory.  Licensor shall provide documentation and other information reasonably requested by Licensee in support of Licensee’s application, if any, for USP certification of the Products.  Licensee shall be solely responsible for any USP certification application, including the information contained in such application.

(b) Licensor shall be responsible for the proper and lawful acquisition, maintenance, storage and handling of the ingredients and components of the Compound and all Compound-related inventory while in Licensor's possession and control.

(c) Licensor shall manufacture or have manufactured, package, label, supply and deliver the Compound in accordance with the highest standards of the nutritional supplement industry and in strict compliance with (i) all applicable regulatory
requirements, and (ii) Licensee’s current “Supplier Shipping & Compliance Guide,” a copy of which is attached as Schedule G. Licensor shall deliver to Licensee all documentation necessary to adequately document the safety, quality and quantity of all ingredients contained therein and the efficacy of the Compound.

Such documentation shall also include, without limitation, a Certificate of Analysis which provides qualitative and quantitative confirmation of the active ingredient content of the Compound and the accompanying laboratory results for each and every lot of the Compound.  Licensee may rely on the content of the Certificate of Analysis
for any purposes.  Failure to provide Compound of suitable quality conforming to the Compound’s Specifications or documentation set forth in this Section 8 in support thereof shall be grounds for rejection of the Compound by the Licensee and a material breach of this Agreement which, if not cured within sixty (60) days, shall provide Licensee with the right to terminate this Agreement.  The Property shall not infringe upon or misappropriate the intellectual property or other rights of
any third party.

(d) Licensor shall materially comply with applicable laws, regulations, rules and orders applicable in the United States, including, without limitation, those of the U.S. Federal Food and Drug Administration (the “FDA”)
and those relating to the Dietary Supplements and Health Education Act of 1994, as amended.  The Compound is guaranteed by Licensor to be not adulterated or misbranded within the meaning of the Federal Food, Drug and Cosmetic Act, and not an article which may not, under such Act, be introduced into interstate commerce.  The Compound shall be merchantable and fit for the intended use by Licensee and the purchasers of the Products.  Licensor shall promptly notify Licensee if any audit
is conducted by the FDA while any of the Compound is being manufactured.  If the FDA pulls a sample of a lot of the Compound, Licensor shall immediately send a matching sample to Licensee.  Licensor shall promptly notify Licensee of any customer or other complaints, governmental inquiries, quality issues or product liability issues relating to the Compound or any of its components.

(e) Licensor shall use its best efforts to (i) at Licensee’s written request, challenge on the basis of prior art a third party patent application that seeks to patent the Compound in Territories where Costco operates and Licensor
does not hold a patent; and (ii) prosecute all pending patent applications with the appropriate governmental authorities in the Territories in order to obtain the issuance of the Patent registrations contemplated hereunder.

  

6

  

 

(f) Licensor shall use reasonable commercial efforts to promptly provide Licensee the results of any clinical studies relating to the Compound in Licensor's possession or control.

(g) Licensor represents and warrants that it has provided to Licensee all results of each clinical study in Licensor's possession or control performed by or at the request of Licensor on the Compound to date, and that such results have
not been changed, summarized or altered in any way.  Licensor further represents and warrants that, to the best of its knowledge after due inquiry, that the results of all clinical studies provided to Licenses are complete and accurate.

9. Parent Guarantor.  Unigen, Inc., a corporation of the Republic of Korea, of which Licensor is a wholly-owned subsidiary, shall guarantee Licensor’s obligations
under Section 17 of this Agreement, including without limitation, Licensor’s obligations under Section 17(d).  In the event that the net book value of Unigen, Inc. materially decreases from the net book value as at December 31, 2008, the parties shall discuss, in good faith, a manner or mechanism to increase the value of Unigen, Inc.’s guarantee hereunder, to adjust for the decrease in net book value, either through an increase in the level of products liability insurance required under
Section 17 (g), or an additional Licensor affiliate guarantee or some other manner or method reasonably acceptable to Licensee and Licensor. During the Term, Unigen, Inc. shall provide Licensee audited financials on an annual basis and a balance sheet and income statement on a quarterly basis within 30 days of such financials becoming available.

10. Pricing, Payment Terms; Shipment, Delivery and Inspection of Goods.

(a) Basic Pricing.  The price of the Compound shall be the price set forth on Schedule F hereto,
which price shall cover all costs and charges necessary to be paid by Licensee to Licensor hereunder.  The price for the Compound includes, without limitation, Licensor’s cost of complying with all of Licensee’s Specifications including, but not limited to, usual packing of good quality so as to sustain (without damages) normal motor freight transportation to the point of delivery in the United States.  The freight, crating, packaging and all other charges are to be paid by Licensor.  The
price covers all federal, state and local taxes and duties from which Licensor cannot obtain exemption.  The amounts of any such taxes or duties are the sole responsibility of Licensor.  Such taxes and duties shall be paid by Licensor when due.  Licensor represents that the price Licensee pays for the Compound is Licensor’s lowest price currently in effect for any of its customers with a license to sell the Compound for  the Purposes in any country in the Territories,
for goods of similar quality and similar or lower quantity.  Should any lower price, or any better terms, be quoted by Licensor to any of its customers with a license to sell the Compound for the Purposes in any such country in the Territories for goods of similar quality or similar or lower quantity, prior to completion of the delivery of the goods, Licensor will promptly notify Licensee and, thereupon, such lower price or better terms will apply to this Agreement in such country, provided that the
granting of such lower price or better terms to Licensee would not be in violation of any applicable law.  In calculating the price, Licensor shall take into account all rebates, discounts, charge-backs, promotions, credits or other favorable terms or similar arrangements.  Licensor represents and warrants that, to the best of its knowledge, the prices set forth herein do not violate any law or regulation in the United States relative to price discrimination, price-fixing, or price stabilization.

(b) Price Adjustments.  Except as otherwise expressly provided in this Agreement, the price set forth on Schedule
F hereto is not subject to escalation of any kind or for any reason, except for modifications or improvements to the Compound which have been requested by Licensee.

  

7

  

 

 

(c) Payment Terms; Delivery and Acceptance of Goods.  All Compound shall be shipped prepaid ground
transportation, FOB Licensee’s designated address in the United States.  Payment terms shall be net thirty (30) days from the later of Licensee’s receipt of the Compound and the invoice pertaining to such Compound.  Licensee shall be entitled to a 2% discount on the price of all Compound for which Licensee pays within ten (10) business days of the later of Licensee’s receipt of the Compound and the invoice pertaining to such Compound.  Late payment is considered
a violation of this agreement.  All payments shall be made in U.S. dollars.  Unless Licensee transports the goods with its trucks, the risk of loss or damage of the goods shall pass to Licensee at the time goods are actually accepted at the delivery address and the entire risk of loss or damage in transit shall be upon the Licensor.  Licensor bears the risks and all costs of ground transportation delivery to the U.S. delivery address, including without limitation, import duties,
taxes and other charges of delivering the goods to the delivery address, cleared for importation.  An acceptance of goods shall not be deemed to occur until after Licensee has had a minimum of forty-five (45) days to inspect the Compound.  Acceptance of any part of a commercial unit shall not be deemed to be an acceptance of the entire unit.

(d) Nonconforming Goods.  Without waiving any other rights or remedies available at law or equity, Licensee may reject or revoke acceptance of goods or any portion
thereof which, without limitation, are (i) not in conformity with Licensee’s quality control standards, (ii) defective, (iii) otherwise not in conformity with quantities or descriptions referred to in this Agreement or made a part hereof, (iv) not in conformity with the Specifications under which the goods are to be sold, (v) not in compliance with any mutually approved sample, or (vi) not in compliance with Licensee’s current “Supplier Shipping & Compliance Guide” (collectively, “Nonconforming
Goods”).  Licensor shall make no shipment of Nonconforming Goods, whether as an accommodation or otherwise, unless first authorized in writing by the Licensee.  Upon rejection or revocation, Licensee, at its option, may return at Licensor’s expense any or all of the goods or require correction or replacement at Licensor’s expense within five business days.

(e) Inspection.  Licensee shall have the option to inspect the goods, including materials used in the manufacture or packaging of the goods, and records relating
thereto at reasonable times and places before, during and after the manufacture or delivery of the goods.  Licensee reserves the right to inspect any facility in which the goods are manufactured, packaged or stored and any raw materials, goods in process, or finished goods.  An inspection or failure to inspect shall not relieve Licensor of any responsibility or liability with respect to the goods, including material used in the manufacture or packaging of the goods, nor shall an inspection
be interpreted as an acceptance of goods by Licensee.

(f) Failure to discover Nonconforming Goods. Notwithstanding the foregoing paragraphs, Licensee’s failure to discover Nonconforming Goods or other defects shall not
relieve Licensor of its obligations under Section 17 or any other provision of this Agreement or the applicable purchase order or limit any rights or remedies Licensee may have under applicable law or equity.

11. Representations and Warranties.

(a) Representations and Warranties of Licensor.  Licensor hereby represents and warrants to Licensee that (i) Licensor is the sole owner of the right, title and
interest in and to the Compound and the Property (ii) Licensor is entitled to grant the licenses contemplated hereunder to Licensee, (iii) the Property does not constitute an infringement of any existing intellectual property rights when used on the Products; (iv) the Compound is suitable for the purposes for which it will be used by Licensee; (v) the Compound as delivered by Licensor to Licensee will be free of defects, will be manufactured in accordance with good manufacturing practices and conform to the Specifications;
(vi) the Compound as delivered by 

  

8

  

Licensor to Licensee shall continue to be the same qualitative and quantitative formula as the Compound tested in any clinical studies conducted by or at the direction of Licensor as of the Effective Date; (vii) Licensor has the full power, capacity and right to enter into this Agreement, including, but not limited to, the ability and wherewithal
to provide for the manufacture of the Compound in compliance with the quality and quantity standards contemplated by this Agreement; (viii) Licensor has not licensed the Compound or Property or any aspect thereof in any manner inconsistent with the licenses granted hereunder; (ix) Licensor shall convey good, clear and unencumbered title to the Compound supplied; (x) neither the execution and delivery of this Agreement nor compliance with the obligations of Licensor hereunder, will violate any law or regulation,
or any order or decrees of any court or government instrumentality, or will conflict with, or result in the breach of, or constitute a default under, any contract, agreement, instrument or judgment to which Licensor is a party; and (xi) no action, approval or consent, including but not limited to, any action, approval or consent by any United States federal, state, municipal or other governmental agency, commission, board, bureau or instrumentality is necessary in order to constitute this Agreement as a valid,
binding and enforceable obligation of Licensor in accordance with its terms.

(b) Representations and Warranties of Licensee.  Licensee hereby represents and warrants to Licensor that (i) it has the full power, capacity and right to enter
into the Agreement; (ii) it knows of no pending or threatened action in law or in equity, which adversely affects the rights granted herein; (iii) neither the execution and delivery of this Agreement nor compliance with the obligations of Licensee hereunder will violate any law or regulation, or any order or decree of any court or governmental instrumentality, or will conflict with, or result in breach of, or constitute a default under, any contract, agreement instrument or judgment to which Licensee is a party;
and (iv) no action, approval or consent, including but not limited to, any action, approval or consent by any United States federal, state, municipal or other governmental agency, commission, board, bureau or instrumentality is necessary in order to constitute this Agreement as a valid, binding and enforceable obligation of Licensee in accordance with its terms.

12. Acknowledgment of Ownership of the Property.  Licensee acknowledges Licensor's right, title and interest in and to the Property and the goodwill associated
therewith.  Licensee shall not represent in any manner that it has any ownership right, title or interest in the Property other than as set forth in this Agreement.

13. Infringement.

(a) Licensee shall notify Licensor in the event that Licensee learns of any actual or apparent infringement of the Property.

(b) Licensor shall be required to take all necessary actions to protect the validity of the Property at its sole expense.  Such action shall include, but not be limited to, assuming responsibility at its expense for the defense
of any lawsuit challenging or affecting the rights to the Property, settling litigation, and/or instituting litigation at its expense to protect its rights to the Property.  Licensee shall comply, at Licensor’s expense, with all reasonable requests for assistance in connection therewith, including, without limitation, the furnishing of documents and having its officers or other persons reasonably designated by Licensor appear as witnesses.

14. Termination.

(a) In addition to any other rights of termination contained in this Agreement, this Agreement may be terminated prior to the expiration of the Term set forth in Section 3 hereof, by either party for the failure by the other party to
perform any material obligation hereunder, and if a failure to cure such breach shall continue for a period of ninety (90) days after written notice of default is sent by the non-breaching party to the breaching party.

  

9

  

(b) This Agreement may be terminated by either party upon written notice if the other party files or has filed against it a petition under any bankruptcy laws, makes an assignment for the benefit of creditors or has a receiver appointed for it or any of
its assets.

(c) This Agreement may be terminated by Licensee upon written notice if U.S. Patent No. 7,514,469 is invalid or unenforceable or otherwise limited such that the Products would not infringe the Patents.

15. Rights of Parties Upon Expiration or Termination.  In the event of the expiration or termination of this Agreement, Licensee shall have the right for a period
of twelve (12) months from the date of such termination or expiration to continue the use of the Property and the Compound in conjunction with the advertising and sale of Products in the Territories and allowing for the continued manufacture of the Products in order for Licensee to effect an orderly transition with its customers and to sell though its existing inventory of Compound, Products and related packaging materials.  After such twelve (12) month period, Licensee shall thereafter cease all use
of the Property and the Compound.  Termination or expiration of this Agreement shall not affect the indemnification obligations hereunder or any other provisions intended by their nature to survive the termination or expiration of this Agreement.

16. Confidentiality.  The Confidentiality Agreement dated July 15, 2002 by and between the Licensor and the Licensee (as attached hereto as Schedule
G, the “Confidentiality Agreement”) is and shall remain in full force and effect.  The parties acknowledge and agree that the existence of this Agreement and the terms and conditions hereof shall constitute Confidential Information under the Confidentiality Agreement.  The parties agree that the Confidentiality Agreement shall remain in full force and effect during the Term and for a period of five years thereafter.  Licensor
acknowledges that Licensee may file this Agreement or any portion hereof with the Securities and Exchange Commission if Licensee in its discretion deems such to be necessary or advisable.  Any such filing will not affect the parties’ obligations of confidentiality with respect to Confidential Information not disclosed in such a filing.

17. Indemnification; Limitation on Liability; Exclusion of Certain Damages; Insurance.

(a) Licensor agrees to indemnify, defend and hold harmless Licensee and its officers, directors, agents, employees and affiliates (such persons, together with their successors and assigns, are referred to herein as “Indemnified
Parties”) from and against any claim, demand, action, proceeding or cause of action made or brought against Licensee or any of its Indemnified Parties by any third party, including, without limitation, any damages, settlement payments, penalties, liabilities, costs and expenses or any judgment rendered against or incurred by Licensee or any of its Indemnified Parties in any such action and reasonable attorneys' fees and expenses incurred by Licensee or its Indemnified Parties in defending any such
claim brought against it or them except as otherwise provided below (“Damages”), to the extent arising out of or resulting from (i) a breach of this Agreement by Licensor; (ii) product liability attributable, directly or indirectly, in whole or in part, to the Compound or (iii) the violation or infringement of any patent, copyright or other intellectual property right relating to the Compound, the Property or other specifications or
materials selected by Licensor, provided that none of such occurrences are caused by the negligence or willful misconduct of Licensee.

(b) Licensee agrees to indemnify, defend and hold harmless Licensor and its Indemnified Parties from and against any claim, demand, action, proceeding or cause of action which is made against Licensor or any of its Indemnified Parties
by any third party, including, without limitation, any damages, settlement payments, penalties, liabilities, costs and expenses or any judgment rendered against or incurred by Licensor or any of its Indemnified Parties in any such action and reasonable attorneys' fees and expenses incurred by 

  

10

  

Licensor or its Indemnified Parties in defending any such claim brought against it or them except as otherwise provided below, to the extent arising out of or resulting from (i) a breach of this Agreement by Licensee, (ii) the improper, labeling (including packaging materials), promotion or use of the Products by Licensee or its respective employees
or agents unless such claim results from  incorrect information supplied by Licensor for the Compound or Property; or (iii) the violation or infringement of any trademark or trade dress rights relating to the Products (other than those owned by Licensor and licensed to Licensee hereunder) or other specifications or materials selected by Licensee, provided that none of such occurrences are caused by the negligence or willful misconduct of Licensor.

(c) Upon the occurrence of an event which would give rise to a right of indemnification under this Agreement, the party claiming the right to indemnification (the "Indemnitee")
shall give prompt written notice to the other party providing reasonable details of the nature of the event and basis of the indemnity claim.  The party obligated to provide the indemnification (the "Indemnitor") shall then have the right, at its own expense and with counsel of its choice, to defend, contest or otherwise protect against any such suit, action, investigation, claim or proceeding ("Action").  If
the Indemnitee reasonably determines that its interests are not adequately represented by the Indemnitor’s counsel, Indemnitee shall have the right to participate, at the Indemnitor’s expense, in the defense thereof with counsel of its choice reasonably acceptable to the Indemnitor.  In any event, the Indemnitee shall also have the right, but not the obligation, to participate at its own expense in the defense thereof with counsel of its choice.  The Indemnitee agrees to cooperate
to the extent reasonably necessary to assist the Indemnitor in defending, contesting or otherwise protesting against any such Action provided that the reasonable cost in doing so shall be paid by the Indemnitor.  If the Indemnitor fails within fifteen (15) days after receipt of such notice to (i) notify the Indemnitee of its intent to defend, or (ii) defend, contest or otherwise protect against such Action, or fails to diligently continue to provide such defense after undertaking to do so, the Indemnitee
shall have the right upon five (5) days' prior written notice to the Indemnitor, to defend, settle and satisfy any such Action and recover the costs of the same from the Indemnitor.  Any amounts owed by the Indemnitor to the Indemnitee may, at the Indemnitee’s option, be applied to offset amounts owed by the Indemnitee to the Indemnitor pursuant to this Agreement.

(d) Each party’s liability to the other shall be limited to the greater of $1.5 million or the value of the shipment of the Compound giving rise to such claim, except in each case to the extent the claim results primarily from
such party’s gross negligence, bad faith or intentional misconduct. Notwithstanding the foregoing limitation, in the event of a recall, discontinuation or market withdrawal of the Product resulting from the Compound, Licensor shall be liable to Licensee for up to $20 million.  The limitation on liability in this Section 17(d) shall not apply to the provisions of Sections 2(f), 17(a) and 17(b).

(e) EACH OF LICENSOR AND LICENSEE ACKNOWLEDGES THAT, EXCEPT AS EXPLICITLY SET FORTH IN THIS AGREEMENT, IN NO EVENT SHALL IT BE LIABLE FOR ANY INDIRECT, SPECIAL, CONSEQUENTIAL, INCIDENTAL OR PUNITIVE DAMAGE, LOSS OR EXPENSE, INCLUDING,
WITHOUT LIMITATION, DAMAGES FOR LOSS OF GOODWILL, LOSS OF PROFITS, LOSS OF USE, LOST TIME AND ANY AND ALL OTHER COMMERCIAL DAMAGES, EVEN IF ADVISED OF THEIR POSSIBLE EXISTENCE.  The foregoing exclusion of certain damages shall apply regardless of the success or effectiveness of other remedies, but shall not apply to any indemnification obligations and/or amounts owed pursuant to Section 17(a) and (b) above.

(f) The provisions of this Section 17 shall survive the expiration of the Term or any other termination of this Agreement.

(g) The Licensee shall maintain in full force and effect throughout the Term general product liability insurance with limits of not less than one million dollars ($1,000,000) per occurrence,

  

11

  

two million dollars ($2,000,000) in the aggregate.  The Licensor shall maintain in full force and effect throughout the Term general product liability insurance with limits of not less than five million dollars ($5,000,000) per occurrence, five million dollars ($5,000,000) in the aggregate. Licensor’s insurance shall name Licensee
and its affiliates as an additional insured, shall have broad form vendor’s coverage, and shall be placed with an insurance company which has a most recent rating given by Best’s Key Rating Guide of at least a “B” or above, or in such other company as Licensee may approve.  Each party agrees to promptly deliver certificates or other proof of said insurance to the other party.  Licensor’s insurance required by this Agreement shall be primary with respect to any
other insurance available to Licensor and shall contain a waiver of subrogation by Licensor’s insurance carrier against Licensee and its insurance carrier with respect to all obligations assumed by Licensor pursuant to this Agreement.  Each party will provide a copy of any contract of insurance required under this Agreement, upon request from the other party.

18. Force Majeure.  None of the parties shall be liable for any failure to perform or delay in performance of its obligations hereunder (other than the obligation
to pay monies due and owing for the shipment of Compound under this Agreement) caused by any circumstances beyond its reasonable control occurring in any of the countries in the applicable Territory, including, but not limited to, fire, earthquake, war, civil commotion, any act of central or local government, industrial disputes, lockouts and strikes, provided, however, that if the period of default continues for more than sixty (60) days, the other party shall be entitled to terminate this Agreement forthwith
by notice in writing.

19. Further Assurances.  The parties shall execute such documents and consents and take such other action as may be necessary to register this Agreement with
the appropriate governmental authorities of the countries in the Territories.

20. Amendments.  The provisions of this Agreement may not be amended, supplemented, waived or changed orally, but only by a writing signed by both parties and
making specific reference to this Agreement.

21. Waivers.  Neither Licensor's nor Licensee's failure to enforce any of the provisions of this Agreement shall constitute a waiver of its rights to later enforce
such terms or conditions. Any waiver under this Agreement must be in writing signed by the party to be charged therewith and expressly purporting to constitute such a waiver. Any such waiver shall be effective only for the specific instance and circumstance with respect to which it is executed and delivered.

22. Notices.  All notices under this Agreement shall be in English and shall be (a) in writing; (b) given by regularly scheduled express courier service, hand-delivered
or facsimile (confirmed by such airmail, express courier or hand-delivered correspondence); and (c) addressed to the parties at the addresses set forth immediately below, or to such other address as either party may advise the other in writing in accordance with the terms hereof:

 

  

12

  

                      

 

 

if to Licensor:                Unigen Pharmaceuticals, Inc.

2660 Willamette Drive NE

Lacey, Washington 98516

Attention:  Edward Cannon,

President and Chief Executive Officer

Facsimile:  (360) 413-9135

with a copy to:

 

                                          Unigen Pharmaceuticals, Inc.

2660 Willamette Drive NE

Lacey, Washington 98516

Attention:  Thomas J. Hoolihan,

Executive Vice President and General Counsel

Facsimile:  (360) 413-9135

if to Licensee:               Schiff Nutrition Group, Inc.

2002 South 5070 West

Salt Lake City, UT 84104

Attention: General Counsel

Facsimile:  (801) 975-1924

if to Guarantor:             Unigen, Inc.

#200-1, Songjung-Ru, Byeongcheon-Myeon

Cheonan-Si, Chugnam 330-863, South Korea

Attention: Ed Cannon, Chief Executive Officer

Facsimile: +82-41-529-1599

with a copy to:

Unigen, Pharmaceuticals, Inc.

2660 Willamette Drive NE

Lacey, Washington 98516

Attention:  Edward Cannon,

President and Chief Executive Officer

Facsimile:  (360) 413-9135

Notices shall be deemed given (i) on the scheduled delivery date, if sent by regularly scheduled express courier service; and (ii) when transmitted, if transmitted by facsimile and confirmed in one of the manners aforesaid.

23. Assignments And Sub-Licenses.  Neither Licensor nor Licensee shall assign its rights hereunder without the prior written consent of the other party hereto,
which shall not be unreasonably withheld; provided, however, Licensee or Licensor may, at any time, assign this Agreement without the prior written consent of Licensor to any affiliated company, or in the event of a change of ownership or control of Licensee, including a sale of substantially all the assets of the Licensee.  Licensee may sublicense its rights under this Agreement to affiliates of Licensee upon the prior written consent of Licensor, such consent not to be withheld or delayed unreasonably.  Licensee
may outsource the manufacture of the Products in whole or in part, and is permitted to sublicense its rights under this Agreement to the extent required to do so.

24. Brokers.  Each of the parties represents and warrants that such party has dealt with no broker or finder in connection with any of the transactions contemplated
by this Agreement, and, insofar as such party knows, no broker or other person is entitled to any commission or finder's fee in connection with any of these transactions.  The parties each agree to indemnify and hold harmless one another against any loss, liability, damage, cost, claim or expense incurred by reason of any brokerage commission or finder's fee alleged to be payable because of any act, omission or statement of the indemnifying party.

25. Execution; Governing Law; Arbitration.

  

13

  

 

 

 

(a) This Agreement shall not be binding until it has been executed on behalf of each party by a duly authorized officer of each party.

(b) This Agreement, and any and all disputes arising out of or relating to this Agreement, or the subject matter, enforceability or breach thereof, shall be governed by, and construed and interpreted in accordance with, the laws of the
United States and the State of Washington, without application of any conflicts of laws principles, except that the Arbitration provision in Paragraph 26(c) below, shall be governed by the Federal Arbitration Act to the extent that it is applicable.

(c) Any and all controversies, claims or disputes arising out of or relating to this Agreement, or the subject matter, enforceability or breach thereof, shall be settled and determined exclusively by
final and binding arbitration administered by JAMS under its Streamlined Arbitration Rules and Procedures and shall be heard in Seattle, Washington.  The state or Federal courts of the states of Washington and Utah shall have concurrent jurisdiction to issue preliminary injunctive or other equitable relief in order to enforce the terms of this Agreement.  Judgment on the award rendered by the arbitrator(s)
may be entered in any court having jurisdiction over the parties.  Each party to this Agreement waives any objection to personal jurisdiction of the state or Federal courts in Seattle, Washington and Salt Lake City, Utah.

(d) In no event shall the demand for arbitration be made after the date when institution of legal or equitable proceedings based on such claim, dispute or other matter in question would be barred by the applicable statutes of limitation.

26. Prevailing Party.  The prevailing party in any arbitration, litigation or other proceeding
arising out of or relating to this Agreement, or the subject matter, enforceability or breach thereof, shall be entitled to recover from the non-prevailing party its costs and reasonable attorney’s fees, as determined by the arbitrator(s) or court.

27. Entire Agreement.  This Agreement, including the Schedules hereto, the purchase orders, including the Specifications (as defined above), submitted by Licensee
to Licensor from time to time and the Confidentiality Agreement represent the entire understanding and agreement between the parties with respect to the subject matter hereof, and supersedes all other negotiations, understandings and representations (if any) made by and between such parties.

28. Headings.  Any headings used herein are for convenience in reference only and are not
a part of this Agreement, nor shall they in any way affect the interpretation hereof.

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

 

 

  

14

  

 

 

 

 

	 	
SCHIFF NUTRITION GROUP, INC.,

	 	 	 
	 	 	 
	
 
	
By: 
	/s/ Thomas H. Elitharp
	 	 	Name:  Thomas H. Elitharp 
	 	 	Title:  Executive Vice President – Operations and Support Services
	 	 	 

 

	 	
UNIGEN PHARMACEUTICALS, INC.,

	 	 	 
	 	 	 
	
 
	
By: 
	/s/ Edward Cannon
	 	 	Name:  Edward Cannon
	 	 	Title:  President and Chief Executive Officer
	 	 	 
	 	 	 
	 	UNIGEN, INC., a corporation of the Republic of Korea, as Guarantor for Section 17

	
 
	
By: 
	/s/ Edward Cannon
	 	 	Name:  Edward Cannon 
	 	 	Title:  Chief Executive Officer
	 	 	 

 

 

  

15

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}]]